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Attrition

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Activity:  10 comments  732 views  last activity : 12 25 2010 19:17:32 +0000
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HR Heads are worried about employees leaving their organizations. Not only is it costly to lose trained employees, but their replacements are not easy to come by. Hence, the HR strives hard to keep attrition at the minimum.

Greg Weiss, an HR Consultant and Principal of Humanagement, in extensive interviews with HR Directors at 30 companies, found that most companies have little real understanding of why employees leave. (Source: Article on www.zdnet.com.au)

Cite HR Poll: I came across a public poll that was conducted at Cite HR (a popular meeting point for HR professionals) to find the opinion of the HR community on the reasons for attrition. The poll was titled 'Who will be held responsible for attrition?', and participants had to chose an option responsible for attrition. The options were: -

1. Employee
2. Supervisor or Line Manager
3. Compensation & Job Profile

The Poll Results: The HR community welcomed the poll and a large number of them participated. The results of the poll on a specific date were as follows (The poll still continues and numbers of voters have increased; however, the result remains more or less the same): -

Reason for Exit% of Respondents
  Employee08.03%  
  Supervisor or Line Manager38.15%  
  Compensation & Job Profile53.82%  

Analysis of the Poll Results: The results of the poll are very interesting and can provide deep insights into why attrition happens and what may help solve it.

Employee as a Reason for Attrition

Only 8% HR professionals felt that employees leave organizations on their own. Except in a few cases, such as personal reasons, family issues, location preference, company brand, and peer relationships, employees are not self-motivated to leave the company they are working in.

Nevertheless, it is important to find out common causes for employee initiated exits, where supervisors and/or Job Profile / compensation are not the cause.

Employee Satisfaction Surveys are the ways to identify such areas of dissatisfaction, one of which may be HR policy guidelines of the company. If you conduct these surveys on a regular basis and map their results to exit interviews; new findings may identify critical gaps in how the employees perceive your policies. Very important trends can be identified by regular surveys conducted over the period of 1-2 years. These can also help define future HR guidelines with minimal disruption and dissatisfaction.

There are a number of survey tools available in the marketplace and one such popular tool is the Employee Satisfaction Survey available in EmpXtrack. It helps integrate various aspects of HR to give more meaningful results.

Supervisor or Line Manager as a Cause of Attrition

A large majority of HR professionals polled that immediate managers are a bigger reason for attrition. It confirms Wayne Hochwarter (an Associate Professor of Management in the College of Business at Florida State University) Theory that, "Employees don't leave their job or company, they leave their manager".

Meeting employees' expectations is a difficult task, and most managers cannot do it effectively and consistently. 'Satisfying employee needs' often gets lower priority in a manager's quadrant of activities. Further, managers do not have appropriate tools to manage employee-related tasks and this leads to further dissatisfaction.

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

Compensation & Job Profile

HR Managers voted unanimously that 'Compensation & Job Profile' are the primary cause of attrition. With a war for talent, disparity in the compensation packages is bound to occur and a mis-matched job profile increases the likelihood of an exit.

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.

Every company wants to become the 'best paying employer', but market forces, tough competition and a slow economy dictate otherwise. A fair and transparent compensation policy can still be adopted where each employee gets his/her dues based on company, team and individual performance.

If your employees are convinced that they are compensated in direct proportion to their productivity, you have won half the battle. The other half is won when each individual is assigned SMART (Specific, Measurable, Achievable, Reviewable & Time Based) Goals, and you can cascade these from organization objectives.

 Top Comment : Gargi Sinha   | 03 23 2009 14:07:27 +0000
Nice information Swathi, gr8 research. And I too agree that employee leave the organisation because of Compensation & Job Profile ( mostly the entry level or middle level employees whose 1st and foremost motivator is money, money). Sometimes managers are also responsible but I still believe money/compensation is the main reason.
 
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10 comments on "Who is Responsible for Attrition?"
  Commented by  Sunil Anil Wadekar    | 12 25 2010 19:17:32 +0000
Yes Swathi Madam,
I fully agree with the article. I have extremely bad experience on same grounds with one of the organization whose HO location is at Chennai. The parent company is located at Illionis. Due to extremely high attrition rate ( reason best known to that company's HR dept. and others who have suffered drastically only like me ), the said organization is now procuring 2 years non judicial bonds by every new joininees irrespective of his experience, knowledge and educational qualifications. Really they donot have any base to appoint new aspirant. For whatever reason,they appoint new person at any location in their territory at all times in the year and spoiling name of parent company literally. They have got vacancy at 24/7 for 365 days in the year and this can be confirmed by advertisemetns in either newpaper or naukri.com or by reference with existing employees who has got personal vested interests from the company. To punish the leaving employee, they donot process his gratuity claim, delay full and final settlement, delay relieving certficate, donot process his PF application. I joined this company as this has got background of well known Group in India and tie up with world leader company ( names excused ), but failed to understand still the culture of the company. Personally, my almost more than INR 1.20 Lacs are blocked due to erratic behavior of this company HR dept. They even donot reply to requests. I donot know what to do to get this money from the said company. I have not taken yet but almost decided to take legal action against the said company. Anyway, thanks for confirming through the article that employees leave the company due to Company only. 
  Commented by  Kumbakonam S Venkataraman, Associate Editor, Dynamic Youth online magazine    | 12 14 2010 10:34:24 +0000
The main reason is compensation and job profile, though other factors no doubt add or mitigate attrition.
  Commented by  Bharath Kumar Ratakonda, Senior Executive, MGL    | 12 14 2010 09:28:01 +0000
Hi. Thats normal & understood by the saying of Nrayanamurthy that "people quit their bosses & not the companies". But people do quit because of organisation's policies & performance, politics, team dynamics too. Regards, Bharath R
  Commented by  KUMAR, HEAD-HR,MARKETING & CUSTOMER CARE, MARUTI SERVICE ZONE    | 09 25 2009 10:45:59 +0000
It is a common phenomenon specially in the call centre industry than any other. However attrition can have possible solutions like getting down to bond and ext interview properly.
  Commented by  Shazia Begum, Technical Recruiter, High Points Technologies Pvt Ltd    | 09 12 2009 09:34:04 +0000
Only manager is responsible for employee Attrition, because if an employee is facing any problem in an organisation only he has rights to solve it,because he is decision-maker. According to me mangers should not try to cheat employees by over praising them as if they care a lot, they should treat all employees as one, not "kits and kins"(Favoritism) should be done by him.I hope all of you have noticed few managers do favor to those who do postmaster job inorganisation,like giving ones info to one and other to other.I hope those people should be named as corporate Postmasters.
  Commented by  Swathi Reddy, Deputy HR Manager, GMMCO Ltd-Hyderabad    | 03 25 2009 08:50:38 +0000
Rating : +1 
Very true Chayya, totally agree with you..this happens when the Managers operate with their personal interests and egos..the organisation looses a good resource.
  Commented by  Chhaya Chandrasekhar, Program Manager, -    | 03 25 2009 06:29:01 +0000
Rating : +2 
All said and done thru ads and speeches that employees are the assets of the company. During the exit interview, the reasons are noted but what happens next is never known. The managers responsible for the exit of the employee still continues to shine. Its more a game of politics then working for an organisation.
  Commented by  Nitin M Aras, Head/VP/GM-Tech. Support, Wintech Taparia Limited    | 03 24 2009 08:10:10 +0000
Rating : +1 
Very true Swathi. Nice information shared. It is true that employee leaves their manager not organisation. Manpower is a critical resources and very delicate to handle, most of the managers fail to handle them. Manager has to understand different dimensions of grievance handling methodology.Since manager is also a human being, hence this is handled by HR dept. 
During exit interview, normally people blame on managers and incentives given by company, whereas it is not exactly a reason, they feel uncomfortable because of their skills and non-adaptability nature.
  Commented by  Raghu Kastury, CTO/CIO, Freelancer    | 03 24 2009 06:26:54 +0000
Rating : +1 
Good article. I am not an expert on HR, but I think we need to add one more "Reason for exit" or "Reason for continuing" we should say.

That is clarity of company's culture, vision and mission that matches perfectly in writing & action, both before an employee signs the contract and after the employee joins the company. What I mean is that many people join a company because it's a bluechip company - Not only because of compensation and job profile. But most of the places, when employees find the companies do not walk the talk, they leave silently. So whoever is the reason to create such an impression in the minds of employees, all those people should be held responsible - Designer of the culture and value system, implimenters and care takers of that value system and finally all those who believe in it and uphold the company's mission.
While designing the company's culture, which ever the company takes pride in keeping employee in the center and work for it, as well as keeps enough provisions to minimise inequaities based on trivial aspects to the business, and the organizations which continuously takes the feedback and corrects itself periodically will always have much less attrition.
  Commented by  Gargi Sinha, Senior Consultant, Hewitt Associates    | 03 23 2009 14:07:27 +0000
Rating : +1 
Nice information Swathi, gr8 research. And I too agree that employee leave the organisation because of Compensation & Job Profile ( mostly the entry level or middle level employees whose 1st and foremost motivator is money, money). 

Sometimes managers are also responsible but I still believe money/compensation is the main reason.
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