No matter how thorough and thoughtful our staffing processes may be, staff absences and some staff turnover in all businesses are inevitable. Are you prepared if a department manager requires a leave of absence to care for a family member? What will you do if a key employee accepts another job? 

Planning for unexpected changes in the staff’s short-term and long-term life events can save you and other employees from undue stress, errors and lost productivity. Some studies show that replacing an entry-level position can cost up to 40% of the employee’s annual salary, and replacing a management position can cost up to 100% of the annual salary or more. In this current employment market, it may take much longer to fill jobs, driving the cost of turnover to unprecedented highs. 

You may be thinking that you don’t have a turnover problem and, if that is so, congratulations! Unfortunately, this can sometimes be a guessing game if you aren’t tracking turnover regularly. The first step in planning is consistent measuring and tracking of staff exits, both voluntary and involuntary, by using an annualized turnover formula. The best way to track turnover trends consistently is to calculate and compare annualized numbers, either monthly or quarterly, along with reasons for termination. Are employees leaving because of pay, benefits, lack of opportunity or dissatisfaction with a supervisor? Don’t assume you know the answer — ask the employee before they leave. Tracking turnover by department can also be valuable in narrowing down the root cause of staff turnover. This simple Excel turnover calculator is a helpful tool.

The next step in planning for unexpected turnover is determining the critical tasks in each department that must be covered if an employee leaves the co-op or starts a leave of absence. Work with each department to begin cross-training with other employees on critical tasks before it is needed. You don’t want to discover that no one knows how or when to do the milk order when you are completely out of milk for the week! The long-term goal is to develop a succession plan for all management and administrative positions. Making sure critical tasks in each department are covered is a good first step. Refer to the May 2021 Talent Development Update and scroll down to read the article “Are You Doing Things Differently? Time to Document!” Additionally, we encourage you to explore NCG’s preferred practices resources for guidance on documenting processes throughout the co-op to help with cross-training.

What to do about turnover is a complicated question that many employers struggle with every day. Start with the analysis of:

• Recruiting practices
• Employee experience from application through year one of working at the co-op
• Learning and development practices
• Advancement opportunities
• Pay and benefits programs

While these areas may be the tip of the iceberg, a thorough review may lead to the problems below the surface that are driving staff turnover.