Handling resignations can be a tough process especially when it’s the top employees who are leaving. Searching for the best replacement for that soon-to-be-vacant role is the most challenging part of the process. So, as much as possible, you want to prevent them from leaving and ensure that employee turnover remains acceptably low for your company.
There is a very common fallacy stating that people don’t quit jobs, they quit managers. That’s definitely the case in many corporations and large organizations with tens of thousands of people and tons of different management layers.
Managers are important. But in large organizations, their roles are even more crucial with so many people and teams in need of someone to step up, lead, or just get people to work together for a common goal.
Recent studies about McDonald’s and other fast-food chains disclosed that one of their main problems is finding supervisors and people who can actually run the operations at their respective branches. It may seem easy but it isn’t a job that everyone is capable of doing.
An MBA wouldn’t really work for McDonald’s for various reasons. What normally happens is that these fast food chains promote staff internally—some of their top staff working on the bar or in the kitchen. But, it’s really a hit or miss game.
In smaller companies, that’s not always the case. Inexperienced managers, founders, and executives may contribute to the reason an employee is leaving but there are also several other reasons to take into account.
According to a study by Gallup, these are the reasons why your employees may be quitting.
- Career advancement or promotional opportunities: 32%
- Pay/benefits: 22%
- Lack of fit to job: 20.2%
- The general work environment: 17%
- Flexibility/scheduling: 8%
- Job security: 2%
Knowing these possible reasons is vital in putting together measures that will prevent your top employees from leaving or help you handle such exodus effectively.
Let’s first discuss the common reasons why top employees leave a company.
Promotions and Career Advancement
32% said that career advancement or promotion opportunities are the leading reason for quitting a job.
This makes a lot of sense at the beginning of one’s career especially the first year or two as they’re still going through their first junior positions and onboarding period.
It may take a while for an organization to properly react and gauge a new hire. From a business standpoint, it makes a lot of sense: the company invests months, if not a year in training. The new hire is rarely profitable during the first months while:
- Undergoing training
- Making mistakes
- Working under a supervisor or a mentor
- Taking on simple activities (and not complete assignments)
- Going through reviewal and editorial processes
- Taking much longer to get the job done
This disparity between the company’s long initial investment and the expectations of an employee often leads to lucrative opportunities by businesses eager to grow and hand out job offers to people who are already employed (and willing to make the leap).
Additionally, smaller businesses may pose a career growth ceiling—be it through opportunities to grow in leadership or complexity of problems faced at work.
Pay and Benefits
Of course, salaries or bigger pay opportunities are really lucrative for various people. So that’s definitely one of the leading reasons why they would quit—to choose the greener pasture.
There are two types of employees: those who are purely money-driven and willing to job-hop continuously whenever an opportunity arises, and some that aren’t as tempted by dividends alone but still realistically reviewing job opportunities with a serious bump compared to their existing paycheck.
Aside from the monthly or annual salary, other job perks may contribute to making a similar decision. Free gym memberships, additional health insurance, extra days off, a separate office space, or free lunch are among the perks that larger companies don’t hesitate to introduce as hiring benefits.
Lack of Fit
A person could simply be not a good fit for the job requirement in the job description.
Oftentimes, this is a mutual decision. The candidate may be feeling disconnected from the team, with recurring reviews or critical feedback from management for job assignments or culture-related reasons.
The hire may feel isolated compared to other team members, too. This may involve the lack of interest in the current processes or products, career opportunities and work expectations to get there, or misalignments with management priorities.
General Work Environment
There’s a certain overlap with the third reason, although this is solely related to management issues or the work environment the hire has to perform at.
On one hand, toxic traits may be the culprit here. A toxic environment is hard to thrive in and doesn’t leave a lot to invest in from a professional perspective. Even if it’s not intentionally toxic, misalignment between the corporate vision and the moral principles of the employee may escalate over time.
Moreover, not every hire is a great fit for an organization. While interviewing processes are designed to filter both hard skills and culture fit, it’s not always trivial to gauge that over an interview or two.
The real test commences during the first couple of weeks and new challenges may arise during major shifts on a company level.
With COVID-19 around, remote opportunities have exploded. However, not every company may operate remotely. And in addition to commuting or odd working hours, this poses numerous challenges for companies trying to keep their top team members around during tough times.
Even if remote work is available (or not being a consideration), piling up meetings may be exhausting.
Taking a couple of hours off as needed may require coordination, while easy-going jobs with long sprints and lack of emergencies or support requests would easily allow this form of flexible hours.
One more reason why top employees would quit is that they are looking for job security elsewhere.
They must have felt that they couldn’t find it within your company, so they look for other opportunities where they can see themselves growing and staying for a long time without having to worry if they would lose their job all of a sudden.
This is why companies provide a career development plan that will guide their people in determining their career path within the organization.
Now, although we have already identified the reasons WHY employees leave, an equally important piece of information that you need to know is HOW employees leave.
In a survey discussed on Harvard Business Review, Professors Anthony C. Klotz and Mark C. Bolino went over the different resignation styles of most employees.
The chart shows that the two most common styles by which employees resign is “by the book” and “perfunctory.” By-the-book resignations are formal resignations that give proper notice and explanation to superiors. Although somewhat similar, perfunctory resignations are those resignations that only give short notice without proper explanation.
Some employees resign on a great note by going for the grateful approach of resigning wherein they express their appreciation for the job and proactively extend offer to help with the transition. These are positive ways employees resign.
There are instances, even more frequent at times, when employees resign on a negative note. They can be avoidant, impulsive, or burn bridges at worst.
You’d be glad to catch a top employee who is still “in the loop”. Employees who would go for this approach first give you time to convince them to stay as they are still contemplating on resigning. Or perhaps, they help you prepare sufficiently for when they leave by letting you know ahead of time about their plans of resigning before actualizing it.
Now that we have already laid out the leading reasons and ways employees leave, let’s dive deep into how you can deal with employees resigning.
There are three separate circumstances that play a significant role in handling the leave of a key player.
Failing to predict, plan, and manage each one of them would result in a certain amount of stress or overload for the team. It’s extremely challenging for smaller teams and organizations in particular since they can’t afford to manage a team of hundreds of people in charge of the same type of activity.
In general, employees, clients, and even partners, usually have an “expiration date”. Sooner or later, most will leave. Accepting the inevitable will make it easier to focus on your strengths and opportunities instead.
These are the three phases:
- Creating the leadership team and identifying that person as someone who’s a part of the leadership team
- Working with the key player throughout the period of time in order to analyze what happened
- Handling the leave itself
Finally, let’s discuss further how you can deal with resignations in every phase.
1. Creating and Shaping Your Leadership Team
This is the initial step before identifying the key player(s) on the team.
Top players are hardly hired as such. Most have started small and worked hard continuously until they grew to a certain point. The senior management or a founder has increased the scope of their work and responsibilities and made them valuable in the first place.
That’s not necessarily a bad thing. But this is also the entry point of delegating to someone else as much as possible.
Shaping the key players consists of identifying their traits and motivation, allocating the right type of work, and securing the outcome in the long run.
One of the important things to figure out is why have you identified this person as a part of the leadership team. Be it a team leader, an A-player, a manager, or someone you trust. It’s important to understand why people were chosen for leadership roles in the first place so you can evaluate the situation as a whole.
It’s critical that you evaluate the situation because if someone leaves the company, there may be a reason that’s pretty much the same for others who may be inclined to leave the company as well. It’s going to become a bigger problem when more people are leaving that could have been prevented.
Here are the things you need to investigate:
- How did you select them?
- Did they undergo proper onboarding?
- Were they a good fit for the skills?
- Or, were they promoted because of the hierarchy?
This also helps when hiring new people. You need to follow the same checklist and make sure that you’re allocating the right type of work for the next person on the leadership team.
2. Working Alongside Your Leadership Hire
This phase concludes the last months (or 1–2 years) of the key player working within the organization.
It’s just as strategic as it may influence the final decision of the employee. We talk a lot about the lifetime value of a customer but often neglect the turnover rate of our team members.
It’s also a convoluted process that depends on trust, leadership skills, and managerial experience, aligning the company goals and opportunities with one’s desires. Regardless, carefully planning and executing this phase may lead to a success story (player sticking around until an exit or for a decade) or at least expand the duration of the contract to another couple of years.
Most managers or business leaders when they find a great fit, they promote them. They give them a rough onboarding process and then they expect to offload all the responsibilities to this person.
Now, this may really be a double-edged sword simply because people may not necessarily study the same way, they may not be comfortable with that specific process, or they may need more time. There are tons of reasons for someone who has just been promoted to management or has become some part of the leadership team. When you allocate more responsibilities too early, they may actually crack under the pressure. They may drop productivity due to paperwork.
Understanding the processes and workflows that a new leadership hire undertakes is crucial in identifying the flaws of your onboarding. When you know the weakest points of your onboarding plan, you can easily distinguish warning signals and refine your processes.
You will also know early on if that person is about to leave the job but haven’t had the conversation with you yet or just haven’t had an open conversation to try to sort things out. Being able to rectify this is always best before it’s already too late.
But, having contingencies in place in regular meetings and so on with the team is probably going to alleviate that at least for future employees.
3. Handling the Leave
When you’ve already done all that you could do to stop the person from leaving, then it’s necessary that you handle the leave effectively.
You are losing a key player. That’s it.
But here’s what would make the process more manageable:
- Make sure that you haven’t assigned too many responsibilities to your employee.
- Also, try to distribute responsibilities to at least 2 people on your team, 3 or more is preferable.
- Have everything well-documented in order to take over or reassign to someone else.
- Ensure that your contract is solid (you’re safe against data leaks, security breaches, clients going straight to your former employee).
- Try to extend the duration of the leave as much as possible if it makes sense. Sometimes it can be arranged legally (a 3-month upfront notice or more, options plan that would keep them around).
- Include some training/onboarding time during the transition phase to another team member.
- Make sure you part ways on a good note.
Whenever someone is leaving, make sure you don’t have too much stuff assigned to them because they’re probably already dissatisfied and demotivated and whatnot and aren’t really going to deliver the way they used to do when they were in their top peak.
A professional relationship works both ways.
Now it may seem stupid because it’s a top performer we are talking about. But sometimes, depending on some emotional or relational factors, there may be some form of a backlash—like when a top competitor asks the employee who is about to leave to sell. You can prevent this from happening by securing a contract that explicitly protects your company.
You may try to extend the duration of the leave if that makes sense—sometimes, it doesn’t. Sometimes, just letting people go right away makes sense. But for the most part, if you are parting ways in good terms, it makes sense for this person to improve documentation, help onboard other people on the team, prepare different checklists, or whatever it is as a part of the offloading process itself.
In a nutshell, you want to be less dependent on individuals, allocate assignments to more people working alongside, have everything documented, and keep the good tone, and try to extend the relationship. If you receive a resignation letter, having everything else sorted upfront should let you transition with no significant pressure for the firm.
So those are the main things you need to take care of when a top employee is leaving. What you really need to make sure is that if they have to leave, these people are leaving on good terms. It’s never good to burn bridges unless someone has violated ethical or moral rules.