There’s no doubt that a high level of staff turnover is a key concern for business owners, both in terms of cost and long-term profitability. It thought that excessive turnover can cost an organisation around 33% of its employees’ compensation package, for example, whilst afflicted businesses may also see their profit margins squeezed considerably over time. So, the right recruitment and interim hires are important things for your small business.
A high employee turnover can also cause significant disruption to your business’s daily operation, as you may need to hire interim talent to plug specific gaps. This can often come at a premium, whilst this problem is exacerbated in instances where you lose a high-level executive or senior manager.
This is a significant challenge and one that entrepreneurs must prepare for in careful detail. Here are some of the key steps that can be taken to help budget for recruitment and interim hires.
1. Create a Contingency Fund
Even if you boast a relatively low rate of staff turnover, there’s nothing to stop your top talent deciding to move to a rival company.
This can be extremely troublesome for businesses, particularly with the cost of acquiring new talent thought to be five-times more expensive that retaining existing staff members.
So, whilst you may have a recruitment budget that has been developed based on insight and the estimated number of hires planned for the financial year, unexpected departures can leave you scrambling for at least £30,000 to source a replacement (on either an interim or long-term basis).
To negate this, you need to manage your overall budget more wisely and create a contingency fund that can underpin any unexpected or interim hires. This can provide a significant safety net that negates the impact of losing experienced management staff, so long as you factor in the potentially higher cost of interim employees and those hired on temporary contracts.
2. Liaise with an Expert Recruiter that can Provide Skilled Employees
In some instances, it’s also important to note that a decline in productivity caused by the loss of a manager can be more costly and the price of hiring an interim replacement.
In this case, it’s imperative that your business is able to move quickly when looking to source a replacement, and this requires it to have an existing relationship with focused and specialist recruitment firms.
Service providers such as Interim Partners offer a relevant case in point, as they supply high-level consultants and interim executives who have experience of working with the world’s leading corporations.
Regardless of whether you’re in the midst of a significant transformation or working on a complex and detailed project, this type of employee can hit the ground running in your venture and minimize any potential loss of productivity or profitability.
3. Instill Recruitment Marketing Skills within your Team and HR Department
Over time, another preferable strategy is to create an internal workforce and HR team that boasts a number of valuable recruitment marketing skills.
This enables the people within your business to develop a network of skilled executives, which in turn makes it easier to hire interim staff members in instances where a manager leaves your business.
The good news is that many of these skills are transferable too, from social media interaction to employer branding and targeted content marketing. By instilling these skills in selected and relevant staff members, you can target the very best talent in your industry and make it far easier to recruit interim staff members.
Although there’s an argument here which suggests that training your employees will incur higher initial costs, this will also deliver significant savings over time. Not only this, but this type of focused approach can also minimize the risk of employees leaving your business in the future, as you hone your recruitment efforts and build relationships with your staff members.
