Hi apl,

The point of view of the Pointy-haired Management is very limited in the sense that they are only considering the $cost_differential instead of the total cost that would include among other things:

• the cost differential,
• the cost of acquiring a new employee,
• the cost of training the new employee,
• the cost paid to integrate the new employee,
• the cost of excess overtime payment to compensate the temporary performance downfall,
• the cost of loss of production or loss of customers, and
• the monetary value of loss of morale of remaining employees.

I guess that this lack of vision is what causes so many businesses to fail

Cheers,

Hi lin0. You raise a lot of excellent points, all usually ignored by Pointy-Haired Management. Perhaps now is the time to mention The Mythical Man-Month?