64 Percent Turnover... Sometimes That's Pretty Good...

Want to see a HR Pro judge another HR Pro?  Tell them you've got 64% turnover.  Resist the urge to slash tires when they respond that they've got 8% turnover.  I mean that - resist the urge to cause bodily harm as they crinkle their nose, because they know not what they speak of.

Most don't get the business behind the turnover numbers.  Here's my list of pet peeves regarding HR pros and turnover:

1.  Turnover is relative, and most HR Managers in organizations don't understand that, especially if they've never worked in a high turnover business.  Retail, big box call centers and hard knock life production environments are all examples of places where 40% turnover can mean you're best in class.

2.  HR Pros don't understand that money drives turnover.  Do the jobs you have lead or bring up the rear of the market with turnover?  If you pay $9/hour in your call center and the market says $10.50, budget for turnover and evaluate your business plan for talent costs at least annually.  Still want to pay $9?  OK, just make sure everyone knows that turnover is going to run 70-100%.  It's a business decision. Maybe not a great business decision, but a business decision, nonetheless.  Sue Messinger couldn't get turnover below 60% under those $$ circumstances.

3.  HR pros really don't have a great understanding of how to calculate turnover.  I send my turnover calculator out about 20 times a month on email request, and let's just say the fact that you need to annualize your turnover to give people an accurate understanding of how many bodies are flowing out of the building is not a well known fact.  Example - if you have 100 people in your company, and you lost 2 this month, your annualized turnover is 24%, not 2%.  You have to annualize it to understand if the trend doesn't stop, annualized turnover is the number you'll lose once the year ends.  I'm not being crtical of those who haven't been exposed to that, just don't judge those with higher numbers who report it accurately.

What's got me thinking about Turnover?  I picked up the following Newsweek interview with Brian Dunn, CEO of Best Buy.  64% turnover among camera and phone jockeys sounded pretty good to me.

NEWSWEEK: What do you recall of your first day at Best Buy?
DUNN: It was a Saturday. I hit the sales floor and proceeded to not really understand all the items I was trying to sell to the customers, and it was a series of very difficult exchanges. At the end of the day, the store manager came up to me and said, "How did it go?" I told him in very direct terms it was a lousy experience. The manager proceeded to talk to me about the Minnesota Twins, the Minnesota Vikings, fishing … He made it personal right away, and then he said, "Why don't you come in next Saturday morning and I'll teach you a little bit about how I operated on the sales floor." And it really made a difference. What stuck with me from that was that the store manager was talking to me about what I was capable of doing here, and was willing to give of himself to help.

Exactly how high is your turnover?
It's about 64 percent annually, and that's a number we're quite proud of. Four years ago it was over 100 percent, and we've been very systematically working on improving our employee experience and engaging our employees in a way that can bring those numbers down. Embedded in that big number are pretty interesting smaller numbers. Our store-manager turnover is in the teens. That's really important because the store managers are the architects of the environments they lead. Our full-time employee turnover is in the high 30 percent range, and that's a really important number because they're doing a lot of training.

Those Dunn guys always sound credible, don't they? 

Retail's a hard knock life, and 64% isn't bad.  To channel Jeff Foxworthy, "if you've ever judged a turnover statistic without first thinking about the business or department in question, you might be a non-business savvy HR administrator dressed as a HR pro".