It is sometimes good to be unwanted. You can see it when the management is looking for volunteers. India has always had some trouble spots. Would you like a posting at some of them? From an individual’s perspective, taking up such a challenge is an adventure as long as he does it at a fairly young age. But a trouble-shooter’s job does not mean that you should get shot at while tackling trouble.
What do you do in such a case? Do you stay or do you go? Attrition — a measure of people leaving a company — has traditionally been considered good for the employee. Assuming that it is a voluntary departure, you are probably going for higher pay and additional responsibilities. Though much is made of a rolling stone being shunned by employers, experience — even a few months at each place — counts. And you get a better idea of what your job content is supposed to be.
Of course, a very high level of attrition in, say, the voice business process outsourcing (BPO) sector may be detrimental for the employee. The stay-at-homes feel that there is something wrong with the organisation. Newcomers have no one to guide them as everyone is a newcomer. Some companies have an attrition rate of 200 per cent a year. If you have 100 employees, you have 200 departures a year. In other words, people are staying for just a couple of months and leaving. That can be dangerous.
Some HR practitioners hold that a high attrition rate can be helpful to the company too. Why does a person leave? It’s normally because he is getting a better deal somewhere else. If you had to retain him, you would have to match his expected salary. If you replace him with a newbie instead, your wage bill will be lower. Some jobs have become commodities today. These are the ones that report the highest attrition rates (see chart). “Smart” companies promote a handful. They replace those with a year’s experience with trainees. If the job doesn’t require any special skills, everything runs just as well. And the company saves on wages.
Attrition also brings in fresh blood. Even one or two newcomers with a modicum of experience can introduce new work styles and ways of getting the job done. High attrition means that you know all the best practices. Whether you implement them is another story.
“Over the years I have observed that the departure of a key employee has often been viewed with trepidation,” says a blogpost by Eric Britten, president of Britten & Associates, “But, months later in retrospect, the change was good. The organisation had hired or promoted a replacement who did things differently. Often the change was a good one, sometimes in very unexpected ways. Voluntary attrition is inevitable. So we might as well build the best mousetrap we can and then be as prepared as we can be for turnover.”
According to the experts, attrition comes in two varieties — good and bad. Says Lois Melbourne, a writer on HR issues: “Some attrition is good. If you have underperformers who are over their head in their position and they leave, this is good attrition. This can be a healthy churn. It is important to measure this attrition and put it in context.”
Her contention is that calculating only absolute numbers does not tell you the whole story. You have to learn how to separate good attrition from bad. When the doddering CEO leaves and everyone in the company quickly pays up his contribution to organise his farewell (lest he should change his mind), that’s good attrition. When his pretty young secretary goes, that’s bad.
THE MOVING SPIRIT
Attrition rates in India (%)
Capital goods 23
Non-voice BPO 26