High Turnover Is NOT Just Part of the Business

Editor’s note: Today, Terry Petra begins a seven part series on recruiting’s most challenging job: recruiting, training, and retaining high performing recruiters. This series first appeared in our monthly newsletter, The Fordyce Letter. Each Thursday look for the next installment of Terry’s series, HIRING RIGHT.

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Based on the tremendous response from readers regarding my previous article on hiring top performers (“Why Can’t I Do A Better Job of Hiring?”),  I will be doing a series of articles on this most important topic.

This article diagnoses the problem and subsequent articles will offer suggested solutions.

Most everyone would agree that the most important factor in determining the long-term level of profitability for your firm is your ability to attract, hire, train, maintain and retain consistent producers. However, many owners and managers believe that having high turnover of recruiters and professional staff is just part of the business. They cite such industry-wide myths as:

You can never tell until you get them on the desk.
It’s impossible to predict if an individual has the motivation to be successful in this business.

And the biggest myth of all:

Hire in masses, train in classes, and kick them out on their _ _ _ _ _.

And they ask the question, ”Why is it that we can recruit top talent for our clients and yet seem to have difficulty in recruiting top talent for our own firms?”

Owners and managers answer this question by stating that, logically, this is not a difficult business to understand. However, emotionally most people cannot handle it. They are too insecure or suffer from low self-esteem. This generally appears shortly after the individual is hired, when the manager begins to see them establish a daily work pattern. This work pattern can best be described as:

Concentrating on comfortable processes rather than positive results.

In other words, whether they realize it out not, the new employee settles into a pattern where they focus on non-threatening activities (excessive Internet researching, endless emailing and text messaging, repetitive data base searches, resume reading, and recycling the same non-productive but friendly prospecting calls) versus focusing on achieving positive results (making phone contact with key decision makers, writing properly qualified searches or new temp/contract business, developing fresh recruits and making placements). This is usually where the manager determines the new employee is not right for the business and a termination follows.

Unfortunately, in many cases the termination does not take place for some time yet as the manager is trying to rationalize the process. This is one of the mortal sins of poor leadership – not being decisive.

The cycle then repeats itself. Being uncertain as to whom, and, in many cases, how to hire, the manager commits the same mistake until eventually their company, through sheer numbers, is able to attract and retain a group of marginally successful producers, or the alternative – they go out of business. Sound familiar?

You Have A Problem If…

This pattern of turnover in our business is not a given. However, if the tenure of your staff averages less than three years and you have been in business more than five years, you do have a turnover problem.

The exception to this is if your company is on a continuous growth curve where the press of increasing business necessitates the addition of staff.

In studying the reasons for turnover, we began our research by looking at our client companies and contrasting those firms in similar industries that suffered from high turnover with those firms which were successful in retaining their good people and building strong tenure.

Next we conducted a similar study for our industry (this study is continuous and on-going for both search/recruiting firms and temporary/contract firms).

Article Continues Below

Causes of High Turnover

Based on this continuous research, we were able to isolate several key factors, which are controllable, that contribute to the high turnover rates in our industry. These factors include:

  1. A lack of understanding regarding whom to hire.
  2. An inability to attract the right type of individual to hire.
  3. Mutual mystification in the hiring process.
  4. Unrealistic expectations on the part of both parties.
  5. A lack of identifiable and realistic performance standards.
  6. Inappropriate, out-dated, or non-existent training programs.
  7. Too much emphasis on training and not enough on results.
  8. Lack of appropriate leadership and management support.
  9. Failure to understand the nature of personal motivation.

In order to decrease turnover and increase profits, you need to understand each of these factors and how to correct them if they are present in your firm.

In this article we will address the first one, “A lack of understanding regarding whom to hire.”

A common error made by most managers in the hiring process is to focus almost entirely on identifying individuals who have the talent to do the job. Although this is important, ask yourself:

How many people have I hired who had the talent to do this job but were not successful because they wouldn’t do it or they quit without giving it a full effort?

Manager Style Issues

From our research, most managers stated that the majority of the people they hired “could” do the job, they just “didn’t.” Most of these individuals were intelligent; presented themselves in a professional manner; and possessed better than average interpersonal skills. Although several of the nine factors listed above contributed to their lack of success, one of the major compounding factors was they were ill-suited to work for that particular manager. They did not respond in a positive fashion to the manager’s operating style.

Although most managers possess varying degrees of flexibility, right or wrong, each manager has a preferred operating/management style and hiring individuals who do not respond properly to that style creates problems from day one. This has very little to do with whether or not you like each other. It has everything to do with whether or not you can effectively work together, and whether or not they will follow your lead.

Before Hiring, Ask Yourself

Therefore, one of the first keys to eliminating turnover is to only hire people who will work well within your primary operating/management style. In order to do this you must carefully determine the parameters of that style. You can do this by asking yourself the following questions:

  • Are your primary operating characteristics predominantly internal or external?
  • How do you prefer to process information?
  • Physically, how close do you need to be to your people?
  • How effective are you at managing your time? How do you handle interruptions?
  • What determines your expectations for others? For yourself?
  • How do you express yourself emotionally? Is it consistent?
  • What actions or mannerisms of your employees irritate or frustrate you and how do you handle this?
  • How would you define the pace at which you work?
  • What process do you use when solving problems?
  • What determines your level of patience or lack of patience?

Assess Yourself

After answering these questions, seek objective, third party input from present and past employees, peers, managers, and other who know you from a professional perspective. Then conduct an audit of your daily activities, in 15 minute increments, for a period of at least one month. In comparing the answers to your questions with the third party input and your activity audit, a fairly clear picture of your preferred operating/management style should emerge,

Typically, you will be most effective when you are functioning within your preferred operating/management style. Consequently, once you have this identified, make certain that everyone you hire is aware of your style and is capable of effectively functioning within it. If they possess the basic abilities to do the job, and they can appropriately interface with you on a daily basis, you have a good start on a mutually profitable, long-term relationship.

This is step one in decreasing turnover and increasing profits. However, it is one of the most important steps and one that serves as a foundation for everything that follows.

As always, if you have questions or comments about this article or wish to receive my input on any other topic related to this business, just let me know. Your calls and e-mails are most welcome.

Recipient of the Harold B. Nelson Award, Terry Petra is one of our industry's leading trainers and consultants. He has successfully conducted in-house programs for hundreds of search, placement, temporary staffing firms and industry groups across the U.S., Canada, Mexico, Australia, New Zealand, Russia, England, and South Africa. To learn more about his training products and services, including PETRA ON CALL, and BUSINESS VALUATION, visit www.tpetra.com. Terry can be reached at (651) 738-8561 or click to email him.

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