Do you know what employee attrition really costs your organization? You might be speculating the answer, but it’s not that easy to say!
Corporate people often discuss and debate over increasing employee turnover causes, issues and costs. Many people believe that turnover costs are hidden. It means employee turnover costs are neither calculated in the company budget nor do they hit organization’s profit / loss reports (for that matter). But it is unfortunate that employee turnover rate somehow affects company’s bottom line.
Let’s see what happens when employee attrition increases:
Reduce Productivity
When an employee leaves a job, the company surely loses some productivity. When the position of an ex-employee is vacant, the lost productivity affects the project deadlines and company revenue.
Even if the most important tasks are taken up by other team members, there are other less significant things that fall out of place; thereby reducing team productivity and performance.
Knowledge Loss
A new hire can definitely do all those tasks that were previously done by an ex-employee, but do you think the specific knowledge and expertise remain same…? I guess, NO!
Business is not always about selling a product, writing programming codes, filling excel sheets or maintaining databases, there’s something more to it. The art of maintaining relationships with existing clients, know-how of an organization and their exceptional experience build a successful business organization. When an employee quits, this knowledge goes away. That’s why this information and acquaintance is more precious than anything else.
Training Costs Are Higher
When a new employee is trained, the company spends hundreds or thousands of dollars on the training process. The training costs are added directly into the company expense.
It becomes expensive when an employee doesn’t make best use of the training opportunities or quits the job.
These factors clearly reflect how a company faces unavoidable costs when employee attrition increases.
Aren’t these costs difficult to estimate? Indeed, they are!
In today’s stringent economy, it is important to avoid high employee turnover rate. Management should seamlessly make efforts to satisfy their employees and keep them happy by providing all the possible facilities, resources and perks. Retaining top talent is a challenging task, but it certainly costs less than employee turnover. Adopting well-planned retention strategies, increasing employee satisfaction and consistently acknowledging employee accomplishments are few ways to promote employee engagement and control employee attrition rate.
Tips to Reduce Employee Attrition
Hire Right Candidate
Filling in vacant position is not an easy task, but recruiters should take enough time to hire the right person who fits well in company culture.
Well-Designed On-boarding Plan Works Better for New Hires
Orientation or welcome programs should convey all the important company policies to the new employees so that they stay well-informed. A strategically planned onboarding program leaves good impact on the new hires and helps in employee retention.
Make Employee Training an Important Part of Office Curriculum
Top talent is attracted to workplaces where they get ample opportunities to learn, develop and grow. Training opportunities coach employees as well as managers in different areas of employee relations.
Fairly Defined Work Goals
Well-defined SMART goals allow employees to achieve bigger milestones in their career within realistic timelines. It allows employees to perform extremely well which gives them a sense of job satisfaction.
Offer Competitive Remuneration & Benefits
Believe me or not, but competitive compensation definitely attracts top talent. To maintain best talent pool, make an offer to employees that they can’t reject.
There’s no denial to the fact that employee turnover is extremely expensive. Therefore, it is better to do a good job in retaining employees rather than letting them go.
HR people must take time to analyze employee exit interviews. Knowing reasons of employees’ exit will help them to come up with better retention strategies and control employee attrition rates effectively!
