When staff that is needed leaves the organization. This includes voluntarily, departure initiated by staff for their own reasons, or involuntarily when the organization initiates the separation based on staff behavior or performance. Organizations may choose not to consider certain separation occurrences as attrition if there is no business impact or need to replace the loss within a certain period of time.
Measurement: (Staff Requiring Replacement)/ (Current Staff Count + Staff Count Requiring Replacement) or (Staff Requiring Replacement)/ (Average Staff Count)
Benchmark: Guided by the cost incurred during the loss and the cost of adding an equivalent replacement. Should ideally not exceed 5% monthly.
Importance: Retaining staff that this performing and removing or replacing the ones that are not is key to managing productivity and quality. Understanding the costs of retaining or replacing high performers, with the negative impact of keeping low performers can inform incentives and performance management programs.
Alternate Terms: Staff Turnover, Staff Churn, Employee Churn