Employee Turnover Crisis: Can Money Alone Keep Your Team Together? What Do You Think?

In any organization, the high turnover of employees has increased in alarming proportions. Being in HRM, what do your friends think we have to do to arrest this tendency? Can monetary satisfaction alone motivate employees to stay back? I expect my friends to express their views.

What is the context of your query? Moreover, how come you have made a sweeping statement "In any organization, the high turnover of employees has increased in alarming proportions"? On what basis have you made this statement? What is your designation? What is the nature of your industry? What is the total employee count? What is the attrition percentage? What study have you done to study the attrition? There are so many questions associated with your post. Please provide these basic details.

Reasons for Employee Turnover

Reasons for employee turnover are embedded in the organization's culture in general and leadership style in particular. As far as employee attrition is concerned, a lot of discussion has happened on this forum. I recommend you refer to past posts. I am referring to the following two threads. I have also given my replies in the threads:

https://www.citehr.com/456368-use-th...anagement.html

https://www.citehr.com/showpost.php?...mp;postcount=4

In both threads, I have given exhaustive reasons why employees leave their companies.

Thanks,

Dinesh Divekar

Understanding Employee Turnover

Employee turnover arises due to the addition of employees, known as accession, and separation from the organization, such as retirement, resignation, layoff, or discharge. Every separation, whether voluntary or involuntary, is significant for the organization.

Employee turnover can be either avoidable or unavoidable.

Avoidable Causes

- Bad working conditions
- Poor job dissatisfaction
- Long hours of work and low remuneration
- Lack of incentive schemes and promotional avenues
- Poor relations with seniors and fellow workers
- Ineffective grievance procedures
- Selection bias and lack of training programs
- Inadequate housing, medical, and welfare facilities
- Lack of safety measures

Unavoidable Causes

- Personal betterment
- Domestic affairs
- Illness or accident
- Unsuitability for the job
- Housing or transport problems
- Retirement or death

Avoidable causes can be managed by providing better employee engagement programs, while unavoidable causes are beyond management's control.

Control of Turnover

Turnover may be controlled by conducting personal interviews with outgoing employees, known as exit interviews. Opinion polls or surveys should be conducted by independent persons to understand the opinions of current employees, enhancing loyalty and engagement towards the organization.

Remedial measures should include satisfactory wage plans, incentives, promotions, sound personnel policies for recruitment, selection, placement, and training, provision of reasonable amenities and welfare, setting up mechanisms for addressing grievances, proper retirement benefits, and effective communication channels to improve employee morale. Improvement in supervision quality and training programs to enhance employee skills are also crucial.

Based on the above, it is clear that employee loyalty is beneficial for the organization and helps in reducing turnover.

"MORE EMPLOYEE ENGAGEMENT, LESS EMPLOYEE TURNOVER."

Thank you!

Regards, Amit

Dear Dinesh, Thank you for your queries. First, I should apologize that 'M' got vanished from 'Many' and became 'Any'. It is a well-known fact in any industry that employee turnover has become a matter of concern. That was the reason why I have raised this topic in the forum. Industry or organization does not mean only IT or BT or such. It could be anywhere people work for their livelihood, make their career, support the organization, and achieve high status.

As for your series of questions, I would like to inform you that I am an HR professional, Trainer, and Counselor. Recently retired as Group Vice-President from a public limited organization. I have about 40 years of industrial experience in both public and private organizations and have worked in almost all facets of the industry right from aeronautical to textiles.

I have read your profile and have high regards as you are a most valued member in Cite HR, and you are also a trainer and moderator. Hats off to you.

I just wanted to know what the youngsters in HR think of the present situation as I have seen many disheartened with this employee turnover and give them some tips and also many of my learned & experienced friends like you give suitable advice.

Regards, Srinaren

Since you say that you have 40 years of experience, it implies that you are well above 60. Therefore, gentleman, the social situation when you entered the job market and the social situation prevailing now is vastly different.

Economic Liberalisation and Its Impact

The economic liberalisation of 1991 brought about social and economic upheaval. The real effects of liberalisation became noticeable only after 2000. As India ushered into the new millennium, an explosion of business started taking place. A large number of foreign companies entered India, creating a new market: the job market. Getting the right skilled people became a challenge, and new terms like headhunting and poaching became common. This was the starting point when HR professionals began worrying about employee turnover, primarily due to a mismatch in the demand and supply of labor.

The Ongoing Challenge of Attrition

The challenge of attrition is going to remain. During an economic recession, whether it was the smaller version of 2001 or the full-fledged one of 2008, the severity of the challenge was lessened, but it resurfaced with full might when the situation normalized.

Mitigating the Impact of Attrition

Notwithstanding the scenario mentioned above, employers need to take steps to mitigate the impact of attrition. There are adequate provisions in management science to control employee attrition, and if implemented, these yield positive benefits. However, employers often accept the problem of employee attrition as a fait accompli, ignoring its side effects and moving on.

Thanks,

Dinesh Divekar