Cost of High Project Staff Turnover

By Gratien Gasaba

A couple of years ago, a head of an organization I worked for said he did not care about staff leaving his company. He argued that it is normal for an organization to open doors to both new incoming staff and incumbent staff that want to leave. He was replying to a claim by staffs that wanted better treatment in terms of working conditions and professional development. At that time, I did not deeply think about the impact of staff leaving and new staff hiring, simply because in that organization, things were going well in the middle of this high staff turnover. It is only when I was appointed Co-manager of a complex development project in its final year of operation that I witnessed the cost of high staff turnover. In fact, my predecessor left with a little more than 50% of key project staff, while some activities were still ongoing.

  • Corporate Memory LossIn most cases, staff departure means corporate memory loss. Some heads of organizations may not fully realize the negative impact of this loss arguing that new comers will be trained. However, training and induction may not be helpful.

    Though people are advised to put in writing the maximum of what happens in the project to ensure data recording, there is always some information that is not kept. Sometimes it is surprising to uncover that unrecorded information is very critical. Unfortunately you most often realize it only when the person who holds that unrecorded information has already left the project. For instance, it is possible to receive claim from contractors and other stakeholders when the person who closely followed the procurement process had left. In this case, new staff may try to analyze those claims when they realize they have insufficient information to efficiently handle them. In the end, the negotiation process may be conducted in the interest of contractors regardless of the actual reality. The departure of the person who is in charge of critical process may result into a corporate memory loss which in turn results into a financial loss.

  • Defect Repair

    Defects may be noticed after departure of a resource appointed to a particular activity with hands-on responsibilities. The experience in one of the projects I managed is illustrative. It happened when a subcontractor for a project on the construction left. This subcontractor was hired for laying tiles. He was familiar with the tiles cutters that were bought by the project. He was replaced by a new one who did not know how to use that particular machine and many tiles were broken and thrown away at the expense of the project. The financial loss that was caused by this defect repair was low, but this experience deserves special attention for it clearly illustrates the impact of staff turnover on the quality of work.

    In development projects, defect may not be visible enough especially when the project delivers soft results such as capacity strengthening and knowledge transfer.

  • Training and experience costs

    It is obvious that new employees need induction and other types of trainings which are associated with some costs. We should not forget that it is not that people are trained that they immediately get the know-how. Experience is always required to get accustomed with the culture and the vision of the organization you are working for. A key resource who has been working on a project is not only important for his/her knowledgeable skills, but also for his/her last time on the project during which he/she contributed to shape the course of the project with his/her feelings, attitude and organizational network. Before allowing the departure of every staff in the project or the program, it is better to analyze his/her experience to understand the cost of the replacement.

  • Stress, motivation and team building cost

    The program governance shapes its success in many ways. The leadership style of the project manager plays an important role in the achievement of the project results. The premature departure of a development project manager will be felt differently amongst project staff, depending on the working relation they had. Two years ago, I witnessed a staff member breaking down in tears after a bye-bye speech of a program manager. At the same time, a workmate whispered to me “I am relieved from his harassments”. New departures and arrivals create an environment of stress that has in turn impact on productivity. That’s normal! The new comer, unless she/he is already known, will be subject to questions about his/her attitude, leadership and lifestyle. There will always be a need for rebuilding the team as the new resource will absolutely need to forge working and personal relations with other staff.

  • New Comer to Take the Bull by its Horns

    It is unfair to think that every staff departure is a total loss and that the new employee will have difficulties or take time to get familiar with the job. Experiences have shown cases in which new comers perform better where predecessors have failed. In one of the projects I had the opportunity to manage some of its aspects were not being accurately reported on, because they were out of track. I tried to mobilize staff to face that reality to make change but in vain. One of the staff resisted to change. Three months later the person who was championing the resistance to change left and his successor together with me swore to work on the aspects that inspired fear. Two months later, the project celebrated that 80% of the fear-inspiring aspects were on track and reported on. In this situation the departure of a staff member was beneficial because his performance did not meet expectations. A new staff may be leveraged for success.

Gratien Gasaba is an experienced project manager with 9 years of experience in project and program management. He has also a consulting experience in business plan development and project evaluation. Mr Gratien Gasaba has a good working experience with both national and international experts in areas of organizational capacity development, governance, health and agriculture.

Article source: http://www.pmhut.com/cost-of-high-project-staff-turnover

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