The risk critical to every organisation – Loss of key employee (s)

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“Everyone is replaceable” is a lie, according to Liz Ryan. She believes if we were truly hiring people who could be replaced at any moment, we’d be doing a terrible disservice to our customers and shareholders.

While it may be true that an organisation’s employees are its greatest asset, they can also be one of its greatest risks when not managed well. It is true that not all of the possible reasons for an employee’s resignation are within an organization’s control. Some may include the following:

  • To start a business, or
  • For a better position offered elsewhere, or
  • Move to another town for personal reasons
  • Being dissatisfied in the current job for various reasons which may not be controllable by the employer.

When an employee resigns, the loss is of the future value that the individual would have provided to the organisation. Employees’ replacement could reduce the organisation’s loss risk, but some will remain until the replacement employee reaches the same level of proficiency as the person who departed. Can your organisation analyse the key employees who have resigned due to something that could have been managed by management? Can you imagine how your organisation would have been if all these people were still around bringing to bear their rich experience?

Again, it always costs more when the company wants to immediately replace with someone at the same level of expertise and experience. It will still cost you time and other resources for the new-experience person to adapt to your organisation’s culture.

Resignation of key staff also discourages existing staff. Customers also begin to lose interest when staff on their schedule keep changing because of resignations. It takes away their confidence and trust. Causes of dissatisfaction that may lead to staff resignation might be resolved with a cost-effective or feasible change, such as shifting the employee to a new position or assigning new responsibilities.

Occasional reviews of the workforce’s demographics can illuminate the risks of – in the case of a predominantly young workforce – potential mass-resignations, as employees seek new employment opportunities and career advancement.

Duplication as a risk management control measure can also be used to reduce the impact of key staff resigning. An example of duplication could be cross-training employees so that each has a variety of skills. There’s still risk if all or a majority resign regularly.

It is also very important to assign coaches or mentors to, especially, young ones in the organisation. This will enhance communication and problem-solving. Staff will feel the warmth of management.

Staff should be made aware of their succession-plan and a clear path of development. This will eliminate insecurity and increase their trust in management, which makes it easier for individual staff to align their personal goals with organisational goals.

An organisation should be concerned when the frequency of employee-departures increases. Determining the cause of these departures is essential, because it may indicate problems within the workplace. For example, a worker who is treated poorly by a manager may find the work environment intolerable and resign.

When this occurs, a risk management professional needs to determine whether this is an isolated incident or other workers have similar impressions of the manager. Exit interviews can reveal whether other workers have resigned for similar reasons; the issue may concern just one manager or may be prevalent throughout the division or company. Another risk is when people fail to provide the true reasons why they are resigning at exit interviews.

In all these, it is very important for every orgnisation to have a holistic view of their Enterprise Risks. It is also important to have a Risk manager who will coordinate these risks – which include Hazard risks, Operational Risks, Financial Risks and Strategic risks.

There are basically three things employers must do to keep employees self-motivated:

  • Recognise great work
  • Ensure employee stay fuelled (food is important)
  • Encourage regular breaks (flexible working hours)

The writer is a  Chartered Insurer and an Associate of the Chartered Insurance Institute of United Kingdom and also Ghana (ACII-UK, ACIIG),

+233 (0) 549705031                      [email protected]

Reference

https://www.linkedin.com/pulse/lving Risk, American Institute for Chartered Property and

https://www.bing.com/images/search?

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