Before the COVID-19 pandemic, hospitals and health systems struggled to manage inpatient excess capacity while additional procedures were shifting to an outpatient setting. Today, hospitals are faced with even greater struggles as they address daily challenges of finding available capacity for a burgeoning patient population with an increased demand for inpatient healthcare services, combined with an uptick in employee turnover. If a hospital did not have a disciplined management system and an employee retention strategy before the pandemic, the new demands on our healthcare systems are likely exploiting these struggles.
If we assume the average cost of turnover of one hospital employee is equal to $70,000 (1 x average annual salary and wages), the cost of each percentage point of turnover for a hospital with 1,500 employees with a 17% annual rate of turnover is worth more than $1 million. Turnover equals hard dollar costs.
Below are four key elements that are essential to managing employee retention:
1. Planning
- Anticipate fluctuations in volume and capacity.
- Establish staffing strategies and plans.
Employees don’t like surprises, so planning for changing volume is critical to workforce management. Despite the volatility of these unprecedented times, hospital volume can be reasonably anticipated, yet some managers are still surprised. Most events that drive patient volume and management systems can be anticipated and should be built into projected staffing plans. Hospital volumes change rapidly, and many last-minute staffing changes can be avoided. The best management systems can recognize these patterns and quickly respond to the necessary changes needed.
2. Scheduling
- Optimize scheduling practices.
- Expand technology solutions.
An attractive feature of any clinical job is a predictable and reoccurring schedule. Giving employees a voice in the scheduling process is an essential tactic for keeping employees engaged. There are technologies that can be leveraged for employees to have a voice in planning their own schedule. Engaging employees and giving them more control over their own schedule can be a competitive advantage in retaining employees.
3. Follow-up
- Continuously address staff scheduling.
- Balance patient and employee demand.
Periodic follow-up to make sure staffing plans deliver the intended result is an essential, yet often forgotten, step in improving the scheduling process. Effective scheduling systems not only measure the outcomes, but those systems can tell a manager how to adjust to improve results. Balancing patient demand with effective staff schedules is a continuous process. Avoiding last-minute schedule changes and giving employees a voice in their schedule play critical roles in improving employee retention.
4. Employee Engagement
- Focus on manager leadership.
- Make employees part of your family.
Many front-line managers often rate difficult conversations, coaching and engaging their teams as their top challenges. Leadership competencies and skills should be an essential component in the recruitment process for front-line leaders. Furthermore, equal emphasis should be placed on leadership skills and technical skills when it comes to internal promotions. Coaching on performance and development of staff should be balanced with recognition for contributions and achievements. Front-line leadership skills should be developed and honed to recognize employee performance and personal milestones to make employees feel valued. Just when it seems there is no available time for celebrations, carve out time to recognize your most dedicated employees. The right manager in critical front-line positions is the most impactful way to nurture a positive work environment for the organization.
Management systems are critical in making sure a hospital has the right resources in the right place at the right time. Without an employee retention strategy that closely addresses employee needs and a lack of forecast changes in volume, filling excessive vacancies can quickly become an expensive proposition. Anticipating volume changes, minimizing scheduling surprises, following up to make sure that employees scheduling needs are met, and consistently recognizing employees on a personal and professional level will yield hard dollar savings.
Stephen Lothrop is managing director of BRG.