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The Top Reason Employees Might Quit Your MSP - and How to Avoid It

When the most productive employees leave, undeniably, it causes concerns within your clients, and demoralizes team members. What’s more, MSP’s incur training and on boarding costs to hire new staff and ensure a smooth transition. The truth is that it takes a lot of effort, resources, and will power for MSP businesses and teams to engage in constant recruitment efforts.

In 2021, known now as the “Great Resignation”, the job market has become so dynamic that it has required a swift reaction from MSP leadership. With this market shift, MSP owners are battling not only to find talent but to retain it. Undoubtedly, employers are having to raise the bar and form a better understanding of their employees needs and aspirations.

With millions of job openings and quit rates increasing, according to Labor Department data, companies looking to hire are desperately searching for options. The question is, are companies looking in the right places?

One recent study of 2,000 employees conducted by the Predictive Index found that nearly half of them have thought about changing careers in the past 12 months. And a staggering 63 percent of those employees with a bad manager are thinking of leaving in the next year.

The single biggest decision you make in your job -- bigger than all the rest -- is who you name manager.
People Leave Managers, not Companies

According to INC.COM: The reason so many people are quitting has everything to do with their relationship with their bosses. A 2018 Udemy study found that nearly half of employees surveyed had quit because of a bad manager, and almost two-thirds believed their manager lacked proper managerial training.

In Gallup's ongoing "State of the American Workplace" study, Gallup CEO Jim Clifton summarized in a succinct sentence the bottom line of why your company's employee turnover may be high:

The single biggest decision you make in your job -- bigger than all the rest -- is who you name manager. When you name the wrong person manager, nothing fixes that bad decision. Not compensation, not benefits -- nothing.

This is the conclusion Gallup drew from decades of data and interviews with 25 million employees. Yet, here we are in the post-pandemic age and organizations continue to think of every reason to retain their workers -- from more pay, more perks, more flexible work options, and more mental health resources, to name a few -- without considering the role and impact that the manager makes on the employee. We've heard this tune before: People leave managers, not companies.

Among the many relationships employees will develop at a company, those formed with one's manager have a significant impact on overall workplace experience, even more so than one's relationships with other peers.

More specifically, it is important that employees feel as though they have a supportive and open communication channel with their managers, to the extent that they would feel comfortable discussing topics such as compensation and their job.

Acknowledgment by management is crucial and should be a priority for companies looking to retain their employees and avoid the high cost and lost time of higher turnover. Those willing to lay their ego aside and grow as leaders -- need to improve in three crucial areas:

1. Communication

Any good leader knows the value of communication. In the hybrid workforce model, the skill of effective communication has skyrocketed in value. According to the Predictive Index report, it's the No. 1 skill employees feel their manager lacks. Additionally, communication is the top skill employees value in their manager, second only to confidence.

2. Psychological safety

Research on psychological safety by Amy C. Edmondson of Harvard Business School indicates that when leaders foster a culture of safety -- where employees are free to speak up, experiment, give feedback, and ask for help -- it leads to better learning and performance outcomes. When psychological safety is absent, fear is present. And fear is detrimental to achieving a team's full potential. We just can't be engaged or innovative when we are afraid.

3. Provide growth opportunities

It's a known fact that employees with a career mindset want to work for managers that will help with their career progression. If managers don't give their employees space to learn, stretch, and grow, and if they don't provide opportunities for promotion, they can't expect their talent to remain at their company.

In closing, no group can create a more immediate and positive impact on employees than front-line managers. To support their teams, managers need to relearn key mindsets and behaviors to lead people in the new world of work. When companies put the focus on equipping managers with leadership skills like relationship building, recognition, empathy, and social connection, the whole organization experiences the ripple effect of increased creativity, greater collaboration, and better performance.

There’s a chance you may need to improve your leadership training and employee development process. With SOPwerks, MSP businesses can improve culture, leadership, and retention simply by documenting their process and holding their team members accountable to the process. You can leverage automated onboarding, centralize processes, and offer personalized portals to clients.


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