Holding On To Manpower

Ask any CEO of a big company or an entrepreneur, which is the biggest problem
that they face? Is it increasing topline, maintaining bottomline or trying to
make a foray in newer markets? Chances are the answer will not be any one of
these but the people issues. Whether it is a big conglomerate of thousands of
employees or a small firm with a few dozen on the payroll, the problem of people
management-that is retaining the right person and checking the growing
attrition, are becoming a nightmare for everyone.

While HR managers are prone to lose sleep over the rising rates of attrition,
this problem is now not only limited to the HR departments. Project leaders,
CEOs, CTOs-all worry about how to prevent their competitors from poaching their
staff.

As Neeta Shetty, HR personnel of Bangalore-based Future Businesstech said,
“The biggest concern for our HR department is the high attrition rate. On an
average, I can say the ratio of joining to leaving is 10:3 ie around 33.33
percent.”

Sumanta Pradhan, GM, Pritlink Computer and Communication, Bhubaneswar said
that because of attrition they lose almost 10 percent

of their employees every quarter.

Elaborating about the attrition problem within the SI community, Pradeep
Jhawar, Director, Bard Roy, Kolkata said, “Attrition is a major problemÂ
for the SI/SP community. If any employee leaves the organization with a very
short notice or without any notice at all, the job gets hampered. Although this
problem has got no specific solution, one can try out different ways to control
it. For that the CEO or the director of the organization has to dedicate time
and get involved with his company's overall HR practices. He needs to be very
professional in his approach and open minded while dealing with the employees.
In our company, on an average, two to three people leave in a quarter.”

Companies in big cities are battling attrition every day. Ranjan Chopra, MD,
Delhi-based Team Computers explained the predicament that his company is facing.
“Attrition is one of the problems that really affect the business in a
considerable way. With the loss of a person, you may lose a client or some
business. Therefore, the requirement of the day is to lure your employees so
that they work with you for a longer time. In my company, I hire around 100
people every quarter because of attrition.”

The problem has become so omnipresent that even in small centers, company
heads are feeling the heat. As Arinjay Jain, CEO, Kanchan Computech, Jaipur put
it, “Attrition is surely one of the big problems that all enterprises in each
sector are facing today. These days, people are not satisfied with working in
one company for a long time and they are always looking for better opportunities
due to which they keep hopping from one company to the other. As the adage goes
that 'grass is always greener on the other side', similar is the case with
today's employees. They find other company offering a better environment and
they join it. Once they reach there, they find next company to be better and it
goes on. And that is the reason why attrition is rising at an alarming rate.”

Speaking in the same vein, Satish Choudhary, Director, Techniche, Kolkata
opined, “In eastern India, lack of skilled and trained manpower is a common
problem. It is more so because most of the times, once trained, people move out
or other companies poach quality manpower. In the eastern part of the country, I
think the average attrition rate is around 15 percent at present.”

Money talks

Attrition and retention are two things, which pose a severe constrain to the
finances of the company. When a trained personnel leaves, then not only do you
lose man-hours in replacing and training a new person, you also lose money. In
some instances, companies are known to have lost vital accounts or gotten
delayed in project completion because a skilled employee decided to seek greener
pastures. Also, if you are trying to retain an employee most often than not, it
means paying higher salaries and more perks, which means additional expenses on
the company.

So how big a financial drain is this posing to be for the companies? While
most of the people we talked to were of the opinion that the financial
ramifications of the growing attrition across segments were huge for the
companies, Shetty of EssenVision had started budgeting for it.

There are companies like Team Computers, which are spending around five
percent of their revenues every year on hiring and training new people.

Jhawar of Bard Roy, sharing his experience opined, “The entire process is a
huge loss of time and money. Also the business suffers which leads to further
losses. For instance one of our key employees left the company in January, which
led to subsequent loss of customer and business. In the end, we suffered a loss
of Rs 2 crore in our last turnover because one of our key employees left the
organization during a crucial phase."

Choudhary of Techniche added that attrition was turning into a huge financial
drain for all companies. As loss of employee means hiring either an equally
skilled employee at a probably higher salary or hiring a fresher and then
spending money on training and giving the person time to acclimatize to the work
environment before becoming productive, which means further financial losses. So
according to Choudhary not only is the entire process very cumbersome but also
very costly.

Agreeing to the same, Harish Kumar Shetty of Bangalore-based Binary Systems
said that manpower is a major expense for most organizations. And attrition only
adds to the financial burden as money is spent on training and hiring.
Financials apart, losing people also means that the company loses technical
expertise, customer relationships and business development opportunities. Also
retraining is a very tough task.

Strategies to retain

From a time when unemploy­ment was a buzzword even in the metros and skilled
people were trying hard to find jobs, to a time where getting the right people
for the job, because of the booming job market, Indian industry has come a long
way. The problem of attrition and retention has manifested itself so deep in our
daily work grind that in the DQ Channels SP Summit, that was held in January
this year, the seminar on manpower management was one of the most attended and
debated.

But debates and discussion aside, are there any solutions for this problem?
How can companies retain employees who they deem valuable for their business?
Each company in the past has undertaken various measures of achieving the same.

Choudhary of Techniche, Kolkata opined, “It's very important to retain good
employees. Opportunities are always there and any employee can find a better
option for himself, therefore it is up to the employers to build proper
strategies to retain employees. A couple of years back, one of our senior
employees decided to leave the company to join one of our competitors. However,
before doing so, he also came to us and we had an open discussion about the
same. The result was positive and not only was we able to convince him to stay
back we also accommodated his needs. Infact the strategy stood us in good light
and today that employee works with us.”

Nityanand Shetty of Essen­Vision Software, Mumbai reminisced about his
experience of retaining some of his valuable personnel. “There are two cases
that I can think of in which we were able to retain employees who were on the
verge of leaving. In one case, one female employee who was working with us in
Mumbai got married and had to shift to Lonavala. She was a good employee and was
not very keen to quit either. To accommodate her, we opened an office in Pune
and now she is in charge of driving the business there. There was another
instance where a female staffer took maternity leave and was unsure about
rejoining, as she did not want to leave her child unattended for long. We
ensured she had flexi-timings and today she is one of the most important members
of my team,” he said.

Sharing his story, Jhawar of Bard Roy, Kolkata said, “Sometime back, one of
our marketing coordinators suddenly one day mailed in her resignation and also
stopped coming to office. It was then that I personally called her up and asked
her to meet me. During the discussion, I realized that she had left because she
was sort of abused by one of her colleagues. On further discussion with both the
parties, it was disclosed that there was a severe miscommunication between the
two, which had led to the episode. Once we had cleared out the misunderstanding,
the lady joined back and she is still working with us.”

Sharing her experiences Shetty of Future Businesstech said,” There have been
a couple of instances where we were able to retain employees who were on the
verge of leaving. For example, one of our experienced engineers was going to put
in his papers because of the work pressure. In today's IT industry, the stress
level is so high that the employees at times are stressed out or face burn out.
Thus, counseling the employees every now and then is very much required. In this
instance, we provided extensive counseling to the engineer and we were thus
successful in retaining him.”

However, there are people like Jain of Kanchan Computech who believe that
taking steps to retain an employee who has quit is not a good idea. “If any of
my employees decide to leave, I do not stop him from leaving, no matter if he is
joining my competitor or any distributor. However, while hiring, I make sure not
to take people from them, because I don't find it a healthy thing to do.
Normally, I hire freshers, who have energy and enthusiasm to work because if new
people find good environment, they stay with a company for a longer time,” he
said.

Filtering out the best

While the cross section of people that we spoke to were clear on the need to
draw up a cohesive strategy for fighting attrition and retaining valuable
employees, most companies still did not have the policies in place.

However, like S Nautiyal, CEO, Spark Technologies, New Delhi said, “In order
to retain people, it is imperative to give them work comfort and transparency
with their efficiency. People, no matter at what position they are, never
tolerate partiality, and often get hurt. That attitude must be avoided at any
cost to retain people. Your employees should be happy with the company otherwise
when dissatisfaction takes over, the loss will ultimately be borne by the
company.”

Adding further he said, “You have to create a conducive environment in the
office so that the employees feel like a part of the organization. As the
company grows, they should also see growth for themselves; it should never be a
one-sided process.”

Sharing his method of retaining employees, Chopra of Team Computers
explained, “To retain good people, I assign them work of their interest. I do
not force them to do anything. I ask them execute any task if they are willing
to do so.”

Talking about strategies to filter out valuable employees Shetty of Binary
Systems was of the opinion that one single strategy would not be applicable
across the board. “We do take up measures to retain key people and take all
possible care so that they remain with us. The most successful endeavor has been
highlighting to them the growth path that they have with us. That apart, we try
and inculcate a strong sense of belonging in our key people. Although we have no
plans of going public, we have made them stakeholders in the company and that
has proved to be a big plus for retention,” Shetty added.

Outlining the retention policies that Pritlink has for its employees, Pradhan
said, “We have a four-pronged approach. We not only believe in rewarding
employees for achievement but also work at upgrading their knowledge and skill
by initiating various training programs from time to time. That apart, we always
have regular interaction with our employees and if they are facing any problems,
we prefer to engage them in interactions to be able to solve the problems before
they turn into major issues and people leave us.”

Taking a different view was Bharat Randeri, Proprietor, Wintrek Cables. “In
the Surat market, there is a major issue especially while hiring hardware and
software engineers. For my factory, that is why I hire people from smaller
villages and train them. We also provide accommodation on factory premises for
them and make sure that several other of their basic needs are met. This gives
them a reason to stay. Additionally, I never impart important knowledge to them
nor is any decision making powers given to them.”

Keeping in mind the rising attrition rates Shetty of EssenVision has made
some changes in the way the company hires new people. “Now when we interview a
candidate, we give more onus on the person's character than experience and
training. This is because a person can be trained. But his basic character can't
be changed. So I ask questions which will give me an idea about the person's
plans in life, aspirations, etc and then decide whether to hire the person or
not,” he elaborated.

“We provide our employees with all possible benefits apart from giving them a
very homely as well as professional working environment. We provide facilities
to them like mobile phone, laptops, broadband connectivity in their homes so
that if required they can work from home instead of office. We do a lot of
internal get-togethers, parties and other such activities. This helps to create
a binding with the company and

fellow colleagues,” explained Choudhary of Techniche.

Adding further he said, “That apart, we have special incentives or dividends
for employees doing very well or when the company makes profit. We also provide
various facilities for their families, bonus, and loans from the company for
different purposes. However, the most important part is to make the employees
feel that they are a part of one big family and for that we take special
measures. For eg, a few days back when Kolkata was water logged, our attendance
was over 70 percent and we celebrated the day by making a feast where we did the
cooking and also wrapped up work early. It is very important to make the
employees feel important and valuable and comfortable to bring out the best in
them and retain them,” he summed up.

Whatever be the method or policy, one thing is for certain that the companies
need to be on their toes and keep devising newer methods if they wish to rein in
the rising attrition rates that are becoming the bane of every company.

Shivangi Yadav

shivangiy@cybermedia.co.in

(With inputs from Vinita Bhatia in Mumbai, Subbalakshmi BM in Bangalore,
Amrita Tejasvi in Delhi and Piyali Guha in Kolkata)