People - Employee Engagement & Retention (Strategy) Flashcards
An organization seeks to evaluate the overall business impact of its employee retention strategies. What engagement metric would provide this insight?
Revenue per employee
Revenue per employee evaluates the costs of a lost employee due to voluntary or involuntary turnover. Employee absence rate and monthly voluntary turnover rate measure employee absences and voluntary turnover respectively, but not the resulting business effect. Yield ratio focuses on employee engagement initiatives.
HR is asked to evaluate the organization’s overall retention. Which would be the best information for HR to assess first?
How the current turnover rate compares to the industry average
Employee turnover has several unquantifiable costs besides recruiting, retaining, and retraining new employees. A starting point in evaluating retention is understanding employee turnover—the number of employees leaving, why they leave, and the impact those departures have on the organization’s productivity and overall business performance.
How will using a revenue-per-employee metric allow HR to demonstrate the impact of turnover on employee engagement?
A decrease in revenue per employee may correlate with lower employee engagement.
A decrease in revenue per employee may correlate with a decrease in employee engagement. This is especially important when evaluating the cost of a lost employee due to turnover. Although there is no single calculation for measuring engagement, HR can measure specific outcomes of engagement action plans.
Which metric should an organization look to when evaluating an employee engagement strategy that is focused on safety?
Workers’ compensation incident rate
While each of the metrics may assist in assessing employee engagement, the workers’ compensation incident rate is the metric most closely tied to safety initiatives.
A plant manager informs the HR manager that employees are leaving due to limited advancement opportunities. What is the first step the HR manager should take?
Review exit interview data to see if it reflects limited promotional opportunities leading to employees leaving the organization.
The first step for the HR manager is to see if data supports this assumption. Exit interview data can help in this regard, as individuals are more apt to be honest about reasons for leaving an organization as they leave.
A HR VP is concerned that the employee engagement plan, enacted a year ago, is ineffective. What is the most useful thing to consider when attempting to determine if the strategy has been successful?
Comparing the turnover rate for the year to the previous year
In order to determine if the new employee engagement strategy is effective, the HR VP should look for any associated change in the turnover rate from a period of time before the strategy was enacted. The strategy could be having a positive effect but the organization may still have below-industry-average turnover rates. Simply analyzing the total cost of turnover or looking at which positions turned over wouldn’t indicate whether the strategy is effective, although analyzing the positions that turned over may assist in focusing the strategy to perform better with relation to problem areas of the organization.
Which is the best results-based comparative analysis for a company that has implemented an engagement strategy and action plan for reducing accidents on the job?
Compare the workers’ compensation incident rate before and after implementing the engagement action plan.
The specific metric needed to identify a reduction of accidents on the job would be the workers’ compensation incident rate.
A CEO prides herself on cutting costs that do not have measurable benefits or a perceived value to the organization’s financial success. She is now threatening to cut funding to employee engagement initiatives. Which is the best way for HR to demonstrate return on investment of employee engagement budgets?
Tie the investments made in employee engagement back to the profitability of the company.
If the CEO’s complaint is that employee engagement provides no benefits, HR must be prepared to defend the budget by demonstrating the return on employee engagement dollars. There is no specific calculation for measuring engagement, but engaged employees can result in increases in income associated with increased productivity and decreased expenses. Looking at employee absence rates, workers’ compensation rates, and voluntary turnover rates (and the associated costs with training new employees to replace departing employees) can also help demonstrate return on investment for employee engagement efforts.
Which statement best explains how absenteeism is related to employee engagement?
Absenteeism rates can be an indirect indicator of employee engagement, as employees are not attending work.
Absenteeism rates, particularly for unscheduled absenteeism, can be an indicator of potential engagement problems. This can reflect employees’ desire to not be in the workplace.
A new HR director is reviewing retention rates and is concerned that the employee engagement plan that was implemented a year ago is ineffective. Which indicator should the director look to when beginning to assess if the employee engagement plan is working?
Current turnover rate compared to previous years
When evaluating the effectiveness of a new employee engagement plan, the most valuable indicator to look at is how the turnover rate has changed since the plan was implemented. If the rate has improved, it might indicate that the plan is effective.
An organization implements an onboarding program to reduce voluntary turnover rates that are significantly higher than benchmarked averages. Which is the best metric HR should use to assess the strategic success of the new onboarding program?
Information on the performance of new hires
The performance of new employees is an appropriate strategic metric to measure onboarding success. For example, information on new hires who are not performing up to expectations and whether they have been dealt with appropriately can improve time to productivity and engagement.
