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Hurconomics for Talent Management: The Creation of a Business-driven HRD Missionary by T. V. Rao

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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). ...

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