One of your leading Sales Managers just informed you he’s decided to take early retirement and will be leaving at the end of the month. After 20 years in the residential building sales industry, he’s decided to relinquish his highest generating sales executive role for the calmer, leisurely life of world traveler he’s always imagined living. Unfortunately, that traveling starts in two weeks, leaving you little time to find a replacement. This was probably not the Monday morning you were anticipating!
Suddenly losing a valued employee is probably not an unfamiliar scenario for most hiring managers. However, the full impact open positions can have on a company may not always be that clear. Finding the right person to fill open executive positions costs not only time and money in candidate searches and recruitment, it also requires effort and resources in training someone new. Additional time is lost as new execs learn to lead their new teams effectively, which create more revenue and resource losses. Addressing key issues that prolong time executive positions remain open is an important step to saving your company from incurring any additional expense.
One potential cost from prolonged open positions that is sometimes overlooked is an increase in employee turnover. This unforeseen consequence can lead to other factors that further delay your ability to keep positions filled. New employees don’t always work out, and replacing them, of course, costs more time and money in training expenses and employee searches that are never recouped. Sales teams lose revenue when management turnover increases, leading to decreased job satisfaction and team spirit, poorer job performance, and higher employee turnover. Losing a team member impacts a sales team as a whole, incurring additional costs filling open positions, which creates more training needs, more time lost, more over-burdened, unhappy employees, which leads to more job vacancies, and…well, you get the picture. This domino effect can have a long-term impact on a company’s overall financial health that’s sometimes hard to recover. Prolonged adjustment periods from new hires can also put undue stresses on current employees. Learning new routines and adjusting to changes in leadership can take time and interferes with individual employee growth. Instead of perfecting and honing their skills, employees spend valuable time learning new management styles and adjusting to new team dynamics.
It’s important for companies to absorb some of these revenue draining losses before they find themselves permanently in the red. Creating an effective training program will help reduce time lost and wasted training expenditures, and can significantly decrease the frequency and length positions remain open. Spending the necessary resources needed to give new employees and executives proper tools and incentives to perform their jobs well improves company commitment and overall job satisfaction, which leads to increased job retention. A returned growth in sales and productivity follows, offering companies a much-needed respite from some of that financial drain they recently endured.
Having a system in place that ensures you are investing in the right people will help decrease any continued financial and employee losses as well. Many companies create benchmarks to reach within a limited timeframe upon hire. These help employers determine whether someone is fulfilling necessary job requirements before investing more time and training in someone they may not keep. By investing resources in good hires and identifying potential problems early on, employers can reap the benefits that long-lasting, well-trained executives and employees bring, while still cutting their losses early on with new hires that don’t pan out. These strategies are a great way to curb over-expenditures from prolonged open executive roles, and create stronger financial health and longevity of your company in the years to come.