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Turnover

Our solution to the problem

Between 2001 and 2014 the average turnover was 10-12%, nowadays this number has grown to 30%, but there are companies where the turnover is 60%, or even as high as 100%.
Everything has changed: the content of the workforce, their motivation, their engagements, the tools for recruiting and retention etc. In many cases the most important thing is the manager’s attitude, how humane or how cold it is.

There is a Hungarian manufacturing company where the incorrectly handled turnover causes 140 million forint annually in additional costs. In case of a company with 300 workers, every percentage of turnover means an extra 2 million forints annually in unnecessary costs. This amount can increase to 3 million forints for every percent where the turnover is above 40%.

The turnover is a monster, which deteriorates efficiency, accelerates burning out, impedes production and puts the various departments into a negative spiral.

We can guarantee that within 6 months we can achieve a 20% decrease in your turnover rate or bring it under the industry average without increasing your costs.
 

In 2 months we reduced the turnover from 25% to 12% at a West-Transdanubian car industrial manufacturer with 400 workers. Furthermore, we changed negative attitude group leaders into committed, well accepted managers.

 

3 main people from an 8 people HR team quit at the same time. We handled this critical situation in 1 month. Today, the team is stable, the atmosphere is good, the cooperation is smooth and the team expanded with 2 employees.

At an electronics production company with 250 workers, production targets were unmet continuously (the weekly performance was only 92%). Unreliable performance was coupled with a demotivated team. With our help, the weekly performance grew to 104% in 3 months, that is 12% points. The cooperation between managers and employees improved spectacularly, a core group evolved in the production, on which the organization can build.

If at your company or even in just one of your departments the turnover exceeds 20%, then you should address the problem, otherwise it will become a monster, which consumes your time and energy.


The Evolution Method for the Turnover handling

 

Salaries

  • Are we in the industry’s regional average? If not, then leftovers remain. Nowadays, the labor shortage is so large that the companies compete for valuable labor not only in the local cities and counties but across entire Hungary. Other companies provide accomodation for their employees and in some cases even provide meals from time to time. Moreover, they bring employees from abroad.

  • Every component of the compensation package counts: cafeteria, bonus, Erzsébet voucher, accommodation or housing supplement. Potential employees calculate the exact amount of money that they receive in a month and what kind of extra expenses they have due to the job. Net 5-10.000 HUF can be decisive.

  • The salary is not everything. If the other components are set incorrectly, then even with a competitive salary 100% turnover can happen. An attractive salary is inevitable to obtain the workforce, but it is not enough to keep them.

  • More and more of our clients entrust us to make a complete regional benchmark, in which we invite companies in the same industry and measure their wage habits. The participants can reach and use the data in front of their decision makers in Hungary and abroad too. 

It is possible to reach a 10% turnover under 3 months.


Assessments

  • As the first step, we conduct an employee commitment survey to see where the organization stands. We quantify everything.

  • 98% of the employees who have worked for the company for years and quite do so after long deliberation with complex reasons and several factors. Do not think it is just the salary!

  • We analyze the turnover data from salary statistics and exit interviews. We establish trends. We make conclusions from them and we base the developmental needs on the findings.

  • In order to have quality results, besides quantitative data, we conduct personal interviews with managers and employees. In most cases the reasons of the turnover are communication, misunderstanding, or a manager’s focus on costs.

  • HR professionals usually have a good feel as to what should be done in these situations and they realize their ideas to a certain point, but the expected results never come. Because these things are not enough. The turnover monster can be killed only on a strategic level with the entire organization and managers working against it together. We can place the managers on our side with only objective facts, data and concrete solutions.

If we manage to decrease the turnover by 10% we can save 10 million HUF at a 300 headcount company.


Key people

  • We identify the key people in terms of organizational and individual importance. At production companies these are the group leaders, at service providers these are the X generation leaders.

  • We analyze how we can involve the key people or develop them in a way which can provide concrete help in their work (practice, and not theory) Ventilation – brainstorming – case studies.

  • We can reach the best results with the production leaders if we evaluate actual cases. They are the ones who have daily contact with the employees and can influence how the workers see the company and its leadership. They also see the commitment of their staff. It is important to use the same language between the leaders and their team during the development, without the common language the skills development’s efficiency will be zero.

  • At service provider companies (company and the employee) the most essential part is identifying common values, and increasing the awareness of these.

Communication

  • No matter how we think about our communication, most likely our employees do not feel or think the same.

  • We consider the frequency, the quality and the channels of the organizational communication.

  • We examine how we can provide a two-way communication in the company, possibly through employees having regular opportunities to share their opinions in a town hall setting or open hour format, and management sharing information on organizational goals, directions, any changes ahead, and operational results. All of this should happen in a simple everyday dialogue in with a common language all employees can understand (literally in case of foreign leaders and employees). If there is no communication from the top, rumors start to spread.

  • In case of production companies there are 4 generations, in case of service providers there are 2-3 generations who work together. Each generation needs a different communication language and channel. We should create forums through which we can cover most (90%) of the employees.

Turnover expense can be 11 million HUF in case of a developer engineer with a gross salary of 600.000 HUF


Generations

  • To reach out to Y and Z generations, there is a bigger need for employer branding

  • Authentic environment (we advertise what is truly happening) and being a „cool” company is now an expectation.

  • The employee commitment decreased from 10 years to 2-3 years, like a project work.