The daily problems an IT manager has to solve are so diverse that it is hardly possible to classify them in order of importance or difficulty. But one of the recurring problems that managers in many companies face is turnover of people. For some companies turnover of staff is a chronic disease that causes more trouble and leads to more problems than any other issue, including competition or market changes.
Turnover is bad for business because when valuable people leave, the gap due to their absence cannot be always filled. Although there are no people (no matter how talented or important they are) that cannot be replaced, practice shows that very often it is difficult to find an adequate replacement on time and to have smooth transition. This is a managerial problem in any sectors, not only IT, although in other businesses it might be much easier to find with less concussion for the business a replacement for people who leave. But when employee’s skills, knowledge or personality are important, finding the right replacement can be tricky.
Even in businesses that do not demand so many skills and knowledge from their workers, turnover impacts business in a negative way. For instance, waiters and cooks are valuable “assets” because very often clients are attracted or repulsed more by the personality of the waiter or by the meals the chef prepares than by the brand name or the furnishing of the restaurant. In such cases when a “star” waiter or cook leaves, part of the clientele goes away to the new place where the waiter or the cook starts work, thus stealing clients in addition to making the work process more difficult for his or her previous employer.
Well, for IT companies it might be a bit better – at least a former employee of an IT company cannot steal customers if there are long-term commitments from existing customers or if the clauses in his or her contract forbid working with current company customers but the skills gap left behind him or her might be absolutely enough. In any case, when people leave in bulk, this is a symptom and there is food for thought about the (real) reasons that make them do it.
But if people are not leaving, does this mean that they are satisfied with their jobs, do them properly and everything is fine? Should you happy that you have the most loyal employees in the world and that your business will prosper? If turnover is a symptom not a cause, when there are no symptoms does this mean there is no cause? It is equally important to know what the real reasons for leaving the company and for staying with it are.
It could be that everything is fine and that is what keeps your people with you for years. In fact, it is not a rare case. But it is also not an exception that lack of turnover is a symptom of another disease. People are not leaving not because they are satisfied with their job or are loyal to the company but for a more prosaic reason – no better or no any other opportunity. If this is the reason for having them with you, you might have more grounds for anxiety than for happiness.
Although when asked directly what they like in their job, people return answers like: “It is a challenging job.”, “I like the team and the management.”, “It gives me satisfaction and prospects for personal and professional development”, “My company needs me and I am eager to stay as long as I am useful”, you need not believe all this. More or less, these answers are politically correct and they are what you expect to hear. Such answers are intended to please your ears and even if they are true, there might be other reasons, in addition to the statements below, that have been stopping many people from leaving. As I already mentioned above, one such reason is lack of no other or no better opportunity in the short-term or in the long run. If people stay with you because of no other opportunity, this can be due to several reasons:
1. business is down and other companies are not hiring
2. your employees have so specific skills and knowledge that there are a couple of other companies (probably in another state or country) only where they could go and ask for a job
3. they are overpaid and stay because for the job they do they get more money than anybody else will offer them
4. your employees have no skills and knowledge that can be sold to another employer for a decent price
This list includes only some possible reasons that keep people from leaving you. There might be tens other reasons that make people accept temporarily or permanently a job they dislike. Also, it is possible that employees’ motivation is composed of more than one items from the above list. But in any case, you as an employer should be cautious when you know that people stay with because of no other alternative.
If it is 1., take it as inevitable that there will be people who will leave the company when economy goes up. If it is 2., this could be good for you because people who have specific skills that are not so popular on the market and like their job tend to be loyal. Unless something unpredictable happens, for instance family matters arise or the employee decides that he or she might like his job but still needs development and new skills, the people from group 2. could be core of your company.
Unlike 2., groups 3. and 4. are definitely not reasons for optimism because in both cases although employees formally stay with the company, they hardly contribute to its development. If people are overpaid, you can expect that doing their job will come secondary to trying to keep their salary. When keeping their position and salary are of primary importance to them, you can expect that such people will make more efforts to eliminate everything that threatens their position (including “competitors” – other employees that are doing their job diligently and whom you can use to substitute the overpaid individuals) than perform their duties. Since you hardly need a civil war in your team in addition to paying more money than deserved, you will be happier to see the overpaid employees leave the company voluntarily. Dealing with overpaid employees who are not willing to quit is tricky because even if you decrease their salary, they still might not leave but will resort to passive forms of protest, rather than voice their actual feelings.
The least reason for happiness when there is no turnover of people is 4. This is a most unfavorable situation and a serious reason for thought because it can be difficult for the company to go ahead with the burden of people who are not contributing but are mainly consuming other people’s contribution. It is very different from 2. – your employees stay with you because it is meaningless to look for other alternatives. In a word – no turnover because what is left cannot be sold to another company and is yours forever is not a reason to be happy.
This schematic representation of the reasons that make people stay is neither complete, nor exhaustive. But since very often turnover is (correctly) associated with problems and lack of turnover of people is (wrongly) associated with lack of problems, my idea was to show that turnover is a symptom, not a cause, therefore it is naïve to think that when there is no turnover, everything is covered with roses. It is more difficult to diagnose correctly the disease when obvious symptoms are missing but no doubt it is much better to know in advance that even when symptoms are still invisible, there is a cause that needs to be cured.
so, with turnover the correct question might not be if it is bad or good but who is leaving and who is staying – people who contribute or people who consume. If people who contribute are leaving, this is bad; if people who contribute are staying, you can be happy. Similarly, if people who consume are staying, no reason to be cheerful. You should be happy when they leave, although this might never happen voluntarily.