Question

Your last thought question deals with analyzing a management problem. Read the following situation and factors, then write what you would do to solve the problem.

Situation: You are a manager in a retail business that employees 100 employees. You have recently discovered that there has been a sharp and significant loss of staff due to employee turnover. Not only does your business run the risk of lower quality customer service but your bottom line is threatened by the increased costs of recruiting, hiring, and training new employees. You have taken on the job of analyzing the causes of the turnover and identifying possible solutions.

Factors:

1) There has been recent turnover in the middle management team. A few have taken early retirement and have been replaced by new managers.

2) Better economic conditions have resulted in a surge of new business. You are gaining new customers rapidly and they are buying more merchandise producing a higher need to restock shelves with inventory.

3) This same economic upturn has resulted in a more competitive job market.

Question: What would you do to pinpoint the most important causes of employee turnover and what would you recommend as solutions to upper management? Defend your recommendations. Remember that you have an influx of new business that might go away if you do not provide quality customer service.

Answer 1

I think the two important causes of high employee turnover are:

• Lucrative job offers in other companies which means that the employees are not happy with their current pay and the incentives in the company.
• The case of managers taking early retirement might be because of job dissatisfaction among the managers.

To solve these two problems, and to reduce the cost of recruiting new employees in the face of the competitive market, the company must:

• Provide attractive salary packages, added incentives like flexible working hours, more holidays to enjoy family time and create an overall productive working environment in the office which leads to an efficient workforce.
• To cure the boredom among the managers, they should be presented with more challenging roles in the company and should be given work that satisfies their inner desires and needs through their work.

These will ensure that the workforce of the employee becomes its loyal asset and works towards driving the company to greater heights.