A high turnover rate is not a good look for a company and can mean several things. It could be a sign of a difficult workplace, poor hiring standards, or any number of issues. Either way, it can create a bad reputation for the company, particularly for outside observers. Tesla, for instance, despite its reputation as ground-breaking company in the automotive sector, is also garnering a reputation of being a near-impossible place to work. Dane Butswinkas, Tesla’s general counsel, left the automaker only two months after joining, the latest in a year full of departures of senior executives. Reasons for the high turn vary from talk of a negative company culture to founder and CEO Elon Musk being a challenging boss to work for.
Take the Hint
Even if you’d like to keep your company’s turmoil a secret, job review sites like Glassdoor make this difficult because they offer a peek inside your business culture. Despite the unintentional airing of dirty laundry – especially in this era of social media – it could be a blessing in disguise. If you recognize a trend in the negative reviews from former employees, perhaps it’s something to recognize and acknowledge. See what the common denominator is and try to find a way to improve things. Don’t let potential long-term employees slip away by burying your head in the sand and writing it all off as the grumblings of disgruntled former employees. If most of the critical comments come back to the same point or points, use it as an opportunity to strengthen your company by acknowledging the criticism and doing something about it. You’ll strengthen your business and dispel the negativity.
As a recruiter, transparency from a candidate makes a good impression. The reverse is also true when it comes to sharing a part of the company’s identity. Be upfront and honest about positions offered, details of the contractual agreements, and whether the position is temporary or permanent. Circumstances may change, and what was once advertised as a full-time position may have turned into a part-time one. It’s understandable, and perhaps a bit of a letdown for a prospective employee. It’s always better to let the job candidate know in advance rather than during a job interview, let alone their first day on the job.
Address the Issue
Netflix utilizes what’s called the “keeper test,” which they use to measure the value of an employee. A manager is supposed to ask: “If one of the members of the team was thinking of leaving for another firm, would I try hard to keep them from leaving?” If not, that employee is let go.
Although this is the case at Netflix, the company tends to give the reason for termination as “poor cultural fit.” Due to this, Netflix has nurtured a company culture of endless and ruthless evaluation, where if an employee isn’t the very best at their role, they could be gone at a moment’s notice.
An environment like this could put employees on edge, making them nervous about their job security. As demoralizing as this sort of environment is for many, others would thrive in it. If your business cultivates a specific culture like this, it’s something that potential hires should know as early in the process as possible so they can make their decision. It will make it easier to find the standout few who thrive in an intense, competitive setting.
It’s widely known that many creative, innovative bosses can be the most difficult people to work for, like Musk and Steve Jobs. In such cases, the price to be paid is that many employees will opt to leave the company rather than put up with it. As Robert Bies, a professor of management at Georgetown University told The Wall Street Journal, “Leaders are complex figures sending multiple signals at the same time… With [Steve] Jobs, there is plenty of evidence of abuse. But you can see that he’s a motivator. He was pushing the envelope for excellence in products.”
Whether you’re the cause of this sort of tension, or a manager tasked with dealing with the fallout, you should be aware of the strain this can cause. Or at the very least, make it lucrative for the employee who decides to endure it.
Alex Correa | Staff Writer