Labor turnover can be regarded as one of most significant HR metrics. The employee turnover often referred to as staff turnover includes measuring number of employees who are leaving the organization (Coles and Mortensen, 2016). When employees leave, an organization is then required to hire new people for filling positions and ensuring that operations of the company are running smoothly. Usually employee turnover comes under negative context because high costs are associated with turnover rates. Here high employee turn can be called expensive problem and results in loss of financial resources. Thus, a company has to make sure that it implements effective HR strategies for reducing labor turnover. This report discusses strategies for reducing employee turn for organization.
The process of HR can be measured in terms of impact and effectiveness on the strategy of the organization. Determination of these factors develops measurement standards and set of metrics. A common hiring metric includes cost-to-hire that involves measuring cost of running advertisements, taking interviews and then making a decision for gauging final cost of hiring new employee. This allows them to understand what cost is associated if an employee leaves and new one is to be hired. Identification of key metrics is also significant for measuring recruitment process success which is a challenge for talent acquisition professionals (Taylor, 2018). This difficulty is the reason why companies thrive for recruitment process outsourcing and spend time in fine-tuning strategies and technique related to measurement. Another common metric that is used for measurement is time to present/number of candidate slates and interview to offer ratio. The time to present/ number of candidate slates is one of the critical indicators for hiring manager satisfaction and time-to-fill which is the time length that passes between presenting of qualified candidate slate and opening of job requisition. This measurement will allow identifying whether recruitment team is meeting expectations of hiring manager or not. Interview-to-offer ratio also allows measuring how many interviews a manager needs to take for hiring candidate (Bandukwala, 2017). Usually standard ideal is no more than 3:1 that is one hire after conducting three interviews. If resourcing metrics are done properly then there are chances that employee turnover would be lower.
The overall turnover rate is just opposite to retention rate that indicates how healthy a team is. This can be calculated by dividing the number of individuals who are left during a particular period of time by number of employees present in this time period. This is then multiplied by 100. Retention rate and turnover rate is often used by organization interchangeably. Great turnover costs are associated with employee turnover. Turnover costs are a great metric for understanding how effectively and efficiently businesses are working (Guilding, et. al, 2014). In case, turn over cost of a business is high then it must be understood that there is something wrong within organization. This metric can help in identifying change which can add more value and also bring down the costs.
Resourcing and labor turnover metric allows organization to understand situation of employee turnover. Once an organization knows that employee turnover rate is high then it can utilize following strategies to deal with it:
Based on the analysis conducted above it can be concluded that resourcing and turnover metrics can help in building effective HR strategies which can be used for reducing turnover rate. The metrics calculations allow determining what is lacking in the organization and what factors are leading to turnover. These metrics help in developing HR strategies such as training, growth opportunities, feedback, appreciation, compensation, benefits and other strategies which can help in reducing employee turnover rate thereby retain more employees and reduce financial cost associated with hiring and training of fresh employees (Deery and Jago, 2015).
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