As the world continue to discover the economics of Indian
talent. Indian business leaders increasingly worry about hanging on to their
key “breadwinners” o perhaps we should say” cake earners”. With the continuing
strong economic growth in many sectors, the buoyancy in hiring has improved and
correspondingly the level of attrition has increased. Retention of employees is
again the subject f concern in all our buoyant industries: IT, BPO, auto,
components, pharmaceuticals, and research and development.
Attrition figures depending on the industry and level vary
from 10 per cent to as high as 50, in some of the BPO segments. But figures of
20 per cent attrition especially at junior to middle levels (the one-year to
five year experience levels) are pretty common across a wide spectrum of
industries. For most companies the cost of attrition in terms of the attendant
hiring costs, training costs and discontinuity costs are often about 30 per
cent of the manpower costs! The search for the right retention tool and
insights in this respect is an industry in itself!
Employee satisfaction surveys and compensation surveys are
all tailored to address the issue f retention by providing “insights”. On what
the “Employee wants” and how to keep up with the Joneses next door or in our
industry. Most often companies look for quick fixes; and the answers are usually
in compensation, stock programmes, complex golden handcuff programmes feel god
programmes; retreats in Singapore or Zurich large brand building and induction
and orientation programmes! All of which are vitally important, but do not
necessarily address the retention problem in isolation.
While stock programmes were seen to be the most effective
retention for a long time, the crash and volatility in the stock markets have
reduced the relevance of this favourite tool. But they have also shown us that
employers of substance have a lot more “fundamentals” that work for them!
I do not knock the importance of either the surveys or the
consequent HR initiatives including the compensation and stock programmes but
feel that often organizations miss the basic points that build a great organization
and employee “stickiness”.
I have seen many organizations with fairly modest
compensation (not low) continue to attract excellent people. Take the HDFC
group for example, or TCS or Infosys. While us often search to uncover the
hidden “incentives” in these organizations: is their stock working for them, do
they have great benefits, do they send them abroad, do they make extraordinary
investments or training? Are they lucky to have great performance? Or be in the
right sector?
Yes, many of them do all of these and yet there are many other
organizations that d the same, but do not inspire the same amount of loyalty.
It is important to remember that most employees are simple
people wanting the comfort of a secure supportive environment and a decent (not
super) compensation and with reasonable opportunities to grow. But, what they
often look for in addition, is inspirational or strong leadership that the y
can ‘trust” and believe, when gives them comfort that their affairs are in good
hands even in bad or tough times, and who they believe will be “fair”.
“Fairness” is always the toughest issue because it is often
in the eyes of the beholder. AS several of our companies turn in good results,
there is often the question of what they must share with the shareholder and
the employee. When a company needs to restructure for better performance the
same debate can be in the reverse. The fairness and consistency of leadership
usually comes through at such times and is not lost on employees in the long
run.
Our surveys therefore need to lose track more strongly the
perceived fairness and trust our leaders evoke their ‘connect with people”. And
not just their business vision and acumen.
And lastly in India where the work we do is virtually our
only identity employees’ look to be part of an organization that they are proud
of in all respects. No retention programme can afford to ignore this reality.
1.
Why does the author say that most companies look
for quick fixes as far as retention is concerned?
A.
Because there is non-availability of any
research based study on the problem of retention, companies do not have fare
idea to deal with this problem.
B.
Because of the cut-throat competition in today’s
globalised world, retention is not a major issue for companies so they take it
lightly.
C.
Since most of the companies can afford the
losses due to attrition therefore they are least bothered.
D.
Because the focus on short term solution thereby
missing the finer retails of underlying basis of retention.
2.
What are the shortcomings of compensation
surveys and stock programmes? According to the author?
A.
Most of the surveys favour employers and hence
are partisan in nature.
B.
At times companies forget to examine the benefits of compensation
surveys and stock and try to implement them quickly
C.
These are the parts of traditional ways of
dealing with the problem therefore these methods are useless.
D.
Most of the compensation surveys and stock miss
the basics and also they do not focus employees stickiness.
3.
What are the key elements of employee
satisfaction according to the author?
A.
High growth and decent salary.
B.
Good H.R. initiatives and grievance policy
C.
Good training and recreational facilities
D.
Trust and fairness
4.
What is the advice that the author gives for
retention of employees?
A.
Companies must analyze the humanitarian aspect
of this problem.
B.
Since one of the problems in corporate sector therefore
it is to be solved by tried and tested ways.
C.
Companies must consider that “money is cure to
all ills” so they should focus on giving monetary incentives to their employees
in order to retain them
D.
That companies should focus not on short term
but on long term measures
Answer:
1.
D after
reading paragraphs 3& 4, D is the best option, hence the answer C is
factually wrong as in the passage it is mentioned that cost is generally high
and this shows that companies are not in position to bear this cost. A and B
are out of track and hence are rejected.
2.
D After
reading the last line of paragraph 5, option B seems to be right answer. In the
passage, Nothing has been given regarding the time or speed of the
implementation of survey and stock options so B rejected A and C are irrelevant
to the questions and are therefore rejected.
3.
D refer to paragraph 8 and 9
4.
D Read
paragraph 3 option C is factually wrong. Rests of the choice are out of
context.
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