13 Appendix 6

13.1 Measuring the Projected Impact of the Proposed Interventions

The standardized coefficients found in Appendix 4 were used to calculate the ROI for improving Confidence in Direction, Alignment of Priorities, and Manager Feedback. A .5 standard deviation increase in the mean survey response scores for these three constructs is a reasonable 1-year goal.

To calculate what the ROI (or savings) would be if we meet this goal, it is assumed that the cost of one employee leaving is $10,000 (recruiting, onboarding, and lost production costs).

To calculate the impact of a .5 standard deviation increase in the three constructs, the following steps were followed:

1. Take the sum of the standardized coefficients for Confidence in Direction, Alignment of Priorities, and Manager Feedback and divide it by two.

2. Multiple this value by the standard deviation for Intent to Stay, subtract 1. This is the percent mean increase that results in Intent to Stay from a .5 standard deviation increase in the areas of focus.

13.2 Operations Turnover Savings

Only Confidence in Direction and Alignment of Priorities were used to calculate ROI for Operations as Manager Feedback was not a significant contributor.

A .5 standard deviation increase in these two constructs increases the Intent to Stay mean for Ops from 5.87 to 7.05. This moves 22 people from the leavers group (80% or more chance of leaving) to the stayers group.

22 x 10,000 = $220,000

13.3 Sales Turnover Savings

A .5 standard deviation increase in these three constructs increases the Intent to Stay mean for Sales from 6.40 to 7.48. This moves 37 people from the leavers group (80% or more chance of leaving) to the stayers group.

37 x 10,000 = $370,000

13.4 Sales Revenue Retained

Those 37 Sales Reps converted to stayers represent $3.3 million in sales revenue (beyond baseline goals) over the next year that would have otherwise walked out the door.