Have you ever been in the midst of an incredibly busy period at work, and an employee puts in his or her two week notice? What type of emotions did this scenario invoke? If you're anything like me, you felt a combination of anxiety, stress, frustration, confusion, anger and about 10 other less than desirable emotions in the moments that followed the receipt of the notice.
Even when business is steady, losing an employee - especially one who showed promise, worked hard and got the job done - can be an unsavory prospect. The primary impact will undoubtedly be on you and your colleagues who are not leaving, as this type of situation would necessitate the launch of a recruitment strategy, rapid onboarding and lots of time to get the new hire up to speed.
Unfortunately, this is not the only type of challenge that will be seen when employees leave. Continuity of services, the integrity of the business image, and client retention will all be at risk when a firm is understaffed or important team members leave. When it comes to keeping your clients happy, your community association management business will need to ensure that the threat of turnover is minimized by any and all means necessary.
Keeping your clients happy during employee transition can be particularly important if the employee you are losing is a community manager. Communities are likely to follow a manager they are happy with, and this can be devastating to your portfolio, on top of all of your other headaches.
Let's go through some of the basics of employee turnover, as well as the factors that ought to be covered in engagement strategies to prevent issues when staff members do, in fact leave.
The High Cost of Employee Turnover
Employee turnover is an understated, but highly dangerous risk to businesses of all types and sizes, as the costs associated with the issue can be devastating in some instances. Because companies will face direct and indirect damages when employees leave the company, much of which dictated by the rank and tenure of the staff member in question, virtually all firms should be focused on building strategies to retain their workforce members.
The Small Business Advisor estimates that a low-ranking member of staff will not be quite as expensive as a managerial or executive when it comes to turnover, but neither is in any way cheap. According to the source, the average cost of one employee exiting will be 150 percent of that individual's annual salary, putting this into perspective, a staff member who makes $50,000 a year will cost $75,000 to replace. That figure factors in everything from recruiting costs to lost productivity and depleted efficiency given the new employee's training period.
Now, it is worth noting that different researchers and analysts have varying methodologies when approaching these types of calculations, and that these are all averages. Still, think about it this way. If we were to say that the Small Business Advisor's findings represented the middle of the road - which it does, compared to other research that puts the figures much higher or lower - this would still translate to tens of thousands of dollars in losses should only two or three staff members leave in one year.
Does your CAM business have that kind of bread to throw to the geese? Probably not.
To truly understand how much employee turnover can impact you, consider checking out this handy worksheet that calculates the specific cost of turnover for your unique business, provided by Do Good Consulting and informed by the U.S. Department of Labor. If you just clicked, filled it out, and your jaw is now on the ground, definitely keep reading.
Sometimes, there will be literally nothing you could have done to change the mind of an exiting employee. However, more often than not, staff members leave because they are not engaged, which could be caused by lackluster salaries, poor treatment, lack of fulfillment or otherwise.
According to Wikipedia, "An 'engaged employee' is one who is fully absorbed by and enthusiastic about their work and so takes positive action to further the organization's reputation and interests."
Engagement should be the priority to prevent high turnover rates, and it has not appeared to be in the United States at any point, really. A landmark study by Gallup found that the vast majority of the American workforce is not engaged with current jobs and responsibilities. Just how bad were the findings? Gallup stated that only 31.5 percent of employees in this fair nation were engaged on any level in 2014, which is somewhat embarrassing, and certainly worrisome.
Employee turnover can have a wide range of negative impacts on your CAM business - and virtually no positive ones - and should be taken seriously to avoid the high costs and other complex challenges involved. By focusing on boosting employee engagement through carefully crafted strategies and plenty of improvements to internal communication, you can effectively reduce your risk of feeling the strain and stress of staff churn.
*Image credit: Pixabay user Bevlogenteams