Recovery Lag

Definition

Recovery Lag measures the average time (in months) between when an employee leaves and when their replacement reaches the same capacity level.

Why It Matters

• True cost of attrition: Understaffing period is longer than "time to hire"
• Capacity forecasting: Know when you'll return to full strength
• Hiring urgency: Longer lag = need to hire further in advance
• Revenue impact: Each month of lag = lost revenue opportunity

Formula

Recovery Lag = Average time from (Departure Date → Replacement reaches Departed Employee's Capacity Level)

Components:

1. Vacancy period: Time from departure → backfill start date
2. Ramp period: Time from backfill start → backfill reaches departed capacity level

Why It's Not Just "Time to Hire"

Time to Hire: Measures how long it takes to fill a vacancy (usually 1-3 months)

Recovery Lag: Measures how long it takes to restore lost capacity (usually 4-7 months)

Example

Employee leaves: March 1 (was at 100% capacity)
Backfill hired: May 1 (2-month time-to-hire)
Backfill reaches 100%: September 1 (5-month ramp)
───────────────────────────────────────────────────
Recovery Lag: 6 months (March → September)
Time to Hire: 2 months (March → May)

The organization lost 6 months of productivity, not 2.

Worked Example 1: Fully Ramped Employee Leaves

Scenario:

• Sarah leaves July 1 at 100% capacity ($1.2M annual quota)
• Backfill starts September 1 (2-month vacancy)
• Backfill ramp schedule: 0% → 25% → 50% → 75% → 100%

Timeline:

July:      0% (vacant)
August:    0% (vacant)
September: 0% (month 1 of ramp)
October:   25%
November:  50%
December:  75%
January:   100% ← RECOVERED
───────────────────────────────
Recovery Lag: 6 months

Worked Example 2: Partially Ramped Employee Leaves

Scenario:

• Jason leaves March 1 at 50% capacity (was 6 months into ramp)
• Backfill starts May 1 (2-month vacancy)
• Backfill ramp schedule: 0% → 25% → 50% → 75% → 100%

Timeline:

March:   0% (vacant)
April:   0% (vacant)
May:     0% (month 1 of ramp)
June:    25%
July:    50% ← RECOVERED to Jason's level
───────────────────────────────
Recovery Lag: 4 months

Key insight: Recovery lag is shorter when a partially ramped employee leaves, because you only need to restore to their capacity level (50%), not full capacity (100%).

Calculating Average Recovery Lag

For multiple departures:

Average Recovery Lag = Σ (Individual Recovery Lags) / Number of Departures

Example: North America East Q4 2025

Employee	Departed	Capacity Lost	Backfill Start	Capacity Restored	Recovery Lag
Tom	Sept 30	100%	Nov 30	April 1	6 months
John	Oct 15	100%	Dec 15	May 1	7 months
Sarah	Nov 1	50%	Jan 1	March 1	4 months
Mike	Nov 15	75%	Jan 15	April 15	5 months
Lisa	Dec 1	100%	Feb 1	July 1	7 months

Average Recovery Lag = (6 + 7 + 4 + 5 + 7) / 5 = 5.8 months

For demo simplification: 4.5 months average

Factors That Increase Recovery Lag

1. Longer Time-to-Hire

• Slow recruiting process
• Hard-to-fill roles
• Delayed backfill approvals

2. Longer Ramp Time

• Complex products
• Large territories to learn
• Inadequate onboarding

3. Senior Departures

• Losing a top performer (120% capacity)
• Takes longer for replacement to reach that level

4. No Backfill

• Position left vacant
• Recovery lag = ∞ (never recovered)

Impact on Capacity

Revenue Loss During Lag

Employee Annual Quota: $1.2M
Monthly Quota: $100K
Recovery Lag: 6 months
Lost Revenue Opportunity: $100K × 6 = $600K

For a team with 45% attrition and 5 departures:

5 employees × $600K each = $3.0M lost revenue opportunity

This is on top of replacement costs (recruiting, training, ramp).

Compound Effect

With ongoing attrition, recovery lags overlap:

Month 1: Employee A leaves (6-month lag starts)
Month 2: Employee B leaves (6-month lag starts)
Month 3: Employee C leaves (6-month lag starts)
───────────────────────────────────────────────
You're ALWAYS carrying 3+ positions below full capacity

How to Reduce Recovery Lag

1. Reduce Vacancy Time

• Pre-approved backfill budgets
• Evergreen recruiting pipelines
• Faster offer-to-accept process
• Competitive compensation

Impact: Cut 2-month vacancy to 1 month = 1-month shorter lag

2. Accelerate Ramp

• Better onboarding programs
• Manager shadowing
• Deal mentorship
• Territory warm-handoffs

Impact: Cut 5-month ramp to 4 months = 1-month shorter lag

3. Hire Experienced Reps

• Industry veterans ramp faster
• Comp trade-off: Higher salary vs faster productivity

Impact: Cut ramp from 5 months to 3 months = 2-month shorter lag

4. Backfill Immediately

• Don't wait for "headcount planning cycle"
• Automatic backfill approval for attrition
• Hire ahead of attrition (buffer capacity)

Impact: Start hiring before departure = 0-month vacancy

Best Practices

1. Track by Cohort

• First 90-day quits: Different pattern than veteran departures
• Top performers: Longer recovery lag (hard to replace)
• Performance terminations: Shorter lag (were underperforming)

2. Set Targets

• Vacancy period target: < 60 days
• Ramp to 100% target: < 120 days
• Total recovery lag target: < 180 days (6 months)

3. Monitor Trends

• Is lag increasing? (Recruiting slowing down? Onboarding degrading?)
• Seasonal patterns? (Q1 hires ramp faster than Q4?)

4. Report to Leadership

"We lost 5 people in Q4. Our average recovery lag is 5.8 months, meaning we'll operate below target capacity until May."

This makes the problem tangible and urgent.

Common Pitfalls

• Confusing with time-to-hire: Recovery lag is always longer
• Not tracking partial ramp departures: They have shorter lags, bringing down your average
• Ignoring backfill quality: Hiring a poor performer = recovery lag approaches ∞
• Not accounting for re-attrition: If backfill leaves during ramp, lag resets

Relationship to Other Metrics

Metric	Relationship
Attrition Rate	Higher attrition = more positions in recovery lag
Time to Backfill	Component of recovery lag (vacancy period)
Ramp Time	Component of recovery lag (onboarding period)
Unrecovered Gap	Current capacity deficit from ongoing recovery lags
Backfill Rate	% of positions actually backfilled (vs left vacant)

Related Terms

• Attrition Rate - How much capacity you're losing
• Time to Backfill - Vacancy period component
• Backfill Rate - Whether positions get filled
• Unrecovered Gap - Current capacity shortfall
• Backfill Planning - How to minimize recovery lag

References

• Also called: Time to full productivity, capacity restoration time
• Standard metric in enterprise sales capacity planning
• Critical input to workforce planning models