How to Avoid the Costs of Employee Turnover

by Michael Hyatt

If you’re running a business or leading a team, chances are you’re felt the effects of employee turnover. According to a Gallup study, losing an employee costs anywhere from one-half to two times the employee’s annual salary. For example, a 100-person organization that pays out an average annual salary of $50,000 could have turnover costs around $660,000 to $2.6 million per year.

Not to mention the unquantified costs of losing someone who was extremely talented and a good cultural fit. Or arguably worse, the pain of hiring someone who turned out not to be a good fit at all.

Hiring and keeping good employees is hard work.  It is critical that you take the time to slow down and really evaluate each candidate to see who will be the best fit for your company. It can be tempting to want to rush to hire someone. However, that could cost you in the long run. 

Finding the right employee—one who will be passionate and invested in the success of your business— sets you up for long-term success. It pays to hire the right person the first time. 

I get this question all the time: “How will I know who is the right fit?” I have four key qualities that I believe will help you narrow down your candidates to the person who will help take your team to the next level. 

4 Key Qualities of Great Employees

  1. Define exactly what skills the person will need to have to excel in the vacant position. This starts by writing a clear job description that specifically lists out each task you want this person to fulfill. The tasks will then define what skills are necessary.
    When evaluating each candidate review their resume, their references, and test them to see if they possess the necessary skills. This last item is one that is often overlooked. Don’t just look at their portfolio. Assign them a project that will show you their skills. If the amount of time needed goes outside what would typically be expected in an interview, you can offer to compensate them for the work. This small investment will pay off in the long run.
  2. Determine if they have the aptitude for the job. Are they teachable? Do they have the necessary natural inclinations to learn what you need them to as they go?? For example, you can utilize personality assessments to better understand what natural talents they have. We use the Kolbe assessment. You want to hire someone who will be thoughtful in their role.
  3. Assess whether the candidate has a good attitude. This can be harder to determine, but it is a critical quality to assess. I encourage you to develop a set of behavioral interview questions that are designed to screen for attitude. It’s also helpful to have more than one person interview the candidates and ask these types of questions. This is also a quality that their references can help provide insight into. Ask more than just what tasks they did. Ask about the manner in which they did them.
  4. Evaluate the candidate’s character. You want employees that you can trust. A good hire is one that you know will uphold the integrity of the company. Again, take the time to slow down and truly evaluate each person’s character. You can ask them questions about various scenarios and how they would respond. You can also ask them to provide past examples of when their character was tested and how they responded. I recommend having multiple people ask these types of questions as they may respond differently to people they consider a peer versus a boss. 

Before you start meeting with potential employees to think through each of the following qualities and write down who your ideal candidate would be. This will provide you with a tangible document to reference as you go through the interview process. 

The hiring process can be overwhelming. Slow down and take the time you need to find the right person for the job. Trust me, you will be glad you did.

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