Is Your Company Losing The Right People

India Attrition Study 2008
The Game Plan for HR Professionals

Attrition can never be wished away. One can reduce it to the right level. But what is even more important is – are you losing the right people.

The study of attrition by PeopleStrong and Business Today has thrown some interesting data. Since the study covered 59 companies in 8 industry sectors across India, for the first time, we have comprehensive data on attrition. Until now, each company had only its own data, since others would shy away from sharing theirs.

But, we now have the benefit of seeing some trends that could be used to make HR strategies. Here are some highlights:

Reducing Attrition: Losing new employee early leads to a lot of loss of opportunity as well as wasted expense and energy. The study shows that 33.8% of those who quit are Early Leavers. One of the most effective ways to reduce attrition would be to cut this down by half. If the overall attrition of a company is 15% and early leavers are one-third of this, then cutting down the latter by half would mean that attrition would get lowered to 12.5%, a huge change! A strong new employee induction and orientation program would create strong glue to hold them back. The first 90 days are most risky.

Women are leaving earlier than men across industries. Is there a special intervention that is required here?

Regional Practices: All big companies have regions, and they have regional HR organizations. While each region may have its own cultural flavour, but they all fall under the gamut of common corporate policies. This study clearly shows that different regions need to make a different implementation plan for the same HR strategy. For example, 40% of leavers in North and 27% of leavers in Rest of India are Early Leavers. What this means is that there is a different need in North because of which a stronger and different approach is needed, so common
broad brush may not work. And the gains would be much higher too. Also, as an HR Head it makes more sense to implement ‘reduce Early Leavers’ plan in the North as the gains there would be maximum.

Reducing Early Leavers: Early Leavers constitute a whopping 64% in BFSI, followed by a significant 40% each in ITES and Retail. If your company operates in these industry segments, you know where the priority must be.

Undergraduates and Frontline Staff are the biggest categories in Early Leavers across all industries. A targeted approach in these categories will bring the biggest gains.

Quality of Attrition: No company likes to lose the Top Performers. They are the ones who drive the growth as well as the key strategic initiatives. Surprisingly, the IT sector has emerged as the dubious winner here with 45% of quitters rated as Top Performers, followed by Manufacturing at 23% and BFSI at 22%. The best are Pharma (9%) followed by Retail and Telecom (10% each) and FMCG (11%). What can the HR Heads of IT, Manufacturing and BFSI learn from their colleagues in Pharma, Retails and Telecom?

North seems to be able to keep the Top Performers the best (17%). The other two regions are at 22% each.

One of the best ways to keep the top performers engaged would be by implementing a strong career planning program for them. Give attention to everyone, but focus on them. This is well supported by the study’s findings – the biggest driver of attrition is Opportunity for Career Growth (25%) followed by Salary (10%), Type of Work (9%) and Training and Development (8%). A good career planning program impact 49% of the drivers!

Check out the story at http://businesstoday.intoday.in/index.php?option=com_content&Itemid=1&task=view&id=10919&sectionid=5&issueid=55&page=archieve.

If you are interested in somewhat deeper data, check out http://www.peoplestrong.com/tl_ias.htm.