Saturday, 31 January 2015

Sometimes employees leave their employers not their managers


The development of effectual employee retention and most of all of talent retention practices definitely represents one of the subjects firmly high at the top of business leaders’ and HR directors’ agenda. The process is virtually invariably the same: individuals very keenly and enthusiastically join the new employer and later on disillusioned leave this.

 

Employees leave their employers for a whole range of reasons which can be broadly grouped into two different categories: endogenous-environment- and exogenous-environment-related.

 

Internal-environment-related reasons

One of the reasons, arguably the most recurring reason, for employees leaving their organization is the business management, more specifically their line manager.

 

The role played by managers

Once candidates have been identified as the best fit for the role and officially appointed to the job, the employer representative with whom these establish the stronger and most frequent contact within the organization unquestionably is their line manager. The establishment of a good relationship between managers and employees, however, does not invariably prove to be smooth sailing. Whenever managers do not succeed in building and developing good relationships with their direct reports in fact the latter tend to become the more and more ill at ease with the former in particular and in the workplace in general. Disappointed employees start consequently making plans to leave the organization as soon as they can. This circumstance has been properly summarized by Buckingham and Coffman (2005): “Employees leave their managers and not their employers”, and rephrased by MacLeod and Clarke (2009) who suggested that in actual fact individuals join organisations, but leave later on their managers.
 
It doesn’t go unnoticed that all of that clearly occurs at the expenses of employers and to the detriment of the regular unfolding of their business activity. It is likely that employers have carefully and arguably not effortlessly put in place all the resources deemed necessary to attract and recruit the right individuals. Albeit different from employer to employer, it is an axiomatic fact that the cost of the recruitment and selection process is invariably high.

 

The sub-factors accounting for individuals deciding to leave their employer by reason of their manager may be in turn associated with different circumstances. Also in this case these may be grouped into two main different categories: on the one hand can be included the causes associated with managers’ leadership style; whereas on the other hand those linked to managers’ inability to improve job design and “give individual a good job.”

 

Leadership style

Increasingly, individuals pay attention to the way they are treated by their managers and tend to associate with this aspect a growing importance. The leadership style adopted by managers needs hence to be appropriate and has to fit both the circumstances and the business culture. The most undesirable situation however occurs when managers adopt no leadership style whatsoever and, even worse, when these totally lack of style when interacting with their direct reports.

 

Employee involvement and participation

With some exceptions, employees at large aim at performing interesting and fulfilling jobs. It is unlikely that individuals may decide to leave an organization whether their managers organize and design their staff work in a way that makes it significant, compelling and varied and involve employees in this process stimulating and favouring their active participation. As Herzberg (1987) used to say: “if you want people motivated to do a good job, give them a good job to do.”

 

Not really an easy task

The role of managers however is everything but straightforward. Constantly finding new and more effective ways to improve processes and the way the job can be performed is clearly easier to say than to achieve in practice. Even more so when as it usually occurs managers also strongly contribute with their practical work to the final outcome produced by their unit.
 
Individual involvement can indeed prove to be the ultimate means to an end. Whether employees are involved and made aware of the overall process which leads to the production of the final outcome, these can actually help managers to identify effectual options and sounder and more appropriate solutions.

 

Forced to move out of their comfort zone

Albeit managers represent the most common cause for employees leaving an organization, this is not clearly the only one motive for employees making such a decision.

 

Individuals may also decide to leave their employer by reason of some undesired changes which they perceive as forcing them to leave their comfort zone or, more in general, because they feel that organizational climate has drastically changed, or rather, worsened insofar as to perceive as irreversibly altered their appreciation of the working environment. Such new circumstances may actually sometimes be the fruit of line managers’ initiative, but most of the times these changes are introduced on request of the company top-management and board.

 

Under such circumstances individuals perceive the workplace somewhat of hostile and no longer enjoyable as it was previously used to be perceived. The detrimental impact caused by this change is at this stage considered as remarkable insofar as to be considered irreversible and the action of leaving the organization hence necessary.

 

Lack of opportunities for growth and development

The content of the unwritten psychological contract has changed over time; nowadays, individuals want to perform significant and fulfilling jobs and are hence thirsty for growth and development. Whether an individual should realize that s/he is performing a dead-end job and that s/he will never be offered opportunities for growth or development it is very likely that this decides to leave.
 
External-environment-related reasons

Albeit more often than not the main reasons for employees deciding to leave their current employer are associated with the endogenous context, there are indeed some other additional causes prompting individuals to leave a company.

 

In some cases, employees can be lured by the objectively captivating and challenging employment offers coming from the external environment, which can actually provide these real opportunities for development and growth that could not even potentially be offered by the current employer.

 

Especially in the case of a tight labour market, it should not really come as a surprise learning that a talented employee has received an irresistible offer from a different employer. What worse, under such circumstances individuals may also decide to leave very quickly the organization in order to avert missing the boat.

 

It is not a matter, or rather, not exclusively a matter of value proposition, that is, of the worthiness of the reward package offered; the chance to take a genuine new challenge up, usually associated with a growing level of responsibility and autonomy or with the immediate involvement in a prestigious or ambitious project, can definitely and objectively justify an individual decision to leave an organization; albeit not triggered by any endogenous-related reason.

 

The international perspective

Sometimes the decision to leave an employer can also be based on the employee desire to move and work abroad. Individuals are the more and more willing and even eager to relocate in a foreign country and experience new lifestyles. Furthermore, whereas for centuries the only attractive places where to move internationally were mainly located in North-America, Australia and Europe, nowadays the appeal and seduction of other areas, especially of those located in South-East Asia, are remarkably helping big corporations to expand their “offering” and contributing to make it more attractive relocating abroad to a constantly increasing number of people.
 
 

Also in this case an individual decision to leave his/her current employer is not triggered by any bad feeling toward this. It goes without saying that whether an employer should be aware that some of their staff would be eager to relocate and work in a different country where the employer has a branch, should an opportunity arise, this should be better previously discussed and eventually offered to an internal employee, rather than being offered directly to an external applicant.

 

Finally

It can be concluded that when an individual leaves his/her employer for internal-environment-related reasons this is due to causes which are actually under the employer direct or indirect control.  This clearly entails that the employer could have averted this type of undesirable event to occur.

 

It is however hardly believable that once an individual has decided to leave the employer might actually persuade this to stay. In order to prevent unwanted occurrences to happen organizational climate, and in some cases individual attitude toward the employer, should be regularly investigated and monitored as a matter of course: prevention is invariably better than cure.

 

By contrast, whenever individuals, for talented and significant these may be for the organization, decide to leave the business by reason of objectively justified grounds, that is, a genuine challenging opportunity coming from the external environment, the employer has nothing to regret and to reproach itself. The only exception being whether this was actually in a position to offer a new challenging role to the individual but didn’t.

 

When reward comes to play

In some instances the worthiness of the reward package received by an individual can cause, reinforce or support his/her decision to leave an organization. Also in this case the drastic employee decision can be justified or be based on endogenous-context-related or exogenous-context-related grounds.
 
 
The internal context
As the equity theory teaches us (Adams, 1963 – 1965), individuals build and develop expectations in terms of reward in the workplace. These expectations are essentially based on the assumption that reward is commensurate with the output yielded by each individual and as such equitable. The tenets at the basis of the equity theory are in turn reinforced by the “distributive justice” theory (Leventhal, 1980), which lays great emphasis on the role of managers and more particularly on the fairness they should use when making decisions about their direct reports pay.
 
Endogenous-environment-related pay issues are typically directly or indirectly linked to bias and unfairness. Individuals are usually unwilling to accept discrepancies in pay levels whenever these are not justified by any means; whereas employees are habitually absolutely willing to accept these whether the individuals receiving higher levels of pay objectively contribute more to the organizational success and yield better tangible results.
 
Employers and managers should hence pay particular attention to this aspect. These theories clearly apply not only to talents, but also and to some extent mostly to the overall organization human capital. Whether employees are performing and behaving as expected by the employer, losing them would just represent a waste of time to replace these and of money to select and train the newcomers.
 
The external context
Ensuring internal equity, and hence not equality, can help employers to retain the existing staff, but can hardly help these to contrast the pressure eventually coming from the exogenous environment.
 
Whether in fact the internal pay rates would not be in line with the rates characterizing the relevant labour market, retaining current employees could just prove to be a sorely tricky feat to attain, never mind attracting new quality individuals.
 
 

Market pricing and, where applicable, market forces have to be hence invariably kept into due consideration. Whether individuals should realize that, irrespective of the fairness applied internally, their pay levels are sensibly lower than those offered in the market, is it is very likely that, especially whether the labour market is tight, these will leave the organization.

 

In order to avert this undesired event to occur employers, by means of reward professionals, should constantly monitor the external labour market and the trends characterizing it. Whether during this activity a gap should be identified, this should be properly investigated and the reward package of the people filling the relevant positions eventually revised.

 

To identify what the real reasons for employees leaving an organization actually are is paramount to gather and collect the necessary data. Exit interviews are definitely the best tool to gather this information and help employers to identify appropriate and effective solutions to contrast the phenomenon.
 
 
Longo, R., (2014), Sometimes employees leave their employers not their managers; HR Professionals, Milan [online].