Ask any entrepreneur to list her most pressing business concerns, and there’s a good chance employee retention is on the shortlist—if it isn’t at the top. It’s an issue that affects even the most successful of firms; in fact, it was one of the most common worries cited by 2013 PROFIT 500 CEOs.
We live in a service-based economy, where the success of companies in even the most transactional of sectors rests heavily on its ability to keep good employees. That’s why we see so many firms invest so heavily in perks, flexible work arrangements and engagement-driving activities designed at keeping the best and brightest on the payroll.
For most SMEs, retention-driving efforts are preventive measures, designed to keep everyone content enough to prevent defection. At one PROFIT 500 firm, for instance, managers constantly approach staff one-on-one to gauge satisfaction: “We make sure that’s our mandate, our focus,” says the CEO.
At another, the culture is designed to to be open enough for staff to voice satisfaction levels: “We do a lot of meeting together, we listen to the advice of each employee, and we don’t behave as if we’re superior to the employees,” says the CEO. “Because we have such good relationships with staff, as soon as good things or bad things happen, we are sure to know it.”
Such efforts tend to be based more on management intuition and workplace scuttlebutt than on data.
Several companies hope to change that. Deloitte has just launched a new analytics tool that uses data to help companies determine who is going to leave, when they are likely to do so and what management can do to help them change their minds. According to the consultancy, the tool uses advanced analytics “that can predict turnover risk at the individual level” while also giving senior executives the lead time they need to address retention challenges and keep their leading performers.
The Deloitte offering is the latest in a line of service offerings from companies that promise to help firms predict turnover, through data, in-house research or some combination of the two. Academics have been in on the action, too, developing plenty of research models to pinpoint exactly what makes people stick around.
It’s certainly promising to think that big data can help solve one of the most perennial headaches of running a business. But will it actually work? Given how finely nuanced employee satisfaction can be among SMEs—depending so heavily on workplace culture, employee/employer dynamics, local labour markets, industry competitiveness and countless other factors—do you think it’s even possible to predict staff turnover?
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