Everyone working in a company has their share of work to do which they usually struggle to finish. To top that, if there is added work from an unfilled position that is being passed to the other employees, things can get really stressful.
These unfilled positions might not seem like a big deal, but it becomes one when you compare it with the outcome. Multiple studies are proving the fact that such unfilled positions will end up costing a lot for the company.
Disguised performance destruction
The first hiccup when you start the hiring process is that it is not always a smile and quick process. The higher the turnaround time, the higher the cost for the same. Most of the time when a position needs to be filled, by the time the recruitment personnel or manager finishes their work and finds the right person for the position, there would be enough damage done.
An organization may tend to oversee a vacant position because the other members of the team are extended to cover the gap. The need for an individual to fill the seat might become an unreasonable expectation to a manager. This leads to evading the need to immediately fulfil the gap. In every organization, the team is always ready to contribute its best towards the company and they make the stretch at work look seamless and manageable. This leads to a lot of problems on the way ahead, like the team not being able to complete their tasks on time, the performance of the individual in the team goes down, the number of ad-hoc activities increase, accountability for a task is undefined, etc. This creates a huge impact on the organization as a whole in the long run. Over some time the reasons for the poor performance of the individuals would be difficult to identify that causes more trouble as it is disguised and need a thorough investigation to understand.
The disguised nature of the issue makes it very crucial point to focus and not overlook.
Quantifying lost revenue
Although a person’s job cannot quite be quantified or made tangible, there are ways to understand what that position is worth it. One way of doing this is by dividing the total revenue generated by the department by the total number of employees. This will show how much each person is responsible for creating in the team and a better understanding of an average revenue to be generated per person. This is of course assuming that everybody’s work is equally important and contributing to the revenue earned. When you find out a day’s revenue and divide it with the number of employees, you will now know how much that one vacant post you thought was irrelevant can cost you.
Of course, high paying jobs in high positions create more revenue and hence a chair vacant in a higher position is much more a loss than any other position. The reason why this is an issue that needs to be addressed is that the value of these vacant chairs is intangible. Unlike quantifying normal outcomes in a business, these are aspects that go unnoticed because people tend to assume it won’t harm the company’s revenue.
Set a limit on acceptable revenue loss
Once you realize the importance of filling that vacancy, you need to set a limit on how much revenue you can afford to lose from that position. The ideal would be zero, since filling a position is a time-consuming task, there would inevitably be some revenue lost. On a case to case basis, the organization often hires an omnichannel sourcing agency to find the right fit for the organization. Once you have calculated how much that vacancy was worth, you can also determine how much of it you can afford to miss. This will provide you with a clear-cut idea of the urgency with which that position should be filled.
You need to also know the average time your hiring team would require finding you that perfect fit.
Recruiting spend vs Cost of an open position
As soon as a position is open, you need to figure out how to proceed with it. Once you find what the loss would be from that one open position, you will be able to access the appropriate turn around time for the position. If the position has a null effect on the revenue and the performance of the fellow employees, it can be considered void. If the vacancy proves to be an essential and affects the team the hire needs to be faster and an agency can be hired to make the process faster and more efficient.
When reaching out to Placement agencies, the points you need to consider are
- Turn around time
- Internal hire VS outsourcing cost
- Nicheness of the skill
- The position needs headhunting or poaching