1. ARC PARTNERSHIP PRESENTATION – SEPTEMBER 21, 2010 BY CARL P. MAERTZ, JR., PH.D. JOHN COOK SCHOOL OF BUSINESS SAINT LOUIS UNIVERSITY Contact at: maertzcp@slu.edu Using the Right Turnover Assessment for the Right Management Purpose

2. An Illustration of the Problem Many or most practitioners would suggest “turnover reasons” measured in exit surveys or interviews as the primary data for the purpose of determining the “whys” of quitting for managing turnover. Practically, reasons/shocks can only be reliably assessed as causes of turnover behavior after the fact, if at all (i.e., intentional deception, format limitations, & memory decay issues threaten validity of reasons measurement) Moreover, this approach makes the questionable assumption that the reasons or shocks that have caused ex-employees to quit are the same as those that will cause current employees to quit.

3. Troubling Facts There is no good research to support this assumption generally. Thus, managers must confirm rather than assume that reasons of past quitters predict the reasons of future quitters. Also, this prediction would only be expected at all if stable aspects of the organizational environment drive the same reasons for employees actually quitting year after year at the company.

4. But even if this is the case, either… (#1) The systematic problem in the environment indicated from measuring reasons was undiscovered, or no one was paying close attention to fixing the problem OR (#2) The problem reason(s) was(were) already dismissed as a necessary evil, or as ‘not a problem’ but part of the business strategy/reality (e.g., below market pay, infrequent raises, dwindling health care benefits, too many contract employees, no free parking, etc.) Only #1 implies any practical use for having collected reason data in exit interviews

5. Overall Conclusions Reasons collected on exit interviews or surveys are of highly questionable value for:  Understanding why employees will quit, and thus for turnover prevention  UNLESS, persistent environmental drivers of reasons exist and have been ignored by managers previously Data from leavers is not enough; Data from current employees must be integrated with it This means using each type & source of data for its most logical and valid purpose

6. Data from Leavers Main Purpose: Assessing avoidability and potential to have controlled the “whys” for particular instances  Reasons “check all” or open-ended  Direct avoidability questions yes/no or open-ended This is a key input, along with job performance and compensation of exiting and replacement EEs & all transition costs, for calculating whether all voluntary instances are dysfunctional or have negative utility Identifying all such instances and where they occurred:  Allows much more precise overall turnover cost estimates  Allows linking negative instances to specific management practices  Allows for potential manager accountability and evaluation

7. Data from Current Employees Main Purpose: Assessing why employees are likely to quit in the near future and why they stay, especially in EEs or groups vital to org. competitiveness  Organizational level: standard motive/attitude surveys  Group level: focus groups or custom surveys  Individual level: interviews or non-anonymous surveys These assessments are the key inputs for:  Designing interventions to prevent quitting  Deciding where these interventions should be best applied under conditions of limited resources

8. Further Notes on Data Sources Current employees cannot be effectively or practically asked, “For what reasons/shocks will you likely quit this company?” Both leavers and current employees have likely participated in regular motive or attitude surveys or focus groups that can be:  Examined in light of reasons leavers give, concordance?  Integrated within group, department, or area for understanding whys within that group Leavers could be given a motive survey at the time of quit, which could also be integrated w/current EEs Leaver reason data can still be useful to reduce turnover if recent patterns of reasons being consistent over time exist and have thus far been ignored