Friday, February 3, 2012


The year was 2005. I was consulting with a company incubated by two ex-HCL directors. It was not delivering. In the prediagnostic phase the directors proudly proclaimed that the employee turnover at the organization was a piffling less than 5%. Intrigued, I wondered whether there lay the nub: had the employees reached the trough of their inefficiency? Further probing revealed that this was one cozy joint family like set up headed by condescending patriarchs rather than task oriented bosses. Recommendation went out from me: do away with the deadwood as of yesterday and change your own leadership style. Loyalty and long tenure are not necessarily something to strive for by the HR department. See how the Government of India functions with its bunch of ‘committed for life’ pool of manpower!

The other polar extreme is, however, the CIL case discussed in the present issue of Theory i Management. A quick turnover and high attrition rate are equally jaundiced and worrying situations. This may result partly from the mercenary like attitude of the Gen. Y hires, partly due to misplaced career expectations, but in no less measure also due to the preplacement spiel being dished out by the potential employer to the graduating batch. Within the first 2 years of joining nearly 10-20%. MBAs opt out of the companies they were placed in. This has massive direct and indirect cost implications for the employer.

MBAs nowadays are loyal to their profession, not to an organization. Many quit because they are given assignments that do not seem to add value to their careers. In a growing economy like India, myriads of opportunities are available, especially for premier B-School alumni. Indubitably money acts as hygiene and a motivating factor at least up to a level; many of them resign because they feel that the job content does not match expectation or the promise made in the PPTs; disaffectation sets in early. Or the compensation package may be designed in a manner that CTC is shown to be stratospheric. But upon disaggregation the net sum realized by the young joinee falls below the threshold. So perhaps instead of recruiting the ‘crème’, HR head should look for students with the right mental fit. The company can always tap the talent in the right way while keeping them excited about their job. Or, the company can possibly structure recruitment in different tiers and visit A plus, B grade, and even B minus category institutes. Most important, the recruiter must avoid raising expectations beyond what they intend delivering; else very soon a disconnect will be created leading eventually to parting of ways.

Many MBAs anyway lack the right attitude, are unwilling to learn, and want only high visibility jobs. This cannot possibly match each profile the company has in mind for future inductees. So the companies should not only articulate what they offer, but equally, what is not there on the menu. If you are not the best paymaster or offer ‘less’ glamorous profiles, be upfront about them. Instead, balance these negatives by (even if intangible) gains that a future employee can hope to enjoy in the event he decides to join in.

Even B-Schools can play a proactive role in avoiding future alienations by ensuring that the students opt for the specialization based on individual strengths and weaknesses, and not (as is generally the practice) on such frivolous considerations as which jobs are ‘hot’ nowadays! Meaningful summer internships go a long way in enabling a student to know what kind of career he should opt for. And even rotation among various departments in the company allows the new hire to form an idea as to where his predilections lie. His competencies may be mapped and then he may be guided about the profile most suited for him.

Attrition management adds to the bottomline of the company, remember.


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