Blackie SherrodBlackie Sherrod died last week. To any reader of sports pages across the nation and most particularly in Texas, Sherrod was about as good as it got. For me, he was right up there with Red Smith, Frank DeFord and Shirley Povich as one of the greatest sports writers of the second half of the 20th Century. His columns on the Dallas Cowboys in the 1960s and 1970s were truly pieces of art to be marveled at when savoring. He also had the good sense to hire Dan Jenkins and Bud Shrake as young sportswriters.

I thought about Sherrod when I read a recent article in the Harvard Business Review (HBR), entitled “Making Exit Interviews Count, authors Everett Spain and Boris Groysberg assert that exit interviews, when conducted with care, can be a very useful tool in two important areas: to increase employee engagement, to reveal what may not be working in the organization.

The authors believe that exit interviews can provide insight into what employees are thinking, reveal problems in the organization, and shed light on the competitive landscape. They believe that companies should focus on six goals in their exit interviews, that there must be an emphasis in both “tactics and techniques” and, finally, that the process is a continuing conversation.

I.      Overall Goals

  1. Uncover issues relating to HR. The authors find organizations “that conduct exit interviews almost always pursue this goal but often focus too narrowly on salary and benefits.” The problem with this approach is that salary concerns are not usually what drives employees to seek employment elsewhere. It is almost always something else. The article stated, “One leader from a food and beverage company told us that exit interviews inform his company’s succession planning and talent management process.”
  1. Understand employees’ perceptions of the work itself. Here the authors require that the person conducting the exit interview understand the departing employee’s job design, working conditions, culture, and peers. By understanding and questioning the employee on this information, the exit interview “can help managers improve employee motivation, efficiency, coordination, and effectiveness.”
  1. Gain insight into managers’ leadership styles and effectiveness. Leadership style is an important reason many employees depart for greener pastures. By inquiring into and understanding this dynamic, an organization can begin to “reinforce positive managers and identify toxic ones. One executive at a major restaurant chain told us that several exit interviews she’d recently conducted revealed that micromanagement was a big problem. The conversations, she said, “led to some very tangible outcomes,”” such as establishing training and development initiatives to create better managers.”
  1. Learn about HR benchmarks (salary, benefits) at competing organizations. While salaries and compensation packages are usually not the driver of departures, they certainly do play a role. You should use the exit interview to do some benchmarking. The authors cited to a HR executive at a global food and beverage who noted, “We use exit interviews to see how competitive we are against other employers: time off, ability to advance, different benefits, and pay packages. And we want to see who is poaching our people.”
  1. Foster innovation by soliciting ideas for improving the organization. The authors believe that exit interviews should go beyond the departing employee’s “immediate experience to cover broader areas, such as company strategy, marketing, operations, systems, competition, and the structure of his or her division.” They cite as one “emerging best practice is to ask every departing employee something along the lines of “Please complete the sentence ‘I don’t know why the company doesn’t just ____.’” This approach may reveal trends which can be incorporated into future innovations.”
  1. Create lifelong advocates for the organization. I found this one perhaps the most innovative, yet in many ways the most basic, which is of course to treat departing employees with dignity, respect and gratitude. Such treatment at departure may well encourage departing employees to recommend their former companies to potential employees, to use and recommend the companies’ products and services, and to create business alliances between their former and new employers. The authors cite to one North American financial services executive for the following, “You want [a departing employee] to leave as an ambassador and customer.”

II.     Tactics and Techniques

The authors believe that leaving such exit interviews simply to the Human Resources (HR) function is too simplistic an approach because “this approach marginalizes the process and suggests that it is an operational duty rather than a strategic opportunity. Human resources may administer the program day to day, but it is imperative that the right line leaders participate in the interviews and that the executive committee oversees the program’s design, execution, and results.”

The authors believe that exit interviews conducted by “Second-line managers (direct supervisors’ managers) typically receive more-honest feedback precisely because they’re one step removed from the employee. Also, these managers are in a position to follow up immediately and effectively. Their participation signals that the company cares about the opinions of departing employees.” Beyond this level, the authors believe that someone other than in the direct line should conduct the additional interview. I would suggest that this would be an appropriate location for the compliance department to become directly involved.

The specifications of who should be interviewed should also be considered. As departing employees can certainly be ambassadors for the organization, high level or senior management should be listed. However, from the compliance perspective, any employee who comes from a high-risk area, sector, market or geography should also be considered.

The authors point to the timing of the interviews as a key to productivity. They have seen interviews during the mid point between the announcement to depart and the actual departure date as a good time. (Of course, this assumes a policy more enlightened than asking an employee to leave immediately in such circumstances.) Yet some companies have waited until after the employee has departed because, as one person interviewed for the article noted, “They normally tell us very honestly why, and often we respond with programs to work on the problems.”

While a face-to-face interview is always deemed the most appropriate, if an employee has departed, this may not be feasible. The authors noted that some companies conduct telephone interviews or even online surveys. Nonetheless whichever method is used should have structure around the questions and questioning because “the strength of standardized interview questions is that the make it easier to spot trends.”

The penultimate issue is how will your company use this information? The authors write that the distribution of the information obtained “should respect the sensitivity of the data and protect interviewees’ candor, particularly about their bosses.” Moreover the “the distribution of data should be timed according to the executive decision cycle.”

Ultimately, always remember this is a continuing conversation that the authors call “retention conversations”. Think about using the exit interview questions and techniques with existing employees to build upon the internal data you might analyze during transaction analysis. These retention conversations, together with exit interviews can be not only a useful tool but also a critical one as well for the compliance function.

 

This publication contains general information only and is based on the experiences and research of the author. The author is not, by means of this publication, rendering business, legal advice, or other professional advice or services. This publication is not a substitute for such legal advice or services, nor should it be used as a basis for any decision or action that may affect your business. Before making any decision or taking any action that may affect your business, you should consult a qualified legal advisor. The author, his affiliates, and related entities shall not be responsible for any loss sustained by any person or entity that relies on this publication. The Author gives his permission to link, post, distribute, or reference this article for any lawful purpose, provided attribution is made to the author. The author can be reached at tfox@tfoxlaw.com.

© Thomas R. Fox, 2016

 

 

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