The Cost of Employee Turnover

Turnover? Please don’t talk to me about your employee turnover problem.

I was the turnover king for the first several years after I started my practice.

I fired people on the spur of the moment.

People quit after a week.

I had one person come and go in a single day.

I had people go to lunch and never come back. It was insane.

I hired fast and fired fast; I did everything fast.

It was a disaster.

Employee turnover is a killer. It costs us in a bunch of ways. The obvious costs involve lost sales, delays in producing the work, and an overall drop in productivity.

Those are, however, the obvious costs. There is subtle fallout that often goes unnoticed.

There’s the impact on other employees. They get sucked into the vacuum created by the absent employee. They end up covering while someone new is selected and their own work gets neglected. That affects their sense of accomplishment and pride. Their own deadlines get pushed back, and they’re disappointed with their progress.

Existing employees end up jumping in to train the replacement employees, and that further stalls their plan to accomplish their objectives.

Further, when someone leaves, everyone who stays wonders who’s doing the right thing. “Should I leave too?” is a question that many employees will ask themselves privately when their peer packs up and moves on.

Of course, turnover can result in a loss of clients both directly and indirectly. Some clients will go with the separating employee. Some will leave when their cases are neglected. In either event, the loss of clients affects revenues, and that’s not a good thing.

Finally, turnover affects the reputation of the firm in the legal and business community. Others wonder what’s going on when employees come and go. They question whether the firm leaders really know what they’re doing.

Turnover is demoralizing for everyone involved, and excessive turnover is never a good thing.

However, I can hear you agreeing and then jumping in with “but what do we do about (fill in the blank with name of annoying employee)?” I know, I know, you really need to get rid of her.

How do you balance the cost of turnover with the cost of keeping an unsatisfactory employee?

You can’t. This problem isn’t solved by keeping people who can’t cut the mustard.

The problem is solved by hiring better, training better, setting reasonable expectations, and managing your people to success. You’ve got to find ways to hire and keep good employees and end the cycle of coming and going.

Of course, there are costs associated with better hiring, better training, and professional management, but those costs pale in comparison to the cost of turnover.

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