The True Cost of Losing an Employee.
Our 10 Top Tips to ensure you don't!
There is a recurring, perplexing theme that I see in many businesses. And, each time I see another example, I’m utterly bewildered by the lack of progressive thinking. The subject in question is employee retention, and the lack of attention and value, attached to what is your most valued commodity, the people within it.
Historically, employees are faced with making difficult decisions when leaving employment. Often ‘jumping ship’ is a symptom of the companies perceived employee worth, and their proper value is undermined. The costs associated with losing an employee, exceed not only the economic but cultural ramifications for your company too.
In order for businesses to thrive, a heady mix of ingredients is required. A cocktail of talented individuals, opportunities for growth, valued relationships both with internal and external stakeholders, professional leadership, personal development, demonstrated economic value (salary), individual and collective reward (culture).
And businesses, like any group, workplace or community, should actively demonstrate and achieve a feeling of belonging and understanding, coupled with open and transparent processes and communication.
So, why is it, that the business relationships and needs and values of individual employees are treated so recklessly and with so little regard for the future?
Here are some facts about employee turnover.
The impact on your company culture:
- Company Morale - employees question the reasoning behind an employee's departure. There is a potential loss of staff engagement, feelings of inadequacy, the team feels let down, may not feel the can accomplish or achieve as much without said team member.
- Additional work is put on to existing employees - high expectation, less remuneration = employee discontent
- Client ‘relationships’ are compromised and a grieving process takes place. In extreme cases, the client moves with the employee
- Loss of productivity, there is no I in TEAM.
- A reduction in the quality of work produced
The financial and economic costs
- Advertising Costs
- HR costs
- Recruitment Agency - briefing and fees
- Time for senior management or hiring managers
- Hiring and Screening costs
- Behavioral and/or skill and psych tests.
- Onboarding
- Ongoing Training
- Temporary staff hires
- Moving and hiring costs
- Time spent placating or reassuring clients.
Let’s look at some stats.
• For entry-level employees, it costs between 30-50 percent of their annual salary to replace them.
• For mid-level employees, it costs upwards of 150 percent of their annual salary to replace them.
• For high-level or highly specialised employees, you’re looking at 400 percent of their annual salary.
Hopefully, we now have your undivided attention. Your employees are your companies biggest asset.
Here are Maslow's Top 10 tips for retaining valuable talent.
- Have strong core company values
- Create personalised benefits to individual employees (everyone has different needs)
- Recognise talent and reward loyalty and exceptional work practices
- Promote from within
- Actively encourage innovation and open discussion
- Deeper and more regular levels of communication
- Perform regular HR check-ins
- Help individuals to create a plan to achieve professional development
- Adjust and adapt to individuals changing personal circumstances
- Prioritise healthy workplace processes
At Maslow, our company values promise to help the talent that we place to have a positive career trajectory. Our HR services ensure your businesses keep on track with your business and culture practices, ensuring that you thrive.