Investing in culture pays off. Determine the potential ROI of employee retention measures. A positive corporate culture can lead to greater economic success.
How do we calculate the increase in operating profit?
Calculation:
1.
Formula: Lost sales due to disengaged employees + potential savings from avoidable layoffs = increase in operating profit
In your case:
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How do we calculate the potential savings from prevented terminations?
Key figure:
⅓ of employees can imagine resigning in the next 3-6 months (McKinsey) → 0,3
41% of employees would make improvements in the area of engagement & culture (Gallup) → 0,4
Replacing an employee costs 6-9 times the monthly salary (SHRM) → Mean value 7,5
Calculation:
1.
Formel: Number of employees * 0.3 = employees willing to resign
In your case:
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2.
Formel: Employees willing to resign * 0.41 = Number of employees who want improvements in the area of culture
In your case:
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3.
Formel: Average annual salary / 12 (months) * 7.5 = cost of filling a position
In your case:
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4.
Formel: Number of employees who want improvements in the area of culture * Cost of filling a new position = potential savings from avoided redundancies
In your case:
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How do we calculate lost sales due to disengaged employees?
