Tag Archives: turnover

How much will it cost when your key people leave?

NetworkingHow likely are you to lose your key employees?

According to Gallup, only one-third of U.S. employees are engaged in their work and workplace. And only about one in five say their performance is managed in a way that motivates them to do outstanding work. What’s worse, 51% of employees are actively looking for new jobs.  The answer is, you are very likely to lose an employee very soon.

How much will it cost when your key people leave?

What does it cost to replace an employee?  The range is large, but it is expensive at any level.  Studies show it can cost 20% of a low-to-mid-range position and more than 200% of a high-level or executive position.  Let’s look at the numbers.  The cost to replace a mid-range administrative manager being paid $40k would be about $8k.  But the cost of a highly educated contributor, director, or executive who’s paid over $200k would be over $400k.

What goes into calculating turnover costs?

  • Hiring (advertising, interviewing, screening, hiring)
  • Onboarding (training and management time)
  • Lost productivity (months, years to match a high performer’s level of performance)
  • Low team engagement (other employees are affected when someone leaves)
  • Customer service and errors (new people don’t know what they’re doing and make mistakes)

The costs may be much greater in your company, especially if a key person leaves at a critical time.  Missing a release deadline could cost the company funding or market share.  Lost knowledge could cause a faulty product to be released.

How will you keep your best people?

The top way to keep employees today is to engage them.  This means allowing them to do meaningful work that helps them grow.  When people are doing something that matters and are growing in the process, they are likely to stay.

Sixty percent of employees say the ability to do what they do best in a role is “very important” to them.  The problem is that people often don’t know what they do best, and it’s even harder for their employers to know.  The solution is to assess what people’s natural talents are and let them do work where they apply them.

A fun way to assess people’s natural talents is in a team-building session where people self-assess and share their talents with their team members.  People get excited about their discoveries and they learn how to better engage each other in projects.

If you are leading a team and you want to keep your key players, you may want to give our Strengthen Your Team Team-Building Activity a try.  It costs only a small fraction of what it costs to lose someone, and it will pay back even more in terms of the increased productivity and engagement of your team.  You will also have fun discovering how your own natural talents come into play.

CertStrCoachLogo_Spot_g_WebOnly

Millennials: Your Reputation Is Key

By Joanie Connell

Last week I received a call from a lawyer who wasreputation up in arms about a Millennial he had just hired. But don’t stop reading because this is not a Millennial-bashing blog post. Millennials, this post is for you, to help you develop one of the most critical pieces of your attractiveness as an employee—your reputation.

The lawyer is a solo practitioner and he hired a college grad who is interested in going to law school to assist him. Literally, on the first day of work, the young woman said she was interested in other opportunities to get more experience in different types of law. When the lawyer questioned her further, the woman said she was, indeed, looking for other jobs and she might move home (to a different city) in a couple of months if she couldn’t find a good apartment here.

The lawyer hadn’t offered her the job lightly and he had said he was looking for a 1-year commitment. It was a big decision to hire her over anyone else and he had a big need to fill, being a single-person firm. He was investing a good deal of time in training the woman as well. To have to replace her within a few months would impact the business significantly.

It’s no secret that Millennials have a high turnover ratesome reports are as high as 60%. Others report that Millennials measure their job tenure in months, not years. I’ve also seen the Millennial work ethic described as a “self-centered work ethic.”  No matter how you put it, Millennials are seen as having one foot out the door.

The problem for Millennials is that you only have one reputation to maintain and you are getting a bad one. This is not only an overarching view of an entire generation, but a view of you, yourself, individually. If you switch jobs capriciously and mistreat employers in the process, you will lose credibility in the workplace. Reliability is a deal breaker. I, personally, don’t care how smart, well-educated, or experienced someone is if they are not going to show up. Seriously, what’s the point?reputation 2

The point is, it’s not only about you. Millennials, I know you get this because you have the reputation of being the most socially responsible generation yet. You understand that you are part of a larger system of Mother Earth and what you eat, buy, or do affects people on the other side of the planet. What you do also affects people closer to home. And despite what you think, people notice what you do (even if it’s not posted online).

Given the high turnover rate among Millennials, the lawyer in this case wondered if hiring a new college grad was the way to go. He also wondered if hiring a new college grad from a good university was the best idea. He contemplated hiring someone from the local community college who might need the job more and appreciate hard work and commitment. He observed that the privileged woman didn’t have a solid work ethic, need for a job, or understanding of the big picture. (The woman also asked, within 3 weeks of employment, if she could take a vacation day to go to the beach.)

This is just one lawyer, but he is not alone in his experience. I have numerous stories like this one. Millennials, take this as a wake-up call. You need to build your reputation to be employable. I can tell you right now that the young employee in this story won’t get a positive recommendation from her current employer. After a point, college grades and letters of reference from professors don’t carry any weight. It soon becomes all about what you can produce, the quality of your work, and how reliable you are in getting things done. Your reputation is key.

Stereotyping is bad and ageism is illegal. Hopefully, employers won’t base a hiring decision on a generation’s reputation, but they will base it on yours.