UNIVERSITY OF MUMBAI

A PROJECT ON
ATTRITION

SUBMITTED BY
Ayyangar Nisha Jagannathan
TYBMS V​th​ SEMESTER

PROJECT GUIDE
Mrs Swati Nalawade

YEAR (2007-08)
S.I.E.S (Nerul) college of Commerce
Sri Chandrasekarendra Saraswathy Vidyapuram,
Plot 1-C, Sector V, Nerul, Navi Mumbai-400706

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ACKNOWLEDGEMENT

The successful completion of this project was a result of the kind co-operation &

guidance I have received from various persons & institution. Though I would like to

acknowledge them individually I mention below only few though the contribution from the

rest was of no less importance.

Firstly I thank the S.I.E.S (Nerul) college of Arts, Science and Commerce, and the staff

of the college for having given me this opportunity to do this project and providing me with

the required advice and guidance.

I specially thank my project guide ____________________ for sparing her valuable

time and effort to give me the necessary information and clearing my concepts regarding my

topic and completing this project successfully.

Finally I am grateful to my friends and many other Call center employees for providing

me with the information by responding to the survey conducted by me.

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CERTIFICATE

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DECLARATION

I, ​NISHA JAGANNATHAN​ OF S.I.E.S (NERUL) COLLEGE OF ARTS, SCIENCE

& COMMERCE HEREBY DECLARE THAT I HAVE COMPLETED THE PROJECT
ENTITLED ​ATTRITION​ IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR
THE THIRD YEAR OF THE BACHELOR OF MANAGEMENT STUDIES COURSE FOR
THE ACADEMIC YEAR 2007-2008.
I FURTHER DECLARE THAT THE INFORMATION SUBMITTED BY ME IS
TRUE AND ORIGINAL TO THE BEST OF MY KNOWLEDGE.

DATE: STUDENT NAME:

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Sr. no. CONTENTS Pg.No.
01. EXECUTIVE SUMMARY 08.
02. OBJECTIVE OF THE PROJECT 09.
03. METHODOLOGY OF STUDY 09.
04. DEFINING ATTRITION AND PROBLEM 10.
05. REASONS FOR ATTRITION 12.
06. HOW TO HANDLE ATTRITION? 16.
07. HOW TO SAVE HIGH ATTRITION RATES? 23.
08. HOW TO CURB ATTRITION? 27.
09. COST OF TURNOVER 36.
10. ARTICLE: ​‘Attrition at Call Canters’ 47.
11. CASE EXAMPLE : ​'I'll never work at a call centre again!' 50.
12. WHY PEOPLE ARE LEAVING BPO’s? 53.
13. QUESTIONNAIRE ON ATTRITION 63.
14. CONCLUSION
15. BIBLOGRAPHY

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INDEX

EXECUTIVE SUMMARY

Human Capital is the most crucial resource on which the Information Technology &

Information Technology Enabled Services (IT & ITES) industry in India depends. Next to the

location advantage that India has, the factor for the country's immense success in the overseas

markets, is its abundant & cost effective human capital which is one of the key asset that has

kept India sustain its edge in the ITES sector Human Resource (HR) professionals all over the

world, working in Call-Center or Contact Center or BPO industry are leaving no stone

unturned to formulate strategies to retain human capital, but nothing is working in their favor.

In spite of all their trials the average attrition rate in the BPO this sector is still very high.

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 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 that entire turnover cost? And what employees are likely to have the

highest turnover? Who is likely to stay the longest?

OBJECTIVE:

The objective of this project is to understand the retention strategies adopted by

various Indian BPO companies (especially the call centers) and propose innovative strategies

that these companies can adopt to get a better solution to this Herculean problem that the BPO

industry is facing. Though the issues and options analyzed are with respect to Indian service

providers, the same may be applied to service providers across the globe as the issues and

options remain the same irrespective of place of operation.

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METHODOLOGY OF STUDY:

To know about retention strategies adopted by various Indian BPO companies

(Especially the call centers) the Internet and print medium like magazine and newspaper were

used in which the interviews of HR managers were published. The reason behind choosing

call center segment of BPO is, Customer care based call center activities constitute for more

than one third of the total employment and revenue in BPO segment.

DEFINING ATTRITION:

"A reduction in the number of employees through retirement, resignation or

death"

DEFINING THE ATTRITION PROBLEM:

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 Attrition is beginning to significantly affect offshore return on investment(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.

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%. while an April 2005 BusinessWeek article

estimated an attrition rate of 60%, with some Indian 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

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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. 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.

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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  are  many  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: 

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, 

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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  and  all,  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  as  being  temporary 

and  they  quickly  change  the  job  once  they get in to their own field. The other option is 

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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. The foremost  

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  examination  or  other  examinations and once they get cleared 

they quickly move out.  

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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  people  to  spread  message  and  refer  the 

know candidates from the previous companies and earn too.  

● Employee’s advocate:  

One  of  the  main  reasons  why  employees  leave  companies  is  because  of 

problems  with  their  managers.  An  HR  professional  can  be  termed  an  employee’s 

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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  company’s  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’ 

welfare…it  is  responsible  for  making  sure  that  their  expectations  are  met.  By  doing 

this it is easier to meet the company’s business targets. 

HOW TO HANDLE ATTRITION?

Earlier  the  retention  was  the  sole  responsibility  of  HR  Department  and  at  the 

most  the  department  heads  will  be  accountable  for  the  retention  of  talent.  In 

companies  the  wheels  have  changed  and  multi  dimensional  approach  needs  to  be 

adopted.  More  of  concerted  efforts  only  would  help  to  retain  the  talent. Everyone has 

to  contribute  to  hold  the  employees  little  longer  period.  All  the leading companies are 

trying  several  methods  to  retain  the  talent  and  few  of  those  innovative  HR 

practices(based on a survey) are:  

● Providing stimulating work environment: 

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In  terms  of  stated  work  pressure,  only  17%  have  claimed  ‘light  pressure’.  This  may 

point  to  a  reasonably high-pressure environment in conventional terms, not realized as 

most  respondents  have  no  other  industry  experience.  The  atmosphere  at  the 

workplace  however,  was  generally  positive.  Almost  half  worked  more  than  45  hours 

per week. 

● Free transport and free food: 

Majority  of  the breaks were for meals and there were no significant problems faced 

in taking the breaks. 

   

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Almost  2/3rd  employees  travel  more  than  10  kms  to  work  everyday.  This  is  a  huge 

strain  on  quality  time  available  with  the  family  and  ostensibly  results  in  stress  in 

numerous  ways  compared  with  other  industries.  The  root cause is that most BPOs are 

located outside the city as government lands have been allocated to the MNCs at better 

rates there. 

Although  taxi  /  bus  services  are  provided  by  most  employers, as many as 30% workers 

travel  crammed  (more  than  5  persons  to  a taxi). What’s more, 79% waste more than 30 

minutes  of  their  productive  lives  everyday  waiting  for  commute.  Interestingly,  lower 

salary workers get no such benefits. 

● Good rewards and recognition programmes: 

As  many  as  56%  admitted  to  being  asked  to  work  overtime.  44%  refused  the 

question  implying  that  conditions  are  created  such  that  all  probably  are  coerced  into 

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working  overtime.  The  oppressive  part  was  further  that  as  high  as  41%  claimed  to not 

having been paid for overtime. 

   

● Recreation  clubs,  Canteens,  Entertain  programmes  ,  fun activities with in the work 

area:  

Many companies have canteens though the quality of food is not great. 

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● Other practices include: 

- Promotions and salary increase on a regular basis. 

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-  Better  learning  opportunities,  Encourage  enroll  for  distance  learning 

programmes. 

- Regular holiday packages, gifts, outings etc​. 

All  the  above  activities are being undertaken to a greater extent or little more in 

all  large  Companies.  Surprisingly  the  attrition  rate  is  not  coming  down  in  any  of  the 

companies,  but  it  is  going  up  and  it  may  increase  in  the  coming  days.  This is a time to 

introspect  as  to  what  is  lacking  in  the  approach.  One  thing  is  missing  is  attention  to 

individual  needs.  Employees  have  varied  expectations  and  it  is  becoming  difficult  to 

understand  them  and  by  the  time  you  make  an  attempt  to  understand the expectation 

changes  and  it  is  still  becoming  difficult  to  meet  the  customized  demands  or 

expectations.  To  quote  an  example,  if  a  friend  leaves,  another  close  friend  will  also 

leave  and  he  will  lure  another  3-5  persons.  Moving  for  higher  education  and  marriage 

are  the  major  reasons  for  attrition.  To  tackle  these  will be impossible with any type of 

strategies  and  approaches.  The  HR  personnel  have  become  silent  spectators  and start 

hunting for new personnel to replace. 

The  broader  approach  is  to  bring  sanctity  in  the  recruitment  process  like 

demand  the  relieving  letter  from  the  previous  company,  have  non-hire  agreements 

with  the  companies  in  the  particular  area.  It  is  not  easy  to  bring  the  entire  company 

under  a  forum.  Nasscom  has  attempted  to  bring  out  certain  guidelines  on  the  matter 

and  the  impact  is  not  felt  yet.  The  MNC  culture,  high  salary  level  and  benefits  offered 

by them are the only two major aspect of attrition and no one can halt them doing so. 

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● 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  bridges  the  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 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. 

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The Insights Discovery System is a powerful workforce enhancement tool. 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   

- Reduce  the  impact  of  turbulence  and  organizational  transition  on  employee 

commitment and productivity. 

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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.  

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 

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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 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. 

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● 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  business  plans  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,  "It’s 

about  money."  Or,  they  dismiss  the  departure  matter-of-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 

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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.  Research  shows  the  reasons  for  employee  departures  are  (in  descending 

order):  

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' 

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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  departing 

employee'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.  

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, 

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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  company’s  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  company’s  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  BPOs.  The  youth should feel proud to be a part of the 

billion-dollar industry. 

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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.  This  communication  begins  right  from  recruitment.  In  cases  of 

peer  pressure,  an  employee  aims  to  join  a  well-known  company.  This  could  be 

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achieved  by  brand  building,  which  attracts  the  right  talent  and  helps  in  retention  as 

well. 

Understanding an employee’s 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 

32
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  industry  experts  point  out, 

feedback  can  be  got  in  two  ways—during  the  employee’s  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 

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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  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 

benefits—or  risk  losing  valued  employees  to  competitors.  Nonstop  evaluation  and 

benchmarking are "need to do" activities for IT managers. 

● Subsidize Education and Certification 

34
 

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,  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. 

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● 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  a  limited  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. 

● 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. 

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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 

résumés,  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  lacks.  A  Voice  & Data survey of the top 15 Indian 

37
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  on  what  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, days off might have 

been  more  attractive,  since  they  would  have  allowed  him  to  spend  time  with  his 

family. 

38
 

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  can  better  identify  potential  personality  clashes  that  HR  personnel 

may not spot. 

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 

39
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  

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  

40
 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. 

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  firm’s  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 

41
time  an  employer  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  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  highly 

transparent.  

42
 

1. Process Administration: 

Resignation Administration - 

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.  

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. 

2. Sourcing Costs: 

Agency expenses - 

The  cost  of  sourcing  a  successful  applicant  from  an  agency  may  be  one  of  the  largest 

single direct costs associated with recruitment.  

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 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. 

3. 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 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.  

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 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 the associated 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  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 

45
 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. 

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 - 

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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-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.  

47
 

The  second  effect  of  loss  of  productivity  occurs  when new hires join the organization. 

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 

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 

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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  can’t  meet  customer  expectations  through  lack  of  knowledge  and 

experience. 

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 

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 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.  

● 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 

50
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. 

● 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  employee’s  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. 

51
 

Article -   

‘Attrition at Call Canters’ 

The  evolving  BPO  industry has got the perplexing issue of managing human resources, 

says BHIMA RAO 

Attrition  of  employees  in  the  call  centre  industry  is  mind-boggling  and  it  is  creating 

havoc  for  the  industry  and  especially  for  the  HR  department.  The  attrition  rate  varies 

from  minimum  30  per  cent  to  a  maximum  90  per  cent  per  annum.  The  software  also 

saw  this  rate  till  the  incident  of  September  11,  2001.  I  wonder  why  the  attrition  rate 

was  not  so  high  in  any  other new industry like telecom, retail stores, banking etc. Who 

has  to  introspect,  how  much  responsibility  should  be  borne  and  are  we  collectively 

contributing directly or indirectly for the attrition.  

Attrition  is  not  a  new  problem  and  it  has  existed  earlier  and  will  continue  to  exist  in 

any  industry.  But  there  is  a  limit  for  every  thing.  The  call  center  industry  is  new  and 

every  one  is in a great hurry to make some thing or do some thing, become someone in 

the  sun  rise  industry.  The  government,  promoters,  management  team,  employees, 

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consultants,  media  and  so  many  others  play  a  major  role  in  developing  any  new 

industry and extend helping hand for stabilization and finally growth of the industry. 

Our  country  is  fortunate  to  be  identified  as  one  of  the  best  places  for  BPO  and  the 

beginning  is  really  good.  Now  the  growth  of  BPO  industry  is  mainly  depending  on the 

cost  effectiveness  and  quality  of  the  manpower.  All  other  factors  are  being taken care 

by  the  government  through  liberalized  laws,  providing  infrastructure  like  telecom  and 

we  are  best  in  the  IT.  The  cost  effectiveness  will  depend  mainly  on  controlling  the 

running  cost  and  quality  is  dependent  on  the  manpower  employed.  Attrition  of 

employees  increases  the  cost  of recruitment and training. It has impact on maintaining 

the  quality  and  competent  manpower  to  meet  the  standards  set  by  international 

customers. 

● Four reasons why youngsters quit BPOs 

What  drives  young  people  to  quit  call  centres  and  data  processing  units  as  fast 

as  they  join them? As industry attrition rates (how soon people quit jobs) climb as high 

as  80  percent  in  some  companies,  human  resource  executives  in  various  BPO  firms 

tried  to  pinpoint  the  reasons  that  make  young  people  between  the  ages  of  22  and  26 

shuffle  jobs  in  months.  They  were  participating  in  a  seminar  on  key  HR  issues  for  the 

BPO industry in Bangalore today. This is what they came up with. 

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1. BPO not seen a long term career 

"This  industry  is  still  not  being  accepted  for  a  long  term  career,"  said  Mphasis  BPO 

Services' hief human resources officer Manab Bose.  

2. High aspirations that the industry cannot meet 

BPO  employees  have  high  aspirations.  They  want  to  see  'wealth'  in  this  lifetime  and 

have  low  respect  for  authority.  This  is  because  most  BPO  employees  have  immense 

family support. 

3. Good talent is prone to poaching 

ICICI  OneSource  President  and  CEO  Raju  Bhatnagar  said  the  pulls  of  the  market 

(poaching  by  competitors)  cannot  be  countered  easily.  BPO  firms  try  to  pick  the  best 

talent,  he  explained,  and  good  talent  is  prone  to  be  poached  or  to  shifting  jobs.  He 

suggested  that  firms  should  instead  look  at  the  average  person,  train  and  retain  him/ 

her for the longer haul.  

4. Employees face pressure at home and at work 

Philips  Software  CEO  Bob  Hoekstra  felt  BPO  employees  are  in  a  piquant  situation, 

having to handle pressure both from their customers and at home. 

54
"There  is  an  enormous  conflict  in  age  group  [​in  terms  of  the  fact  that​]  youngsters  are 

serving mature customers, and they are prone to make mistakes," he said. 

CASE EXAMPLE 

'I'll never work at a call centre again!' 

Subhash Mukherjee | ​November 18, 2004 

The  BPO/ITES  sector  is  only  expected  to  grow  larger,  and  more  profitable,  over  the 

next  few  years.  Most  young  people  are  eager  to  jump  on  the  money-making  BPO 

bandwagon. 

But is working for a BPO all that it's made out to be? 

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No,  says  ​Subhash Mukherjee ​(name changed on request), who recently quit his job at a 

call centre. 

This, in his own words, is his story: 

I  am  20  years  old.  I  was  recently  hired  by  a  call  centre  in  Kolkata  to  work  for  an 

overseas-based company. I was earning Rs 7,500 per month. 

My  workday  began  with  calls  I  had  to  answer  for  five  hours  continuously,  without  a 

break.  As  soon  as  I  was  through  with  one  call,  the  next  one  would  be  waiting.  There 

was  no  time  for  me  to  even say a few words to the person sitting next to me. After five 

hours  of  constantly  answering  calls,  I  would get a 20-minute break. Then, I would take 

calls  again  for  another  three  hours.  Without  a  break.  I  would  take  around  350  calls  a 

day. 

One  day,  I  reached  breaking  point. After taking 156 calls at a stretch, my throat started 

to  hurt  terribly.  I  paused  to  take  a  breath  and,  in the process, I missed a call. The calls 

that  are  directed  to  us  were  constantly  monitored  by  a  machine.  Immediately,  it 

alerted  my  supervisor  to  the  fact  that  I  had  missed  a  call.  My  supervisor  came  and 

asked me why I was in the 'wrap mode'. 

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What  this  means  is that my dialer shows a red bar when the person on the other end of 

the  line  hangs  up  without  getting  a response. The red bar is an indication that I did not 

take  the  call  --  that  the  call  was  not  'live'.  At  that  moment, I just wanted to pick up my 

bag  and  leave.  Permanently.  Instead,  I  stayed  calm  for  the  duration  of  my  hours  at 

work. 

I  fielded  all  my  calls  till  1  am.  But  I  had  made up my mind -- ​I would quit this job with its

inhuman pressures and its lack of empathy for employees. Workplaces like this have only one

goal -- to make money. This job expects you to work even if you are feeling ill; even if your

throat hurts. You cannot take even a 10-second break; the dialer throws calls at you

continuously and you have to start pitching (taking them) immediately. If you do not respond

to the person at the other end of the line, s/he might hang up. That shows on your machine.

You have to ask for permission to go to the toilet. Often, your request is denied by your

supervisor.

You repeat the same five sentences 350 times a day. Isn't it pathetic? 

When  I  started  out,  there  was  no  pressure.  Gradually,  though,  the  stress  grew  beyond 

the  levels  of  human  tolerance.  Working  at  the  call  centre  was  a  great  learning 

experience  for  me.  Now,  it  was  time  for  a  break.  ​When  I  worked,  I  had  no  time  to 

watch  a  film,  no  time  to read a book, no time to meet friends, no time to swim. For the 

last  few  months  that  I  worked  at  the  call  center,  I  had  time  only  for  two  meals  a  day. 

57
As  a result, I lost my appetite. I would return home at 2.30 am and go to sleep at 4 am. I 

would  get  up  at  noon  and  go  back  to  work  at  3.30  pm.  Now  that  I  have  quit,  I  can  go 

out  with  my  friends.  I can spend time rediscovering myself. With the approximately Rs 

65  per  hour  that  I  made,  I  can  buy  a  few  books  and  have  some  fun.  Maybe  that  will 

take away the pain that came with this job. But, believe me; the money could in no way 

make up for the pain! 

I'll never work at a call centre again. Nothing is worth the ordeal I went through.  

Subhash  Mukherjee  quit  his  job  in  mid-October.  He  is  now  pursuing  an  Economics 

degree at the Kolkata State University. 

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Explained below are suggestions for the above story as well as for any other call center

organization.

WHY PEOPLE ARE LEAVING BPO’s?

In spite of the salaries and facilities being high (especially for a graduate who

starts his / her career with a BPO company) the average attrition rate is very high in this

industry There are numerous reasons for the attrition to be high which can be categorized into

two broad classifications. The first can be coined as

“Drive Attrition”​ ​which caused due to the employer; the second one can be termed as

“Drag Attrition”​ ​which caused due to the employee.

The reasons for ​Drive Attrition​ ​are due to employer’s policy / policies of

terminating the employee at the end of the contract period for employment. Also the quality

policy of the BPO companies guides them to retain only the most productive employee and

hence makes them to terminate employee at regular intervals. A BPO company operates 24

hours a day and 365 days a year. The companies do not have a particular day as weekly off for

its employees. The employees are not even entitled for national holidays declared by

Government of India, as the company works with clients calendar. The call agents can avail

leave (which should not affect the schedule) only with prior consent, and any unauthorized

absence is a sufficient reason for terminating as employee.

Drag Attrition​ ​is basically due to the host of insecurities and vulnerabilities

associated with the taking up a career with a BPO company. The job of a call center agent (to

start off) can be compared to a telemarketing or a telephone operator. Hence the scope to take

59
up any other job (in case needed) or change of field is ruled out, as the experience gained in a

call center will not be an iota of importance. Many others quit, as the chance to climb up the

corporate ladder is bleak. Only a few very get promoted to the cadre of team leader and as

soon as promotions are announced the many of frustrated employees quit Further BPO

company work does not provide any scope for skill up gradation for the employee. The

employer trains the employee to speak good English and nothing else, which adds to the Drive

attrition rate. Also the nature of job in a typical BPO company is psychologically very

stressful. The working hours are artificially created which affect the natural rhythm of human

body. The symptoms of chronic fatigue, gastrointestinal problems, peptic ulcer, insomnia

and even depression are caused due to change of 24-hour biological rhythm of the body, hence

Drive attrition rate shoots up.

Listing out the reasons for non retaining of human capital include lack of growth

opportunity for the employees, lack of time based promotion, poaching of employees by other

competitive BPOs for higher salaries, employees quitting to pursue higher education, loss of

employees personal life, employees physical stress and health reasons, uneasy relationship

with peers or managers.

Present Strategies Adopted To Retain Human Capital

Companies have different kinds of strategies adopted to tackle the problem of

retaining human capital. It ranges from cash incentives to career concern for the

employee. As only 5 out of 150 employees become team leaders in a year, companies like

Daksh services and Global Vantedge ​believe that cash incentives are a great way to get

employees to stay on. Companies like ​GE, Wipro Spectramind ​Offer management diplomas

60
and MBA courses to their employees, as most fresh graduates want to study further. Further,

they also give innovative incentives like

scholarships. If an employee leave in between, they he or she has to discontinue the course.

Exl Service.com and ICICI one source ​hires outstation candidates (Mainly Non-Metros)

and put them in shared company accommodation. Also as an incentive the company picks up

the utility bills. If the employee leaves he or she loses the apartment.

Also for leading call centers like ​24/7 customer ​and ​MsourceE ​non metro talent currently

constitutes nearly 25-35 per cent of total hiring, and the main reason for this to happen is to

reduce attrition rate.

Many companies like ​HCL Tech BPO Services, GTL, Tracmail, and Vertex India ​use

various psychometric tests to get people who can work at night and can handle the monotony.

They also believe that giving career counseling and planning career paths to its employee help

to control attrition. Some of the BPO firms have adapted to the strategy of employing

housewives and retired school teachers. They believe that this would help in controlling

attrition, as they feel that the tendency and the potential of the employed to get shifted would

reduce drastically, where as some other BPO majors like ​Wipro’s Spectramind ​believes that

recruiting the undergraduates itself is a strategy to control attrition. Spectramind removed the

graduation prerequisite for their employees in order to keep human resource level from

waning Leaving alone the legal and mandatory benefits such as provident-fund and gratuity,

other strategies that are designed by the BPOs for providing benefits to the professionals

include;

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Group Medi-claim Insurance Scheme; ​This insurance scheme is to provide adequate

insurance coverage of employees for expenses related to hospitalization due to illness, disease

or injury or pregnancy in case of female employees or spouse of male employees. All

employees and their dependent family members are eligible. Dependent family members

include spouse, non-earning parents and children above three months

Personal Accident Insurance Scheme; ​This scheme is to provide adequate insurance

coverage for Hospitalization expenses arising out of injuries sustained in an accident.

This covers total / partial disablement / death due to accident and due to accidents.

​Subsidized Food and Transportation; ​BPOs provide transportation facility to all the

employees from home till office at subsidized rates or even at zero cost. Lunch is also

provided free of cost.

​Company Leased Accommodation; ​Some of the companies provides shared

accommodation for all the out station employees, in fact some of the BPO companies also

undertakes to pay electricity/water bills as well as the Society charges for the shared

accommodation. The purpose is to provide to the employees to lead a more comfortable work

life balance.

Recreation, Cafeteria, ATM, gym and Concierge facilities; ​The recreation facilities include

pool tables, chess tables and coffee bars. BPOs Companies also have well equipped gyms,

personal trainers and showers at facilities.

Corporate Credit Card; ​The main purpose of the corporate credit card is enable the timely

and efficient payment of official expenses which the employees undertake for purposes such

as travel related expenses like Hotel bills, Air tickets etc

62
Cellular Phone / Laptop; ​Cellular phone / Laptop are provided to the employees on the basis

of business need.

Personal Health Care (Regular medical check-ups)​; Some of the BPO'S provides the

facility for extensive health check-up. For employees with above 40 years of age, the medical

check-up are given once in a year.

​Loans​; Many BPO companies provide loan facility on different occasions like, during the

times of medical emergency, at the time of their wedding, also new recruits are provided with

interest free loans to assist them in their initial settlement at the work location.

Educational Benefits​; Many BPO companies have this policy to develop the personality and

knowledge level of their employees and hence reimburses the expenses incurred towards

tuition fees, examination fees, and purchase of books subject, for pursuing MBA, and/or other

management qualification at India's top most Business Schools.

​Performance based incentives​: In many BPO companies they have plans for, performance

based incentive scheme. The parameters for calculation are process performance i.e. speed,

accuracy and productivity of each process. The Pay for Performance is high as 22% of the

salary.

Regular Get together and other cultural programs​: BPOs also organizes cultural

program as and when possible but most of the times, once in a quarter, in which all the

employees are given an opportunity to display their talents in dramatics, singing, acting,

dancing etc. Apart from that the organizations also conduct various sports programs such as

Cricket, football, etc and regularly play matches with the teams of other organizations and

colleges.

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Wedding Day Gift​; Employee is given wedding day gift voucher worth Rs. 2000/- to Rs.

7000/- based on their level in the organization.

Employee Referral Scheme​; In several companies employee referral scheme is implemented

to encourage employees to refer friends and relatives for employment in the organization.

Employee Stock Option Plan; ​Some BPOs also give ESOP scheme to their employees to

make them more loyal to the company they work.

In spite of these benefits that are given through innovative strategies, people still leave BPOs

at a faster rate and retaining them has become a real challenge for the HR managers.

Now, the actual question, What types of retention strategies are required to solve this problem

and retain the Human capital, which is a crucial resource in the high growth IT-ITES industry

in India .

Strategies Suggested For Retaining Human Capital in BPOs

BPO service providers moving into value creation and value enhancement processes

of clients; ​The BPO service providers must look at value creation and value enhancement

in the process or activity that they do and this would be the one of the best strategy for the firm

to control attrition. Although a majority of players face high attrition rates there is a certain

class of players who have a much lower rate of attrition than the industry

average, and these operators operate in the niche segment in areas like research and analysis.

Office Tiger has set up its shop in India at Chennai. The attrition experienced by

Office Tiger, a US$20 million annual turn over company stands at 8%, much lower in

comparison to the rest of the BPO industry

64
The major reason being that, Office Tiger offers specialized services such as business research

for banking industry and analytics to its clients, where there is a lot of value addition

happening. Indian BPO’s can adopt this strategy, the main reason being that the Indian

software giants like Infosys, Wipro and Satyam have already proven their potential in the

world’s software market segment for the credibility and creative ability of Indian work force.

Hence Indian brain is acknowledged world over for the spectacular creativity and capability

for problem diagnosis & solving.

Hence if the Indian BPOs have a better edge over the other players in the world in moving

towards the value creation and value enhancement processes of its clients. This would mean

that BPOs have to go for specialized services segment or in other words move towards the

KPO (Knowledge Process Outsourcing) where the stress is laid on as business research

areas and this would for sure reduce the attrition rate drastically.

Changing perception of employees from life style to career; ​The perception of the

employee about the BPO has to change from being a life style to a career option. One

way of doing this is to re-construct the organization structure. The chances to climb the

corporate ladder should be made to look bright. In the present day the options that a BPO

employee has in climbing up the corporate ladder is as shown in Figure1.1a.

65
Some modification done to this corporate ladder in increasing the number of levels,

can give a prospective picture to the path ahead for a call center agent, and also will

aid to change the perception from life style to career, which will control attrition to a

reasonable extent. The modified version is shown in figure below.

66
Change the employable target audience and also in a way become socially

responsible; ​Neither age nor physical appearance is a hurdle for call center employment.

So the BPO firms should take in those who are physically handicapped, and hence in a

way become socially responsible. This could be the best adopted strategy for Indian BPO

companies, the reason being that two percent of Indian population are physically

challenged (www.indiastat.com), this would mean that two percent of One billion, which

is a real big number. Also there are many schools in India, who give formal education to

the physically challenged. So the Indian BPO’s can definitely look this as a viable

strategy for bringing down the rate of attrition. Also this strategy will make target

employees to be more committed and loyal to work, as they would look at this job as a

67
career and would not shift jobs very frequently. Another reason for not shifting jobs

would be that any other job would not give them a salary comparable to BPO company

standards

Make employees feel that the company cares this can be done through effective

communication​; proper communication is the first step toward creating pleasant

environment for the employees and also a way to show that the employer cares and they

just may stay. The employees should be well aware of what's happening with the

company. At any time, all of the employees should have a pretty good idea of how

business has been, and they should be aware of what issues the company is attempting to

address. The people should also be kept up to date with important events affecting the

company. The managers should listen to the employees when they have ideas for

improvement. They may have some ideas to improve productivity, and when they do

come up with one, let everybody know where it came from.

Clarity in expectations; ​employees should be very clear about the appraisal system,

companies expectations from employees/team-members, parameters to measure their

performance, consequences of failure in meeting the expectations, rewards awarded if

they exceed the expected level of expectation

Giving employees a choice of rewards; ​Rewards are as different as the people who

receive them and it doesn't make sense to give rewards that recipients don't find

rewarding. For example, some people prefer more pay, while others prefer more time off.

A promotion might be more rewarding to one person, while a job-sharing arrangement

might be more rewarding for another. Some people are excited about sports events, others

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about movies. Some employees would love a dinner in a romantic restaurant, others a

book by their favorite author. Food, fun, education, improved work environment, gifts,

travel, family-oriented activities - the options are endless. How can one know what will

be rewarding to employees? Best thing to do is to “Ask them”. Smart organizations are

also letting employees choose their own rewards from reward menus and catalogs.

Personalizing rewards shows that a company cares enough to discover what "interests"

each employee, rather than just distributing generic items.

Adding value; the key ​employees seek frequent opportunities to learn and grow in their

careers, knowledge and skill. With out which will feel they will get stagnated. A

careeroriented,

valued employee must experience growth in value for him/herself within the

organization.

  

   
 

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 QUESTIONNAIRE ON ATTRITION

AIM: ​To find out the reasons for increasing rate of attrition in BPO industry, and suggestions

from the respective employees to be implemented which will help to reduce the attrition rate.

Employee Attrition Survey

1. Occupation: ​________________________

2. Work environment: ​________________________

(Excellent, Good, Satisfactory, Bad)

3. I feel I am a valued part of my office: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

4. Promoting respect and fair treatment

among all staff is a high priority of this office: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

5.​ ​Communication among staff in this office is effective: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

6. I have a clear sense of the future direction of this office: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

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7. My office’s atmosphere is generally friendly: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

8. Morale in this office is high: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

9. There is a spirit of cooperation among staff in this office: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

10. This office has policies that are supportive of its staff: ​________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

11. My workload and expected completion times

are reasonable​: ​_____________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

12. I receive constructive feedback about the quality

of my work: ________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

13. I feel encouraged by my office to pursue professional

development opportunities​: ​____________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

14. This office reasonably accommodates personal needs: ​____________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

15. I feel heard when I communicate with others

in my office: ​____________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

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16. I like my job: ​____________________________

(​Strongly agree, somewhat agree, neutral, somewhat disagree, strongly disagree.​)

17. What is the extent of work pressure at your work place? ​____________________________

1. Heavy pressure

2. Moderate Pressure

3. Light Pressure

18. How long do you travel to work everyday? ​____________________________

1. Up to 10 km

2. 11-19 km.

3. > 20 km.

4. Can’t say

19. Do you face any problem when to wish to take a break? ​____________________________

1. Yes- Problem to break

2. No - Problem to take break

3. Refused

20. ​Do you work overtime? 

If yes, then for how many hours? _______________________ 

1. 1-2 hrs. 

2. >2hrs. 

3. Refuse 

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21. Are you paid for the hours you work overtime? 

________________________ 

1. Yes 

2. No 

22. ​Which is the break where you consume much time? ________________________

1.Tea/Coffee/Refreshment break

2.Lunch Break

3.Break fast

4.Dinner

5.All other break reasons

6.Not specified

23. Is your work a reason for your health problems? ________________________

1. Yes.

2. No.

24. Do you have canteen at your work place? ​________________________

If yes, then how is the quality of the food ?

1. Good

2. Average

3. Poor

4. Can’t say

25.​ ​I think often about seeking employment elsewhere: ​____________________________

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(​Yes, No.​)

26. Suggestions, if any.

CONCLUSION:

The strategies suggested in the project are not exhaustive to retain the human capital of

BPOs. These are just the basics and if implemented in a proper way can give good results.

The organization has to maintain quality of service, which they attain by inculcating the right

philosophy and principles in our staff. Training programmes are thus very important. It is a

challenge to create passion for work in people and that applies for HR people too. Secondly,

they have to battle with attrition, which is highest in the BPO employees. Besides a good

salary, the company needs to give people fancy designations, career paths, and empower them,

which will lead to better productivity. They should also have a succession plan for at least the

top two levels. They have to attract the right talent, because there is a dearth of trained

personnel. The parameters of judging talent are different for various roles; soft skills have

assumed immense significance today. People are in a sensitive state of mind; a customer care

executive cannot afford to be rude with their customer. To curb the high attrition rate, the

success mantra for a BPO is not just offering a fat pay packet, but chalking out long-term

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development and career growth for employees, along with giving them a sense of

empowerment. A company should always innovate, keep their employees busy with various

projects. So that the functioning of an organization is not plagued by somebody’s sudden exit,

it is important to keep a databank of apt substitutes ready. They should try to chat with the

employees trying to understand who is not happy and may leave the organisation. They should

try to address their problems and grievances and always keep the replacements ready. This

may encourage retention strategies , thus reducing attrition rate .

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