Struggling with High Employee Turnover in a Competitive Market: How Can We Improve Retention?

Dear All,

I am working in a CA firm and facing an employee attrition problem. I am focusing on retention policy and trying to find out how to retain them. I do have good ideas as well on retention, but the real problem is that there is a lot of competition in the industry, so attrition is high.

My boss hires employees only based on their technical skills, not on the basis of an HR round, because he knows all the future clients and assignments. If a person has the knowledge in a particular area that can be fruitful for our project, he does not bother with other points. However, later, such employees create problems when they receive good offers from other companies and leave us.

Furthermore, there is no reference check system in the industry due to competition, so we can't properly check through a reference check system even if someone is leaving us. Consequently, no one goes through a background check system with us, so they don't have any threat that they wouldn't get any job anywhere, leading some to fake their experience.

If I plan for the retention of the staff I am going to hire, I can make the recruitment process robust through proper HR rounds, inductions, and counseling to mold their minds and minimize attrition. However, the challenge lies in retaining those who are currently working with us.

If anyone has in-depth knowledge in this field and any suggestions, please guide me. This is very urgent and important for me.

Attrition and Retention are common in any industry. What is the total employee strength of your organization?

To be frank, what your boss thinks is right to a certain extent as it's going to be a client-oriented job. I have some tips.

- As you said, your boss is not taking into consideration the HR Round; you can explain to your boss clearly on pros and cons. If not, try to have an HR round initially so that you can reject the unfit candidate at the very beginning.
- Request your boss for authority on salary fixation. If he denies, at least request him to come up with a budget for manpower so that you can decide on the salary part. Hereafter, upon getting it, if you find unsuitable candidates being offered, offer a lesser package so that they don't accept the offer.

Submit a clear report on the happenings to your boss and make him understand.

Retention - When it comes to retention:
- Try having some incentive part in the package which motivates your employees.
- Accumulate the incentive in an account and announce that it would be released once a year or every 6 months. On resignation, one will not be eligible for the same, so there is a chance of retaining employees for a minimum of 2 years.
- Or come up with a bonus component in the CTC away from take-home, which would be given on successful completion of one year of service.
- To retain an employee, you need to have clear, transparent, and genuine appraisals in place. For sure, appraisals done on the right time in the right way will definitely help you to retain an employee and make people believe they will be getting paid less than their appraised salary in the outside market.
- Talk to employees about appraisals on a regular basis, which will psychologically make them wait to know their appraised salary.
- Create a cordial working atmosphere; take care to ensure everybody enjoys their day job and take them for outings at regular intervals.
- Discuss with them the company's future plans and make them get gelled with the company's vision, which will make them feel confident about their career path.
- As it's client-based, employees should be allotted with clients on a rotation basis; no employee should deal with a client for more than 3 months.

These are a few suggestions. If you find any point to be argued, do let me know.

- Rajesh

Dear Rajesh,

Thank you for the suggestion. As you mentioned, we do have an annual bonus component as well. Currently, we have around 150 employees, most of whom are trainees. Unfortunately, after completing their training, they tend to leave us. However, out of the 150 employees, approximately 15-20 are permanent employees who are truly dedicated to their work. Additionally, about 10 individuals are responsible for mentoring the entire workforce.

Please provide your suggestions on how we can address this situation effectively.

Thank you.

Hello Swati:

Facing an employee attrition problem, I am focusing on retention policy and trying to find out how to retain them.

If new hires quit or get fired, you need to fix your selection process. You need to start before the job offer is made.

There is a lot of competition in the industry, so attrition is high. That does not explain the loss of new hires.

My boss hires employees only based on their technical skills, not on the HR round because he knows all the future clients and assignments. If a person has knowledge in a particular area that can be fruitful for our project, he does not bother with other points. I see the cause of the problem -- the boss.

Later, such employees create a problem; if they get a good offer from another company, they leave us. A clear sign the selection process needs to be fixed.

There is no reference check system in the industry because of competition, so we can't check through the reference check system. That is not a very good excuse.

Even if anyone is leaving us, no one goes through a background check system with us. So, they don't have any threat that they wouldn't get any job anywhere, and they fake their experience. Employers cannot blame their employees since they hired them.

If I plan about the retention of the staff I am going to hire, I can make the recruitment process robust through proper HR rounds, induction, and counseling to mold their minds and minimize attrition. We do not reduce attrition by molding employees' minds.

But what to do about those who are presently working with us? We are facing a problem in retaining them. They will leave, so you must fix your selection system so that you do not make the same mistake over and over again.

If anyone has in-depth knowledge in this field and any suggestions, please guide me. That is what we do. Send me an email; see my email address in my signature block below.

As you said about the bonus component, we do have an annual bonus as well. What good is an annual bonus if the new hires are no longer on the payroll?

We are around 150 employees, most of them are trainees who, after the completion of their training, leave us. That tells me your employee selection process is not working effectively.

Hi Swati,

Very well understand your dilemma as working with a CA firm where CAs have tremendous good opportunities and options open to them.

First let us know if your CA firm is a partnership firm or a part of the Global accounting firm? Your retention strategies would depend on that in a major way!.

Secondly, do conduct the exit interviews to ascertain the underlying reasons for the attrition rate.

Some of the ideas you can draw upon;

Draw lessons from the Indian Army, for their command and control leadership where the troops are highly skilled, motivated and morale is high. The comparisons is drawn as both(CA firm & army) have large numbers of employees and army's style of leadership may not relevant to BPOs but it must be understood & gathered that military organizations are team oriented with continuous training. Troops expands their skills and experience capabilities they never dreamed possible, produces a highly motivated and efficient organization. Learning opportunity and responsibility is the key.

If a key employee resigns, it should be taken up on a priority basis and kept confidential as far as possible and the senior management should meet the employee to discuss his reasons for leaving and evaluate if his issues bear merit and whether they can be resolved.

Perhaps some of the ideas shared in this following thread of discussion may assist you.
https://www.citehr.com/787-innovativ...-part-one.html

Best Wishes,

Rajat

Hello,

My two cents on your issue at hand:

If you are facing an employee attrition problem - no big deal! Every company has to face it, today or tomorrow. You are facing it now; the situation is unacceptable but part of life.

Regarding your retention policy and your efforts to retain them - if they were to be retained today, they will quit tomorrow, so today's good idea will be tomorrow's bad one.

Every industry has competition and attrition.

I would say your boss is a visionary and wise man who hires employees only based on their technical skills, not on the basis of HR rounds (maybe he sees HR not doing their job correctly - find this out and correct it, ask him how to improve the situation).

A simple reference check system: call up ex-employers, ask for feedback, fill in an employee form, give it to the boss, and get approval (even after he appoints them).

The solution to your problem is to appoint more staff outside their circle of influence (think about this, think again), then coach them, differentiate their results from the old staff, collate, and report.

Dear Swathi,

At times, you cannot stop a person by using all the retention strategies, as they are determined to do so. There could be many reasons for an employee to quit. As a good HR professional, help them in the quitting process and stay in touch with them. A good HR always has to balance with both the management as well as with the employees. Instead of restraining them, try to get candidates from their references.

Thank you

Sawti,

Someone has already mentioned that you could have the basic HR round and also the employee reference check simultaneously - so that before you present the case for further evaluation, you have cleared it from your perspective. Additionally, I recommend that you conduct the exits very well and try to analyze the data collected. This shall help you to identify the reasons for the separation, and you can present the same to your supervisor for a discussion/debate on the working of the system/policies, etc.

Besides, of course, doing a few activities for employee motivation, having a good employee grievance handling system. All these small activities would help build motivation and enthusiasm to come to the workplace.

Cordially,
preet

Hi Swati,

What an ideal situation! I suggest that you propose to your boss that he should have 50% contract employees purely based on the future tasks at hand. This way, your boss can bill your clients for the contract employee's remuneration and can have the luxury of accessing the best talent available in the market. And, of course, Swati, this approach may save a lot of salary money for the company.

Thanks for the suggestion, but this is not applicable for a CA firm because no CA would be ready to work on a contract basis as there are numerous opportunities available for them in the market.