Parting Ways

The loss of a key employee can deal a real blow to your company. How you manage that departure makes all the difference.

Source: REPLACEMENT CONTRACTOR Magazine
Publication date: 2005-09-01

| By Becky Mollenkamp |

Steady work and high pay weren't enough to keep two of Quality Siding's best production employees onboard. They quit, citing a better offer. Losing skilled, reliable workers can hit a company hard.

“It's stressful,” says Jonathan Stone, owner of the Spokane, Wash., company. “My business will suffer and I'll lose customers if I don't get the work done on time.” While he searches for new help, Stone is using subcontractors to fill in the gaps.

Manage the Departure

For many company owners, just the thought of losing a key employee is enough to cause heartburn. But contractors who prepare for employee departures will have less to worry about.

“There are enough things to stress about,” says Tom Gegax, founder of Tires Plus and author of By The Seat of Your Pants: The No-Nonsense Business Management Guide (see www.gegax.com). “If you've done everything you can, you shouldn't lose sleep over this.” He offers several suggestions for managing employee departure.

First, don't give up. Valuable employees are worth a fight. If you can match or beat the employee's new offer, do so. If you can't, sit down and discuss the benefits of staying (better working conditions, more vacation time, etc.). Gegax says these brainstorming sessions convinced about half of his bolting employees to stay.

Second, let them go if you have to. “You can't always just hand out money to keep people around,” says Paul Armstrong, a superintendent at Rick Thomas Roofing Corp. in Phoenix. When a key employee's departure is inevitable, be gracious. Thank him for his service and let him know he's welcome to return. Take the time to find out what the departing employee liked or didn't about his job experience. Have someone other than his boss conduct the exit interview. “I learn more from people who are departing and who aren't invested in the code of silence anymore than I do day-today,” Gegax says.

Be Prepared

Of course the best strategy is to be ready for such losses. Develop a succession plan today. Cross-train employees so you can promote from within. Keep a shortlist of outsiders you can approach when an important job opens up that can't be filled internally. “Think ahead,” says Brian Elias, president of Hansons' Home Services in Madison Heights, Mich. “If things are set up so the walls cave in when a person leaves, then that's what happens.”

Elias also suggests owners not get bogged down in negatives. When his company's vice president left to become a competitor, he promoted a sales rep and the company is stronger for it. “It turns out that the person you thought was so irreplaceable is actually replaceable,” Elias says. “You realize that you have other good people who can step up.”