Attrition Management

Topic introducton
company profile
Introduction to attrition
ur objective
Methodology
Actual study
Analysis/findings
solutions/recommendations
conclusion
a thanks givin note/acknowledgements

Preface

Abstract:

Human resources form an integral component in any business. In fact there

is nothing wrong in saying that the human resources form the backbone of
any organization. Nothing can really match the strength of highly
motivated and enlightened workforce. Human resources are the repository
of knowledge and they provide competitive advantage to any
organization.

At this juncture of rapid changes it is very necessary that the organization

retain their manpower for quite a long period. Attrition is a serious
problem, that the organizations face today. This paper deals into the key
aspects by which this serious problem can reduced to a certain extend.

Key words Attrition, Understanding Human Resources, Empowering

them, Developing them, maintaining them.

INTRODUCTION
The electronic security industry continues to prosper because of the
increasing value that
people place on the protection of their loved ones and their
personal/business assets. The
industry also continues to attract significant investment capital,
management expertise
and debt liquidity due to the healthy economic returns that can be created
within a liquid
market for a predictable cash flow margin enterprise whose root dynamic
is
preservation of the customer, the customers property and the customers
peace of mind
through timely provision of services.
The other important characteristic of the electronic security industry is that
its growth is
often fueled by making an investment in every new customer added. While
the zero or
low down, high volume methods of marketing to increase market
penetration had
transformed the industry in the early to mid 1990s, the return to sounder
customer value
marketing and the reduction of the excessive investment once
considered the only
way to grow, has helped to reduce the necessary investment needed to
remain
competitive in the marketplace. Despite that recent reversal, we still utilize
financial
incentives (leasing, customer transfer/takeover, up-sell/high volume) to
attract customers.
That investment or Cost to Create a Customer can range on average
(2000-2001
activity) between a 15 to 31 multiple of recurring monthly revenue (RMR).
While
market values of RMR have decreased since the altitude ranges of 48 to
60 times RMR
in the late 1990s, they have settled (despite the downward pressure by
the most efficient,
well financed buyers) into the 30s to mid 40s a range similar to the late
1980s when
the industry also had a similar 12,000 to 13,000 dealer participants as it
has today.
The ease of entry that the electronic security industry is still
characterized by, despite
ever increasing licensing and continuing education requirements, continues
to work
against the normal industry maturity trend of settling in excess of 50% of
the marketplace
within a single digit number of companies. Customer retention continues to
be the single
largest management challenge inside a fluid, competitive environment for
customers and
between alternative providers.
Managements priority is to minimize the investment in customer growth.
Some have
commented that it is easy to give security systems away for nothing but
all good
dealers agree that it takes an enormous amount of blocking and tackling
to keep each
customer after any sale. So much management effort and organizational
focus goes into
growing each dealers customer base while often so little effort or
organizational focus
 goes into keeping those precious assets.
Since the late 1980s, when the electronic security industry began to
attract significant
new equity/debt capital, the industry has continued to improve at
gathering and
cataloguing industry specific performance parameters with the SDM 100
and other
public/private information sources beginning to keep track of market size,
growth
dynamics, etc. Despite this new security information age, one continuing
enigma of
2
industry measurement, critical to measuring value created and value lost,
that is not well
maintained or commonly defined, is the qualitative and quantitative
measurement of
customer attrition.
The ensuing discussion will focus on what attrition is, how to measure it, its
intrinsic cost
and how to reduce or limit that basic measurement of poor service. This
critical
measurement needs to be further discussed and gain some consensus both
on the
definition and its utilization within the security industry.
The opportunity at hand is to settle on one or a series of attrition
definitions and methods
to assist the industry with helping to clarify a vital measurement tool for
those who work
within the industry and those who seek to understand the industry better.

Definition

ATTRITION RATE

A factor, normally expressed as a percentage, reflecting the degree of

losses of personnel or materiel due to various causes within a specified
period of time
The rate of shrinkage of manpower in size or number.
Reduction of employees by retirement, resignation & layoff.
A term used to describe voluntary and involuntary terminations, deaths,
and employee retirements that result in a reduction to the employer's
physical workforce.

CAUSES OF ATTRITION

Attrition is an expected yet dreaded cost of business. Essentially, there are two
causes of attrition, which can be grouped into two broad categories
Functional attrition and Preventable attrition.

FUNCTIONAL ATTRITION-
Functional attrition is unavoidable, inevitable turnover. Examples include
employees who retire, employees who leave for a spouse's job transfer, and
employees who leave because of health problems or to care for sick relatives. In
other words, functional attrition is caused by circumstances that can't be
controlled. You must expect and accept this type of turnover.

PREVENTABLE ATTRITION-

Preventable turnover, on the other hand, can usually be controlled and avoided
but often isn't i.e.- Poor hiring practices, misguided policies, low salaries and
inflexible corporate attitudes are some of the preventable reasons people leave
companies.
Preventable turnover occurs when your company can change a policy or find a
solution to keep employees from leaving but doesn't

Reasons & Measures of preventable attrition

a) Lack of job satisfaction Employees resigns because they wants to advance

their career, but their position is a dead end. They are a great employee and
likes their company, but their goals just don't match with their position's
potential.

Suggestion- Company could avoid the resignation by moving them into a

position with growth potential & suitable profile.

b) Stressful work environment - Employee works for long hours with few rewards.
S/He's expected to work 60 hours a week to meet her/is deadlines. They feels
undervalued and overworked. At the end S/He's started looking for another job.

Suggestion- Company could prevent this by setting deadlines that are

achievable in a 40-hour workweek & By offering monetary, non-monetary
incentives.

c) Outside influences Sometimes employee is approached by a competitor

recruiter who promise them paying twice what their company is paying them and
with far better benefits & Employee just take up their offer.

Suggestion-This could be prevented by paying employees what they're worth

and having a comprehensive benefit plan.

d) Conflict with a manager In a team people dont prefer working with less
efficient or careless, lazy person as it hampers their output also or inefficient
person valued just because their team is efficient & valued. As a result conflicts,
unrest is aroused that ends with resignation.

Suggestion- You could prevent this by assigning Bruce to another department

or working with the manager and Bruce on conflict resolution.
The formula and correct logic behind calculation of ATTRITION RATE

Examples:

1) Actual Employees No. Of people left No. Of Joined Total Employees

(Opening BAL) (Attritions) (Current Headcount)
150 20 25 155
So according to the formula: ((20 x 100) / (150 + 25)) / 100
Which comes to 0.1142 i.e. 11%
Now as you had 150 previously and now 25 joined so it makes 150 + 25 =175
Now if you calculate 11.42% of 175 i.e. 175 x 0.1142 = 20
Which clearly shows that 175 - 20 = 155, which is your current headcount and at
the same time you can say my attrition is 11.42% that shows you lost 20
employees of 150 and 25 more joined which makes count to 175.

2) Actual Employees No. Of people left No. Of Joined Total Employees

(Opening BAL) (Attritions) (Current Headcount)
100 50 0 50
This is the special case where we are considering attritions only keeping into
mind that nobody has joined in particular month.
So according to the formula: ((50 x 100) / (100)) / 100
Which comes to 0.5 i.e. 50%
Now as you had 100 previously and now 0 joined so it makes 100 + 0 =100
Now if you calculate 50% of 100 i.e. 100 x 0.5 = 50
Which clearly shows that 100 - 50 = 50, which is your current headcount and at
the same time you can say my attrition is 50% that shows you lost 50 employees
of 100 and 0 joined which makes count to 50.

3) Actual Employees No. Of people left No. Of Joined Total Employees

(Opening BAL) (Attritions) (Current Headcount)
500 200 100 400
So according to the formula: ((200 x 100) / (500 +100)) / 100
Which comes to 0.3333 i.e. 33.33%
Now as you had 500 previously and now 100 joined so it makes 500 + 100 =600
Now if you calculate 33.33% of 600 i.e. 600 x 0.3333 = 200
Which clearly shows that 600 - 200 = 400, which is your current headcount and
at the same time you can say my attrition is 33.33% that shows you lost 200
employees of 500 and 100 more joined which makes count to 400.

4) Actual Employees No. Of people left No. Of Joined Total Employees

(Opening BAL) (Attritions) (Current Headcount)
8000 5000 500 3500
So according to the formula: ((5000 x 100) / (8000 +500)) / 100
Which comes to 0.5882 i.e. 58.82%
Now as you had 8000 previously and now 500 joined so it makes 8000 + 500
=8500
Now if you calculate 58.82% of 8500 i.e. 8500 x 0.5882 = 5000
Which clearly shows that 8500 - 5000 = 3500, which is your current headcount
and at the same time you can say my attrition is 58.82% that shows you lost
5000 employees of 8000 and 500 more joined which makes count to 3500.
Attrition rate is the cost of company

Turnover Cost of Employee

(Calculating Cost per Employee)

The Employee turnover cost is defined as the Percentage of Annual Salary,

including the other cost benefits given to an employee.

It can be calculated using the formula:

[(No. Of attritions x 100) / (Actual Employees + New Joined)] /100

Turnover Cost =

Hiring Cost + Training Cost + Learning Curve Loss Cost + Termination /

Separation Cost + Vacancy Cost

The following questionnaire can help in capturing the details to calculate the
employee turnover cost

Turnover Cost Interview Questionnaire

Exit Interviews

1. Do you conduct exit interviews? {If no, please go to question 4}

2. Who is typically involved in an exit interview? {Please include the number of

individuals involved and their titles/position}

3. How long does a typical exit interview usually last?

Recruiter

10. Do you use recruiters in trying to find qualified candidates? How many
recruiters do you employ? {If none, please go to question 15}

11. What types of activities will a recruiter typically perform?

12. Is this recruiter paid on a consulting or salary basis?

13. If salaried, what is the salary range for a recruiter? If consulting, what is the
typical consulting fee?
{If consulting, please specify the amount of the recruiters time associated with
the consulting fee.}

14. In a typical year, how many new teachers does the recruiter recruit? How
many will actually be hired?
Travel

15. Do you pay any travel costs (either for the recruiter or the applicants) during
the hiring process?

16. If so, what is the average per position?

Processing applicants

17. How do you process applications and resumes?

18. Who handles this task? {Please specify the number of individuals involved
and their titles/positions}

19. How much time is associated with processing applications/ resumes?

20. What types of background checks do you perform on prospective employees?

21. Who is involved in this task? {Please specify the number of individuals
involved and their titles/positions}

22. How many background checks do you typically conduct for a single position?

23. How much time is associated with conducting background checks on a single
applicant?

Interviews

24. How many interviews do you typically conduct for a vacant position? Do you
ever conduct multiple interviews with the same applicant?

25. Who usually conducts these interviews? {Please specify the number of
individuals involved and their titles/positions}

26. How much preparation time do interviewers usually need for these
interviews?

27. How long do these interviews typically last?

28. Once interviews have been conducted, how do you choose which applicant to
extend an offer to?

29. Who is involved in this selection process? {Please specify the number of
individuals involved and their titles/positions}
30. How long does the selection process typically last?

Co-ops

31. Does you district belong to an electronic co-op which does the screenings
and qualifying of applicants? {If not, please go to question 35}

32. What are the costs associated with belonging to this co-op?

33. How does this co-op work? What steps does it eliminate in the hiring process?

34. How many positions in a typical year does your organization hire from the co-
op pool?

Stipends and bonuses

35. Does your organization pay stipends to employees assigned to shortage

areas (niche talent / expertise employees)?

36. In the past year, what percentage of such employees who received niche
expertise stipends?

39. Does your organization pay other bonuses to new employees?

40. In the past year, what percentage of new employees received other bonuses?

Post-employment tasks

41. What types of administrative tasks must be completed after a candidate is

hired? {Ex. establishing payroll, security, benefits, computer passwords, email;
dissemination activities}

42. Who is involved in these tasks? {Please specify the number of individuals
involved and their titles/positions}

43. How long does it typically take for these administrative tasks to be
completed?

Orientation

44. What types of fresher support activities (Induction Plan) do you offer new
joiners? {If none, please go to question 47.}
45. How many new joiners attend these activities in a year?

46. Who is involved in conducting these activities? {Please specify the number of
individuals involved and their titles/positions}

47. What type of time commitment is usually required of the individuals

involved? {Other than the freshers}

48. Are new joiners given any orientation materials? If so, what are the costs
associated with the materials for EACH of them?

Training

49. How is your organization assisting employees with the new requirements for
professional development training associated with certification?

50. For employees in their first year in the company, how much professional
development will you organize? {In terms of cost for training, training materials}

51. How many days are the new joiners dont attend work due to professional
development training?

Turnover Cost Calculations

The following rules are used in all calculations of turnover cost. If any calculation
deviates from these rules, a footnote describes the rule used for the calculation.
Sources of information are also noted.

Estimations of time for the interview: - If multiple individuals are involved in a

task, the reported time is divided evenly among all individuals involved.

Stipends, other bonuses and costs are computed for the amount invested in the
resigned / terminated employee and the amount provided to new joiners filling
the vacant positions.

The final turnover cost can be obtained, by adding up all these costs.

Calculation of Attrition rate

[(No. Of attritions x 100) / (Actual Employees + New Joined)] /100.

Total left out-15

Total joiners-10
Actual strength-130
=[(15*100/130+10)]/100
=[1500/140]/100
=10.7142857/100
=1071428, i.e.- 10.71%

10.71% attrition rate which is bit high & shows the signs of jeopardizing the
company's well being.
 PRIYA : Proactive Retention Interventions among
Young Associates

The young Industry in India has been struggling with high

attrition rates right from the word go. The high cost of attrition in the
established Organizations whose major challenge is to ramp up &
train the workforce quickly to translate the business opportunity into
revenue has already been felt & documented extensively in the
media. Every organization seems to be trying to reduce their
attrition, percentage point by percentage point.

There is a feeling, especially among HR Managers, that while there

are market dynamics involved in the demandsupply gap, there
certainly is a need to find better ways to retain the young & well
trained workforce at the Agent level.

PRIYA (Proactive Retention Interventions among Young Associates) is

a conceptual model that has evolved from HR practices based on
intuitive common sense. It works.
While this author has thought through the Tool elaborated here, a lot
of ideas and practices used in it owe their existence to various HR &
Business Leaders across organizations. Hence this is truly a piece of
collaborative development and should therefore be shared freely for
the benefit of this new growth space.

Let us begin by reviewing the numerous innovative HR initiatives &

interventions that are constantly being tried by most industry leaders
today (Example: Tie up with distance learning MBA programmes,
providing discotheques / fun at work, etc.). Somehow none of these
interventions seem to work consistently across an organization, nor
can they be said to be having a highly significant impact across the
board on the attrition level in the targeted employee population in a
BPO organization handling diverse variety of work. What works for
one organization, seems to be an impossibility to even consider in
another organization.

While these HR interventions & initiatives certainly work in pockets,

there are some limitations in their approach:

1 Business Imperative: The current attrition management outlook

assumes that the absolute attrition percentages are of utmost
importance. Logically however, the Clients would be more worried
about the organizations ability to meet the SLAs (Service Level
Agreement) consistently, and not the absolute attrition percentage
levels. (Yes, lower attrition percentages help quite a lot in that!)

2 CostBenefit: The costbenefit of these HR initiatives are very

difficult to calculate at the design stage. (Usually the cost
calculations do not capture the disproportionate amount of time the
senior management spends in creating, validating, implementing &
troubleshooting these initiatives specially in terms of the
opportunity cost due to time spent away from the business
opportunity)

3 Effectiveness & Impact: The effectiveness of an initiative is

very difficult to predict, and the actual impact is usually out of whack
with the originally estimated level. The choice of initiatives is usually
someones preference / gut feel instead of a very rigorous business
decision. (Since some of these initiatives work, there is a sort of
organizational legitimacy granted to this deciding by gut feel when
it comes to HR interventions related decision-making.)

4 Monitoring & Control: These initiatives / interventions tend to

get out of control quite quickly, and it takes a Herculean effort for the
organizational leadership to rein it in. The organizational leadership
also does not have very clear decision-making data to choose
between similar / overlapping interventions or to stop ineffective
interventions. The in-process monitoring of these initiatives /
interventions is quite difficult given the biases of the implementers &
their varying levels of buy-in.

5 Implementation: The success of most of these HR interventions

is driven by the passion of the implementers, specially the first level
managers. This does create a possibility of a less effective initiative
being continued without knowing clearly that there was a better one
available, and would have had a higher organizational impact, given
the quality of involvement of the first level managers.

6. Focus: These initiatives / interventions are usually backward

looking. They are typically driven by the data from exit interviews of
the preceding month / quarter. Also given the fact that the reasons
why people leave are known to be different from why people stay,
organizations might be aiming the interventions at the wrong
population, if not also a significantly smaller one! Reliability of exit
interview data is another issue, as call-back validation is typically not
a standard practice. One really does not know how many employees
actually joined the organization next door instead of that MBA they
said they wanted to join.

7. Linkage & Alignment: These HR interventions usually do not

provide any linkages to other HR & business processes in the
organization & hence to that extent do not add value. Their
alignment to the overall HR framework is therefore tenuous at best, if
not completely out of sync.

It is in this context that this Retention Planning Tool is extremely

powerful, while being very simple to understand (almost intuitive) &
easy to implement.

The Retention Planning Tool:

The concept of this tool is very simple:
The Value to Company-Probability of Leaving Matrix

Probability of Leaving
Value to
Company

Figure [1]

Identify the individuals in each service delivery team

Plot the position of each of these agents (by the first level
Reporting Manager & the Business HR) in this matrix based on the
given parameters.
 Prepare & implement specific action plans (by the first &
second level Reporting Managers & the Business HR) for enhancing
retention for each individual based on their position in this matrix.
Create this matrix for each Service Delivery Team in the
organization & add up the numbers for each quadrant to understand
what is the most appropriate HR initiative / intervention that is
required.
Monitor & Review these matrixes periodically for any changes
& to obtain decision-making data for discontinuing, modifying,
continuing or initiating new interventions.

The mapping of each individual in the Service Delivery Team is based

on the following Parameters:

Value to Company:
Every individual in each Service Delivery Team to be rated as High /
Medium / Low based on:

1 Current Performance: Productivity, Quality & overall value to

the Team (If this person leaves, how much will it impact the
motivation, stretch & feel good characteristics in the team?).

2 Criticality of the person to the process: Is there a high chance

of the Client migrating the process back / canceling the contract if
this person leaves? Is this one person handling a critical sub process /
language / front-end that no one else in the current team can
handle? In such a case, even if the person is of medium value to
company from point 1 above, he / she should be moved to the high
value category.

3 Longer-term Value: Does this person being part of this process

enhance my organizations chance of getting more business
(upstream / downstream processes) from the same Client? Does this
individual possess relevant experience / qualification / aptitude for
moving into higher value roles likely to emerge in the near future
even if for some other Client / team in the organization?

Probability of Leaving:
Every individual in each Service Delivery Team to be rated as High /
Medium / Low on probability of leaving based on the following 16
parameters.

A High rating in even one parameter would result in a high

Probability of leaving individual. Also please note the correlations &
dependencies within these factors, some of which have been pointed
out. This evaluation assumes that the Business HR person & the 1st
Level Reporting Manager possess a tacit understanding of each
individuals Value System1 (the persons predisposition to act in a
certain way in a specific situation according to the highest operating
value that the person holds).
1 Working relationship with Reporting Manager: Good /
indifferent / strained?

2 Performance rank vs. salary position in the team: Is he / she

getting paid the most in the team if he / she is the top performer?
Individual salary & performance data is no secret as the team
members share them with each other regardless of their
appointment letter instructing them not to!

3 Behavioral and cultural fit in the team: Good / Bad / Ugly?

(Shows high correlation with the team diversity mix, especially with
respect to gender). There typically will be more team issues in an all
female / male team. A good diversity mix always helps. (Given the
typical age profile, there will always be some cases of hormonal
overdrive!)

4 Workplace Location: Is this his / her hometown? What is the

extent of his / her wanting to move back to his / her hometown? (Has
high dependency with 5. There is typically a lot of parental pressure
on the unmarried woman working in the night shift to leave / shift job
to the hometown)

5. Gender Related: Male / Female

1 a. Marital Status: Has high correlation with attrition of

women due to relocation because of marriage.
2 b. Work timing: Day / night. Has high correlation with
attrition of women due to health reasons. (There
appears to be a higher than average number of disturbance in
menstrual cycles & miscarriages for women working in the night
shifts.)
3 c. Spouses work timing: Same / different (If different, has
very high correlation with attrition due to health reasons for women)
4 d. Living with in-laws: There is a 100% correlation of
attrition for married women working in the night shift & living with in-
laws. The in-laws expectations from the daughter-in-law (preparing
breakfast & lunch, attending to the door / phone, housework since
shes at home irrespective of the fact that it is her peak sleeping
time) will force the women to leave her job within about 2 months.
Spouses work timings can further complicate her situation.

6. Aspiration& capability for Higher Education: Aspiration alone is

a bad indicator. Most associates would either intuitively give up on
the tough competition for opportunities in Premiere Business Schools
that they really aspire for, or, simply would not currently have the
financial capability to take a break for preparation or a full time
course. It is only after about 3 years of working that they would be
willing to consider a distance learning option as the only feasible
option.

7. Promotion Prospects: Internal opportunity availability for

vertical movement in the near future. Is my organization growing
fast? Is the new business it is getting similar to my current work? Do
they believe in giving a chance to me rather than hiring someone
above me from the outside? Is the process for promotion fair & does
it happen with a high enough frequency (half yearly)?

8. Opportunity: Internal competition vs. likelihood of getting a

higher position in another organization immediately. Are there any
startups where I can encash my experience today? If I stay, what
are my realistic prospects for moving up compared to my peer
group?

9. Training / mentoring / exposure for growth & learning :

Adequate / inadequate

10. Grievances: Any unresolved / ongoing HR or organizational

issues

11. Reward & Recognition: Have you found an excuse yet to

reward & recognize this individual for what he / she does really well
at work?

12. Need for the job: financial, social or personal compulsions to

continue working.

Time Required:
The first time round, it typically takes about 3 to 5 hours of discussion between
the 1st Level Reporting Manager & Business HR to consolidate the mapping of 10
to 15 people. Subsequent reviews take about 1 hour for a team of 10 to 15
people.

The time required to analyze the mapping & to chalk out a retention plan will
depend completely on the actual details of the mapping as will be brought out
below & in the case study.

Matrix Analysis:
The distribution of the population in the various quadrants (Q1 to Q9) of
the Matrix is an indication of the effectiveness of your Organizations HR
& Training Processes.
If the Matrix Quadrants Q2, Q3, Q5 & Q6 together contain 70 to 80
% of your population, you are extremely lucky. By some happy
accident your organizations people processes work reasonably
well & you are in a good position to initiate interventions which
will basically try to move people in the direction of the arrows & out
from Q3 through promotions as illustrated below (Q7, 8 & 9through
Performance Management, Q4, 5 & 6 through Skills Training & Q1,
2 & 3 through Developmental Training & engagement activities):

Figure [2]
If however the numbers are not so kind, while you will need to still
have the above interventions going, you would be well advised to
create initiatives that will create people movement along the arrows
as illustrated below.

Value to Company
Figure [3]

In other words, you will need to create a well deliberated Churn in

the team to achieve the desired balance within a fixed timeframe
(typically 30 to 45 days) in order to be able to manage the possible
attrition much more proactively & effectively.

A lot of interesting dynamics emerges as you analyse the mapping.

Examples:

1 Those most in need of training are in Q5, 6, 8 & 9. The Q1, 2, & 3s
however resent these uncommitted / still on the learning-curve
individuals being away from work enjoying a good time in training.
Hence ensuring Developmental Training for the next role to those in Q2 &
3 is imperative shortly after the Q 5, 6, 8 & 9s come back from their skill
up gradation training & the heat is turned on them to perform. Q1s need
to be given all the high impact short term assignments (depending on
the actual probability factor of course) which they will usually love to
take up

2 Complete within timelines for the value it adds to their capabilities

& CVs for internal / external movement.
a Are the people decision makers aware of the biggest contributors
in the organization (Q 1,2,3,5,6)? Have these people had a oneonone
with HR / Reporting Managers (First Level & Skip Level) / Business &
Quality Leaders within the last one month / quarter? Have those on PIP
(Performance Improvement Plan) felt the heat directly from the skip level
& HR? If not, theres likely to be trouble ahead.

b What are the other processes on which this team can be cross-
trained? Where else in the organization can the restive population from
my team be moved in a planned manner? Which other teams should I
keep an eye on to create cross-training for my process & backups for
attrition / absenteeism / high volumes in my team. Be prepared for the
Churn much before it becomes imperative.
c All attrition can be traced back to this matrix in order to understand
whether that particular individuals issues were understood / managed
right.

In effect, the preparation of the Matrix is only the first step to an

interesting journey. Once ready, the Matrix will instantly give you the
numbers & impact of any planned intervention or initiative. E.g.: Is the
fun at work initiative likely to retain my high value employees or some
others? How many people are likely to enroll for a sponsored MBA
Programme; a sponsored vs. a reimbursed one; or would my teams best
performers rather have deferred cash payments instead of the MBA
programme? Which Internal Job Posting is just right for my team
member & I should inform & encourage her for the same?

Example: The organization decided to implement a 3-year

distance learning MBA programme on a conditional reimbursement
model. My Matrix clearly told me the realistic number of people likely to
opt for it, their value to the company and how many would choose not to
join because of other factors as discovered while plotting the Probability
of Leaving. I found that the prime reason why the targeted population
would not join was due to cash flow constraints. At Rs 7000 per month
take home, most of them were not in a position to spare Rs. 1500 per
month for this ambitious project. The ones who were in a position to
spare the cash typically wanted to do a full time MBA from a premier
institute for the earning opportunity & entry level / lateral managerial
roles through the superior placement opportunities. (Based on this same
matrix, the data indicated that allocating the budgeted organizational
expense to the performance based variable monthly income* would have
been more effective in creating higher retention at that compensation
level.) One of the Service Delivery Leaders however saw it as a simple
matter of implementation and instructed his Operations AVPs &
Managers that he needed 2% of the population to enroll. After the Yes
Sir, sure enough, there were 36 names identified who would write the
entrance test & enroll. And sure enough, the final tally of people who did
join was zero. I suspect that even if a few of these associates were
cajoled into filling up the form & paying up the Rs. 200 for the entrance
test, they were likely to take pains to flunk the selection test!
 The Matrix therefore gives a clear picture of the current health as well
as the necessary interventions & initiatives required in the team.
Instead of trying to force fit interventions & initiatives designed by
someone high up, the Matrix data flows up & creates a much better
mass customized approach for focusing clearly on the relevant
issues & actions.

A Case Study:

Let us consider a typical distribution matrix for a team of 23 agents, 12 Male, 11

Female.

Value to Company
Figure [4]
Figure[5]
Team Matrix:

Risk of Leaving
Value to Company

P stands for Person; M/F for male / female

Figure [6]
 Case Study: The typical outcome
Nam
Brief Profile Plan
e
Outstanding performer, Manager to resolve difference
has had disagreements across the table, Skip level Manager
with Manager, was not to have one on one to give comfort
nominated to the last that her performance is recognized,
Leadership Development HR to ensure nomination to the
PF1 Training, Conscious of Leadership development &
external opportunities, assertiveness training. Set clear
family reasonably well expectations on lead time to let the
off, is expecting to get Ops Manager & HR know of any
married within this year developments on the marriage
front.
Good performer, has had HR & Skip Level Manager to help
a fight with the Manager Manager in creating a dialogue,
as he did not allow him explaining the context of the
to apply for an Internal decisions. All three to commit to
Job Posting for his working out a solution in the
hometown location as he medium term ( 6 months - 1 year)
had not completed the for exploring his movement to his
stipulated 1 year in the hometown. This would be subject to
process. His father is not the condition that he would be
PM2
keeping well and wants ensuring a backup by training P6 &
him to return to P7 for the critical sub process that
hometown. Manager he alone is currently handling. HR to
denied him leave last proactively seek details of
time as 2 team members Processess at his hometown location
were scheduled for operations & keep him updated of
process training & 2 for future opportunities as well as
six sigma training. introduce him / forward his CV to
key decision makers for the same.
Good performer. Worried HR & Skip Level Manager to ensure
about his prospects of that the transition expected later
growth within the team. would have him handling a meaty
Has capability & prior role. Encourage him to think
experience in a higher through & start creating collaterals,
PM3
end downstream process put him in touch with the Transition
project which is likely to Manager for this next project. HR to
be transitioned in the ensure immediate salary
next 6 months. Salary rationalization.
needs to be rationalized
Outstanding performer, HR to ensure immediate
is also highly critical to rationalization of his salary with
another subprocess. performance. Create engagement at
Process owner (client) work by providing additional
PM4
always wants to speak to responsibilities like involving in a Six
him directly & goes by Sigma Green Belt Project, Shift
his word. Needs to be Utilization initiative for the team etc.
retained.
 Outstanding performer, Ideal person to be groomed for
stable, also critical for promotion to Team Leader /
another sub process. Manager in a structured manner.
Manager to start involving him in
PM5
resolving people issues,
communications, interface with
Clients, internal functions &
enhance situational exposure.
Outstanding performer, 2nd person to be groomed for
PF6 stable. promotion to Team Leader /
Manager in a structured manner.
Outstanding performer, 3rd person to be groomed for
stable. promotion to Team Leader /
Manager in a structured manner.
PF7
Create healthy competition with P5,
& P6 but let all know that there is
room for all three.
Average performer, Counsel, be ready to backfill
attitude problems, peer
group does not like her
PF8
behavior, has been
having health problems
due to night shift
Only married person, HR to immediately try for internal
does not participate in movement to another day
team activities or extend process.Be ready to backfill at short
PF9 help & support to other notice.
team members, is keen
to wind up quickly &
reach home.
Has joined team later as Counsel. Buddy with P5, 6 & 7.
a backfill. Issues with Ensure P5, 6 & 7 get evaluated on
Manager, Salary, Peers, how they handle this case & give
Location. Unable to them active coaching in handling it
PM1 adjust. right. Be ready to
0 backfill.Communicate to P5, 6 & 7
that they will need to stretch
additionally if this person leaves
without notice, and there is a gap
before the backfill is allocated.
Average performer. More Counsel & help in delivering better
PM1 keen on moving up the performance on the job.
1 ladder than in the
current job.
PF12 Ensure hygiene issues are taken
PF13 care of. Train for & create &
PM1 communicate for higher
4 performance on the job. Provide
Average performers.
PM1 additional responsibilities to P16,
5 17, 18 & 19 for SPOCs (Single Point
PF16 of Contact) for the team's HR,
PF17 Training, Tech, Logistics, MIS etc.
PM1
8
PM1
9
High expectations, team Encourage exit after counseling.
PM2 fit issues, higher
0 education aspiration,
does not need the job
Uncommitted, high Explore redeployment to home
PF21 expectation, team fit location, counsel / Exit
issues
PM2 Unmotivated 30 day Performance Improvement
2 Plan (PIP) / redeployment / exit in
Unmotivated that order as there seem to be no
PF23 other major issues.

Conclusion:

While this paper recommends using this Matrix for the BPO space at the
Agent level, the model is sufficiently robust to be used across levels and
across different types of industries simply by modifying the parameters
appropriately. I however think that for industries / levels where attrition
percentages are less than 10% and the attrition impact is not so critical or
immediate in meeting customer expectations; this tool would be more
useful in creating the organizations HR strategy for People Development.

Caution:

Every powerful tool has the possibility of bringing harm due to

misuse. When using the Matrix, please ensure the following:
1 Ensure absolute privacy of the data: Share this data internally
strictly on a need to know basis, & wherever necessary provide the
complete context to each individual & not just the one or two factors
that can be vividly recalled. Even stricter privacy to be maintained to
prevent this data becoming known to the team members.
2 Respect individual merit & right to self-determination: Do not
let this data unduly influence your decision-making in terms of
recommendations for promotions, assignments, hiring etc. Do
address the legitimate business need without compromising on the
organizations values & ethical practices. (Example: if your
organization practices the value of being an equal opportunity
employer, amongst two candidates, you certainly cannot discriminate
by not hiring one person because she is an unmarried female
working away from her hometown. Please remember, each individual
is different and is not necessarily likely to behave in a fashion as
brought out by correlations in historical data)
3

Value System:
A persons predisposition to act in a certain way in a specific situation
according to the highest relevant operating value that the person
holds).
Remember the scene in the movie Deewar where young Amitabh
tries to unsuccessfully steal a loaf of bread? On being caught &
thrashed, he tries to explain that he was not a thief, but he could
simply not watch his ill mother & younger brother go hungry. What it
tells us about the young Amitabhs character in terms of his value
system is that his operating value of being unable to see his family
members in distress is higher than his operating value of not
stealing. Hence under the circumstance, though he did not want to
steal, the higher operating value forced him to.

People with similar social & economic backgrounds tend to have the
same or very similar set of values. However the order in which these
values operate within each person (The higher or lower weightage a
person assigns to each value) could be very different. Example:
Person 1 & Person 2 could have the same top 3 work related
operating values of financial betterment (money), fairplay & status.
The actual order however could be:

Person 1 Person 2
[1] Fairplay [1] Status
[2] Money [2] Money
[3] Status [3] Fairplay

To an external opportunity,both these individuals are likely to

respond very differently: If Person 1 has had reason to feel unfairly
treated in the current organization, he / she is likely to actively look
out for an external opportunity, and will move if the money is better
even if it is at the same level. Person 2 however is likely to consider
opportunities only at a higher designation, and might move for a
higher designation even if the money is not significantly higher.

The PRIYA model assumes that the Ops Manager & Business HR have
a fairly accurate understanding of each team members value system
based on their interactions & past behaviors. Their evaluation of each
associates probability of leaving therefore would be only as accurate
as their understanding of each of their associates value system.
*Performance based variable monthly income: A typical scenario:

Budget : X % of Team CTC# .

Payout : Monthly.
Coverage: 50% of the population every, month. Over the long
term, almost 90% will get paid, even if a small amount, even if only
once in the year, specially when the volumes fluctuate.
Applicability : Revenue generating process which has
stabilized (is meeting customer specifications consistently for at
least two consecutive monthly reviews).
Working : Based on Volume & Accuracy.

Volume: To be eligible, an individual needs to perform at an

output which is at-least Above the team median for last month
OR Above the current months customer required / baseline
volume average for the team whichever is higher (y1).

Accuracy: Above customer specified baseline accuracy. (x1)

Slabs: Different slabs can be created with higher monetary

rewards for higher levels of customer satisfaction. Example, the
slab below can be for Customer Satisfaction (or Overall
Engagement Effectiveness) between 80 to 90 %; a higher payout
can be designed along similar lines for 91 to 95% & so on.
Is Attrition & Retention Bogging You
12 to 18 months' salary for each leaving manager or p
months' pay for each leaving Management or even ho
According to a study by
in the next two years. Most leaving employees seek o
them to use and develop their skills. Leaving employe
in their work meaning challenging the challenges. The
they want to use their qualities and skills in challengin
capable leaders.

Managerial staff cite "career growth" and "leadership"

that influence attrition and retention, together with "o
management" "ability of top management" "use of sk
"work / family balance" Professional employees cite co
"supervisory coaching and counseling," "company dire
work" Clerical employees voice concerns such as "typ
and abilities" and "opportunity to learn" Hourly emplo
they are treated with respect, their "management abi
work"

Employee attrition rate can be never being entirely er

influenced to keep it in control. The business model on
operation runs is significant in achieving this. Outsour
responsibilities that offers challenging tasks to the em
way in helping.