Impacts of Staff Turnover on Company's Revenue (Essay Sample)
The instructions of this paper required one to carry a research on the impacts of staff turnover on company’s revenue. This sample paper provides detailed information on how staff turnover leads to low productivity and collapse of companies. It also details on the cost of staff turnover in terms of knowledge management and recruiting new staff members.source..
2 Low productivity
3 Cost of staff turnover
4 Knowledge management
5 Collapse of companies
6 Impacts of new staff
Impacts of staff turnover on companyâ€™s revenue
Turnover is an accounting term that is used to explain the amount of money an organization makes in a given period from its customers. However, "the same word is also used in non-accounting sense to refer to the rate at which people come and go, and it is normally applied in referring to staff and customers," (Fraser-Sampson 50). "Turnover can also be described as the voluntary and involuntary permanent withdrawal from an organization," (Robbins 18). Employeesâ€™ turnover has both positive and negative effect on a given organizationâ€™s revenue. However, high staff turnover depict poor self-esteem or observance of unsound practices within an organization. On the other hand, "high customer turnover portray customersâ€™ dissatisfaction with products and services offered by a given company," (Fraser-Sampson 50). This paper aims at providing detailed information as to why staff turnover is bad for the companyâ€™s revenues. It will expound on issues such as increase in recruitment and training costs as a result of staff turnover.
High staff turnover may have a negative impact on a given organization. It may lead to the decline of the rate at which an organizationâ€™s produces its products if potential workers withdraw. "In the United States contest, the average total national turnover is about 4% per month, which leads to about 48% turnover per year," (Robbins 18). Unfortunately, over 90% of the people that leave their respective jobs in the U.S have been found to be better than their superiors. Thus, it is evident that when turnover is high, a company loses competent workers and as a result lowering the companyâ€™s revenue.
Cost of staff turnover
"When taking into account the expenses (such as time taken in selecting and recruiting employees, and the lost productivity in a given company), the cost of staff turnover is very high," (DiJulius 14). According to DiJulius (14), the cost of replacing an employee in any organization is approximately 145% of a working employee. This clearly outlines what organizations face financially when the rate of ...
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