October 28, 2021
How to Achieve Workforce Stabilization and Efficiency
In Order to Develop an Environment Where Contributors Thrive, Your Workforce Must be Able to Count on Some Basic Things
In the last two articles, I wrote on the key elements of talent acquisition and employee engagement that are vital components to reaching an optimal level of workforce stabilization. But is workforce stabilization truly attainable in today’s ever-changing and challenging labor market?
I believe so. But in order to develop an environment where contributors thrive, your workforce must be able to count on some basic things. First, is role clarity. Employees want to know what is expected of them, how are they evaluated in their job and how does their role impact what the company does. After role clarity, employees care about and need timely and regular feedback on their performance. My guidance is that the more basic or entry level a role is, the more frequent the touchpoints need to be with that employee, especially during their first six to nine months. The final pieces include appropriate resource allocation and a high level of attention to how work is structured and performed. Most employees, regardless of position, find it challenging to do their best work when the work environment feels unstable or is constantly changing. By providing employees with the necessary tools and training to do their job effectively, along with leadership’s involvement in ensuring that the work environment, culture and individual workstations align with the needs of the employees, stabilization can be attained.
So why is achieving worker stabilization critical to a company’s success?
Research has proven that highly-engaged workers create a safer work environment, and produce a higher quality and quantity of work, a combination that ultimately decreases costs and improves a company’s bottom line. In other words, when a company stabilizes its workforce and builds engagement, it has the capacity to drive process improvements and lean initiatives that create efficiency, eliminate waste and drive labor cost per unit down.
What factors impact a company’s ability to attain workforce stabilization?
The largest factor is attrition, especially with key, skilled roles and entry-level, task-repetitive jobs. High turnover is expensive for companies to manage since they must go through the recruitment, selection and hiring process all over again. New employees also need to be trained, which costs time and money. And because new employees can't immediately deliver the same sales or production results, there’s a lost opportunity cost associated with turnover.
Morale in high-turnover companies is also typically weak. Culture is the shared norms and values of the employees who work together. Motivating employees to share a common vision and to perform at high levels is challenging when employees are leaving. Workplace relationships are key to an employee's satisfaction level. As friends and co-workers leave, remaining employees constantly must cycle through the process of getting to know new employees, which impacts their overall perception of the company and their coworkers.
High turnover reduces the level of experience across the organization. Employees with less knowledge and less experience within their jobs won't produce as well. In production environments, when efficiency levels suffer, labor cost per unit rises and contributes to a downward spiral that can be tough for companies to overcome. Poor performance and low efficiency lead to waste, increased labor costs and poor business results, which force companies to stop investing in training and other forward-looking employee activities.
Finally, it’s common for front-line managers to get frustrated with the revolving door atmosphere turnover creates. When managers find themself spending most of their time hiring and training new employees, they can’t focus on coaching and developing the tenured staff. This cycle significantly contributes to longer-term employees feeling overlooked, overworked, frustrated and ultimately leaving. Plus, poorly equipped and underdeveloped employees force managers to be hands-on in the business, which takes them away from decision-making and supervisory duties.
Chronic turnover requires focus to fix. For companies without the internal bandwidth or time to tackle this, leveraging a third-party consultant to analyze its workforce practices and to identify areas for change may be a solution to stabilization. LandrumHR Workforce Management offers a gap analysis assessment that focuses specifically on identifying root cause issues, inefficiencies, and roadblocks that create instability while developing a plan to help you reach workforce stabilization.
About the author:
Jim Howe is the Vice President of Workforce Solutions for LandrumHR. With more than 20 years of experience in the staffing industry, Jim works in tandem with his clients to implement workforce management solutions focused on attracting, engaging and retaining the right workforce. LandrumHR Workforce Solutions connects hundreds of companies with talented job seekers. If you are seeking employees, or looking for solutions related to high turnover, hiring, recruiting, safety, or managing multiple labor suppliers in today’s economic landscape, LandrumHR can help you improve retention, engagement, production, safety, efficiency and reduce labor cost per unit. Please feel free to contact me at firstname.lastname@example.org to get started.
Read the article on scdigest.com.