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Executive summary
Attrition is one of important problem the IT industries are facing now a
days. Thus, I have done research on this subject.
The primary objective of this research is to study the attrition in IT
industry.
The secondary objective of this study is to know what are the reasons
for the employees to leave their jobs, to evaluate how the employees
are valued to the organization and to prove that the organization
policies should be supportive to the staffs working there.
I have used the Descriptive Research design for the research. Also, I
have collected primary and secondary data to do this research.
The sampling unit used is the IT industry, the sample size of the
research is 20.
I have used Questionnaire for collecting the data.
Percentage Analysis and Chi square are the two statistical tools used
for Analysis.
The study reveals that the employees are leaving the organization
because of the work stress and the company policies are supportive to
the employees.
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INTRODUCTION:
Attrition: A reduction in the number of employees through
retirement, resignation or death. Employee turnover is an enormous
problem for any company and creates negative bottom-line impacts.
The costs associated with employee turnover show up in such areas as
advertising for new employees and the time and money necessary to
screen the applicants, training new employees, lost productivity,
decreased accuracy and quality of work among the employees left
behind who are upset about their colleagues departure, using
expensive contract and temporary employees to do the work until a
permanent employee is hired, and the expenses associated with
replacing lost business.
Employee turnover costs can amount to thousands of dollars, annually.
It can also prevent companies from pursuing their growth opportunities
and acquiring new business & Attrition rate is the rate of shrinkage in
size or number
Types of attrition:There are three types as follows:
Market Driven based on the demand for a particular skill or ability
in temporarily low supply (self-correcting in normal markets). The
typical initial reaction by employers to market driven attrition is to
increase wages, offer better benefits, escape the market by relocation
or site migration or relax hiring standards.
Workload or Stress Driven on the actual capacity to perform the
work required. This is when there are not enough of the right people.
Process Driven variables associated with job design and/or the
organization. In some industries and organizations there is a belief that
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attrition has always been there and always will be there. Addressing
this scenario produces the most lasting results.
Attrition Cycle & drivers
Typically, in organizations experiencing systemic or chronic attrition, a
cycle develops as:
Attrition normally brings decreased productivity. People leave causing
others to work harder. This contributes to more attrition, which
contributes to increasing costs, lowe revenue. This often forces
additional cost reductions and austerity measures on an organization.
This in turn makes working more difficult, causing the best performers
with the most external opportunities, to leave.
There are two primary drivers of voluntary attrition. These are, no one
likes to feel inadequate and, in most organizations, it is easier to leave
than stay and try to alleviate the problem. People feel inadequate
when communication is either incomplete or unreliable.
Choices are either absent or insufficient. Often, the challenges in
these situations are unclear, unsatisfying or overwhelming. People willgive up trying to change things when promises are not specific, not
kept or are not fulfilled in a timely manner. Additionally, when
expectations are thwarted, changed arbitrarily or unfulfilled, people
will lose motivation.
Other common demotivators are when commitments are
unacknowledged, vague or incompatible.
Rarely do organizations create environments where employees can
meaningfully participate in activities, which will reduce turnover.
Attrition is commonly thought of as people
terminating employment. Another form of classifying types of attrition
are:
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Empty Chair Attrition: Employees quit and leave
Warm Chair Attrition: Employees quit and stay.
In the best of worlds, employees would love their jobs, like their
coworkers, work hard for their employers, get paid well for their work,
have ample chances for advancement, and flexible schedules so they
could attend to personal or family needs when necessary. And never
leave.
But then there's the real world. And in the real world, employees, do
leave, either because they want more money, hate the working
conditions, hate their coworkers, want a change, or because their
spouse gets a dream job in another state. So, what does all that
turnover cost? And what employees are likely to have the highest
turnover? Who is likely to stay the longest?
Defining Attrition: "A reduction in the number of employees throughretirement, resignation or death"
Defining Attrition rate: "the rate of shrinkage in size or number"
Attrition is beginning to significantly affect offshore ROI. Just as
businesses faced a scarcity of talented IT resources during the dotcom
era, organizations in offshore countries such as India are experiencing
similar pains. Skilled employees are hopping from job to job and taking
with them the customer knowledge and technical expertise that any
company needs. Their salaries are increasing, along with their perks,
benefits, and bonuses.
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Defining the attrition problem
Global outsourcing and the astounding amount of foreign direct
investment pouring into China, Russia, and India have created
tremendous opportunities and competition for talented IT professionals
in those countries. The downside of this increased competition is a
rising rate of attrition, particularly in India. Fiscal third-quarter 2005
(ended December 2004) results filed by Infosys, Wipro, Satyam, and
TCS listed attrition rates between 7.6% and 17.7%. Vendors that we
have interviewed place the numbers much higher, at 25%60%, while
an April 2005 BusinessWeek article estimated an attrition rate of 60%,
with some India service providers experiencing up to 80% turnover.
To put these attrition numbers into perspective, if a company has 100
programmers and an attrition rate of 25%, then 25 of its IT staff will
leave each year. Think about the time and money it took to find,
interview, hire, train, and coach those 25 people. Now think about
losing them and starting the hiring and training processes anew.
How do the hiring and training processes break down in terms of total
costs in India? The typical time for advertising, interviewing, screening,
negotiating, and hiring a new employee is about two weeks.
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Companies usually allot one week for programmers to become familiar
with the new business, two more weeks for technical training, and one
last week for customer training. Now imagine a 25% attrition rate and
replacing 25 of these programmers each year. Based on a yearly salary
of $15,000 for the human resource person and $25,000 for the
programmer, it would cost an additional $63,000 annually in
acquisition and employee training costs. After considering these
figures, it quickly becomes apparent why companies are investing in
strategies to prevent attrition.
Reasons for attrition
It is not easy to find out as to who contributes and who has the control
on the attrition of employees. Various studies/survey conducted
indicates that every one is contributing to the prevailing attrition.
Attrition does not happen for one or two reasons. The way the industry
is projected and speed at which the companies are expanding has a
major part in attrition.
For a moment if we look back, did we plan for the growth of this
industry and answer will be no. The readiness in all aspects will ease
the problems to some extent. In our country we start the industry and
then develop the infrastructure. All the major IT companies have faced
these realities. If you look within, the specific reasons for attrition are
varied in nature and it is interesting to know why the people change
jobs so quickly. Even today, the main reason for changing jobs is for
higher salary and better benefits. But in call centers the reasons aremany and it is also true that for funny reasons people change jobs. At
the same time the attrition cannot be attributed to employees alone.
Organizational matters:
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The employees always assess the management values, work culture,
work practices and credibility of the organization. The Indian
companies do have difficulties in getting the businesses and retain it
for a long time. There are always ups and downs in the business. When
there is no focus and in the absence of business plans, non-availability
of the campaigns makes people to quickly move out of the
organization.
Working environment:
Working environment is the most important cause of attrition.
Employees expect very professional approach and international
working environment. They expect very friendly and learning
environment. It means bossism; rigid rules and stick approach will not
suit the call center. Employees look for freedom, good treatment from
the superiors, good encouragement, friendly approach from one andall, and good motivation.
Job matters:
No doubt the jobs today bring lots of pressure and stress is high. The
employees leave the job if there is too much pressure on performance
or any work related pressure. It is quite common that employees are
moved from one process to another. They take time to get adjusted
with the new campaigns and few employees find it difficult to get
adjusted and they leave immediately. Monotony sets in very quickly
and this is one of the main reasons for attrition. Youngsters look jobs
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as being temporary and they quickly change the job once they get in
to their own field. The other option is to move to such other process
work where there is no pressure of sales and meeting service level
agreements (SLA). The employees move out if there are strained
relations with the superiors or with the subordinates or any slightest
discontent.
Salary and other benefits:
Moving from one job to another for higher salary, better positions and
better benefits are the most important reasons for attrition. The salary
and offered from MNC companies in Bangalore, Delhi and Mumbai have
gone up very high (Rs 15000 to Rs 18000 per month) and it is highly
impossible for Indian companies to meet the expectation of the
employees. The employees expect salary revision once in 4-6 months
and if not they move to other organizations.
Personal reasons:
The personal reasons are many and only few are visible to us. Theforemost personal reasons are getting married or falling in love or
change of place. The next important personal reason is going for
higher education. Most of the BE, MCA and others appear for GATE
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examination or other examinations and once they get cleared they
quickly move out.
Health is another aspect, which contributes for attrition. Employees do
get affected with health problems like sleep disturbances, indigestion,
headache, throat infection and gynecological dysfunction for lady
employees. Employees who have allergic problems and unable to cope
with the AC hall etc will tend to get various other health problems and
loose interest to work.
Poaching:
The demand for trained and competent manpower is very high.
Poaching has become very common. The big companies target
employees of small companies. The placement agencies have good
days for doing more business.
The employees with 4-6 months experience have very good confidence
and dare to walk out and get a better job in a week's time. Most of the
organizations have employee referral schemes and this makes peopleto spread message and refer the know candidates from the previous
companies and earn too.
Employees advocate:
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One of the main reasons why employees leave companies is
because of problems with their managers. An HR professional can be
termed an employees advocate and a bridge between top
management and employees at all levels. There is a huge gap between
HR professionals and employees in terms of understanding challenges
and delivering requirements. HR has not really understood 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 HR department
should have genuine interest in the employees welfareit is
responsible for making sure that their expectations are met. By doing
this it is easier to meet the companys business targets.
How Insights Can Help Build Strong Manager/Employee
Relationships:
The Insights Discovery System is based on perspectives and attitudes
relevant to understanding organizational and cultural requirements
and needs of people in relation to motivation and leadership. The
understanding of individual differences that Insights provides is
fundamental to improving communication, co-operation and building
effective and high morale teams. This understanding is what bridgesthe gap between manager and employee.
The Insights Discovery System generates reports that reveal personal
preferences or triggers of each individual - including issues that cause
stress. In essence, Insights can bring about a closer relationship
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between employee and manager to enable both parties to better
adapt, connect and understand one another.
An employee may be highly competent but his or her style may be
different from that of the direct manager. The "Value to a Team"
section of an Insights report provides crucial information to a manager
who tends to evaluate all employees against one set of standards.
Insights can help managers recognize the value and uniqueness of
each person's contributions then reward them accordingly.
Insights also serve as a communication vehicle for discussions about
an employee's current and future interests. Insights help managers
and employees better identify what values (needs) are most important
to each individual and how these values impact the person's attitude
towards work. Values can range from an employee feeling stable and
secure to someone enjoying challenge.
The Insights Discovery System is a powerful workforce enhancementtool. It can:
- Enhance the effectiveness, commitment and retention of an
incumbent workforce though increased understanding of human
behavior
- Motivate and retain employees whose basic monetary and material
needs may have been satisfied, but who are seeking their internal
drives
- Improve HR planning and development
- Identify motivational and managerial issues related to interpersonal
style
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- Reduce the impact of turbulence and organizational transition on
employee commitment and productivity.
How to save high attrition rates?
How much would you invest to keep your employees focused
and happy?
This is the question on the minds of CEOs and managers worldwide as
the technology boom lifts and the employment market opens.
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From the employer's perspective, employees are an investment. You
interview to make sure an individual has good work ethic, motivation,
and drive. Most of the time, employees are considered a financial
investment. Yet there's much more to it than that. There is a
significant emotional investment that is crucial to accelerating
business strategies and reaching organizational goals.
You probably know someone who owns an outdated, overused vehicle
but won't entertain the thought of trading it in even though they can
afford to upgrade. Why, you might ask, do they keep it? Well, the
owner has probably invested substantial time, money and care into
keeping it in top condition, not to mention the dependability that has
taken them to countless doctors appointments, baseball practices and
events. It seems senseless to throw it away. The cost of replacing the
vehicle would be enormous compared to the cost of upkeep on the old
one. Even with inanimate objects, we become accustomed to
personality and quirks and develop a common trust.
When this same logic is applied to employees, we find the cost of
replacing employees comparable to that of investing in a new
automobile. Recruitment, hiring, benefits and administrative costs put
an organization upside down on the investment.
Thankfully, companies have come to realize that keeping employees is
more cost-effective than replacing them. Retaining valuable employees
has other benefits - retaining the vault of knowledge that's been
accumulated, skills learned and trust and relationships they have built
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with customers and co-workers.
People Are Not Easily Replaced
Even though today's pool of unemployed workers is deep,
organizations choose to spend more time and resources on retaining
existing employees than starting from scratch. Yes, there are financial
reasons behind this focus on retention. However, there are many other
contributing factors such as the effect attrition has on customer
service, corporate culture and employee morale and loyalty. All these
factors can and will be effected by turnover. Basically, when good
people leave an organization they take their training and knowledge
and often times, relationships with them.
Drivers of Turnover
Turnover is often driven by corporate restructuring and tight
competition for key talent. For many firms, surprise employee
departures can have a significant effect on the execution of businessplans and may eventually cause a parallel decline in productivity. This
phenomenon is especially true in light of current economic uncertainty
and following corporate downsizing when the impact of losing critical
employees increases exponentially.
When managers or supervisors are asked why good people leave, most
respond, "Its about money." Or, they dismiss the departure matter-of-
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factly by stating the employee "received a better offer." Contrary to
popular belief, research indicates that money is not even on the list of
top five reasons employees give when asked why they are leaving an
organization.
When viewed from the employees' perspective, a healthy organization
is one in which people are generally satisfied with the quality of their
work life. On most days they feel good about going to work. They feel
empowered to help shape decisions that affect them, they have the
resources and skills to satisfy customer needs and they are generally
confident in the abilities of the leadership team.
From the organization's perspective, the organization is healthy if it is
viable as measured by profitability, competitive market position and
customer satisfaction. A healthy organization also responds well to the
need for change; it is adaptive and thereby ensures its future -
meaning that following a major upheaval or transition, the healthy
organization rebounds and employees remain committed.
Bottom line, it is the role of the manager, that most influences an
employee's decision to stay or depart from an organization. People will
leave if they don't like their manager - even when they are well paid,
receive recognition and have a chance to learn and grow. In fact,
disliking or not respecting the boss is the primary reason for talent
loss.
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Research shows the reasons for employee departures are:
1. Employee/manager relationship
2. Inability to use core skills
3. Not able to impact the organization's goals, mission
4. Frequent reorganizations; lack of control over career
5. Inability to grow and develop
6. Employee/organization values misalignment
7. Lack of resources to do the job
8. Unclear expectations
9. Lack of flexibility; no 'whole life balance'
10. Salary/benefits
It is very important to know that the above factors are often NOT the
ones mentioned in most attrition studies published by individual
organizations. Additionally, this information does not match the data
frequently obtained during an employee's exit interview when asked
about the reasons for departing. The rationale behind this discrepancy
is that exit interviews are frequently conducted by the departingemployee's manager or HR manager, hindering honest responses.
Typically, employees are hesitant to tell these company
representatives the truth for fear of burning bridges or getting a bad
reference.
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How to curb attrition?
Money is not everything
Although the importance of higher packages is slowly diminishing,
among fresher or laterals with less than three years of work
experience, money is still considered to be the highest priority.
Employees want not only work recognition, but also extra perks." A
number of professionals are looking at more challenging jobs. "In
several cases, faced with a choice between more money and a
challenging job, employees have opted for the latter as it allows them
to learn new technology and increase domain expertise." People
analyze the training programmes of prospective companies with those
of their current organization, which means that how an organization
grooms an employee is weighed to a greater extent. This is because
they know that developing next-level skills will keep them ahead in the
job market, and finally result in better compensation. They also look for
a job with higher levels of responsibility, better learning opportunities.
Vision and objectives
The next level of communication, a crucial part of retention,
starts with acquainting employees with the companys vision and
objectives. Organizations successful in retaining employees clearly
pass on their goals and achievements. Conducting regular meetings
and updating employees, especially new entrants, about the
companys status and achievements is a must. They should
concentrate on leadership and brand building as people prefer to be
associated with a brand. Respect for the job should be created by
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BPOs. The youth should feel proud to be a part of the billion-dollar
industry.
Mentoring and handholding new recruits from day one to four months
are important tasks; during this period, they should be familiarized
with the culture of the company. It is at this time that new entrants
experiment with different options. Hence they should be exposed to
the best values the company has. If they are informed about regular
happenings in the company, employees will be confident about the
future and not try to look for better options.
Treat employees like Customers
Even while companies strive to understand which organizational, job,
and reward factors will contribute to holding back employees, industry
experts have found several loopholes at the top management and HR
management level. Companies should have a similar approach to
employees and customers. If a company strives to retain an employee
in the same way it tries to retain a customer, him leaving the
organization could be out of question.
Since software professionals have different priorities at different points
of time, organizations need to structure their offer-mix while recruiting
new hires, as well as promoting potential ones. Communication is the
foundation for the entire process of managing attrition. Thiscommunication begins right from recruitment. In cases of peer
pressure, an employee aims to join a well-known company. This could
be achieved by brand building, which attracts the right talent and
helps in retention as well.
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Understanding an employees needs at various levels is a
recommended HR practice.
Firing
Sometimes, firing can look like attrition. Looking at firing and attrition
together in a different light, firing can be an excellent tool to contain
attrition. Attrition can simply be defined as employee leaving his
current job due to reasons like, job pressure, health problems, personal
reasons, inefficient boss, lack of job security etc. All the above reasons
are interlinked and can be the reasons for good workers to quit. If the
team has under-performers who despite given sufficient support and
training is unable to perform, but they continue to be part of the team
damage the morale of the team. A performer will not want to be part of
the team, which has non-performers because he will have to
compensate for the non-performer, thereby increasing his job
output/pressure. A continuous job pressure results in health problems.
Having frequent health problems not only reduces his performance,
but also affects him financially. At this juncture, the performer realizes
that he is working with an inefficient manager who is not capable of
cleaning up the team by firing non-performers. With the above, the
performer employee feels insecure and resigns. Firing non-performers
can be an efficient tool to contain attrition.
Consider feedback
It is important to take feedback from employees through different
means and work with the HR department to iron out differences. As
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industry experts point out, feedback can be got in two waysduring
the employees tenure, and through exit interviews. Inputs can be
secured from existing employees through various employee
relationship management tools. The Wipro Listens and Responds
initiative at Wipro aims to capture the concerns and grievances of its
employees.
The feedback we get through this tool will be analyzed, and action will
be taken on it. Our employees are very excited that their feedback is
being taken seriously, says Sahoo. Exit interviews help management
learn the reasons why employees leave the company; based on their
revelations, the organization can address the problems of existing
employees, thereby curb attrition.
Spend Time Developing and Benchmarking Incentives
Whenever the demand for a professional in a particular field heats up,
the perks associated with the job start to pile up. Standard perks for an
India-based "fresher" (a new entrant in the IT services industry with
little work experience) typically include free transportation, educational
assistance, healthcare benefits, performance-based bonuses, onsite
cafeteria, stock options, and interest-free loans to absorb the cost of
relocation or maybe to finance the purchase of a two-wheeler.
According to Wipro's web site, its employees even have access to an
agency that will handle such "domestic chores" as paying bills, thereby
giving IT workers more free time.
An important part of designing incentives is aligning them with market
benchmarks. As far as salaries, HR firm Hewitt Associates reports that
India showed the largest overall salary increase in the Asia-Pacific
region in 2004. Salaries in India grew by 11.6% overall, while China
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trailed with a 6.4%8.4% hike, the Philippines showed a 7.4%7.7%
increase, and Korea saw wages jump by 6.4%6.8%. Salary increases
for middle managers in India were even more dramatic: Nasscom,
India's software association found that salaries for middle managers
rose by as much as 30% in the last two years. These salaries are often
paired with expansive benefit packages that include standard entry-
level benefits as well as special services such as help finding and
buying a home or enrolling children in school.
Captive centers and IT service providers have to offer innovative
compensation and benefitsor risk losing valued employees to
competitors. Nonstop evaluation and benchmarking are "need to do"
activities for IT managers.
Subsidize Education and Certification
In the United States, many companies reimburse employees for
advanced degrees or certifications that relate to their area of
expertise. Until recently, the opposite was true in India, but that trend
has begun to change as businesses have discovered that a significant
portion of their attrition problems stem from employees leaving to
pursue a master's degree. Several offshore service providers have
teamed with universities to offer their workers management-level
master's courses at a subsidized rate, and watched attrition rates drop
as a result.
For example, Cognizant Technology Solutions, an IT service firm with
17,000 employees, partially reimburses Indian staff that pursues
master's degrees at BITS, a higher-education institution located in
Pilani, India. Business process outsourcing (BPO) player 24/7 Customer,
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in association with the Indian Institute of Management Bangalore,
launched a management-education seminar series called "Beyond
Knowledge," through which 24/7 aims to educate employees about the
BPO industry and discuss related careers. Multiple providers have
followed the lead of Cognizant and 24/7.
In several offshore countries, advanced degrees are considered crucial
to social standing. It's important for U.S. firms with little international
experience to recognize this desire among employees and design
programs accordingly.
Change Locations
The high prices and resource crunch in top-tier Indian cities such as
Bangalore and Mumbai have led many companies to execute
alternative location strategies. Many vendors are sending work to tier-
two cities (Hyderabad or Chennai) or even tier-three cities (Noida or
Chandigarh), where labor and real estate costs as well as attrition may
be cut in half. Such benefits come at a price: The infrastructure quality
lags that of more advanced cities, and the search to find qualified
people may take longer.
Another option to combat the rising attrition rates in India is to locate
in other countries. Sykes Enterprises, for example, disclosed that it is
relocating the customer contact management work at its Bangalore,
India, facility because the center delivered an inadequate return and alimited competitive advantage. The Tampa-based company thinks the
work is better suited for the other Asia-Pacific offshore centers in its
portfolio, such as China. Sykes expected to incur total charges of
approximately $0.8$1.5 million for its plan to relocate work.
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Rotate Employees
Employees who don't feel challenged by their work often leave. In
response, companies such as TCS have programs that rotate
employees into different disciplines about every two years and expose
them to new locations, projects, and technologies. L&T InfoTech, a
software solutions provider with 4,000 employees and six development
centers in India, has implemented a similar program.
Offshore employees are asking for a clear career path with increased
responsibility and frequent recognition of achievement. Established
U.S. and European multinational companies have long had learning
programs that set expectations for performance goals such as learning
a particular tool or proprietary software. Companies practicing off
shoring need to provide new challenges and opportunities for skills
development through training or job rotation. It may become the only
reason your best employees stay with you.
Combat Poaching by Encouraging Referrals
Rather than going through a prolonged posting process and screening
a deluge of rsums, some companies poach employees directly from
their competitors and offer to double salaries or buy out contracts on
the spot to scale up quickly. Poaching is generally a bad idea, as it
drives up salaries and discourages employee loyalty.
An employee referral program can serve as an alternative and
effective recruiting strategy. Satisfied employees can be a company's
best sales tool and add a personal touch that a print or radio campaign
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lacks. A Voice & Data survey of the top 15 Indian outsourcing
companies with 1,000-plus employees found that referrals constituted
23% of new hires. For some companies, the number was even higher,
at 40%. The study also observed that recruits hired through employee
referral programs are "stickier"; that is, they stay with companies
longer than non-referrals.
Just Ask: Are Your Employees Satisfied?
Retention is inextricably linked to employee satisfaction, so it pays to
periodically survey employees hopefully before their exit interviews
about job satisfaction issues, and act on the data gathered. The aim
is to determine why some employees depart and some remain with the
company, and to define the traits of productive, successful employees.
Many companies examine the reasons employees leave, which don't
reveal as much as the reasons they stay.
An important aspect of implementing a retention program understands
that it should not be one-size-fits-all. If incentives are meant to keep
employees happy, then they truly have to be designed with the
employee in mind. Too often, employers and employees disagree onwhat constitutes a good incentive. For example, a company might
reward a father with three young children a monetary bonus as thanks
for working overtime for five months straight. To the father, however,
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days off might have been more attractive, since they would have
allowed him to spend time with his family.
Knowing your employees and personalizing rewards makes a
difference. The global workforce has different, individualized needs,
and organizations should tailor incentives for their employees if they
want to retain them. If your company doesn't bother, don't be
surprised if workers head for the door as soon as year-end bonuses are
handed out or stock options vest.
Spend More Time Recruiting
With huge projects ramping up within exceedingly short windows, it
can be hard to convince management to allot more time to the
recruiting process. However, it's difficult to retain good employees if
the company doesn't have a process to hire the right people in the first
place. Simple measures, such as incorporating skills tests that relate
directly to the job in question, can help companies to determine
whether the applicant is indeed an expert programmer or merely an
intermediate programmer. Having employees interview candidates
also may increase the chances of success, as these employees canbetter identify potential personality clashes that HR personnel may not
spot.
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Costs of Turnover
The impact of employee turnover on company performance is often
understated by organizations. This describes how the cost of turnover
is can be calculated using some basic organizational parameters. The
purpose of this document is to provide talent cost of turnover
calculator with insight into how costs are calculated and the reasons
why certain costs were include or excluded form the calculator. The
calculator should only be used as a guide in understanding the impact
of turnover on a company. If the desire is to understand the true cost
of turnover then it is suggested that a greater degree of analytical
work is undertaken.
The key areas used in the calculation of turnover are:
Administration and sourcing costs
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These include the administration of the termination and recruitment
functions together with the costs associated with interviewing, testing
and attracting applicants.
New Hire costs
Once a person has been employed an organization generally spends
significant resources in the induction and administration of bringing
them into the organization.
Lost productivity
The hidden costs associated with lost productivity of employees prior
to leaving the organization and new less skilled employees are one the
largest components of the total cost associated with turnover.
Dysfunctional and avoidable turnover
Determining the level of dysfunctional and avoidable attrition provides
a perspective on the scope of control that a company has to manage
their turnover costs. Determining the cost of turnover is the first step
in the process of developing a management plan. To deal with an
attrition issue effectively the reasons for turnover and an
understanding of the demographics of turnover need to be understood.
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Undoubtedly, the financial costs of turnover have attracted the
attention of academics and practitioners alike. Besides the more
familiar costs associated with the administration of terminated
employees the economic costs such as productivity losses need to be
included in any calculation. In particular, departure of employees -
especially experienced or talented ones - may threaten overall firm
productivity or client retention. Furthermore, personnel losses may
endanger the firms future opportunities in the marketplace or the
morale of their remaining work force. Human resource accounting
experts Cascio, Hom and Griffeth define exit expenses as having two
main components - direct and indirect costs.
A company incurs both direct and indirect costs that result in losses in
production dollars and overall production volume, as well as increased
administrative costs. Direct Costs are actual dollars spent each time anemployer has to attract, select, and induct a replacement for an
employee who leaves the organization. Indirect costs are those
expenditures attributable to turnovers affects on production - that is
costs for incomplete or disrupted work, loss of quality, etc.
The cost of turnover can be calculated by measuring the time taken to
administer each activity plus the direct costs such as advertising costs.
The turnover costs calculated using the calculator represent dollars
spent. The potential loss of revenue if these dollars were invested
elsewhere or through lost productivity is not calculated. Therefore, the
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figures are an indication of the minimum costs that the organization is
subjected to when an individual leaves the company.
Administration & Sourcing costs
The most visible cost of turnover is incurred by organizations in the
area of recruitment administration and sourcing. The time associated
with processing terminated employees and recruits places a burden on
organizations where staff turnover is excessively high. The assumption
is that this is largely an administrative task conducted by people at
80% of the average company salary. In addition the direct costs to a
company for recruitment agency and advertising costs are highlytransparent.
1. Process Administration:
Resignation Administration -
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The time taken to administer a resignation will include activities
such as: conducting exit interviews & processing of administrative
tasks. The time taken to perform these activities is ideally measured
as a result of analyzing the processes involved.
2. Recruitment Administration -
A large amount of time is often spent in administering the
recruitment process. Writing the job ad, posting it onto job boards,
organizing agencies and reference checking all require the use of
organizational resources, whether internal staff or outsourced. The
hours spent involved in these activities does need to be factored
into the cost of turnover.
3. Sourcing Costs:
The cost of sourcing a successful applicant from an agency may be
one of the largest single direct costs associated with recruitment.
4. Advertising costs -
The cost associated with posting job ads to job boards or traditional
media such as newspapers can be significant. The average cost per
vacancies is used within the calculation.
5. Interview Costs:
Interview -
A core component of recruitment administration is the cost
associated with interviewing applicants. Interviews make use
internal resources. The more interviews held and the greater the
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number of candidates interviewed the larger the costs associated
with these activities.
Testing -
Companies are making greater use of psychometric and aptitude
testing in their recruitment processes. These tests can be costly to
administer and as such need to be factored into the overall attrition
costs.
Travel -
Companies may pay the costs associated with bringing an applicant
to the interview location. Although this may not be done for every
candidate an average is used in the I4 calculator.
Cost of New Hire
The two costs measured in this area are the administrative tasks
associated with inducting a new hire into the organization and theassociated induction training. When measuring the cost of attrition
sometimes the total cost of training that an individual has received
whilst in the employment of an organization is included. However, as
all learning undertaken by employees will be used back on the job an
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add value to the business it is inappropriate to count it as a cost of
attrition. Also, where particular jobs have high training, often there is a
corresponding lower rate of pay which acknowledges the investment
that the organization is making in the individual, eg. Youth wages. One
aspect of training directly associated with turnover, however, is the
induction of new staff to the organization. High staff turnover will
necessitate greater levels of resources being made available to induct
new employees. It is the opportunity costs of these resources that
must also be calculated.
1. Induction Administration
The process of induction into an organization can involve a substantial
amount of time. The activities included here would include the
processing of new hires into organization systems (HR) and
introductions to fellow employees.
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Induction Fixed Costs -
The fixed costs associated with inductions include the cost of materials
such as induction kits and staff manuals.
Induction Training -
Any initial training received by an employee on joining the company.
This includes the costs of the materials, presenters and the opportunity
costs associated with the new employee taking time off work to
participate.
Relocation Expenses -
Similar to travel these cost are incurred by companies in an effort to
source the best talent for alternate locations. An average cost needs to
be captured as part of the calculation process.
Productivity Losses
The most detrimental aspect of staff turnover is lost productivity.
Evidence has found that leavers often miss work or are tardy before
they depart. Deery and Iverson argue that according to progression-of-
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withdrawal models the productivity of leavers may deteriorate before
they depart.
Turnover is commonly viewed as belonging to a family of withdrawal
behaviors that physically distance employees from unpleasant work
settings. Serving a common psychology function, withdrawal actions
reduce the time spent in an adverse environment and thus reduce job
dissatisfaction.
Studies have shown that employees leaving a company will have a
greater level of absenteeism prior to leaving. Excessive sick leave is
not only costly, but is also an early warning signal that an individual
may be considering resigning from the organization. Not only does
staff take more sick leave but Hom and Griffeth state that their overall
productivity decreases as well. Furthermore, resignations may disrupt
other employees work if their work depends on the leavers or they
must assume the leavers duties.
The second effect of loss of productivity occurs when new hires join theorganization. They will not have the networks, understanding of
organizational processes or product/service knowledge to be effective.
Studies have shown that a new hire will generally take between 3- 8
months to become effective in their new role. The longer period is
associated with more senior roles.
Excluded costs
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Not all the costs associated with turnover have been included in the i4
attrition calculator. Costs that cannot be accurately measured or
assumed have been excluded. These costs, although hidden, may be
the most critical in terms of organizational impact. Examples of hidden
costs are included below to highlight the organizational impact of
attrition.
Employee Demoralization
Turnover may erode the morale and stability of those who remain
employed. Their morale suffers because they lose friends and may
interpret motives for quitting as social criticisms about the job. A belief
that a leaver has a better job elsewhere may change employees
perceptions of their jobs. As a result stayers may denigrate their
present position in the light of superior alternatives and begin
contemplating other employment. This phenomenon may lead to a
cycle of attrition whereby employees leaving a company prompt other
to do the same.
Impaired Quality of Service
Turnover also hinders the delivery of service and retention of
customers. Attrition among service personnel impairs customer service
because understaffed branches delay or withhold service. Unlike
experienced leavers, new employees may also provide less competent
or less personalized service because they do not know the clients and
cant meet customer expectations through lack of knowledge andexperience.
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If satisfied employees make customers feel well treated, disgruntled
employees may provide careless service before they leave. Turnover
also interrupts the transmission of service values and norms, which are
the essential underpinnings of high quality service, to successive
generations of employees. Customers' perceptions, attitudes and
intentions seem to be affected by what employees experience, both in
their specific role of service employees and their more general role of
organizational employees. It has been found that there is a high
correlation between employee turnover and customer turnover.
Therefore, the cost of decreased customer satisfaction and loyalty
should be taken into account when considering staff turnover.
Turnover reason & cost impact
Just as attrition can lower productivity, incur financial costs, and
undermine stayers' morale, turnover can have the opposite
ramifications under certain circumstances or for certain firms. That is
that the exit of marginal performers may improve overall firm
productivity, while new replacements for leavers can infuse
companies with new ideas and technology. Though turnover is
obviously costly, personnel shrinkage - especially among
administrative staff - can nonetheless reduce overhead costs. Further
resignations may create more job and empowerment opportunities for
employees who remain in firms.
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Functional and Dysfunctional Turnover
Departing from conventional beliefs, some academics point out that
turnover can prevent stagnation and complacency, facilitate change
and innovation, and displace poor performers. Turnover is not
inherently negative. Although it creates personnel costs, the
organizational consequences of turnover are dependent on who leaves
and who stays. The departure of good performers is construed as
dysfunctional turnover - representing a loss to the organization - for
their replacements are likely to be of lower caliber. The departure of
poor performers is viewed as functional turnover - because they are
apt to be replaced by better performers. Research into whether high
performers or low performers leave tends to have found mixed results.
A meta-analysis conducted by McEvoy and Cascio found that generally
it is the poor performers that will leave their place of work. There are
two possible explanations for this: firstly, terminated staff has on
average a lower tenure than current staff and so have not had the time
or opportunity to develop the skills necessary to perform well; or the
current performance management systems which exist are
encouraging high performers to stay and poor performers to quit.
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Avoidable and Unavoidable
Further differentiation should occur between organizationally avoidable
turnover and organizationally unavoidable turnover. For example,
organizations cannot control (that is, it is unavoidable) turnover caused
by an employees death, or by an employees quitting to follow a
relocating spouse. It is important to identify carefully those exits that
are avoidable and those that are unavoidable. After all, leavers whose
departures are unavoidable resemble stayers more than they resemble
the leavers whose departure is avoidable; they do not resign because
they are unhappy with their jobs or the organization.
Despite the appeal, determining whether exits are avoidable or
unavoidable may prove difficult because employees may falsify reports
of their reasons for leaving, they may not wish to burn their bridges
behind them.
The cost of attrition is only calculated on the level of avoidable
turnover. There is no benefit in including the cost of unavoidable
turnover since a company has no control over these events and can
therefore not put in place action plans to minimize the negative
consequences of staff turnover.
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Software firms R&D centers in India facing double-
digit attrition rates
Research and development centers at Yahoo Inc., Microsoft
Corp., Adobe Systems Inc. and other multinational software product
firms are facing a slowdown in growth and product development work
in India as they battle double-digit attrition rates with key personnel
quitting to join start-ups or launch their own ventures.
Headhunters specializing in talent for large software product firms in
India, executives at emerging start-ups and entrepreneurs said
attrition rates are set to touch 20-25% annually, making it difficult for
such product makers to hire and retain top talent.
They are losing people to start-ups. And why is that happening? In the
MNC captives, peoples careers are stagnating and many people are
saying, Look Ive built this product, Ive gone through five product
cycles. Why not go through a product cycle at a smaller company
because I can get better value out of that?, said Sharad Sharma,
chairman of the Nasscom Product Forum and entrepreneur-in-
residence at Canaan Partners, a US-based venture capital firm focused
on technology start-ups.
Take, for example, 30-year-old software architect Mohammad Aamir,who recently quit his job at Adobe to join an enterprise mobility start-
up Bitzer Mobile Inc. After six years of working on a single product at
Adobe, Aamir felt he had reached a saturation point and needed to
work on newer products.
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In a big company like Adobe or Microsoft when you work on a product,
you end up working in big teams, where you often tend to get sidelined
and your presence is not noticed. You dont have the level of exposure
or responsibility that you get at a start-up, said Aamir. At my new
workplace, Im involved not only in technical management, but also
people management and business development. Im at the top level of
the picture.
Also, the entrepreneurial environment is becoming increasingly
conducive to start-ups in India, with more angel investors and venture
capitalists willing to throw their weight behind innovative ventures.
Even though average attrition rates for the countrys R&D industry
have not increased, the levels havent dropped either, experts said.
Indias R&D industry accounts for 200,000-300,000 engineers working
in more than 700 multinational firms, according to technology advisory
firm Zinnov Management Consulting Pvt. Ltd.
With the number of offshoring jobs coming into the country not that
high right now, attrition should have ideally slowed down. But that has
not happened, said Anshuman Das, co-founder and chief operating
officer of CareerNet Consulting, a company that recruits engineers forproduct development centers at MNCs. Thanks to so much
entrepreneurship happening out here, attrition rates are still kind of
similar, which is 15-25% range, that I still see happening.
Another reason for the stagnation in growth is that India doesnt figure
high on the value chain, with many of the MNCs centres in India
contributing only 2-3% to their overall global revenue. Also, many
MNCs have reached the maximum level on the amount of R&D work
they can send to India, which is 30-40% of their overall R&D activity,
said Sharma.
Will it be 60% tomorrow or 80% tomorrow? Its very, very unlikely.
They logically cant offshore more than 40% of their R&D... Theyre
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building a product that the company is selling to the market, so it is
core to the market and, therefore, theres a limit to how much they can
offshore and that limit is being reached, Sharma said. Also, with
some of these technology changes that have taken place, cloud-like
changes, the team sizes of products have shrunk.
Incidentally, Sharma, who quit Yahoo in 2009 after two years as its
research head in India to join Canaan, helped form a separate forum
for product companies last month called the Indian Software Product
Industry Round Table, or iSpirt.
According to industry executives, even if a products team becomes
smaller, the co-ordination costs remain the same.
Google and Adobe did not respond to requests for comment. Yahoo
India R&D did not comment on the attrition figures, but its vice
president and CEO Shouvick Mukherjee said in an email, We have
seen a reverse trend in recent years where a lot of folks working for us
in the US have been coming back to India to work at our Bangalore
centre... Even people who left Yahoo to join start-ups have chosen toreturn for a second innings...
Microsoft did not provide a break-up of attrition levels for the last two
years but said in an email response that the average attrition rate at
their India R&D center was 7% for the last five years.
Flipkart Online Services, the countrys largest online retailer, has been
one of the beneficiaries of the exodus from multinational tech firms.
Experienced technologists from MNCs are attracted to us because it
gives them the chance to own and build solutions and do it on a large
scaleand we have seen senior talent from established product
companies joining us in large numbers over the last couple of years,
Flipkart chief people officer Aparna Ballakur said in an email response.
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Some experts say multinational firms are learning to do more work
with fewer people.
Most of these GICs (global in-house or R&D centres) are trying to add
more value to the job, with the headcount not growing as much as the
revenue growth is. Theyre doing more work with less people,
said K.S. Viswanathan, vice president of industry initiatives at industry
lobby National Association of Software and Services Companies, or
Nasscom.
Also, India has not lived up to the hype of being a hub for innovation
something that was widely projected after the dotcom boom in the
mid-2000s.
Most of these MNCs are not launching their new and upcoming
products in India. So, as a result of that, a lot of new products are not
happening in India and its mostly the sunset products which are
happening in India, and hence the kind of work you end up doing is not
something that you feel does justice to your competency, said Das.
A Zinnov study issued last week seems to support that theory. The
study, conducted among 100 multinationals with an R&D presence in
India, revealed that only 26% have global roles based in the countrydespite over 40% of the headcount being located here.
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Attrition in India to top world charts in 2013; one in
four employees to change jobs
One in four employees in the organised sector in India is set to switch
jobs, the highest attrition rate globally, according to a Hay Group
study. The series of fresh investments planned across sectors could
raise demand for talent even as economic conditions remain tepid,
raising concerns on employee engagement and retention.
We are in the eye of an employee turnover storm. Organisations in
India must give serious thought to what drives employee
commitment," says Mohinish Sinha, leadership and talent practice
leader, Hay Group India. Firms need to focus on employees with
mission-critical skills, as well as high-potentials and those holding
crucial roles, he adds.
Employee turnover is predicted to rise to 26.9% in 2013 with an
employee base of Rs 3 crore compared with 26% in 2010 on an
employee base of Rs 2.8 crore, according to the study, 'Preparing for
Take-Off', conducted in association with the Centre for Economics andBusiness Research. It covered 700 million employees in 19 countries.
Worldwide, attrition is predicted at 21.2% in 2013 on an employee
base of Rs 71.6 crore compared with 20.3% in 2010 on an employee
base of Rs 64.4 crore. The number of workers expected to take flight
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will reach Rs 161.7 million in 2014 - a 12.9% increase compared with
2012 - as growth builds and employment opportunities increase,
according to the study. Comparatively, turnover was minimal between
2010 and 2012. In the next five years, 49 million employees will leave
their employers globally.
The figure is indicative, and helps to understand the employee
mindset. It could help companies figure out why their employees are
thinking in such a direction," says Sinha.
In India, sectors like infrastructure and banking - where new players
are entering the field - will continue to suck in talent. In infrastructure,
nearly $1 trillion of investment has been planned in the years to 2018.
With half of this expected from private financing, there will be huge
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demand for labour in India's finance, insurance, real estate and
construction sectors - totalling 14% of employment in the organised
sector - and raising turnover in these activities, as Sinha points out.
Besides, there is a huge demand for ready talent, he says.
But not everyone thinks it is a function of external growth conditions.
"The best insurance against attrition is not to hope for lack of
opportunities outside but to build strong internal conditions which act
like a glue to employees," says Divakar Kaza, president, HR, Lupin
Pharma.
The study seems to support this. Nearly 55% of Indian employees
expressed concerns about the fairness of their compensation and the
extent to which benefits meet their needs (48%). One in every three
employees expressed concern over a lack confidence in being able to
achieve their career objectives with their current employers (37%); as
a result, they are concerned about opportunities for learning and
development (39%) and supervisory coaching for their development
(36%).
An analysis of Hay Group's employee opinion database, covering 5.5 m
employees worldwide, threw up the most consistent predictors ofemployee engagement and commitment: confidence in leadership; an
opportunity for career development; autonomy; supportive work
environment; and appropA significant number of Indian employees
have expressed concern over their firms' ability to provide the five
retention factors - especially when it comes to the opportunity for
career development, says Hay Group's Sinha. "Organisations need to
give serious thought to how they stack up against these factors now -
before the job markets begin to improve. Those who don't are likely to
find employees exiting in increasing numbers as more opportunities
become available," he says.
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However, not everyone is buying the study's findings. "I am surprised
to know we will see this kind of employee turnover in India because the
GDP has declined to 5% and employees have till now stuck to their
companies due to job security issues and the lack of new opportunities.
The turnover might be voluntary," says Adil Malia, group president, HR,
Essar Group.
Worldwide, average employee turnover rates over the next five years
are predicted to rise to 23.4% and the number of global departures in
2018 is expected to be at 192 million. Turnover rates are forecast to be
higher where market prospects are better - so employees in emerging
markets will continue to have opportunities and be among the first to
take flight.
riate compensation.
Attrition rate falls down to 15-20% in IT-BPO sector:
ASSOCHAM
The apex industry body, the Associated Chambers of Commerce and
Industry of India (ASSOCHAM), has reported that the attrition rate in IT-
BPO sector had fallen drastically. According to the body, the level ofattrition has come down to 15-20% in the last six months for the year
2012 when compared to the 55-60% attrition rate in same period
during the year 2011.
As per the recent survey carried out by the apex body, the level of
attrition rate has been falling by 45-50% from period of January to June
mainly due to the downturn in the global economy. According to the
report, slow growth of the economy coupled with weakening rupee
against dollar has made the employees in the BPO sector to adopt a
wait and watch policy before moving out from the current job position.
Nevertheless, this policy adopted by the employees proved to be a
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boon for the IT/ITES as the sector has been grappling due to talent
shortage in the middle and senior level management.
The industry body as part of their survey interacted with consultants,
HR professionals, psychologists and managerial officials of various
companies from six leading centers of IT-BPO sector in India. Many of
the respondents gave economic slump as the reason for the slowing
down of hiring activities and increasing retention rate at all levels of
management in BPO companies. They further said that the slowdown
has been also forcing the other companies to consider only a mere
hike in the annual appraisal season which doesnt have much incentive
to employees looking to jump from current jobs.
Most often, attrition in the IT-BPO sector happens mainly in quest of
High pay packages
Better career opportunities and growth prospect
Better management relationship and Avoid performance pressure.
But, according to the survey, decline in attrition rate will prove to be
fruitful for the companies which are struggling as expenses incurred on
recruiting new staff and training them on the skills sets has fallen
considerably.
According to ASSOCHAM, the fall in attrition rate is beneficial as
frequent change in the job can be fatal for the growth of the BPOsector in India. The report claims that high attrition rate affects both
the companies that pay high pay packages and for the individuals
receiving those high pay since high pays do not raise the level of skills
and talents of the individuals.
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Further the report also discusses that the attrition rate is maximum
among the entry level employees due to their aspiration for hefty pay
packages, whereas the rate is minimum i.e less than 5% for the
employees having work experience for more than10 years. The rate of
attrition is 7-10% among the employees having experience between 5-
10 years.
However, according to the report, the companies are planning for
salary hikes and promotions to keep a check on the attrition rate and
to further lower the current rate.
OBJECTIVE OF THE RESEARCH :Primary Objective:
A Study on attrition in IT industry
Secondary Objective:
To know the major reasons for employees to leave their jobs.
To evaluate how an employee is valued as a part of this office.
To study whether the promoting respect and fair treatment among
all staff is a high priority of this office.
To find whether the communication between staff and management
is effective.
To study whether the workload in this office is distributed equitably.
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To evaluate whether the employee know exactly what is expected
of him/her as an employee.
RESEARCH METHODOLOGY
Research methodology is a science of studying how research is done
scientifically. Methodology helps to understand not only the products
of scientific inquiry but the process itself. Aims to describe and analyse
methods, throw light on their limitations and resources, clarify their
presuppositions and consequences.
Research Design:
This research is of descriptive. In descriptive research, we have
sufficient data on the concept and research material. Because many
research have been done on the same concept. Therefore, nothing new
is in this concept while I am going to study. I have used questionnaire
method for collecting data.
Sources of data:
The data used in this research involves both primary and secondary.
Primary data:
Primary data are directly collected from the original sources. The
primary data is collected in the form of responses from the employees
using survey method.
Secondary data:
Secondary data is the data that has already been collected by
someone else for a different purpose of yours.
Sampling Techniques:
Sample Unit:
The sampling unit is IT industry, MumbaiSample size:
My sample size is 20.
Tools used for data collection:
Questionnaire:
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A questionnaire is sent to the person concerned with request to
answer the question and return the questionnaire. A questionnaire
consists of a number of question printed or typed in a definite order on
a form. The respondents have to answer the question on their own. I
have used like scale which consists of 10 question and respondents
have to answer for the questions asked.
Tools used for Analysis:
Statistical tool:
Percentage Analysis:
Percentage analysis is the method to represent raw streams of data as
a percentage for better understanding of data collected.
Chi-square Test:
The measure of chi-square enables us to find out the degree of
discrepancy between observed frequencies and theoretical frequencies
is due to error of sampling or due to chance.
ANALYSIS:
Survey research was conducted for the collection of data from a
representative sample of Mumbai employees in IT industry.
The data collected have been analysed.
The age-wise classification of the respondents is depicted in the table.
Age wise Percentage No. of respondentsBelow 22 [45%] 922 24 [20%] 425 27 [15%] 328 30 [10%] 2
Above 30 [10%] 2
Interference:
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From the above table, it is interfered that 45% of the respondents are
of age below 22, 10 % of the respondents are of age group 28 30 and
above 30.
The table showing whether the office has policies that are supportive
to its staff.
Opinion Percentage No. of respondentsStrongly agree [15%] 3Agree [20%] 4Neutral [30%] 6
Disagree [10%] 2Strongly disagree [25%] 5
TESTING OF HYPOTHESIS
The hypothesis assumed in the study has been tested with help of chi-
square test.
The formula used is X2 = (O-E)2/E
Age of
the
responde
nt
The office has policies that are supportive to its
staff
Strongl
y Agree
Agree Neither
Agree Nor
Disagree
Strongly
Disagree
Disagree
Below 22 1 2 3 - 3
22 24 1 - 2 - 1
25 27 1 1 1 - -
28 30 - - - 1 1
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Above 30 1 - - 1 -
The expected frequencies can be calculated using the formula.
Expected frequency = ( Row Total x Column Total) / Grand Total.
The expected frequencies are,
Age of
the
responde
nt
The office has policies that are supportive to its
staff
Strongl
y Agree
Agree Neither
Agree Nor
Disagree
Strongly
Disagree
Disagree
Below 22 1.8 1.35 2.7 0.9 2.25
22 24 0.8 0.6 1.2 0.4 125 27 0.6 0.45 0.9 0.3 0.75
28 30 0.4 0.3 0.6 0.2 0.5
Above 30 0.4 0.3 0.6 0.2 0.5
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When applying X2,
O E O-E (O-E)2 (O-E)2/E
1 1.8 -0.8 0.64 0.35
1 0.8 0.2 0.4 0.5
1 0.6 0.4 0.16 0.26
- 0.4 -0.4 0.16 0.4
1 0.4 0.6 0.36 0.9
2 1.35 0.65 0.42 0.31
- 0.6 -0.6 0.36 0.6
1 0.45 0.55 0.30 0.67
- 0.3 -0.3 0.9 0.3
- 0.3 -0.3 0.9 0.3
3 2.7 0.3 0.9 0.33
2 1.2 0.8 0.64 0.53
1 0.9 0.1 0.1 0.1
- 0.6 -0.6 0.36 0.6
- 0.6 -0.6 0.36 0.6
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- 0.9 -0.9 0.81 0.9
- 0.4 -0.4 0.16 0.4
- 0.3 -0.3 0.9 0.3
1 0.2 0.8 0.64 0.321 0.2 0.8 0.64 0.32
3 2.25 0.75 0.56 0.24
1 1 0 0 0
- 0.75 -0.75 0.56 0.74
1 0.5 0.5 0.25 0.5
- 0.5 -0.5 0.25 0.5
Total 10.97
Calculated Value = X2 = (O-E)2/E
X2 = 10.97
Degree of freedom
= (r-1) (c-1)
= (5-1) (5-1)
= (4) (4)
= 16
Level of significant = 0.05
Table value of 16 = 26.30.
Conclusion:
The table value of X2 for 16 d.f at 0.05% level of significance is 26.30.
The calculated value of X2
(10.97) is less than the table value. Thus H0is accepted. Thus, there is no relationship between the age of the
respondents and the office has policies that are supportive to its staff.
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FINDINGS:
It is found that most of the respondents leave the job due to
work stress and few respondents leave their job due to continue
their Higher Education.
It is observed that the respondents agree that the employee is
valued as a part in his office and few of the respondents
Disagree that the employee is valued as a part in his office.
Most of the respondents agree that the employee are fairly
treated and respected and few of the respondents Disagree that
the employees are fairly treated and respected.
It is found that most of the respondents Agree that the employee
have a clear sense of future direction in this office and few of the
respondents Strongly Disagree that the employee have a clear
sense of future direction in this office.
Most of the respondents Agree that the office has policies that
are supportive to its staff and few of the respondents Disagreethat the office has policies that are supportive to its staff.
It is observed that most of the respondents agree that the work
load in this office is distributed equitably and only few of the
respondents Disagree that the work load in this
office is distributed equitably.
Most of the respondents Agree that the employee exactly know
what is expected from his/her as an employee and only few ofthe respondents Disagree that the employee exactly know what
is expected from his/her as an employee.
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SUGGESTIONS:
Working conditions should be improved.
Employee should be valued as a part in his office.
The communication between the staff and the management
should be effective.
The office policies should be supportive to the employees.
Workloads in the office should be distributed equally.
There should be a regular staff meeting conducted by the
management.
Employees should be given constructive feedback about the
work performed.
CONCLUSION:
To conclude, IT firms need to understand that now, the case is not
about giving more salaries and preventing the employees from leaving.Employees need much more than what is obvious. A long-term
relationship needs to be established with its employees.
Moreover, employees in this sector need a lot of personal space and a
well thought-out career growth plan. Also, HR practices are needed to
be fine-tuned so as to get the right kind of employees. Some of the
strategies suggested in this paper can be very easily implemented
without any cost to the company.Some other strategies are not so easily implantable, but are very
important for the growth of this sector, and are necessary for