The Cost of the Unfilled Executive Position
“If you leave an executive position unfilled, associated with that is a significant cost.”
What is the value of an established relationship with an executive search and recruitment firm such as Key Corporate Services for current and future hiring needs? Fill in the equation to determine how much money your organization saves by hiring for the unfilled position.
Using a pre-established relationship with an executive search firm has value because it greatly decreases the time to fill open positions, and it reduces the cost of lost revenue from not having that position filled. A vacant executive position can cost your company or firm hundreds of millions of dollars across all open and unfilled hiring needs. To calculate how much an unfilled job costs you, use the following equation (this equation has been extremely simplified for illustration purposes):
Annual revenue generated by the company = Revenue per employee per year
Number of revenue generating employees ___
Revenue per employee per year = Daily revenue per employee
365 Days (not adjusted for vacation and holidays) ___
Daily revenue per employee ___ X ___ Days position unfilled = Revenue lost per day per unfilled job
Revenue lost per day ___ X ___ Number of open jobs = Total revenue lost per day for all open jobs per unfilled job
Total revenue lost per day for all open jobs can easily approach millions of dollars for an organization when using this simplified formula.