Context: I'm a salesperson that works for a company that has a product that helps to increase Influenced Hires, a company would want to hire more Influenced Hires because they have a 27% higher promotion rate than Non-Influenced Hires.
Based on the assumption that employees that are promoted are highly engaged employees, and studies show that highly engaged employees produce 21% more profit, I want to illustrate to clients the potential positive financial impact increasing their percentage of Influenced Hires could have on Revenue by investing in my company's product.
Some assumptions & inputs:
- Company made 55 hires in the past year, if relevant/necessary we can assume the company will make 55 hires in each of the next 3-5 years (if longer timeline is helpful to proving statement that's fine)
- Company had a 35% Influenced Hire Rate in the past year
- Median Salary at company is $100,000
- Organizational Value of each Employee is 2x their annual salary, meaning each employee is expected to generate $200,000 in Revenue
- Profit margin stays constant year over year meaning the 21% more in profit mentioned earlier can be applied to revenue
- Average promotion rate in the US is 10%
- Influenced Hires have a 27% higher promotion rate than Non-Influenced Hires
- Employees promoted are highly engaged & highly engaged employees produce 21% more profit
I've been running into issues doing the math and it showing that despite a 27% higher promotion rate, the expected number of promotions for Non-Influenced Hires comes out to be higher than the expected number of promotions for Influenced Hires.
I think that might be because I'm using the 35% Influenced Hire Rate when in order to support my claim, I'd need to be using a 50:50 split, but math is really not my strong suit so need confirmation if using a 50:50 split is ideal or not.
It could also have something to do with using too short of a timeline?
What would be the best way to model this out to support my claim?
Based on the assumption that employees that are promoted are highly engaged employees, and studies show that highly engaged employees produce 21% more profit, I want to illustrate to clients the potential positive financial impact increasing their percentage of Influenced Hires could have on Revenue by investing in my company's product.
Some assumptions & inputs:
- Company made 55 hires in the past year, if relevant/necessary we can assume the company will make 55 hires in each of the next 3-5 years (if longer timeline is helpful to proving statement that's fine)
- Company had a 35% Influenced Hire Rate in the past year
- Median Salary at company is $100,000
- Organizational Value of each Employee is 2x their annual salary, meaning each employee is expected to generate $200,000 in Revenue
- Profit margin stays constant year over year meaning the 21% more in profit mentioned earlier can be applied to revenue
- Average promotion rate in the US is 10%
- Influenced Hires have a 27% higher promotion rate than Non-Influenced Hires
- Employees promoted are highly engaged & highly engaged employees produce 21% more profit
I've been running into issues doing the math and it showing that despite a 27% higher promotion rate, the expected number of promotions for Non-Influenced Hires comes out to be higher than the expected number of promotions for Influenced Hires.
I think that might be because I'm using the 35% Influenced Hire Rate when in order to support my claim, I'd need to be using a 50:50 split, but math is really not my strong suit so need confirmation if using a 50:50 split is ideal or not.
It could also have something to do with using too short of a timeline?
What would be the best way to model this out to support my claim?