A Stitch in Time Saves Nine: Leveraging Networks to Reduce the Costs of Turnover

by Rob Cross, Gary Ballinger, Elizabeth Craig, Peter Gray


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Abstract

Increased workforce mobility imposes a significant cost on many organizations because of the negative impact departing employees have on informal networks. The turnover of well-connected employees disrupts networks important to innovation, best practice transfer, and project execution. Yet while network losses can be quite costly, they are typically invisible to most organizations’ financial and performance management systems. Using network data, this article shows how managers formulate three different kinds of strategies, namely, identifying flight risks in advance of departure, investing in key people in the network to improve retention, and improving network connectivity to enable it to be maintained in the face of turnover.

California Management Review

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Published at Berkeley Haas for more than sixty years, California Management Review seeks to share knowledge that challenges convention and shows a better way of doing business.

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