ARE EXIT INTERVIEWS A GOOD IDEA?
As a business owner you may be familiar with conducting interviews of applicants you are considering for an open position. However, we would like to share that conducting exit interviews is just as important as interviewing a potential new hire. If you have started to read and you are completely lost as to what an exit interview is, that is completely ok! That is why we are here!
An exit interview is an interview you conduct with an employee who voluntary decides to leave your company. Research conducted by Burke, Inc. shows that 91% of fortune 500 companies conduct exit interviews. They are a great tool that helps you to assess the overall experience that the employee had with your company. It also helps you to discover any bottlenecks or identify opportunities for how to improve the experience of future and current employees, which will in turn improve your retention rate.
Firstly, conducting exit interviews will provide you with more insight and opportunities for employee development. Very often we hear about candidates leaving their existing employers, just because of a lack of career growth opportunities, stagnation, and an absence of financial opportunities. According to Glassdoor, employees are about three times more likely to leave for a new employer than to stay and move into a new role at the existing company. A dynamic environment and constant changes are particularly important for millennials. In order to combat this trend, we recommend that you develop a career path roadmap for each employee. Early on in your employment relationship, show your employee how they can have a career rather than just another job with your organization. Map out specific goals that they need to achieve to get to the next level. Acknowledge their wins and continue to support them and dialogue about their growth potential.
During your exit interview, you may discover that the individual is leaving to obtain better compensation and/or benefits. If the employee mentions that they are leaving to receive higher compensation, it should at least be 10% to 20% higher. If they indicate that they are leaving for a lower rate of increase, then it is likely that compensation is not the only reason why they are leaving. It might be that your wages are competitive, but your benefits are not. An exit interview will help to uncover the real reason why they are leaving and will offer you more insight into how you can plan for the future by improving the retention of great employees. Very often poor management is the reason why good employees leave. During an exit interview, you may discover information about management issues within your company. If you find that you are having a lot of turnover within a particular department and during the exit interview employees are stating that they are leaving due to the management style of their supervisor, then it is your responsibility to protect your business by making sure that you hire and train managers that are the best fit for your company.
A quick Google search will reveal many exit interview questions. We recommend using some open ended questions. A great question is, “please complete the sentence. I don't know why the company doesn't just ________.” Another great question is, “was your time here longer, about the same, or shorter than you thought it would be when you first joined the company?” Base other questions on your company's culture and refine them to minimize bias and to probe for uncovered insights. After you ask the question, wait for the response. They may show you some simple ways that you could improve your company, and help you to come up with better practices and procedures to improve retention.
An exit interview also provides you with an opportunity to review all legal issues before the employee leaves the company. During this time, you can discuss their obligations with the company such as noncompete, nondisclosure or non-solicitation agreements, invention or patent policies, maintaining trade secrets, etc. This will help you to reinforce your legal protections.
In addition, exit interviews enhance your corporate brand by leaving a good impression on the exiting employees. In general, departing employees should be treated with respect and gratitude. This process can encourage them to recommend your company to potential employees, to continue to use your company's products or services, or maybe even create some new collaborations in the future. You always want your departing employee to leave on a positive note. You never know how your paths may cross again in the future. Now that you have come close to the end of this blog post you may be eager to begin conducting exit interviews. One question might be, who conducts these interviews? Usually your HR Manager would be the individual to conduct them. If you do not have an HR Manager, it might be a great idea to have a third party such as a consultant perform the exit interview. A good time to schedule it would be on the last day or two, before the employee leaves. It should not last longer than one hour. It is also important to do it in a private setting and one-on-one where the employee will feel comfortable and safe. The person conducting the interview should use a template document to record their notes and the employee’s answers. Finally, the information you receive during exit interview should be used for implementing positive changes within your organization. Managers should be encouraged to put their egos aside and to look at the information with an open mind. It is easy to feel offended when an employee chooses to work for a different company. However, the magic happens when personal feelings are put to the side and the information in the exit interview is used to improve business practices. Based on the findings, examine those areas of your business and determine if changes are warranted. The final goal is to retain valued employees, identify your reasons for turnover, and to create targeted retention. Exit interviews are important when the employee is already leaving the company. But what about stay interviews? How about interviewing your existing employees to make sure they are happy working for you? We look forward to sharing insight on that topic with you in the future! Stay tuned!