Chapter : 12_8

Managing Workforce Flow

 Learning Objectives
After studying this chapter you should be able to:
• Discuss ways to make socialization more effective.
• Describe the six different types of turnover.
• Discuss employee retention strategies.
• Discuss various ways of downsizing a company’s
workforce.
• Describe how to effectively terminate an employee.

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 Chapter Outline
• ORIENTING AND SOCIALIZING NEW EMPLOYEES
- ORIENTATION
- SOCIALIZATION
- THE PHASES OF SOCIALIZATION
- SOCIALIZATION CHOICES
• Managing the Flow of the Workforce
- Turnover
- Types of Turnover
- The Causes of Voluntary Turnover
- Developing Retention Strategies
- Downsizing
- Discharging Employees
 ORIENTING AND SOCIALIZING NEW
EMPLOYEES
• Many organizations invest more money in hiring
new employees than in helping them acclimate and
become productive.
• Most new hires want to get off to a good start, but
need help doing so.
• It takes mid-level managers an average of six
months to get up to speed in a new job.
• Even in restaurants and hotels it can take about 90
days for a new employee to attain the productivity
level of an existing employee.
• On average, the time for new external hires to
achieve full productivity was eight weeks for clerical
jobs, 20 weeks for professionals, and more than 26
weeks for executives.
 Orientation
• Orientation is the process of completing new hires'
employment-related paperwork, providing them
with keys, identification cards, workspaces, and
technology such as computers, company e-mail
addresses, and telephone numbers.
• It also includes introducing the new hires to their
coworkers and familiarizing them with their jobs
and with the company's work policies and benefits.
• Orienting new employees can speed up the time it
takes them to reach the breakeven point at which
they stop costing the firm money and start
generating a return on the company's investment in
them. E.g., Starbucks
 Socialization
• Socialization is a long-term process of planned and
unplanned, formal and informal activities and
experiences through which an individual acquires
the attitudes, behaviors, and knowledge needed to
successfully participate as a member of an
organization and learns the firm's culture.
• Socialization helps new employees understand the
values, processes, and traditions of the company
and prepares them to fit into the organization and
establish productive work relationships.
 Socialization
• Can speed up the time it takes new hires to reach
the point at which they start generating a return on
the company’s investment in them.
• Can improve employee retention and employee
engagement, lessen the impact of reality shock, and
facilitate new hire adjustment and integration.
• People who are well socialized in their
organizational roles tend to have higher incomes,
be more satisfied, more involved with their careers
and more adaptable, and have a better sense of
personal identity than those who are less well
socialized.

12-7
 The Phases of Socialization
The socialization process typically includes three
phases:
1.Anticipatory socialization.
• Interacting with the company's representatives
before entering the company can develop new
hires‘ expectations about the company and the job.
• Ensuring that all employees who interact with
recruits reinforce the company's culture and
expectations of employees can enhance the
effectiveness of the anticipatory stage.
 The Phases of Socialization
2. Encounter :
• When starting a new job, employees receive
training and begin learning about the company's
culture and norms, and how to do the job.
• A higher quality work relationship is created when
managers help new employees understand their
roles and duties and understand the stresses and
issues they are likely to experience.
 The Phases of Socialization
3. Settling in:
• When they begin feeling comfortable with their
jobs and work relationships, new hires become
interested in the company's evaluation of their
performance and possibly about potential career
opportunities within the company.
 Socialization Choices
• Different types of new employees need different
socialization experiences.
• A college recruit with limited or no work experience
needs a different and more extensive socialization
process than a more experienced new hire or an
employee receiving a promotion or transfer.
• There are many different ways to socialize new
employees.
• Table 12-1 summarizes these choices, which we
discuss in more detail next.
Socialization Choices
Table 12- 1

12-12
 One-Time Versus Staggered Programs
• Some companies use a stepped approach to
socialization.
• Holding brief meetings the first day and then over
the next few weeks can help prevent "information
overload."
• Some companies use a one-time meeting.
• It can be cheaper
• One-time meetings in different departments of the
organization helps new hires get a more complete
understanding of company.
 Individual Versus Collective Socialization Programs
• Individual socialization involves socializing
newcomers individually.
• An apprenticeship is a good example.
• With collective socialization, new hires are
socialized collectively and go through a common set
of experiences as a group.
• Collective socialization is best when many people
have been hired to fill a particular type of job.
• This can occur, for example, when the firm is
expanding and hiring many people.
 Formal Versus Informal Socialization Programs
• Formal socialization is a structured socialization
process conducted outside of the work setting using
specifically designed activities and materials.
• Informal socialization is an unstructured
socialization process conducted on-the-job by a
new hire's coworkers.
• Formal socialization increases new hires' job
satisfaction and reduces turnover.
 Sequential Versus Random Programs
• Sequential socialization is a socialization process
that follows a specific sequence of steps.
• Random socialization occurs when the socialization
steps are ambiguous or changing.
• Becoming a doctor is often sequential, whereas
becoming a manger is often random.
• In random socialization, what newcomers learn may
be the things in which they are most interested.
 Fixed Versus Variable Programs
• Fixed and variable socialization address the
temporal nature of the events.
• Fixed socialization processes inform new hires in
advance when their probationary status will end.
• In Variable socialization, employees receive few
clues as to when to expect their probationary
periods to end.
• Moreover, the timeline isn't necessarily consistent
across employees, which decreases the ability of
cohorts to remain cohesive over time
 Tournament Versus Contest Programs
• With tournament socialization, each stage of
Socialization is an "elimination tournament," and a
new hire is out of the organization if he or she fails.
• Many law firms use tournament socialization.
• With contest socialization, each socialization stage
is a "contest," and each new hire earns a track
record and "batting average" over time.
• A person's failure is generally considered a learning
experience and not grounds for punishment or
termination.
 Serial Versus Disjunctive Programs
• Serial socialization is a socialization process
whereby supportive organizational members serve
as role models and mentors for new hires.
• Newcomers are generally expected to follow in
their mentors' footsteps.
• With disjunctive socialization, newcomers are left
alone to develop their own interpretations of the
organization and situations they observe.
• Under a disjunctive socialization process,
newcomers develop their roles in isolation.
 Investiture Versus Divestiture Programs
• Investiture socialization reaffirms newcomers' self-
confidence and reflects the fact that the
organization's senior members value the knowledge
and personal characteristics of the newcomers.
• Divestiture socialization is an attempt to strip away
people's personal characteristics by requiring
newcomers to "pay their dues" before they can
become full organizational members.
 Socialization Choices
• In addition to the basic types of socialization programs a
firm has to choose from the following:
• What to include: What people, politics, culture, language,
job requirements, and work processes should be
discussed? Which elements of the company's history,
business goals, and key strategic objectives should be
included?
• Whom to include: Which people should be involved in the
socialization program—the newcomer's hiring manager,
coworkers essential to the new
hire's job success, or perhaps the new hire's family?
• How to use technology: Should the socialization program
be Web-based or should new hires attend in-person?
 Managing the Flow of the Workforce
• Managing the flow of talent through the
organization is an essential part of strategic staffing.
• Socialization is only the first phase of workflow
management.
• Once new hires are socialized, their performance
must be managed, top performers need to be
retained and succession planning must be done.
• So, we discuss turnover, retention in more detail.

12-22
 Turnover
• Optimal turnover is the turnover level that
produces the highest long-term levels of
productivity and business improvement.
• Achieving optimal turnover means understanding
both the financial gains and costs of different types
of turnover as well as controlling who stays and
who goes.
• There are six primary types of turnover.
• Table 12-2 summarizes the types of turnover.
Types of Turnover

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 Types of Turnover
1. Voluntary turnover:
• when the separation is due to the employee choosing to
leave the organization for personal or professional reasons.
• The methods of voluntary turnover include a written or
verbal resignation, not reporting for work as assigned,
failing to return from an approved leave of absence at the
end of the leave, or retirement.
2. Involuntary turnover:
• when the separation is due to the organization asking the
employee to leave due to factors such as the employee's
poor performance, disability, or death, or the firm's
restructuring, downsizing, merger, or acquisition.
 Types of Turnover
3. Functional turnover:
• the departure of poor performers.
4. Dysfunctional turnover:
• the departure of effective performers the company
would have liked to retain.
5. Avoidable turnover:
• turnover that an employer could have prevented by
addressing its root cause.
• Low pay, employee dissatisfaction, and poor work
and life balance issues can all cause avoidable
turnover.
 Types of Turnover
6. Unavoidable turnover:
• turnover that could not have been prevented by the
employer.
• This turnover can result from
- resignations due to an employee becoming a
parent
- experiencing a serious illness or death
- a spouse accepting another job requiring that the
family relocate.
Organizations generally try to minimize turnover that
is voluntary, dysfunctional, and avoidable.
 The Causes of Voluntary Turnover
• People choose to leave organizations for many
reasons, including how desirable they believe
leaving will be and the ease with which they can
depart.
• Unmet expectations about the job and organization
also lead to dissatisfaction, which, in turn, leads to
turnover.
• If an employee's job duties are poorly defined, or
the person is given unrealistic performance goals,
this can also result in voluntary turnover.
 The Causes of Voluntary Turnover
• people also leave jobs due to low pay and benefits,
a lack of recognition, not having their voice heard,
or perceived unfairness.
• the best performers may also be more likely to
leave because they have better opportunities
• Although top employees reported pay as one of the
three primary reasons they leave an employer,
employers believed that promotional opportunities
and career development were the primary reasons
• Table 12-3 summarizes the results of the survey and
offers some insight as to how employers and
employees think differently about the situation.
 Why Top Performers Leave
Table 12-3
  Top-Performing Employers’
  Employees’ Responses Responses

Pay 71% 45%

 

Promotion opportunity 33% 68%

 

Work/life balance 26% 25%

 

Stress 24% 8%
 

Career development 23% 66%

 

Health care benefits 22% 0%

 

Length of commute 18% 4%

 

Nature of work 18% 8%

 

Retirement benefits 17% 2%

 

Company culture 13% 10%

 

Relationship with supervisor/manager 8% 31% 12-30

 
 Developing Retention Strategies
• improving employee retention will often make the
firm more attractive to new applicants
• Also, if the retention of good performers increases,
fewer new people need to be hired.
• Developing a retention plan that addresses the
causes of turnover can improve the retention of
critical employees and employees in key positions.
• In Table 12-4, we summarize some common
retention strategies.
 Retention Strategies
Table 12-4

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 Involuntary employee separations
• Involuntary employee separations are
inevitable.
• The most common reasons for involuntary
employee separations are -
- Downsizing
- Terminations
• We discuss each next
 Downsizing
• Downsizing is the process of permanently reducing
the number of a firm's employees so as to improve
the efficiency or effectiveness of the firm.
• Downsizing is a popular way for organizations to
improve their flexibility by reducing their
bureaucratic structures, giving employees the
power to make decisions more quickly, and
improving communication within the firm
• A downsizing can also be done in response to a
merger or acquisition, technological and industrial
changes, a restructuring, and inaccurate labor-
demand forecasting.
 Types of Downsizing
• If the choice of which employees to downsize
is not constrained by a collective bargaining
agreement, there are several ways to choose
who to target in a downsizing.
• Table 12-5 summarizes these downsizing
targeting methods.
 Types of Downsizing
• Across the board downsizing requires all of a
company's units to reduce their headcount by the
same percentage.
• Geographic downsizing targets specific locations for
employee reductions, perhaps due to the loss of an
important customer.
• Business-based downsizing targets only certain
segments of a business.
• Downsizing can target specific functions or
departments that need to be reduced, or specific
positions or jobs that are overstaffed.
 Types of Downsizing
• Performance-based downsizing targets poor
performers.
• When downsizing is seniority-based, the last people
hired are the first people let go.
• If cost cutting is a goal of the downsizing, salary-
based downsizing can help a firm reach this goal.
• Competency-based downsizing involves retaining
employees with the competencies the company
expects to need in the future and downsizing
employees who lack them.
• Downsizing can also be done through self-selection,
if a firm offers its employees inducements to leave,
 Downsizing Activities
A downsizing benchmarking study identified seven
typical downsizing activities, each of which must be
planned for:
1. Conducting a workforce demographics review
including an assessment of the age, diversity, and
skills of the workforce as well as a projection of the
number of employees expected to resign, be
terminated, or retire;
2. Assessing the firm's alternatives to downsizing,
including implementing a hiring freeze and offering
employees buyouts, early retirement, retraining,
and relocation packages;
 Downsizing Activities
3. Outlining the number of employees slated to be
downsized per month, year, location, business unit,
department, and occupation;
4. Conducting the downsizing or reduction in force;
5. Providing career transition/job placement
assistance to separated employees;
6. Providing assistance for the firm's remaining
employees; and
7. Ensuring that an adequate retraining program is in
place.
 Discharging Employees
• Rather than separating multiple people from the
company, as happens with downsizing or layoffs,
discharging focuses on the termination of individual
employees.
• Although this is not a favorite part of the job for
most managers, discharging employees for reasons
ranging from poor performance to misconduct is an
essential part of managing.
• Discharges can happen immediately after a policy
violation or other job misconduct—for example, a
safety violation, the failure of an employee to
renew a professional license, and so forth.
 Discharging Employees
• Most organizations use some form of progressive
discipline for poor performers to give them a
chance to improve.
• The typical progression of steps in progressive
discipline is as follows:
- A verbal warning
- A written warning
- Suspension
- Discharge
• As is the case with downsizing, discharge decisions
should be well thought out rather than made
emotionally