Aztek Financial Services Organisation
The human resource department is issuing a strategic plan for next year regarding the structure of Aztek Financial Services
Turnover and Reasons for Improving Retention
The primary purpose of this report is to address the level of turnover and possible solutions to improve retention. Currently the turnover rate is 25% with a high focus of turnover in entry level jobs due to two factors.
The first one is the lack of progression within the organisation. Aztek Financial Services is a medium sized organisation with a flat organisational structure with few middle management making it very competitive for entry level agents to progress. Employees see the lack of progression opportunity and seek career advancement elsewhere.
The second factor been the lack of job security due to rumours regarding restructuring of the organisation. The lack of job security is effecting the performance at all levels leaving employee with a feeling of uncertainty and resentment.
The basis of the retention strategy is minimising overall employee turnover but more importantly is that the organisation influences who stays and who leaves. (Armstrong and Taylor, 2018)
Other reasons for improving retention is to reduce cost and increase moral. Retaining a positive and motivated staff is vital to an organisation’s success. High employee turnover increases expenses and has a negative effect on the organisations morale. Implementing an employee retention program is an effective way of making sure key workers remain employed while maintaining job performance and productivity (smallbusiness.chron.com)
The organisation will focus on lowering the turnover level. We know that two of the main reasons for turnover are lack of progression and job uncertainty within the company. Our retention strategy will have a strong focus on improving communication to help employees deal with changes and investing in upskilling and training and development opportunities.
Improving communication and feedback— Keeping open lines of communication is essential, direct reports should be able to come to managers with ideas or question. It is important that while the organisation is going through change they must keep staff informed as much as possible to avoid feeding the rumour mill. All big announcements must be made face to face.
Employee Engagement -Conducting briefings weekly with all staff to ensure they are aware of what is happening within the organisation. Briefings are a great way of improving engagement and communication between staff and managers.
Employee focus group will be made up of one person per department. This person will be selected by their teams as a voice to represent them. They will meet once a month with management to discuss upcoming events and changes within the organisation. This meeting will give the employees their chance to voice any concerns from fellow colleagues and seek solutions were possible.
Introducing training and development – We know the second reason for turnover is due to the lack of progression. All employees should be aware of opportunities of advancement. This will be a focused on during professional management, help identify promotion and upskilling opportunities for employees.
Upskilling – High turnover can be very expensive and bad for an organizations reputation. Human Resources are looking at strategies towards upskilling our current staff in order to increase productivity.
These strategies will include workshops, further education, eLearning and feedback sessions on what could be improved within the organisation. Upskilling staff will give them better understanding of their roles and give them a sense of empowerment. Although upskilling is a benefit to the employee it is also a benefit to the company as it is cost effective.
Recruitment and Selection – Internal recruitment will take place before going externally, new roles across the entire company will be advertised internally first. If employees are looking for a move, they will have the opportunity to look within the organisation first before leaving.
Compensation and benefits – The organisation is going to move forward with our employees and promote tuition reimbursement and continuing education training. Strict policies will be but in place, the area of study is related and included essential skills for the employees to carry out their job. For employees to be eligible for the benefit the employee must be with the organisation a minimum of one year and provide two years’ service to avoid any clawback
Life Work Balance
We will promote flexi time, compact work weeks to employee and parental leave.
Performance bonus will continue to be awarded at the end of each year we will also include and achievement award for employee. This will be awarded at the end of the quarter. This will entail vouchers such as meals, movies or shopping vouchers to the value of €150. Certificate will be presented to the winner by a member of senior management. Employees will be nominated by fellow staff and final decision will be down to management
Organisation Downsizing Successfully
Human Resources have begun forecasting the future requirement and implications that the new structural changes will have on the organisation. Identifying an action plan to help downsize the organisation. Human Resources will be focusing on the Data Services Department as 75% of that function will be outsourced to Asia. The data service function will need to cut approx. 150 jobs from the organisation.
Methods that will be looked at to help downsize will be redundancies., reskilling/ redeployment and hiring. During this time, Human Resources will focus on keeping redundancies at a minimum by planning compulsory redundancy for the Data Services Department only. The organisation will continue to carry out a full review of all operating functions as well as all internal service functions, although we do not expect additional redundancies will need be issued.
Plans to minimize redundancy will include reducing overtime, reducing part-timers and temporary staff and encourage work-sharing. (Armstrong and Taylor, 2018)
Human Resources will work with managers and select which staff will be made redundant. Reasonable warning of pending redundancies will be giving in addition to the statutory notice period. The organisation will be offering statutory redundancy, a payment of
· Two weeks’ pay per year of service
· One week’s pay (the bonus week)
The organisation will also offer outplacement consultations to help employees find alternative work and offer counselling for any problems they may be faced with.
Human Resources will look at opportunities to upskill and the redeployment of employees. All employees who are at “risk” will be added to a redeployment list. Redeployment questionnaires will be distributed to employees and returned to Human Resources. Any suitable vacancies will be restricted to employees who are at risk in the first instance.
For redeployment to be successful the job must be suitable; an employee should have the skills and competence required to perform it to the required standard either immediately or within a reasonable period of retraining.
An eligible employee who is successfully redeployed within the organisation will not entitled to redundancy pay.
Other options for the organisations to aid downsizing is early retirement incentive across the organisation to all potential retirees, this will not only reduce the overall headcount but will make room for more junior employees to grow and progress within the organisation and all them gain management experience. Clear communication will be made that the early retirement is an incentive and the terms and conditions will expiry
Human Resources will continue to plan ahead and monitor normal flow of leavers to help reduce head count, hiring freeze will commence will commence across the organisation for all non-essential position. (Armstrong and Taylor, 2018).
Each department, Data Services, Customer Services., Accounts Receivable and Operations will all be looked at separately and assessed based on the needs of the department to successfully function. The hiring freeze will continue until all departments have been successfully restructured. However, the organisation will continue to hire in areas where skills are difficult to find and the new outsourced sales department only.
While the company is restructuring the organisation will be making tough decision on who stays and who goes. Methods of downsizing will be natural attrition, mandatory redundancies, early retirement and layoff’s. This is an excellent opportunity for the organisation to get rid of “dead wood”.
Outplacement programs will be set up to provide counselling and job search assistance to workers who have been made redundant.
Human Resources will also have a big focus on the culture to help avoid low moral, this is where our retention strategy will help. The organisation will have a company meeting with all survives and give clear communication regarding the future of the organisation and the employee’s future
To conclude we recommend a focus on employee retention and perfecting skills of our current employees. The organisation must invest in training and development programs, a cost effective option would be introducing a learning form across the organisation that will allow employees to train one another in particular areas. The organisation will promote education to further employee’s knowledge within the industry. Employees will be offered attractive salaries and benefits with a focus in a work life balance. These activates are expensive to the organisation, however will reduce turnover cost. We want to focus on creating a workforce who are motivated and properly trained that will bring in more returns for the organisation.
Armstrong, M. and Taylor, S. (2018). Armstrong’s Handbook of Human Resource Management Practice. 14th ed. London: Koganpage.o