IT COMPANIES BATTLE RISING ATTRITION AMID DEMAND UPTICK

It is now common knowledge that most Organisations have reported higher attrition over the last few months.

Business Standard quoted the following figures:

1. India’s second largest IT services company, Infosys’s attrition rate in July-September 2013 was highest in more than six quarters. It saw an attrition rate of 17.3% in July-September 2013, as against 15.0% a year ago, and 16.9% in April-June 2013
2. HCL Technologies saw a sharp rise in attrition rate during the quarter. The company’s attrition rate for the quarter ended September 30, 2013, was at 16.1%, as against 14.% a quarter ago
3. The country’s third largest IT exporter, Wipro also saw a jump in attrition rate at 15.4% in July-September 2013, as against 13.0% in April-June 2013.

Read the whole article here: 

http://www.business-standard.com/article/companies/it-companies-battle-rising-attrition-amid-demand-uptick-113111000468_1.html

Experts believe that the attrition rate is expected to rise in the coming months driven by a number of factors. This should not come as a surprise especially since Attrition generally tends to increase when demand picks up.

Most companies view attrition as a reflection of Employee engagement; Higher attrition meaning unhappy employees and the converse.

However, this is not entirely true; attrition could be low but doesn't necessarily mean that the employees are engaged and happy. It’s just that they are waiting for an opportune moment to leave the company and when demand picks up employees leave in hordes.

Organisations will now go back and start believing that employees are leaving because they are getting a better salary!! In one of my earlier posts I spoke about how “Salary most often is an outcome of the exit and not a reason”. Employee engagement is a continuous activity and should not be impacted by market conditions. Organisations have a moral responsibility to take care of all their employees once they are hired irrespective of how Attrition is behaving.

Employee attrition always hurts any organization.  It must be viewed independent of an organization’s ability to withstand or succumb to attrition pressures as a reflected in key health indicators of business and momentum of the industry

Attrition will pick up when the demand increases but that doesn't mean that companies who engage well with their employees go through the same challenges. At the end of it, it is about how the employee is taken care of.

It is equally important to identify the root causes of attrition and not believe that they are because of Salary & better prospects. Action based on data will always produce better results that actions based on Gut feel or Hearsay .

ATTRITION FACT 08/10/2013

Common sense will tell you that the employees in any organisation are the biggest and possibly the best source to attract talent . However, we continuously hear of the internal employee referral programs don't work.

So why do most employee referral programs fail  ?

While i could list a few , the biggest reason almost always boils down to lack of rigor & discipline in rolling out the program.

Most companies today have approximately 5% to 20%  of their employees hired through an employee referral while a good average should be around the 50% mark .

THE NEED TO RETAIN SEASONED PROFESSIONALS

THE NEED TO RETAIN SEASONED PROFESSIONALS

A seasoned professional in organization will necessarily have most of these characteristics -   He or she would have been a tenured employee, would have played different roles in the company across functions and business units, would consistently meet organizational and business goals, have personal rapport with many of the colleagues at different levels in the organization, have a knack of getting things done quickly within the company, fiercely protect the brand image of the company internally and externally and last but not the least create successors behind in places they vacate.

If there is one thing that is and will always be critical to an organisations success,  is the need retain seasoned professionals.  Listed below are the reasons why it becomes important to retain these employees:

   Seasoned professionals contribute significantly to organisations goals

These employees having been in the organisation for a significant period of time and normally exceed their targets on a consistent basis. When they leave it creates an impact on the team’s performance.

To compound the problem, these employees will always get replaced by fresher’s who will take a significant amount of time come up the learning curve. During this period the pressure gets transferred to the existing team members who may end up being disgruntled.

   Seasoned professionals are brand ambassadors of the organisations

These employees having worked in the organisation for several years tend to represent the organisation. New joinees look up to them and they most likely have a huge influence on the morale of the team. Positive behaviour always creates a positive work environment

    Seasoned professionals make excellent buddies & mentors

When new employee joins, it’s always good to have him/her buddied up during their first couple of months in the organisation. This would help the new employee feel more comfortable as he has continuous support. This lends itself to increased employee engagement and a reduction of early attrition. The seasoned professionals having been in the company for a few years know the wherewithal to be able to guide the new employee on a personal & professional front

 

    Seasoned professionals have excellent relationships with the Clients

Most clients tend to build relationships with employees and appreciate loyalty. When a seasoned professional leaves the clients tend to get concerned as they would be required to rebuild the trust & confidence with another employee. This process naturally takes time and during this period, there could be several anxious moments for the organisation and CSAT levels may drop.

HOW TO RETAIN SEASONED PROFESSIONALS?

   Challenge them :

Seasoned employees love to be challenged and are especially kicked about challenging assignments handed down by the very senior leaders in the company.  For them, the assignment in itself is both recognition and a reward.

   Create a learning environment

A continuous process of Learning & Development is something that all seasoned employees want. While they may be happy with their role, it’s important for them to feel that they are learning something new on an ongoing basis. They should be sent for training programs and exposed to new technologies to keep them engaged.

   Keep them engaged

Seasoned professionals need to be given continuous attention. Their managers should seek their feedback on improvement areas as their contributions can be valuable. Rewards, recognition and a pat on the back can go a long way in keeping them motivated.

Regular and frequent exchanges with the senior leaders both formal and informal, goes a long way in fuelling the continued urge to succeed in their roles

   Provide additional roles & responsibilities

Managers should consciously delegate work to the seasoned employees and ensure they are offered opportunities where they can leverage their experience to groom other employees. These employees should be given an opportunity to grow by providing them practical learning experience.

   Reward Loyalty

With attrition being one of the biggest challenges that organisations face today, it becomes extremely important that Organisations ensure that loyalty is rewarded.  Rewards can be in the form of cash, certificates, trophies & medals or special benefits such as a flexible work timings, work from home options ( on certain days of the week) etc.

Special treatment of some kind may also be a sponsored educational course, a holiday for the family, aid or support to a social cause they feel strongly about, makes their continuance in the company even more worthwhile.

The need to retain seasoned employees is very clear and simple.  Unless a random employee accidentally becomes a seasoned employee quickly, only seasoned employees can create more seasoned employees.

First Day at School

My son started going to a new school a few  days back and was going through separation anxiety. He repeatedly kept telling us that he wanted to go home and that he could start the next day etc.
He was crying until we reached the school gate at which point one of his teachers took him from us and asked us not to worry. The teacher looked pleasing, confident and most importantly reassuring.
My wife and I waited anxiously till 1pm to pick him up and were very curious to see how he was faring, at 1pm we saw him walking out of school, towards the gate, holding his teachers hand and to our delight, with a big smile on his face. The teacher also told us that our son is a very good boy
Phew…..
What my son went through is am sure relatively similar to what every new employee goes through in his Day 1.  The question is does every employee walk out with a smile on his face??
The teacher paid attention to the smallest details, ensured hand holding and also gave a lot of positive reinforcement. So can organisations cant they?

Five simple rules to improve Day 1 experience:
1.Make sure that the  employee is welcomed on day 1 as soon as he/she enters the office building
2.Ensure that the employee feels warm and welcome as he is taken around the work place.
3.Introduce him/her  to as many of his colleagues as possible
4.Ensure that he/she is given company while he/she is having lunch on day 1.
5.One on One with the Manager

Pretty basic stuff but will go a long way in ensuring that the employee walks out with a smile at the end of the day and there is enough data that tells us that employees who have a great Day 1 tend to stay on at the organisation for a much longer time.

Stay Surveys

With the market looking up and attrition numbers gradually increasing, more and more companies are looking at what is causing their employees to leave.

While the best way to understand the root cause of attrition is to have a heart to heart conversation with the attriting employee, it would also extremely useful to talk to employees while they are in the company to identify if there is a potential threat and to recognise strengths that the company should focus on.

These surveys are popularly called ‘Stay Surveys ‘. Several proactive HR heads are having their employees participate in these Stay Surveys to understand employee experience and to get an idea of what makes the employees tick.

The typical questions that are asked are:

·         Why do employees stay (manager, culture, rewards, job content etc.)? 

·         What does the employee like best about the job, co-workers, and management? 

·         What challenges/excites the employee? 

·         One thing that the employee would like to change

·         If the employee ever considered leaving, what would be the trigger that would make the employee look out?

Stay surveys tend to focus on the strengths of the company while Exit interviews focus on what causes employees to leave. A combination of both will enable organisations build a comprehensive retention strategy.

The surveys can be conducted using an external agency or done internally by training managers, to conduct them. Irrespective of the approach, the need to conduct these surveys is very important and is a critical part of building superior retention strategies and to improve Overall Employee Engagement .

Low Attrition yet high Disengagement

A couple of years back when attrition was at its peak most organisations were struggling to find out why people were leaving and till date have not been able to figure it out...With the economic downturn Companies breathed a sigh of relief as attrition was not a cause for a concern anymore. Little did they realise that the problem is far greater now than before.


In the past disgruntled employees would leave and find jobs at other companies. However based on several surveys that we have done recently, it is evident that there is a bigger problem on hand. The problem being disgruntled employees not quitting. So now companies have an added problem of poor performance and morale.High performers continue to get jobs thereby the percentage of disgruntled Cat B performers is on the rise.


Companies ought to realise this and ensure that they pay attention to Employee Engagement at this crucial time inspite of the fact that Attrition may be low. In the past Attrition was a reflection of the general satisfaction level of the employees, not anymore.

Companies may face heat for layoffs, salary cuts

Companies that sowed the wind with harsh measures such as layoffs and pay cuts during the economic slowdown should be prepared to reap the whirlwind in the form of major difficulties in hiring and retaining staff as growth gets back on track.


Employee churn has picked up significantly in the past three months in several businesses and HR experts said how companies treated staff during the tough times would be a key determinant of attrition levels and the fabric of employer-employee relationships.


Among those left sadder, wiser and bitter because of the experience with an employer during the downturn is a senior official who left a top FMCG company to join a leading retailer on a 50% higher salary. Within nine months, the retail firm scaled down expansion plans and transferred him to a remote location without any warning. Pushed to a corner, he quit and rejoined his former employer.


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