Truth in turnover: The benefits of exit interviews

Staff turnover can be a highly negative and disruptive event in any workplace, which is why understanding and assessing why employees are leaving is important.

Can you really trust the information you receive in an exit interview?

Anecdotally, yes. Sitting face-to-face with an employee who is leaving the organisation, most of us would like to think we’d get the truth, or at least some truths.

That’s the case for Irene Wong, HR and business support manager at Universal Biosensors, who says the exit interviews she’s carried out have been “honest and frank”.

“I’ve found some very honest opinions about things that happen around the company,” she says.

Nonetheless, Wong acknowledges she may not necessarily get the whole truth. “It’d be foolish of me to say that all the answers will be 100 per cent correct. There are going to be people who, because they’re unhappy with their manager, are going to exaggerate the issues or the problems they’ve faced.”

Employees are less enthusiastic about exit interviews. More than 60% don’t believe that people provide honest feedback, according SEEK research. But then only 20% of those surveyed had ever sat through an exit interview. Of those who had, 32% found it to be a positive experience while 21% found it to be negative. The remainder had no opinion either way.

Why the negativity? It might be because most (74%) didn’t think the company would be taking any action based on the feedback. And they may be right.

A survey in the United States has found that less than a third of companies acted on the data collected in exit interviews. “In other words, most companies ignore the strategic value of exit interviews,” concluded the Harvard Business Review article.

It pays to ask and act

Staff turnover can be a highly negative and disruptive event in an organisation, not to mention the expense. The rule-of-thumb is that the cost of replacing a staff member is around 150 per cent of the person’s salary.

So it’s a no-brainer that collecting and analysing data on why employees are leaving is important.

In fact, it’s a “gold mine” for organisations, says Professor Carol Kulik, a self-professed fan of exit interviews.

“It really breaks my heart that exit interviews have become this pro-forma thing and no one’s doing anything with the data,” says Kulik, the research professor of human resource management at the University of South Australia Business School, and a senior researcher in the Centre for Workplace Excellence.

She says it’s important to recognise that exit interviews aren’t about the person who is leaving, “they’re about the next person”.

“You’re trying to find out why people have left so you can look at exit patterns across people and identify trouble areas in your organisations or common reasons why people leave.”

It’s not why you think

There’s been a big shift in understanding of why people leave organisations among academic management researchers.

Most thought that people progressively became more and more dissatisfied with their current role until they started looking for another job but Kulik says it’s now understood that that’s just one of the reasons and sometimes the other reasons are a bigger problem for organisations.

One reason for leaving is the planned exit. “You might have people who intended to leave your organisation from the day you hired them; they were only doing this job until they got accepted into law school, their partner got a promotion or their kid started college,” says Kulik.

If you know that in advance, you can include roles that are designed to be short term, says Kulik. “Then you can plan for some of the turnover and you’re not caught by surprise when it happens.”

Another common reason for leaving is known in the management literature as “shock-induced turnover”. It’s when the employee has no intention of leaving until a critical event makes them consider it.

It could be, for example, a call from a headhunter, a bad performance review or a new supervisor.

“These events are really interesting to study because the turnover that results happens really fast,” says Kulik.

“People who are dissatisfied may stay in your organisation for years before they look for a job or find a suitable alternative. People who leave because of a shock, leave overnight.

She recommends asking particular questions in the exit interview that are less about job satisfaction (“you can easily pick that up in your yearly climate survey”) and more about getting to the heart of the issue.

“What you want to learn about is: what happened that made you think about leaving when you weren’t thinking about leaving before? After this event occurred, is there something we could have done to keep you?

“In response to those sorts of questions, people will say things like: my workload changed and I started doing these tasks that I didn’t want to do,” says Kulik.

“If that’s a valuable employee you’d like to keep, you might have a chance to re-organise the tasks,” she says.

Don’t leave it until the end

Gathering information about employee turnover from exit interviews is undoubtedly a valuable exercise, says Kulik, but don’t forget other strategies.

The annual climate survey usually elicits answers that are too general, she says, but some organisations are carrying out more frequent “pulse surveys” to track employees’ reactions to certain events such as restructuring.

“If you have managers that are really well trained in developmental kinds of performance reviews, who are really good at having candid conversations with employees, who might be able to surface the very early signs of dissatisfaction and be prepared to do some negotiation for a valued employee, maybe exit interviews aren’t as necessary,” Kulik says.

Source: Independent research conducted by Survey Sampling International (SSI) on behalf of SEEK. Interviewing 4,800 Australians annually with data weighted to be nationally representative of age, gender, location, employment status and income (based on ABS).