Hurconomics for Talent Management: The Creation of a Business-driven HRD Missionary

9

Retention Strategies

Costs of Attrition

Quite often, the cost of leaving a company is underestimated. The following are the costs of attrition:

• Direct costs: Administrative costs, hiring and training costs
• Real costs: Productivity loss during vacancy
• Intangible costs: Loss of client relationships, impact on competitive edge, psychological impact on survivors

These costs are rarely calculated. Here is a method of calculating the costs of attrition:

 

Step 1:	Choose a target position for which the attrition costs are to be calculated (for example, senior sales manager).
Step 2:	List the total number of employees in the target group (for example, 20).
Step 3:	Note how many of these employees have quit in the last year (for example, five). ...