What are the different uses of retention ratio?
Human resources management is the process of controlling and maintaining employees in society, among other things. The retention ratio is a statistical measurement of how many employees leave the company over a specific period of time. Different use of this ratio may be assessment why employees leave, scale for comparison with industry standard and the ability to determine how to better maintain employees. In most cases, companies can calculate their retention ratio at any time if they have the necessary information. Human resources director or other personnel manager usually is in charge of this task. The company simply has to divide the number of employees who have left the average number of employees working in the same period of time. The result of this formula is multiplied by 100 to calculate the actual percentage. The use of monthly numbers is best because this information is most read. Companies can then use this number to assess their storage rate for any necessary purposes.
The ratio of the company's storage can help her assess why so many employees are leaving. In many cases, employees can go through the department process. A short questionnaire may ask employees what the driving force for leaving is. Together with the retention ratio, managers can compare the answers to see which problems or problems were the most important for leaving society. Companies can then try to change negative factors that take employees.
As well as all other business data, the company's storage ratio can help compare its operations against industrial standard. For example, the manufacturing company will experience employees 5 % in the last six months. Although it may be bad internally, the company may not really know if it is bad for industry. Comparding its employee turnover levels to industrial standard helps the company to understand how bad its problems with the preserve areby causing. The company can also compare its current ratio with the previous period to assess a potentially growing turnover.
Employee turnover is often expensive for the company. The company can use its retention ratio to find ways to keep employees. For example, if a growing turnover points to dissatisfaction with a new policy, society can look at its change. The same applies to any other problem, from low wages to long hours or shifts at specific jobs. Therefore, the retention ratio is a working formula for employee management.