Employee Turnover Isn’t That Bad
From all of the evil things that may happen to a call center, there is this one, inevitable, constantly returning nightmare: employee turnover. There’s no way to avoid that, have control over and it’s followed by gigantic costs that have to be covered. It’s seems tragic, almost in sense of antic tragedies, where any choice made by the character was bad and hopeless of change. Fortunately a devil seems to be not as bad as it’s painted and this rate can be tamed and it may even happen to be helpful.
Cambridge dictionary defines employee turnover as the rate at which employees leave a company and are replaced by new employees.
It’s a natural thing in a business for employees to leave from time to time. Although this rate varies according to a country, region and many different factors. There’s one huge pioneer when it comes to professions: CSR. Customer Service Representative, reps, agents, consultants, in outbound and inbound services, however precisely they could be named, they’re the ones who have the highest employee turnover rate. It’s way beyond the “healthy” number of rate (which is said to be an awfully imprecise number, located somewhere between unachievable 0 and 15%), causing incredible high costs to the company. As a main goal in that area it is said to reach as close to the magical 0 as you could. But is it always such a good thing to have the lowest employee turnover rate possible? Not exactly.
The healthy rate
The “healthy” measure of a turnover rate is a questionable, quite difficult number to set at some concrete value. As I mentioned before, it’s said to be around 0 to 15% but these scale occurs to be appropriate only in a general view, when the main thing considered are the costs that the employee turnover causes. In reality the most important thing, that should determine the “healthy” number of rate is who is leaving. It makes a huge difference, whether the ones who are leaving are high tier employees, beginners or workers, who have low performance achievements anyway.
But let’s begin with how to calculate your employee turnover rate:
Let’s say that the company has 200 employees at the beginning of the month and during these four weeks period of time 15 of them left. The reasons they had aren’t important, as we’re going to count the total turnover rate.
total turnover rate = the number of employees, who left the company divided by the total number of employees at the beginning of the month
We’re considering the total number of employees at the beginning of the month, so as a result of this equation we’ll get the total turnover rate for this precise month. Instead of counting for a particular month, we could calculate the rate for any other period of time, for example a year (of course, we’re considering the total number of employees at the beginning of the year then). The formula of equation doesn’t really change if we want to count more precise turnover rate, for example for the employees, who left voluntarily. In that case we just simply divide the number of those, who left voluntarily by the total number of employees in the company during the period of time we’re counting for (you can then compare it to the total turnover rate).
It’s not always the same
The employee turnover rate can be measured in many different ways. Although the method of counting doesn’t change, the numbers do, depending on what kind of group you count for. For example you could measure the turnover rate for the whole company. This option would give you a general view but not necessarily the information, that could help you or tell you what’s the reason they’re leaving. What you can do is to divide your employees into performance groups and then separately count the turnover rate for each group. You’ll be sure to have a conclusion following that measurement: if the employees with a high performance appraisal are leaving then it’s a huge loss for a company and something needs to be done immediately to prevent that. But if the one who’s out are workers with a poor performance, then maybe it’s not such a bad thing after all? You could measure the rate for each team, that you already have your employees divided into, in your company, as well. That should give you a clearer view whether the reason that people are leaving is a poor management. Another way is to divide people by the type of the call they’re making. The target customer can make a huge impact on how agents feel about their job and how fast they, colloquially speaking, are done with it.
Voluntary vs. involuntary
Another important aspect of an employee turnover is whether it’s voluntary or involuntary. It impacts the way you perceive the numbers you’ve received from calculation and makes an incredible difference with recognizing the reasons for the employee turnover rate to be so high.
People leave, that’s the fact you know for sure,as well as by heart. You probably left by yourself many times before. It’s not always because of some serious reasons like moving to another location, no, it could be anything and everything. There are as many reasons as people who are leaving. You can eliminate some factors from the neverending list by grouping people but you’ll be sure only if you ask.
Nevertheless, it’s important to understand how many of agents are being terminated. You can’t really prevent people from leaving because of their own decisions, you can only try to convince them to stay, motivate them more (you can read how to do that here). It’s a different story when the employee turnover rate is high due to terminations. That’s the signal that something needs to be changed. If it’s the performance of agents to blame then maybe the wrong people are being hired in the first place. Modifying the process of sales recruitment could surely help with that.
Employee turnover is good
It’s true, the employee turnover rate isn’t something you should be scared of. In fact it’s a quite useful tool, that gives you an opportunity to learn more about who you should hire. All you need to do is to analyse the rate as mentioned before, consider all the factors that could impact the decision behind your employers departure.
Despite the good sides of this rate, there’s a huge shadow over it and it screams loud and clear: money. An employee turnover is expensive. The real cost of an employee departure contains not only spendings considering them but also hiring replacement, training them, dealing with the lower performance of a new employee and all to risk that this new one would resign as well and the process would need to be repeated. The higher was the position of the former employee the higher the costs of his replacement is (and it’s his double or even triple salary, we’re talking about here). And it’s only for one agent! The numbers are getting enormous when the turnover rate is really high, as it happens at call centers.