{"id":6876,"date":"2020-01-19T07:30:00","date_gmt":"2020-01-19T15:30:00","guid":{"rendered":"https:\/\/bwblogdev.wpengine.com\/people-analytics-reveals-top-reasons-for-attrition-and-it-isnt-compensation\/"},"modified":"2022-12-14T13:32:22","modified_gmt":"2022-12-14T21:32:22","slug":"people-analytics-reveals-top-reasons-for-attrition-and-it-isnt-compensation","status":"publish","type":"post","link":"https:\/\/www.betterworks.com\/magazine\/people-analytics-reveals-top-reasons-for-attrition-and-it-isnt-compensation\/","title":{"rendered":"People Analytics Reveals Top Reasons for Attrition (and It isn’t Compensation)"},"content":{"rendered":"

Attrition is the silent killer that can swiftly disable even the most successful and stable of organizations in a shockingly spare amount of time. While many companies put an emphasis on the costly process of hiring and recruiting, there isn’t enough attention invested in solving the issues that cause top talent to leave. Although compensation is the most commonly associated reason behind attrition, people analytics is able to reveal the true drivers behind attrition, surprising many employers by demonstrating that compensation is not at the top of the list.<\/strong><\/p>\n

Understanding the motivations behind employee attrition<\/a> is the essential first step in understanding the problem and properly addressing it before substantial, long-lasting damage is caused to your organization. Thankfully, technology is now able to provide employers the actionable insights they need to better understand their employees and make any necessary changes before turnover rates swell, productivity drops, and the entire company’s future is suddenly less bright. <\/span><\/p>\n

<\/p>\n

People analytics empowers employers<\/a> with a deeper, much more thorough understanding of their employees and, thus, equips them with the data points needed to identify, analyze, and address the sources of attrition before an organization-wide crisis is formed.<\/span><\/p>\n

With total cost of replacement averaging between <\/span>6 and 9 months of an employee\u2019s total salary<\/span><\/a>, and <\/span>75% of the causes behind attrition being preventable<\/span><\/a>, it is obviously in a company\u2019s best interests to leverage the insights provided by people analytics<\/a> to minimize cost and and increase employee satisfaction to avoid such hazards.<\/span><\/p>\n

Know Your Employees<\/strong><\/span><\/h2>\n

As mentioned, contrary to popular belief, compensation is typically not the primary motivator when an employee chooses to leave an organization. In fact, recent studies have shown that a variety of subtleties can drive attrition. For instance, employment anniversaries, birthdays, class  reunions, and other personal milestones often serve as the trigger point to an employee leaving a company. To that point, job hunting rates rise as much as <\/span>9%, 12%, and 16%<\/span><\/a>, respectively, following these events.<\/span><\/p>\n

This, of course, is a perfect example of implementing people analytics<\/a> and the benefits it can bring to an organization. Historically, these types of data points have been obscured \u2013 at best \u2013 from an employer’s point of view. The ability to transform such subtleties into quantifiable, actionable data \u2013 the very <\/span>insights provided by people analytics<\/span> \u2013 has become an absolute necessity in minimizing attrition and stabilizing an employee base.<\/span><\/span><\/p>\n

The Widespread Impact of Attrition<\/strong><\/span><\/h2>\n

Although the direct costs of replacing an employee to an organization are significant in of themselves \u2013 and still trending upwards due to tight labor markets and the ever-growing collaborative nature of the workforce \u2013 the <\/span>indirect costs can be even more substantial<\/span><\/a>.<\/span><\/p>\n

When an employee leaves an organization, the company not only loses an individual worker but the benefits derived from the working relationship between that employee and their coworkers as well. Furthermore, their specific skill set and knowledge base that might have included an important, singular perspective along with information on customers, vendors, and other significant aspect of operations is also lost. Investing the necessary resources in terms of money, time, and effort to recruit, train, and maintain a replacement can be extraordinarily costly for a company and, under many circumstances, impossible to replicate.<\/span><\/p>\n

 <\/span><\/p>\n

A Light at the End of the Tunnel: People Analytics<\/strong><\/span><\/h2>\n

Fortunately, all is not lost for employer’s trying to minimize the overwhelming costs of attrition. Leveraging the significant insights provided by people analytics<\/a>, companies can now better arm themselves with the information needed to identify potential sources of turnover and address them accordingly.<\/span><\/p>\n

As an example, <\/span>Credit Suisse recently implemented a program<\/a> built upon the data provided by people analytics<\/a> to curb their own attrition issues. By simply using the data that helped identify employees at risk of leaving and alerting those same employees to openings within the company, they were able to reduce attrition by 1%. While this number might not seem significant at first glance, Credit Suisse estimates it saved between $75 million and $100 million in 2014 alone by moving 300 employees to other positions within the company.<\/span><\/p>\n

As Credit Suisse demonstrates, companies are now routinely collecting people data from a variety of different touch points to better understand the many variables at play that impact employee satisfaction and attrition rates. In other words, HR departments are no longer left guessing as to the factors driving employee turnover can now rely on quantitative data provided by people analytics<\/a> to provide a far more reliable sense of direction.<\/span><\/p>\n

Big data can now drive people analytics<\/a> to give HR far more prescient abilities than ever before, providing HR with the data and predictive trends to pinpoint sources of attrition. In certain environments, HR departments are even employing everything from electronic surveillance to complex analysis of employees’ social media feeds to better understand the employee journey and the dynamics that impacts satisfaction levels.<\/span><\/p>\n

To categorize the data collected from these different tools, HR departments have identified particular categories which serve as the key pillars of the employee experience and core reasons behind attrition, including:<\/span><\/p>\n