How Can We Reduce High Attrition Without Using Bond Agreements in IT?

I am working as an HR generalist in an IT company. Nowadays, we are facing a problem of a high attrition ratio due to various issues, such as higher studies and relocation. My manager wants to introduce some clauses to ensure that after receiving training, these individuals will not leave the company. However, my manager does not believe in a bond system.

Please suggest what options are available for addressing this issue.

I am also from IT, so I understand the scenario. I suggest you try to convince your boss to increase the salaries of employees, as this might prevent them from quitting the company. Just try it. When you compare the cost of hiring and training new employees, a salary hike is relatively minor.

The best option is to increase salaries, which is not always accepted by the employer's side. Therefore, give importance to non-monetary aspects as well.

- Promote efficient employees who have been working for a long time.
- Engage in employee activities that benefit employees.
- Provide a stress-free environment for employees.
- Ensure work is done by employees in a smooth manner rather than giving them targets.
- The most crucial aspect is to try to form a team rather than a group. Many employees resign due to favoritism, even if they like the company. Some people are unable to face the challenges posed by colleague employees.

Finally, whatever you do, it must create an environment where "all the employees work under one family roof" rather than a commercial roof.

To begin with, you are trying to solve the same problem that we all are facing. However, the leading and lagging factors at your firm make it unique. It's a welcome break to hear that your manager doesn't want to implement the bond. Before we brainstorm any further, let's take a deeper look.

Is Attrition a System-Generated Problem?

We are all aware of the employee life cycle. The growth for every talent cannot always be organic. Aspirations change, so do the requirements of skills. In this big-picture view, it is evident that there would be constant movement. Now let's take a role-specific view. If you can hire someone who wants to work in the role and has a vision, you might not have to worry about them leaving after you train them. But the question is, how do you find them?

An IT product company I know hires engineers and founders who are building products similar to theirs. They don't just hire for certifications or experience. This pattern of hiring gives a much longer employee life cycle. They even offer product ownership to a large extent, of course with the IP belonging to the firm.

There are cookie-cutter roles for which you have to hire talent with any qualification and train them on short notice to make them billable. Attrition in such roles can't affect much, as the talent funnel is big enough to backfill the open position immediately.

Money as a Motivator

Money is essential and a differentiator, but not the sole motivator. If you pay more, someone will add on to it and poach eventually. Worse, if you are the highest paymaster in your talent market, you might have to implement the "Up or Out" policy. This would ensure you have the best talent and justify the pay. However, forcing talent to grow or retrenching the non-performing ones will create a whole new set of problems.

Hiring mediocre talent and training them to become the best will offer stability. Talents who might not have performed in non-conducive environments might turn into gold mines for you. Before you train, identify the responsibilities the talent is willing to deliver. Understand how long their aspirations would be aligned with what your organization has to offer. And plan only until that timeline.

A mentor once told me that talents with generic skill sets have a minimum employee life cycle of 3 months to a maximum of 18 months. Niche talents are between 1-3 years. However, their movement is often based on pay. Hence, that's your solution if you are hiring them.

Building a Talent Pipeline

Keep a talent pipeline ready for existing employees working on crucial roles. Cross-train teams and grade the level of performance in terms of job readiness. If the most trained employee in a team can deliver in all the 15 critical tasks required in the role, train the entire team on all those 15 tasks.

Agility is your only solution. Work closely with the reporting managers to build teams where if one member leaves, the delivery remains unaffected.

Thinking in Terms of a Career

Lastly, no matter which role you hire for, think in terms of a career. A job is a stepping stone for the next best career move. Prepare every employee for that. No matter how difficult it might be, give an excellent exit to all your employees. Treat them with respect when they leave. Celebrate their farewell, just as you invest in their induction. This would not only instill faith in your existing employee base but also build a strong alumni network.

Choose to see attrition as an opportunity to build a bigger employee alumni. A talent who leaves you in haste might become your future hire. Someone leaving your firm after training will leave other employers under such conditions. However, if you treat them well, they might want to be re-hired if you offer. That opens an entirely new possibility for you where you may find loyal employees with greater market intelligence and experience.

Hope this helps! Wishing you all the best!

Thank you very much for your valuable feedback, @Cite Contribution. Hiring mediocre candidates is a good suggestion. Actually, we have only tried hiring freshers. We trained them for almost 8-9 months, but as I mentioned, most of them left slowly due to various reasons.

Regarding your point that management is not in favor of salary appraisals, I agree. All employees do receive their annual appraisals, which are considered good enough compared to other companies.

I know very well the scenario. I am not working in the IT field, but the attrition rate is almost the same in other companies too. From the beginning, my responsibility has been to reduce the attrition from 40% to 20%. After two years, we achieved an attrition rate of 19%. This performance was only possible because of the systematic approach in HR activities, adherence to and enforcement of company policies, and promotion of the 6 drivers in HR, as well as employee engagement.

Regards,
Sandeep
[Phone Number Removed For Privacy Reasons]

This problem persists everywhere, as stated by senior members. There are many ways we can reduce it. The ways suggested by Ms. Madhavi can solve some problems. Some more ways are:

1. Engage the staff in various multitasks where they can showcase their talent.
2. Appreciate them from time to time for their good work.
3. Create a culture in their minds where they see themselves as stakeholders in professional and company growth.
4. Remind them that the company provides a platform for them to showcase their talent and grow.
5. Allow them to act as individual entrepreneurs, where they are responsible for all successes and failures.
6. Implement favorable leave policies and flexible timings to reduce attrition.

Regards