Want To Reduce Turnover?

What is your problem? You should continuously be asking this question. If you don't know what your problems are, your company will continue to struggle with higher than acceptable turnover. To adequately and appropriately answer the question, you must recognize that the question isn't really about you, it's about your employees. How are you influencing your employees abilities to get their work done in as effective and efficient a manner possible?

The ball might be in your court now, you may have what seems like an endless supply of qualified applicants ready to take over when an employee leaves; but this will not always be. The time is now, to prepare for change. Failure to focus on turnover reduction will significantly impact the viability of your organization.

Your employees are individuals. There is more to them than meets the eye. Are you digging beneath the surface? Be a gold digger. Gold does not sit on the surface, you must dig for it. If you're confused at how to dig, simply ask for the shovel. Ask. The fact alone that you are interested in them, as an individual, will entice them to make digging easier for you. Also, remember that while your needs are of high concern and priority, they are not your sole, and often even most important, concern and/or priority.

Start with an Employee Satisfaction Survey... Here's One For You. 

Risk Analysis & Hiring

Everything you do, hiring included, involves some form of risk. To effectively and efficiently deal with the risks associated with hiring, your job, when hiring, should entail identifying, preparing for and managing risk. Adequate risk analysis, when hiring, will ensure that you limit potential disruption to current operations and keep things as cost-effective as humanly possible.

So how do you identify, prepare for and manage risk effectively when hiring?

Let's Start With The Basics. 

Just what is risk analysis?

In its simplest form, risk analysis is an analysis that helps you properly identify, prepare for and manage problems. Specifically, what you are analyzing is the probability of something going wrong and the negative effects of occurrence.

The Steps.

When hiring, in the event that you decide (wisely) to perform a risk analysis, these are the suggest steps:

1. Identify The Risk.
   
   Identify existing and possible risks associated with the on-boarding of a new staff member. Risks you should seek to identify are:
   
   - Human Risks: Risks associated with the illness, death, injury or loss of the new hire or those that would directly impact them and/or their work.
   - Operational Risks: Risks associates with business operations.
   - Reputational Risks: Risks associated with a reduction in external and internal consumer confidence.
   - Procedural Risks: Risks associated with internal systems, fraud and accountability.
   - Functional Specific Risks: Risks associated with position specific duties and tasks.
   - Financial Risks: Risks associated with business profitability, market share, market fluctuations and available capital.
   - Technological Risks: Risks associated with technology.
   
   The list above is a great place to start when completing a risk analysis when hiring. Try as best you can, without bias or too much optimism, to look for vulnerabilities in the potential hire. If you work with others in the hiring process, ask them to do the same.
   
2. Prepare For The Risk. 
   
   Once you're aware of the possible risks associated with a new hire, you need be aware of what the likelihood of those risks being an issue are and the possible effects. The best way to prepare for a possible risk, is to assign a value to it, a literal value. How do you accomplish this?
   
   A simple formula.
   
   Probability X Cost = Value
   Example:
   
    WorkReply is considering hiring Sue. When a risk analysis was performed, one of the risks identified was a functional specific risks. The initial phase of the analysis suggested that given her previous occupational experience and the lack of direct relation to the position we are considering her for, there is a functional specific risk. Sue has never performed some of the specific duties and tasks related to the position. 
   
   To determine the probability, we need to ask ourselves 'how likely is the effect of risk to be a problem'. We decide that the likelihood of the effect of the risk being a problem is moderate, because although she has not had any direct experience, all her pre-employment testing indicates that she is more than capable of learning, in a timely manner, the position specific tasks and duties. Probability is on a scale of 1% to 99%. Probability, when preparing for a possible risk, can never be 0% or 100%. If the probability is 0%, that means the risk will certainly never be an issue. Therefor, it is not even a probable risk. If the probability is 100%, that means the risk will certainly be an issue because it will occur, guaranteed. No if's, and's or but's. It is guaranteed to happen. In this instance, you would be analyzing results, not risks. The lower the number assigned to the risk, the less likely it is to happen. The higher the number assigned to the risk, the more likely it is to happen.
   
   We decide to assign the moderate probably of 40% to Sue.
   
   To determine the cost of the functional specific risk, we need to figure out the cost of the risk. Training for the position specific tasks and duties in question would require 10 hours of training. You could determine the cost 1 of 2 ways. If the position is a direct revenue generating position, generating say $300 per day and she works 8 hours per day, she generates $37.50/hour in revenue (with her salary already in consideration), multiply that by the 10 hours of required training and you arrive at a cost of $375. If the position is not a direct revenue generating position and Sue would make $15/hour, multiply that by the 10 hours of required training and you arrive at a cost of $150.
   
   For the sake of the example, Sue's position is not a direct revenue generating position and  we figure the cost to be $150.
   
   To determine the value of the identified functional specific risk, we multiply the probability by the cost.
   
   0.40 (Probability) X $150 (Cost) = $60 (Value)
   You prepare for the risk by asking yourself the REAL question.
   
   What is the REAL question?
   
   Let's go back to the example, Sue.
   
   In Sue's case, the REAL question we need to ask, when preparing for the risk associated with hiring Sue is NOT if she qualified for the job based on her direct previous experience.
   
   The REAL question we need to ask, when preparing for the risk associated with hiring Sue IS....
   
   
   Can we afford the risk of $60 to hire Sue and make operations more effective and efficient? 
   
   
3. Manage The Risk. 
   
   Once you have identified and adequately prepared for the risks associated with hiring someone, you need to make sure you are prepared to manage the risks. It is important to consider the costs of managing risks, in whatever way you manage them, because if it is not cost-effective, it is not justified. When it comes to managing the risks of hiring, you have 3 options:
   
   - Use your existing resources.
   - Accept (and seek to minimize) the risk.
   - Invest in and acquire new resources.
   
   Conducting a proper risk analysis when hiring may require a little more work on your part, but it will be cost-effective in the long and short term. Also, a proper analysis should aid in the accuracy of your employee reviews, clearly showing you what progress is, or is not, being made.