Employee turnover can be a highly costly burden on small to medium-sized enterprises, but could emerging technologies like artificial intelligence prompt improvements in retention rates?
With the average employee costing an estimated 12,000 to replace for SMEs, instances of high turnover can be severely damaging to operational efficiency.
With around 70% of employee turnover coming as a voluntary decision, it’s a significant challenge for enterprises to manage engagement and satisfaction rates in a way that prevents the rigmarole of continuous job listings and onboarding strategies.
For HR professionals, countering turnover is a frustration that can threaten the long-term growth of businesses. However, there are many measures that can be taken to limit the negative impact of turnover.
Calculating Turnover
Calculating your staff turnover can be a useful way to monitor for emerging trends within your SME while helping to report on current rates.
To do this, find the average number of employees for the period you’re observing while excluding temporary or seasonal staff members for the sake of accuracy. By adding the number of employees at the start of the observation period to those at the end, and then dividing them by two, you can calculate the average number of employees within your business.
Now, to work out the turnover rate, you’ll need to divide the number of employees who left the company by the average number of employees. Finally, multiply the result by 100 to calculate staff turnover as a percentage.
With CIPD suggesting that the average staff turnover rate in the UK is 34%, any figure higher than this should be a suitable cause for revising your employee retention strategy.
The emergence of artificial intelligence has also paved the way for unprecedented control in improving the engagement of enterprise staff, helping to improve the long-term satisfaction of employees.
The AI boom carries some significant implications for employee turnover, and there are many ways in which the technology is already helping to prevent staff from looking elsewhere for work. With this in mind, let’s explore some of the growing use cases of artificial intelligence in action:
Predictive Analytics
Artificial intelligence is capable of performing predictive analytics to forecast potential staff turnover by identifying trends and patterns at a rate that human HR professionals can’t replicate.
For instance, AI could find a correlation between the different management approaches of team leaders and employee disengagement. This can help to refine your SME’s management styles to improve satisfaction levels and offer proactive training or support to your management team.
With 92% of employees recognising the importance of working for an enterprise that values their emotional and physiological well-being, AI tools can also use predictive analytics to monitor work patterns and identify early signs of dissatisfaction before adapting the workloads of affected workers.
These predictive insights can help stamp out instances of burnout, boost engagement, and lead to higher productivity among the workforce.
Appraisal Accuracy
Crucially, 69% of employees claim that receiving regular recognition from their employers would motivate them to work harder and stay longer in their respective roles. This means that optimising your appraisal system should be a priority if your turnover rates are too high.
Artificial intelligence tools are helping to improve retention by empowering HR teams to craft personalised engagement strategies that improve the quality of feedback and recognition for employees.
These real-time feedback loops help to alert management to instances of outperformance, and the ability of AI systems to identify and reward employees for their efforts can help to create a fair reward system that can help all workers enjoy seeing their hard work acknowledged accordingly.
Additionally, artificial intelligence can help to drive more engagement among employees by creating bespoke development plans that match the individual skills, preferences, and career goals of workers to a program designed to enhance their strengths and overcome any weaknesses. This can help to provide a sense of purpose that can prevent instances of ‘quiet quitting’ or turnover.
Personalized Training
Employee training and upskilling can also be a key factor in retention over long periods of time, and AI’s ability to generate personalised, engaging, and accessible learning experiences can form the cornerstone of a more engaged and productive workforce.
By delivering tailored content recommendations based on the monitoring of prospective skill gaps and preferred learning styles, artificial intelligence can deliver relevant and effective training materials.
Because skill gaps can be a leading cause of employee turnover, mitigating these shortcomings can significantly reduce instances of staff quitting SME roles.
AI can also deliver interactive experiences and simulated environments that offer far more engagement than simple text-based training, and the ability to access bespoke models at the click of a button means that employees can enhance their skills in between workloads.
The implementation of AI training can help employees feel more valued and equipped to grow within their roles, boosting their contentment and longevity in their positions.
Boosting Retention
Retaining employees can be a challenge for SMEs with ambitions towards balancing budgets and sustaining growth strategies, but the emergence of artificial intelligence tools can help to deliver greater levels of efficiency in retaining talented staff for longer.
Through predictive analytics and a personalised approach to employee management, training, and appraisals, more SMEs can improve their employee retention, preventing harmful and expensive turnover rates and building a consistent level of productivity into the future.
Embracing AI tools today can make a significant difference in shaping your plans for tomorrow, and building an employee-first culture with the help of technology gives you the best chance of overcoming the challenges that all ambitious enterprises face as they continue to grow.
