Employee retention issues and analysis
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The document discusses employee retention issues, highlighting factors leading to attrition such as personal reasons, work-related factors, and supervisory issues. It emphasizes the importance of tracking turnover metrics to identify trends and improve retention strategies, including measures like counter offers and training opportunities. Analyzing attrition rates and employee tenure can help organizations understand retention effectiveness and tailor their approaches accordingly.
Employee retention issues and analysis
- 2. Issues • Too much attrition can result in Uneven workloads Lower employee morale or engagement Loss of business knowledge Lack of continuity, particularly in customer or supplier relationships Problems with quality or productivity • As a general rule, while turnover rates vary with the economic climate, most organizations try to keep turnover below 15% Reasons for Attrition Reasons • Personal Marriage and subsequent relocation Higher Education Need to relocate nearer to family Medical and Personal Reason • Work Salary and Perks (Loans, Vehicles etc) Overseas deputation/Travel Promotion and Career Growth path Desired roles, skills, responsibility, project Better offer from competitor • Facilities Commuting and transportation issues Food & Canteen Timing and Shift-related issues Working conditions and facilities • Supervisor Issues with Supervisors/colleagues; grievances Appraisal related issues Lack of appreciation; harassment Work Culture Leadership & Company Image / Brand Values Attributes to predict attrition Attributes • Personal Age, Gender, Marital Status, Number of dependents • Education Degree, Specialization, College/University, Grade, Marks, and so on • Current Project Projects location, Type of Project, Type of work in Project, Role in Project, Turnkey project flag, Domain, Functional Area, Business Unit, Business sub-unit, Client, HW Platform, SW Platform, SW sub-platform, Employee home location, Duration spent overseas, Total duration in project, Number of role changes in project, Promoted in last year and so on • Past Projects Similar data as above • Experience SCurrent designation, current grade, current role, previous experience, BT experience, Total experience, number of job changes, average job duration and so on • Performance Date of last designation change, Date of last grade change, Last performance rating, current performance rating, last gross salary, current gross salary, percentile salary fit against employees in same grade, average gross salary expected in markets, awards received, current appraisal disagreement raised, papers published, conferences attended, patents applied, and so on • Leaves related Current leave balance for various type of leaves, leaves in current quarter, leaves in last quarter, and so on
- 3. StrategiesforEmployeeRetention • When an employee indicates the desire to resign, HR can offer A Higher Salary (Make a Counter Offer) A Promotion Overseas Deputation Transfer to a location of choice A change of role, or one with higher responsibility Financial assistance or loans Project rotation Training and other competency building initiatives Redressal to any specific grievances Conduct Stay Interviews Conduct Exit Interviews (3rd party after 60 to 90 days from LWD) Get to know what’s important to your employees Focus on Talent Management best practices • Broader means to reduce impact of attrition Pro-active identification of employees at high risk of attrition Training and deployment for “back-up” team members for critical tasks and core employees Improved and effective knowledge transfer mechanisms Creation and implementation of succession plan for leadership positions etc Preparation of a comprehensive and optimal attrition- handling plan, to mitigate the after effects of predicted attrition • Build People skills of middle management • Focus on Capability building and creating an ecosystem where people development is at the fore-front of leadership mindset • Communication on Compensation & Benefits • Engage employees over & beyond their day to day job and ensure that their insecurities and vulnerabilities are addressed appropriately and timely through various programs and practices which could be designed keeping in view organization context and requirements • Provide Growth Opportunities and communicate about them • Managing expectation of employees is a key • Provide opportunities for skill up-gradation through training intervention or internal job assignment / movement • Career Pathing plays a key role • Creating Training Academies with in and also do tie up with institutions • Effectiveness of Reward & Recognition Waystomitigateattrition
- 4. Tracking Attrition Metrics • One of the best ways to put an effective employee retention strategy in place is to track your turnover metrics • What you really need is segmented turnover data. By examining turnover data by location, department and manager, you can identify trends, uncover root causes and take corrective action. You also need to segment your turnover data by employee performance or value. Turnover of low performers might be a good thing for the organization; but you don’t want to be losing an inordinate number of high- performing, high-potential employees, or even a large number of your solid performers. • One final metric that is important to track: Turnover of your top talent compared to turnover for your solid and low performers. Higher turnover rates for your top performers can signal serious organizational problems that need to be addressed. Employee Retention Rate • Employee retention rate is a statistic used by organizations to measure the effectiveness of how well they retain their employees. • Employee retention rate is calculated by dividing the number of employees who left during a period by the total number of employees at the end of a period. Attrition Analysis • Attrition Rate Existing Employee Attrition (Aging analysis) How many of my employees who worked here a year ago today have left view is more important to look at because it tends to show you where slightly more tenured employees leave. This leaves out those that joined and quit in 3 months which is more of a localized recruiting issue rather than a systematic issue in the company. Total Employee Attrition This type of a view displays total attrition by month. It does not discriminate as to which employees quit, whether they were new hires or they were 3 year tenured employee • Employee Tenure Tenured Employee proportion Higher the tenured proportion the better job the company is doing at retention Tenured Employee actual In a growing company however just looking at the proportion of tenured employees to new is not enough. As new hires come in to increase the employee base the Tenured employee proportion would auto-decline. Hence we should also look at the actual number of employees who are tenured • Batch-wise Churn Analysis Is every batch of new hires that join your company the same. Do they perform identically? A view of that can be very useful to study the 'employee lifecycle' to see how they start off and how they perform as they mature. This information can be critical when cross-referenced with the hiring sources and may also be used for recruitment performance.