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Employee Retention in Private Sector

with special reference to the Infosys Ltd.
Submitted in partial fulfillment for the
award of degree of
Master of Business Administration


Apex Institute of Management & Science, Jaipur

(Approved by AICTE, New Delhi & Affiliated to Rajasthan Technical University. Kota)




To Whom So ever It May Concern

This is to certify that the project report titled Employee Retention in Private
Sector with special reference to Infosys Ltd.
has been carried out by Ms. Yogita Saini towards the partial fulfillment of the
MBA Degree of Rajasthan Technical University, Kota.
She has worked under my guidance. To the best of my knowledge and belief, this
is an original work and being submitted to the University for the first time.

Mr. Rajat Mahendiratta

(Project Guide)

This project is pertaining to EMPLOYEE RETENTION in the Infosys Ltd., a
leading IT company in Information Technology. I learned and gained the
methods, procedures as well as regulation which make employee retention, a
successful one.
It was a great opportunity for me to understand the significance of corporation
atmosphere and how employees coordinated with the policies and procedures
being issued by their seniors and superiors.
The power sector of company has been expanding concurrently to support the
growth rate surging Indian economy. The demand for man power is growing
exponentially and the scope of growth of this sector is immense.


I am greatly thankful to my project guide, Mr. Rajat Mendiratta, for guiding me

right form the inception till the successful completion of the project. I sincerely
acknowledge him, for extending his valuable guidance, support for literature,
critical reviews of project and the report and above all the moral support he had
provided to me with all stages of this project.
I am also indebted to my family and friends for their sincere care and
unforgettable help in the course of preparing this dissertation to its final shape.

Yogita Saini














Introduction to Industry


Introduction to Organization



Introduction to the topic



Research Methodology



Interpretation and analysis



Facts and Findings



SWOT Analysis



Limitations & Suggestions














In Employee retention the employees are encouraged to remain with the
organization for the maximum period of time or until the completion of the project.
Employee retention is beneficial for both organization as well as the employee.
Employees are different today. They are not the ones who dont have good
opportunities in hand. As soon as they feel dissatisfied with the current employer
or the job, they switch over to the next job. It is the responsibility of the employer
to retain their best employees. If they dont, they would be left with no good
employees. A good employer should know how to attract and retain its
Most employees feel that they are worth more than they are actually paid. There
is a natural disparity between what people think they should be paid and what
organizations spend in compensation. When the difference becomes too great
and another opportunity occurs, turnover can result. Pay is defined as the wages,
salary, or compensation given to an employee in exchange for services the
employee performs for the organization. Pay is more than "dollars and cents;" it
also acknowledges the worth and value of the human contribution. What people
are paid has been shown to have a clear, reliable impact on turnover in
numerous studies.
Today, more and more corporate leaders are turning to volunteer employee
programs as a key strategy to help realize their business goals while positively
engaging their employees in helping to meet the needs of the local community.
Promoting Employee Retention is thus part of the ongoing evolution taking place
in the private sector to move beyond a sole focus on the bottom line to becoming
socially responsible corporate citizens. With more than 90 percent of Fortune 500
companies currently supporting some form of employee volunteer program,
standards for such activities are now being developed to help track their impact
on the community and improve employee volunteer program practices.

The growing interest in these activities has triggered some important questions.
Why is volunteering in the community important in the first place? What are some
of the challenges facing companies as they get more involved in employee
volunteer efforts? What are some of the benefits and added value for local
NGOs? Given the time pressures at the workplace, what are the most effective
and efficient ways to mobilize volunteers? What have we learned over the past
few years that can help both companies and local NGOs work together
successfully to promote such efforts? To address some of these questions, we
have chosen to highlight examples of how the staff of one company - Lucent
Technologies has supported the work of the International Youth Foundation
(IYF) and its partner organizations in the field.
In this instance, Lucent staffs are contributing their time and talents to youth
programs managed by the global Fund for Youth Development (GFYD), an
initiative of IYF and the Lucent Foundation (now called Alcatel - Lucent

Introduction to Indian IT and BPO industry

The Indian IT industry consists of the hardware, software and ITES-BPO
sectors. India is already being termed, as the ITES-BPO sectors. Capital of the
world, even though its IT spend is a small fraction of the US. Most of the major
global players have set up offshore facilities in India and all these facilities have
started growing. There are over 200 companies participating in the ITES-BPO
segment and the numbers are growing every year services
The rationale for IT-enabled services to base operation in India is that it allows
them to capitalize on time zone differences and provide services round the clock,
each day of the week(24 7) . The sustainability of this value propositions makes
India a high priority destination for locating ITES. Global giants are looking at
ITES outsourcing providers in a situation where bottom lines eroding and cost
competitiveness is becoming increasingly important as more and more
companies turn to specialist players to handle portions of their in-house functions
and activities.
The Indian IT-enabled business services referred to as the ITES-BP segments
continues to chart strong year-on-year growth, estimated at 37 percent for FY
2005-06. Growth is being driven by a steady increase in the scale and depth of
existing service lines, and by the addition of newer vertical-specific and
emerging, niche business services.
India ITES-BPO (re-classified) exports are estimated to have grown from USD
3.1 billion in FY 2003-04 to USD 4.6 billion in FY 2004-05, recording a growth of
nearly 48 percent and are estimated to reach USD 6.3 billion by the end of fiscal

IT exports are expected to grow by 27-30% posting revenues of USD 29-31

billion. The domestic market is expected to grow by 20 % on the back of
implementation of e-governances initiatives and increasing automation in key
sectors like retail, health care, etc.
The ITES BPO segments also provide a major opportunity for job seekers. By the
year 2009, the segment is expected to employ over 1.1 million Indians. The
ITES- BPO sector in India is projected to account for 7 percent of Indias GDP
and 35 percent of total exports by 2009. India offers a distinct set of advantages,
which make it a referred destination for ITES. India already has a number of IT
enabled services providers who collectively cover a wide range of services, with
different levels of complexity and value addition.
India can sustain its global leadership position, grow its offshore IT and BPO
industries at an annual rate greater than 25 percent and generate export revenue
of about USD 60 billion by 2010. Additionally, export growth can be further
accelerated through deep and enduring innovation growth by the industry. Such
extensive innovation could generate an addition USD 15-20 billions in export
revenues over the next ten years. In addition to delivering USD 60 billion in
export revenues by 2011, Indias off shoring industries can generate another
USD 15-20 billion of export revenues over the next ten years,
This will require deep and enduring innovation across three dimensions:
a) Business model innovation (e.g. focusing on new services lines like
infrastructure off shoring)
b) Knowledge innovation ( e.g. Developing deep IP-based solutions); and
c) Ecosystem innovation (e.g. systematic talent enhancement, better
technology research, more seed-stage capital). Indias economic growth
will be greatly accelerated if the India based IT and BPO industries sustain
their global leadership and are able to generate approximately USD 60
billion in export revenues by 2011. At this level these two industries alone
can contribute 1 % per year to GDP growth for the next five years.

They would employ nearly 2.3 million people and provide indirect and induced
employment for another approx. 6.5. Million workers Indias off shoring industries
could well become one of the worlds great export industries at par with Frances
luxury goods industry.
International Data Corporation (CDC) forecast that BPO services sales from
India will grow from USD 709 million in 2003 to about USD 2572 million in 2006
at a CAGR of 52 percent. T he marketing BPO services are expected to grow
from a US D609 million business in 2003 to USD 2188 million in 2006 at CAGR
of 62 percent. According to NASSCOM keeping in line with the performance of
the software sector , IT enabled services also witnessed explosive growth in the
last two years and ITES exports are likely to touch USD 21-24 billion by 2011.
The leading publicly-listed players have reported a top line year-to-year
growth of nearly 34 percent, over the first half of the current fiscal. MNCowned captives units have been scaling up their operations steadily
steadily with the headcount forecast to grow by at least 30 percent of
tithes year. IT-ITES activity in the domestic market is also witnessed
steady growth with the services segments coming into its own reflecting
sound optimism for the year end results.
Indias software and services sector grew by a healthy 31.4% to USD
29.6 billion during 2995-06. Exports capitulated by 33% to USD 23.6
billion. Growth in the sector to continue in 2006-07.It expects revenue to
grow by 27-30% to USD 36-38 billion.
India, presently accounts for about 0.6% of the global IT hardware
production of USD 1200 billion. The domestic market is estimated at 44
billion US while exports amount to 425 billion. The investments in
hardware manufacturing, however, stand at a mere Rs. 1300 crones.
Indias hardware requirements in 2010 are estimated at 78 USD of which
54 can be sourced from the domestic market. Hardware continues to
account for a major share of the domestic IT-ITES spend- 53 percent of
the total in FY 2004-05. In spite of continued pricing pressure in key

categories, domestic hardware revenues grew by 22-23 percent in FY

2004-05, and these are expected to maintain similar growth rates in
current fiscal. Key vertical marks include telecom, BPO, BFSI,
manufacturing and education.

Demand for hardware systems remained strong in FY-2004-05 with serves as

well as singular user systems averaging a 30 percent volume growth. Desktops
and notebooks taken together grossed 5.04 million units registering a growth of
32 percent over the last fiscal.
Desktop sales crossed 4.6 million (46 lakh) unit registered an annual growth of
27 percent while the notebook shipments exceeded 0.43 million (4.3 Lakh) units
growing 144 percent over 2004-05.
With sound macroeconomics conditions and buoyant buying sentiments in the
market, Desktop sales are expected to cross 5.6 million (56 lakh) units in Fiscal
year 2006-07 while overall PC shipments would exceed 6 million units. The
growth in PC sales on th one hand, can be attributed to significant consumption
by industry verticals such

as telecom, banking

& financial


manufacturing, retail and BPO/IT enabled services as well as major eGovernance initiatives of the Central and State Governments. On the other hand,
the drop in prices, especially at the entry level: has contributed to a strong
household market.
The southward trend in pricing continued during the year due to technological
reasons and other initiatives of the industry, including the sub- Rs. 10,000 PC.
The year 2005-06 also witnessed aggressive market campaigns with celebrity
endorsement for IT products. Significant consumption in the small and medium
enterprise added to the industry numbers. Further, the trend of increased PC
purchase in smaller towns and cities as witnessed in the previous years,
continued undiminished.
The proportion of the assembled PCs the smaller lesser known regional brands
and unbranded systems, reduced from 41 % of the total PC sales in 2004-05 to
37% in 2005-06, however, in absolute terms they registered a growth of 14%.

Aggressive pricing from the branded players cannibalized the market for the
assembled PCs.
A proportion of the Indian grew from 24% in 2004-05 to 28%, registering a growth
of 48%. The market share of the MNC remained constant at 35%, however, they
registered an annual growth of 27%.
Household, with sales growth of 33% accounted for 12 % of the market. Within
businesses, sales to the larger businesses (over 50 employees) grew by 38%; to
the medium business segments (between 10 to 50 employees) by 17% and that
to small enterprise by 45%.
In terms of processor configuration, PC sales in 2005-06 were dominated by P4,
which accounted for 80% of the market share, while alternative processor like
AMD, Via Cyrix etc. accounted for another 17%.Consumption of PCs with
alternative processor grew by 139 % in absolute terms. In households,
alternative processor accounted for 26 % of the market, a reflection of the higher
price sensitivity in the home market.
Overall printer sales grew by 28% over that in FY 2004-05.The sales Is of laser
printers recorded a consumption of 0.32 million (3.2 lakh) units, growing 128%
over the last year. The resurgence in the market for dot-matrix printers as
witnessed two years ago , continues undiminished in 2005-06. Sales of the dotmatrix printer grew 18% over 2004-05.
Sales of inkjet printers grew by 13%v led by consumption in households and
smaller cities. The growth projection for FY2006-07 for overall printer sales is 23;
sales are expected to cross 1.8 million (18 lakh) units. The figures are a result of
an extensive study conducted by MAIT & IMRB.
India has maintained its global competitiveness offering the best combination of
cost quality- scalability vis--vis competing offshore destinations such as the
Philippines and China. The Indian productivity- quality- cost model has emerged
as an optimal value proposition for the software and service industry.


Like the service sector, Indian ITES-BPO companies are adopting global quality
standards like six sigma, COPC, ISO 9001 etc. while MNCs dominates the ITESBPO space, a increasing number of Indian companies are making a foray into
this sector.
Presently the ITES-BPO industry in India is segmented along the following lines:
Specialized, vertical-specific IT enabled services include:

Medical transcription

Legal database processing

Digital content development/animation

Online education

Remote maintenance

Engineering and design

General IT enabled services include:

Contract centers


Consumer care

Technical support

Back office operations, accounts , financial services, etc

Data processing

The BPO industry has extended its lines of service to value-added areas like
packaged software implementation, system integration, (R&D), engineering,
engineering design, biotech research, research outsourcing, customer analytics,
market research, and equity research.


The BPO market can be broadly broken down into three areas of functional
1. Business administration (falling under G&A expense costs)
2. Supply chain management(COGS) , and
3. Sales, marketing and customer care(selling and marketing costs)
The Indian BPO business is entering a new phase with several Indian
companies acquiring small to medium size businesses in the US and Indian
companies spreading wings globally.
This new trend marks a milestone in the development of the Indian BPO sector,
which is now growing faster than software services.
Essar, Datamatics, Godrej and Internet, jointly owned by TCS and HDFC, form a
growing a list of Indian companies that have in the last few months acquired BPO
businesses overseas in the footsteps of HCL, which pioneers the process by
buying a BPO company in northern Ireland two years ago.
Indian ITES-BPO service providers realizing the huge business potential are
expanding their presence in the ITES-BPO market. The addressable global
market for offshore IT is around US$ 150-180 billion. Going forward, the
more traditional IT outsourcing service lines such as hardware and software
maintenance, network administration and help desk services will account for
45 percent of the total addressable market for off shoring and are likely to
drive the next wave of growth.
Service lines that have driven recent growth i.e. application development and
maintenances (AMD) and R $ services are already 30-35 percent penetrated and
are not as likely to grow dramatically.
The addressable market for the global BPO industry is equally sizeable and
could expand by more than 10 times from its current size of approx USD 11.5
billion at least USD 120-125 billion.


BPO growth will be driven largely by traditional industries ( e.g. retail and
banking) and cross industry function such as human resource and finance and
accounting. While the addressable market for the global offshore IT and BPO
industries is quite large industry evolution will largely be shaped by the interplay
of three major forces:
1. Supply( the capacity and quality of offshore locations)
2. Demand ramp up (realistic off shoring by companies) and
3. Industry conduct ( the actions taken by industry players)
Approximately 35-40 percent of the total addressable market will be
captured in the next five years. For example, while around USD 300 billion
can ultimately be relocated from sources countries to low-cost offshore
locations, industries estimates indicating that approx USD110 billion will
actually be off shored by 2011. The global offshore IT and BPO industry
are subjected to different constraints that will impact their ability to address
the full market opportunity. The offshore industry is more likely to be
demand- constrained

is market growth will largely be driven by the

adoption rate of companies in sending/source geographies . This in turn

will be driven by the willingness to offshore and more importantly by the
organization preparedness of these companies. On the other hand, the
BPO industry is more likely to be supply constrained due to potential talent
shortfalls within the receiving / servicing geographies
The tenth plan working group on information technology had projected a
hardware production of Rs 69000 crones for the year 2006-07 as a
reasonable scenario for the tenth plan . This leads to a CGAR of about
15% for the overall manufacturing sector during the tenth plan as
compared to 10% in the ninth plan.
A more aggressive projected scenario would lead to a total production of Rs
90,900 Crores in 2006-07 corresponding to a CGAR of about 22%. India has the

potential to develop and manufacture IT hardware for the global market and gain
higher global share. The hardware industry is estimated to reach USD 69 billion
by 2011.

Future Employment Generation

The total direct employment in the Indian IT-ITES sector is estimated to
have grown by over

a million from 284,000 in FY 1999-2000 to a

projected 1,287,000 in fiscal . In addition to the nearly 1.3 million strong

workforce employed directly in the industry in 2006 , Indian IT_ITES is
estimated to have helped create an additional 3 million job opportunities
through indirect and induced employment includes expenditure on
vendors including telecom, power, construction, facility management , IT
transportation catering and other services.
Induced employment is driven by consumption expenditure of employees
on food, clothing, recreation, health and other services. From a current
employment of 1.3 million in 2006, India will need a 2.3 million strong IT
and BPO workforce by 2010 to maintain a shortfall of nearly 0.5 million
share qualified employees-nearly 70 percent of which will be concentrated
in the BPO industry.
The gap can be bridged by the following initiativesa) Expending the pipeline of people willing to join the industry
b) Improving the quality of the potential and current workforce
c) Better matching jobs to people so that attrition is reduced

India needs to deliver on both basic as well as business infrastructure. Thus the
India IT and BPO industry need at least five new gurgaon-plus and seven new
pune-plus integrated townships. The resulting burden on urban infrastructure is










breakthrough public-private partnerships and innovative financing. In addition the

current infrastructure and development process will have to be dramatically
Note that this infrastructure building does not require substantial public financial
support since there is a robust business case for adding both the basic and the
business infrastructure.
India based IT and BPO providers have retained their cost leadership position
despite increasing wages rates. This has been accomplished through greater
automation and code reuses, as well as tighter people management. Sustaining
industry leadership will require India based players to continue to drive down total
costs and improve quality.
For example , both offshore IT and BPO customers are now demanding beyondcost value propositions. IT services players need to focus on three key areas
a) Enhance customers interaction and solution delivery
b) Improve resource management
c) Upgrade support processes


Business process outsourcing (BPO) is a broad term referring to outsourcing
in all fields. A BPO differentiates itself by either putting in new technology or
applying existing technology in a new way to improve a process.


Business Process Outsourcing (BPO) is the delegation of one or more ITintensive business processes to an external provider that in turn owns,
administers and manages the selected process based on defined and
measurable performance criteria. Business Process Outsourcing (BPO) is one of
the fastest growing segments of the Information Technology Enabled
Services(ITES) industry.
Few of the motivation factors as to why BPO is gaining ground are:

Factor Cost Advantage

Economy of Scale
Business Risk Mitigation
Superior Competency
Utilization Improvement

Generally outsourcing can be defined as- An organization entering into a contract

with another organization to operate and manage one or more of its business

Different types of services being offered by BPOs

Customer Support Services
Our customer service offerings create a virtual customer service center to
manage customer concerns and queries through multiple channels including
voice, e-mail and chat on a 24/7 and 365 days basis.
Services Example: Customers calling to check on their order status, customers
calling to check for information on products and services, customers calling to
verify their account status, customers calling to check their reservation status etc,
Technical Support Services


Our technical support offerings include round-the-clock technical support and

problem resolution for OEM customers and computer hardware, software,
peripherals and Internet infrastructure manufacturing companies. These include
installations and product support, up & running support, troubleshooting and
Usage support.
Service Example: Customers calling to resolve a problem with their home PC,
customers calling to understand how to dial up to their ISP, customers calling
with a problem with their software or hardware.
Telemarketing Services
Our telesales and telemarketing outsourcing services target interaction with
potential customers for prospecting like either for generating interest in products
and services,or to up-sell/promote and cross sell to an existing customer base or
to complete the sales process online.

Service Example: Outbound calling to sell wireless services for a telecom

provider, outbound calling to retail households to sell leisure holidays, outbound
calling to existing customers to sell a new rate card for a mobile service provider
or outbound calling to sell credit or debit cards etc.
Employee IT Help-desk Services
Our employee IT help-desk services technical problem resolution and support for
corporate employees.
Service Example: of this service include level 1 and 2 multi-channel support
across a wide range of shrink wrapped and LOB applications, system problem
resolution related to desktop, notebooks, OS, connectivity eyc., office productivity
tools support including browsers and mail, new service requests, IT operational
issues, product usage queries, routing specific requests to designated contacts
and remote diagnostica etc.


Insurance Processing
Our insurance processing service provide specialized solutions to the insurance
sector and support critical business processes applicable to the industry right
from new business acquisition to policy maintenance to claims processes
New Business/Promotion:
Inbound/outbound sales, initial setup, Case management, Underwriting, Risk
assessment, Policy issuance etc.

Policy Maintenance/ Management:

Record Changes like Name, Beneficiary, Nominee, Address; Collateral







Overpayment, and Customer care service via voice/email etc.

Data Entry Services/ Data Processing Services

Service Example:

Data entry from Paper/Books with highest accuracy and fast turn around

Data entry from image file in any format

Business Transaction Data entry like sales/ purchase/ payroll

Data entry of e-books / Electronic Books

Data entry : Yellow Pages / White Pages Keying

Data Entry and compilation from web site

Data Capture/ collection


Business Card Data Entry into any format

Data Entry from hardcopy/ Printed Material into text or required format

Data Entry into Software Program and application

Receipt and Bill Data Entry

Catalog Data Entry

Data Entry for Mailing List/ Mailing Label

Manuscripting typing in to word

Taped Transcription in to word

Copy, Paste, Editing, Sorting, Indexing Data into required format etc.

Data Conversion Services

Service Example:

Conversion of data across various database on different platforms

Data Conversion via Input/Output for various media

Conversion from Page maker to PDF format

Conversion from MS-Word to HTML format

Conversion from Text to Word Perfect

Conversion from Text to Word to HTML and Acrobat

Convert raw data into required MS Office formats

Data Compilation in PDF to Word/ Text/ Doc

E-book conversion etc.

Scanning, OCR with Editing & Indexing services

Service Example:

High Speed Image- Scanning and Data capture services

High speed large volume scanning

OCR Data from Scanned page/ inage

Scan & OCR paper book in to CD.

ADOBE PDF Conversion Services


Conversion from paper or e-file to various formats

Book Keeping and Accounting Services

Service Example:

General Ledger

Accounts Receivable and Accounts Payable

Financial Statements

Bank Reconciliation

Assets/ Equipment Ledgers etc.

Form Processing Services

Service Example:

Insurance claim form

Medical form/ Medical billing

Online Form Processing

Payroll Processing

Internet/ Online/ Web Research

Service Example:

Internet search, Product Research. Market Research, Survey, Analysis

Web and Mailing list research etc.

Challenges for a HR Professional in BPO

Brand equity: People still consider BPO to be low-brow, thus making it difficult
to attract the best talent.


Standard pre-job training: Again, due to the wide variety of the jobs, lack of
general clarity on skill sets, etc., there is no standard curriculum, which could be
designed and followed.
Benchmarks: There are hardly any Benchmarks for compensation and benefits,
performance or HR policies. Everyone is charting their own course.
Customer-companies tend to demand better results from outsourcing partners
than what they could actually expect from their own departments. When the job
is being done 10,000 miles away, demands on parameters such as quality, turn
around timeliness,
Information security, business continuity and disaster recovery, etc, are far higher
than at how. So, how to be more efficient tan the original?
Lack of focused training and certifications
Given this background, the recruiting and compensation challenges of HR
departments are only understandable.

Key to success
The key to success in ramping up talent in a BPO environment is a rapid training
module. The training component has to be seen as an important sub-process,
requiring constant re-engineering.
Business Process Outsourcing: The Top Rankers
WNS has emerged as the top BPO in India, pushing Wipro Spectramind to the
second position, according to a survey done by NASSCOM. The basis of ranking
is the revenues generated by the BPO companies in 2003-04, as per US GAAP.
A list of top fifteen BPO companies in India is given below:


1. WNS Group
2. Wipro Spectramind
3. Daksh e-Services
4. Convergys
5. HCL Technologies
6. Zenta
7. ICICI Onesource
8. MphasiS
9. EXL
10. Tracmail

The parameters for th survey was: Employee Size (operation level executives,).
Percentage of last salary hike, cost to company, overall satisfaction score,
composite satisfaction, company culture, job content/ growth, training salary and
compensation, appraisal system, people preferred company ( percentage of
respondents of a company who named their own company as the preferred one,)
dream company; (percentage of respondents in the total sample who preferred a
particular company)
Employee benefits provided by majority of the BPO companies
Provident Fund: As per the statutory guidelines, the employee is required
to contribute a percentage of his basic salary and DA to a common fund.
The employer for this fund contributes as well. The employee can use the
deposited in this fund for various personal purposal purposes such as
purchases a new house, marriage, etc.
Gratuity: Gratuity is one of the retrial benefits given to the employee in
which the employer every year contributes a particular amount. The fund


created can be used by the employees for thr purpose of long-term

investment in various things such as a house, etc.

Group Mediclaim Insurance Scheme: This insurance scheme is to provide

adequate insurance coverage of employees for expense related of
hospitalization due to illness, diseases or injury. All employees and their
dependent family members are eligible. Dependent family members
include spouse of male members. Non-earning parents and children
above three months.
Personal Accident Scheme: This scheme is to provide adequate insurance
for hospitlization expenses arising out of injuries sustained in an accident.
It is applicable to all of JFWTC and covers total or partial disablement or
deah due at accident qnd due to accidents.








transportation facility to all the employees from home till office at

subsidized rates. The lunch provided id also subsidized
Company Leased Accomodations: Some of the companies provides
shared accommodations for all the out station employees. In fact some of
the BPO companies undertake to pay electricity/watr bills as well as the
society charges for the shared accommodations.

Recreation, Caf, ATM and Concierge facilities: The recreation facilities

include pool tables and coffee bars. Companies also have well equipped
gyms. Corporte credit cars the main purpose of this facility is enable the
timely and efficient payments of official expaenses such as travel related
expenses hote;l bills , air tickets etc.


Cellular phone/ laptops: cellular phone and laptops are provided to the
employee on the basis of business need. The employee is responsible for
the maintaince and safeguarding of the asset. Personal health care. Some
of the BPOs provided the facility for extensive health check up can be
done once a year.
Loans: many companies provides loan facility on three different occasions.
Employee is provided with financial assistance in cases of a medical
emergence. Employees are also provided with financial assistqance at the
time of their wedding. And, the new recruits are provided with interest free
loans their initial settlement at the work location.
Education Benefits: many BPO companies have the policy to develop the
personality and knowledge level of their employees and hence reimburses
the expenses incurred towards tution fees, examination fees, for the
higher studies.
Performance Based Incentives: In many BPO companies they have plans
for performance based incentives scheme. The parmeters for calculation
are process performance i.e. speed accuracy and productivity of each
Flexi Time:

the main objective of the flexitime policy is to provide

opportunity to work with flexible work schedules and set out conditions for
availing this provision. This facility is initated by employees and approved
by management to meet business commitments while supporting
employee personal life needs. Child care. Parent care, health situation,
maternity, formal education program..


Flexible salary Benefits: its main objective is to provide flexibility to the

employees to plan a tax-effective compensation structure by balancing the
monthly net income, yearly benefits and income tax payble.
Singing, acting, dancing etc. Apart from that the organizations also
conduct various sports programs as cricket, football, etc and regularly play
matches with the teams of other organizations and colleges.
Wedding Day gift: employees are given a gift vouchers of Rs 2000 to Rs
7000 based on their level in the organizations.
Employee Referral Scheme: In several companies employee referral
scheme is implemented to encourage employee to refer friends and
relatives for employment in the organization
Paid Days off
Maternity leave
Employee stock option plan


In general any graduate can join any of the BPO. Some BPOs like to take people
with MBA but then again the specialization are of an individual hardly makes any
differences. Again, this is the industry where there are no reference checks and
very often people dont even specify that exact age. There are some of the
reasons why people join BPOS

Did not get a better job

Find nothing better to do
Education level doesnt matter
Good work environment
Good benefits
Flexibility of time
Attractive life style
Transport facility


When there are so many benefits associated with BPO industry when there are
also so many reasons those BPO employees than what makes them to change
the company industry? It is only money that matters or any thing else as well?
Here are some of the reasons for BPO professionals to change their job. There
are some of the reasons:

No growth opportunity or lack of promotion

For higher salary
For higher education
Misguiding by the company
Policies and procedures are not conductive

No personal life
Physical strains
Uneasy relationship with peers or managers
What they have to say?

With so much of uncertainty in the market people are trying their best to stop or
at least have a control on the attrition rate in this industry.
Career growth in the industry is robust and there is a long term opportunity. The
great growth momentum that the industry is witnessing is creating both vertical
and lateral; career opportunities in the middle management and supervisory level
within the industry- Aadesh Goyal, Executive Vice President and GM , Hughes
BPO services.


"We will be a globally respected corporation."
"We aim to achieve our objectives in an environment of fairness, honesty,
courtesy towards our clients, employees, vendors and society at large."
We believe that the softest pillow is a clear conscience. The values that drive us
underscore our commitment to:
Client Value: To surpass client expectations consistently
Leadership by Example: To set standards in our business and transactions
and be an exemplar for the industry and ourselves
Integrity and Transparency: To be ethical, sincere and open in all our
Fairness: To be objective and transaction-oriented, and thereby earn trust
and respect

Excellence: To strive relentlessly, constantly improve ourselves, our

teams, our services and products to become the best

A Magnet for the Best Global Talent

Fortune magazine identified Infosys among the top companies that "inspire,
nurture and empower a new generation of global leaders." We are committed to
remain among the industry's leading employers.
Quality Focus
'In God we trust, everyone else must come with data' is an oft-heard phrase at
Infosys. We constantly benchmark our services and processes against globally
recognized quality standards. Our certifications include SEI-CMMI Level 5, CMM
Level 5, PCMM Level 5, TL 9000 and ISO 9001-2000. In February 2007, Infosys
BPO was certified for eSCM level 4.0, the eSourcing Capability Model for Service
Providers developed by a consortium led by Carnegie Mellon University's
Information Technology Services Qualification Centre.
Innovation, Speed and Excellence in Execution
We were one of the first companies to develop and deploy a global delivery
model and attain SEI-CMMI Level 5 certification our offshore and onsite
operations. We manage growth by investing in infrastructure and by rapidly
recruiting, training and deploying new professionals. We have 63 global
development centers, the majority of which are located in India. We also have
development centers in Australia, Canada, China, Japan, Mauritius, and at
multiple locations in the United States and Europe.
Industry Leadership
Our history is marked by a series of firsts. We were the first Indian company to
list on a US stock exchange and the first Indian company to do a POWL in
Japan. In December 2006, we became the first Indian company to be added to
the NASDAQ-100 index and became the only Indian company to be part of any
of the major global indices. We were recently listed on The Global Dow. Infosys
was also ranked No. 14 among the most respected companies in the world by
Reputation Institute's Global Pulse 2008. We were also listed on Forbes' Asian
Fabulous 50 for the fourth consecutive year. Infosys is also a five-time Global

MAKE Winner and one of only two Indian companies amongst global leaders to
have won the award in 2008.

Established in 1981, Infosys is a NASDAQ listed global consulting and IT
services company with more than 130,000 employees. From a capital of US$
250, we have grown to become a US$ 6.04 billion (LTM March-11 revenues)
company with a market capitalization of approximately US$ 41 billion.
In our journey of over 29 years, we have catalyzed some of the major changes
that have led to India's emergence as the global destination for software services
talent. We pioneered the Global Delivery Model and became the first IT company
from India to be listed on NASDAQ. Our employee stock options program
created some of India's first salaried millionaires

Infosys selected as a member of The Global Dow
Employee strength grows to over 100,000

Infosys crosses revenues of US$ $ 4.18 billion
Annual net profits cross US$ 1 billion

Infosys crosses revenues of US$ 3 billion. Employees grow to over 70,000+

Kris Gopalakrishnan, COO, takes over as CEO. Nandan M. Nilekani is

appointed Co-Chairman of the Board of Directors
Opens new subsidiary in Latin America
Reports Q2 revenue of over US$ 1billion


Infosys celebrates 25 years. Revenues cross US$ 2 billion. Employees

grow to 50,000+
N. R. Narayana Murthy retires from the services of the company on
turning 60. The Board of Directors appoints him as an Additional Director. He
continues as Chairman and Chief Mentor of Infosys


Records the largest international equity offering of US$ 1 billion from India
Selected to the Global MAKE Hall of Fame


Revenues reach US$ 1 billion

Infosys Consulting Inc. is launched


Establishes subsidiaries in China and Australia

Expands operations in Pune and China, and sets up a development center in


Touches revenues of US$ 500 million

Nandan M. Nilekani takes over as CEO from N.R. Narayana Murthy, who is
appointed Chairman and Chief Mentor
Opens offices in the Netherlands, Singapore and Switzerland
Sponsors secondary ADS offering
Infosys and the Wharton School of the University of Pennsylvania set up The
Wharton Infosys Business Transformation Awards (WIBTA)
Launches Progeon, offering business process outsourcing services


Touch revenues of US$ 400 million. Opens offices in UAE and Argentina,
and a development center in Japan
N. R. Narayana Murthy is rated among Time Magazine/CNN's 25 most
influential businessmen in the world
Infosys is rated as the Best Employer by Business World/Hewitt


Touches revenues of US$ 200 million

Opens offices in France and Hong Kong, a global development center in
Canada and UK, and three development centers in the US
Re-launches Banks 2000, the universal banking solution from Infosys, as

199 touch revenues of US$ 100 million. Listed on NASDAQ

Infosys becomes the 21st company in the world to achieve a CMM Level 5
Opens offices in Germany, Sweden, Belgium, Australia, and two development
centers in the US
Infosys Business Consulting Services is launched


Starts Enterprise Solutions (packaged applications) practice


Opens an office in Toronto, Canada

Infosys is assessed at CMM Level 4

The Infosys Foundation is established


Opens first European office in the UK and global development centers at

Toronto. Sets up e-Business practice


Company moves corporate headquarters to the Electronic City of Bangalore.

Opens a development center at Fremont


Introduces Employee Stock Options (ESOP) program

Acquires ISO 9001/TickIT certification
Goes public


Opens first international office in Boston, US


Relocates corporate headquarters to Bangalore


Infosys is established by N. R. Narayana Murthy and six engineers in Pune,

India, with an initial capital of US$ 250
Signs up its first client, Data Basics Corporation, in New York
Infosys BPO Ltd., 18,000 employees, the Business Process Outsourcing
subsidiary of Infosys Technologies Ltd., (NASDAQ: INFY), was established in
April 2002. Infosys BPO addresses business challenges and unlocks business
value by applying proven process methodologies, integrated IT and business
process outsourcing solutions. The company applies business excellence
frameworks to significantly reduce costs, enhance effectiveness and optimize
business processes. The company focuses on integrated end-to-end outsourcing
and delivery of result-oriented benefits to our clients through reduced costs,

Our business solutions and leadership are recognized by several global forums.
We have earned Level 5, the highest rating for the e-Sourcing Capability Model
(eSCMSP: v2.0) by Carnegie Mellon University's IT Services Qualification
Center (ITSqc). We are the second company in India and third globally to receive
the certification.


Infosys reports Q4 and FY 2011 results*

Fiscal revenues at US$ 6.04 billion
Up 25.8% YoY
18.6% YoY growth in earnings per American Depositary Share

Infosys is India's best company for corporate governance: Asiamoney

Infosys was recognized for best practices in corporate governance by

analysts and senior executives in the Asiamoney Corporate Governance
Poll 2010.

Infosys cited as a leader in global IT infrastructure outsourcing services by

independent research firm

Infosys has an ecosystem driven by innovation and is a leader in IT

infrastructure transformation, according to The Forrester Wave: Global
IT Infrastructure Outsourcing, Q1 2011.

Infosys blends the science of software with the art of consulting: HBR


Infosys innovates its business model continuously for sustainable growth,

according to an article in the Harvard Business Review.

Infosys Prize 2010 honors Indian scientists for nation building

Dr. Manmohan Singh, Prime Minister of India, presented the Infosys Prize
2010 for outstanding scientific research that advances Indias economic
and social development.

Infosys shares vision for sustainable growth

In the Sustainability Report 2009-10, Infosys discusses how a 'sustainable

tomorrow' can be achieved by focusing on social contract, resource efficiency
and green innovation

Infosys is India's most admired company: The Wall Street Journal

On the cusp of the 30th anniversary, Infosys was voted the 'Most Admired
Indian Company' in The Wall Street Journal Asia 200 online poll. The
company has achieved this distinction for nine years in a row.

Infosys ranked second in 'Global Outsourcing 100'

Infosys was recognized for 'demonstrated competencies' in Information
and Communication Technology (ICT) services and Transaction
Processing services in The International Association of Outsourcing
Professionals 2010 survey.
Infosys has consistently been honored by customers, industry bodies,
media and other influencers. The following are among the recognitions we
received over the past year:

Infosys topped a poll on best practices in corporate governance conducted by

Asiamoney. Infosys was ranked among the top 50 most respected companies in
the world by Reputation Institutes Global Reputation Pulse 2009. We have been
voted the 'Most Admired Indian Company' in The Wall Street Journal Asia 200
every year since 2000. We won Sears Holding Corporation's Partners in
Progress award for the second consecutive year. We also won HDS' Diamond

Award for 'Best Virtualization Strategy' and Platinum Award for 'Best Green
Strategy for a Data Center'. Infosys was also listed in the Most Admired
Knowledge Enterprises (MAKE) 2008 study and Forbes' Asian Fabulous 50 for
the fourth consecutive year. We were ranked among the 'Best Companies for
Leaders' in a survey by Bloomberg BusinessWeek and Hay Group in 2009,
'India's Best Companies to Work For - 2009' in a survey by the Great Place to
Work Institute and conferred with the NASSCOM gender inclusivity award.
Asset magazine acclaimed our Corporate Governance, acknowledging our
corporate policies and practices as among the best in the industry.


Employee Retention involves taking measures to encourage employees to
remain in the organization for the maximum period of time. Corporate is facing a
lot of problems in employee retention these days. Hiring knowledgeable people
for the job is essential for an employer. But retention is even more important than
hiring. There is no dearth of opportunities for a talented person. There are many
organizations which are looking for such employees. If a person is not satisfied
by the job hes doing, he may switch over to some other more suitable job. In
todays environment it becomes very important for organizations to retain their
The top organizations are on the top because they value their employees and
they know how to keep them glued to the organization. Employees stay and
leave organization for some reasons. The reasons may be personal and
professional. These reasons should be understood by the employer and should
be taken care of. The organizations are becoming aware of these reasons and
adopting many strategies for retention. In this section we are going to study
about various topics related to employee retention, why it is needed, basic
practices, myths, etc. in detail.


Thus, Employee turnover is one of the largest though widely unknown costs an
Organization faces. While companies routinely keep track of various costs such
as supplies and payroll, few take into consideration how much employee turnover
will cost them: Ernst & Young estimates it costs approximately $120,000 to
replace 10 professionals. According to research done by Sibson & Company, to
recoup the cost of losing just one employee a fast food restaurant must sell 7,613
combo meals at $2.50 each. Employee turnover costs companies 30 to 50% of
the annual salary of entry-level employees, 150% of middle-level employees, and
up to 400% for upper level, specialized employees. Now that so much is being
done by organizations to retain its employees.
Why is retention so important? Is it just to reduce the turn over costs?
Well, the answer is a definite no. Its not only the cost incurred by a company that
emphasizes the need of retaining employees but also the need to retain talented
employees from getting poached

Employee Retention Strategies

The basic practices which should be kept in mind in the employee retention
strategies are:
1. Hire the right people in the first place.
2. Empower the employees: Give the employees the authority to get things done.
3. Make employees realize that they are the most valuable asset of the
4. Have faith in them, trust and respect them
5. Provide them information and knowledge.

6. Keep providing them feedback on their performance.

7. Recognize and appreciate their achievements.
8. Keep their morale high.

Guiding Model of Employee Retention

Job embedded ness theory argues that the organization and the community to
which the employee belong generate 3 sets of forces that combine to make it
more likely that they will stay on in their job:
The extent to which people have links to other people, institutions or activities;
The extent to which their job and community are similar to, or fit with the other
aspects in their life space and;
The ease with which links can be broken individual perceptions about cost or
sacrifice if they leave their job or community.


Guiding Model of Employee Retention

Retention involves five major things:


Compensation constitutes the largest part of the employee retention process.
The employees always have high expectations regarding their compensation
Compensation packages vary from industry to industry. So an attractive
Compensation package plays a critical role in retaining the employees.

Compensation includes salary and wages, bonuses, benefits, prerequisites,

stock options, bonuses, vacations, etc. While setting up the packages, the
following components should be kept in mind:
Salary and monthly wage: It is the biggest component of the
compensation package. It is also the most common factor of comparison

among employees. It includes

Basic wage
House rent allowance
Dearness allowance
City compensatory allowance

Salary and wages represent the level of skill and experience an individual has.
Time to time increase in the salaries and wages of employees should be done.
And this increase should be based on the employees performance and his
contribution to the organization. Bonus: Bonuses are usually given to the
employees at the end of the year or on a festival. Economic benefits: It includes
paid holidays, leave travel concession, etc. Long-term incentives: Long term
incentives include stock options or stock grants. These incentives help retain
employees in the organization's start up stage.
Health insurance: Health insurance is a great benefit to the employees. It saves
employees money as well as gives them a peace of mind that they have
somebody to take care of them in bad times. It also shows the employee that the
organization cares about the employee and its family.

After retirement: It includes payments that an Employee gets after he

retires like EPF (Employee Provident Fund) etc.
Miscellaneous compensation: It may include employee assistance
programs (like psychological counseling, legal assistance etc), discounts on
company products, use of a company cars, etc.


Employers And Their Key Drivers To Attract And Retain Talent

Employers Key Drives To Attract And Retain Talent

Procter and Gamble India

Early responsibilities in career
Flexible and transparent organizational culture
Global opportunities through a variety of exposure and diverse

Performance Recognition

American Express (India)

Strong global brand
Value-based environment
Pioneer in many people practices

Learning and growth opportunities
Competitive rewards
Opportunity to grow, learn and implement
Strong social security and employee welfare performance- oriented

Johnson & Johnson

Strong values of trust, caring fairness, and respect within the organization
Freedom to operate at work
Early responsibility in career
Training and learning opportunities
Visible, transparent and accessible leaders
Competitive rewards
Innovative HR programs and practices

Glaxo Smith Kline Consumer Healthcare

Performance-driven Rewards
Its belief in Growing our own timber
Comprehensive development and learning programs
Flat organization, where performance could lead to very quick progression
Challenging work context
Competitive rewards
Exhaustive induction and orientation program

Tata Steel

Organization philosophy and culture

Job stability
Freedom to work and innovate

Colgate Palmolive India

Company brand
Open , transparent, and caring organization
Management according to the managing with respect to guiding principles
Training ad development programs
Structured career planning process
Global career opportunities

Companys brand as an employer
Early opportunities for growth
High degree of autonomy
Value compatibility
Innovative people program

Indian Oil Corporation

Company brand image
Work ethics
Learning and growth opportunities
Challenging work assignments
Growing organization

The group brand equity
Strong corporate governance and citizenship
Commitment to learning and development
Best in people practices
Challenging assignments
Opportunity to work with fortune 500 clients

Organization Environment
It is not about managing retention. It is about managing people. If an
organization manages people well, employee retention will take care of
itself. Organizations should focus on managing the work environment to
make better use of the available human assets. People want to work for
an organization which provides

Appreciation for the work done

Ample opportunities to grow

A friendly and cooperative environment

A feeling that the organization is second home to the employee

Organization environment includes

Company reputation
Quality of people in the organization
Employee development and career growth
Risk taking
Leading technologies

Types of environment the employee needs in an organization

Learning environment: It includes continuous learning and improvement

of the individual, certifications and provision for higher studies, etc.

Support environment: Organization can provide support in the form of

work-life balance. Work life balance includes:

1. Flexible hours
2. Telecommuting
3. Dependent care
3. Alternate work schedules
4. Vacations
6. Wellness
Work environment: It includes efficient managers, supportive co-workers,
challenging work, involvement in decision-making, clarity of work and
responsibilities, and recognition. Lack or absence of such environment
pushes employees to look for new opportunities. The environment should
be such that the employee feels connected to the organization in every
Growth and Career Growth and development are the integral part of every
individuals career. If an employee can not foresee his path of career
development in his current organization, there are chances that hell leave
the organization as soon as he gets an opportunity. The important factors
in employee growth that an employee looks

for himself are:

Work profile: The work profile on which the employee is working


should be in sync with his capabilities. The profile should not be too low or too

Personal growth and dreams: Employees responsibilities in the






his personal

goals also.

Organizations can not keep aside the individual goals of employees and
foster organizations goals. Employees priority is to work for themselves
and later on comes the organization. If hes not satisfied with his growth,

hell not be able to contribute in organization growth.

Training and development: Employees should be trained and given
chance to improve and enhance their skills. Many employers fear that if
the employees are well rained, theyll leave the organization for better
jobs. Organization should not limit the resources on which organizations
success depends. These trainings can be given to improve many skills

1. Communications skills
2. Technical skills
3. In-house processes and procedures improvement related skills or
customer satisfaction related skills
4. Special project related skills
Need for trainings are recognized from individual performance reviews, individual
meetings, employee satisfaction surveys and by being in constant touch with the
Importance of Relationship in Employee Retention Program
Sometimes the relationship with the management and the peers becomes the
reason for an employee to leave the organization. The management is
sometimes not able to provide an employee a supportive work culture and
environment in terms of personal or professional relationships. There are times
when an employee starts feeling bitterness towards the management or peers.
This bitterness could be due to many reasons. This decreases employees
interest and he becomes demotivated. It leads to less satisfaction and eventually
attrition. A supportive work culture helps grow employee professionally and
boosts employee satisfaction. To enhance good professional relationships at
work, the management should keep the following points in mind.

Respect for the individual: Respect for the individual is the must in the

Relationship with the immediate manager: A manger plays the role of a

mentor and a coach. He designs and plans work for each employee. It is
his duty to involve the employee in the processes of the organization. So
an organization should hire managers who can make and maintain good

relations with their subordinates.

Relationship with colleagues: Promote team work, not only among
teams but in different departments as well. This will induce competition as

well as improve the Relationship among colleagues.

Recruit whole heartedly: An employee should be recruited if there is a
proper place and duties for him to perform. Otherwise hell feel useless
and will be dissatisfied.

Employees should know what the organization expects from them and what their
expectation from the organization is. Deliver what is promised. Promote an
employee based culture: The employee should know that the organization is
there to support him at the time of need. Show them that the organization cares
and hell show the same for the organization. An employee based culture may
include decision making authority, availability of resources, open door policy, etc.

Individual development: Taking proper care of employees includes

acknowledgement to the employees dreams and personal goals. Create
opportunities for their career growth by providing mentorship programs,

certifications, educational courses, etc.

Induce loyalty: Organizations should be loyal as well as they should
promote loyalty in the employees too. Try to make the current employees
stay instead of recruiting new ones.

Support Lack of support from management can sometimes serve as a reason for
employee retention. Supervisor should support his subordinates in a way so that
each one of them is a success. Management should try to focus on its
employees and support them not only in their difficult times at work but also
through the times of personal crisis. Management can support employees by


providing them recognition and appreciation. Employers can also provide

valuable feedback to employees and make them feel valued to the organization.
The feedback from supervisor helps the employee to feel more responsible,
confident and empowered. Top management can also support its employees in
their personal crisis by providing personal loans during emergencies, childcare
services, employee assistance Programs, counseling services, etc
Employers can also support their employees by creating an environment of trust
and inculcating the organizational values into employees. Thus employers can
support their employees in a number of ways as follows:

By providing feedback
By giving recognition and rewards
By counselling them
By providing emotional support

How to increase Employee Retention?

Companies have now realized the importance of retaining their quality workforce.
Retaining quality performers contributes to productivity of the organization and
increase morale among employees. Four basic factors that
play an important role in increasing employee retention

include salary and

remuneration, providing recognition, benefits and opportunities for individual

growth. But are they really positively contributing to the retention rates of a
company? Basic salary, these days, hardly reduces turnover. Today employees
look beyond the money factor.
Employee retention can be increase by inculcating the following practices:
1. Open Communication: A culture of open communication enforces loyalty
among employees. Open communication tends to keep employees

informed on key issues. Most importantly, they need to know that their
opinions matter and that management is 100% interested in their input.
2. Employee Reward Program: A positive recognition for work boosts the
motivational levels of employees. Recognition can be made explicit by
providing awards like best employee of the month or punctuality award.
3. Career Development Program: Every individual is worried about his/her
career. He is always keen to know his career path in the company.
Organization can offer various technical certification courses which will
help employee in enhancing his knowledge.
4. Performance Based Bonus: A provision of performance linked bonus can
be made wherein an employee is able to relate his performance with the
company profits and hence will work hard. This bonus should strictly
productivity based.
5. Recreation facilities: Recreational facilities help in keeping employees
away from stress factors. Various recreational programs should be
arranged. They may include taking employees to trips annually or biannually, celebrating anniversaries, sports activities, etc.

How to measure Employee Retention?

Gallup research consistently confirms that engaged work places compared with
least engaged are much more likely to have lower employee turnover, higher
than average customer loyalty, above average productivity and earnings.
These are all good things that prove that engaging and involving employees
make good business sense and building shareholder value. Negative workplace
relationships may be a big part of why so many employees are not engaged with
their jobs.
Step 1: listen
The employer must listen to his employees and remember that this is a
continuous process. The information employers supply will provide direction.

This is the only way to identify their specific concerns. When leaders listen,
employees respond by becoming more engaged. This results in increased
productivity and employee retention. Engaged employees are much more likely
to be satisfied in their positions, remain with the company, be promoted, and
strive for higher levels of performance.
Step 2. Measure current level of Employee Retention
Employee Retention needs to be measured at regular intervals in order to track
its contribution to the success of the organization. But measuring the
engagement (feedback through surveys) without planning how to handle the
result can lead employees to disengage
It is important that Employee Retention is not viewed as a one time action.
Employee Retention should be a continuous process of measuring, analyzing,
defining and implementing.
The employee survey is a diagnostic tool of choice in the battle for the heart of
employees. Studies of Gallup, Mercer, Hewitt and Watson Wyatt asked workers
numbers of questions relating to their job satisfaction. Gallup being one of the
oldest the consulting organization creates a feedback system for employers that
would identify and measure elements of worker engagement most tide to the
bottom line. Things such as sales, growth, productivity and customer loyalty are
all accessed
Step 3: Identify the problem areas
Identify the problem areas to see which the exact areas are.
Step 4. Taking action to improve Employee Retention by acting upon the problem
Nothing is more discouraging to employees than to be asked for their feedback
and see no movement toward resolution of their issues.

Even the smallest

actions taken to address concerns will let the staff know how their input is valued.
Feeling valued will boost morale, motivate and encourage future inputs. Taking


action starts with listening to employee feedback and a definitive action plan will
need to be put in place finally.

Case study: Employee Retention in action: Sun Microsystems

Employee Retention becomes that much more official in such a virtual or global
Employee Retention is imperative for an organization like Sun as they operate in
virtual teams across the world.
At Sun the virtual is partly due to flexible working practices. While flexible working
arrangements are a plus for many employees and reduces facility costs for the
organization, that flexibility comes with some downsides like: isolation, loneliness
and an increase in personal distractions.


Isolation, especially when paired with the demands of work in an increasingly

competitive environment, can wear down the sense of connection, commitment
and excitement about any job. Thus a critical challenge for managers of virtual
teams is how to keep remote employees engaged.
At Sun, the concept of Employees Retention starts right from the top:
o Scott McNealy, the CEO, interacts with Sun employees through WSUN, a
forum in Suns Intranet. He uses this to sustain an active an ongoing
dialogue on the corporate goals and direction. Through this interactive online resource he also solicits their feedback and opinions.
o Other senior management members like Jonathan Schwartz, the COO ,
engages with employee on technology directions through this personal
o Business Unit Heads and Executive Vice presidents have a target of
holding six town halls with employees every year this globe
o At the country level, the senior management is tasked with constantly
engaging employees through various forums, communication media and
events to build excitement and passion including some that also reach out
to the employees families.

Employees Retention Activities

1. picnic at regular intervals
2. movie at interval of 2 months
3. a daily column, written by CEO, on the intranet with company
announcements/programs etc.
4. update via an overhead paging system, which is used to recognize
employees for significant business achievements.
5. employee suggestion schemes/quick response
6. CEO spending time in face to face communication with staff
7. CEO based FAQ questions on company business

8. monthly staff awards

9. problem solving committee
10. Indoor games as well as outdoor games like chess, cricket, badminton
11. conducting soft skill training program as well as required training
12. celebration of employees birthday
13. provide long term strategic vision for business growth
14. appointment of disaster management team
15. appointment of emergency management team
16. weekly blog related to serious business issues and staff to read/






Retention Management:
Background: Retention Management is a highly topical subject and an
Important dilemma many organizations might face in the future, if not facing it
already. We believe that the leader plays a key role in employee retention and
retention management. The concept of retention management can both have a
narrow, and a broader significance. Both parts of its significance are generally
included in this thesis. The background of the thesis presents a few articles that
discuss issues that makes it important for the organization, and the leaders, to

work hard with retention management. The research is based on the leaders in
the Finnish case company Tradeka. Following key questions are intended to be
answered: What are the consequences between leaders actions and employees
retention? Which is the leaders role when it comes to retaining employees?
Purpose statement: The purpose of the thesis is to investigate and analyze how
company leaders today can retain their key employees. How can the provision of
key human resources develop a long-term relationship that makes top
employees stay in the company? The study aims to establish the procedure
leaders apply to retain employees. The purpose is to compare the qualitative
study, made at the case company, with findings from the thesis theoretical
Research method: The study is a qualitative, as well as a theoretical study
where empirical findings and theories has been compared. The intention of
investigating and using the Finnish company Tradeka Limited as a case
company, is to make the information from the theories more valid, and also the
interest in how retention management works in practice. Eleven qualitative
interviews were conducted at Tradeka?
Financial department, both with supervisors and employees to get a broader view
at the phenomenon retention management. Result: Leaders and their skill in
creating a culture of retention, has becoming a key in why people stay and what
usually drives them away from a company. The leader has become the main
factor in what motivates peoples decision to stay or leave. For organizations to
keep its key employees their number one priority should be to look at their








Characteristics in a leader that are of importance, as the leader plays a key role
in retention management is: trust builder, esteem builder, communicator, talent
developer and coach, and talent finder. The leaders relation to the employees
plays a central role in retaining employees.


Employee Retention Strategies

The basic practices which should be kept in mind in the employee retention
strategies are:
1. Hire the right people in the first place.
2. Empower the employees: Give the employees the authority to get things done.
3. Make employees realize that they are the most valuable asset of the
4. Have faith in them, trust and respect them
5. Provide them information and knowledge.
6. Keep providing them feedback on their performance.
7. Recognize and appreciate their achievements.
8. Keep their morale high.
9. Create an environment where the employees want to work and have fun.

These practices can be categorized in 3 levels:

medium and
high level.

Low Level Employee Retention Strategies:

Appreciating and recognizing a well done job

Personalized well done and thank-you cards from supervisors
Congratulations e-cards or cards sent to spouses/families
Voicemails or messages from top management
Periodic days off for good performance
Rewards ( gift, certificates, monetary and non monetary rewards)
Recognizing professional as well as personal significant events
Wedding gifts
Anniversary gifts
New born baby gifts
Scholarships for employees children
Get well cards/flowers

Birthday cards, celebrations and gifts

Providing benefits
Home insurance plans
Legal insurance
Travel insurance
Disability programs
Providing perks: It includes coupons, discounts, rebates, etc
Discounts in cinema halls, museums, restaurants, etc.
Retail store discounts
Computer peripherals purchase discounts
Providing workplace conveniences
On-site ATM
On-site facilities for which cost is paid by employees
laundry facility for bachelors
Shipping services
Assistance with tax calculations and submission of forms
Financial planning assistance
Casual dress policies
Facilities for expectant mothers
Parenting guide
Lactation rooms
Flexi timings
Fun at work
Celebrate birthdays, anniversaries, retirements, promotions, etc
Holiday parties and holiday gift certificates
Occasional parties like diwali, holi, dusshera, etc
Organize get together for watching football, hockey, cricket matches
Organize picnics and trips for movies etc
Sports outings like cricket match etc
Indoor games
Occasional stress relievers
Casual dress day
Green is the color day
Handwriting analysis
Tatoo, mehandi, hair braiding stalls on weekends
Mini cricket in office
Ice cream Fridays
Holi-Day breakfast
Employee support in tough time or personal crisis
Personal loans for emergencies
Childcare and eldercare services
Employee Assistance Programs ( Counselling sessions etc)

Medium Level Strategies for Employee Retention

Appreciating and recognizing a well done job
Special bonus for successfully completing firm-sponsored certifications
Benefit programs for family support
Child adoption benefits
Flexible benefits
Dependents care assistance
Medical care reimbursement
Providing conveniences at workplace
Athletic membership program
Providing training and development and personal growth opportunities
Sabbatical programs
Professional skills development
Individualized career guidance

High Level Strategies

Promoting Work/Life Effectiveness
Develop flexible schedules
Part-time schedules
Extended leaves of absence
Develop Support Services
On-site day care facility etc.

Understand employee needs: This can be done through proper

management style and culture

Listen to the employee and show interest in ideas
Appreciate new ideas and reward risk-taking
Show support for individual initiative
Encourage creativity

Encouraging professional training and development and/or personal

growth opportunities: It can be done through:

Mentoring programs
Performance feedback programs
Provide necessary tools to the employees to achieve their professional

and personal goals

Getting the most out of employee interests and talents
Higher study opportunities for employees
Vocational counselling
Offer personalized career guidance to employees

Provide an environment of trust: Communication is the most important

and effective way to develop trust.

Suggestion committees can be created
Open door communication policy can be followed

Regular feedbacks on organizations goals and activities should be

taken from the employees by:

Management communications
Intranet and internet can be used as they provide 24X7 access to the
information Newsletters, notice boards, etc.

Hire the right people from the beginning: employee retention is not a
process that begins at the end. The process of retention begins right from
the start of the recruitment process.

The new joinees should fit with the organizations culture. The personality,
leadership characteristics of the candidate should be in sync with the culture of
the hiring organization.
Referral bonus should be given to the employees for successful hires. They are
the best source of networking. Proper training should be given to the managers
on interview and management techniques. An internship program can be
followed to recruit the fresh graduates.
Retention Success Mantra

Transparent Work Culture

In todays fast paced business environments where employees are constantly

Striving to achieve business goals under time restrictions; open minded and
Transparent work culture plays a vital role in employee retention. Companies
invest very many hours and monies in training and educating employees. These
companies are severely affected when employees check out, especially in the
middle of some big company project or venture. Although employees most often

prefer to stay with the same company and use their time and experience for
personal growth and development, they leave mainly because of work related
stress and dissatisfactions .More and more companies have now realized the
importance of a healthy work culture and have a gamut of people management
good practices for employees to have that ideal fresh work-life. Closed doors
work culture can serve as a deterrent to communication and trust within
employees which are potential causes for work- Related apathy and frenzy.
A transparent work environment can serve as one of the primary triggers to
Facilitate accountability, trust, communication, responsibility, pride and so on. It is
believed that in a transparent work culture employees rigorously communicate
with their peers and exchange ideas and thoughts before they are finally matured
in to full-blown concepts. It induces responsibility among employees and
accountability towards other peers, which gradually builds up trust and pride.

Quality Of Work
The success of any organization depends on how it attracts, recruits, motivates,
and retains its workforce. Organizations need to be more flexible so that they
develop their talented workforce and gain their commitment. Thus, organizations
are required to retain employees by addressing their work life issues. The
elements that are relevant to an individuals quality of work life include the task,
the physical work environment, social environment within the organization,
administrative system and relationship between life on and off the job. The basic
objectives of a QWL program are improved working conditions for the Employee
and increase organizational effectiveness.
Providing quality work life involves taking care of the following aspects:


Occupational health care: The safe work environment provides the basis for the
person to enjoy working. The work should not pose a health hazard for the
person. The employer and employee, aware of their risks and rights, could
achieve a lot in their mutually beneficial dialogue.
Suitable working time: Organizations are offering flexible work options to their
employees wherein employees enjoy flexi-timings for dedicating their efforts at
Appropriate salary: The appropriate as well as attractive salary has always
been an important factor in retaining employees. Providing employees salary at
par with the other counterparts of above that what competitors are paying
motivates them to stick with the company for long. QWL consists of opportunities
for active involvement in group working arrangements or problem solving that are
of mutual benefit to employees or employers, based on labor management
People also conceive of QWL as a set of methods, such as autonomous work
groups, job enrichment, and high-involvement aimed at boosting the satisfaction
and productivity of workers. It requires employee commitment to the organization
and an environment in which this commitment can flourish. Providing quality at
work not only reduces attrition but also helps in reduced absenteeism and
improved job satisfaction. Not only does QWL contribute to a company's ability to
recruit quality people, but also it enhances a company's competitiveness.
Common beliefs support the contention that QWL will positively nurture a more
flexible, loyal, and motivated workforce, which are essential in determining the
company's competitiveness. Supporting Employees Organizations these days
want to protect their biggest and most valuable asset and they want to do this in
a way that best suits their organizational culture. Retaining employees is a
difficult task. Providing support to the employees acts as a mantra for retraining


them. Employers can also support their employees by creating an environment of

trust and inculcating the organizational values into employees.
The management can support employees directly or indirectly. Directly, they
provide support in terms of personal crises, managing stress and personal
development. Management can support employees, indirectly, in a number of
ways as follows:
Manage employee turnover: Employee turnover affects the whole organization
in terms of productivity. Managing the turnover, hence, becomes an important
task. A proactive approach can be adopted to reduce attrition. Strategies should
be framed in advance and implemented when the times arrives. Turnover costs
should also be taken into consideration while framing these strategies.
Become employer of choice: What makes a company an employer of choice?
Is the benefit it offers or the compensation packages it gives away to its
employees? Or is it measured in terms of how they value their employees or in
terms of customer satisfaction? Becoming an employer of choice involves
following a road map which tells where to go as a brand.
Engage the new recruits: The newly hired employees are said to be least
engaged in the organization. Keeping them engaged is an important task. The
fresh talent should be utilized to maximum before they start feeling bored in the
Optimize employee engagement: An organizations productivity is measured
not in terms of employee satisfaction but by employee engagement. Employees
are said to be engaged when they show a positive attitude toward the
organization and express a commitment to remain with the organization.









organizations should aim to maximize the engagement among employees.


Coaching and mentoring: Employees whose work performance suffers due to

poor interpersonal relationships or because of lack of interpersonal skills should
be provided proper coaching by their superiors. Planed coaching sessions help
an individual to work through issues, maximize his potential and return to peak


Feedback acts as a channel of communication between the employee and his
manager. The amount of information employees receive about how well or how
poorly they have performed is what we call feedback. It is a dialog between a
manager and an employee which acts as a way of sharing information about the
performance. It suggests where the employee performance is effective and
where performance has to improve. Managers can provide either positive
feedback or negative feedback to employees. This feedback helps the employee
assess his performance and identify the improvement areas. Positive feedback







performance boosts up morale of employees and results in performance

improvement to a higher productivity level. It is believed that positive feedback is
the only type of feedback that generates performance above the minimum
acceptable level. Negative feedback obviously communicates managers
dissatisfaction. However, negative feedback sometimes make employee to put
more efforts to improve his performance. But such times are very rare. Moreover
this improvement is short term. Some managers do not provide any kind of
feedback to their employees. Due to no feedback, employees may assume that
they are performing productively or they may feel that the manager is satisfied
with their performance. Studies reveal the performance tends be same or even
decreases if no feedback is provided. Thus, feedback is necessary because:

It builds trust and enhances communication between manager and

It gives managers and employees a way to identify and discuss skills and

Positive feedback leads to employee retention and Retention.

It helps in identifying performance areas that need improvement and

specific ways to improve them. It acts as an opportunity to enhance

performance by identifying resources for skill development. It is an

opportunity for managers and employees to assess and identify career
and advancement opportunities. It helps employees to understand the
effectiveness of their performance and contributes to their overall
knowledge about the work Managers have tendency to ignore good
performances of their employees. Providing no feedback may demotivate
employees and may lead to employee absenteeism. Input from managers
side is necessary as it help employees to improve their performance and
increase productivity.

Communication Between Employee and Employer

Communication is a process in which a message is conveyed to the receiver by

the sender. The message may be or may not be in a common format or language
that both the sender and receiver understand. So there is a need to encode and
decode the message in the process. Encoding and decoding also helps in the
security of the message. The process of communication is incomplete without the
feedback. Communication is the solution to almost everything in this world. Same
applies to employee retention also.
Straight-from-the-shoulder communication is what the employees need from their
employers. Employees look for organizations where communication and process
are transparent. Nothing is hidden and shared with the employees.
There are 3 categories of employees:
A: Who will leave their current employer in 3 years of their employment?
B: Who have a probability of leaving their current employer in next 3 years?
C: Who will stay with their current employer in the next 3 years?
Category A: These are the employees who lack communication with their


Category C: These are the employees who have proper, well structured
communication with their employers. Communication is also the way to win the
employees trust in the organization. Employees trust the employers who are
friendly and open to them. This trust leads to employee loyalty and finally

Employers also feel that the immediate supervisors are the most authenticated
and trusted source of information for them. So the organizations should hire
managers who are active communicators.
Communication Mediums
Open door policy: Organizations should support open door policies so that the
employees feel comfortable and are able to express their doubts and feeling to
their employers. So there should be effective communication across the
organization and this communication should be two-way. Communication alone
can lead to unimaginable heights of employee retention.


Importance of Employee Retention

The process of employee retention will benefit an organization in the following
1. The Cost of Turnover: The cost of employee turnover adds hundreds of
thousands of money to a company's expenses. While it is difficult to fully
calculate the cost of turnover (including hiring costs, training costs and
productivity loss), industry experts often quote 25% of the average employee
salary as a conservative estimate.
Loss of Company Knowledge: When an employee leaves, he takes with him
valuable knowledge about the company, customers, current projects and past
history (sometimes to competitors). Often much time and money has been spent
on the employee in expectation of a future return. When the employee leaves,
the investment is not realized.

Interruption of Customer Service: Customers and clients do business with a

company in part because of the people. Relationships are developed that
encourage continued sponsorship of the business. When an employee leaves,
the relationships that employee built for the company are severed, which could
lead to potential customer loss.


Turnover leads to more turnovers: When an employee terminates, the effect is

felt throughout the organization. Co-workers are often required to pick up the
slack. The unspoken negativity often intensifies for the remaining staff. Goodwill
of the company: The goodwill of a company is maintained when the attrition rates
are low. Higher retention rates motivate potential employees to join the
Regaining efficiency: If an employee resigns, then good amount of time is lost
in hiring a new employee and then training him/her and this goes to the loss of
the company directly which many a times goes unnoticed. And even after this
you cannot assure us of the same efficiency from the new employee. What
Makes Employee Leave? Employees do not leave an organization without any
significant reason. There are certain circumstances that lead to their leaving the
organization. The most common reasons can be:
Job is not what the employee expected to be: Sometimes the job
responsibilities dont come out to be same as expected by the candidates.
Unexpected job responsibilities lead to job dissatisfaction.
Job and person mismatch: A candidate may be fit to do a certain type of job
which matches his personality. If he is given a job which mismatches his
personality, then he wont be able to perform it well and will try to find out reasons
to leave the job.
No growth opportunities: No or less learning and growth opportunities in the
current job will make candidates job and career stagnant.
Lack of appreciation: If the work is not appreciated by the supervisor, the
employee feels de-motivated and loses interest in job.


Lack of trust and support in co workers, seniors and management: Trust is

the most important factor that is required for an individual to stay in the job. Nonsupportive co workers, seniors and management can make office environment
unfriendly and difficult to work in.
Stress from overwork and work life imbalance: Job stress can lead to work
life imbalance which ultimately many times lead to employee leaving the
Compensation: Better compensation packages being offered by other
companies may attract employees towards themselves.
New job offer: An attractive job offer which an employee thinks is good for him
with respect to job responsibility, compensation, growth and learning etc. can
lead an employee to leave the organization.

Managing Employee Retention:

The task of managing employees can be understood as a three stage process:
1. Identify cost of employee turnover.
2. Understand why employee leave.
3. Implement retention strategies
The organizations should start with identifying the employee turnover rates within
a particular time period and benchmark it with the competitor organizations. This
will help in assessing the whether the employee retention rates are healthy in the
company. Secondly, the cost of employee turnover can be calculated. This
amounts to major organizational and financial stress, considering that one out of
every three employees plans to leave his or her job in the next two years.
Understand why employees leave:


Why employees leave often puzzles top management. Exit interviews are an
ideal way of recording and analyzing the factors that have led employees to
leave the organization. They allow an organization to understand the reasons for
leaving and underlying issues. However employees never provide appropriate
response to the asked questions. So an impartial person should be appointed
with whom the employees feel comfortable in expressing their opinions.

Implement retention strategy:

Once the causes of attrition are found, a strategy is to be implemented so as to
reduce employee turnover. The most effective strategy is to adopt a holistic
approach to dealing with attrition.
An effective retention strategy will seek to ensure:
Attraction and recruitment strategies enable selection of the right candidate for
each role/organization New employees initial experiences of the organization are
positive Appropriate development opportunities are available to employees, and
that they are kept aware of their likely career path with the organization
The organizations reward strategy reflects the employee drivers
How To Increase Employee Retention Companies have now realized the
importance of retaining their quality workforce. Retaining quality performers
contributes to productivity of the organization and increases morale among
employees/ Four basic factors that play an important role in increasing employee
retention include salary and remuneration, providing recognition, benefits and
opportunities for individual growth. But are they really positively contributing to
the retention rates of a company? Basic salary, these days, hardly reduces
turnover. Today, employees look beyond the money factor.
Retention Bonus


Higher attrition rates within a particular industry have forced companies to use
some innovative strategies to retain employees. Retention Bonus is one of the
important tools that are being used to retain employees. Retention bonus is an
incentive paid to an employee to retain them through a critical business cycle.
Retention bonuses are becoming more common in the corporate world because
companies are going through more transitions like mergers and acquisitions.
They need to give key people an attractive incentive to stay on through these
transitions to ensure productivity. Retention bonuses have proven to be a useful
tool in persuading employees to stay. A retention bonus plan is not a panacea.
According to a survey, non management employees generally receive about 10
percent of their annual salaries in bonuses, while management and top-level
supervisors earn an additional 50 percent of their annual salaries. While bonuses
based on salary percentages are the generally used, some companies choose to
pay a flat figure. Employees are chosen for retention bonuses based on their
contributions to management and the generation of revenue. Retention bonuses
are generally vary from position to position and are paid in one lump sum at the
time of termination. However, some companies pay in installments as on when
the business cycle completes. A retention period can run somewhere between six
months to three years. It can also run for a particular project. A project
has its own life span. As long as the project gets completed, the employees who
have worked hard on it are entitled to receive the retention bonus. For example,
the implementation of a system may take 18 months, so a retention bonus will be
offered after 20 months. Although retention bonuses are becoming more
common everywhere, some industries are more likely than others to offer them.
Retail/wholesale companies are the most appropriate to implement stay-pay
bonuses, followed by financial service providers and manufacturing firms.

Hire Right Talent


Employee retention starts with recruitment. Early departures arise from the wrong
recruitment process. Here are a few ways to ensure how to hire the right talent
for a particular job. Hire appropriate candidates. Hire candidates who are
actually suitable for the job. For this the employer should understand the job
requirements clearly. Dont hire under qualified or clearly overqualified
Provide realistic job preview at the time of hiring: Mostly employees leave an
organization because they are given the real picture of their job responsibilities at
the time of joining. Attrition rate can be reduced if a right person is hired for a
right job. Realistic preview of the job responsibilities can be given to the
employment seekers by various methods like discussions, trial periods,
internships etc.
Clearly discuss what is expected from the employee: Before joining the
Organization, tell the candidate what is expected from him. Setting wrong
expectations or hiding expectations will result in early leaving of employees.
Discuss what the expectations of the employees are: Ask employees what
they expect from the organization. Be realistic. If their requirements can be
fulfilled only then promise them. Or tell them beforehand that their requirements
cannot be fulfilled.
Dont show them an unrealistic picture Culture fit: Try to judge individuals
capability to adapt to the organizations culture. A drastic change in the culture
may give a culture shock to the candidate.
Referrals: According to the research, referred candidates stay longer with the
organization. There is a fear of hampering the image and reputation of the
person who referred the candidate.


Manager Role in Retention

When asked about why employees leave, low salary comes out to be a common
excuse. However, research has shown that people join companies, but leave
because of what their managers do or dont do. It is seen that managers who
respect and value employees competency, pay attention to their aspirations,
assure challenging work, value the quality of work life and provided chances for
learning have loyal and engaged employees. Therefore, managers and team
leaders play an active and vital role in employee retention.
Managers and team leaders can reduce the attrition levels considerably by
creating a motivating team culture and improving the relationships with team
members. This can be done in a following way:
Creating a Motivating Environment: Team leaders who create motivating
Environments are likely to keep their team members together for a longer period
of time. Retention does not necessarily have to come through fun events such as
parties, celebrations, team outings etc. They can also come through serious
events. e.g. arranging a talk by the VP of Quality on career opportunities in the
field of quality. Employees who look forward to these events and are likely to
remain more engaged.
Standing up for the Team: Team leaders are closest to their team members.
While they need to ensure smooth functioning of their teams by implementing
management decisions, they also need to educate their managers about the
realities on the ground. When agents see the team leader standing up for them,
they will have one more reason to stay in the team.


Providing coaching
Everyone wants to be successful in his or her current job. However, not everyone
knows how. Therefore, one of the key responsibilities will be providing coaching
that is intended to improve the performance of employees. Managers often tend
to escape this role by just coaching their employees. However, coaching is
followed by monitoring performance and providing feedback on the same.
Delegation: Many team leaders and managers feel that they are the only people
who can do a particular task or job. Therefore, they do not delegate their jobs as
much as they should. Delegation is a great way to develop competencies.
Extra Responsibility: Giving extra responsibility to employees is another way to
get them engaged with the company. However, just giving the extra responsibility
does not help. The manager must spend good time teaching the employees of
how to manage responsibilities given to them so that they dont feel over
Focus on future career: Employees are always concerned about their future
career. A manager should focus on showing employees his career ladder. If an
employee sees that his current job offers a path towards their future career
aspirations, then they are likely to stay longer in the company. Therefore,
managers should play the role of career counsellors as well.

How to Improve Employee Retention?

People want to enjoy their work so make work fun and enjoyable.

Understand that employees need to balance life and work so offer flexible
starting times and core hours. Provide 360 feedback surveys and other
questionnaires to foster open communication. Consider allowing anonymous
surveys occasionally so employees will be more honest and candid with their
opinions. Provide opportunities within the company for career progression and
cross-training. Offer attractive, competitive benefits .
Organizations should target job applications for employees who have
characteristics that fit well with the organizational culture. Upon conducting an
interview, seek out traits, such as loyalty. Also, ask the potential employee what
motivates them on the job. Having more information about the potential
employees expectations can help retain them, should they get hired into the
Rewards and Recognition
Employees want to be recognized for a job well done. Rewards and recognition
respond to this need by validating performance and motivating employees toward
continuous improvement. Rewarding and recognizing people for performance not
only affect the person being recognized, but others in the organization as well.
Through a rewards program, the entire organization can experience the
commitment to excellence. When the reward system is credible, rewards are
meaningful; however, if the reward system is broken, the opposite effect will
occur. Employees may feel that their performance is unrecognized and not
valued, or that others in the organization are rewarded for the wrong behaviours.
Unrecognized and no valued performance can contribute to turnover.
Recognition for a job well done fills the employees' need to receive positive,
honest feedback for their efforts.
Need for Rewards and Recognition


Recognition should be part of the organization's culture because it contributes to

both employee satisfaction and retention. Organizations can avoid employee
turnover by rewarding top performers. Rewards are one of the keys to avoiding
turnover, especially if they are immediate, appropriate, and personal. A Harvard
University study concluded that organizations can avoid the disruption caused by
employee turnover by avoiding hiring mistakes and selecting and retaining top
One of the keys to avoiding turnover is to make rewards count. Rewards are to
be immediate, appropriate, and personal. Organizations may want to evaluate
whether getting a bonus at the end of the year is more or less rewarding than
getting smaller, more frequent payouts. Additionally, a personal note may mean
more than a generic company award. Employees should be asked for input on
their most desirable form of recognition. Use what employees say when it comes
time to reward for performance.
Designing a Rewards and and Recognition Solution
In designing a rewards and recognition program, the following guidelines should
be considered.

Rewards should be visible to all members of the organization.

Rewards should be based on well-defined, credible standards that have

been developed using observable achievements.

Rewards should have meaning and value for the recipient.
Rewards can be based on an event (achieving a designated goal) or

based on a time frame (performing well over a specific time period).

Rewards that are spontaneous (sometimes called on-the-spot awards) are
also highly motivating and should also use a set criteria and standard to

maintain credibility and meaning.

Rewards should be achievable and not out of reach by employees.
Nonmonetary rewards, if used, should be valued by the individual. For
example, an avid camper might be given a 10-day pass to a campsite, or,
if an individual enjoys physical activity, that employee might be given a

spa membership. The nonmonetary rewards are best received when they
are thoughtfully prepared and of highest quality. Professionalism in
presenting the reward is also interpreted as worthwhile recognition.
Rewards should be appropriate to the level of accomplishment received. A cash
award of $50 would be inappropriate for someone who just recommended a
process that saved the organization a million dollars. Determining the amount of
money given is a delicate matter of organizational debate in which organizational
history, financial parameters, and desired results are all factors. Recognition for a
job well done can be just as valued and appreciated as monetary awards. Formal
recognition program can be used with success. First Data Resources, a data
processing services company that employees more than 6,000 individuals in
Omaha, Nebraska, uses a formal recognition program (Adams, Mahaffey, and
Rick,2002). Rewards are given on a monthly, quarterly, and yearly basis, and
range from Nebraska football tickets, gift certificates, pens, plaques, mugs, and
other items.

One of the most popular awards at First Data is called the "Fat Cat Award" that
consists of: $500 gift check Professional portrait of the employee

Appreciation letter from the CEO and senior management

E-mails, phone calls, and notes from peers

In addition to non-monetary rewards, employees can be rewarded using money

in numerous ways. Cash is a welcome motivator and reward for improving
performance, whether at formal meetings or on the spot. Variable bonuses linked
to performance are another popular reward strategy. Profit sharing and pay-forskills are monetary bonus plans that both motivate individuals and improve goal
achievement. Small acts of recognition are valuable for employee daily
Retention. Sometimes a personal note may mean more than a generic company


In one survey, employees cited the following as meaningful rewards (Moss,


Employee of the month awards Years of service awards

Bonus pay (above and beyond overtime) for weekend work
Invitations for technicians to technical shows and other industry events
Meaningful and Retention Rewards

What gives meaning to rewards and recognition? What makes them effective?
First, rewards and recognition should be based on a clear set of standards, with
performance verifiable or observable. The standards for the reward should also
be achievable. If the reward is based on an unachievable result, such as a
production goal that is beyond employees' power, then those employees will not
be motivated. Meaningful rewards and recognition that are achievable have the
greatest impact.

Research is a systematic method of finding solutions to problems. It is essentially
an investigation, a recording and an analysis of evidence for the purpose of
gaining knowledge. According to Clifford woody, research comprises of defining
and redefining problem, formulating hypothesis or suggested solutions,
collecting, organizing and evaluating data, reaching conclusions, testing
conclusions to determine whether they fit the formulated hypothesis


Or Research is a process of collection, interpretation, analysis and presentation

of data into meaningful for the outcome of final decision.

Research Hypothesis
A hypothesis is a preliminary or tentative explanation or postulate by the
researcher of what the researcher considers the outcome of an investigation will
be. It is an informed/educated guess. It indicates the expectations of the
researcher regarding certain variables. It is the most specific way in which an
answer to a problem can be stated.
Research hypotheses are the specific testable predictions made about the
independent and dependent variables in the study. Hypotheses are couched in
terms of the particular independent and dependent variables that are going to be
used in the study. The research hypothesis of this study is as follows.
Ho: There is no significant relationship between incentives and employees
Ho: There

is no




career development

opportunities and the extent of employee retention.

Ho: There is no significant relationship between performance appraisal system
and the extent of retention.
Ho: There is no significant relationship between interpersonal relationship in the
organization and extent of motivation.


Objectives of the study

Primary objective
1. To study the important factors which are needed for the retention of the
Secondary Objective
1. To study the effect of monetary and non-monetary benefits provided by
the organization on the employees performance.
2. To study the effect of job promotions on employees.
3. To learn the employees satisfaction on the interpersonal relationship
exists in the organization.
4. To provide the practical suggestion for the improvement of organizations

Sampling Design
A sample design is a finite plan for obtaining a sample from a given population.
Simple random sampling is used for this study.
Sampling Procedure
The procedure adopted in the present study is probability sampling, which is
also known as chance sampling. Under this sampling design, every item of the
frame has an equal chance of inclusion in the sample
Nature of Research

Descriptive research, also known as statistical research, describes data and

characteristics about the population or phenomenon being studied. Descriptive
research answers the questions who, what, where, when and how.
Although the data description is factual, accurate and systematic, the research
cannot describe what caused a situation. Thus, descriptive research cannot be
used to create a causal relationship, where one variable affects another. In other
words, descriptive research can be said to have a low requirement for internal
A finite subset of population, selected from it with the objective of investigating its
properties called a sample. A sample is a representative part of the population. A
sample of 50 respondents in total has been randomly selected. The response to
various elements under each questions were totaled for the purpose of various
statistical testing.
Research instrument:
The Structured questionnaire is used as the research instrument for the study.

Questionnaire Design:
The questionnaire framed for the research study is a structured questionnaire in
which all the questions are predetermined before conducting the survey. The
form of question is of both closed and open type.
The questionnaire for the research was framed in a clear manner such that it
Enables the respondents to understand and answer the question easily. The
Questionnaire was designed in such a way that the questions are short and
simple and is arranged in a logical manner.
Area of study

The area of study is confined to employees of INFOSYS LTD,

Pilot study:
It is appropriate to conduct pilot survey to check the reliability of the
questionnaire. So pilot study was conducted on 5 respondents which is a 10% of
the sample.
Sampling design:
A Sample design is a definite plan for obtaining a sample from a given
population. It is the procedure used by the researcher in selecting items for the
Sample size
Number of the sampling units selected from the population is called the size of
the sample. Sample of 50 respondents were obtained from the organization.
Variables of the Study
The direct variable of the study is the employee retention.
Indirect variables are the incentives, interpersonal relations, career development
opportunities and performance appraisal system.
.Presentation of Data
The data are presented through charts and tables.
Tools and Techniques for Analysis
Correlation is used to test the hypothesis and draw inferences.



Primary data:
Primary data is the new or fresh data collected from the respondents through
structured scheduled questionnaire.
Secondary data:
The secondary data are collected through the structured questionnaire, literature
review and also from the past records maintained by the company.


Percentage = (No. Of respondents / total no. Of respondents)*100
Mean score = total score/no of respondents.
Where total score = no of respondents*weighted average


Q.1. Are you satisfied with the working hours of the organization?



Highly satisfied



Highly satisfied



(Chart 4.1)
The table shows that 58% of the respondents are satisfied with the working hours of the
organization. And 36% of the respondents are highly satisfied with the working hours of
the organization.

Q.2. Is management interested in motivating the employees?




Strongly Agree
Strongly Disagree






The table shows that 54% of the respondents are highly satisfied that the
management is interested in motivating the employees. And 40% of the
respondent are agreeing that the management is interested in motivating the
Q.3. Which type of incentives motivates you are getting more?




Financial Incentives
Non financial Incentives




The table shows that 52% of the respondents are expressing that both financial
and non financial incentives will equally motivate them.
Q.4. Are you Satisfy with the present incentives scheme?



Highly satisfied
Highly satisfied






The table shows that 58% of the respondents are satisfied with the present
incentive scheme of the organization.


Q.5. Is the company eagerness in recognizing and acknowledging

employees work?



Strongly Agree
Strongly Disagree





From the study, 58% of employees agreed that the company is eager in
recognizing and acknowledging their work, 36% strongly agreed and only 6%
showed neutral response.


Q.6. Are your associates committed to doing quality work?


No. of respondent












From the study it is clear that 60% of the employees states that their associates
committed to doing quality work. And 40% employees states that their fellow
employees somehow committed to doing quality work.


Q.7. In the last year, have you had opportunities to learn and grow?

Yes always
Finds difficult

No. of respondent




From the study it is clear that 50% employees have always had opportunities at
work to learn and grow. And 30% employees have had somehow opportunities at
work to learn and grow.

Q.8. Do you know what is expected of you at work?


Higher efficiency
Target achievement
Professional skill
Communication skill

No. of respondent


From the study it is clear that 50% employees know that they expected of higher
efficiency and 20% employees know that they are expected of target
achievement and 14% employees expected of professional skill at work.
Q.9. Is Job Security existing in the company?





Strongly Agree
Strongly Disagree



The table shows 35% of employees agree with good job security exist in the

Q.10. Have you Good relations with the co-workers?



Strongly Agree






Strongly Disagree



The table shows 54% of the respondents agree that they have good relations
with co-worker.

Q.11. Is there a Periodical increase in salary?




Strongly Agree





Strongly Disagree



The table shows 46% of employees agree that there is a periodical increase in
the salary.

Q.12. Is there Effective performance appraisal system in the company?




Strongly Agree
Strongly Disagree




The table shows 46% of the respondents agree to effective performance
appraisal system existing in the company.
Q.13. Are there enough Effective promotional opportunities in present job?



Strongly Agree
Strongly Disagree






The table shows 52% of the respondents agree with effective promotional
opportunities in their present job.

Q.14. Do you feel that your superiors commitment towards job is good?









The table shows 94% of the respondents agree that their superiors commitment
towards job and quality work is good.


Ho: There is no significant relationship between incentives and employees









Incentive Employee

Sig. (2-tailed)
Sum of Squares
Cross- 16.080
Sig. (2-tailed)
Sum of Squares
Cross- 13.000
** Correlation is significant at the 0.01 level (2-tailed).


Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis
that is There is no significant relationship between incentives and
employees performance is rejected and an alternative hypothesis is framed.
H1: There is significant relationship between incentives and employees
Ho: There

is no




career development

opportunities and the extent of employee retention

extent of












extent of
development retention


Sig. (2-tailed)
Sum of Squares 52.500
extent of retention Pearson
Sig. (2-tailed)
Sum of Squares 52.111
** Correlation is significant at the 0.01 level (2-tailed).


Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis
that is There is no significant relationship between career development
opportunities and the extent of employee retention is rejected and an
alternative hypothesis is framed.
H1: There is significant relationship between career development opportunities
and the extent of employee motivation
Ho: There is no significant relationship between performance appraisal system
and the extent of retention.

appraisal system







appraisal system

Sig. (2-tailed)
Sum of Squares
Cross- 64.000
of Pearson
Sig. (2-tailed)
Sum of Squares
Cross- 73.000
** Correlation is significant at the 0.01 level (2-tailed).



Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis
that is There is no significant relationship between performance appraisal
system and the extent of retention is rejected and an alternative hypothesis is
H1: There is significant relationship between performance appraisal system and
the extent of retention.
Ho: There is no significant relationship between interpersonal relationship in the
organization and extent of motivation.













Sig. (2-tailed)
Sum of Squares
Cross- 22.020
of Pearson
Sig. (2-tailed)
Sum of Squares
Cross- 32.260
** Correlation is significant at the 0.01 level (2-tailed).


Since the Correlation is significant at the 0.01 level (2-tailed) the null hypothesis
that is There is no significant relationship between interpersonal relationship in
the organization and extent of motivation. is rejected and an alternative
hypothesis is framed.
H1: There is significant relationship between interpersonal relationship in the
organization and extent of motivation.


The INFOSYS Limited has a well defined organization structure.

There is a harmonious relationship is exist in the organization between

employees and management.

The employees are really motivated by the management.

The employees are satisfied with the present incentive plan of the

Most of the workers agreed that the company is eager in recognizing and
acknowledging their work.

The study reveals that there is a good relationship exists among


Majority of the employees agreed that there job security to their present

The company is providing good safety measures for ensuring the

employees safety.

From the study it is clear that most of employees agrees to the fact that
performance appraisal activities and support from the coworkers in helpful
to get motivated.

The study reveals that increase in the salary will motivates the employees

The incentives and other benefits will influence the performance of the

From weighted Average analysis it is found that most of the respondents

are satisfied with the working hours of the organization.

From weighted Average analysis it is found that most of the respondents

are agreed that the management is interested in motivating the

From the weighted Average analysis it is found that most of the

respondents feel that their superiors commitment towards job is good.

1. Leading BPO organization INFOSYS is having a strong reputation base.
2. There are a great number of employees working in such concern and
growing since in the event of recession.

3. Most of the time employees are satisfied since the organization often bring
many welfare activities and programmes as well as incentives measures
just for the purposed of increasing the morale of the employees to perform
4. Greater turnover in India as well as abroad.

1. Executives and employees are made to work in right shifts at frequent
intervals since to meet the international requirements.
2. Sometimes female candidates failed to come or agree for night shifts
leading to either loss of valuable manpower and a loss of organization as
a whole.
3. Executives are employed at frequent intervals making a sense of job
insecurity for existing potential candidates.
4. There is a possibility of physical as well as mental harassment by seniors
as well as assisting colleagues.
5. Significance of grievance handling cell or department is very low.
6. Adequate arbitrary authorities are not enough to manage and handle the
grievance as found most of the times.

1. There is a great potential in such sector as there is no prescribed or
professional qualification to get into the industry: just required is the basic
qualification, good knowledge of computer basics with Internet as well as
fluency in English.


2. BPO Organization like Infosys and Genpact have initialized their efforts to
start thinking the welfare of their employees in more constructive methods.
3. There is more secure systems of work performance have been
implemented especially in night shifts where female are highly risky to
their work.

1. There is a risk and a great threat to females who are working in night
2. There is high risk of insecurity of job or being terminated any time due to
inefficient performance.
6. Executive and Employees were not ready for their free and unbiased views for
questions which were asked during project.
7. Also, the management was least interested due to busy schedule and
pressures of recessionary factors.
8. Since project was made to handle with the human resource so therefore
interest factor was also a major limitation.


1. The findings of the study are subjected to bias and prejudice of the
2. Time factor can be considered as a main limitation.
3. The findings of the study are solely based on the information provided by the

4. The accuracy of findings is limited by the accuracy of statistical tools used for
5. Findings of the research may change due to area, demography, age condition
of economy etc.


Employee should be provided with proper training.

Employee should be appreciated for good work.
Employee should be motivated to welcome the change.
If any changes are brought in to software or any module is added then

Training should be given.

Retention is an important concept that has been receiving considerable attention
from academicians, researchers and practicing HR managers. In its essence,
Retention comprises important elements such as the need or content, search
and choice of strategies, goal-directed behaviour, social comparison of rewards
reinforcement, and performance-satisfaction. The increasing attention paid
towards Retention is justified because of several reasons. Motivated employees
come out with new ways of doing jobs. They are quality oriented. They are more

Any technology needs motivated employees to adopt it successfully. Several

approaches to Retention are available. Early theories are too simplistic in their
approach towards Retention. For example, advocates of scientific Management
believe that money is the motivating factor. The Human Relations Movement
posits that social contacts will motivate workers. Mere knowledge about the
theories of Retention will not help manage their subordinates. They need to have
certain techniques that help them change the behavior of employees. One such
technique is reward. Reward, particularly money, is a motivator according to
need-based and process theories of Retention. For the behavioral scientists,
however, money is not important as a motivator. Being an outgrowth of
Herzbergs, two factor theory of Retention, job enrichment is considered to be a
powerful motivator. An enriched job has added responsibilities. The makes the
job interesting and rewarding. Job enlargement refers to adding a few more task
elements horizontally. Task variety helps motivate job holders. Job rotation
involves shifting an incumbent from one job to another.
It is very important for any organization to handle its human resource with ease
and comfort and therefore they offer various monetary as well as non-monetary
measures to them for their welfare so that they may be happy all the time during
their work. We would have conclude that raising and maintaining Employee
Retention lies in the hands of an organization and requires a perfect blend of
time, effort, commitment and investment to craft a successful endeavor

1. It is recommended that there should be a proper grievance system
which leads to the provision of selling various human resource
problems and their disputes amicably.
2. Further it is advisable that executives and employees are made to
know in advance the schedule of working so that they make up
their mind for it.


3. Also the work procedure should be flexible enough to provide the

ease and not to be burden on important resource of the
4. It is recommended that the recruitment, selection and placement of
such executives should not be such frequent as to cause a level of
insecurity in mind of existing valuable employees.
5. Furthermore, proper induction to be given to existing employees
and care must be taken to handle the harassment cases strictly
with disciplinary actions.
6. Proper training and development and renovation of the skills and
knowledge of existing employees for better and prosper results is
highly recommendable.
7. Develop an attractive employee value proposition.
An employee value proposition means that your company has
something attractive to offer that is perceived as valuable to an
employee, as an employer, you must understand what makes
your organization attractive to potential recruits and current
8. Create a total reward structure that includes more than
Every company should have all the normal compensation
mechanisms common to their type of employment. yet, total
rewards packages go far beyond money.
9. Give feedback on employee performance on a regular basis.
Ongoing performance feedback allows employee better know where
they stand, gives them a formal means to provide input, indicates that
their managers pay attention to

them and that their performance

matters. This feed contributes to employee engagement and



Be flexible in terms of work-life balance. Workers more and


value a balance between work and life. They want more flexible ways
to engage with their employer. To attract and retain workers with
different work and career expectations, organizations have to be more
flexible in structuring work and its expectations.
11. Create a culture of engagement. Employees have become more
connected with others in the organization (and the broader
supply-and-customer chain) through project-based team work
and process management activities. Employees are shifting
their loyalty to people, teams and projects and away from
company loyalty.
12. Train managers to be effective. Exit interviews consistently
show that poor and bad management practices greatly
contribute to an employees decision to leave a company. It is
imperative to provide supervisors and managers with adequate
tools to become effective managers since we cannot assume that
these competencies are innate.



Ashwathapa k, Human Resource & Personnel Management, Tata mc

graw-hill publishing new delhi,4 edition

Subba Rao p. Essentials of Human Resource Management & Industrial

Relation, Himalaya publishing house

Kothari, C.R. (2004).Research Methodology Methods & Techniques, 2 nd

revised edition(2007) New Delhi: New Age International Publishers









Management, 3rd edition ,prentice hall of India,

Mamoria C.B. Human Resource Management

Ellehuus Christoffer , Hudson Piers Driving Performance and

Retention Through Employee Retention Corporate leadership Council
2004, Employee Retention Survey

Journal of work and organizational psychology, 2004, 13 (3), 367-389




Job assignment..
Q.1. Are you satisfied with the working hours of the organization?
a. Highly Satisfied
b. Satisfied
c. Neutral
d. Dissatisfied
e. Highly Dissatisfied
Q.2. Is the management interested in motivating the employees?
a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree
Q.3. Which type of incentives motivate you are getting more?
a. Financial incentives
b. Non-financial incentives
c. Both

Q.4. Are you satisfy with the present incentives scheme?

a. Highly Satisfied
b. Satisfied
c. Neutral
d. Dissatisfied
e. Highly Dissatisfied


Q.5. Is the company eagerness in recognizing and acknowledging employees

a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree
Q.6. Are your associates committed to doing quality work?
a. Yes
b. Somehow
c. No
Q.7. In the last year, have you had opportunities to learn and grow?
a. Yes Always
b. Somehow
c. Finds Difficult
Q.8. Do you know what Is expected of you at work?
a. Higher Efficiency
b. Target Achievement

Professional Skills

d. Communication Skills
Q.9. Is job security existing in the company?
a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree


Q.10. Do you have good relations with co-workers?

a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree
Q.11. Is there Periodical Increase in Salary?
a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree
Q.12. Is there effective performance appraisal system exists in the company?
a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree

Q.13. Are there enough promotional opportunities in present job?

a. Strongly Agree
b. Agree
c. Neutral
d. Disagree
e. Strongly Disagree


Q.14. Do you feel that your superiors commitment towards job is good?
a. Yes
b. No
c. Occasionally

Q.1. Are you satisfied with the working hours of the organization?
a. Highly Satisfied


b. Satisfied


c. Neutral

d. Dissatisfied

e. Highly Dissatisfied


Q.2. Is the management interested in motivating the employees?

a. Strongly Agree


b. Agree


c. Neutral

d. Disagree

e. Strongly Disagree

Q.3. Which type of incentives motivate you are getting more?

a. Financial incentives


b. Non-financial incentives
c. Both


Q.4. Are you satisfy with the present incentives scheme?

a. Highly Satisfied


b. Satisfied


c. Neutral

d. Dissatisfied

e. Highly Dissatisfied

Q.5. Is the company eagerness in recognizing and acknowledging employees

a. Strongly Agree


b. Agree


c. Neutral

d. Disagree

e. Strongly Disagree

Q.6. Are your associates committed to doing quality work?

a. Yes


b. Somehow


c. No


Q.7. In the last year, have you had opportunities to learn and grow?
a. Yes Always


b. Somehow


c. Finds Difficult


Q.8. Do you know what Is expected of you at work?

a. Higher Efficiency


b. Target Achievement


c. Professional Skills

d. Communication Skills

Q.9. Is job security existing in the company?

a. Strongly Agree


b. Agree


c. Neutral


d. Disagree

e. Strongly Disagree

Q.10. Do you have good relations with co-workers?

a. Strongly Agree


b. Agree


c. Neutral

d. Disagree

e. Strongly Disagree

Q.11. Is there Periodical Increase in Salary?

a. Strongly Agree


b. Agree


c. Neutral

d. Disagree


e. Strongly Disagree

Q.12. Is there effective performance appraisal system exists in the company?

a. Strongly Agree


b. Agree


c. Neutral

d. Disagree

e. Strongly Disagree

Q.13. Are there enough promotional opportunities in present job?

a. Strongly Agree

b. Agree


c. Neutral

d. Disagree

e. Strongly Disagree

Q.14. Do you feel that your superiors commitment towards job is good?
a. Yes


b. No

c. Occasionally