Do You Really Know Why Employees Leave Your Company?

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More employees are voluntarily leaving their jobs than at almost any other time this millennium. When an employee quits, it can feel like a gut punch, leaving managers scrambling both emotionally and operationally. The loss can be particularly acute when employees "ghost" their organization, simply not showing up to work, sometimes only days after starting the job.

In his New York Times best seller, Principles, Ray Dalio argues that setbacks, like losing a valued employee, provide an important learning opportunity for organizations—as long as leaders are willing to reflect on and identify the root cause of such losses. Too often, though, managers and HR professionals are so busy doing damage control that they fail to conduct a thorough autopsy to help them understand what happened and what corrective action is needed to prevent similar episodes from occurring in the future.

Of course, many organizations have an exit interview process that should, ostensibly, provide insights to help improve employee retention. However, even when conducted well, these interviews have serious shortcomings. Most notably, in cases of ghosting and other acts of impulsive quitting, workers may depart before their organization has the opportunity to conduct one. Even when exit interviews take place, research suggests that a large percentage of employees are not candid. Whereas some departing employees mask critical feedback in order to leave a positive impression, others feel that providing this information is a waste of time because they believe the company is unwilling to change. In addition, departing employees may feel that, because of how poorly their company treated them, management does not deserve to know their true reasons for leaving. In short, exit interviews are often ineffective.

So how can organizations respond to resignations in more constructive ways—ways that might transform the pain of employee turnover into progress? Based on our research studying the experiences of hundreds of resigning employees and the managers of recently resigned employees, we offer three recommendations:

Investigate how the employee resigned. People typically resign using one of seven styles, which range from positive and constructive to negative and harmful:

• Grateful goodbye: employees show appreciation and provide assistance as they depart
• In the loop: employees keep their supervisor apprised of their intention to leave
• By the book: employees give standard notice and an explanation for their departure
• Perfunctory: employees resign by the book but do not explain why they are leaving
• Avoidant: employees indirectly inform their manager or let word of their resignation filter back to them
• Bridge burning: employees engage in harmful dysfunctional behavior on their way out
• Impulsive quitting: employees walk out without giving any prior notice
  

These styles often reflect how departing employees feel they were treated by their organization and their manager prior to leaving. Therefore, if many employees within a firm resign by expressing gratitude and giving reasonable notice, this may signal that the organization is a healthy place to work. On the other hand, if bridges tend to get burned during employee resignations, leaders should take this as a signal that they should investigate the cause of these destructive departures.

The first step toward turning employee resignations into a source of organizational learning and improvement, then, is to code them based on style and review them periodically. If leaders find patterns in this data, they can start to identify the source of the problem. Overall, do employees tend to follow company guidelines when they resign (doing it by the book), or is there a great deal of variance in how employees quit? Is walking off the job with no notice more common in particular departments or for certain workers? Do the employees of certain supervisors always resign by providing more notice than is required? Closely examining resignation styles can help organizations clearly identify bright spots and problem areas.

See what the co-workers closest to the employee have to say. Although people will not always be open to divulging their true reasons for quitting, in many cases their peers may have insights and be motivated to share that information in order to help the organization improve. Thus, by having informal discussions with colleagues close to the employee who resigned, companies may be able to ascertain the motives behind their departure. An added benefit of this approach is that it gives remaining employees, who may be disappointed and confused by their coworker's resignation, an outlet to discuss their thoughts and opinions, which may reduce any feelings of distress.

Of course, some colleagues may feel that the company is asking them to be disloyal to their friend by sharing this potentially private information. As such, we recommend acknowledging the tension that this line of inquiry could create. Leaders should reassure the employees that their participation is voluntary, and make it clear that the information they seek is only for improving the experience of the remaining workforce and the performance of the company. This approach is likely to be most effective when managers possess good working relationships with their employees, such that subordinates feel psychologically safe to share their insights without fear of retribution toward them or their friend. Likewise, such conversations are more likely to be constructive when managers have a habit of listening to employees and acting on their input.

Examine and learn from what the employee does after they leave. HR professionals can do this by tracking where their alumni go. If a large proportion of quitters return to school to pursue graduate degrees, for example, there may be an opportunity for the company to improve retention by offering discounted or free education. If several employees leave to become stay-at-home parents, perhaps more expansive work-family programs would provide employees with healthier work-life balance. If there is a trend of employees' leaving to work for a particular competitor, then it is certainly worth looking into that firm's culture, development programs, compensation and benefits to determine why your organization is losing talent to a rival.

Hearing the words "I quit" is rarely pleasant, but by pushing through the discomfort and using an evidence-based approach to determine the cause and nature of the loss, managers and HR professionals can gain valuable knowledge for their firms. The next time an employee discloses their plans to leave, instead of focusing your efforts on replacing this lost human capital and minimizing the disruption caused by the departure, take the time to reflect on the nature of the resignation, collect data to understand the cause of the departure and consider its broader organizational implications. Over time, by taking advantage of the learning opportunity presented by even the most painful resignations, voluntary turnover can be a source of continuous improvement for managers and for firms.

Anthony C. Klotz is an Associate Professor of Management at Texas A&M University's Mays Business School. Mark C. Bolino is the David L. Boren Professor and Michael F. Price Chair in International Business at the University of Oklahoma's Price College of Business.

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[SHRM Business Solution: SHRM Employee Exit Survey]