Strategies to Improve Voluntary Attrition 2nd EditionRate
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STRATEGIES TO IMPROVE VOLUNTARY ATTRITION RATE
Project submitted to Karnataka State Open University in partial
fulfillment for the award of MASTER OF BUSINESS ADMINISTRATION
IN HUMAN RESOURCE MANAGEMENT
By:
Saurabh Sankar Sengupta
Reg: 111262MBA0028
Under the guidance of
Dr. Dhirendra Joshi
Department of Management
KARNATAKA STATE OPEN UNIVERSITY
MYSORE
JANUARY 2014
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The Project may contain the following information
CERTIFICATE
This is to certify that the STRATEGIES TO IMPROVEVOLUNTARY
TTRITION RATEIs a bonafide record of independent research work done
by MR.Saurabh Sankar Sengupta(Reg: 111262MBA0028) under
my(Dhirendra Joshi) supervision, submittedto Karnataka State Open
University in partial fulfillment for the award of the MASTER OF BUSINESS
DMINISTRATION IN HUMAN RESOURCE MANAGEMENTand that the
project has not previously formed the basis for the award of any other degree,
Diploma, Associate ship, Fellowship or other title.
Signature of the Supervisor
DECLARATION
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I Saurabh Sankar Sengupta hereby declare that the dissertation
entitled STRATEGIES TO IMPROVEVOLUNTARY ATTRITION
RATEsubmitted toKarnataka State Open Universityin partial fulfillment for
the award of the MASTER OF BUSINESS ADMINISTRATION IN HUMAN
RESOURCE MANAGEMENT and that the project has not previously formed the
basis for the award of any other degree, Diploma, Associate ship, Fellowship or other
title.
Place:
Date: Signature of the candidate
FORMAT FOR EVALUATION OF PROJECT
1. Name of the Candidate : Saurabh Sankar Sengupta
2. Registration Number : 111262MBA0028
3. Name of the subject : Master of Business Administration in Human
Resource Management
4. Name of the Study Centre and Code : IT.COM College, AGRA , KSOU/AUT/394
5. Title of the Project : Strategies to Improve Voluntary Attrition Rate
Evaluation for DissertationMaximum 100 Marks
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Awarded
6.
7. Name and Address of the supervisor: (With Seal)
(Supervisor)
CONTENTS
Student Declaration
Acknowledgement
Preface
Page No.
F Chapter I 8 -12
Introduction
Need of study
Objective of Study
Methodology
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Scope of study
Limitation of study
Chapter Arrangement
F Chapter II 13 -56
F Discussion
F Chapter III 56 - 61
Findings
Suggestions & Recommendation `
Conclusion
F Bibliography 62
PREFACE
As the part of the M.B.A curriculum I have made my winter project on attrition rate.The topic of my project is Strategies to improve voluntary attrition rate
This project provide me with an opportunity to understand what in an attrition rate
,why do employees leaves voluntary and various strategies to improve voluntary
attrition rate in any organization which help to enriched the environment of
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organization by satisfying employees and help them to achieve maximum growth and
development.
Voluntary attrition is more common in BPOs today. By the project I came to know
about what is the attrition rate in Indian BPOs, with strategies how we overcome by
this problem. Also the project gives an idea about affect of recession on attrition rate
in BPOs.
(Saurabh Sankar Sengupta)
CHAPTER I
INTRODUCTION
The old adage people are your most important asset is wrong. The right
eople are your most important asset. -Jim Collins.
HRM is concerned with the development of human resources, i.e., knowledge,
capability, skill, potentialities and attaining and achieving employee goals, including
ob satisfaction. It has been viewed that human resource occupies a central role in an
organization and there is no limit to the potential of an organization that recruits
good people, raises them up and continually develops them. Of late, it is widelyaccepted that human resource builds the distinctive competitive advantage of an
organization. It is particularly true in case of service- oriented industries like
software, pharmaceutical, and biotechnology etc. The success of these firms mostly
depends on people- embodied know-how that includes skills and abilities
embedded in an organizations workforce.
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Attrition rate is the rate by which employees leave from the organisation. There are
some employees that voluntary leaves the organisation as they do not find
organisation system according to them etc and other types of employees whom
organisation do not found according to it. There are various reasons why the
employees leave the organisation and how effective the organisation is to overcome
the high attrition rate strategically.
Fundamental changes are taking place in the work force and the workplace that
promise to radically alter the way companies relate to their employees. Hiring and
retaining good employees have become the chief concerns of nearly every company in
every industry. Companies that understand what their employees want and need inthe workplace and make a strategic decision to proactively fulfill those needs will
become the dominant players in their respective markets.
NEED OF THE STUDY
Todays most of the organizations facing the problem of Attrition, so this encouragedme to study this topic which will help find solution to the problem that arouse
because of attrition.
OBJECTIVE OF THE STUDY
The objectives of this study were to:
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METHODOLOGY FOLLOWED
There are two types of data that can be collected i.e., Primary Data and Secondary
Data.
Secondary data was collected through:
SCOPE OF THE STUDY
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LIMITATION OF THE STUDY
CHAPTER ARRANGEMENT
CHAPTER-I
This chapter of the project report includes the introduction, objective, scope,methodology, and limitation of the study.
CHAPTER-II
This chapter deals with the discussion of the subject and concept of Attrition rate in
BPOs.
CHAPTER-III
Findings, suggestion and recommendations and final conclusion are given in chapter
3.
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CHAPTER II
TTRITION
Companies are facing different problems to sustain their business in the market and
one of the most important HR problems that companies are coming across
is attrition or turnover.In a broad sense,Attrition refers to the movement
of workforce into and out ofan organization. It implies reduction in the
number of employees through retirement,resignation or death. This
movement is an index of stability of that workforce. Attrition is a universal
phenomenon and no industry is devoid of it, but the degree fluctuates from industryto industry.Attrition not only affects the quality of service, but also leads to
increased expenditure on training and development, thereby affecting
the overall organizational performance.An excessive movement of employees
is therefore considered undesirable and expensive. Labour market assumes immense
importance in the context of software industry on account of acute global shortage of
skilled software professionals in India as well as abroad. On account of availability oflarge number of jobs in the market, the extrinsic satisfaction perceived by these
professionals is less which leads to high turnover. Companies are finding it difficult
to satisfy and retain the employees who are the contributors to their top line and
bottom line. This problem has further intensified because of workforce diversity
where companies have to devise different strategies for different types of employees.
To combat this problem innovative practices are used by companies to satisfyemployees and improve retention. Companies are trying out their ways to manage
lower rate of attrition by creating a healthy work environment, work-life balance,
corporate brand building and so on. The need of the time is to have properly
harnessed and devoted team of employees.
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An understanding of work and human behavior based on experiential and empirical
evidences point out, that the human system is not static. It is being continuously
influenced by the ever changing subsystems in the environment. Managing attrition
should thus be viewed as a dynamic process which needs to be kept aligned with the
changing realities in the environment. The nature of work, workplace and
psychological environment in organizations have undergone and will continue to
undergo enormous changes, bringing both opportunities and challenges to those
involved in organizational behavior and organizational development.
Global outsourcing and the astounding amount of foreign direct investment pouring
into India has created tremendous opportunities and competition for talented ITprofessionals. The downside of this increased competition is a rising rate of attrition,
particularly in India. The costs incurred in recruitment, training and orientation are
suddenly lost when the employee decides to move. Greater appreciation of the
significance of these costs has stimulated considerable managerial interest in the
problem of attrition. Several companies are trying out different ways to manage
attrition rate but it is a costly dilemma for all organizations. In todays taxingbusiness climate, managing companys competent and skilled human capital is vital
for success. The exodus of employees working in Software industry is much faster
than any other conventional industry. This exodus can be voluntary or
involuntary in nature.
TTRITION RATE
"The rate of shrinkage in size or number of employees is the attrition
rate"
An attrition rate, measure of how many employees leave over a certain period of
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time. The attrition rate has always been a sensitive issue for all organizations.
Calculating employee turnover rate is not that simple as it seems to be. No common
formula can be used by all the organizations. A formula had to be devised keeping in
view the nature of the business and different job functions. Moreover, calculating
attrition rate is not only about devising a mathematical formula. It also has to take
into account the root of the problem by going back to the hiring stage.
There is no standard formula to calculate the attrition rate of a company. This is
because of certain factors as:
The employee base changes each month. So if a company has 1,000 employees inApril 2004 and 2,000 in March 2005, then they may take their base as 2,000 or as
1,500 (average for the year). If the number of employees who left is 300, then the
attrition figure could be 15 percent or 20 percent depending on what base you take.
Besides this, there are various other types of attrition that should be taken into
account while calculating attrition rate. These are:
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CALCULATING RATE OF ATTRITION
Organizations use different methodologies for calculating their turnover rate. It is a
known fact that attrition rate calculation is a grey area which does not always depict
the true picture. While a few techniques are common, there are no proven theories.
Further, the approach to this calculation might vary from organization to
organization. Disclosure of the figure not only has a direct impact on the business but
also affects employee morale and productivity. Significantly, it might also trigger a
chain reactiona high attrition rate will lead to more people leaving the
organisation, while a lower rate will act as a retention strategy. It is therefore not
surprising that most industry observers are sceptical when organisations disclosetheir employee turnover.
Step 1. Calculate the average number of employeesThe number of employees
is calculated by adding the number at the start of the period, to the number at the
end of the period. Then dividing by 2 to arrive at the average number of employees.
For example: At the start of the year the firm employed 1000 people. At the end of
the year the firm employed 1200. To arrive at the average we add together 1000 +
1200 = 2200. Then divide by 2 to get our answer 2200/2 = 1100. This figure is the
average number of people employed during the period.
Step 2. Calculate the number of departures during the periodThe key hereis to make sure that we only include those departures that are actually relevant. That
means those that come within the definition we are using. So for the definitions we
are using in this example the relevant figures are: Total number of exits = 220
Voluntary = 110 Early = 55
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Step 3. Divide departures by number of employeesTo arrive at our final
figures, we divide the number of relevant departures by the average number of
employees. Then multiply by 100 to get the percentage rate. For total turnover we
have: 220 / 1100 (x 100) = 20% for voluntary turnover we have: 110/1100 (x100) =
10% for early turnover we have: 55/1100 (x100) = 5% Calculating Employee
Turnover.
Calculating employee turnover is not a matter of simple mathematical methods. It is
necessary to take into account the root of the problem by going back to the hiring
stage.
TTRITION COSTS
One of the best methods for calculating the cost of turnover takes into account
expenses involved to replace an employee leaving an organization. These expenses
are:
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C. Administration cost:
They include:
TYPES OF ATTRITION
OLUNTARY ATTRITION
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oluntary Attritionis a decision made by the employee to leave the job. Such a
decision is commonly known as "resignation," "quitting," "leavingor
givingnotice."
Some common reasons for voluntary termination include:
Depending on the employee's reason, comfort with the employer, and dedication to
the job, voluntary termination may be sudden and abrupt without warning to the
employer, or with a certain amount of notice given. Generally, employers prefer that
a departing employee provide at least some notice to the employer, often at least two
weeks, this often called aTwo weeks notice. Those in compliance with this
requirement are more likely to be rehired by the same employer in the future, to
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receive their full benefits from the employer, and to get a better reference for future
employers.
Annualized voluntary attrition measured by number of voluntary leavers as a
percentage of the total employee population. There will always be a natural level of
voluntary attrition due to people retiring, decisions to change careers and a
competitive marketplace.
Companies are generally more concerned about regretted voluntary attrition. These
are people who leave on their own will and those whom the organization would have
loved to retain.
Organizations aim to reduce voluntary attrition of productive employees and
encourage unproductive staff to leave its fold. It makes way for career progression,
new thinking and innovation. However, what that number should be again differs
from industry to industry and from country to country as economies vary. The
demand vs. supply of talent/resources plays a critical role too.
Involuntary Attrition
Involuntary Attritionis the employee's departure at the hands of the employer.
There are two basic types of involuntary termination, known often as being "fired"
and "laid off." To be fired, as opposed to being laid off, is generally thought of to bethe employee's fault, and therefore is considered in most cases to be dishonorable
and a sign of failure. Often, it may hinder the new job-seeker's chances of finding
new employment, particularly if he/she has been fired from earlier jobs. Job-seekers
sometimes do not mention jobs which they were fired from on their rsums.
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Dismissalis the employer's choice to let the employee leave, generally for a reason
which is the fault of the employee. The most common colloquial term for dismissal in
America is being fired whereas in Britain the term 'getting the sack' is used.
Layoff:A less severe form of involuntary termination is often referred to as a layoff.
A layoff is usually not strictly related to personal performance, but instead due to
economic cycles or the company's need to restructure itself, the firm itself is going
out of business, or due to a change in the function of the employer (for example, a
certain type of product or service is no longer offered by the company, and therefore
obs related to that product or service are no longer needed). One type of layoff is theaggressive layoff. In such a situation, the employee is laid off for a just cause, but not
replaced as the job is eliminated.
Often, layoffs occur as a result of "downsizing", "reduction in force" or "redundancy".
These are not technically classified as firings laid-off employees jobs are terminated
and not re-filled, because either the company wishes to reduce its size or operations,or otherwise lacks the economic stability to retain the position.
Some companies resort to attritionas a means to reduce their workforce. Under
such a plan, no employees are forced to leave their jobs. Employees are given the
option to resign in exchange for a fixed amount of money, frequently a few years of
their salary.
REASONS RESPONSIBLE FOR VOLUNTARY ATTRITION
The most common reasons can be:
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HR should continually train managers in handling employee expectations and
provide them with tools to manage tasks related to their teams. An online Manager
Services solution allows a manager to constantly counsel employees, manage their
career growth and aspirations and track their achievements.
HR should also be able to track changes in employee performance rating, gaps
between employee and manager performance, sudden increase in paid-time-off and
should be prepared to act quickly if any visible trends are evident.
The responsibility for compensation policy and enriching the job profile lies on the
senior management. However, balancing P&L and employee compensation shall
always be a nightmare for them given the high cost of talented employees.
When all employees work on goals that are aligned to the company objectives and
there is a fair and transparent system to capture employee performance, the
likelihood of a satisfied and motivated workforce increases and Compensation or Job
Profile become manageable causes.
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STRATEGIES ADOPTED TO COMBAT VOLUNTARY ATTRITION
The focus of organizations should not be on managing retention but on managing
people. If an organization manages people well, employee attritionwill come down
itself. Organizations should emphasize on managing the work environment to makebetter use of the available human assets. Companies are aiming to provide a
pragmatic and lithe framework for the efficient management of knowledge workers
in the volatile economy. People want to work for an organization which provides,
Appreciation for the work done, Ample opportunities to grow, A friendly and
cooperative environment The most successful companies have been using most
innovative practices in managing the problem of attrition. Reducing turnover takesan investment in coaching, developing, motivating, mentoring & listening to people.
There should be universal acceptance of the goal of reducing turnover along with top
management commitment and dedication. These companies are stepping up their
attention to employee quality-of-life issues. The tools used by Indian companies to
combat attrition are as:
Flexi hours:
Flexible hour options used by companies provide benefits to both employee and
employer. The flexible options offered by an employer will depend on the type of
business they are running. Implementing an option of flexible hours invariably
means providing alternatives to the standard 9 to 5, 5 days per week model. The mostcommon options for non-standard or flexible hours arrangements are: Flexi- time,
Part-time working, Job sharing, Annualized hours, Compressed working hours, Shift
work, Staggered hours, Term- time working, Voluntary reduced working hour or V-
time, Time accounts/ flexi- days
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For the employee the major benefits include:
For the employer the major benefits include:
From employers perspective some of the major issues involved are trust and
supervision, communication between staff working at varying times, optimizing the
use of buildings and facilities, integrating part-time, non- permanent and home
working staff, achieving fairness in benefits for all staff Flexi-timing helps in
balancing work and personal life during any crucial phase.
For Instance- When Rajashree Natarajan Director (Process and Quality group),
Cognizant, was offered a flexible work hours option after she delivered her second
child she readily went for it.
ppropriate leadership:
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Appropriate leadership drives people to go extra mile and deliver beyond set targets.
An emotional pull can inspire excellence even from otherwise mediocre performers.
Such attachment sensitizes workers to the need for continuous betterment and
reaching beyond the ordinary. They find themselves effortlessly putting in those
extra hours and actually enjoying it. This also keeps the workers charged upcontinuously. An effective leader connects with the subordinates. Such a manager
knows exactly when he needs to give them that little pat on the back and when he
needs to be firm. This perfect balance stems from a deep understanding of what
makes each individual in his team tick, allowing the leader to accordingly tailor his
approach to each of his employee and optimize performance. Though the current
environment presents enough opportunities for people with relevant skill sets andenough manpower for organizations to choose from, the turnover without doubt
bleeds value out of an IT organization, both in terms of time and money. The only
key to solving this problem is to improve the leadership abilities of IT managers, to
learn how to manage differences in thinking of employees and aligning employee
talents to work roles.
An organization, by focusing on the above, can save up to 25 percent of its annual
revenues, which it loses as a result of attrition.
Contract work or temping:
Job contracts- IT companies are offering job contracts that bar employees fromoining rivals vendors or partners .several IT players use these bonds. T.V Mohandas
Pai,director HR,Infosys says, Infosys does not have a generic bond in place
preventing techies from moving to competitors the existing version bars employees
from working on projects of its clients at another company for a period of six months
Perhaps HR consultants and legal experts say that there are ways around these
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stumbling blocks if someone is really keen to change jobs these bonds are legally not
enforceable, companies use these measures only to try and scare or intimidate
employees and to try to keep their
attrition rates low.
ppropriate HR professionals:
Desikamani.Gis Chief Mentor of Mentor Consulting, Chennai. E-mail:
[email protected], one of the main reasons why employees leave
companies is because of problems with their managers. An HR professional can betermed an employees advocate and a bridge between top management and
employees at all levels. There is often a huge gap between HR professionals and
employees in terms of understanding challenges and delivering requirements. HR
sometimes does not really understand the problems associated with employees
careers and jobs. The companys overall plans and strategies also depend on HR
professionals as they voice employees problems and requirements. The HRdepartment should have genuine interest in the employees welfare it is responsible
for making sure that their expectations are met. By doing this it is easier to meet the
companys business targets.
Quality of work life:
The success of any organization depends on how it attracts, recruits, motivates, and
retains its workforce. Organizations need to be more flexible so that they develop
their talented workforce and gain their commitment. Thus, organizations are
required to retain employees by addressing their work life issues.
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The elements that are relevant to an individuals quality of work life include the task,
the physical work environment, social environment within the organization,
administrative system and relationship between life on and off the job.
The basic objectives of a QWL program are improved working conditions for theemployee and increase organizational effectiveness.
Providing quality work life involves taking care of the following aspects:
Suitable working time: Organizations are offering flexible work options
to their employees wherein employees enjoy flexi-timings for dedicatingtheir efforts at work.
QWL consists of opportunities for active involvement in group working
arrangements or problem solving that are of mutual benefit to employees or
employers, based on labor management cooperation. People also conceive of QWL as
a set of methods, such as autonomous work groups, job enrichment, and high-
involvement aimed at boosting the satisfaction and productivity of workers. Itrequires employee commitment to the organization and an environment in which
this commitment can flourish.
Providing quality at work not only reduces attrition but also helps in reduced
absenteeism and improved job satisfaction. Not only does QWL contribute to a
company's ability to recruit quality people, but also it enhances a company'scompetitiveness. Common beliefs support the contention that QWL will positively
nurture amore flexible, loyal, and motivated workforce, which are essential in
determining the company's competitiveness
Exit interviews and satisfaction surveys:
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Exit surveys & Exit Interviewsare a highly effective way for business owners and
managers to learn firsthand from those who have chosen to work elsewhere just
exactly what the organization could have done better that may have increased the
chances of retaining the employee. By tracking the factors that influence an employee
to leave, employers can take the necessary steps to improve organizational processesto minimize future loss of key employees.
Exit surveys & Exit Interviews are an excellent way to attract and retain the best of
the bestand a necessary tool to help decrease the loss of valuable human capital
within an organization.
Top Five Benefits to Employee Exit Surveys and Exit Interviews
Developing a positive or conducive organization culture (identifying
office jerks and sanities offices from resident jerks)
The rapid globalization of business means that managers are increasingly working
with people from different cultures and backgrounds as colleagues, managers or as
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clients. As a result, organizations are often keenly aware that cultural differences and
culture building needs to be understood and appreciated if the potential benefits of
national and international working are to realized. Satyam for instance, has its own
commandments for employees called the satyam way. These are the guidelines that
list out the practices, behavior and conduct that the organization encourages anddiscourages. Every month, Infogain organizes soft skills workshops and sessions for
stress and conflict management. If a company fosters a supportive, inclusive work
environment, it will increase its talent pool, tap and attract high quality talent and
retain people with a progressive set of values.
Providing new perks to women workforce:
Industry requirements have also evolved over time, prompting IT companies to
devise innovative strategies to retain women. The IT industry in India is trying to
charm and catch the fancy of women workers which includes flexi-hours to provide
work life balance, sabbaticals and most important career growth. Companies have
realized the fact that gender diversity is a key to creating a culture of innovationwithin an organization. realizing that women have to manage both home and work
and need to judiciously juggle the time different companies have come up with
strategies like:
ccenture: incentives include cash for referring women
IBM: breaks to meet family commitments
Infosys: flexi work hours, satellite office for pregnant women and young mothers
Sapient: spouse referral programme, work from home
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Microsoft:flexi work hours, child-centric events
HP: self defence classes, mentoring programmes and flexible work hours
Perot: work from home long leave, shorter work leaves
Transparent Work Culture:
In todays fast paced business environments where employees are constantly striving
to achieve business goals under time restrictions open minded and transparent work
culture plays a vital role in employee retentionMore and more companies have now
realized the importance of a healthy work culture and have a gamut of people
management good practices for employees to have that ideal fresh work-life. Closed
doors work culture can serve as a deterrent to communication and trust within
employees which are potential causes for work-related apathy and frenzy.
A transparent work environment can serve as one of the primary triggers to facilitate
accountability, trust, communication, responsibility, pride and so on. It is believed
that in a transparent work culture employees rigorously communicate with their
peers and exchange ideas and thoughts before they are finally matured in to full-
blown concepts. It induces responsibility among employees and accountability
towards other peers, which gradually builds up trust and pride. More importantly,
transparency in work environment discourages work-politics which often hinders
company goals as employees start to advance their personal objectives at the expense
of development of the company as a single entity.
Employees comprise the most vital assets of the company. In a work place where
employees are not able to use their full potential and not heard and valued, they are
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likely to leave because of stress and frustration. In a transparent environment while
employees get a sense of achievement and belongingness from a healthy work
environment, the company is benefited with a stronger, reliable work-force
harboring bright new ideas for its growth.
Retention bonus:
Higher attrition rates within a particular industry have forced companies to use some
innovative strategies to retain employees. Retention Bonus is one of the important
tools that are being used to retain employees. Retention bonus is an incentive paid to
an employee to retain them through a critical business cycle. Retention bonuses are
becoming more common in the corporate world because companies are going
through more transitions like mergers and acquisitions. They need to give key people
an attractive incentive to stay on through these transitions to ensure productivity
Retention bonuses have proven to be a useful tool in persuading employees to stay.
A retention bonus plan is not a panacea. According to a survey, non-management
employees generally receive about 10 percent of their annual salaries in bonuses,
while management and top-level supervisors earn an additional 50 percent of their
annual salaries. While bonuses based on salary percentages are the generally used,
some companies choose to pay a flat figure. In some companies, bonuses range from
25 percent to 50 percent of annual salary, depending on position, tenure and other
factors. Employees are chosen for retention bonuses based on their contributions to
management and the generation of revenue. Retention bonuses are generally vary
from position to position and are paid in one lump sum at the time of termination.
However, some companies pay in installments as on when the business cycle
completes. A retention period can run somewhere between six months to three years.
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It can also run for a particular project. A project has its own life span. As long as the
project gets completed, the employees who have worked hard on it are entitled to
receive the retention bonus. For example, the implementation of a system may take
18 months, so a retention bonus will be offered after 20 months.
Although retention bonuses are becoming more common everywhere, some
industries are more likely than others to offer them. Retail/wholesale companies are
the most appropriate to implement stay-pay bonuses, followed by financial service
providers and manufacturing firms. Companies of all sizes use retention bonus plans
to keep knowledge employees retained in the company. To retain its key senior
employees post merger with EDS Corporation, Mphasis is providing cash componentbased retention bonus plan for its employees. This is mainly to retain good
employees and provide them a cash incentive to keep them motivated.
Impounding the educational certificates and the passport of the
employees:
In an attempt to tackle the problem of high attrition levels prevalent in this sector,
some of the employers are impounding the educational certificates and the passport
of the employees. Employees generally complain for such negative practice of holding
employees in the organisation.Creating opportunities to work abroad, Indian
software companies are seeking to counter this problem by creating opportunities for
young software engineers to work abroad, and by wooing middle-aged technicalmanagers who may want to return to India to raise their children. Nevertheless, this
brain drain is so severe that several of the firms .
The purpose of this service was to help employees chose their life partners within
Wipro in the hope that if employees picked spouses from the same company, they
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could spend more time together, say while traveling/dining etc. thereby improving
the work-life balance.
Employee engagement has become the need of the hour in most
organizations today.
An organisation cannot grow without the commitment and engagement of its
employees. Employee engagement is the level of commitment and involvement an
employee has towards the organisation and its values. An engaged employee is aware
of business needs, and works as a team to get the job done. It shows the positive
attitude of the employees towards the organisation and its values.
Engaged employees are more willing to put in extra effort when the organisation
needs it. Employee engagement is thus a partnership between a company and its
employees where everyone works together to achieve the business objectives of the
company and the personal aspirations of the employees. It is thus an organizations
responsibility to create a healthy environment for its employees and achieve a win-win situation.
An engaged workforce results in lower levels of attrition which assists in
ensuring talent retention. Also, an engaged workforce is more effective
and efficient and works towards continuous improvement, says Vinit
Durve, Vice President - Corporate Human Resources, Zicom ElectronicSecurity Systems Ltd.
Employee engagement is highly important in the IT industry, especially where
everything revolves around employee skills and knowledge. When employees are
committed and positively engaged with the organisation, their attitude and
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commitment towards the companys clients also grows, and thus directly impacts the
customer service level and satisfaction. Thus, a successful employee engagement
helps to create and polish the building blocks at the workplace and not just a
workforce. Engaged employees provide the following advantages: a) Lowers attrition
rate, b) Boosts business growth, c) Spreads positive information about theorganisation and keeps up the companys image, d) Creates healthy work
environment in peer groups, e) Builds employee commitment, trust towards the
organization and help achieve the organizations goals, f) Attracts more people to join
the organisation and builds trust and g) Increases productivity and leads towards
organizational growth,.
It also believes in sharing information with our employees. Information about
management decisions, signing new clients etc. helps to establish a trust between
both the parties and also helps to work towards the a common goal. Open
discussions and brainstorming sessions create a healthy work environment.
Employee suggestions and ideas are equally evaluated and appraised.
Only a satisfied employee can become an engaged employee. It is therefore essential
for an organisation to see to it that the job given to the employee matches his/her
career goals which will make them enjoy their work and lift their spirits high.
Compensation:
Compensation constitutes the largest part to reduce the employees attrition rate.
The employees always have high expectations regarding their compensation
packages. Compensation packages vary from industry to industry. So an attractive
compensation package plays a critical role in retaining the employees.
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Compensation includes salary and wages, bonuses, benefits, prerequisites, stock
options, bonuses, vacations, etc. While setting up the packages, the following
components should be kept in mind:
Salary and monthly wage: It is the biggest component of the compensationpackage. It is also the most common factor of comparison among employees. It
includes
Salary and wages represent the level of skill and experience an individual has. Time
to time increase in the salaries and wages of employees should be done. And this
increase should be based on the employees performance and his contribution to the
organization.
Bonus:Bonuses are usually given to the employees at the end of the year or on a
festival.
Economic benefits:It includes paid holidays, leave travel concession, etc.
Long-term incentives:Long term incentives include stock options or stock grants
These incentives help retain employees in the organization's startup stage.
Health insurance:Health insurance is a great benefit to the employees. It saves
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employees money as well as gives them a peace of mind that they have somebody to
take care of them in bad times. It also shows the employee that the organization cares
about the employee and its family.
fter retirement:It includes payments that an Employee gets after he retires likeEPF (Employee Provident Fund) etc.
Miscellaneous compensation:It may include employee assistance programs
(like psychological counseling, legal assistance etc), discounts on company products,
use of a company cars, etc.
Organization Environment:
It is not about managing retention. It is about managing people. If an organization
manages people well, employee will take care of itself. Organizations should focus on
managing the work environment to make better use of the available human assets.
People want to work for an organization which provides:
Organization environment includes:
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Types of environment the employee needs in an organization
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Lack or absence of such environment pushes employees to look for new
opportunities. The environment should be such that the employee feels connected to
the organization in every respect.
Growth and Career:
Growth and development are the integral part of every individuals career. If an
employee can not foresee his path of career development in his current organization,
there are chances that hell leave the organization as soon as he gets an opportunity.
The important factors in employee growth that an employee looks for himself are:
Work profile:The work profile on which the employee is working should be in sync
with his capabilities. The profile should not be too low or too high.
Personal growth and dreams:Employees responsibilities in the organization
should help him achieve his personal goals also. Organizations can not keep aside the
individual goals of employees and foster organizations goals. Employees priority is
to work for themselves and later on comes the organization. If hes not satisfied with
his growth, hell not be able to contribute in organization growth.
Training and development:Employees should be trained and given chance to
improve and enhance their skills. Many employers fear that if the employees are well
rained, theyll leave the organization for better jobs. Organization should not limit
the resources on which organizations success depends. These trainings can be given
to improve many skills like:
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Need for such trainings can be recognized from individual performance reviews,
individual meetings, employee satisfaction surveys and by being in constant touch
with the employees.
Importance of Relationship in Employee Attrition Program:
Relationship
Sometimes the relationship with the management and the peers becomes the reason
for an employee to leave the organization. The management is sometimes not able to
provide an employee a supportive work culture and environment in terms of
personal or professional relationships. There are times when an employee starts
feeling bitterness towards the management or peers. This bitterness could be due to
many reasons. This decreases employees interest and he becomes de-motivated. It
leads to less satisfaction and eventually attrition.
A supportive work culture helps grow employee professionally and boosts employee
satisfaction. To enhance good professional relationships at work, the management
should keep the following points in mind:
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Supporting Employees
Organizations these days want to protect their biggest and most valuable asset andthey want to do this in a way that best suits their organizational culture. Retaining
employees is a difficult task. Providing support to the employees acts as a mantra for
retraining them. Employers can also support their employees by creating an
environment of trust and inculcating the organizational values into employees.
The management can support employees directly or indirectly. Directly, they providesupport in terms of personal crises, managing stress and personal development.
Management can support employees, indirectly, in a number of ways as follows:
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Feedback
Feedback acts as a channel of communication between the employee and his
manager. The amount of information employees receive about how well or how
poorly they have performed is what we call feedback. It is a dialog between a
manager and an employee which acts as a way of sharing information about the
performance. It suggests where the employee performance is effective and where
performance has to improve.
Managers can provide either positive feedback or negative feedback to employees.
This feedback helps the employee assess his performance and identify the
improvement areas.
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Positive feedbackcommunicates managerial satisfaction. Positive recognition for
good performance boosts up morale of employees and results in performance
improvement to a higher productivity level. It is believed that positive feedback is the
only type of feedback that generates performance above the minimum acceptable
level.
Negative feedbackobviously communicates managers dissatisfaction. However,
negative feedback sometimes make employee to put more efforts to improve his
performance. But such times are very rare. Moreover this improvement is short
term.
Some managers do not provide any kind of feedback to their employees. Due to no
feedback, employees may assume that they are performing productively or they may
feel that the manager is satisfied with their performance. Studies reveal the
performance tends be same or even decreases if no feedback is provided.
Thus, feedback is necessary because:
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Managers have tendency to ignore good performances of their employees. Providing
no feedback may demotivate employees and may lead to employee absenteeism.
Input from managers side is necessary as it help employees to improve their
performance and increase productivity.
Communication Between Employee and Employer
Communication is a process in which a message is conveyed to the receiver by the
sender. The message may be or may not be in a common format or language that
both the sender and receiver understand. So there is a need to encode and decode the
message in the process. Encoding and decoding also helps in the security of the
message. The process of communication is incomplete without the feedback.
Communication is the solution to almost everything in this world. Same applies to
employee retention also Straight-from-the-shoulder communication is what the
employees need from their employers. Employees look for organizations where
communication and process are transparent. Nothing is hidden and shared with the
employees.
There are 3 categories of employees:
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Category A:These are the employees who lack communication with their
employers.
Category C:These are the employees who have proper, well structured
communication with their employers.
Communication is also the way to win the employees trust in the organization.
Employees trust the employers who are friendly and open to them. This trust leads to
employee loyalty and finally retention. Employers also feel that the immediate
supervisors are the most authenticated and trusted source of information for them.
So the organizations should hire managers who are active communicator.
Communication mediums
So there should be effective communication across the organization and thiscommunication should be two-way. Communication alone can lead to unimaginable
heights of employee retention.
Hire Right Talent
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Employee retention starts with recruitment. Early departures arise from the wrong
recruitment process. Here are a few ways to ensure how to hire the right talent for a
particular job.
Hire appropriate candidates.Hire candidates who are actually suitable for theob. For this the employer should understand the job requirements clearly. Dont hire
under qualified or clearly overqualified candidates.
Provide realistic job preview at the time of hiring:Mostly employees leave
an organization because they are given the real picture of their job responsibilities at
the time of joining. Attrition rate can be reduced if a right person is hired for a rightob.
Realistic preview of the job responsibilities can be given to the employment seekers
by various methods like discussions, trial periods, internships etc.
Clearly discuss what is expected from the employee:Before joining theorganization, tell the candidate what is expected from him. Setting wrong
expectations or hiding expectations will result in early leaving of employees.
Discuss what the expectations of the employees are:Ask employees what
they expect from the organization. Be realistic. If their requirements can be fulfilled
only then promise them. Or tell them before hand that their requirements can not befulfilled. Dont show them an unrealistic picture.
Culture fit:Try to judge individuals capability to adapt to the organizations
culture. A drastic change in the culture may give a culture shock to the candidate.
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Referrals:According to the research, referred candidates stay longer with the
organization.
IMPORTANCE OF LOW RATE OF ATTRITION
It will benefit an organization in the following ways:
The Cost of Turnover: The cost of employee turnover adds hundreds of thousands
of money to a company's expenses. While it is difficult to fully calculate the cost of
turnover (including hiring costs, training costs and productivity loss), industry
experts often quote 25% of the average employee salary as a conservative estimate.
Loss of Company Knowledge: When an employee leaves, he takes with him
valuable knowledge about the company, customers, current projects and past history
(sometimes to competitors). Often much time and money has been spent on the
employee in expectation of a future return. When the employee leaves, the
investment is not realized.
Interruption of Customer Service: Customers and clients do business with a
company in part because of the people. Relationships are developed that encourage
continued sponsorship of the business. When an employee leaves, the relationships
that employee built for the company are severed, which could lead to potential
customer loss.
Turnover leads to more turnovers: When an employee terminates, the effect is
felt throughout the organization. Co-workers are often required to pick up the slack.
The unspoken negativity often intensifies for the remaining staff.
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Goodwill of the company: The goodwill of a company is maintained when the
attrition rates are low. Higher retention rates motivate potential employees to join
the organization.
Regaining efficiency: If an employee resigns, then good amount of time is lost inhiring a new employee and then training him/her and this goes to the loss of the
company directly which many a times goes unnoticed. And even after this you cannot
assure us of the same efficiency from the new employee.
TTRITION IN BPO
BPO industry in India is growing at a very rapid pace of 40-50% growth rate
annually. This sector is said to be poised to generate one million jobs by the year
2008. But, this industry faces a very acute problem of attrition rate which is as high
as 30-40%.
To compel this, there is another problem of poaching, which increases the attritionrate. All this leads to higher costs to the company. BPOs need to hire right kind of
people give more to the employees not only in terms of salaries and perks but also in
terms of experience. For good performing employees, the company needs to have a
good career growth plan. Companies need to build a long lasting relationship with
the employees.
Introduction
BPO industry in India is one of the fastest growing industries in the country. It
creates a large chunk of jobs in the country. However, as with the growth come the
deterrents. One of the most critical problems faced by this industry is that of
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attrition. Attrition arises with employees leave the company for one of the three
reasons:
i)Death of employee
ii) Retirement, or
iii) Better opportunity in some other company.
Attrition causes huge loss to the company, not only in terms of manpower but also in
monetary terms.
BPO Industry in India
India has remained one of the most favorite offshore destinations for BPO/ITES
activities. One of the most prominent reasons for the same is cheap labor. Over the
past five years, the Indian BPO/ITES has been growing at a rate of about 50-60%. Asper NASSCOM, the Indian BPO/ITES registered a growth rate of 46% and clocked a
revenue of UD$ 3.6 billion in 2003-04 up from UD$ 2.5 billion in 2002-03.
Source: NASSCOM Review 2004 & Press Release June 2004
This industry has contributed a great deal to the export revenues of the country andis expected to do that in future too.
This industry is expected to generate one million jobs by 2008. HR management is
one of the most critical areas in this industry, so important that it can be referred to
as HR-enabled services rather than IT-enabled services. The reason for the same is
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that this industry is facing a very high rate of attrition of around 30-40%. Though
this rate is not very high as compared to US which faces an attrition rate of around
70% though, our next main competitor in this area, China, is facing the attrition rate
as low as 12-15%. The consequence of the same is that this results in higher costs to
the company and so the companies may loose its main competitive edge which islower costs. This means that there is a very high need to control the attrition rate in
the industry.
Attrition rates in IT-enabled business process outsourcing sector have come down
from the 30-33 per cent being witnessed of late to about 25 per cent now, according
to statistics compiled by the National Human Resource Development Network.
ttrition rates %
US 42%
ustralia 29%
Europe 24%
India 18%
Global Average24%
Cost of Attrition
There are a number of costs which are incurred by a BPO when they hire any new
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employee. These costs can be in terms of monetary or can be in terms of time wasted
or any other intangible things. Some of these costs can be as stated below: -
1. Hiring or Recruitment Costs:Costs of advertisement, agency costs, employee
referral costs, internet posting costs, etc.
2. Training Costs:Induction program costs, lodging costs during that period,
orientation material costs and cost of person who conducts orientation.
3. Low Productivity Costs:As new employee is learning new job, company
policies, etc., they are not fully productive.
4. New Hiring Costs:Cost of bringing new person aboard, time taken in
understanding the job of the employee who left and other perks given.
5. Low Sales Cost:Experience and the contacts that were lost, time for which the
position was vacant and other such things which result in either loss of customers orlower sales.
What all this means is that there are huge costs associated with an employee leaving.
In monetary term, it means that for one person leaving a company, the cost can be
close to Rs. 60,000 or approximately equal to 2 months salary. For a 300-seater call-
center with an attrition rate of 30%, it can be as large as Rs. 60 lakh per annum.
Reasons for voluntary attrition
A question which arises now is that why to employees leave and what is the reason
that the BPOs are not able to hold them back. The BPO industry hires a large
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number of graduates who are bright and ambitious. The overall compensation
structure design is not competitive when compared to general market practices. This
means that BPO employees do not receive as much cash-in-hand as their peers in
other industries. When an organization add unattractive remuneration to working
shifts, lack of career development, and monotonous tasks, it is not surprising thatemployees leave when offered a small salary increase, states Oscar De Mello,
Country Head of Hay Groups Reward Information Services in India.
Well, the most obvious reason that comes to mind is higher pay. Most employees in
BPO are approached with two or three job offers every week, and sometimes it gets
very tempting to resist. The deterring factor for this would be moving from onelocation to another with the family as housing and relocation are two major concerns
of the employees. Though this problem is being taken care to a certain extent by a
salary rise of 10-15% annually on an average basis, but still it prevails.
Another factor which can be a big deterrent is thework timings. The work timings
in BPO are very odd. This affects the family life of the employee. Moreover, the maleto female ratio in BPO is quiet low. The number of females in BPO can be as large as
35%.
This means that working hour problem is quiet acute in their case especially after
they get married, as after marriage comes social and family pressure to adjust work
timings and take care of families.
Though the above two reasons are quiet prevalent, another reason which is becoming
quiet frequent is career growth. Only 2 out of 10 employees on an average go on to
be at the senior level. This means that other employees look forward to change their
ob at other places where they can get better opportunities to progress. Also, another
problem arises with the mis-match of expectations and qualifications of the
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employees. Along with that, some employees see no career growthin this sector,
so they move on to other companies in search of changing the sector.
One more reason for employees leaving the firm is higher education. This is a
problem as most of the employees in this sector are pretty young and aspiring. Theyoin the firm because of lucrative salary. But with time, they try to move on to other
sectors or top management and one of the ways to do this is higher education.
The Road Ahead Strategies to improve voluntary attrition rate
The road ahead for the BPO firms is very important because if they are not able tocontrol the attrition rate they will loose their competitive edge in the global market.
For this certain, strategies and certain improvements are needed to be made in the
processes followed.
Providing Something Extra
Its always about providing something extra to employees. Good salary is something
which is a standard in the industry. So what needs to be done is to give some perks to
the employees. They need to be given perks like rewards for their good performances
Owing to the odd working hours, the employees have very tattered personal lives. So
perks like foreign tours or company sponsored vacations are always a welcome gift.
Honoring Performers
Performance based incentives is a must in the BPO companies as these are generally
the employees who gets picked up by the placement hunters most often. These
employees are also among the most aspiring ones in the company so there is a need
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to give them ample opportunity to rise and progress in the organization.
Building Relationship
Relationship is something which lasts over time. So, if a company needs to hold on toits employees, it needs to build a strong bonding with the employees. There is a need
to instill pride in the employees. They need to be shown that the work done by them
is important. Also, work needs to be shown in the form of challenge to the employee
rather than just a monotonous routine work. Provide employee with ESOPs, which
would give them a feeling that they are working for themselves and that they are an
inseparable part of the company.
The EEE-Model
Exposure, Experience and Education are three things which are vital to any employee
in any sector or industry. These needs of the employees are needed to be taken care
of for an employee to feel motivated.
An employee expects the company to give him good exposure in the kind of work he
is doing. Not only this, he needs to get a good experience working in the company
from its top management and colleagues. Monthly dinner with CEO of bonding
programs with the other employees of the BPO would be a good idea. Also, some
employees aspire for higher education to increase their knowledge base. Somepartnership with management institutes for short courses needs to be provided.
Alternatively, company can bear all the cost of further education for its good
performing employees.
Poaching
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This is something which has become a very big issue in recent times. Poaching means
that one company tries to get experienced employees from other BPOs so as to save
on the training costs and some other associated costs. Companies here need to
understand that poaching affects the industry on the whole and not only themselves.
It raises the costs to the companies on the whole, and thus, can loose theircompetitive advantage of cheaper services if this continues. Some companies have
already understood this and have gone into an anti-poaching agreement. Others need
to follow the same. If needs arise to hire at lateral position from the industry, then
the company should incoming employee to complete his statutory notice period.
HR Practices
HR is the most critical department in any BPO. While conducting the recruitment, it
is in the hands of HR to bring the right kind of people. HR needs to identify the
employees who would stick with the company and not get the employees solely based
on the qualifications and communication skills. Moreover, more diversity in the kind
of companies need to look to hire from non metro cities as the employees from thesecities are more likely to stay with the company than those from metros. Also, they
need to keep an eye on good performing employees and have a career plan in mind.
Not only this, they need to discuss it with these employees on a regular basis and take
feedback from them. They also need to give their employees personal space to grow
and adjust with social life. Moreover, in case of employees leaving a good exit-
feedback system should be in place so as to cover the reason for which the employeesleave.
Office-Tiger: A Role Model BPO to Follow
In a sector which boasts of an attrition rate of 30%, if a company claims of an
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attrition rate of 9%, well, it certainly makes one raise his eyebrows. This company is
Office-Tiger. What the Office-Tiger tries is to instill a sense of pride in its employees.
They make the employees feel proud of doing the work they do. Every project given
to them is converted to a challenge which drives away the monotony that creeps into
the job. Every employee is given a feel that the work given to him or her is veryimportant. Moreover, there is a rigorous recruitment process. After that the
employees undergo an induction program where they hone their various skills.
Employees work on live projects and if, during their project work, they feel that some
improvement is needed, they can go back to that stage of training. This helps the
employee continuously improve himself. Also, employees are given encouragement
to become Financial Analysts or Research Analysts.
Impact of Recession on attrition rates in BPO industry
BPO industry sees dip in attrition rates due to the impact of Recession.
Fewer employees are jumping jobs in the BPO industry, courtesy the ongoing global
recession. As a result, attrition rates (the number of people quitting per 100employees) for several listed BPO firms have come down by 5-13 percentage points
on a sequential basis.
Genpact's employeeattrition rate for the quarter, measured from day one of
employment was down by 5 percentage points to 21 per cent from 26 per cent in the
preceding quarter and 24 per cent for January-March 2008. If the attrition rate, wereto be measured after employees completing six months of employment Genpact's
attrition rate would be 18 per cent.
EXL reported a record 12.8 percentage points dip in attrition for billable employees
at 21 per cent from 33.8 per cent reported in the previous sequential quarter.
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"Operationally, our attrition management and employee engagement programme, in
combination with the weaker economy, has resulted in record low attrition levels,"
the company said in its earnings statement.
WNStoo posted a reduction in its attrition numbers this quarter. Attrition declinedby 7 percentage points to 22 per cent, down from 29 per cent last quarter and 38 per
cent in quarter ended March 2008. "The employment market in India is softer
compared with this time last year," WNS said.
For First source, the offshore attrition (India, Argentina and the Philippines)
remained unchanged at 35.8 per cent during the just ended quarter. The onshore(the US and the UK) attrition was 38.4 per cent compared with 38.8 per cent in third
quarter.
ForWipro BPO, the quarterly attrition has come down by 500 basis points to 13 per
cent from 18 per cent in the previous sequential quarter.
With the global financial meltdown it appears employees prefer to stick to their
current jobs as much as possible. In November 2008 BPO attrition fell to 30%. The
attrition rate in few leading companies is,
In 2007 the attrition rate was about 50-55%.
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Headcount
BPO firms seem to be hiring in smaller numbers as they prefer to work with on-
board employees in a bid to cut costs.
WNS ended the quarter with an employee base of 21,356, higher only by some 28
employees over the quarter ended December 2008. WNS' smaller rival EXL posted a
net increment of 32 employees during January-March quarter. "We continue to hire
about 200-300 employees each month spread across India and the Philippines," a
company spokesperson said.
EXL, which runs a January-December fiscal, had 9,563 employees on its rolls against
9,531 in the previous quarter.
An HR head of a large BPO player pointed out that while the industry was hiring
fewer numbers, companies were also cleaning up their bench. "Companies are not
retaining non-performers. Also, one has to see the employee count in the backdrop ofgrowth of these companies," the official said.
Mumbai-based First source saw a net reduction of 950 employees in the just-ended
quarter compared with net addition of 2,944 employees in the preceding quarter
(October-December), and a net addition of 279 in the year-ago period.
"Reduction in headcount in the fourth quarter is due to large ramp up in previous
quarter getting in to production mode and headcount stabilizing," its CEO, Ananda
Mukerji, said in a recent interaction with analysts.
The quarterly gross hiring numbers for both WNS and First source for the fourth
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quarter were not available. The sole exception to this pack was Genpact, where
growth remained more or less intact on a sequential basis. The company's net
addition stood at 300 employees against 200 employees in the last quarter.
However, the gross addition for January-March quarter stood at 2,200 employees,with hiring largely focused on BFSI and India-to-India business, sources said.
In fact its gross hiring in the first quarter of 2009 is a tad higher than the gross hiring
in the fourth quarter of 2008 at 2,100 employees.
Genpact had about 36,500 employees globally, as on March 31, 2009.
Earlier this month, the association that supports and promotes Indias business
process outsourcing predicted a bright future for the sector. While the past year has
presented challenges, there is undoubtedly strong growth ahead, NASSCOM said at
the CEO Summit 2009.
In fact, Som Mittal, the president of NASSCOM, forecast that outsourcing to India is
likely to increase threefold by 2020, earning aggregate revenues of $225 billion.
"While the short-term challenges exist, the potential for this industry is tremendous
and the industry will not be demand constrained," he said.
These are optimistic words for a sector that is accustomed to robust growth, withmany graduates aspiring to work for one of the countrys top outsourcing companies.
In recent years, salaries in the sector have grown in the double digits on an annual
basis, while employees have had their pick of open positions. However, the recession
has changed "business as usual" at Indias top BPO firms.
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Less employee turnover
The downturn has also had an effect on the level of worker turnover experienced at
BPO firms. In November, LiveMint.com reported that in pre-recessionary days,
employees stayed with the same company for an average of 11 months. But concernsabout job security have prompted people to stay in the same role for longer. The
churn rate in the BPO sector fell from 35 percent in 2007 to under 20 percent in the
third quarter of 2008, according to Live Mint. And Business Week says that current
attrition rates are close to 15 percent. This trend may benefit the industry in the long
term, as workers gain more expertise by working for longer at the same job. Samir
Chopra, president of the Business Process Industry Association of India, toldLiveMint.com that "there are fewer jobs on the job market, but there is also more
maturity in the job market."
CHAPTER III
FINDINGS
Following are the findings on the basis of the project report:-.
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The attrition rate for this industry has come down by an average of 300 500 basis
points (bps).
Before the recession actually started the reasons for high attrition rate were-
But now hell with the pay and hell with the boss, I want money (thats the sole
mantra during recession).
Quarterly attrition
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The salary structure is not competitive in BPO firms as compared to the rest of the
Indian market.
-- The short-term variable component was just 4% last year while the rest of India's
workers enjoyed 10%. Such a low figure does not give any scope in creating incentive
programs to encourage employees to work harder or stay at the organization.
-- The attrition rate at BPOs last year was 23.5% compared to 15% in the general
market.
Employees will stay longer when they see that they can move up to a better job at the
same company.
Other findings of the study were:
-- Many BPO workers use the money they earn to fund a post-graduate degree.
-- The BPO work is attractive to younger workers giving them a new-found freedom
and a unique lifestyle.
-- Many of the jobs are monotonous.
F Retentions policies followed provides the employees both monetary and non-
monetary benefits.
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F The exit interviews were conducted as and when required by the company.
SUGGESTIONS AND RECOMMENDATIONS
Conclusion
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https://www