People-Friction Report
See where it leaks, and what you could save.
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- The cost of turnover, absence and friction
- The formula behind each figure
- Realistic saving in year one
- Payback and return on investment
- Skills levy you can claim back
- Your report as an email and PDF
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How we calculate
Every figure comes from a formula you can check, using published research. Where the research gives a range, we take the cautious end, and we only count costs that show up in your numbers. The real cost of people-friction is almost certainly higher.
Staff turnover
Replacing someone costs recruitment, onboarding, training, overtime while the post is vacant, and lower output while the new person learns. A review of 30 case studies found a typical cost of about 20% of annual salary for roles under senior level.1
We apply 20% to everyone, including leaders, whose real replacement cost is usually far higher.
Absenteeism
An absent worker's day costs more than their wage, because the team around them slows down or works overtime. Research across many occupations found the median cost of an absence is 1.28 times the daily wage, and higher in team-based, time-sensitive work like production lines.2
Daily cost = monthly cost ÷ 21.67 working days. We use the median, not the higher factory multiplier.
Leadership friction
When leaders don't work as one team, their hours go to conflict, firefighting and fixing misunderstandings. A global workplace study found employees spend an average of 2.1 hours a week dealing with conflict.3
We count leaders only, not the whole workforce. Hourly cost = annual cost ÷ 2,070 working hours (46 weeks × 45 hours).
What the savings assume
- Conservative: 10% fewer leavers, 5% fewer absence days, 15% fewer leader hours lost to friction.
- Expected: 20% fewer leavers, 10% fewer absence days, 30% fewer leader hours lost.
- Both are deliberately modest. A meta-analysis of 335 leadership-training studies found clear improvements in leaders' behaviour and in organisational results. The strongest effects came from programmes for frontline leaders, delivered on site over several sessions with practice.6 That is how the Programme is designed.
What we leave out (on purpose)
- Lost output from people who are present but disengaged. Gallup finds only 18% of South African employees are engaged,4 but no one can price that reliably for your plant.
- Quality, rework, safety incidents and missed deliveries linked to poor communication.
- The higher replacement cost of managers and skilled artisans.
- Your own time as MD spent resolving people issues.
- Boushey, H. & Glynn, S. J. (2012). There Are Significant Business Costs to Replacing Employees. Center for American Progress.
- Nicholson, S., Pauly, M. V. et al. (2006). Measuring the effects of work loss on productivity with team production. Health Economics (2006); NBER Working Paper 10632. Summary: Knowledge at Wharton.
- CPP Inc. (2008). Global Human Capital Report on workplace conflict. Summary: EHS Today.
- Gallup (2026). State of the Global Workplace: South Africa.
- Skills Development Levy, WSP and SETA mandatory grants (20% of levy paid).
- Lacerenza, C. N. et al. (2017). Leadership training design, delivery, and implementation: A meta-analysis. Journal of Applied Psychology, 102(12), 1686–1718.