The Reasons for Attrition
In recent months, there has been a spate of news items about how
attrition is taking its toll on many organizations in Asia and
especially in the IT sector in India. Whereas in the west, because of
the recession and the gloomy economic conditions, attrition is no longer
an issue and instead, layoffs are the order of the day, in relatively
better performing Asian countries, attrition has come back to haunt the
companies. There are many reasons for attrition and usually research
has shown that the most cited reason is that the employee is unable to
get on with his or her manager. The adage that employees leave
managers rather than organizations is a favorite catchphrase among
management experts and organizational behavior theorists. Having said
that, it must be remembered that attrition is also because of other
factors like employees being unhappy with their salary or the raise that
they get after the appraisal period. Further, attrition can also be
because employees perceive that the current organization is not doing
well and hence, they are on the lookout for better performing peers and
competitors. Apart from this, attrition is also because employees find
jobs in other companies that are more fulfilling and match their skill
sets and profiles.
The Red Lists and Risk Management
After analyzing the reasons for attrition, it is time to look at how
companies and the HR managers can manage attrition. In many
organizations, managers are asked to identify potential cases of
attrition before the employee actually puts in his or her papers. For
instance, many multinationals have the practice of asking their managers
to prepare lists of potential employees who are likely to quit. This
“red list” is then sent to the managers’ supervisor and the HR manager
so that when the employee actually quits or even does not quit, the
organization is prepared for the quitting event or counseling the
employee against quitting. The latter scenario happens when the employee
is deemed valuable to the organization and the manager identifies such
attrition as being a loss to the company. Further, attrition is also
managed by the HR department organizing periodic one-one sessions with
the middle management and the managers having the same one-one session
with their employees. The rationale for such sessions is that the
employees would vent their frustrations or lack of comfort with the
manager or with the organization and hence, ways and means can be found
to address the employees’ concerns.
Some Real World Case Studies
Attrition has become a challenge for companies like the Indian IT
major, Infosys that has seen unprecedented attrition among its employees
in recent months. The situation has deteriorated to the extent that the
company is having to address investor and analyst queries about this
issue and has had to come up with a plan to tackle the same. The point
here is that attrition in well-known companies affects their brand value
and their brand image and considering the fact that companies like
Microsoft and Unilever as well as P&G are respected globally for
their HR practices, attrition in these companies dents the carefully
crafted image of being people friendly. This is the reason why the blue
chip companies take attrition seriously and to the point where Steve
Balmer (the former head of Microsoft) is reported to have gone through
all the exit interview forms of the employees.
Concluding Thoughts
Finally, attrition is also economically damaging to the organizations
as the replacement employees have to be hired at a cost and trained
again at a cost. Further, losing employees who are well versed with the
organizational culture can mean a loss of valuable resources that lead
to a situation where the organization stands to miss the potential value
adding activities of the employees. It is for this reason that HR
managers and organizations take attrition seriously and consider ways
and means to curb the same.
