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Story characters:

Company name: KMSR Ltd.

Vijay: Manager of Telecom Domain

Ajay: Project Manager

Suma: Project Manager.

Rupa: HR of the Telecom Domain.


Ajay after his ten wonderful years in KMSR Company seems to be disturbed over
the past 6 months about the recent developments in his team. He has moved
through the ranks to the current position. He was one of the top performers of the
company with sound technical skills and always had a good rapport with all the
team members from his early days. Though all the projects under his guidance
were going fine, he felt a sense of dissatisfaction from quite a few of his team
members in recent times and he had already received resignations from four of his
team members.

He was sitting in his new office cabin, after finishing a customer call. He was waiting
for an e-mail from Rupa, for the short listed candidates for the weekend’s interview.
He had raised a request with the staffing function for new resources for his team.
His team was badly hit by attrition.

He saw the reminder flash from his outlook calendar for the scheduled meeting with
Vijay and Suma. The meeting was about to start in 5 minutes time.

He started to move towards the meeting room that was just adjacent to his cabin.
To his surprise Vijay, Rupa and Suma were already there and their concerned faces
clearly suggested what was about to follow .

Vijay and Suma said in a chorus voice . "Hi ,Ajay ", Ajay nodded with a smile.

Vijay said " I think everyone is already aware of what we are here for “ He pointed
at Rupa and said "why do u think the attrition percentage has shot up suddenly?".

Rupa said in a loud and clear voice that most of the employees suggested in the
exit interviews that there were not happy about the appraisal , reward and
recognition system.

Ajay replied " I think we are all aware that the hike in our domain last year was 5%
where as the hike was between 10 to 12% in other domains such as Financials ,
Retail and Pharma. There are also other companies like Technokraft that has been
started in the last one year who has telecom as their main domain and are paying
heavily for the people who have good domain experience "

Ajay added " We cannot fool people suggesting that will be on-site opportunities
for everyone like earlier days as we are already aware that there are already a huge
number of people at on-site and many have been moved to offshore especially in
our domain." Suma began again saying that we could not promote people last year
who really deserved (which would have increased their wages) due to the HR
policies that were laid out as a cost containment measure. The office is also now
shifted almost 60kms away from our earlier location which was within the heart of
the city and was easily accessible. I have already received a lot of requests from
the employees especially women for flexible working hours and work from home
option. It is high time our HR started to review the policy at least for our domain.

Rupa replied in a low tone “It will be difficult to provide work from home options just
for our domain ".

Ajay was not happy with the reply from Rupa and he felt she was not even ready to
consider such an option for further discussion with her top management.

Ajay at the peak of his voice. If there is such a huge difference in the percentage
increase in wages across domains why shouldn’t be a slight change in the HR
policies? Ajay we need some discretion of powers to allow our team members to
work from home”. Currently it is a mandate that every employee should be in the
office for at least 9 hours sign in time which is automatically calculated from their
access cards swipe timings.

Vijay realized that things were getting out of his control and decided to end the
meeting as he was sure no solution would be obtained.

Ajay went to the parking zone and picked up his car. He began to realize that things
are getting worse day by day. He noted that there is already a huge attrition with all
other teams and his team had the least. He was worried about the information
Vijay provided in the morning that that his company has lost a big share of 15% to
the competitors in the telecom domain. Though all his projects were going fine at
the moment his inner sense stated that is high time he finds a new job with a better
company with flexible policies.


1. What are the probable reasons for attrition in any industry?

2. What will you advise to Rupa to arrest the attrition rate going forward?
There are plenty of reasons for attrition
1) Job satisfaction
2) Salary & Perks
3) Work environment
4) Co-workers relation/treatment
5) Pressure of work
6)Family situation
7)Health condition
Geographical location
9) competency
and still go on--and this has already been discussed, we do not want to
again discuss on the same topic

I would like to discuss about manufacturing sector.

See, in mfg sector major focus is given on production rather than the
efforts. Following are the reasons for high attrition rate in mfg sector -

1. There are two bounderies working in factory, one is white color & other
is blue color. There is big gap between these two levels as far as
knowledge, skill & attitude.

2. Due to new MNC's arriving in industrial hub like Pune, the culture also
changing & becoming like their parent company locations like, UK/USA
etc. Now here people would like to balance their personal & work life. If
company culture is not supporting to this then there will be definetely
high attrition rate.

3. As IT companies are growing faster than mfg sector, talent is moving

from mfg sector to service sector. They are basically attracting with the
high salaries & extra perks.

4. Mfg sector are mostly investing into the land, machine & other capital
assets, so there budget is not allowed them to increase salary base as
compare to service sector. So employee are moving from mfg to service

5. Now a days standard of living has been growing very fast, to compare
with the same people are seeking for pleasure & extra facilities and
ultimately they are attracting towards the higher salaries.

and lastly...

6. Ofcourse work pressure, inadequete services, low increments due to

low growth in mfg sector people are moving.

1. People don't get integrated. Most organizations have an orientation program which is more of data-
dump or focussed on compliance trainings being completed. The focus should be more on enabling

employees to form networks within themselves.

2. Performance goals are unclear. In a fast growing team or business the focus is on getting the thing done
today, but rarely are performance goals thought through and employees told as to which resources to

approach for help.

3. Development is always tomorrow's job. Culturally Indians are focussed on learning. If learning adds
value only to the job and not to the overall career goals of the individual then the organizations seems too

transactional for the employee

4. The personal touch is missing. How comfortable are managers building personal bonds with their
subordinates? A lot of managers shy away fearing a bond will make delivering hard messages difficult. I

would argue that it's the other way round! Knowing employees on personal level makes a manager know

their strengths and weaknesses. Work allocation and employee development become easier.
5. Reward systems are not transparent. Most employees who get salary increases because they have a
rare skill at a particular point of time think they got their raise for excellent performance. Can you share

details about how they have been compensated?

6. Percieved equity of reward systems is low. Like it or not, employees discuss salary details and if there
is any percieved lack of equity then you have an issue !

7. Goal setting process is not scientific. Most organizations impose a normal curve fitment, but do not
train managers to set realistic goals or goals that tie up with organizational or functional goals. This also

leads to point number 6

8. External equity is missing too. Don't do an annual compensation survey when the market moves every
3-4 months. If your practitioners feel that externally comparable professionals are being valued more, then

they will leave.

9. No communication around total value. If you offer benefits apart from only monetary terms do you
communicate that to employees too. Things like being a global or niche industry leader, value of the brand of

the organization, should also be made explicit.

10. No career planning. Are people aware of the ways in which they can grow in the organization? Who are
the role models within the organization? Do they know what they have to do to gain the competencies to

move to various levels? (update: Can you be radical enough and create an internal talent market ?)

1) Traditional business organizations in the guise of modern business management

2) Incompetent Bosses
3) In congenial work atmosphere
4) Inadequate perks
5) Favoritisms
6) Suppression of the Talent
7) Employment Market is wide-open to find alternate jobs easily
8) Head-hunting and body-shopping by other good organizations.

* low growth of company

* better opportunity outside
* Strategies are working
* Low corporate image
* Lack of career growth prospects
* Lack of balance between job and persona life
* Lack of support to job performance
* Stagnation in job
* Lack of job satisfaction
* Dual Job responsibility
* Hire and fire accepted practice
* Low mentorship support
* Low self esteem
* Short term goals - Immediate performances

People don't get integrated

Performance goals are missing
Development is always tomorrow's job
The personal touch is missing
Reward systems are not transparent
Goal setting process is not justifiable
Organizational Environment is not people oriented
Team Poaching
Poor communication
No career planning

To curb a high attrition rate

• Top management should communicate continuously with all the employees about the vision and
mission of the company.
• Support HR initiatives aimed at retaining people.
• Line managers or project managers should establish a connection between the lower-level and top
• Manage the company’s growth properly.
• Develop leaders at all levels.
• Train leaders in the skills they need to manage effectively.

For HR managers

• Consider both a person’s culture-fit and job-fit.

• Understand the expectations at the entry level.
• Do not make false promises about benefits.