HR case interviews: attrition, workforce planning and org design

Look for concentration. If the increase is mostly first-year employees in two sites under new managers, the cause is probably onboarding or management, not company-wide pay. Exit interviews help, but compare them with what the data shows, since people leaving often give the easiest reason.

Build it from components rather than quoting a rule of thumb, since estimates vary widely by role. A fictional 2,000-person customer support organization, with illustrative costs:

Now fixes have a budget. A $1,500 retention bonus for 600 at-risk employees costs $0.9M. If it prevents half the extra exits (70 × $15,000 = $1.05M saved), it roughly pays for itself, but fixing the underlying management or onboarding issue is the durable answer.

The staffing ratio here is illustrative: real ratios vary by type of unit, and some states set minimum ratios in law. In an interview, state the ratio as an assumption and show how the answer changes if it moves.

1. 1

   Start from strategy

   What must the organization be great at? Speed, cost, customer intimacy, innovation?

2. 2

   Map the work

   Which activities, decisions and handoffs does that require?

3. 3

   Choose the structure

   Functional, divisional (by product, customer or region) or matrix, each with clear trade-offs.

4. 4

   Set spans and layers

   With 1,000 front-line employees, a span of 5 needs 200 first-line managers; a span of 8 needs 125.

5. 5

   Plan the transition

   Roles, communication, and how to keep performance steady during the change.

Check three things. External competitiveness: where pay sits against market data for the role and location (for example the 50th or 75th percentile). Internal equity: whether similar roles are paid similarly. Pay mix: base, bonus, equity and benefits. Remember that several US states and cities now require pay ranges in job postings, so pay decisions are more visible to candidates and current employees than they used to be.