Why do Talented employees leave companies

Posted on: May 23, 2007

Come to think of it. This is almost 100% true. Read below & find out the

Early this year, Arun, an old friend who is a senior software designer,
got an offer from a prestigious international firm to work in its India
operations developing a specialized software. He was thrilled by the

He had heard a lot about the CEO of this company, a charismatic man
often quoted in the business press for his visionary attitude.

The salary was great. The company had all the right systems in place
employee-friendly human resources (HR) policies, a spanking new office,
the very best technology, even a canteen that served superb food.

Twice Arun was sent abroad for training. “My learning curve is the
sharpest it’s ever been,” he said soon after he joined. “It’s a real
high working with such cutting edge technology.”

Last week, less ! than eight months after he joined, Arun walked out of
the job. He has no other offer in hand but he said he couldn’t take it
anymore. Nor, apparently, could several other people in his department
who have also quit recently. The CEO is distressed about the high
employee turnover.

He’s distressed about the money he’s spent in training them. He’s
distressed because he can’t figure out what happened.

Why did this talented employee leave despite a top salary? Arun quit for
the same reason that drives many good people away. The answer lies in
one of the largest studies undertaken by the Gallup Organization.

The study surveyed over a million employees and 80,000 managers and was
published in a book called First Break All The Rules.

It came up with this surprising finding: If you’re losing good
people,look to their immediate supervisor. More th! an any other single
reason, he is the reason people stay and thrive in an organization. And
he’s the reason why they quit, taking their knowledge, experience and
contacts with them. Often, straight to the competition.

“People leave managers not companies,” write the authors Marcus
Buckingham and Curt Coffman. “So much money has been thrown at the
challenge of keeping good people – in the form of better pay, better
perks and better training – when, in the end, turnover is mostly a
manager issue.” If you have a turnover problem, look first to your
managers. Are they driving people away?

Beyond a point, an employee’s primary need has less to do with money,
and more to do with how he’s treated and how valued he feels. Much of
this depends directly on the immediate manager. And yet, bad bosses seem
to happen to good people everywhere. A Fortune magazine survey some
years ago found that nearly 75 per cent of employees have suffered at
the hands of difficult superiors. You can leave one job to find – you
guessed it, another wolf in a pin-stripe suit in the next one.

Of all the workplace stressors, a bad boss is possibly the worst,
directly impacting the emotional health and productivity of employees.
Here are some all-too common tales from the battlefield:

Dev, an engineer, still shudders as he recalls the almost daily firings
his boss subjected him to, usually in front of his subordinates. His
boss emasculated him with personal, insulting remarks. In the face of
such rage, Dev completely lost the courage to speak up. But when he
reached home depressed, he poured himself a few drinks, and magically,
became as abusive as the boss himself. Only, it would come out on his
wife and children. Not only was his work life in the doldrums, his
marriage began cracking up too.

Another employee Rajat recalls the Chinese torture his boss put him
through after a minor disagreement. He cut him off completely. He
bypassed him in any decision that needed to be taken. “He stopped
sending me any papers or files,” says Rajat. “It was humiliating sitting
at an empty table. I knew nothing and no one told me anything.” Unable
to bear this corporate Siberia, he finally quit.

HR experts say that of all the abuses, employees find public humiliation
the most intolerable. The first time, an employee may not leave, but a
thought has been planted. The second time, that thought gets
strengthened. The third time, he starts looking for another job. When
people cannot retort openly in anger, they do so by passive aggression.
By digging their heels in and slowing down. By doing only what they are
told to do and no more. By omitting to give the boss crucial

Dev says: “If you work for a jerk, you basically want to get him into
trouble. You don’t have your heart and soul in the job.”

Different managers can stress out employees in different ways – by being
too controlling, too suspicious, too pushy, too critical, too nit-picky.
But they forget that workers are not fixed assets, they are free agents.
When this goes on too long, an employee will quit – often over seemingly
trivial issue.

It isn’t the 100th blow that knocks a good man down. It’s the 99 that
went before. And while it’s true that people leave jobs for all kinds
of reasons – for better opportunities or for circumstantial reasons,
many who leave would have stayed – had it not been for one man
constantly telling them, as Arun’s boss did: “You are dispensable. I can
find dozens like you.”

While it seems like there are plenty of other fish especially in today’s
waters, consider for a moment the cost of losing a talented employee.

There’s the cost of finding a replacement. The cost of training the
replacement. The cost of not having someone to do the job in the

The loss of clients and contacts the person had with the industry. The
loss! of morale in co-workers. The loss of trade secrets this person may
now share with others. Plus, of course, the loss of the company’s
reputation. Every person who leaves a corporation then becomes its
ambassador, for better or for worse.

We all know of large IT companies that people would love to join and
large television companies few want to go near. In both cases,
formeremployees have left to tell their tales.

“Any company trying to compete must figure out a way to engage the mind
of every employee,” Jack Welch of GE once said. Much of a company’s
value lies “between the ears of its employees”. If it’s bleeding talent,
it’s bleeding value. Unfortunately, many senior executives busy
travelling the world, signing new deals and developing a vision for the
company, have little idea of what may be going on at home.

That deep within an organization that otherwise does all the right
things, one man could be driving its best people away.


7 Responses to "Why do Talented employees leave companies"

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In relation to the thread you might find this article on interest.

You would think that with all the energy, time and money invested in recruiting senior executives or Directors that most would succeed. Sadly that isn’t the case. Indeed statistics from the USA indicate that over 40% of executives in a new job begin to fail within their first few months and some research records an even higher failure rate. (1)

The problem is even more acute when we consider that most Directors will move jobs and possibly companies a number of times during their working lives. Each change brings with it the same risk of failure.

The cost of such failure can be enormous for the individual. Reputations and careers can be lost and the consequences for an organisation catastrophic. Indeed I know of one financial services company in Hertfordshire that was so traumatised by the failure of a newly appointed sales Director that within two years it had to find a company to rescue it. The new Sales Director was sacked, the Managing Director lost his job and many staff made redundant. (2)

The reason for the failure was that the new Sales Director:

a) Ignored and even derided the corporate culture as being too paternalistic.
b) Chose to ignore the existence of informal networks and communication channels.
c) Believed that he could force through change by force despite real concerns over the merits of some of his proposals.
d) Ruined his credibility by belittling anyone in the organisation who argued against his plans to create change.

One could expect that with so many basic mistakes the consequences were obvious. One could even add that the Director was stupid and the company negligent for allowing such actions. It’s easy with hindsight!

It’s worth considering, however, that most companies don’t have a plan for working with a new Director or senior Manager once they have been appointed and more especially after promotion. The risk of failure begins when the Human Resources department feel that their work is done once a vacant position has been filled. Induction processes are not followed because the new jobholder’s experience or seniority would seem to make it unnecessary or time wasted.

Managing Directors will often add to the chance of failure by appointing a senior executive and then withdrawing to allow the new jobholder as much freedom of action as possible. Only becoming involved again when things are clearly going wrong and the situation is already at crisis point.

The new appointee increases the chance of failure still further. They know that they have little time to prove themselves. Cutting corners to save time would seem to be an appropriate course of action. As a result they look for a series of “quick wins” that can demonstrate their competence to their superiors.

In attempting to create quick wins the new Director will often attempt to airlift policies, processes and systems that have worked for them in the past without taking account of the organisational, professional and geographic cultures that exist.

Consider this analogy. If we moved from London to Singapore we would need to understand all three types of culture before we could properly settle into our new way of life. This would need help and time to observe and understand how things worked. But why do so many companies expect a Director moving from one company, with all the differences in culture, need any less support or in achieving corporate goals.

So what should new Executives do? Firstly there is the need to build credibility. But there needs to be an understanding, from all parties, that it’s almost impossible within the first few weeks to have any measurable impact upon performance. There should, however, be opportunities to score a series of small victories that signal that things are about to change.

The thing to remember is that early actions have a disproportionate impact upon the way that new Directors are perceived. So it’s worth considering what are the messages that need to be conveyed.

The next action that needs to be taken is to consider what perceptions about the new Director should be conveyed before attitudes begin to harden.

Finally there should be consideration for how the messages will be conveyed. Should they be by personal briefing, video, email or letter?

Once people believe that the new Director understands them and will act in their best interests and the interests of the company, even when there are difficult decisions to make, the risk of failure reduces rapidly.

(1) Anne Fisher, “Don’t blow your new job”, Fortune, 22 June 1998
Stephen Harvard Davis “Culture can destroy progress” Training Journal June 2000

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