How Can HR Tackle Rising Attrition During Tough Times in Our Manufacturing MNC?

We are in machine manufacturing (MNC) at the Ahmedabad location since 2010. We have not had good business for the last 2.5 years, but there is a positive aspect - there has been no attrition for the initial 2 years. However, starting from the beginning of 2016, the attrition rate reached 20%. Managing production is not challenging as we still have enough capacity relative to current orders.

HR Role and Attrition Rate

My question is, what is the HR role in this period, and what could be the reason for the high attrition rate? I believe we are providing only half the percentage of salary increments compared to previous years of good business. Additionally, given the current business circumstances, employees might be concerned about the situation.

Please provide your advice on this matter.

Regards

There are many initiatives you can consider, given the bandwidth you have! Identify areas where you would like to bring about a change. Start with employees and offer them skill enhancement programs. This will help them secure better jobs in case you have to downsize. Furthermore, it will also improve employee cohesion as they will perceive a higher value in being with the firm.

Offer transparent communication. During transitions, it's crucial to keep everyone informed about what is happening within the firm. If possible, involve employees by soliciting suggestions on how to increase revenue, improve production management, explore new markets, find better vendors, streamline logistics and supply chain, and so on.

Seek support from the management team at your firm in taking ownership of all these processes. How open are you to considering any of these suggestions? Kindly share. I look forward to hearing from you.

Kind regards, [Your Name]

Importance of Communication During Challenging Times

First of all, your top management should reach out to employees and share the issues being faced, as well as the steps taken to address and recover. Employees have been loyal enough for 2 years and did not leave, but they also need salary and job security. You cannot blame them for leaving after 2 years. Employees understand the ground situation, and it was incumbent on management to keep communication channels open during difficult times.

Probably, your management was not proactive enough. Now they can try to rectify the situation by communicating openly and providing the factual position and efforts or strategies of management.

Dear Sir/Madam,

We practice holding plant-level meetings after every quarter to inform everyone about the current scenario and future action plans, which are presented by top management only.

To enhance skills, we have introduced job rotation. However, it has been observed that everyone is now capable of working in any area.

We adhere to the motto of world-class manufacturing, and necessary actions have been taken accordingly.

Best regards,
Parimal

I believe the first two years were your transition period, where everyone was moving in the same direction, learning to develop skills and the span of rational mobility. After that, the next three years mark the birth of intuitive philosophical acquired skills, where the pursuit of excellence flourishes. I also believe that during these past three years, there has been attrition, but the management hasn't noticed or has disregarded it, perhaps due to the recognition of superiority and esteemed value.

I think the streamlining of the organizational histogram was simply overlooked. Among the greatness of HR management tools, I still believe in addressing adverse behavioral concerns (Human Nature) and leveraging only a single part of its complex natural control.

Please let me know if you have any questions or need further clarification.

Best regards,
[Your Name]