A systematic analysis of the impact, causes, and potential solutions for employee turnover in a manufacturing organization

Sue Collier Lowe

Abstract

It's not who you hire that counts, it's who you keep (TRI-AD, 1998, p. 1). When a company loses a competent employee, all of the money invested in that individual leaves with him or her. Many newly hired replacement employees must start at the lower end of the learning curve, which costs a company in the loss of quality and production time. The purpose of this study was to conduct a systematic analysis of the impact of causes of, and potential solutions for employee turnover in a medium-sized manufacturing organization. In addition, the research outcome or the turnover analysis process may be useful to other companies and add to the present academic research addressing employee turnover. The researcher incorporated qualitative research methods for cause determination and utilized quantitative research to confirm or reject the qualitative findings. The objectives of this research were to: (1) Measure the existing financial impact of employee turnover on a manufacturing organization; (2) Identify work-related and external economic opportunity factors that cause turnover within the company; (3) Identify possible employee turnover solutions derived from the analyzed data and calculate a projected return on investment for the study site; and (4) Recommend solutions for the reduction in turnover rates and determine the forecasted return on investment. The findings indicated that the causes of employee turnover were systemic, and that organizations could keep good employees with a holistic, long-term, retention strategy. This turnover evaluation process provides an instrument for practitioners to use in analyzing the turnover phenomena in their organizations. The process will aid academics by adding to the research base on employee turnover.