Why Employees Leave: The Critical Role of Managers in Retaining Talent

Every company typically encounters the common issue of high employee turnover. Employees leave for better pay, improved roles, or simply because of dissatisfaction with their manager. This article provides insight into this problem.

Earlier this year, Mohan, an old friend and a senior software designer, received an offer from a prestigious international firm to develop specialized software for their India operations. He was thrilled, especially because he admired the company’s CEO, a charismatic leader often quoted in the business press for his visionary outlook.

The salary was excellent, and the company had robust systems, employee-friendly HR policies, a new office, top-notch technology, and even a canteen with superb food. Mohan was sent abroad for training twice. “My learning curve is the sharpest it’s ever been,” he said shortly after joining. “It’s exhilarating to work with such cutting-edge technology.” However, less than eight months later, Mohan resigned.

He had no other job offer but said he couldn’t take it anymore. Several others in his department had also quit recently. The CEO was distressed about the high turnover, the money spent on training, and his inability to understand what went wrong.

Why did this talented employee leave despite a high salary? Mohan quit for the same reason many talented employees do. According to a large study by the Gallup Organization, which surveyed over a million employees and 80,000 managers, the primary reason for employee retention and turnover is their immediate supervisor. This finding is detailed in the book “First, Break All the Rules” by Marcus Buckingham and Curt Coffman.

The study found that if you’re losing good employees, look to their immediate supervisor. Managers are the main reason employees stay and thrive or leave, taking their knowledge, experience, and contacts with them, often to competitors.

“People leave managers, not companies,” write Buckingham and Coffman. Despite significant investments in better pay, perks, and training to retain employees, turnover is primarily a managerial issue. If your organization has a turnover problem, examine your managers first. Are they driving people away?

Beyond a certain point, an employee’s primary need is less about money and more about how they are treated and valued, which largely depends on their immediate manager. Unfortunately, bad bosses are common. A Fortune magazine survey found that nearly 75% of employees have suffered under difficult superiors. Changing jobs often just means encountering another challenging boss.

A bad boss is one of the worst workplace stressors, directly impacting employees’ emotional health and productivity. Public humiliation is particularly intolerable. The first time it happens, an employee may not leave, but the seed is planted. The second time, the thought strengthens. By the third instance, the employee starts looking for another job. Unable to express their anger openly, employees might resort to passive aggression, slowing down their work, only doing the bare minimum, or withholding crucial information.

As Dev says, “If you work for a jerk, you basically want to get him into trouble. You don’t put your heart and soul into the job.” Different managers stress employees in various ways—by being too controlling, suspicious, pushy, or critical. They forget that employees are not fixed assets; they are free agents. Prolonged poor treatment leads employees to quit, often over seemingly minor issues.

It’s not the 100th blow that knocks a good person down, but the 99 before it. While people leave jobs for various reasons, many who leave would have stayed if not for a manager’s poor treatment. Mohan’s boss constantly reminded him, “You are dispensable. I can find dozens like you.” While it may seem there are plenty of replacements, consider the cost of losing a talented employee.

The costs include finding and training a replacement, the interim period without someone in the role, the loss of clients and industry contacts, the morale of coworkers, and potential trade secrets leaving with the employee. Additionally, the company’s reputation can suffer, as former employees become ambassadors, either positively or negatively.

Jack Welch of GE once said, “Any company trying to compete must figure out a way to engage the mind of every employee.” Much of a company’s value lies “between the ears of its employees.” If it’s losing talent, it’s losing value.

Unfortunately, many senior executives, busy with global travels, new deals, and developing company vision, may be unaware of what’s happening internally. One poor manager can drive away the best talent, despite the company doing everything else right.