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DISSERTATION ON PINK SLIPS Submitted in the partial Fulfillment of the course MBA (HR) 2008-2010 Submitted to: .

Faculty SIKKIM MANIPAL UNIVERSITY, MANIPAL Submitted by: Ramesh Kumar Tripathi MBA (HR) 4th Samester

ACKNOWLEDGEMENT Project work is never the accomplishment of an individual rather it is an amalga mation of the efforts, ideas and co-operation of a number of individuals. I am h ighly indebted to my project guide Ms. Varsha Dixit of Amity International Busin ess School for his invaluable support and guidance during the preparation of thi s project. It gives me immense pleasure to take this opportunity to thank all those who hel ped in the successful completion this project. Ramesh Kumar Tri pathi A1210209A56 IMBA (IB) SEMESTER VIII

1. Executive Summary

People are the backbone of an organization, and the value of an individual can b e quantified. Attrition and layoff are significant problems encountered througho ut the economy and increasing the retention of qualified personnel is an importa nt goal for every company. The battle for the scarce talent on the labor market is fierce, and only popular employers are able to attract and retain sufficient numbers of good people and minimize attrition. Companies are becoming acutely aware of the fact that nowadays employees are qui tting their jobs more often than the case earlier. Attrition as a phenomenon has many long term implications for the organization and cannot be translated only to the quitting of employees. There are many direct and indirect costs than can occur on account of attrition, and thus poses a serious threat to the effective functioning of the organization. When the job marker improves, it leads to a hig h attrition rate. But this alone cannot account for the high attrition figures t hat loom in front of us today. Companies need to invest time in getting close to their employees. They need to look at this as an opportunity to reduce employee attrition. This may require more time spent on employee issues and finding solu tions to their concerns. It s an investment in people. This report provides us lev el and depth to Design a unique platform to cope up with the gap between the dem and & supply of professionals in the competitive world. This report entails reviewing existing frameworks for understanding attrition de cisions and to provide innovative creative ideas for further research on employe e retention. Throughout this report, the focus has been primarily on Attrition in Brightpoint India and recommending the most effective Retention Tool, it also th rows light on the current global market scenario and the downsizing trend being followed by the companies. Section I provides an introduction of the topic with the aid of my own understan ding as well as the parameters from primary and secondary sources. Section II gi ves a specific understanding of the problem, set objectives and methodology adop ted to prepare the report. Section III talks about the objective and methodology used to analyse the project. Section IV presents an overview of wide array of t heories that have developed to understand the employee turnover problems with ef fective retention strategies to counter the same. Section V focuses on the detai led analysis of attrition of Brightpoint India. Also included is a discussion of implications, results and recommendation for both future research policy direct ions.

2. Introduction

education .Avoidable Non-Functional Voluntary: members pushed out by internal factors It is a mere exercise of choice by an employee-a choice to move from one organiz ation to another. skills. Huselid. people still talked about Lifetime Employment and a career with in a company. experience. Attrition sucks knowledge out of the organization .Unavoidable Non-Functional Voluntary: good member pulled out by outside factor s. The fierce competition for qualified workers results from a number of workplace trends. at trition has become a common phenomenon. P rofessor Wayne Brockbank of Michigan Business School remarked in an interview: The human side of business is critical for success. . and by employee characteristics such as age. but one that loses i ts workforce while keeping its equipment. organizations. This is when attrition comes into picture. and organizational tenure. The unspoken emp loyee and employer contract was broken. non renewal of contract . as companies across industries restructu red operations and reduced headcount. intelligence. including: > A robust economy > Shift in how people view their carrers > Changes in the unspoken contract between employer and employee . It also includes his or her ability to learn and grow . collecting experiences and skills in various jobs at various com panies to enhance their ongoing employability and since then job hopping i.Historical Knowledge: This includes the organization s journey from the day it w as founded till present .his or he r intrinsic gifts. knowledge.Functional Voluntary: poor performer leaving . respect for hi erarchy and decision flows.Cultural Knowledge: This includes management practices.e. occupations. values. The HR Scorecard Until early 1990s. often personal . Attrition is the employee s voluntary de cision to leave the organization . operational. process and client information. Starting late 90s.Non Voluntary: medical. APCQ (American Productivity and Quality Centre) has categorized three knowledge types that are under attack thr ough attrition. attitu de. character and drive. There are 4 types of attrition: . departments. U lrich (2001). will find it much more difficult to re cover. This includes: .Functional Knowledge: This includes technical. a 33% rise in demand for talented employees is expected over the next 15 years with a corresponding 15% drop in supply. Attrition rates vary among industries. People then started talking about owning th eir own careers .I. Attrition A company that loses all its equipment but retains its skills and know how of it s workforce would be back into business relatively quickly. geographic locations. . the pendulum started swinging. often in search of better prospects as perceived by the employ ee. According to McKinsey & Company. McKinse y & Company consultants define talent as the sum of a person s abilities. judgment.Becker.

com Apart from the financial losses. The following ta ble gives an overview of the same.Reduction in the productivity of an entire work unit/team.HR Administration .Training . . experienced talent. due to uncompensate d extra workloads.advantagehiring. head hunter fees an d employee development. lower productivity and customer defections.Loss of Productivity Source: www. There are four major costs associated with attrition: . However this does not include indirect opportunity cost such as lost sales. The factors which influence employee to change a job or a company or a career ar e: Source: www. as a result. What can you do for us ( What this will do for you . This cost includes mon ey spent on direct replacement expenses such as advertising. which speci alizes in quantitative HR measurement systems.Rehiring . a average company loses about $ 1 million with every ten professional employees who leave.Barrier to high quality service. According to Saratoga Institute.> > > > > Corporate cocooning A new generation of workers Baby boomers striking out on their own after hitting corporate ceilings Changes in social mores Life balance Attrition is one time considered to be a business cost but it is actually a loss when it comes in terms of revenue. attrition also results in: . stress and tension caused by attrition and.com There has been a change in mindset that has happened with time. Attrition becomes a two fold issue. retain ing much needed and often. one that s cost related and the second. a de cline in corporate morale.employeeretention.

you are hiri ng for a position that allows for growth. While it s true that you may be training employees who will take what they ve gained and leave to work for someone else. and experiences are valued and supported by the organization for which they work. . REASONS FOR HIGH ATTRITION The analysis of attrition aims to identify workers who meet two criteria: they ha ve human capital that the organization values highly and show characteristics th at make them likely to depart. hard hours .Expect lifelong learning.Focus on the job. not the job . and abilities to maintain a high level of marketability in an ever-changing employment market.Demand flexibility. . work styles.Lack of Training People want to strengthen their knowledge. not on the work .Unequal salaries and benefits .Work long.Focus in the work content.Focus on the fun work environment .Depend on the company to provide . and innovation. let applicants know during the employment interview . Employees who find that their differences are just tolerated rather than embraced are likely to leave. . embedded in work . be prepared to offer training opportun ities and career planning. Finding out that they ve been hired into a dead-end job can make employees feel duped. it s just as true that you may be able to cultivate a rela tionship with employees you train and then benefit from what they ve learnt. skills. individualized focus on development . goals. Expect up to date technology Attrition is mainly caused due to the conflict between Generation X and Generati on Y as Generation Y need too much attention and have idealistic and naïve expectatio ns of future career plans . If.Incompatible Corporate Culture Employees need to feel that their interests. . expect flexibility .( What s in it for me Baby boomers (1943-1960) Generation X (1960-1980) Generation Y (1980-2005) . . that alone can make a person walk out the door.Like to do it their way .Strong. however. creativity.Lack of Opportunity for Growth If you know that a position isn t part of a job family and there s no room for prog ression upward or laterally.Work hard.

monetary or otherwise.com/0_features/articles/kicking_retention_strategies.htm II. tools. Even the most experienced employee needs to feel appreciated and r ecognized. . usually . With so many alternative work arrangements available employees with other-than-work interests and commitments are likely to leave an inflexible environment for a company that acknowledges life outside work. It still does!! Employees leave because there is a poor match be tween work and pay.Lack of flexible work There are still many companies that adhere to a strict 9 to 5.The elimination of jobs. They also need to know that the person they report to is available and responsive to their questions or concerns.Money matters. or outd ated computers and other equipment. often without regard to employee performance. while others do just enough to get by--yet the conseq uences. . . Unless they are compensated in some way. . then that they want to know that their work is appreciated. should fit an individual s work style and personality. They re more discriminating about whom to spend time wi th during on-the-job hours. perks and praise are the same. pay. not enough staff This situation occurs with frequency during a tight labour market when employer s cannot find enough workers. Whi le new employees. a workplac e that lacks important facilities such as proper lighting and furniture. keep it up! . The environment in which a person works dire ctly impacts on his or her level of productivity. How you show appreciation. and existing employees are expected to take the sl ack. . are anxious to understand the impact of their w ork on achieving organizational goals. LAYOFF DEFINITIONS . the same is true of workers at all levels . then.Inadequate or substandard equipment. Monday to Friday work mentality. Also when you give out positives--whether it is a pat on the back or a raise in pay--if you give them equally to all performers. all employees need a sense o f direction and guidance. while others are content with an occasional good job ." Treat people on the basis of merit. not seniority or position.Feelings of not being appreciated or valued Most employees genuinely want do a good job.Unsatisfactory relationships at work Employees today accept a more collaborative work environment among themselves. may be all that s needed to cause valuable employees to quit. The following Force Field Model for attrition and retention is stated below: Source: http://tcs. coworkers and supervisors. or facilities Employees may not be willing to put up with poor working conditions. . in particular. and are likely to leave if they don t have a high comf ort level. Most employees think that it's not fair that they work hard every day. and in some instances. If follows. then you en d up punishing the best performers. Some employees require almost constant fee dback on how they are doing.Inadequate Supervision While not every worker requires close supervision.Not feeling part of the company Employees need to sense that what they do fits in with the company overall. As Vince Lombardi is reput ed to have said. these worke rs are likely to leave.Too much work. . benefits. "There is nothing more unequal than the equal treatment of uneq uals.

The de partment should try to provide any support it can to assisting that employee in that period in addition to any the University is able to provide centrally. and to the appropriate unit of local government. We are all tempted to avoid the painful. * . The supervisor is responsible for working with Human Resources to make th e process as humane as is feasible in such a circumstance. cash. health insurance and oth er issue of leaving employment. This is a method whereby an investment banking firm. Regular federal. their families and communities by requiring employers to provide notice 60 days in advance of covered plant closings and co vered mass layoffs. Please call this office and other Human Resources offices if you have any q uestions.In general. as are public and quasi-public entities which operate in a commercial context and are s eparately organized from the regular government. a labor union). will reduce the tim e risk involved due to the difference between entering into the contract and sel ling the shares.. The processes outlined in this document are designe d to help you cope with the policy and contractual mandates for laying off emplo yees. 2. .g.When a company eliminates jobs regardless of how good the employees' performan ce. In other words. The federal Worker Adjust ment and Retraining Notification Act (WARN) provides some protections to employe es who are subject to a layoff. Benefits in Human Res ources stands ready to address questions about pension. Pri vate. Please try to avoid this tendency and s tay engaged with the employee in this difficult time. Permanent layoff is called redund ancy. This notice must be provided to either affected workers or t heir representatives (e. Layoffs are not caused by any fault of the employees but by re asons such as lack of work. MANAGING THE LAYOFF PROCESS . REASONS FOR LAYOFF 1. not counting employees who have worked less than 6 months in the last 12 months and not counting employees who work an average of less than 20 hours a week. The employee is the responsibility of the department through to the actual effective date of their separation. . to the state dislocated worker unit. or material. state.WARN offers protection to workers.A layoff is the reduction of a company's work force in response to a temporary or long-term business strategy or economic condition. they are hedging against any losses due to time . . and loc al government entities which provide public services are not covered. Layoff is a traumatic event for employees and supervisors. 2. employers are covered by WARN if they have 100 or more employees. Remember the Union has a legal role in this process. .Suspension or termination of employment (with or without notice) by the employ er or management.when a company is experiencing financial difficulties. for-profit employers and private. made by investment bankers. We have training services on campus as well as staff who can find outside training sites which can help in finding new employme nt. that minimizes the potentia l downside associated with a commitment to purchase and sell a stock issue unsub scribed by stockholders holding rights. nonprofit employers are covered. A risk reduction. This is usually because the company is facing financial difficulties. Try to set aside ti me to listen to employees facing layoff. who has committed to buy ing up all the unsubscribed shares during a rights offering. such as talking to and working with an emp loyee already informed of their layoff.

in/news/how-to-assist-in-the-layoff-process . In one case.Don't Play the Numbers Game Layoffs can improve a company's processes and morale if leaders refuse to play t he numbers game. the alliance relationships that you established don't add enough to the revenue stream. In the process. and others were duplicating e fforts and creating redundancies. . particularly the people who are being laid off. and while you bring value. But managers armed with that information and the rationale supporting those hard actions can articulate the company's position to both groups. the company should attempt to help terminated employees fi nd other jobs. cut out free coffee. m anagers may blame a business unit's shortfalls on external factors. organizations can fill in swimming pools. sloppiness in a company's management practices also adversely affects long-term profitability. faced th e prospect of workforce reductions on the heels of a big growth spurt. remaining employees realized the company's past ineffic iencies and actually felt energized by the changes. either by providing references or by proactively contacting other companies. my company. . employees who are terminated. and employee s who stay.reduce revenue. she must take a good. grow and expand. Several years ago.a general slowdown in the economy or in custome rs' spending habits -." Finally. eliminate food at meetings. It's human nature for managers to focus their energies on the workers who delive r and to postpone dealing with performance problems. crisp performance reports. leaders must relay information about the company's financial position to the management team and establish prio rities for future decision making. Managers often look high and low to find other costs to cut before they eliminat e jobs. We reeval uated the necessity of staff based on revised financial goals. For the good of its shareholders. They can offer explanations like. Evolutionary Technologies International. Managers' needs are first priority. . http://hrlink. and totally disheartened to elimina te positions and lay people off.Improve Day-to-Day Management Discipline Sometimes external conditions -.Address Financial Priorities However uncomfortable open communication may be. Managers who prioritize this demand can minimize the nee d for future layoffs. Without a clear understanding of why the company has to cut back and how the company can be more efficient after ward. managers cannot convincingly justify their actions to both laid-off employ ees and remaining employees. Organiza tions are thrilled to hire. if possible.Be Humane In triaging a layoff situation. . a company should demand commitment and excelle nce from its workforce. whe n a sales manager sees that her account executives have suffered productivity lo sses over three consecutive quarters. del ay investment spending and forgo bonuses. "The company's cost of sales is too high. leaders should determine "functional silos" where people are not fully utilized. people from two groups were deter mining the same statistic: which customers were scheduled to renew maintenance. Without regular. operations were made more cost-ef fective. However.Layoffs are one of the most difficult tasks talent managers face today. while other regions have steadily improved . Rather than dictating to managers the number of positions they must eliminate. To minimize the number of people affected by a reduction. By aligning our headcount with our real needs. Managers who too easily gen erate a list of names for a headcount reduction probably failed to act earlier o n performance issues. Yet. long look at the performance issues at play in her own b ackyard. leaders should consider the emotional needs of t hree core constituencies: management. Some employees we re not working on vital projects 100% of the time.

1. 3.Work Tenure Grade 3. comprehensive description knowledge about Pink Slips relatin it to two headings: Layoffs and Attrition. 3.com. magazines. Methodology .http://www.30th April 2006 is employ ed for analysis. newspapers.com/articles/2001/05/0501.Analysis of attrition amongst employees (permanent and contract based) in BRIG HTPOINT (in year 2007 and the first quarter of 2008) to get to the root cause of the problem. OBJECTIVE.1 Objective The objective of the Research may be divided into two sub-heads: * Primary Objective * Secondary Objective 3. reviews and journals. magazines and journals to get a clear picture of Attrition .com) has been taken for the purpose of the study. collated and analyzed fro m the HRMS database. The data was taken. Anand Prakash.investorwords.html 3. . Analysis is done on basis of: .html This content can be found on the following page: http://www. data from various internet sites (shrm. insightlink.Assisted the compensation and benefits administrator to make attrition analysi s and devise retention strategies. Malivna Ashok.fastcompany. Human Resources Department * Mr.1 Primary Objective * g To have complete.1.Read through relevant books. * Secondary Data: For this study.Department . .com/2737/layoff.h rsolutionsinc.3.2 Secondary Objective Devise retention strategies to reduce attrition rate and increase employee reten tion in BRIGHTPOINT. . Various other Human resource related sites were refered along with data availab le in books.Reasons . * Mrs. The data has been sourced from SAP ERP Human Capital Management database. DATABASE AND METHODOLOGY 3.Conducted one-to-one interaction with KEY POSITIONS (Department Heads) in my c ompany and then devised on the retention strategies.2 Database Used: * Primary data: Attrition of Bechtel 1st January 2005.Position .Extensive search through the net . Quality Assurance .com.

educators. entry (expectations may be discomforted.2. The models are organized into three categories: those models that focus on process of attrition. skills. When an employee leaves. Mechanical * Mr. and p eople. The stag es are as follows: anticipatory socialization (prior to entry when expectations are developed).1 Attrition Models We use attrition to mean voluntary cessation of membership of an organization by an employee of that organization .4 Limitations: The projections made are according to the current market scenario.1. and others talk of hu man capital and its importance to individuals. when those expectations are unmet . if the market trends change. and adjustment (learning how to do job and how to func tion in the social and cultural environment). industries. human resources. Civil 3. relations with coworkers. and thorough experience. but also the individual emp loyee and wider society (Mobley 1982). which led to a job search. whic h may lead to attrition). 4. CRITICAL REVIEW OF LITERATURE Today we can hear business leaders. In 1960 s. leading to stress. 1992). politicians. which could eventually result in attrition. firms. Employee attrition is a much studied phen omenon. 1994. Organizational socialization models are important to attrition literature primarily because of the third stage. 1986. task variety. Chao at el. Becker stated that: Human Capital is the stock of knowledge. 1985. intangibles. this can have a variety of effects that not only impact on the organization. Jones (1986) identified that the more institutionalized was the socialization.1. 4. Ostroff & Kozlowski. t he greater were job satisfaction and commitment and the lower was the intention . leading to attrition. the result is dissatisfaction. Some outcomes of adjustment are th ought to include job satisfaction. indeed. They argued that employees have individual set of expectations. it can lead to change in the predictions. social capit al. Lambert et al (2001) found work env ironment factors (role conflict. Models that Focus on Process of Attrition Different school of thought support and suggest different reasons for attrition. which could then lead to an intention to quit. and nations.* Mr. there is. These cate gories are not mutually exclusive. autonom y) to be more important than demographics in shaping job satisfaction. and intention to r emain-the same variables found in traditional attrition models. Of ten the meaning of this term is confused with intellectual capital. Becker formulated a theoretical approach to investments in peopl e as investments in human capital (Becker 1962) and has continued to develop the theory ever since. Models that Focus on Socializing Process Employee socialization process is the process by which individuals are broken in as they enter the organization (Allen & Meyer. socializing models and comprehensive models. organizational commitment.1. some overlap. Mobley s (1997) simplistic yet profound model theorized that job dis-satisfaction led to thinking about qui tting. 4. and other concepts related to knowledge. 1990. Fisher. 4. investmen t in education and training. Vijay Luthra. Aval Sethi. and abilities embedded in an individual by natural endowment. Office Services * Rita Bose. Porter and Steers (1973) developed the Met-Expectation Model.

to quit.1.2. including organizational. The model suggests there are four principal determinants of the decision to quit. and non-work values and roles. 4. Comprehensive Model on Attrition Expanded Model. expected utility of alternate roles within the organization.2. Sherida n (1992). namely j ob satisfaction. Hand and Meglino s (1979) This model offers a more comprehensive account because it is multivariate in sco pe. -€Retention processes must directly support the reasons that successful. satisfied employees stay. Source: http://www. KEi's Employee Retention Wheel: KEi's Employee Retention Strategy is base d upon two primary beliefs: -€It is difficult for employers to retain good employees if they don't have a proc ess to hire the right people in the first place.2.com/retention 4. 4. perceived that mismatch between the individual s goals and values and th ose of organization could be the impetus for organizational withdrawal. environmental and individual variables. Mobley Griffeth. The Employee Retention Connection: Employee Retention Connection's decade s of applied organizational experience indicate three Primary Drivers of employee retention: 1: Stimulating Work * Variety of assignments * Autonomy to make decisions * Resources and support provided to do good work * Opportunity to learn * Feedback on results .2 Retention Models Different Schools of thought support and suggest different mechanisms for handli ng employee retention problems: 4. ex pected utility of alternate roles outside the organization.keepemployees.1.3. Allen and Meyer (1990) suggested that commitment could be impacted by h ow the organization tailored the socialization experiences of new hires.

the Asian financial crisis slow down has caused the economy to cool off. they may not have the cu ltural skills to fit in with an organization. In other words. As a result of this shortage. with the job market following suit. and a shortage of skilled employees at the top of the scale can attract the best and the brightest to change jobs often. interest subsidies on loans. and retailing. Finally. While this sum is substantially more than it was five years a . While there are a number of un-employed college graduates in India. marketing. turnover can be a problem. In addition. Salaries in some sectors of the economy climbed at a staggering 40 pe rcent annually during the mid-1990s. generally these individuals are not t rained with the skills needed by multinational employers. free us e of motor vehicles and/or drivers. shortages of skilled workers have led to dramatic pay inflation. and the like ma y all be part of a total compensation package. and to combat turnover rates. pay increases have slowed markedly over the past few years. There are simply not enough candidates with the necessary experience to fill to p roles. increased salaries. Compensation Although pay in India is considerably lower than in Western countries (and even some developing nations). Con sequently. Benefits like rent-free or concessional housing. The best entry-level employees with a high-tech degree from one of India s well-re nowned Indian Institute of Technology campuses can expect an annual salary of ar ound US$14-16. salaries in India account for less than half the value of a typica l compensation package. there is a shortage of talent at the upper end of the employment scale. especially at the upper ends of the scale.* Understanding the significance of one's personal contributions 2: Motivational Leadership * Champion change and are open to new ideas * Inspire a share vision of organization direction * Motivate and recognize contributions * Develop the capabilities of others * Model behavior that reflects organization values 3: Recognition & Reward * Say "Thank you" for a job well done * Reinforce desired behaviors * Create an emphasis and focus on recognition * Celebrate successes * Build self-esteem * Enhance camaraderie and teamwork ERC has developed a Retention Model that transforms organization culture and enha nces competitive edge through the following five-phased approach: Finding talent in India can be incredibly difficult. salaries have raised dramatically in high demand sectors. in almost every sector and to a lesser extent in advertising. as eco nomic growth. Though still b elow the rate of comparable industry segments. while at some levels and in some industries there are many c andidates with the technical skills to fill a position. some Indian candidates with strong skills may not fit the framework of multinational employers because of the historical variations in work practic es. Turnover levels have gone up in many industries.000. although average salary increases continue to significantly outpace the inflation rate of 6-7%. Since then. In addition.

Entry-level emplo yees from second-tier schools receive lower levels of compensation. Benefits The basic salary of an employee in India usually accounts for between 40 and 50 percent of the total package. retention becomes the key i ssue. * modern gymnasiums.200 per year (this l evel is fast increasing). such as the medical transc riptionists employed by multi-nationals who have discovered the cost-advantages of remote processing in the sub-continent. where the majority of India s job hopper s are employed. and thus co ntinue to play vital role in luring and retaining key employees. Among the most significant benefits is housing. a portion of which is not subject to income tax. In addition. . However. or as it is known in the US. employees higher up the corporate la dder in middle management can expect to receive an annual salary range up to abo ut $US30. Employers often reimburse a port ion of the rental costs of the employee in the form of house rent allowance (HRA ). pay a fixed allowance for rout ine check-ups. 000. Other examples of allowances include work clothing al lowances. periodical subscriptions. or undertake a group medical insurance policy. and the like. while the same job in the US would command more than t wenty times as much pay (about $25. allowances may include the entire family s airfare on home leave. and thus will rem ain in demand by employees. even after the new tax rules are enacted. at this time. commuting allowances. ce rtain perquisites like housing. Less skilled employees and those in other industries. a car with a driver is general ly necessary for expatriates who are unaccustomed to such driving conditions. Medical allowances may come in a variety of forms. and * Other amenities. Senior level employees can expect base salaries ranging from abou t $35. Another important benefit is the medical allowance. bene fits still account for a significant part of any employment package. it seems inexpensive at the starting level when compared to the offers that some of these same graduates receive from companies overseas.000 depending on the function and the industry of the employee. India s technology parks stand out as bastions of unexpected affluence. holiday allow ances.000 to $85. Dr ivers and cars are necessary for senior level Indian managers as well. Retention Once a firm manages to find and hire a top employee. Other benefits that might help to attract or retain professionals include gymnas ium facilities. Pay packets may also include a dearness allowance. meaning benefits or allowances are an important part of compensation in India. For expatriates. This is partly because there have traditionally been tax advantages to receiving payment in kind. * food courts. Because of poor road conditions and slow traffic. The famed International Technology Park in Bangalore. and loans (companies often offer their emp loyees very low interest short and long term loans) will continue to be taxed at concessional rates. insurance and loan facilities. receive about $1. club membership s. This is most important in industry.go. Companies may reimburse expenditures incurred by the empl oyee for his own or his family s medical treatment. cars. Depending on the industry and job function. child-care facilities. a cost of living adjustment.000). is indicative of what it takes to retain professionals. In a country where thousands of villages are without electricity or telephones. which will present a significant c ompensation challenge for HR professionals in India. professional education allowances. and the fares of children studying abroad and visiting their parents in India. Proposed changes in India s tax rules will eliminate many of these tax advantages. which boas ts * Self-contained power facilities.

For foreign companies who understand the local labor market and compensation and retention issues. became law. Indians not only work for much smaller sums of mo ney than do other nationals. The Plant Closong Law: Until 1989. For the employer. in that year the Worker Adjustment and Retaining Notification Act. Similarly. it is equally likely to breed employee loyalty. All good companies provide other facets of employee development. who have launched special strategies to develop and strengthen their workforce.1 percent for the quarter ended September. polpularly known as Plant Closing Law. also helped attrition levels come down A look at how companies are holding on to their people: * Anti-poaching agreements * Better perks * Higher compensation levels * Well-laid career plans essential for retaining employees * Better recruiting methods to filter the right people for right places * Balance between performance expectations and growth aspirations II. Although this has caused some logistical problems. However. there were no federal laws requiring notifica tion of employees when an employer decided to close a facility. have done so with significant success. bringing it down to 13. a company that puts all of its j unior employees through a three-month training program. Here's wh at some of the reputed Indian companies have managed to do with their attrition figures: * HCL Technologies successfully controlled its attrition rate. lower than 14 percent in the quarter ended June 30. Although some might contend that training simply makes the employees more saleable. Layoff generally refer s to having selected employees take time off. they often match or exceed other places in terms of quality. as the supply demand imbalance. Nevertheless. the most favored employe r in India. employees may resign to retire or to look for better jobs.The most favored employers will make a significant investment in training their employees. inc luding skills upgrade training and personal development programs on a regular. as some projects lose valued personnel. New Delhi-based Hughes software. o n-going basis. This is especiall y true in today s competitive environment. LAYOFF Non disciplinary separations are a fact of corporate life. It simply gives employees time to seek other work or retaining by giving them advance notice of the shutdown. nor does it re quire aving jobs. India represe nts a significant opportunity. 2004 * Some of the smaller companies were also able to do a better job of controlling attrition * An overall slow-down in hiring by MNCs. 2004. for example. maintaining job satisfaction through variation of duties is importa nt to ensure that employees don t simply leave out of boredom. The law doesnot prevent the employer from closing down. India will remain an attractive market for foreign investment and expansion. has initiated an internal placemen t program that helps employees to move between departments and projects within t he company. For multinational corporations looking to remain cost-competitive. red uced sales or profits may required layoffs or downsizing. Leading Indian services majors. breeds higher salaries and decreased employee loyalty. The law says employers must give advance notice to employees who will experience . a Business Today / Hewitt Associates study rated Infosys. the cost to the company may well be lower than losing the employee to a competitor. Downsizing refers to permanently dismissing a relatively la rge proportion of employees in an attempt to improve productivity and competitiv eness. with the expectation that they wil l come back to work. In addition. where skills quickly become dated and e mployees need constant retraining in order to remain current. Indeed. It requires employees of 100 or more employees to give 60 days notice before closing a facility or starting a layoff of 50 people or more. the costs of doing business in India are rising.

their program included post downsizing announcement activities. face uncertainity and discomfort. upto 60 days. None o f the managers were layoff targets. and to compl ain to disturbed sleep BUMPING/LAYOFF PROCEDURES As noticed above. however. Employers who encounter frequent business slowdowns may have bumping/layoff procedures that let the employees to use their seniority to remain on the job. and marital status. The researchers found that the more managers were personally responsible for handling out warning notices to employees. These manages also debated the relative importance of the skill sets they thought the firm needed going forward. witness the layoffs of their coworkers and friends. which is a permanent serving of the emp loyment relationship. an immediate follow-up in which remaining e mployees were split inti groups with senior managers to express their concerns a nd have their questions answered. provided the more senior person can d o the job without further training. senior manag ement first met to make strategic decisions about the size and timing of the lay offs. Dismissal s effect Dismissal s . layof fs exceeding six months. It therefore makes sense to think through how the firm is going to reduce the su rviving employees uncertainity and boost their morale. with the expectation that they will come back to work. and reductions of more than 50% in employee s work hours during each month of any six-month period. Yet many firms disc over profits don t rise after major personnel cuts. * Management expects the no-work situation to be temporary and probably short te rm. Researchers collected data from 410 managers who either had or had not been in t he position of having to inform subordinates about expected mass layoffs. Front-ine supervisors assessed their subo rdinates..a covered employment loss. an employee in one job ca usually bu mp or displace an employee in another job. Covered employment loss includes terminations. ADJUSTING TO DOWNSIZINGS Firms usually downsize to improve their financial positions. Furthermore. for instance. rating their reunion employees either A. o Seniority can give way to merit or ability.B or C rating and told each that those employees with C grades are designated surplus and most l ikely to be laid off. but usually only when no senior em ployee is qualified for a particular job o Seniority is usually based on the date the employee joined the organization. B or C. gender. the penalty of failing to give n otice is one day s pay and benefits to each employee for each day s notice that shou ld have been given. regar dless of their age. to seek treatment for these problems. downsi zed. and * Management intends to recall the employees when work is again available. three conditions are usually present: * There is no work available for these employees. M ost such bumping/layoff procedures have these features in common: o Seniority is usually the ultimate determinant of who will work. by encour . A layoff is therefore not a termination. Generally. o Because seniority is usually companywide. THE LAYOFF PROCESS A study helps illustrate one firm s layoff process. While there are exceptions. the firm need not notify w orkers it reassigns or transfers to another company location within a reasnable commuting distance. n ot the date he or she took a particular job. including a full staff meeting at the facility. Low morale among those remaini ng is often part of the problem. Some employers. the front line superv isors that informed each of their subordinates about his or her A. In this company. tend to result in deleterious psychological and physical health outc omes for employees who lose their jobs as well as for the survivors who. When Duracell. use the term layoff as a euphemis m of termination or discharge. Inc. and long term support. it is not just the victims and survivors who suffer negativeeffects. With layoffs. the more likely they were to rep ort physical health problems. layoff generally refers to having selected employees take time off.

More than 20. eBusiness solutions.aging supervisors to meet with employees frequently and informally to encourage an open door atmosphere. 5. Yet mass layoffs and downsizings need not trigger the horror stories on eocassionally finds in t he press.000 global customers. BPI has earned a place as trusted partners to B PI customers and suppliers around the world. The Diners Club subsidiary of Citigroup used attitude s urveys to help management monitor how post downsizing efforts are progressing. flexible and cost efficient Through performance and service. product customization. BRIGHTPOINT S effective and efficient platform allows its customer s to benefit from quickly deployed. including some of the industries most successful network operators. BRIGHTPOINT S innovative services i nclude distribution. expand their sales ch . channel development. The people who affect the downsizing and deal with the emplyee questions should factually and truthfully explain what is happ ening and what the employees rights are. BRIGHTPOINT handled 42 millions wireless devices globally. retailers an d dealers rely on Brightpoint to distribute their devices. Guidelines: * Identify objectives and constrains * Form a downsizing team * Address legal issues * Plan post implementation actions * Address security concerns One lawyer says that when employees seek out lawyers after mass layoffsit s often because they re unhappy with how the employer handled the layoff. Information sharing and interpersonal sensitivity can both help mitiga te the otherwise negative effects. fulfillment. COMPANY PROFILE BRIGHTPOINT Inc is a global leader in the distribution of wireless devices and i n providing customized logistic services to the wireless industry. and other outsourced services that integrate seamlessly with its customers.

BPI customers are some of the most successful organizations in wireless. ("Company") believes that effective corporate govern ance is built on adherence to a number of "best practices. retailers an d dealers get more from the strongest brands in wireless. To BPI retail customers. BPI customers can do more. By continually seeking and improving these relationships.Global Markets Brightpoint India-Overview * Founded August 1998. collaborators an d exceptional performers. BPI is delivering on a promise to BPI customers: BPI success is BPI bus iness. Bri ghtpoint is the 'last mile' in the wireless distribution and services value chai n. each one is pre-provisioned for the appropriate network so it arrives ready to sell.000 sq ft of office and Level 3 service center facilities . some of the sharpest thinkers in wireless.1 million in fixed assets invested in India * 51. BPI is proud of BPI role in their success. retail customers can locate discounts and rebates. including a complete l ine of accessories. BPI is committed to reducing any barriers that prevent BPI customers from formin g diverse and dynamic business relationships with us.000 customers supported globally. In handsets. BPI proven processes and experienced staff are aligned to help customers and par tners save time and generate profit. BPI have been helping network operators. Most importantly. BPI is innovators. it's driven by customer goals. The Brightpoint service culture is precisely in sync with BPI customers' needs. O2. for example. At the center of Brightpoint's commitment are Brightpoint people . and when BPI act. Getting products into position to be sold is a core Brightpoint competenc y. * Sole distributor of Wireless products such as Nokia CDMA. Brightpoint 2007 . and is deeply committed to expanding BPI cus tomers' growth. BPI listens more than BPI talk. Kolkata. The Board of Directors ("B oard") of Brightpoint. evaluate and compensate Company executives." These practices are consistent with the Board's responsibilities to effectively oversee the Company' s strategy. providing quickly deployed. Inc. Ahmedabad. With every device shipped. Brightpoint both supplies products and creates opportun ities. by the success of BPI customers. the more successful BPI can be in serving all of BPI customers. track shipme nts and manage their account. these practices are believed to strengthen the Com pany and protect shareholders' interests. world class IT solutions * Over US$ 3. In Brightpoint's online order environment. Chennai. Cochin. fully operational in April 2003 * Key regional centers in Delhi. It's a mindset t hat values customized solutions over off-the-shelf thinking. and Haier in India * Warehouse and invoicing locations across India (22 locations) * Nationwide after sales network. BPI un derstands that when BPI does more. BPI advan ce BPI business mission. Understanding the differences and perspectives among BPI current customers creat es a foundation upon which BPI can build new customer relationships. flexible and cost-effective solutions with a glob al reach. BPI measure BPI own s success. Pune. For more than a decade.8 Level 3 centers * ISO 9001 : 2000 certified. Growing customer relationships are at the core of BPI success.annels and transform their logistical challenges into revenue opportunities. Bangalore. first and foremost. all made evident by the facts: millions of wireless de vices handled annually and more than 20. The more BP I strives to understand and respect each of BPI customer's differences. order products. BPI is intensely committed to helping BPI customers succeed. Mumbai. and plan for management succession.

and BPI are committe d to fostering an environment of diversity that respects and appreciates individ ual differences. BPI has the distribution rights of NOKIA CDMA. channel management. distribution and Customer Support Services network. In INDIA.* 22 warehouses through TPL partner (2 million sq ft available) VISION BRIGHTPOINT INDIA Brightpoint India s vision is to become the number one distributor of wireless telecom products in India. promote and help maintain compliance with policies an d laws. The goods or handsets come from NO . enabling and rewarding achievement. all the sales done in INDIA are done through them. Now the y have also taken the distribution rights of HAIER GSM for INDIA. BPI values allow it to attract. active citizens of the places BPI call home. flexible and cost effective solutions. Learning BPI continually acquires knowledge to improve performance and enable growth. BPI is the only distri butor for NOKIA CDMA. MISSION BRIGHTPOINT INDIA * To provide customized services to network operators and device vendors * To customize. and then the order is placed. honest and fair. Respect BPI treats all stakeholders with dignity and consideration. encourage and support effective d ecision-making. distribute. e-Business solutions and other o utsourced services that integrate seamlessly with its customers. Community Involvement BPI is responsible. So if the company wants to increase its width and depth in INDIA so as to make its presence felt in the market this step shou ld be further increased. providing quickly deployed. Our innovative services include distribution. build employee loyalty and commitment. This could be benefit for BRIGHTPOINT INDIA. Accomplishment BPI fosters a results-oriented environment. fulfillment. select and retain top employees who embody these values. Quality BPI is dedicated to consistently producing results that meet or exceed the expec tations of our customers and suppliers. Logistic used by BPI is SAFE EX PRESS which is the official logistic partner. differentiate it. BPI serves our customers from sales and operations centers located around the world. We will achieve this by becoming the most preferred outsourcing partner for the network operators and manufacturers through a world-class sales. BPI values increase productivity. PROFILE OF THE COMPANY IN INDIA Brightpoint is one of the world's largest distributors of mobile phones. As CDMA sector in INDIA is growing at a much slow er rate as compared to GSM sector. refurbish and repair wireless devices * To provide marketing support for our partners * To provide wireless telecom e-solutions BRIGHTPOINT INDIA SIX CORE PRINCIPLES Integrity BPI is committed to doing what is right. LOGISTICS OF COMPANY:BPI places order everyday to NOKIA for doing so it checks the inventory levels o f previous months. creativity and morale. support ing the global wireless telecommunications and data industry.

FINDINGS AND ANALYSIS The employees of BRIGHTPOINT are divided in to two categories i. Managers Managers/Sr.30th April 2008 50 32 The data reaches the HRMS database through the following process which has been analyzed .Brightpoint Employees (Full Time) .Fo r this regional distributors distribute these handsets in all the regions throug h Sales Executives in that area Brightpoint India-Departments Brightpoint India-Organization Structure Band Band Band Band A B C D : : : : Executives. India) through SAFE EXPRESS.: .e.KIA India (Radisson Gurgaon) to BPI (Okhla. Team Leaders. which place order to stock sheet.Non-Brightpoint Employees (Contract Employees-Agency Based) This table depicts the number of employees left (attrition) during the period 1s t January 2007 to 31st April 2008. Managers/National Function Managers VP/Heads/National Department Managers MD/CEO/CFO/Directors 6. Th e order is placed through SAFE EXPRESS to the registered distributors godowns. Asst. The ord er list is send to registered distributors. € Brightpoint Employees Non-Brightpoint Employees 2007 1st January 2007 31st December 2007 93 38 2008 1st January 2008 .

6. Non-Brightpoint Employees (1st January 31st December 2007) Figure above shows the same trend in statistics as mentioned above.BRIGHTPOINT EMPLOYEES (1st January 31st December 2007) : 38 Figure above shows the similar trend in statistics as mentioned above. Reasons of Leaving Brightpoint Employees REASONS FOR LEAVING BRIGHTPOINT EMPLOYEES (1st January 31st December 2007) : 93 Figure above indicates that most of the employees left Brightpoint for career ad vancement and better compensation.1. Non-Brightpoint Employees REASONS FOR LEAVING NON . The employees being on a contract basis. Employees who do not disclose the reason at t he time of exit interviews are also influenced by better compensation elsewhere. Engineering is a significant department and Non Brightpoint engineers look forward to perman ent jobs which is available due to boom in the industry.1. On Basis of the Department Brightpoint Employees (1st January 31st December 2007) Figure above clearly indicates the attrition of 72 % employees if from Engineeri ng Department.2. 6. In th .31st December 2007) 6.1 2007 (1st January 2007 . and the market bei ng volatile. Market being volatile. As a fresher from universities they accept the jobs offered to them.The attrition has been analyzed on the basis of: 6. The percentag e is as high as 47%. EPC industry being on a boom has resulted in greater demand and less supply of engineers. wh ich is a career advancement for them. the NonBrightpoint employees are getting more options of being a full-time employee.1. the opportunities in the market is much more and employe es are finding lucrative opportunities and enhancement in responsibility outside Brightpoint.1. Employees being in more and more demand in India as well as abroad is resulting in high attrition.3 Work Tenure of the Employee (Brightpoint Employees) (1st January 31st December 2007) Figure above indicates that employees with 0-1 years of experience are more unst able. Most Non Brightpoint employees leave due to career advancement opportunity. Employees in engineering department look forward to better or lat est technologies and enhancement of responsibility.

Middle management is more likely to depart Brightpoint. However we see that employees having work experience 3-5 years is also very high . thus attrition is obvious.H: Grade depict drivers Figure above clearly indicate that employees in middle grade (22-25) i. As we to more years of tenure. Non-Brightpoint Employees (1st January 31st December 2007) Above figures also indicate that employees in their initial years of career are more likely to change the job. We can also notice that second place for attrition is hold by engineers for non-Brightpoint employees. Position of Employee Brightpoint Employee (1st January 31st December 2007) Figure above clearly indicates the attrition of 62 % employees are in the positi on of engineers.Brightpoint employees are involved in initial stages of product or project life cycle. Middle or Senior management) prefer t o stabilize with the job. Also we notice that employees w ith more than 10 years of experience (i. employee s realizations and knowledge of industry r efines and result in attrition from Brightpoint.1.e. 6.1. Non Brightpoint Employees (1st January 31st December 2007) Designers being the non. They are employees who have the know how of the company. Reasons for the attrition in initial years are sa me as explained Brightpoint employees. Designers look forward to permanent or likely to start consultancy for designs i.e.e.5 Grade BRIGHTPOINT EMPLOYEES (1st January 31st December 2007) 21 29 ( Lower grade Highest grade) F. An employee in the position of engineering looks forward to bet ter or latest technology and opportunity.4. 6. Middle management employees lo ok forward to higher positions and compensation elsewhere as compared to senior management s attrition which is less at Brightpoint as indicated in the figure abo ve for grades 27-29. . to start their own business which provides t hem wider platform to work for more organization and wider platform. Moreover en gineering employees get more opportunities in the market compared to other emplo yees as EPC industry progresses on performance of engineering department.e initial year of their career they start realizing the work culture and kind of job opportunities available in the industry and try to change and chose the car eer as per their interests and skill sets.

Market being volat ile.2. The employees being on a contract basis. Most Non Bri ghtpoint employees leave due to compensation (38%) and career advancement opport unity (31%). 6. Brightpoint being one of the best in EPC industry can not be the reason for fres her s to leave for better organizations.2 On Basis of Department Brightpoint Employees Figure above clearly indicates the attrition of 80 % employees if from Engineeri ng Department. Non Brightpo int engineers look forward to permanent jobs and the market being volatile is pr oviding more opportunity and better pay packages and thus resulting in attrition . Non-Brightpoint Employees Figure above shows the same trend in statistics as mentioned above.6.2.2. the NonBrightpoint employees are getting better compensation opportunities and more opt ions of being a full-time employee.Brightpoint Employees Figure above shows the same trend in statistics as mentioned above. As a fresher from universities they accept the jobs offered to them. Engineering department is a very significant department. There is defi nitely a shift in the preference in the employees because in 2007. Fresher leave as they want to work in the . Non.3 Work Tenure of the Employee (Brightpoint Employees) Figure above indicates that employees with 0-1 years of experience are more unst able. Employees being in more and more demand in India as well as abroad is resulting in high attrition.1 Reasons of Leaving Brightpoint Employees Figure above indicates that most of the employees left Brightpoint for career ad vancement (38%) and better compensation being on the second place. Employee s in engineering department look forward to better or latest technologies and en hancement of responsibility. the opportunities in the market is much more and employees are finding lucr ative opportunities and enhancement in responsibility outside Brightpoint. majority of t he employees are now going in for better career advancement. 6. and the market being vola tile. which is a career advancement for them. In th e initial year of their career they start realizing the work culture and kind of job opportunities available in the industry and try to change and chose the car eer as per their interests and skill sets.2 2008 (1st January 2008 30th April 2008) 6.

4 Position of Employee Brightpoint Employees Figure above clearly indicates the attrition of 64 % employees are in position o f engineers. Designers look forward to permanent or likely to start consultancy for designs i. 2008 to April. Non-Brightpoint Employees Designers being the non.fields or area of interest. Also we notice that employees w ith more than 10 years of experience (i. 2008 because equal opportunities are a . Non-Brightpoint Employees Above figures also indicate that employees in their initial years of career are more likely to change the job. most people are leaving in t he engineering department.Brightpoint employees are involved in initial stages of product or project life cycle. 6.H: Grade depict drivers Above figure shows that attrition rate is not affected much by grades of the emp loyees for the period Jan.2. Moreover engineering employees get more opportunities in the market compared to other employees as EPC industry progresses on perform ance of engineering department. employee s realizations and knowledge of industry r efines and result in attrition from Brightpoint.e. As we to more years of tenure.5 Grade Brightpoint Employees 21 29 ( Lower grade Highest grade) F. to start their own business which provides t hem wider platform to work for more organization and wider platform. We can also notice that second place for attrition is hold by engineers for non-Brightpoint employees. As Brightpoint is in the EPC industry.2. 6. Middle or Senior management) prefer t o stabilize with the job. Reasons for the attrition in initial years are sa me as explained Brightpoint employees.e.

57% RECOMMENDATIONS . Summary of the Analysis .00608. of Years] where a = -0.20% April. 2008 28 928 9. 2008 23 849 3.More exit of engineers and designers with specific skill set .Employees within the service period of 0-1 years are the most exiting from Bri ghtpoint . 2008 18 826 2.Most employees (Brightpoint and Non-Brightpoint) are leaving due to career adv ancement and compensation .The market is highly volatile 4 Regression Analysis No. the regression has been percentage has been calculated from January 2008-April 2008 Regression Equation is: y = a +bx [X= No. of Employees Left Total Headcount Cumulative Percentage January.70% March. b = 0.18% February.023787 ?The projected attrition percentage projected is 28.vailable for all grades thus attrition being high in all grades. 2008 22 890 6.28% The assumptions are: .The market being highly volatile.

if the employee knows what they are supp osed to do. A satisfied employee knows clearly what is expected from him every day at wor k (first break all the rule)*. tools. it s easy to find the answer of the needs of the employees. 8. tools. sit on challenging committees. Frequent employee complaints center on these areas should be solved by not wasting any time. A common place complaint or lament I hear during an exit interview is that th e employee never felt senior managers knew he existed. * Failure to provide a framework within which the employee perceives he can succ eed. employees offer ideas. Have meetings or dinner once a month. 2. * Lack of clarity about benefits pertaining to performance based incentives. those employees you want to retain. they feel they will stagnate. 4. * Also considers how the personality and the characteristics of a potential recr uit may fit in well with its organizational policy and climate. The ability of the employee to speak his or her mind freely within the organi zation is another key factor in employee retention. If not. Without the opp ortunity to try new opportunities.RECOMMENDATION TO MANAGE ATRRITION / RETENTION STRATEGIES: GENERAL STRATEGIES: 1. Take time to meet with n ew employees to learn about their talents. temperament or talent. and the ones mo st affecting employee retention method is to equip them with.) tim e.) a congruenc e between the demands of the job and the needed skills. to share the company's vision. The ability of the employee to speak his or her mind freely within the organi zation is another key factor.e. It s not advocating unchanging jobs just the need for a specifi c framework within which people clearly know what is expected from them. When an employee is failing at work. The company should employ: * newspaper advertisements. Changing expectations keep people on edge and cre ate unhealthy stress. It's a critical tool to help employees feel welcomed. The easiest to solve. time and training necessary to do thei r job well or they will move to an employer who provides them the necessities. * University qualifications as the medium to recruit talented cadres. feel free to criticize and commit to conti nuous improvement. The employee must have the tools. Your best employees. acknowledged and loyal.e. attend seminar s and read and discuss books. abilities and skills. * lack of feedback about performance. A career-oriented. 6. knowledge and skill. time and tr aining. 3. The quality of the supervision an employee receives is critical to employee r etention. They rob employee internal security and make the employee feel unsuccessful. (i. seek frequent opport unities to learn and grow in their careers. You'll have more useful information and keep your fingers on the pulse of your organization. Does your organization solic it ideas and provide an environment in which people are comfortable providing fe edback? If so. the industry's growth and where they see themselves in this s cheme of things.The companies facilitate the hiring exercise . 5. Meet with each employee periodically. they bite their tongues or find themselves constantly "in trouble" . training. * lack of clarity about expectations. MAIN RECOMMENDATIONS FOR BRIGHTPOINT INDIA: Recruitment & selection: There is striking differences in the implementation sty le of a hiring exercise. knowledge and abilities of a job candidates (Edward 1991)*. v alued employee must experience growth opportunities within your organization.until they leave. Apart from only emphases recruitment of person & job (PJ) fit (i.

reliabili ty. For instance. The performance of all the executive & managerial level is measured by the set standard implemented by the trainers. Bernthal & Wellins 2002)* * MBA programme. one s output is to be measured so that company expectation from the employee increases with the level of his performance and th rough this way even the employee will get aware of the performance expected out of him by the company. * Customized to company needs. retire ment scheme and insurance coverage) that were becoming less attractive amongst t he highly mobilized younger workforce. can be offered to senior and middle management personnel Training & development: Training and development is one of the main strategies for the MNCs examined in this study to express the worth of their people.. Redesign can also u ndertake on the other traditional fringe benefits (i.e. where the target is to achieved by the employees should be given to them. High performers left for organizations that reward: * Rapid advancement. For instance. Promotion & career advancement: Excellent performance and consistent proven tra ck records must be the recipes for promotion considerations in the company. senior. as wel l as their eagerness to invest and develop exceptional employees. * Cross sectional training. trained assessors. The promotion consideration is facilitated by performance appraisal.e. * Assessment centre: this system is implemented by the third party or can say th rough trainers not from one s own company. Performance appraisal: As part of the attempt to uphold the validity. The new hiring strategy should be a departure from the seniority s ystems in which work experience is valued before entry. offering equally attractive perks that appeal to different groups of employees (i. . the company should put serious efforts on mon itoring and control (i. Fringe benefits: benefit practices are extensive in companies. * extend the medical benefit to the immediate family of the employees * an attractive retirement gratuity * A distinctively unique benefit which allows full reimbursement of education wi thout any contractual binding (Rioux. revision of goals and bi annual re adjustment of key performance index in response to external and internal forces) . Th is method is a very reliable and an unbiased method of measuring the performance of every individual but also. Besides replac ement and retraining. The ways through which company can gat accuracy in the process of performance ap praisal is by adopting other methods. housing subsidy.. that are: * MBO: management by objective. and who prefer real time monetary rewards . yo unger and newer staff across different hierarchical levels). * should be structured. which is to be performed within certain time period an d depending upon the fixed target. Practice of a guaranteed seniority promotion system in the company promotes em ployees in a lock step and it s a time consuming fashion. succession plan ning and performance management system (PMS) to enable sound promotion decisions . as well as to prepare employees for the larger responsibilities that accompany promotion. These social changes have prompted MNCs to practice flexible benefit schemes t o better meet the specific needs of the employees.by placing a great emphasis on the person and organization (PO) fit. The training strategy which if implemented will be more cost effective are: * Training beyond the job scope. and comprehensive develop ment programmes are extended to high performing staff as apart of the succession planning. this method is expensive. the companies invest heavily in training for promotion and succession planning. job specific training is provided for replacement so as to equip n ew recruits with basic on the job skills (Yong 2003)*.e.. The seniority promotion practice becomes a threat to organizational prosperity. and credibility of PA systems. HR department began to work closely with the departmental head to set the select ion criteria.

Avoid mental harassment: there should not be any mental harassment or threat to be given to the employees. for example. The company must meet the decorum of this fact. to have a long commitment with the key employees of the company. in the meeting one employee of the lower department suggested that to make broader mouth of the toothpaste tube instead of the small one. each and every employee either from the top level or the lower bottom l evel should feel a part of the organization. Meditation programs: one of the important things that every company should adopt is the meditation programs to help employees stress relieves and from which the y get inner strength to concentrate more on their work. for example. ESOP s Benefit: faced with a continuing shortage of trained personnel. This makes an employee to feel a difference with the employees of some other companie s. e ven if one is absolutely correct. It makes them nervous.whereas less competitive employees will continue to stay. For example: remembering the one of the past case of Colgate. If this is not possible. This result in proper utilization of human & in human resources with maximum achievement of go als & with minimum losses. Also this will create good impressions on the outsiders. then some selection of days to be drawn on which to wear a proper dress code. Dress code: if possible there should be a dress code of each & every employee ac cording to the department. may be to some extent b ut even that small advice will be fruitful to both of them. no mat ter how one phrase the information. so that the consumption will increase and the demand for the product will automatically go up and his su ggestion was accepted and also the plan resulted in high sales. it can be interpret that the management shoul d involve every employee in the decision making process. * When to meet with some delegates.2000) Therefore to retain the key employees company can even give them the option of E SOPs benefit. The agenda of the meeting w as to implement the practices to increase the sale of the Colgate toothpaste. where a meeting wa s organized involving every employee of the company. And the outcome is that the employee wi ll work with more enthusiasm & with the best of their excellence. etc. . working in the same industry. Therefore from the above example . no matter how one explain the information. This will create a sought of emotio nal bonding between employee & employer. Even if the superior know layoffs loom if an employee fail to meet production or sales goals. six more mutu al funds in India are currently looking at employee stock option plans(ESOPs) as part of their overall human resource management process. * In every monthly meeting. In addition to the four mutual funds that have announced plans to institute a stock ownership program. according to their rec ent report.(Economic times. the Indian mutual fund industry. Participative employer-employee bonding in decision making process: it s a very im portant factor to involve employees in the decision of the company or rather we can say to take them into confidence while taking decisions so that to get more productivity out of them by motivating and encouraging them. from any of the superiors. Organize meets: organize meets once in a year and that should be a family meet so that. Also it helps to increas e the patience level of the employees so that to gain a commitment of long term relation with the organization. it is a mist ake to foreshadow this information with employees.September 4 . is beginning to use employee stock option pro gram to attract and hold desired employees. the best staff members will update their resum es.

Pursuing prime candidates. Personnel Psychology.€€ By: Florida. 208 -225 2. Vol. Bhd.com www.€€ Strategic HR Review. Vol. Debra K. p1-68. Inc. (October. Shah Alam. III. KEEP YOUR BEST EMPLOYEES ON BOARD. p40 -42. International Review of Industrial and Organisational Psychology (Vol. Richard. 5. The Malaysian leaders hip forecast: A benchmarking study. 5 /8/2006..com www. Norton--The Strategy Focused Organization. Robert S. 5 Issue 4.€€ Credit Union Management. Toward a Theoretical Model of Employee Turnover: A Human Resource Development Perspective . Websites visited * * * * * * www. 4/3/2006. 9 Issue 1. Vol.). Diane. Managing for Creativity. Person job fit: A conceptual integration. Mary B. Management in Malaysia (230 250). The Employee Recruitment and Retention Handbook by Diane Arthur. 40(3). Richard. 2001 6. Harvard Business Review. 6. Hiring on the rise. 437 453.T. Human Resource Development Review Vol. 28 Is sue 3. Robertson (Eds. 256 Issue 18. p15-15. The people make the place. 2002). (1991). Jun2006. p124-131 9.€€ By: Stoneman. Vol.com www.com www. Vol.. Available http://www. Drain on the Bottom Line. Apr2006. May/Jun2006. Herman 2.themanagmentor.business. References and Bibliography I.€€ By: Westcott.. & Wellins.R. 283 357).ddiworld. Malaysia: Percetakan Pr intpack Sdn. Voluntary Turnover Among Information Technology Professionals. Vol. 3. (2003). 3 September 2004. Keeping good people by Roger E. Mar2005. Putting your finger on the pulse of employee retention. literature. 83 Issue 7/8.€€ By: Burnes. 7. Edwards. 3.himanresources. B. Development Dimensions Internatio nal. Powers. 7. In Malaysian Institute of Manag ement (Eds. Schneider. K. (1987). In C.€€ (cover story) By: Rubin. Kaplan & David P. Carol.com . Jim. Krizan. Af termarket Business.8. B to B. 2/3p 3.B. Scott. Yong. Korman..com/pdf/ddi_themalaysianleadershipforecast:ab enchmark_wp. Goodbye and good luck. Human resource management. October].hrsolutionsinc. William G. p12-12 II. I llia.insightlink. Cooper & I. p2 5. Books Referred 1. [On-line].. R.pdf [2002. 116 Issue 6.€€ (cover story) By: Krol. Information Executive. New York: Wi ley. p6-6. Bernthal. Tony. and methodological critique. P. Jul/Aug2005. Goodnight. ENR: Engineering News-Record. Journals Referred 1. Patr ick Thomas. Vol.. Vol. S.L. p26-29 4.).com www. 28 Issue 4. Rioux. Jan2006. No.nobscot. 4. 91 Is sue 4. 8.about. J. 6.

retentionconnection.co.winebusiness.imaginerecruitment.insight-hrc.com www.com .employeetentionconnection.teconline.com www.uk www.expresscomputeronline.zinov.* * * * * * * * * www.com www.com www.com www.keepemployees.com www.com www.

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