How loopline can help you

Our assumptions are based on studies indicating that depending on the employee's experience and responsibility, the total costs of their turnover varies between 4 monthly salaries for entry level positions, to 24 monthly salaries for executives. According to industry surveys, employee fluctuation can be decreased by about 15,2% while productivity can be increased by 5.4% with the help of performance management systems. Vacations, holidays and sickness days are not taken into consideration in the equation. See sources section.

• Hours / working day 8
• Days of work / week: 5
• Weeks / months: 4
• Days per month: 30
• Efficiency lift by PM: 5.4%
• Total costs for losing lower skilled employee in monthly salaries: 4
• Total costs for losing experienced employee: 8
• Total costs for losing specialized / team management employee: 12
• Total costs for losing executive employee: 24
• Gross calculation is based on average of total costs for losing employees in monthly salaries: 8.4
• Average decrease in employee turnover through performance management: 15.20%

Financial

HR staff (e.g. exit interview)

Manager's time (e.g. exit interview)

Accrued paid time off

Temporary coverage (e.g. overtime)

Replacement Costs

Delta of new hire's compensation

Hiring inducements (e.g. signing bonus, relocation)

Hiring manager's / recruiter's time

Orientation program time / material

HR induction costs (e.g. payroll)

Training Costs

Training Costs

On-the job training (e.g. supervisor / new employee's time)

Socialization (e.g. other employee's time, travel)

Productivity loss until new employee has mastered job

Mentoring time (mentor's time)

Other

Delays in production / customer service

Lost customers

Customers not acquired (opportunity costs)

Stiffer competition (employee moves to competition or builds own business)

Contagion (others employees leave as well)

Disruption of team based work

Loss of workforce diversity