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Hidden Costs of Employee Turnover

Updated: Jan 28, 2019

Executive Coaching Houston TX
Epiphany Professional Development

High employee turnover, poor #teamwork, low customer satisfaction, falling profitability – All indicators of more systemic issues, with disengaged employees being one of the greatest contributors. We’ve heard it over and over that globally, 67% of employees are not engaged, leaving only 33% that are highly or somewhat engaged. The former group makes up the majority of the workforce -- they may not always be your worst performers, but they may be indifferent to your organization, resulting in significant cost to your organization as indicated above.

Here are a few steps leaders and organizations can take to boost #engagement:

HR/OD practitioners may couch discussions in “development” terms rather than drilling down to tangible performance related issues that affect the bottom line. Don’t dismiss it, mentor, model and challenge them to define it and its impact in tangible business terms. As a leader, regardless of scope of responsibility, part of your role is to ensure alignment of executables with strategic objectives. If there’s any indication that your engagement numbers may not align with your strategic objectives and organizational success, ensure the following steps are being implemented to address these hidden costs and mitigate them.

1) Evaluate recruiting and selection to ensure organizational values, competencies and cultural needs are being met in the selection process – Get the right people on the bus from the beginning.

2) Evaluate your performance review process (or install one). Ensure clearly set expectations, SMART goals, that are employee driven and cultivate a conversation versus a one way data dump. While a performance review process when executed well, will improve overall engagement, it will also provide a foundation for ongoing conversations with employees that will lead to better decisions and collaboration. Train your management to provide constructive and corrective performance feedback. The largest complaints we get center on managements fear of conflict, delivering difficult feedback or simply not placing emphasis on the performance management process. Promote and place managers with the suitability to manage effectively. Checking suitability will match critical traits and competencies of candidates with available management positions. With this match and a well defined selection process, you will assure improved engagement and performance.

“When compared with business units in the bottom quartile of Gallup's database, those in the top quartile of engagement realize 10% higher customer metrics, 17% higher productivity, 20% higher sales and 21% higher profitability. Organizations at the top achieve earnings per share growth that is more than four times that of their competitors.” Source

Call us to schedule an evaluation of your selection processes, employee engagement levels, performance management processes and/or training associated with performance management and feedback. We’ll help you instill best practices that will heighten engagement and improve profitability.

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