Studies that might be useful to you have been published by the
Saratoga Institute and in Harvard Business School's "Harvard
Management Update".
"The Society for Human Resource Management (SHRM) has reported
findings by the Saratoga Institute in Santa Clara, California, that
the average cost of replacing an employee is equal to their annual
salary plus benefits."
Leadership Answers
http://www.leadershipanswers.com/ArticleDetails.asp?ID=555
"According to Kepner-Tregoe, 'Avoiding the Brain Drain' ... 'The loss
of high performers costs more than money. It tends to impair the
organisation's memory, dilutes the ability to perform, and compromises
the will to win'.
However, the Saratoga Institute Turnover Costing Model puts direct
costs as being:
Cost of termination (including any pay out arrangements);
Cost of hiring (including advertising expenses, recruitment
consultant's fees);
Cost of the new hire (only 60% as effective in the first 3 months
compared to an experienced employee).
In short, estimates of turnover cost range between 1 to 2 times an
employee's annual salary and benefits."
Barrett Consulting Group
http://www.barrett.com.au/News/Newsletter/summer2003/
"The cost of replacing an employee averages between one and two times
the candidate's salary plus benefits.
The cost of replacing an employee averages between one and two times
the candidate's salary plus benefits. So for a $50,000 salary the cost
of losing that candidate ranges between $65,000 and $115,000. The cost
is higher in sales departments, where the loss of productivity,
revenue, cash flow, and even clients is astonishing."
Positive Results
http://www.positiveresults.com/sales_hiring/
"In an article published in the Harvard Management Update it was
concluded that the cost of replacing an employee is likely to be a lot
more than the widely accepted rule of thumb of about half of his or
her annual compensation.
The Harvard Business School publication said, direct costs-recruiting,
interviewing, training, etc.-are the tip of the iceberg. When indirect
costs-including the effects on workload, employee morale and customer
satisfaction-and 'opportunity costs,' such as loss of intellectual
capital, are factored in, replacing an employee is likely to cost
twice the departee's annual salary."
Tomorrow Today
http://tomorrowtoday.biz/disc/
"Replacing an employee is estimated to cost twice the departee's
annual salary. In today's tight labor market, managers are beginning
to realize that they need to focus on keeping the employees they
have."
Harvard Business Online
http://harvardbusinessonline.hbsp.harvard.edu/b01/en/common/item_detail.jhtml?id=U0004A
"The cost of replacing a "mis-fit" far exceeds the dollars in salary.
Replacing an employee typically impacts morale, ongoing workload, and
possibly re-training other employees. Be aware that the cost of
replacing an employee could be two to three times the person's salary
in hours and recruiting."
BrainBuzz
http://jobs.brainbuzz.com/EmpArticles/Buzz1115.asp?R=&CSRE=
Google search strategy:
Google Web Search: "bad hires cost"
://www.google.com/search?hl=en&ie=UTF-8&oe=UTF-8&q=%22bad+hires+cost
Google Web Search: "cost of replacing an employee"
://www.google.com/search?hl=en&ie=UTF-8&oe=UTF-8&q=%22cost+of+replacing+an+employee
I hope this information is helpful. If anything is unclear, or if a
link does not function, please request clarification; I'll be glad to
offer further assistance before you rate my answer.
Best regards,
pinkfreud |
