What’s the real cost of losing an employee?
Frequent turnover, voluntary or involuntary, has a negative impact on employee morale, productivity, and company revenue. In a recent article on employee retention, Josh Bersin of Bersin by Deloitte outlined factors a business should consider in calculating the "real" cost of losing an employee.
Cost of on-boarding — a new person including recruiting and management time.
Lost productivity — it may take a new employee 1-2 years to reach the productivity of an existing person.
Customer service and errors — new employees take longer and are often less adept at solving problems.
Training cost — for example, over 2-3 years a business likely invests 10-20% of an employee's salary or more in training
Cultural impact — When someone leaves others take time to ask “why?”
Involuntary turnover, though sometimes unpleasant, is often necessary in a growing business. In these situations, the cost is minimal compared to a toxic or unproductive employee. But how do you improve employee retention of your best talent? According to a Globoforce article outlining the following tips for reducing turnover through strategic recognition, recognized employees stay put:
Create a culture of recognition — The single most effective way to reduce turnover and keep your top performers is to create a culture they cannot imagine leaving. Recognized employees stay put.
Make your managers better managers — Employees leave their managers, not their employers. In a positivity-dominated workplace, ere all managers seek out and reward legendary performance, everyone wins.
Find and develop top talent — Do you know who all your best performers are? Do you have metrics that can point you to the most influential people in your organization? Know your future leadership so that you can keep and develop them.
Attract top performers — Part of keeping talent is in attracting the right people in the first place. Strategic recognition shows applicants how your company puts people and culture first.
See flight risks — Learn to recognize where high-potential employees may be neglected to prevent losing top talent.
Sources: http://www.linkedin.com/today/post/article/20130816200159-131079-employee-retention-now-a-big-issue-why-the-tide-has-turned http://www.globoforce.com/why-recognition/reduce-turnover/
The Culture Counts blog is a discussion of law firm culture and legal innovation, including topics such as effective leadership, employee engagement, workplace culture, ideal work environment, company core values, and workplace productivity.
Sign up for and explore our content and thought leadership here.
About the Firm:
Klemchuk LLP is a litigation, intellectual property, transactional, and international business law firm dedicated to protecting innovation. The firm provides tailored legal solutions to industries including software, technology, retail, real estate, consumer goods, ecommerce, telecommunications, restaurant, energy, media, and professional services. The firm focuses on serving mid-market companies seeking long-term, value-added relationships with a law firm. Learn more about experiencing law practiced differently and our local counsel practice.
The firm publishes Intellectual Property Trends (latest developments in IP law), Conversations with Innovators (interviews with thought leaders), Leaders in Law (insights from law leaders), Culture Counts (thoughts on law firm culture and business), and Legal Insights (in-depth analysis of IP, litigation, and transactional law).