Reducing Attrition: What Key Areas Should We Focus On for Mutual Growth?

I would like to know the areas where we need to concentrate to reduce the attrition rate in an organization, which helps the company to grow and employees to grow in a similar manner.

Band I

When you have people with 0-5 years of experience, give them work that is of high quality and challenging. Ensure that the young employees are learning daily, keep their salary structure in line with industry standards, and ensure that their salary increments are 15-25% every year. People with less than 5 years of experience are great assets since their productivity is also very high.

Band II

When people have 5-8 years of experience, they start looking for lead roles and want to manage people. Therefore, during the transition from Band I to Band II, identify young leaders and give them a high level of task ownership and leadership responsibilities. People in this band seek opportunities to build their leadership skills. Keep their salaries 10-15% higher than the local market standard.

Band III

You don't need to worry about people with 10+ years of experience, as their attrition rates will likely be lower. This is because they have high job-related expectations and family commitments. Show them a high level of respect and make them feel a sense of ownership within the organization.

Other Points to Consider:

• Provide employees with EPS benefits.
• Offer opportunities for employees to gain cross-functional experience.
• Aim to hire employees from the local/native town instead of outstation employees.
• Provide challenging opportunities for employees.
• Ensure that the variable pay does not exceed 10-15% of their Gross CTC.
• Reward employees with milestone awards at 2 years, 5 years, and 10 years.

These are the key points that come to my mind right now.

Regards,
Kiruthika

Recruiting the right people for the right job is one of the most important responsibilities of an HR Manager. Even after performing this responsibility well, they cannot sit back and relax. They face another challenge: retaining the good talent that was hired.

Factors Motivating Employees to Stay

Factors that motivate employees to continue in a job include job satisfaction, career development, recognition of good work, having understanding managers, and so on. While “good pay” is also one of them, it does not fall under the main motivators that delight the employee. Thus, by having a good employee performance management culture and policy in place, an HR manager can ensure that the employee's expectations from the company are met. This would, in turn, bring down the attrition rate and also ensure long-term loyalty of the employees to their organization.

Therefore, the basic foundation, as we understand, is to define good employee performance management policies that reduce the attrition rate in an organization.

Main Factors to Lower Employee Attrition Rate

1. Define the right set of competencies for different job roles. The ability to customize this for individuals would be an added advantage.

2. Set standardized goals for the job roles, with the ability to customize for each individual. Also, employees' goals should align with the organization's goals.

3. Convey the job expectations to the employee clearly, well in advance.

4. Allow objective appraisals as much as possible. This can be achieved by:
- Timing the feedback closer to the incident (Interim feedback).
- Getting feedback from multi-raters.
- Social recognition to identify good performance.
- Rewarding the good performers.

5. Define an annual appraisal process that is simple. Activities should be kept to the minimum, and the important ones, like rating and career development meetings, should be given importance. The approval mechanism should be simple and clear. Simplicity is the key to effective use.

6. The end result of appraisals should be aimed at the career development of an employee. The ability to define career development plans and track them to closure would be beneficial.

Once these policies are established, organizations can look into automating them with clear, customizable performance management software to reduce the amount of manual effort.

Therefore, having better employee performance management policies will not only minimize employee attrition but also enhance their efficiency, helping the organization reach the heights of success.

Regards,
Kavitha Kalyanasundaram

Kiruthika has offered you a very detailed view on attrition. Here are a few non-monetary benefits that you can consider for your firm.

Band 1: Educational Opportunities

Offer them MBA/MS/M-tech courses from universities of repute. You can easily find a university or even a well-known deemed institute that can offer your employees contact-classes for the courses during the weekends. This will take away the employee's worry about looking for good institutes and the hassles of attending classes. You can easily negotiate lower fees for your employees as you are already offering them a promise of enrollments. This is best for the talents who have been working for the last 2-3 years and couldn't take any breaks due to their employment. Alternatively, you can plan for Management Development courses with Tier-1 institutes for mid and senior-level employees. This offers them a benefit to increase their employability beyond measure. The catch remains that your employees need to work with your firm during this duration or the lock-in period that you may decide.

Band 2: Subsidized Education for Employees' Children

Offer your employees subsidized fees for their children in a few of the most preferred schools. You might need to make a small investment to book a few seats for the kids of your employees. But there would be guaranteed continuity in their employment with your firm.

Band 3: Housing and Car Schemes

Find good housing schemes and car schemes and create a partnership with the builders and dealers. These are major areas that employees spend most of their time worrying about. Even if there are salary hikes with your competitors, your employees are still likely to leave you. You may still need to continue making your workplaces better. However, the top reasons to leave work might entirely change. Yes, it would require a lot of work from your end. However, it is doable. There are large MNCs who have been doing this through their admin teams. Consider the increased administrative work as an investment to avoid attrition.

Regards