I had an interesting conversation the other day with a friend of mine about a problem employee. After several attempts to work with him to improve performance, she and her boss have determined that he isn’t making the cut. Great guy. Good employee. Wrong job.

“Are you going to try to move him into a position for which he is better suited?” I asked.

“We tried. But, he doesn’t want to move. Says he loves the department,” she told me. “He’d rather leave the company than move out of the group.”

“If he’s not doing well, then how can he be happy?” I said.

“The guy loves the people he works with - which is part of the problem. He builds great working relationships with his co-workers and his clients, but then spends too much time maintaining them,” she said. “But, that’s the reason everyone likes him. He cares.”

She went on. “And given the nature of our business, his co-workers probably don’t know that his productivity is the lowest in the group and that his errors are the costliest.”

“So, what are you going to do?” I asked.

“We’re going to get through fourth quarter - hopefully without any huge errors - and then address it again in January,” she explained. “I am hoping by then, he realizes he’s in the wrong job and agrees to move. His current position requires too much analysis and that’s not his strength. If he doesn’t accept the transfer, we’ll have to let him go.”

I was surprised she and her boss decided to wait. As it turned out, they were in a tenuous spot.

On the one hand, if they let him go now:

• They fear employee morale will plummet during fourth quarter, negatively impacting sales and productivity.
• They won’t be able to adequately train a replacement because fourth quarter is too busy.
• They will be short-handed during the busiest time of the year.

On the other hand, if they keep him until January:

• They run the risk of a costly error during fourth quarter that will adversely impact sales.
• He may interpret management’s lack of action as a vote of confidence, an affirmation that his work has improved to an acceptable level.

“Basically, I am looking over his shoulder every day and putting out fires. We just can’t risk shaking up the team right now,” she said. “The last thing we want is a mass exodus.”"Do you really think that’s possible?” I said.”I don’t know,” she said. ” Sometimes I wonder if people are just looking for a reason to move on.”

According to a 2005/2006 Employee Satisfaction & Retention Survey, she’s right. The survey, conducted by Salary.com, revealed that 65% of employees are looking for a reason to leave.

Of the more than 13,592 employees surveyed, 65% say they are “somewhat likely” (27 percent) or “very likely” (38 percent) to leave their current jobs within the next three months. According to the survey results, respondents who described themselves as “very likely” to leave are the most likely to act and represent a 50% increase over last year, when only 25% of employees said they were “very likely” to leave within three months.

What do these figures mean for your organization? Regardless of whether you agree that 6 out of 10 people in your company are currently looking to leave, this kind of potential turnover should give you pause.

The true cost of turnover to an organization is often much higher than employers realize. The hard costs are easy to realize. But it’s the soft costs that are more difficult to quantify. Turnover itself is also tricky to analyze. If you have a staff of 20 and you turnover 12 people in a given year, did you actually lose and replace 12 employees and retain only 8? Or did you turn over 4 positions three times and actually retain 16 people?

Both scenarios cost companies money. Yet a company that retains 16 people out of 20 in a year versus 8 out of 20 is healthier and stronger.

Take a few minutes to think about your turnover and retention and the costs associated with it. What you learn may help you create an employee plan that will get you smoothly through fourth quarter and beyond.

Use this handy worksheet to figure out what the cost of turnover is in your organization. How is this affecting your department? Organization? (File is a PDF. Right click on the link to Save File As. Don’t have the Adobe Acrobat Reader? Get it for free, here)

Don’t worry, I’ll wait…

Now you’re done figuring out the cost of turnover, think about this exercise and the estimate of what turnover is costing your organization. How can you impact the cost of turnover? How can you help retain employees and bring those costs down? What can you do?

According to the survey, you can do a lot.

Consider this. When asked for reasons employees stay in their jobs, manager ranks as the second highest reason. And yet, when the survey asked employers what they believe retains people, employers ranked the manager fifth, behind benefits, compensation, co-workers, and culture. That misinterpretation is what leads many managers to believe there’s not much they can do to impact retention.

The bottom line? As a manager, you can positively impact retention by building a solid working relationship with your employees. The things you do can help keep the good ones. And that’s what we’re talking about here. My friend? She’s still hoping to move her employee into another position because sometimes even the good ones are in the wrong job.

For more information about the survey results discussed in this article, go to 2005/2006 Job Satisfaction Survey.

Michele Eby works for Media Partners as a writer and training advisor. She has worked in the training and development field for more than 15 years. Media Partners’ customer retention program, Keeping the Good Ones and the 2005/2006 Employee Satisfaction & Retention Survey conducted by Salary.com were the sources for this article.

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