This was the first issue of a FREE e-newsletter by
consultant/coach, speaker, trainer and author, Linda McNeil. Lin helps businesses
who want to be more profitable and keep their valuable people longer and more
productively. She provides practical Human Resources and retention tools, teambuilding,
customer service and teaches management and employees to effectively deal with
CHANGE. Nationally renowned as a world class keynote speaker!
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These newsletters will cover topics of turnover, retention, productivity, teambuilding,
customer service (internal and external), change and many other topics to help
businesses enhance The Bottom Line. Remember: Your People ARE your bottom line!
The Bottom
Line!
Vol. 1, Number
1, November 2003
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Publisher: Open
Mind Publishing ©2003
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Are You Ready to Lose $64,000?
It will happen if you are an employer & hire or fire
the wrong person!
When I recently searched the Internet for 2003 turnover cost figures, I got
over a million hits and found that experts agree current turnover costs are
from 30-200% of each departing employee’s annual salary! What concerns
me most is that many business owners are so focused on reimbursement, about
which they can do little, they are oblivious to the costs of turnover, about
which they can do much.
How is it possible to lose $64,000 on one person? Easy. Following are the costs
of launching a national search for a mid-level executive at a large corporation
in an urban market, detailed in a 2000 issue of “Working Woman”
magazine. Numbers will vary depending on your type of business and location.
We certainly can believe costs have gone up in many industries since then.
DO THE MATH:
Newspaper ads (run several months in local & national papers)
$8,000
Search firm fees (including commission for a prestigious national headhunter)
$10,000
Interview costs (factoring in coach airline fare, standard hotels, and meals
for
several out of town candidates)
$4,000
Managerial time (hourly value of four managers spending 25 hours each
reading resumes and interviewing)
$4,000
Work put on hold (minimal projects set aside for less than a month)
$2,000
Overload on team (overtime for one employee and compensation for a temp) $4,000
Training for new employee (assuming a one to two month learning curve)
$6,000
Lost contracts, customers and/or accounts (loss of some customers, but not
Key clients)
$8,000
Lowered office morale (employees’ hourly rate spent complaining at the
water cooler or surfing on-line classifieds)
$2,000
Loss of other employees (one other employee starting to look for new job)
$3,000
Signing bonus and other perks (minimal bonus)
$6,000
Relocation expenses (moving van, temporary housing for out-of-town hire)
$7,000
THE FINAL TAB:
$64,000
This same article “Best Bosses Tell All” goes on to suggest these
seven techniques for getting and keeping quality people: (I have added a few
editorial comments.)
1. Trust the Team – This means let your people use their strengths every
day. Don’t under-utilize your employees. Listen to what they suggest for
the business.
2. Make connections – some CEO’s make sure they check in and have
easy (purposefully not business related) conversation with each key manager
every day. This lets people know you care and creates a sense of community –
it doesn’t mean you have to become their best personal buddies.
3. Respect individuality – Fair doesn’t mean treating everyone the
same; that does your employees a disservice. It means allowing for and appreciating
their differences. (please see some of my material on using personality profiles
in web site article at Linda McNeil - Articles by Lin
McNeil. Find out their personal likes and dislikes and capitalize on them.
We know that employees primarily stay on a job because their managers create
a place where they want to be and/or they like the people.
4. Get Buy-In – share enough information and direction for the business
so they will want to be part of a team with mission and heart. Employees come
to a job with more needs than a paycheck. They may need power, companionship,
to fit in. Don’t expect them to be good team players unless you truly
are a good team leader. Support that with things like bringing in a teambuilder
to further build morale.
5. Say, “Thank you.” Every time I asked my more than 200 employees
over some 15 years what they wanted/needed more of—they said acknowledgment
and thanx from me! Pats on the back. What a shock. I thought they would want
more money or benefits. Build on the individual likes from #3: Some employees
appreciate flowers for a thank you, others want a thank you note, yet others
need public thanks and acknowledgment, while still others need private kudos.
6. Let Others Play—this is about delegating. If you have 10 employees
you should not be doing half the work yourself. A team shares responsibilities
and tasks toward a common end or goal. Some managers ask their employees to
lead meetings so they can sit back and observe the interactions and needs of
individuals in the group.
7. Take Responsibility—By all means, listen, reward, and be nice, but
not at the expense of keeping control. The buck still stops with the CEO or
owner.
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