Here’s an interesting factoid to chew on the next time your organization loses a great employee: Contrary to popular belief, it’s usually not about the money.

According to a study performed by the Saratoga Institute, a leader in third-party exit interviewing, almost 90 percent of managers believe employees leave because they’ve found better-paying jobs. But the study also showed something far more startling: In reality, only 12 percent of employees actually leave for greater financial rewards. And for the remaining 88 percent, there’s little doubt that bad managers play a strong role in prompting them to hit the road.

This remarkable disconnect between perception and reality lends credence to the old adage that employees join companies, but they leave managers. It also speaks volumes about the power of denial — how difficult it is for the very people charged with keeping employees engaged and on board to take responsibility for turnover. This is no small matter, given that some experts believe the cost of staff turnover stands between 50 to 150 percent of an employee’s annual salary, depending on the role and level of seniority.

So what’s the solution if the problem perhaps is, in a word, you? Perhaps you’ll take some advice from consultant Mel Kleiman: Become a magnetic manager — the kind of leader who attracts good employees and keeps them with your company through thick and thin.

Kleiman is the president and founder of Humetrics (www.humetrics.com), a consulting firm in Sugar Land, Texas, that helps companies develop better hiring and retention strategies. He’s also the author of Hire Tough, Manage Easy: How to Find and Hire the Best Hourly Employees and The Five Firsts: A Simple System to On-Board, Engage and Retain Top Talent.

Magnetic power

It’s not always about the money Kleiman says exit surveys show that employees desire the five following things from work: great co-workers, interesting work, growth and opportunity, a family-friendly environment and recognition. And magnetic managers can play a role in enhancing each of those areas by hiring great people for jobs, establishing expectations, holding themselves and their employees accountable, communicating openly and giving credit where credit is due.

“Magnetic managers only let great people in the door,” he emphasizes. “Don’t waste your time on mediocrity — hiring great people will make your job much easier. And set expectations right away … Tell people what you want and what they should expect.”

Many supervisors overlook a simple but powerful tool in their managerial arsenal: recognizing an employee for a job well done. “Our society is addicted to recognition,” he asserts. Yet a Gallup poll shows 60 percent of employees never receive it — even though it’s an easy thing for managers to do, takes little time and doesn’t have to cost even a penny.

When Kleiman speaks at seminars, he often asks attendees if they have ever received a written letter of recognition from a manager.

“Out of 100 people, maybe 15 will raise their hands,” he notes. “And most of them know exactly where that letter is, whether it’s framed and hanging on a wall or in their desk or in a file. That speaks to how valuable it is to them.”

Practice the Five Firsts

What happens on an employee’s first day on the job is also critical to long-term retention. Anyone who disputes that notion should consider the typical first question a new employee gets from a spouse or friends after that critical first eight hours on the clock: How was your day?

“The answer needs to be, ‘Fabulous,’” Kleiman asserts.

To ensure that response, he says managers should follow the first point in what he calls the Five Firsts: Make the first hour of the first day the best hour any employee will ever have on a job.

Most employees start on Mondays, which are feverishly busy. As a result, too many employees are asked to spend hours filling out forms, talking with human resources people or even just drinking coffee until their manager has time to pay attention to them.

“What you should do is ask the new employee to come in an hour early so you can have some uninterrupted time together,” he suggests, noting they usually are pleased by the special treatment. “You only get one chance to make a really good first impression … Make that first hour the best hour they ever had at work, and they won’t realize for six months how bad you are!”

During that hour, be sure to explain why the employee’s job is important to the organization. Also tell them why they were chosen for the job (which, as a bonus, establishes job expectations) and tell them what happens if they don’t do their job well. Then find out how they want to be managed, which establishes an open line of communication, Kleiman says.

“Employees love to be asked how they want to be managed, and managers should love hearing about it,” he notes. “Some people love to have their hands held, and others just want you to give them a target and let them go at it. It’s your job to manage them how they prefer to be managed. It helps hold both you and the employee accountable.”

Managers should also comply with the other four firsts:

• Meet at the end of the first day to find out how things went. “Don’t let them go home frustrated,” Kleiman says.
• Do the same thing at the end of the first week. “The most important thing is communicate, communicate, communicate,” Kleiman emphasizes.
• Give the employee their first paycheck in person, not via direct deposit into a bank account. “This gives you an opportunity to tell them firsthand all the good things they did to earn it,” he points out. “Or maybe to tell them they need to turn it up a notch. If you’re not honest, you’re just setting them up for failure. How can you expect people to do things right if you’re not telling them what they’re doing wrong?”
• Meet again after the first 30 days to review the employee’s first month on the job.

In closing, Kleiman points out that it’s usually the best employees who leave for greener pastures. So to avoid this kind of damaging and costly turnover, managers should honestly take stock of their managerial shortcomings and address areas that require shoring up. Is it easy? No. Will it take discipline and effort? No doubt. But the reward is employees who stick to their managers like steel to a magnet, even if another company offers them a job with a higher salary. Remember, it’s not always about the money.