Bob's Gutsy Leadership Blog

Bad Attrition Vs. Good Attrition

When I was at Microsoft, we had a very clever way to gain some further insight into the people development skills of managers.

Attrition, defined as people leaving the company, is generally viewed as a bad thing.  But wait a minute.  In just about any organization of some size, there are some poor performers, just like there are some super stars.  When a superstar leaves the company, it is tragic.  The chain of command of that superstar should be held accountable for that unfortunate loss.  In fact, that is bad attrition.

On the other hand, when a chronic poor performer leaves, frankly that is good news.  Sometimes that exit is voluntary, and sometimes it is involuntary; you ask them to leave.   In either case, it is good news.  It is good attrition.

If you take any organization, you want your superstars to stay and you want to be constantly weeding out chronic poor performers.  Since a small percent of your employees are typically chronic weak performers, you want a small amount of good attrition all the time.

Here is what we did at Microsoft and I highly recommend this kind of approach:

1.) For each manager with over 50 employees reporting to them, each year calculate the good attrition and bad attrition.

2.) If the bad attrition is not zero percent, carefully go over with that manager the superstars that were lost and why.

3.) The good attrition should be low single digits, but certainly not below one percent.  If it is, poor performance is probably not being dealt with aggressively enough.

Talent management is critically important, and good and bad attrition data is simply another tool that can be very useful.

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