Employee Turnover and Its Impact on Performance

Employee Turnover and Its Impact on Performance

Employees are regarded a critical resource for any organization. For this reason, the relevance of effective employee turnover management cannot be overstated. In this text, I concern myself with employee turnover. In so doing, I will amongst other things discuss the effects of a high employee turnover, i.e. how a high employee turnover affects employee performance particularly at the National Archives and Records Administration - NARA. Further, I will also highlight the various causes of employee turnover and the measures the management should embrace to rein in the same.

Employee Turnover: An Overview

Employee turnover according to Armstrong (2010) is essentially the rate at which employees leave the company. According to Saratoga Institute (as cited in Deane and Sanjeev, 2004), "turnover is calculated as the number of employee terminations in a given period -- voluntary, involuntary or both -- divided by the average number of active employees during the same period." Voluntary turnover according to Goldstein and Hersen (2000) is when the employee initiates the separation. On the other hand, involuntary turnover comes about when the separation is initiated by the company (Goldstein and Hersen, 2000).

Effects of a High Turnover on Employee Performance

It is important to note from the onset that in addition to being financially costly, a high employee turnover also does hurt efficiency. To begin with, a significantly high employee turnover rate could effectively lower the morale of employees and hence their performance. Indeed, Gitman and McDaniel (2008) identify turnover and absenteeism as two of the main morale and performance killers that employees need to be on the lookout for. As the authors further point out, the morale of other employees is significantly affected as they watch their workmates leave. This is particularly the case given that over time, employees tend to build a close emotional connection with those they closely relate with at the workplace. Thus in reference to NARA, a high turnover of supervisors could lower the morale and hence performance of employees. This could particularly happen in those instances where employees have close working relations with the leaving supervisors.

Secondly, it should also be noted that when supervisors leave, the organization may have to hire replacements immediately so as not to hinder operations. Those hired in this case could be lacking the necessary skills as well as experience to effectively execute the various functions of their new position. As Armstrong (2010) points out, as new employees are being trained; the organization does experience significant losses in terms of output. This is more so the case given that the new employees may not be familiar with the culture of the organization as those they replace. In regard to NARA, as a new supervisor is trained, work teams could report decreased productivity. For this reason, the effectiveness of the affected divisions could inevitably suffer.

Resistance to change on the part of the employees left could be yet another reason as to why a high turnover of supervisors could negatively affect performance. The said resistance to change in this case could be caused by what Griffin and Moorhead (2011) refer to as the fear of the unknown. Some individuals according to the authors "fear anything unfamiliar" (Griffin and Moorhead, 2011). Employees in this case could refuse to give the new appointee the maximum support and/or attention he or she needs. This they could do by ignoring directions or resorting to outright sabotage.

It is however important to note that in addition to the costs I have indicated above, a high employee turnover rate could also have a number of other negative consequences including but not limited to additional costs. The additional costs in this case could either be replacement or preventive. Replacement costs are associated with finding new employees and for this reason; they include job advert costs, interviewing expenses, etc. (Armstrong, 2010). On the other hand, preventive costs are associated with the measures the organization puts in place in a bid to prevent employees from leaving. Preventive costs with regard to NARA may include salary increments, cost of building better housing facilities, etc.

Causes of Employee Turnover

To be able to effectively manage employee turnover, the top leadership of NARA should first identify the possible causes of employee turnover. From the onset, it is important to note that individuals could choose to leave NARA for a wide range of reasons. Jackson, Schuler, and Warner (2011) identify four key causes of staff turnover. These cases include dissatisfaction with the job, conditions in the labor market, poor human resource practices, and other role commitments (Jackson, Schuler and Warner, 2011). To begin with, when it comes to low job satisfaction, the authors are convinced that some employees deem it fit to pursue their careers elsewhere as a result of dislike for the job they do, bad working relations with their superiors, or even work-related stress. In that regard, supervisors at NARA could be leaving as a result of low job satisfaction brought about by the factors I have already mentioned.

When it comes to conditions in the labor market, Jackson, Schuler, and Warner (2011) point out that existing conditions in the labor market such as; aggressive recruitment practices on the part of competitors or even the availability of better opportunities elsewhere could motivate employees to leave. For instance, in regard to NARA, a top performing employee could be headhunted and given a hefty pay package as well as benefits by competitors for him or her to leave the organization.

Fourth, poor human resource practices could be yet another reason as to why employees elect to seek employment elsewhere. The said practices in this case could include but they are not limited to little recognition and low compensation, unavailability of opportunities for career development, unfair practices at the workstation, etc. It is therefore possible that some employees working for NARA may consider pursuing their careers elsewhere should they feel that they are being treated unfairly or that the opportunities available for career development are too few.

Other role commitments in relation to community and family could according to Jackson, Schuler, and Warner (2011) be to blame for employee turnover. For instance, when it comes to family, an employee could at some point in time find it hard to strike a balance between familial and work-related responsibilities. In such a case, the concerned employee may elect to quit employment so as to attend to other roles and responsibilities. This could be a cause of employee turnover at NARA.