The impact of high employee turnover on company morale and productivity

By Kathy Zant

team members laughing and enjoying their work day together.

Great leaders often work diligently to foster team cohesion. From managing conflict to effective team-building strategies, building the perfect team is an art form. 

I’m sure you’ve seen it. Subtle moves, motivationally aware projects, and brilliant pairings of teams can make magic happen.

And yet, even with brilliant leadership, sometimes turnover happens due to circumstances beyond a leader’s control.

It can be shocking when a high-performing and valued team member leaves. The shock doesn’t only affect leadership. The ripple effects of an abrupt departure can be felt throughout an organization. The loss of a team member impacts operational efficiency and can significantly affect team morale and motivation across different personality types and motivational drivers. 

The closer a team member is to a departing high performer, the greater the impact on those left behind. 

Turnover affects morale

  • Decreased team cohesion. Frequent departures can disrupt team dynamics and lead to a lack of cohesion. New employees take time to integrate; during this period, existing team members may feel uncertainty due to the absence of familiar colleagues.
  • Increased stress and anxiety. The remaining employees might experience increased workloads, leading to stress. There’s also a fear among staff of being next in line for layoffs or resignations, which can create a tense atmosphere.
  • Loss of institutional knowledge. With high turnover, especially among long-term employees, there’s a loss of experience and knowledge, which can be demoralizing for those who remain, feeling they must constantly train new hires or lose valuable insights.
  • Reduced employee engagement. Seeing colleagues leave can lead to questioning job satisfaction and company loyalty among the remaining staff, thereby reducing engagement and commitment to company goals.
  • Cynicism and resignation. If turnover is perceived as a sign of poor management or lack of growth opportunities, it can foster cynicism or a resigned attitude among employees, further eroding morale.

Turnover affects productivity 

  • Training costs. Every time an employee leaves, there’s a cost associated with recruiting, hiring, and training a replacement. This process can be time-consuming and detracts from productivity as other employees may need to cover duties or assist in training.
  • Efficiency losses. New hires generally take time to reach the productivity level of their predecessors. During this learning curve, there might be a noticeable dip in output or an increase in errors.
  • Workflow disruptions. High turnover disrupts established workflows and project timelines, potentially leading to delays. Teams might need to reorganize or redistribute tasks, which can temporarily decrease efficiency.
  • Production quality impacts. With frequent changes in staff, maintaining consistent quality in products or services can be challenging. There’s a risk that institutional memory regarding quality standards or best practices might not be transferred effectively.
  • Stagnated innovation. High turnover might discourage innovation since new ideas often come from stable teams where trust and long-term collaboration are fostered. Constant change can hinder the development of new projects or improvements.
  • Customer Impact. In roles that involve customer interaction, high turnover can lead to dissatisfaction among clients or customers who prefer dealing with familiar faces. This can indirectly affect productivity through lost business or the need for service recovery efforts.

Turnover can have an emotional impact

High turnover creates uncertainty and instability that can shake even the most resilient teams. The departure of key performers often leaves remaining team members questioning their own future with the company while shouldering additional workload. This emotional burden manifests differently across Motivational Dimensions.

Turnover affects everyone differently

Managing people through periods of turnover or transition requires focused attention from leaders. Some examples include: 

Achievers

Achievers may feel their personal excellence is diminished when high performers leave, questioning the company’s ability to retain top talent. Leaders should approach Achievers to:

  • Highlight new opportunities for personal growth and advancement
  • Create clear paths for achievement in the transition period
  • Recognize their increased contributions during the transition

Orchestrators

Orchestrators often struggle with disruption to carefully crafted systems and team dynamics. Leaders should: 

  • Involve them in restructuring plans
  • Provide clear transition timelines
  • Allow them to help design new workflows

Relators

Relators are often hit hardest by team changes, as they value strong relationships and team harmony. Leaders must: 

  • Acknowledge the emotional impact
  • Facilitate proper goodbyes
  • Create team-building opportunities with remaining members

Drivers

Drivers can continue through any challenge, but that doesn’t mean leaders can assume all is okay. Encourage them to focus on maintaining momentum despite changes, as well as:

  • Set clear goals for the transition period
  • Provide resources to maintain productivity
  • Create action plans for immediate challenges

Guiding teams through change

Leaders must guide their people through change. Employees perform best in environments of cohesion, trust, and collaboration. When a high performer leaves, leaders must coalesce teams around the organization’s mission and values. They should focus on:

Transparent communication

  • Share information openly about transitions
  • Provide regular updates on hiring plans
  • Address concerns promptly

Workload management

  • Redistribute tasks fairly
  • Bring in temporary support when needed
  • Prioritize critical projects

Recognition and support

  • Acknowledge additional efforts
  • Provide emotional support
  • Maintain regular check-ins

Growth opportunities

  • Identify internal advancement possibilities
  • Offer skill development programs
  • Create mentorship opportunities

Motivation can help leaders provide targeted support

While turnover can be challenging, understanding how different Motivational Dimensions react allows leaders to provide targeted support and maintain team stability. By acknowledging these different perspectives and needs, organizations can better navigate transitions while maintaining productivity and morale.

Remember that periods of change, while difficult, can also present opportunities for team growth, reorganization, and the emergence of new leaders. The key is recognizing individual motivational needs and providing appropriate support and opportunities aligned with each team member’s core drivers.

By taking a dimension-specific approach to managing turnover, leaders can better maintain team cohesion and productivity while potentially turning a challenging situation into an opportunity for growth and development. 

Written by Kathy Zant

Kathy Zant is a content creator focused on helping people find empowerment through greater self awareness. As a Visionary, she is a twenty-year veteran of the tech industry in both highly technical and marketing roles. Kathy is happiest helping people see what's possible.

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