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Retaining the Employees

Retaining the Employees

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Published by: api-3741487 on Oct 15, 2008
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Retaining that employee

(Tuesday, 16 May 2006) - Contributed by The Financial Express

Desperate companies resort to desperate measures. After losing a string of trained telecom professionals to rivals, the promoter of a small Indian telecom company seemingly lost it. His solution was to limit his employees' access to training and product information to make them unattractive to poachers. In the process he compounded his problems and put his company's future at stake. Ideally, HR should ask itself: “What improvement can be achieved in customer satisfaction and profits with a 10% improvement in retention”. The analysis can be very revealing. The cost of attrition For any company serious about addressing the challenge of attrition, it is important to know why people leave and how much their decision costs the company. Common reasons for employee turnover include growth opportunities outside the organisation and lack of career and development opportunities within the organisation. The cost of replacing a front-line employee, even by conservative estimates, is roughly 0.41 times his/her salary. This, of course, does not include the opportunity lost, so imagine the colossal waste when a talented worker decides to make an unplanned exit! Let’s look at some strategies for improving employee retention: Improve recruitment processes Retention starts with recruitment. You have to get in the right people in order to keep them there. Identify the gaps in your recruitment process and begin to plug them systematically. Early on-the-job attrition can be attributed to a wrong hiring decision, stemming from lack of or poor recruitment processes - a controllable factor. Better planning Better planning relates to both operational and strategic HR issues. At a strategic level, the organisation must clearly define the role and its expectations from the person performing that role. Often the distinction between competency and knowledge is blurred. Career pathing Career pathing must be done in incremental steps, with increasingly enriched scope of work and responsibilities. This must be combined with financial rewards for performance, and linked to an individual’s personal development plan. Train to retain Continuous training and acquisition of new skills holds the key to the success of any retention plan. For instance, hiring undergraduates and allowing them to finish their graduation helps. Employees gain by earning company-paid college education and experience. The company benefits through three-year warrantee on every new candidate! Building employee networks At Novell-India, 26% of all new recruits are employee referrals and 17% are ex-employees, who have opted to return. This not only helps reduce time and cost of hiring, but lays a strong social network and improves employee engagement within and with the organisation. Engage your talent Functional autonomy is desirable. Making your employees your business stakeholders is another innovative method of engaging them. Establish an effective exit interview process Just as it is important to be cautious when you take in a person, you also need to double-check a situation when someone decides to leave. An exit interview process, which incorporates feedback analysis, is thus absolutely essential for addressing these core turnover issues. Build attrition into your business plan Not all attrition is bad. Planned attrition is desirable. The most successful MNCs incorporate attrition into their business models. There is a realisation that some amount of attrition is inevitable and even desirable to bring in fresh ideas and vibrancy to the organisation. Thus, with a focus on measurement, recruitment processes, planning, role clarity and career pathing, it is possible to be in control and improve retention of employees. However, just retention is not enough. What is required is a team of engaged employees.

Source : The Financial Express

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