The True Cost of Turnover

The True Cost of Turnover

December is a time for holiday celebration and for many people, the time they prepare to change jobs. After holiday bonuses and year-end incentives pay out, we often see candidates ready to jump ship. While most HR departments can look at the cost of backfilling these positions in terms of lost revenue, recruiting expenses and overtime costs, turnover has a huge effect that is often not easily quantifiable.

  • Affected Staff Turnover – When anyone leaves a department, there is always a “ripple”. Morale can take a hit, there is a higher workload to cover, and employees can feel uncertain about the stability of the company & their career progression in it. The idea of “Maybe I should look too” is also subtly transmitted.

 

  • Client Perception – When clients routinely deal with a new face, it can send a direct message of internal turmoil and instability within your company. Having clients interact with multiple people within your company may soften this affect and retain the “personal touch”.

 

  • Tribal Knowledge Lost – Losing a tenured person also means losing the experiences they have had and the situations from which they learned. A standard 2-weeks’ notice is nowhere near enough time to download years of experience, so companies that do not routinely mentor, cross-train and promote succession planning will be blindsided when a key employee gives notice.

 

  • The Lack of Engagement Opportunity Cost – The mental transition of an employee who has decided to leave, even before they accept a new job, can be felt by those around them and can raise the stress level of the entire team. A real or perceived “pull back” of effort can signal for others to do the same, even if not consciously.

 

By using December as a time to celebrate your employees’ accomplishments and strategically plan their next step, you can help proactively retain the people that are crucial to your team’s success!

By Dixie Agostino, HRCI Chair for Tulsa Area Human Resources Association and CEO of Switchgear Search & Recruiting

For more information, answers or a mean cup of tea, contact Dixie Agostino at our contact us page.