I've done a lot of research over the years to drill down to the most likely reason for employees to quit and answer the question, "How do you stop the bleeding?"
As in bleeding money. The cost of employee turnover is exorbitant, with some recent estimates putting the price at $45,000 to $150,000 to replace an employee.
The data from my research on employee retention is astounding and not entirely positive. Here's a short sample of what I've gathered in the past few years:
- 51 percent of workers are looking to leave their jobs (Gallup)
- 40 percent of employees are considering employment outside of their current firm within the next year (SHRM)
- 34 percent of employees say they plan to leave their current role in the next 12 months (Mercer)
- 74 percent of all workers are satisfied with their jobs; 66 percent of those are still open to new employment (Jobvite)
- Cost of replacing entry-level employees: 30 to 50 percent of their annual salary (ERE Media)
- Cost of replacing midlevel employees: 150 percent of their annual salary (ERE Media)
- Cost of replacing high-level or highly specialized employees: 400 percent of their annual salary (ERE Media)
- 44 percent of Millennials say, if given the choice, they expect to leave their employer in the next two years (Deloitte)
- 45 percent of employees reported that they would be likely or very likely to look for another job outside their current organization within the next year (SHRM)
- 47 percent of Americans would leave for their ideal job even if it meant less pay (Adobe)
While there are various reasons for people quitting their jobs, truth is, when you pinpoint the causes, a large percentage point back to the manager (some estimate managers are responsible for up to 60 percent of all the reasons people quit). Gallup research has already proved that the immediate manager is your likely culprit.
The Mistakes Managers Make
But what's interesting to note are the common mistakes managers make that may result in their employees quitting -- all avoidable if given the right skills. The evidence is clear here that there's a leadership gap due to how managers can mismanage human beings -- many don't have the mindset or capacity to lead in the first place (but, unfortunately, get promoted to management on merit or because of a leadership shortage within their companies).
Here are eight management mistakes that I see floating to the top, time and time again.
1. Not recognizing their employees' unique strengths
Gallup proved that managers fail to identify and utilize the strengths and talents of employees that go beyond a job description. People love to use their unique talents and gifts, and the good managers will develop relationships with their employees to find out what their strengths are -- and bring out the best in their employees. The bottom line? The research is saying is that turnover is lower when managers adjust jobs according to individual talents and strengths.
2. Poor communication with the team
Billionaire entrepreneur Richard Branson doesn't mince words about the importance of communication. He writes:
Communication makes the world go round. It facilitates human connections, and allows us to learn, grow, and progress. It's not just about speaking or reading, but understanding what is being said -- and in some cases what is not being said. Communication is the most important skill any leader can possess.
Gallup research has revealed that employees whose managers hold regular meetings with them are almost three times as likely to be engaged than employees with managers who ignore them.
3. Not sharing information
A leading cause of turnover -- when done repeatedly and intentionally -- is hoarding information. A manager who hoards information does it to control his environment -- it's a power trip, and his people cannot trust him as far as they can see him.
If you've read Patrick Lencioni's masterpiece The Five Dysfunctions of a Team, you already know that the foundation for any good relationship is trust -- it's the foundation for his pyramid model -- and that foundation of trust simply cannot happen without transparency at work.
As a result, employees working for managers who share information will work harder for them, respect them more, be more innovative, and solve problems much faster.
This always tops the list. So how do you avoid a micromanaged environment?
First off, are you placing emphasis on training your best people properly -- especially during those crucial first six to nine months of your onboarding process? Wait, you do have an onboarding process, right?
Second, are you giving your people constant feedback and setting expectations, and, equally important, are you listening to two-way feedback that will further support their needs and build you up as a leader (and help improve the business, I might add)?
Last, are you allowing your people to give their input and best ideas, and to make decisions on their own? In other words (I use this expression a lot): Are you pumping the fear out of the room? Managers who dominate people and decisions are seen as very controlling and self-centered. Consequently, creativity, innovation, morale, and performance are stifled in the long run. When managers lead by fear, that approach is never sustainable.
5. Failure to listen
When a manager fails to listen to the collective voice of the team in pursuing a vision or in completing an important project, chances are team members will not feel cared for, respected, or valued.
Let me drill a little deeper. When a manager doesn't solicit the opinions of others, especially during change (change is often scary!), trust weakens and morale goes in the tank. So we're talking about a leader who has to stop getting the last word, a leader who allows others to give input to important initiatives. And the only way to do that is to first listen.
6. Not making themselves available
Rather than focusing on the obvious, let me offer a positive illustration of how to reverse this toxic habit.
This line of visibility and availability is important as your company grows and risks distance among its many layers.
"I want new employees to feel like this is a mission we're all in together," says Lin. "An open-door policy sets the tone for this. Whenever I'm in my office and available, I encourage anyone to come by and share their thoughts about how they feel Credit Karma is doing."
The strategy helps loop him in to what Credit Karma employees are talking about, which increases morale and lets employees know that he's a part of the team.
7. They lead with their egos
In so many of our own surveys and exit interviews, we get responses from employees complaining about know-it-all managers as the cause of much conflict and grief. One respondent called it "intellectual arrogance."
Managers who think they have the best ideas and answers and use them to wield power or control suck the life out of their teams.
On the flip side, people naturally gravitate toward bosses who display humility -- who don't have issues about being wrong and admitting it to their team.
Those bosses are more likely to be respected and trusted. So in axing ego for humility, managers have to be open to learning from others, asking for help in areas unfamiliar to them, and showing themselves as real human beings. This is what will cause employees to respond and drive loyalty to new heights.
8. They simply don't give a rip about their people
This mistake may be the most crucial: not valuing people. Managers who don't care or don't know how to care or at some point stopped caring -- all unacceptable for getting the best performance out of people.
In essence, the leader might think anyone is replaceable and see employees as cogs in a wheel rather than worthy colleagues to be treated like business partners in producing excellence.
Reversing this unfortunate managerial dysfunction starts with creating an environment in which people feel safe -- safe enough to experiment, to challenge you, to exercise their creativity and strengths, and to give opinions.
This type of workplace feels more like a community. It's safe to disagree and give the manager the benefit of the doubt, because fear, as I've said, has been pumped out of the room. And managers will care enough for their employees to make sure that this happens.