If we want to manage attrition, the first thing we want to do is really just try and understand it. Why are people leaving? Why do people leave? In some sense we might say, well, it's because they don't like their jobs. Kind of true, but if I leave it there, you may not feel we're getting a lot of value out of this. What more can we say about this? No area where there's been an awful lot of study over the years. Traditionally, what you do here is you go out and survey a bunch of people in an organization, you ask them how they feel about a lot of different aspects of their job and then their work. Then, maybe six months later, maybe a year later, you return, you basically see who left, who stayed, and try to figure out how those differences relate to what they told you earlier. Large number of studies, what I've got here is again what's called a metro analysis, where people have gone through all of the studies to try and summarize, on average, what's the correlation between these different aspects of the job and whether or not people leave. Here, I've got the correlations [inaudible] what they stay. Unless something has reverse on the label of the ball, like withdrawal ideas, what this means is the higher something is, so the higher say organizational commitment is, the more likely they are to stay. What do we see from it? How much people like their job matters? Job satisfaction, when that's higher, correlates about 0.3 with staying in the job. Similarly, organizational commitment. Organizational commitment is issues around I like the organization I work for, I identify with it, I feel some loyalty towards it. Not surprisingly, the more that people feel that about the organization, the more likely they are to stay. We see some other pieces here is also relationships with others. It's often said that people leave managers, they don't leave jobs. Is that true? To some extent. How they feel about their manager, the leadership that correlates with retention, no higher than job satisfaction. I think it would be wrong sets the most important thing, but it certainly matters. How people feel about their peers, that can matter as well. Do I like the colleagues I'm with? If I do, that's a cost to leaving. If I don't like them, that might be a reason to leave. We see again, the happier people are with their colleagues, the more likely they are to stay. Then there's a job itself. Aspects, is it stressful? If the stress is high, I'm going to leave. If the role is clear, I'm more likely to stay. If there's role conflict, I'm being asked to do lots of different things and I don't know which one to do, that's going to make me leave as well. The two we get to at the bottom are interesting. There are more alternative opportunities, have got little reverse there. That means that there are more alternative opportunities are more likely to leave. That makes sense. This isn't just, do I like my job, it's, do I think there's a better job that I could get. One of the most interesting bars here, I think is the one at the bottom, the one that's pay. You see kind of a medium correlation here. It's certainly people who are paid more are more likely to stay, but the effect is definitely less than say liking my manager liking my job. We clearly think of pay as an important lever for retaining people. If attrition is high we think, "Well, are we paying people enough?" But this evidence suggests that maybe it's not the only thing that's going to matter. It's an interesting question why it is that pay is not more important. I think one possibility is I wouldn't move jobs for more pay, but I don't necessarily go searching for jobs because of my pay. On the other hand, if I have a round with my manager, I don't like my job, that's going to force me to search. I think another possibility is that even if people are low-paid in an organization, doesn't necessarily mean they're going to get higher pay somewhere else. But I think what we should take away is that pay is important to attrition, but it would be a bad idea to focus too much on pay. That if we want to manage attrition, there are lots of other things that we need to think about at all. I want to spend just a minute as well talking about the top bar. The top bar is withdrawal ideas. What's this? Basically, I mentioned, we do the study, we go around, we survey people in the organization, we ask them, "Are you thinking of leaving? Are you thinking of staying?" On top of all of these questions about how they like the job. The withdrawal ideas bar is this question. Are you thinking of leaving? Are you planning to go search for another job? Clearly, this does a much better job of predicting whether people leave or whether they stay than anything else. But even 0.6, I mean, that's high for correlation, but it's not determinative. In many ways, I think one of the things that we could take away from this study is as interesting as here. The things that we would expect to predict leaving do predict them, but none of them determine it. One of the things that we see here, see job satisfaction about 0.3. It means there are a lot of people who like their jobs that leave nonetheless. There are a lot of people who don't like their jobs that stay. That suggests beyond just thinking about how much people like their jobs, there may be other things that can inform our approach to attrition. That's what I want to turn to next. If the extent to which I stay in my job or leave isn't just about how much I like my job, what else could it be about? That'll be useful to think about. One way that I think about it, this is about changes. Yes, we can imagine that people leave jobs they don't like. But what's interesting is they took that job in the first place. In order for somebody to leave a job, ultimately something needs to have changed between the time where they thought, yeah, this is a good job to take, I'll take this job, and the time when they decided to leave. What has changed that would make somebody to leave? I've got a list of four things here that I think are worth thinking about. One thing that can change is their perception of their fit with the job. Jobs are sometimes described as experience goods. The idea of an experience good, we don't actually know what it's like until we try it ourselves. With a job, we have some ideas about whether this the right job for us? Am I going to be any good at it? Am I going to enjoy it? But really it's very hard to know whether that's true until we've actually spent time with it. I suspect many of you listening will have had experiences where you took jobs expecting it was going to be a good job for you and after a while realized it was something of a mistake. One reason why we might take a job and then leave it is we didn't really understand what the job was like or we didn't understand enough about ourselves to know if we're going to be good about it or like. This has a couple of implications that make a lot of sense. One is it suggests people often leave fairly early on in a job. We take a job, there's a period where we evaluate, is this the right job for me? If the answer is yes, we'll stay and then we might stay quite a while. If the answer's no, then we'll leave. A lot of that happens at the beginning of the job. The other thing that we see is that people tend to move much more near the beginning of their career. Part of that maybe when I'm just starting work, I don't really know what kind of jobs fit me and I'm more likely to make mistakes. After I've been working before I'll have a better sense of myself in the available jobs out there, I may be more likely to stay. It can certainly be that learning about fit with the job. Even if I fit with the job, there could be other things that happened that made me re-evaluate the job and therefore think about whether or not I want to leave. I may get a poor performance appraisal. For example, there might be a reorganization that forces me to think about how my job is changing and I don't really like that. There are events that can happen within the workplace itself. We know, for example, people are more likely to leave if their manager leaves or if their colleagues leave. That changes the environment for them. Maybe it's less pleasant after that. Sometimes say, people will apply for a promotion and get turned down. There might be things that happen that forced them to re-evaluate, "Well, I thought I liked this job, but now I'm getting new information, the job's changing or what I've been told about my performance is changing, and that's persuading me that I want to leave." A third reason that things can change that might make me think about leaving, is I might be changing my skills. I talked earlier about this. We learn through learning on the job so the time in the job makes us more capable. Some of those skills will be firm-specific, some will be general. We may get general skills training from the organization as well. Chances are once we've been in the job for a while, we better that job than we used to be, and maybe we would be better at other jobs as well. What might have been the best job that I could get when I started off, after two or three years of experience, I may now be in a position where I can sell those skills elsewhere where I can get better jobs. That may mean that after a while this is no longer the best job for me and I want to move. Those career dynamics can drive attrition as well. Again, it's quite possible this job was the best job for me when I took it. Maybe what's changed has not been me but the alternatives. Maybe new employers have come in, I've learned from my friends about other jobs that are better, and so as I find out about these alternatives I didn't know beforehand, that can also persuade me to leave. Another thing that we know is attrition is amazingly what we describe as pro-cyclical. When the economy is doing poorly during recessions, if not a lot of people are hiring, there's much less turnover because people are usually leaving to go to other jobs, need to be hired into it. When the economy is doing well, there are a lot more jobs available, so it's a lot easier for me to find things that might fit me. We find as the number of alternatives go up so does attrition and employers need to think much more about what they're going to do in order to retain their people. These are a variety of reasons why people might move. One of the nice things about this list is it also does give us some sense what are some of the interventions that we might think about if we want to manage down that attrition. I want to turn to that next.
