By definition, high impact businesses are high growth businesses. A high degree of change is necessary in high impact businesses to respond to market pressures: demand for improved delivery of services, global influences, rapid changes in technologies and increased competitiveness. But a traditional employment model doesn’t allow businesses to be agile enough to adapt quickly to changing business needs and conditions.
Existing employees often lack the skill sets and competencies needed for new business, and training for new skills isn’t always an effective option in a fast-paced environment. High labor costs as a percentage of the cost of doing business makes it imperative that businesses maximize their return on investment in people. Added to these challenges, employers are losing their ability to respond to business issues as experienced employees retire and take with them the institutional wisdom that they bring to the conference table.
Not only are many high impact businesses caught in this “war for talent,” but turnover rates combined with rising retirement rates foretell future difficulties in having the talent on-hand to meet growing and changing business conditions.
Read more about how just for a one percent decrease in turnover, every company could realize annual savings between $400,000 and $4 million depending upon the size of the company. Even for a company with as few as 64 employees, savings averages approximately $8,000 by reducing employee turnover by 1 percentage point.
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This makes sense, continuous retraining for new employees that do not stick around and do not product only creates additional spending.