Navigating ASC 606 Revenue Recognition: A Comprehensive Guide for CFOs
How to Ensure Continuity After Employee Turnover
Losing employees to turnover can rank somewhere between an afternoon spent at the dentist and a brisk walk through the gates of Hades if not handled properly. Not a firm in existence – no the matter the industry – experiences any particular sense of delight when key employees walk out the door to never return.
For accounting departments, this can be especially destructive if those you are losing to attrition take with them specialized skills and knowledge that are difficult to replicate short of some bizarre cloning ritual. Whether it’s a matter of the firm itself relocating or an employee leaving due to illness, relocation, maternity leave, or just simply resigning, maintaining your firm’s bandwidth and output after turnover is absolutely critical for continuity and production.
That said, your compassionate friends here at Embark have a handful of best practices to share with you that, collectively, can help ensure that all-important continuity when losing a key employee or two. No matter how turnover might make you feel, however, just remember that the earth will continue to spin on its axis, the Mavericks still won in 2011, and Embark will always be here to dispense our unsolicited but sage advice.
Always Be Professional
Sometimes an employee leaves with little to no warning. Sometimes they act as if their departure warrants a downtown ticker-tape parade, an open bar, and a key to the city. Whatever form attrition takes in your office, maintaining civility and absolute professionalism – even if it’s not particularly deserved – is of utmost importance to the future of your firm.
In other words, don't lose your composure with an exiting employee over the personal circumstances that have led to leaving the firm. A negative reaction on your part won't benefit anyone involved and can even create a ripple effect within your remaining employee base that could impact their own job satisfaction and productivity. Instead, maintain a relentlessly open mind and use the circumstances as a learning opportunity if at all possible.
Likewise, the level of professionalism you exhibit can have lasting repercussions for both yourself and your company within an often tightly woven accounting community. Burning bridges – with or without cause – is emblematic of bad interactions that can fester like an open wound and spread throughout the local networks you depend on. Obviously, this could have an extremely detrimental effect on your future recruiting opportunities while also tarnishing your firm's reputation within the industry.
Speaking of those learning opportunities, take full advantage of the exit interview with your employee and use the occasion to have a candid conversation where you can specifically ask for feedback on their perspective and any insights they might offer.
Furthermore, the exit interview should be much more than just the typical, formal procedure conducted by HR. Instead, let it provide you the chance to take a deep dive into the situation, letting your employee know upfront that you are not a delicate little flower and whatever they say won't hurt you.
Remind your employee the only way to improve the firm and the employee experience is to have a more thorough understanding of what needs to be improved in the first place. This, of course, requires honest feedback that delves into their likes and dislikes, unhappiness, and level of satisfaction with their employment through your firm.
Throughout the process, try to continually improve your understanding of the employee’s position and, in retrospect, if they were a good fit to begin with. Determine if they were sufficiently challenged by their position and prepared for success. If not, this feedback could be invaluable in helping you make necessary adjustments to mitigate the negative impact of turnover in the future.
Evaluate the Position
Building on the feedback you gathered in the open and frank exit interview with your employee, take the time to reflect on the information to identify what adjustments should be made for both the position to be filled as well as any pervasive issues within the workforce.
Regarding the work at hand, when filling the vacant position, use the exiting employee as a benchmark to determine the ideal level of experience for that position going forward. If your exiting employee either underperformed or weren't a good fit, perhaps there might be intrinsic issues to the position that naturally lends itself better as an opportunity to outsource the role or reduce it to a part-time position..
Although you want to be thorough in your analysis of the situation, remember that brevity also has its rewards. Every moment you spend in pensive research mode is a moment not being spent either hiring someone new or allowing the exiting employee to train their replacement. Quickly and thoroughly evaluate what is best for your company and team going forward and then transform those insights into action as soon as possible.
Take Inventory and Plan Accordingly
From an output perspective, taking a full inventory of everything the exiting employee is working on is obviously critical to maintaining continuity and productivity. If there are any projects that likely won't be completed before their departure, start delegating their work to others to minimize the impact of their departure. This process requires efficient and effective communication so to prevent anything slipping through the cracks.
If delegating work is necessary, take into account the repercussions of the additional workloads placed on your remaining team members. Some might expect a raise if they are required to work additional hours and won't necessarily be able to produce at the same quality level or timeliness of the exiting employee. Depending on the level of difficulty and necessary knowledge base, either a consultant or headhunter might be in order to help streamline the process and keep the firm functioning at an adequate level. If that's the route you choose, be certain to perform a cost-benefit analysis to properly understand any budgetary impact from your decision.
Whatever your preferred cliché might be – turn that frown upside down, something about life giving you an orchard's worth of lemons – employee turnover doesn't have to disrupt your output or office environment if handled appropriately. Use these best practices as a general guide when attrition rears its ugly head, learn from the circumstances, and keep that chin up.