When our staff are the biggest asset of the business, why do we let so many come and go, and what is the true cost?
If we invested in the latest piece of technology, would we throw it out after a few weeks or months? Or worse, allow our competitors to just walk in and take it?
So then, why do we allow our biggest assets to walk out the door, and what real impact does that have on our bottom line?
1. Cost of Hiring and Firing
The hiring process is costly. It costs about 38% of an employee’s annual earnings to replace him or her, including training and recruitment, as well as the costs of the separation process and losses in productivity because of the disruption in workflow. A revolving door employer doesn’t only lose a single staff member’s productivity; the entire organisation suffers.
Someone has to pick up the slack when an employee leaves. Employees who are doing their own jobs as well as covering for unfilled positions, have increased levels of stress, affecting their level of productivity and quality of work.
3. Knowledge Gap
Chances are the employee filling in for the vacant job, doesn’t know everything about the requirements of the job, as they’ve been too busy doing their own. This can slow down productivity, or unhinge it entirely, as they won’t be doing their own job to the best of their ability, or the one they’ve had to pick up.
When stretched too thin, by having to cover vacant posts, the chances of burnout increases exponentially. The longer it takes to fill the role, the higher the burnout rate, causing recruiters to sometimes panic and fill positions with less than capable people, just to avoid damaging the health of the other employees. High stress levels increase sickness, and further lost days of productivity, which can lead to a vicious circle of high turnover, and high burnout rate.
5. Low Morale
One of the most obvious and detrimental effects of high turnover, is low morale. This is highly contagious between employees, as it only takes one to start a chain reaction with others. Symptoms include feeling disengaged, unimportant, a sense of worry that their job might be next, a lack of team camaraderie and continuity, leading to people wanting to find new jobs.
6. Poor Employee Engagement
By continuously replacing employees, there is no real opportunity for employee engagement from management, as they’re not there long enough, and in fact this lack of engagement is a real problem. 66% of highly engaged employees reported that they had no plans to leave their company, while only 3% were actively looking for another role. Compared to 88% of disengaged employees who had plans to leave their company, with 31% actively seeking new employment.
So, what’s the solution?
Imagine if your employees could learn skills to manage their mood, increase levels of motivation, work smarter, more efficiently, increasing sales and productivity. Imagine if they could create a positive culture, where everyone is a highly valued team player. Imagine if they could resolve problems that existed outside work, and you as their employer gave them the training to do so.
Where would their levels of loyalty, trust and support be towards your organisation? What would they tell others about your company? What impact would this have on the number and quality of people who want to work with you? How would having the cream of the crop impact your business performance, and your bottom line?
Staff training and leadership development can save companies fortunes, and can save the fortune of the company. Leaders – management and above – either create or maintain the culture, and if the culture is toxic and people leave, they must take responsibility, and a new approach.
Problems that exist outside work, need to be dealt with to avoid bringing them inside work, and people need tools and strategies to do that. Having the skill set to take personal responsibility, is not only extremely empowering, but also increases levels of well-being and productivity.
Addressing these areas means you’ll have a happy, loyal and productive workforce, heralding the company name, and attracting more good people to work there. Attracting the best talent is THE competitive edge in today’s market, however keeping them takes continuous development – both personal and professional – in equal measure.
By considering this fully, and getting the right help, this one factor could change everything.