The Boston Red Sox had a little team turnover after they won the 1918 World Series, four games to two. Among the players they unloaded was George Herman Ruth, who ended up on the Yankee roster in 1920. The Red Sox didn’t win another pennant until 1946. The Yankees were in the Series six times in eight years with Ruth on their side.
Don’t tell a Red Sox fan turnover doesn’t matter. And don’t tell the folks at PayScale Human Capital that, either. They just put out a tome dispelling myths about turnover. And they make a compelling case that the impact of turnover is much trickier to measure than one might think.
Folks who follow the news are used to stories about mass firings and mass exoduses. We’re taught to think that it’s bad to binge on anything, so turnover in pretty much any form is considered a negative. But PayScale encourages us to reconsider labeling any sort of turnover, be it slow and low, high and hasty or anywhere in between.
“What’s perceived as obvious may not be actual,” PayScale says. “Our perception is often clouded by our biases and preconceptions, as well as what we observe in the world immediately around us. Perception is important, but
hard data is important, too.”
Here, then, are four myths about turnover, according to PayScale.
Myth No. 1: Low turnover is always good
This may work well for the boys and girls in the C-Suite when they present data to shareholders. But the floor managers know that low turnover can be a sign of complacency, of a lack of will by management to set higher standards and hold people to them, and a willingness to tolerate bad behavior.
“Employees stay at companies for all kinds of reasons, and those reasons may have nothing to do with gratitude for a great employer or a desire to perform well,” the myth-busters say. “Perhaps your employees:
• Are overpaid;
• are under-skilled;
• aren’t motivated to advance;
• believe the company benefits are too good to be replicated elsewhere;
• believe the economy is too unstable;
• know very well that no other employer would put up with their bad behavior.”
Or all of the above. Low turnover can be the result of low motivation and poor leadership just as easily as it can be a sign of workplace health.
Myth No. 2: Turnover is always bad
Yes, it can be bad, if you’re the Cleveland Cavaliers and LeBron James just went south. But more often than not, turnover that is the result of astute management is healthy and gets the organization fresh and responsive.
“Sometimes change is desperately needed, and that means some heads have got to roll,” say the PayScale folks. “Whether employees are fired, retire, or self-select out of the transformation to come, the point is that turnover can be a fantastic opportunity for employers to select, place, and develop employees (both incumbent and new) who are enthused about the company and the direction in which it’s heading. Some turnover is actually good for the company — especially in the case of overpaid, under-performing employees.”
Myth No. 3: You can’t control turnover
Well, you can, if you fire everyone all the time. Probably not a good strategy. Otherwise, no, people have free will and can come and go as they please.
The recommended policy is to develop a culture of rewarding and retaining top talent, says PayScale. “Employers can create a workplace culture that encourages the best employees to stay and at the same time, encourages good turnover. It takes mindfulness and forethought, but great employers do it every day.”
PayScale advises management to find out what motivates their workers, and what disengages them from their jobs. Ask your top workers what they need to be even more productive, and what you could offer them to turn down a comparable offer from a competitor.
“While no one is irreplaceable, employees are not expendable,” PayScale says. “Employees are unique beings with unique strengths, weaknesses, talents, and skills. If one of your key employees was hit by a truck tomorrow, you’d need to replace that employee, and replace him you would. But your new employee won’t be a clone of the one you lost. She’ll be different, and those differences will have an impact on your organization for the better, the worse, or somewhere in between.”