The Human Capital Report (HCR) includes workforce reporting outputs over the employment life cycle. This report is underpinned by the WRDI® survey, which measures employees’ effort, affective commitment / engagement, satisfaction, and retention risk, plus a diagnosis of what may be contributing to deficits. The HCR Report provides predictive data and risk profiles for the workforce, “sliced and diced” according to the examples below, offering deeper insights concerning the state of the workforce. This performance and retention related data, presented in a unique format, including an estimate of the numbers of people who are likely to stay or leave in the ensuing 6-12 months, and associated costs, constitutes an essential element of workforce planning.
What we can measure
Why this is important?
New recruits are the highest “at risk” group in terms of turnover. It is important that:
- what has been offered (i.e., the promise of the “deal”) is delivered
- there are some objective measures in place to assess the adequacy of selection, recruitment and induction policies
- selection and recruitment practices are producing good person–job and good person-organisational fit.
It is becoming increasingly more important to conserve people resources, to optimise their performance and retention, with appropriate people management strategies, policies and practices. The labour and skills shortage will become more exacerbated, with turnover increasing as people will have more choices. The 2 key drivers of retention are also 2 key drivers of performance. Relying on historical turnover data as an accurate predictor of future trends is fraught with disaster. It is essential to have predictive and diagnostic data as a risk mitigation strategy.
With the growth of search firms, high performers will increasingly become more targeted in the future, with their loss posing significant risk to the achievement of business and strategic objectives. Generally, low performers are more likely to leave compared to high performers. There is typically a 20% pay buffer or cushion for people who are engaged and satisfied before they start to seriously consider leaving for a better offer.
There is a clear link between leadership, employee engagement, satisfaction and retention. It is important to have data that traces that link, as a basis for determining the effectiveness of past leadership initiatives and for future leadership investment decisions.
People leave organisations for the 3 P’s:
- Push or dysfunctional organisational factors or limitations (approx 60% of turnover)
- Pull (approx 20% of turnover)
- Personal (approx 20% of turnover)
It is important to be able to identify reasons for turnover according to the 3P classification, and to minimise push and combat pull.
- Length of time in job
- Length of time with organisation
- Age or Generation
- Gender
- Education level
By determining the engagement and retention risk profiles of various groups, targeted interventions can be applied to address that risk. For example, different engagement and retention strategies apply to Generation Y compared to Baby Boomers or imminent retirees.
- Criticals (e.g. managers, designers).
- Professionals, skilled or semi-skilled (e.g. nurses, accountants, project engineers).
- Doers (e.g. manual labourers, admin people, front line staff).
- Specialists (e.g. train drivers, defence, air traffic controllers).
Segmentation is a critical concept with marketers – different clients and products have different values. In the case of the workforce, not everyone is equal - a “one size fits all” approach to people management policies and practices is obsolete. Skills are the new currency, with different categories of employees requiring different levels of investment (i.e., “make” versus “buy” decisions, including outsourcing), and different relationships or psychological contracts. The implications of a Critical leaving are much more severe compared to a Doer leaving.
- Classification (e.g. SES, APS 2-4, APS 5-6)
- Military, especially concerning intention to stay in relation to imminent contract renewal
This is another variation on the above workforce segmentation concept, where for example, engagement and retention strategies will differ for SES versus lower job levels. (For the military, we may need to change some of the terms in the questionnaire, eg, ‘job’ may need to be ‘posting’, etc, but otherwise the WRDI should work just as well as for civilians).
- business unit
- specific work areas
- job level
- location
This reporting provides a rigorous basis for the identification of organisational “hot spots”, the application of targeted interventions to address deficits, and maximum use of resources, rather than applying interventions to work groups that may not be necessary.
- By profession (e.g. engineers, lawyers, accountants)
- By nature of work (e.g. field vs clerical)
With the labour and skills shortages, some professions will be affected more than others. Market forces will become more influential in determining salary levels of various professions, with internal salary relativities becoming somewhat obsolete. Therefore it is important to assess risk profiles of various work roles, and apply targeted interventions to address that risk.