Employee stays longer with the same organization the less likely he/she is to resign.
Performing employees are less likely to resign than non-performing employees.
What is Attrition?
A reduction in the number of employees through retirement, resignation or death is called
Attrition.Attrition is also called total turn over or wastage rate.
Why do Employees Leave the Organization?
It is said that people leave their bosses,not organizations. When employees are happy with
their superiors they choose to stay, if not they look for a switch.
So now I see the following reasons to Leave the Boss
• Higher pay
• Work timings
• Career growth
• Higher education
• Relocation to other places
• Women leave the job after marriage to take up their house-hold duties
• Work pressure
• Work Environment
• Poor performance.
• Losing faith on merger/acquisition
• Verbal abuse
Attrition Rate
The rate of shrinkage in size or number of employees is known as Attrition rate. It is usually
expressed in percentage.
Common methodology in calculating Attrition Rate
The approach to this calculation might vary from organization to organization. While a few
techniques are common, there are no proven theories.
The most commonly used formulae are :
Total Number of Resigns per month (Whether voluntary or forced) X 100
-----------------------------------------------------------------------------------------
(Total Number of employees at the beginning of the month + total number of new joinees -
total number of resignations)
Total Terminations in a month
-------------------------------------------------------------------------------------
(Total Head Count at the beginning of the month) + (Total New Hires)
Total No.of employee left X 100
-------------------------------------------
Total No .Of employees present
Number of employee separations-involuntary separations X 100
-------------------------------------------------------------------------------------
*Average employee count
(*Avg. employee count = January month strength + December month strength)
Cost of Attrition's
• Cost of advertising for new positions
• the cost and time involved in interviews and background checks,
• costs associated with search firms or placement agencies,
• relocation costs of new employees
• Training and orientation costs
Consequences of Attrition
Attrition normally brings decreased productivity. People leave causing others to work
harder.
The Brighter Side of Attrition
• A poor performer is replaced by a more effective employee
• A senior retirement allows the promotion or acquisition of welcome 'fresh blood'.
• When business is slack it is straight forward to hold off filling recently created
vacancies for some weeks.
Diagnosing Attrition
Commonly Used Techniques in the Industry
1. Surveys : They are commonly used as part of the information gathering process.
They are a reasonable way of obtaining relevant information, though response rates
are often disappointing. Questionnaires need to be designed carefully to be effective.
They should be easy to use, anonymous and fairly brief. Questions can be open or
closed, multiple choice answers, ranking of items or checklist format.
2. Exit Interviews : Exit interviews are used by the majority of companies. They tend
to be conducted just before an employee leaves, though some firms wait until after
the departure. Exit interviews will normally to be done in the form of a questionnaire,
though one to one interviews are also used.
Here is one article on why employees leave organisation.. hope this might help you to develop strategies and
overcome the reasons for employees leaving organisation.
WHY EMPLOYEES LEAVE ORGANISATIONS ? - Azim Premji, Wipro
Every company faces the problem of people leaving the company for better pay or profile.
Early this year, Arun, a senior software designer, got an offer from a prestigious international firm to work in
its India operations developing
specialized software. He was thrilled by the offer.
He had heard a lot about the CEO.
The salary was great.
The company had all the right systems in place employee-friendly human resources (HR) policies, a spanking
new office,and the very best technology,even a canteen that served superb food.
Twice Arun was sent abroad for training.
"My learning curve is the sharpest it's ever been," he said soon after he joined.
Last week, less than eight months after he joined, Arun walked out of the job.
Why did this talented employee leave ?
Arun quit for the same reason that drives many good people away.
The answer lies in one of the largest studies undertaken by the Gallup organization.
The study surveyed over a million employees and 80,000 managers and was published in a book called "First
Break All The Rules".
It came up with this surprising finding: If you're losing good people, look to their immediate boss.Immediate
boss is the reason people stay and thrive in an organization.
And he's the reason why people leave.
When people leave they take knowledge, experience and contacts with them, straight to the competition .
"People leave managers not companies," write the authors Marcus
Buckingham and Curt Coffman.
Mostly manager drives people away?
HR experts say that of all the abuses, employees find humiliation the
most intolerable.
The first time, an employee may not leave,but a thought has been planted.
The second time, that thought gets strengthened. The third time, he looks for another job.
When people cannot retort openly in anger, they do so by passive aggression.
By digging their heels in and slowing down. By doing only what they are told to do and no more.
By omitting to give the boss crucial information.
Dev says: "If you work for a jerk, you basically want to get him into trouble. You don't have your heart and
soul in the job."
Different managers can stress out employees in different ways � by being too controlling, too
suspicious,too pushy, too critical, but they forget that workers are not fixed assets, they are free agents.
When this goes on too long, an employee will quit - often over a trivial issue.
Talented men leave. Dead wood does'nt.
" Jack Welch of GE once said. A company's value lies "between the
ears of its employees".
Maybe all that is said above may be subjective and may be just perception or maybe prejudice for some but
non the less you need to look at the other side of the coin too.
Attrition and Stress:
Workplace stress and attrition—a direct co-relation?
Growing expectations lead to increasing discontent. This dissatisfaction, if not dealt with
appropriately, ends up boiling down to an uncomfortable situation and an unpleasant word
called ‘stress.’ Renuka Vembu works her way around trying to dissect the relation, if any,
between stress at the workplace and attrition
The buzzing IT sector and the exceeding stress levels and
increasing attrition rates in this industry go hand-in-hand. The
globalization effect and the booming Indian market, the presence
of which is felt across the globe, have their share of challenges
and pressures for the workforce. The evolving sector brings along
with it long working hours, the graveyard shift in the BPO
industry, demanding clients, imposing bosses, adhering to
timelines and meeting stringent deadlines, constant pressure to
perform, excel and be abreast of the latest know-how, multi-
tasking, lack of a perfect work-life balance, all of them in totality
are taking their toll on people.
Decoding stress
The term ‘workplace stress’ does not restrict itself to or imply only ‘work-related’ stress.
This is an obvious and may be an unavoidable symptom.
"Stress is a normal
But the surrounding environment and workplace, office physiological response
to ‘danger’ as
culture and ethics, team enveloping peers, subordinates and perceived by the body
superiors, individual-personality job-fit, job role and function, or brain. The factors
skill sets and training to match it, defining and refining the that lead to stress can
be self-induced as well
same, time management programmes, stress management as induced by the
workshops, recognition for a job well done, job rotation and surroundings'
enrichment, challenging yet reasonable tasks, value added
sprinklings like recreation facilities, concierge services, etc., - KPM Das
go a long way in helping an employee get along with life in a Head Global Operations, Aztecsoft
smoother manner and reflect positive energy. These aspects if
not factored in, end up creating an acrimonious situation.
Emphasis on skills such as time management, effective listening, handling a difficult
discussion, putting the customer first and situational leadership equips employees with the
confidence to maintain a positive work environment and to reduce anxiety in new and
unfamiliar situations.
KPM Das, Head Global Operations, Aztecsoft Limited, explained, “Stress is a normal
physiological response to ‘danger’ as perceived by the body or brain. The factors that lead
to stress can be self-induced as well as induced by the surroundings. In cases where it is
self-induced, the employee may have poor planning and time management skills, low self-
esteem, workaholic nature, inadequate relaxation methods, etc. If induced by the work
environment, the causes could be poor planning and estimation on the part of the
organization or management, culture of rewarding ‘time put in work’ than ‘excellence’, not
creating a cheerful and motivating work environment making work and play go hand in
hand, etc. Managers who are very task-oriented can be very stressful to even excellent
performers who require relationship orientation.”
There are people who also believe that some amount of stress is inevitable as well as
essential to keep the ball rolling. Employees need to be on their toes at all times, ready to
meet the challenges thrown at them, be productive to the best of their capability and keep
the creativity quotient running at all times. While at a certain level employees need to learn
to handle everyday stress to some extent, there are others points in time when it has to be
escalated and a concerned authority has to take charge of the situation and handle the
issue. It is important to bear in mind that employee stress is a subjective matter which
cannot be overlooked; what might appear as a stressful situation for one might be taken as
a normal work routine by another.
"Given the importance "Organizations are
that perceptions play gearing up to provide
in moderating the employees with a
stress response stress-free healthy
relationship, the environment, not only
management can also in terms of better
use effective facilities but enhanced
communication as a work environment and
means to shape employee evolving work culture as well"
perceptions"
- Gowri Shankar Subramanian
- Benny Augustine CEO,
Director, HR, Aspire Systems (India)
Unisys Global Services India
Implications of stress
While there is a clear majority on the fact that stress can lead to attrition, there are others
who do not wish to pin down stress as the ultimate cause, and say it cannot be proven. But
there is unanimity on the view that no particular job function or role or set of people
undergo stress more than others as every task comes with its own baggage of benefits that
can be leveraged and hindrances that need to be encountered. An organization cannot grow
without the growth of its people. Similarly, employee stress shows a direct impact on an
organization’s business. While from the business angle it can affect productivity, client
service, profits and team work, from the individual’s perspective it can lead to deteriorating
morale and self-esteem, low confidence levels, health hassles and a troubled personal life.
Gowri Shankar Subramanian, CEO, Aspire Systems (India), opined, “Organizations cutting
across industries are gearing up to provide employees with a stress-free healthy
environment, not only in terms of better facilities but enhanced work environment and
evolving work culture as well. High stress levels affect the morale and motivation of the
employees. Prolonged exposure to stress without effective coping mechanisms could lead to
a host of physical and mental problems. Stress leads to fatigue, irritability, poor
communication, and quality errors. Workplace stress could also push the employees towards
high risks behavior such as smoking, drinking, and substance abuse.”
Combating strategies
Combating stress is a two-way process. While employees have to come out of the cocoon
and shed their initial fears or inhibitions about working their way out of the stressful
situation, the company has to be accommodative and the environment conducive to foster
employee welfare. Benny Augustine, Director, HR, Unisys Global Services India, mentioned,
“Strategies that management would want to consider include improved personnel selection
and job placement, training, use of realistic goal-setting, redesigning of jobs, increasing
employee involvement, improved organizational communication, offering employee
sabbaticals, and establishment of corporate wellness programmes. Redesigning jobs to give
employees more responsibility, more meaningful work, additional autonomy, and increased
feedback can reduce stress because these factors give the employee greater control over
work activities and lessens dependence on others. Given the importance that perceptions
play in moderating the stress response relationship, the management can also use effective
communication as a means to shape employee perceptions.”
Unmanaged stress can be infectious in large-sized organizations with workforces that are
inhabited together. In addition, a company can easily suffer external image damage from
being perceived as one that has a stressful work environment, limiting its talent acquisition
strategies, among other things. Infrasoft Technologies has the good stories of the
organization told and retold through dash boards and storyboards, during induction. They
get the employees to be a part of all events where the most powerful speaker of the
organization speaks or replays videos of such events during lunch time in cafeterias.
End of stress
Just like everything else in life, stress should be viewed as a temporary phenomenon in a
permanently tough external environment, and working a way around it as a means to a
good end. Kalpana Jaishankar, Vice-president, HR Operations and People Development,
Patni, summarized, “Dearth of staff, shortage of skills, bleak role clarity or growth visibility,
no alignment between organizational objectives and individual goals, complex work and
demanding customers, culminate to employees getting stressed-out, but the decision to quit
is not taken overnight, and attrition due to stress is not the solitary reason. There are
techniques to de-stress, and both the issues and the possible solutions concerning
employees differ according to the hierarchical ladder. Open channels of communication,
show empathy and understanding as tolerating the phases of imperfection and taking a
flexible approach will help iron out the differences and liberate employees of stress.”
One needs to create a corporate ambience that does not perpetrate any other internal strain
in the organization. Complete freedom from stress can never be a reality, whether in
personal or professional life. In any organization, as a manager pushes a team to better the
standards of performance, incorporate new technology and bring up innovative ideas, this
process will inevitably cause stress. The goal is to find ways to manage this stress in a
positive and constructive manner.
Reducing stress to reduce attrition:
Reducing stress is a must to slow employee
attrition
Drug Store News, Nov 25, 1991 by Ted Gladson
• 1
• 2
• 3
• Next
A few years ago it was common to see articles in the popular press about 'burn-out.' Today, it is
common to find articles about stress, the usual cause of burn-out. The terminology has shifted
but the problem remains the same. It has been found in surveys of work-places and conditions
that community drug stores are often stressful places to work. Two adverse effects of this are
reduced productivity and higher employee turnover--both with expensive outcomes for
management. Managers should, therefore, make it their business to remove, to the extent
possible, stress-inducing conditions in their drug store. How is this done and to what degree is it
possible? Is it desirable to remove all stress from the workplace or does it have some value? This
article addresses these questions.
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What causes stress?
Certainly there is an individual variation but, in general, stress occurs when a person feels
conditions are both intolerable and beyond his control. Stress is produced because there appears
to be no relief from the stressful situation except to escape from it, which is the cause of
absenteeism and employee turnover.
A stressful work situation can be due to environmental conditions, induced by co-workers, or the
result of management decisions. Of course, all three may exist and management may be
responsible for the other two causes.
Working conditions
Poor ventilation, inadequate lighting and unfavorable temperatures are examples of
environmental (working) conditions that can induce stress. In many cases it is easier to adjust to
these problems (and they often are less stressful) than problems associated with co-workers or
management. Employees can be especially tolerant of bad working conditions if they perceive
that management is attempting to improve them. However, at some level the conditions can
induce a level of stress that is detrimental to the person and his productivity.
Is it desirable to remove all stress from the workplace? There is a school of thought that some
level of stress is useful to motivate employees. It creates a kind of competitive spirit that, the
argument goes, will encourage people to work harder. This is not a good practice. Stress does not
improve performance. Staff are not motivated by fear except in the very short term. You can
intimidate an employee to do what you want, but that will create the stress that leads to employee
turnover and a level of dissatisfaction that is destructive to productivity. Stress, by definition, is
not good for productivity. Competition can be created in more positive ways if that is the goal. In
summary, stress is not a substitute for proper motivation and when stress reaches some level it
will be counter productive. The manager's task is to prevent it from developing and removing it
where possible.
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Stress will not go away completely, no matter how hard you try or how good a manager you are.
But, through proper management you can reduce it and help employees to manage it so that
stress does not affect their work or personal health.
