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“Are your part time employees getting full time pay?”

With layoffs dominating the headlines it seems hard to imagine a time when one of the biggest problems facing senior executives will be retaining and replacing key talent. But the resume tsunami is already building.

In a Forbes Insights global survey of senior executives 65% reported they were “highly” or “very highly” concerned that high-potential talent and leadership would leave once the economy turns and 52% predicted an increase in voluntary turnover at their companies once the recession ends, four times the number expecting a decrease.

Did you know that replacing an employee costs you 30-50% of the annual salary of entry-level employees, 150% of middle level employees, and up to 400% for specialized, high level employees?

If a company loses just ten supervisors a year, it is reasonable to compute the bottom line replacement cost at $500,000. The top line cost? If the company’s profit margin is 10%, then it costs $5,000,000 in revenues to replace these ten supervisors.

I don’t know any CEO who wants to lose $5.0 million in revenue.

Leaders that adopt my advice reduce the risk of turnover and loss of institutional knowledge. When leaders transform themselves they in turn transform the people around them.

Effective leadership is not a choice! If we can’t effectively lead people they either leave or they “retire on the job”.

What’s at stake is having a culture that provides a sustainable competitive advantage or one where staff is disengaged or they leave taking priceless institutional knowledge with them.