Understanding Attrition: A Comprehensive Overview
Attrition is generally considered on the following basis:
OPENING + ADDITION – DELETIONS = CLOSING
ATTRITION % = (DELETIONS / (OPENING + ADDITION)) * 100
However, if you want to be a little more detailed, you could consider the following elements:
Types of Employee Turnover
Attrition or Employee Turnover is the exit of individuals from the organization. Broadly, four types of exit can be considered:
- **Functional Turnover** – This is the exit in which poor performers leave (can also be called Forced Attrition).
- **Dysfunctional Turnover** – This is the turnover in which good performers leave (this is the regular form of attrition).
- **Avoidable Turnover** – This is a situation where the exit could have been avoided (situations arising due to, say, poor handling of a situation by a boss that makes a person leave even though he/she may not have planned to).
- **Unavoidable Turnover** – This is a situation where the turnover cannot be avoided (for example, death while at work, illness at work, transfer of a spouse to a new location, etc.).
Thus, from above, it can be seen there are three areas where we do not have control but one where we decide. Thus, in my opinion, to arrive at the real attrition, we should remove the exits arising out of the Functional, Avoidable, and Unavoidable turnover and consider only the Dysfunctional Turnover.
This would give a more realistic attrition calculation.
Regards,
S Venkateshwaran