You’ve probably heard statistics about the “high cost of losing a customer.” The theory is simple and true (fact?): keeping existing customers and repeat business is much more profitable than attracting new customers. Here are a few facts from BusinessCoach.com:
- For every customer who bothers to complain, there are 26 others who remain silent.
- The average “wronged” customer will tell 8 to 16 people.
- 91% of unhappy customers will never purchase services from you again.
- It costs about five times as much to attract a new customer as it costs to keep an old one.
- Each one of your customers has a circle of influence of 250 people or potential customers who hear bad things about you!
The point of this post is simple: RETAIN YOUR GOOD DEVELOPERS. Getting someone up to speed on a legacy codebase takes a long time and is an expensive undertaking. A large part of the software coach’s or manager’s job is attracting, developing and keeping talent. And that talent becomes more valuable over time.
Yes, you might be able to replace someone at a lower annual salary, but you have to take into account the complexity of your code portfolio in how long it’ll take to make that person productive. A $60K/annum employee may very well take $120K before reaching the productivity level and contribution of the developer who left the team.