Employee Turnover: You Can Reduce It!

One continuing problem for franchisees, particularly in certain franchise industries like restaurants, is high employee turnover – along with the high cost of keeping up with it.  What may make this an even thornier issue for some franchisees is the increase in vacancies at the management level, where high performing managers are in greater demand than ever.

It’s likely that turnover will always be high in certain franchise industry sectors, but there are things you can do to mitigate it.  Let’s look at some best practices that can make a difference.

  • Start by hiring smarter.The best employees you will find have the ability to do the work, are willing to do the work (and if you’re lucky, actually enthusiastic about it) and are coachable and manageable. 

  • These are intangibles you can’t discover just by looking at a resume, so you may need to fine tune your interviewing skills to ask the questions that will help you understand their attitudes and motivation.You can teach skills, but you can’t teach the right attitude.
  • There are a number of best practices that can help you do a better job of hiring.These include job descriptions to clarify roles, written employment applications, structured interviews, background checks, drug screenings and past employment verification.
  • We recommend you have the right policies and procedures in place and make your expectations clear.After you hire a new employee, offer a strong onboarding program, augmented by thorough, consistent training in the specific tasks each employee will be expected to perform.
  • For management positions, experience is very important.However, you’ll want to look beyond their previous experience to learn why they’re interested in your position, how they approach operations and customer service, whether they understand the business side of the franchise and whether your position fits into their career path.

  • Convey your business and customer service philosophies clearly.Employees can’t please you if you don’t define success for them.  Explain why you do what you do and not just what you do.  You want them to see if you’re a good fit for them as well as whether they’re a good fit for you. 
  • Set high performance standards.  When high performance becomes a team commitment, team members will expect it from each other and support each other in achieving it. 
  • Pay a competitive wage with competitive benefits.  Decide what your compensation philosophy is.  Do you want to pay the same as your competitors?  A little more?  A little less?  Sometimes you can be a hero by paying just a little more.  And benefits mean a lot, particularly for employees at the lower end of the pay scale.  Families living paycheck to paycheck can’t afford to get sick and need to know at least a minimal level of benefits will be there for them.
  • Treat them with dignity and respect:  People are important…they deserve respect.  And your franchise’s mission is dependent on people. Your employees are your “face” to customers and in large measure why customers return.  Treat your employees with an attitude of service and lead them by example so they embrace the role of service to others and treat customers with the same high regard. 
  • Show them you value their contributions to the franchise’s success:  Many lower wage employees can’t see how they make much of a difference – unless you tell each of them.
  • Ask their opinions and ask them for customer feedback:  Workers hear what customers really think about your operations, because they are the people who are face to face with customers every day.  They see what works and what doesn’t, so ask them on a regular basis (all hands meetings are a good idea) how to improve operations, and then reward the suggestions that work.
  • Engage them and develop their skills:  Even if there aren’t many opportunities to move up the career ladder, providing cross training will help them develop professionally as well as improve their performance and productivity – while also helping you out in a pinch when you’re short staffed!
  • Recognize them for a job well done:  Take the time to compliment and encourage them individually.  Consider ways to engage employees such as employee recognition programs, company events and even community volunteer projects. 

Too often, we get caught up in our day-to-day operations (the urgent) and forget that it’s our people (the important) who can make or break our business. Keeping that in mind may well help you keep your best employees longer and encourage word of mouth recruitment of new employees. 

Your employees are the most important “make or break” factor in your franchise’s success.  Taking the time to get the proper advice to establish best practices on all aspects of human resource management can put you on the path toward becoming an employer of choice, and most likely a more profitable franchisee.

David Peasall, SPHR, is vice president, benefits and human resources at FrankCrum, a national professional employer organization that provides outsourced human resource services to franchises and other small to mid-sized businesses.


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