1. Human Resource Management
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Climate and Culture Measures
The purpose of this discussion is to help you achieve Course Outcome 4 and Module Outcomes 1 & 2.
As discussed during this week, climate measures may be easier to gauge than culture measures and are more focused on current perceptions in the workplace.
As with anything related to change management, you need to know the current state to effectively determine how to reach a new future state.
For this week’s discussion, select ONE of the following prompts to answer:
Your organization has a chronic turnover problem. What lagging indicator(s) can help you identify the situation to create an effective strategy? Explain and give an example.
Your organization has a chronic high absenteeism problem. What indicator will you use to determine what the climate is like at the organization (poor leadership, cynicism about change, high burnout, etc.) and how it is impacting performance? Explain and give an example.
Mention one direct and one indirect cost associated with turnover. What strategy can help you minimize them? Explain and give an example.
Thinking about the problem of turnover, what are some not-so-common measures you would collect to see what prevents the problem from developing and how would you collect them? Explain and give an example.
2. Human Resource Management
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Shannon Garcia
Dec 31 11:28am
Manage Discussion by Shannon Garcia
Reply from Shannon Garcia
Understanding Turnover Costs: Direct and Indirect Impacts, and How to Minimize Them
Employee turnover is a universal challenge for organizations, particularly in high-volume environments like call centers. While some level of turnover is inevitable, excessive rates—such as the 100% turnover I experienced in a call center workforce—can wreak havoc on both financial performance and workplace culture. To effectively manage turnover, it’s crucial to understand its direct and indirect costs and strategies to minimize them.
Direct Cost: Recruitment and Training Expenses
Recruitment and training are among the most significant direct costs associated with turnover. Organizations must invest in advertising, interviewing, onboarding, and training replacements when employees leave. These costs increase quickly, especially in high-volume industries. For example, in the call center I managed, the cost of recruiting new agents included advertising job openings on multiple platforms, conducting interviews, and dedicating time and resources to train new hires on the systems, processes, and customer service standards. According to Forbes (2019), the average cost to replace an employee is about six to nine months of their salary. The expense may seem minimal in a call center where entry-level roles are typically lower paid. Still, considering the high turnover rate, these costs compound rapidly, resulting in a significant financial drain.
Indirect Cost: Loss of Productivity and Team Morale
Beyond the tangible expenses, turnover leads to less visible but equally impactful indirect costs. Productivity often declines as teams are forced to pick up the slack for vacant roles. In a call center setting, this means longer customer waiting times, reduced service quality, and increased stress for the remaining staff. Additionally, constant turnover can erode morale, creating a sense of instability and disengagement among the team.
During the period when my call center faced 100% turnover, these indirect costs were painfully evident. Customers became frustrated with inconsistencies in service, and employees who remained felt demoralized by the revolving door of new hires. This ripple effect amplified the turnover problem, making it harder to stabilize the team and achieve performance goals.
Strategy to Minimize Turnover Costs: Building a Culture of Engagement
Fostering a culture of engagement and accountability is one effective way to reduce direct and indirect turnover costs. Employees are more likely to stay when they feel valued, supported, and connected to the organization’s mission.
In the call center example, we implemented a comprehensive strategy to improve retention:
Structured Onboarding: Instead of overwhelming new hires with information, we broke the training into manageable phases and paired each new employee with a mentor to guide them through their first few months.
Regular Feedback and Recognition: We introduced monthly check-ins to provide consistent feedback and celebrate achievements. Small acknowledgments, like recognizing top performers in team meetings, helped employees feel appreciated.
Career Development Opportunities: Offering clear paths for advancement and cross-training opportunities gave employees a reason to invest in their roles long-term.
As a result, turnover began to decline steadily. One standout success was an employee who started as a customer service agent and later advanced to a supervisory role. By investing in their development, we retained a valuable team member and created a positive example for others.
Turnover is costly, both in visible expenses like recruitment and hidden impacts like reduced productivity and morale. However, with intentional strategies to engage and support employees, organizations can minimize turnover’s effects.
In high-turnover environments like call centers, structured onboarding, consistent feedback, and clear opportunities for growth are essential. By investing in your people, you can reduce costs, improve retention, and build a more stable, productive team.
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