I asked ChatGPT two questions yesterday: (1) How much do American companies spend on recruiting and training each year? and (2) How much do American companies spend on offboarding long-time employees annually? The answers were very telling.
GPT had all kinds of answers to question (1). U.S. companies spend $100-120 billion annually on recruiting and $98 billion on training. The average onboarding cost of a new employee ranges from $7,500 – $28,000. When it came to question (2), AI was flummoxed. It cited Golden Parachute packages for CEOs in the tens of millions of dollars and it talked in platitudes about how important it is to take care of employees, but there was no hard data. We throw weddings, but not divorce parties. Humans have a fraught relationship with exits.
As Rishad Tobaccowala writes in this Substack post:
“Elegant exits particularly at senior levels are unfortunately too rare, leaving both the individual and the company diminished. The individual loses since a career transition not handled well can stain a reputation and leave a residue of ill will towards an institution where many years of one’s life has been dedicated. The company loses because instead of having advocates among an influential diaspora of senior talent one may end up with hecklers and detractors. Also, senior colleagues and direct reports of the departed employee can feel less loyal to the company. It behooves both the individual and the firm to anticipate, plan and manage for the midnight hour whenever possible.”
We could do this so much better and MEA is being enlisted to help. There are all kinds of well-known global consulting firms that require their partners to retire at 60 or 62. Imagine a program that helps them curate and share their wisdom during the last couple of years of their employment while also developing an exciting next step in their career, since so few knowledge workers want to truly retire before their 70s. Then, the company can have a set of alumni who are the ultimate recruiting machine. Spending more money on exits might mean the company has to spend less money on recruiting.
In January, MEA hosted an Airbnb alumni private retreat at our Baja campus with three dozen of my former early employees (and a couple of current ones) that was full of collective effervescence and wisdom-sharing. It was an inspired week and reinforced my belief that there’s so much value in tapping into former employees.
Fortunately, MEA has been approached by three of the best-known global consulting firms with mandatory retirement and has already created a beta test at our Santa Fe campus with one of them. We’ve also been approached by one of the major professional sports leagues to assist their retiring players and we’re developing a program with a U.S. state so they can create a “Reframing Retirement” program for their long-time municipal workers.
The time has come for organizations to see that Exits are as important as Entrances. This is part of the reason my MEA partner Kari Cardinale made the recent decision to open MEA’s online doors for free to U.S. federal employees who were recently furloughed with a chainsaw. They weren’t provided a respectful exit. Since announcing the free scholarships a few weeks ago, we’ve had folks from 20 different departments including: USAID, NIH, Departments of Education, Defense, Health, Social Security, EPA, and CDC apply for them to join our programs. You can read more about it in Kari’s recent blog post.
If you’re curious about learning more about these MEA’s programs, feel free to email Kari at [email protected] or click this link if you’re a government worker who’s lost their job.. And, for those of you who want to learn more about Reframing Retirement online bootcamp June 23-27, check out the website.
-Chip