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Exit, Stay and On-boarding Interviews in Australia and New ZealandCurrent practices and untapped value

Key Research Findings | August 2010

www.interviewgroup.biz

© 2010 The Interview Group Exit, Stay and On-boarding Interviews in Australia and New Zealand Page 2

Index

Section 01 Exit Interviews

Section 02 On-boarding Interviews

Section 03 Stay Interviews

Section 04 Participant demographics

Introduction

This research is the first comprehensive survey of exit, on-boarding and stay interview practices in Australia and New Zealand. The goal of this project was to understand whether these practices are being used to their full potential and, if not, to identify where the untapped value lies.

In order to do this we asked participants to fill out a detailed survey containing 75 questions on their current practices, response rates, the content and scope of the interviews and to assess the value they were gaining from their efforts.

Responses were received from 374 organisations from a wide variety of sectors and with headcounts ranging from less than 200 to over 10,000. It was conducted from March to June 2010 via an online survey. The research was advertised in the Australian Human Resources Institute magazine and through a broad email campaign to HR contacts throughout Australia and New Zealand.

Summary

This study reveals that exit interviews have become a standard HR practice. Despite being a newer practice, on-boarding interviews are taking off rapidly and are already half as common as exit interviews. True stay interviews are far less common.

Despite the prevalence of these practices (exit interviews being done in nearly all cases) most organisations who participated in the research feel they are not gaining full value from their effort. Response rates, the availability of a reporting tool to access the data, and how regularly reports where distributed to key people were all factors affecting the perceived value of the interviews. While these are important issues, the research shows that even the organisations who believe they are getting good value for their efforts are missing important opportunities. The key untapped value lies within the content and scope of the interviews, the quality controls on data collection and the disclosure policies.

The collection of information on reasons for leaving provides a striking example of where value from the content is being missed. The research shows that only 16% of organisations distinguish between annoyances and true turnover drivers. This means that 84% of organisations do not have a clear understanding of what causes their staff to resign.

Organisations are also missing a great deal of value in the use of exit data. Key opportunities are the greater use of exit reports (both individual and aggregated reports) for analysis and manager development. Exit information is also vastly under-utilised as the primary guide for retention efforts with many organisations relying instead on staff survey data that is far less predictive of quit behaviour.

On-boarding and stay interview practices similarly reveal a great deal of scope for organisations to improve the returns they are receiving for their interviewing efforts.

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© 2010 The Interview Group Exit, Stay and On-boarding Interviews in Australia and New Zealand Page 3

Topics covered for each type of interview

Data Analysis

1. Who is being interviewed?

2. Data collection methods

3. Quality controls

4. Disclosure policies

5. Interview content

6. Response rates

7. How the data is used

8. Perceived value derived from the process

Recommendations

For each section in the Data Analysis, specific and practical recommendations with detailed explanations are provided to help you increase the benefits you get from your on-boarding, stay and exit interviews.

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© 2010 The Interview Group Exit, Stay and On-boarding Interviews in Australia and New Zealand Page 4

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© 2010 The Interview Group Exit, Stay and On-boarding Interviews in Australia and New Zealand Page 5

Response rates

11. There is great variation in exit interview response rates. The average of just 50% results from the fact that more than 1 in 5 organisations achieve a completion rate of less than 20% and only 24% of organisations achieve completion rates above 80%.

22%

< 20% 21-30% 31-40% 41-50% 51-60% 61-70% 71-80% 81-90% 91-100%

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Exit interview response rates (n=319)

12. Response rates are best when a human being conducts the exit interview. The best response rates are achieved when interviews are conducted by an external consultant followed by an HR manager or HR professional. Of the active methods, the line manager as interviewer achieves the worst response rate.

0%

20%

40%

60%

80%

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HR Manager (or equivalent

HR professional)

HR administrator or coordinator

Indirect manager

of departing employee

Departing employees

line manager

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66%

15%

54%

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average response rate response rate less than 40% response rate greater than 70%

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ResponseÊratesÊbyÊwhoÊconductsÊtheÊexitÊinterviewÊ(n=272)

13. While average response rates were similar across disclosure policies, more organisations with permission based disclosure policies achieve response rates above 70%. Fewer organisations that report anonymously or confidentially, achieve response rates above 70%.

Only 24% of organisations achieve completion rates above 80%.

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© 2010 The Interview Group Exit, Stay and On-boarding Interviews in Australia and New Zealand Page 6

About The Interview Group

The Interview Group’s core business is gathering feedback through high quality over-the-phone interviews. We make this feedback readily accessible to clients through our purpose-built online reporting tool that allows sophisticated segmentation of your employee population. Our average completion rate is over 80% with many of our clients achieving response rates greater than 90%. While our head office is in Australia we serve all locations around the world and have the capability to conduct interviews in multiple languages7. Our service is very easy to set up and use from anywhere.

Our core business:

exit interviews

onboarding interviews8

stay interviews (with staff at your ‘risk points’ in tenure or with high potential/ high performing staff)

The Interview Group’s directors have a wealth of experience in business, human resources and quantitative analysis.

Lenorë Lambert

Registered Organisational Psychologist

16 years in the HR profession including research (Uni of Queensland) consulting (Cullen Egan Dell [now Mercer] and HRM Consulting [now InfoHRM) corporate HR roles (Mallesons Stephen Jaques and Hamilton James & Bruce) and leadership development facilitator (Platinum Leaders).

Prior to founding The Interview Group Lenorë founded Platinum Leaders specialising in intensive leadership development programs. Her last corporate role was Director of HR & Learning at the publicly listed recruitment firm Hamilton James & Bruce.

Matthew Ma

Electrical Engineer, Mathematician, University Medallist (mathematics), MBA.

16 year career including management consulting (McKinsey & Co.), investment banking (Westpac and Macquarie Bank) and operational roles in the energy sector (Schlumberger).

Prior to founding The Interview Group Matthew was a Senior Manager in the Investment Banking Group at Macquarie Bank.

Phone +612 8821 7400Email enquiries@interviewgroup.bizWeb www.interviewgroup.bizMail PO Box 322, Dee Why, NSW, 2099, Australia

7 Depending on the number of interviews required and the languages required.8 These are sometimes referred to as ‘commencement’ interviews.