RELATION BETWEEN THE ORGANIZATIONAL FACTORS …ijaema.com/gallery/48-august-2234.pdf · Attrition...

RELATION BETWEEN THE ORGANIZATIONAL FACTORS CONTRIBUTING

TO ATTRITION

G. Suganthi, PhD Research Scholar, Periyar University, Salem

Email: [email protected]

Dr. G. Selvalakshmi, Head of the Department of Commerce

Trinity College of Arts and Science, Namakkal

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Abstract

Human Resource is the biggest asset for the success of any organization; it is the

people who possess skills, abilities, and aptitudes that offer competitive advantage to a firm.

It is only human resource that is capable of deciding, implementing and controlling

activities. No computer can substitute human brain, no machines can run without human

interventions and no organization has mandate to exist if it cannot serve people‘s needs.

Women Attrition is a major issue that can be found is many Information technology sector

today, but escaping this issue is not a concept that is impossible. The research has reflected

in this paper, Attrition can be reduced by simply gaining the commitment of employees. It

can be done only by providing suitable job. The employer can retain the women employees

by providing safety and secured job, good working conditions, reasonable workload,

favourable work environment, positive interpersonal relationship etc. In order for

companies to stray away from the horrible effects of turnover, it is best that they develop

prevention methods such an in dept hiring/selection process or exit interviews, that allow

them to sustain employees.

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Key Words: Organization, Attrition & Relation

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1.1. Introduction

Human Resource is the biggest asset for the success of any organization; it is the

people who possess skills, abilities, and aptitudes that offer competitive advantage to a firm.

It is only human resource that is capable of deciding, implementing and controlling activities.

The International journal of analytical and experimental modal analysis

Volume XI, Issue VIII, August/2019

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No computer can substitute human brain, no machines can run without human interventions

and no organization has mandate to exist if it cannot serve people‘s needs.

Organizations to be dynamic and successful should possess dynamic human resource

who can acquire capabilities continuously with changing requirements of the organization

and this can be achieved through Human Resource Management. Human Resource

Management is mainly concerned with recruiting capable, dynamic and committed people; it

is also aimed at organization development, safety, wellness, benefits, employee motivation,

communication, administration, training, and rewarding the performance of the human

resource and developing key competencies in them.

Human Resource Management is always a deep-rooted comprehensive activity taken

up to improve the quality of the people who are the vital assets of the organization. Human

Resource Management can be termed as - Art and Science as it is the art of managing people

by recourse to creative and innovative approaches; it is a science as well because of the

precision and rigorous application of theory that is required.

1.2. Attrition in Information Technology Industry

Attrition ‘is the prime problem faced by Indian Information Technology industry.

Women attrition is a gradual, natural reduction in female membership or personnel, as

through retirement, resignation, death or due to any other reasons.

Attrition is a critical issue and pretty high in the industry these days. It‘s the major

problem which highlights in all the organizations. Though the term attrition ‘is common,

many would be at a loss to define what actually attrition is, attrition is said to be the gradual

reduction in the number of employees through retirement, resignation or death. It can also be

said as employee turnover or employee defection whenever a well-trained and well-adapted

employee leaves the organization, it creates a vacuum. So, the organization loses key skills,

knowledge and business relationships. Modern managers and personnel administrators are

greatly interested in reducing attrition in the organization, in such a way that it will contribute

to the maximum effectiveness, growth, and progress of the organization.

Attrition among female and minority faculty is a serious problem especially in

Information Technology sector, Further Retaining employees is a critical and ongoing effort.

One of the biggest challenges in having managers in the place that understands it is their



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responsibility to create and sustain an environment that fosters retention. Staffs require

reinforcement, direction and recognition to grow and remain satisfied in their positions.

Managers must recognize this and understand that establishing such fundamentals

demonstrates their objectives to support nature and motivate their employees. Companies in

India as well as in other countries face a formidable challenge of recruiting and retaining

talents while at the same time having to manage talent loss through attrition be that due to

industry downturns or through voluntary individual turnover. Losing talents and employees

result in performance

losses which can have long term negative effect on companies especially if the

departing talent leaves gaps in its execution capability and human resource functioning which

not only includes lost productivity but also possibly loss of work team harmony and social

goodwill. With attrition rates being a bane of every industry, companies are devising

innovative business models for effective retention of talent. There are a lot of factors

responsible for attrition and employers are getting increasingly conscious of the factors that

can keep an employee committed.

The employee gradually reduces his / her ties with the company than crib about the

underlying factors causing attrition. It is symptomatic of a much deeper malaise that cuts

deeper into the innards of organizations. Attrition rates vary from sector and industry to

industry. Apart from the unavoidable ones like resignation, retirement, death or disability, the

causes are found to be many and varied.

They vary according to the nature of business, the level of the employees and the

nature of the responsibility shouldered by them. The obvious, common and main reasons are

the ergonomic discomfort experienced by the employee and the functional incompatibility

between the corporate management and the employees. Very often an employee finds himself

among colleagues and superiors he is unable to cope up with. Or he finds himself/herself

totally out of tune in his functions with the employee‘s functional requirements, failing to rise

to the / employer‘s expectations. Another important reason is that the employee‘s

remuneration is not voluminous enough to bear the brunt and cushion the concussions of his

family and social life.

Employee retention refers to policies and practices companies use to prevent valuable

employees from leaving their jobs. How to retain valuable employees is one of the biggest



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problem that plague companies in the competitive marketplace. Not too long ago, companies

accepted the revolving door policy as part of doing business and were quick to fill a vacant

job with another eager candidate.

Nowadays, businesses often find that they spend considerable time, effort, and money

to train an employee only to have them develop into a valuable commodity and leave the

company for greener pastures. In order to create a successful company, employers should

consider as many options as possible when it comes to retaining employees, while at the same

time securing their trust and loyalty so they have less of a desire to leave in the future.

Employees need to be retained because good, faithful, trained and hard working employees

are required to run business.

They have acquired good product knowledge over the long run and a trained

employee can handle customers better and also solve problems of peers who are new to the

organization. When an employee leaves he takes away with him all company information

such as ongoing projects, etc. Goodwill of the company gets hampered due to more employee

turnover rate and the competitors start poking their nose to recruit best talents from them.

Efficiency of work is hampered to a large extent. Let me give you an example; if an

employee leaves in the middle of an ongoing project it’s very difficult to fill that Vacuum and

a new employee can never replace an old and talented employee so this leads to delayed

completion of projects and less work satisfaction among other team members.

Attrition has hampered the growth of many Information Technology companies; Top

most companies like Infosys, TCS, Wipro and Dell etc are undergoing huge attrition issues.

As we see major employees are females the above table depicts the rate of female employees

in top most I.T companies compare to previous years.

1.3. Reasons for Attrition in BPO and ITES Industries

According to NASSCOM, the cost of attrition in the Indian BPO and ITES is 1.5 times the

annual salary. So it becomes all the more necessary for BPO industry to explore into the

reasons for this high attrition rate. The main reasons which have led to this problem are

Improper work Timing

Family Pressure



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Health problems due to imbalance in work-life pattern

Peer Pressure

Lack of growth options within the company

Other Career options like pursuing further education, joining other Sectors

Salary (at lower levels)

It means not only loss of talent, but also includes the cost of training the new recruits.

According to different reports of all the challenges posed to I.T organizations at various

levels, attrition, absenteeism and motivating employees are the major ones that dominate at

the middle level. The attrition rate in the industry has been hovering around 35%, which is

quite high for any industry. According to some analysts in general, the attrition rate fluctuates

between 20% and 40%, while in the best companies, it averages around 15 per cent.

1.4. Review of Literature

The study on “Nine elements that trigger employee attrition – A study on BPO’S

Visakhapatnam” conducted by Narayana Rao and Subbarayudu (2017), revealed that every

organization is comprised of people. Acquiring their services, developing their skills,

motivating them to high levels of performance, and ensuring that they maintain their

commitment to the organization are essential to achieving organizational objectives. Business

Process Outsourcing, commonly known as BPO, is one of the organization is comprised of

huge manpower. The Indian BPO industry has grown at a constant annual rate of 40-50 per

cent and within a couple of years, India managed to secure the position of the most preferred

and low cost destination for business process outsourcing. Ironically, in spite of the

tremendous growth potential of the sector, attrition rate and the manpower crisis is

dampening the growth of the sector. The HR professionals of the BPO industry are facing

various challenges like the attrition rates and its implications, skill shortages, retaining the

employees etc. The study reveals that in ordered to reduce attrition industry should analysis

the above nine dimensions which creates more intentions of creating high attrition in the

arena of BPO sector.

Sharda, Ganguli, David (2017), conducted a study on “Women Workforce

Attrition Dynamics in Indian IT/ ITES Sector”. The objective of the study is to identify



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various factors responsible for women's workforce attrition in Indian IT/ITES sector.

Thematic analysis was used to generate the factors affecting women's workforce attrition.

And this study is consistent with the findings of Brett and Stroh, (1994), states the women

professionals experience higher levels of stress at work and are leaving the organization for

better career opportunities elsewhere. The present study is providing two major categories of

reasons behind women workforce attrition on the basis of the unfolding theory of attrition.

This can be considered as a detailed study which discusses both internal and external reasons

for women workforce attrition. Starting with the first theme family responsibilities and life

balance, managers need to understand that women are still performing the majority of

domestic and child care activities.

The study entitled “Employees attrition and it’s determinants in service sector”

conducted by Sundararajan (2016), states that the high attrition rate causes a high employee

turnover in an organization, reducing quantity and quality of an organization’s manpower.

Employee attrition reveals an organization’s internal power and weaknesses. New employee

need to be constantly added, further costs in training them, getting them aligned to the

organization environment. Organizations also face difficulties in retaining the employees as

well as attracting potential employees. In this competitive business era, high attrition rates

lead to many issues in the boundary of HR people. This study reveals that the attrition rate of

health care sector in Coimbatore for the year 2015 – 2016 is 35 per cent. The main reasons

for attrition are higher studies, marriage, alternative job opportunities and insufficient

payment. The suggestions given by the employees who left the organization are better

working employment and job security. Based on the result of this study, it can be concluded

that employee retention strategy was a major factor that greatly contributed to high employee

turnover rates in the organization. Insufficient payment, work pressure, external pressure

greatly contributed to high employee turnover rates in the organization since the

organization’s salary structure was not competitive. Finally it can be concluded that the

organization’s stressful working environment with less benefits has contributed to high

employee turnover. Hence the organizations should focus on the measures that will attract

employees to stay inside the organization.

The study entitled “Attrition from Student Affairs: Perspectives from Those Who

Exited the Profession” conducted by Marshall (2016), The results of this study shed light

on the reasons attrition is an issue of concern within student affairs. It remains an open



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question whether or not attrition in this field exceeds other careers or if it is a natural

progression for many individuals, regardless of the profession. Nevertheless, significant

concerns do exist about the quality of professional life for many student affairs professionals,

and such concerns should be considered and addressed in an effort to enhance and strengthen

the overall professional experience in the field of student affairs. Current fiscal constraints

within the field as a whole often result in staff downsizing, dwindling material, capital,

human resources, and unfilled positions. During these times, increasing employee loyalty,

satisfaction, and job commitment is imperative. Enhanced attention to effective

communication, mentor programs, and skills to balance work and life are paramount and may

lead to increased job satisfaction and retention. As professional associations continue to

review best practices and create core competencies for new professionals, engagement in an

honest and forthright conversation about student affairs attrition is required. Professional

associations and graduate preparation programs must strive to paint a realistic picture of the

profession, emphasizing the altruistic nature of the field and preparing new professionals for

the high expectations placed upon student affairs. It is often easier to highlight those

outwardly rewarding facets of the profession while skirting the less appealing components of

the profession. Such conversations will help ensure that only those who view the profession

as a vocation rather than simply a job will enter and remain in student affairs field.

1.5. Objectives of the Study

To Study the relation between the Variables of Organizational Factors

Contributing to Attrition.

1.6. Sampling Method

The study is descriptive in nature, with the sampling method of Multi stage random

sampling. The researcher has considered the same and identified 460 respondents for the

study, with a confidence level of 95 percent and confidence interval of 5 percent. As per the

record of http: // www. bangalorecircle. Com / pages / IT.html, the top ten Information

technology companies were selected in the first stage. Then the top level women employees

were selected on random basis in the second stage (1500 Employees were shortlisted, source:

http:// www. thehindu. com). The simple random sampling technique was adopted to select

460 respondents in the third stage. On an average 500 questionnaires were distributed and

472 were received. The remaining 28 questionnaire were biased and unanswered.



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Table. 4.1. Correlation between the Variables of Organizational Factors

Contributing to Attrition

H0: There is no significant correlation between the variables of “organizational factors

contributing to attrition”.

Variables WPC WO WOE COM TR CGK MOT PESF PPO SRWE OFCA

WPC PC 1

WO PC .233** 1

WOE PC -.165** -.248** 1

COM PC .184** .129** -.364** 1

TR PC -.146** -.130** .437** -.348** 1

CGK PC -.018 -.045 .406** -.203** .487** 1

MOT PC .231** .300** -.434** .197** -.252** -.252** 1

PESF PC .145** .128** -.344** .303** -.255** -.242** .303** 1

PPO PC -.146** -.066 .308** -.176** .323** .085 -.113* -.044 1

SRWE PC -.144** -.165** .470** -.330** .477** .364** -.319** -.215** .302** 1

OFCA PC -.033 .000 .412** -.086 .477** .381** -.233** -.096* .484** .486** 1

ADOPT PC -.050 -.014 .017 .042 -.027 -.036 .076 .048 .013 .026 .005

**. Correlation is significant at the 0.01 level (2-tailed). CGK - Career Growth and Knowledge

*. Correlation is significant at the 0.05 level (2-tailed). MOT - Motivation

PC – Pearson Correlation PESF - Personal Factors

WPC - Work Place Climate PPO - Performance and Productivity of Organisation

WO - Work SRWE - Strategies / Techniques to Retaining Women Employee

WOE - Work Environment OFCA - Organizational Factors Contributing to Attrition

COM - Compensation ADOPT - Appropriate Strategies Adopted to Retain Women Employees

TR - Training

Positive Correlation

The variable work place climate has positive correlation with the variables like work

(0.233); compensation (0.184); motivation (0.231) and personal factors (0.145). Similarly the

variable work has positive correlation with the variables like compensation (0.129);

motivation (0.300) and personal factors (0.128). Similarly the variable work environment has

positive correlation with the variables like training (0.437); career growth and knowledge

(0.406); performance and productivity of organisation (0.308); strategies / techniques to

retaining women employee (0.470) and organizational factors contributing to attrition

(0.412). Similarly the variable compensation has positive correlation with the variables like

motivation (0.197) and personal factors (0.303). Similarly the variable training has positive

correlation with the variables like career growth and knowledge (0.487); performance and

productivity of organisation (0.323); strategies / techniques to retaining women employee

(0.477) and organizational factors contributing to attrition (0.477).

Similarly the variable career growth and knowledge has positive correlation with the

variables like strategies / techniques to retaining women employee (0.364) and organizational

factors contributing to attrition (0.381). Similarly the variable motivation has positive

correlation with the variable like personal factors (0.303). Similarly the variable performance

and productivity of organisation has positive correlation with the variables like strategies /



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techniques to retaining women employee (0.302) and organizational factors contributing to

attrition (0.484). And finally the variable strategies / techniques to retaining women employee

has positive correlation with the variable like organizational factors contributing to attrition

(0.486).

Negative Correlation

The variable work place climate has negative correlation with the variables like work

environment (-0.165); training (-0.146); performance and productivity of organisation (-

0.146) and strategies / techniques to retaining women employee (-0.144). Similarly the

variable work has negative correlation with the variables like work environment (-0.248);

training (-0.130) and strategies / techniques to retaining women employee (-0.165). Similarly

the variable work environment has negative correlation with the variables like compensation

(-0.364); motivation (-0.434) and personal factors (-0.344). Similarly the variable

compensation has negative correlation with the variables like training (-0.348); career growth

and knowledge (-0.203); performance and productivity of organisation (-0.176) and strategies

/ techniques to retaining women employee (-0.330). Similarly the variable training has

negative correlation with the variables like motivation (-0.252) and personal factors (-0.255).

Similarly the variable career growth and knowledge has negative correlation with the

variables like motivation (-0.252) and personal factors (-0.242). Similarly the variable

motivation has negative correlation with the variables like performance and productivity of

organisation (-0.113); strategies / techniques to retaining women employee (-0.319) and

organizational factors contributing to attrition (-0.233). And finally the personal factors has

negative correlation with the variables like strategies / techniques to retaining women

employee (-0.215) and organizational factors contributing to attrition (-0.096).

No Correlation

The variable work place climate has no correlation with the variables like career

growth and knowledge and organizational factors contributing to attrition. Similarly the

variable work has no correlation with the variables like career growth and knowledge;

performance and productivity of organisation and organizational factors contributing to

attrition. Similarly the variable compensation has no correlation with the variable like

organizational factors contributing to attrition. Similarly the variable career growth and

knowledge has no correlation with the variable like performance and productivity of



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organisation. And finally the variable personal factors have no correlation with the variable

like performance and productivity of organisation.

1.7. Suggestions

The researchers suggest the management, corporate leaders and mangers to

understand the difference between values of men and women. It is an unquestionable fact that

men and women are different in many core ways. And this study is consistent with the

findings of Brett and Stroh, (1994), that states the women professionals experience higher

levels of stress at work and it becomes a main reason for them to leave the organization for

better career opportunities in other organisation, where they feel better.

The present study reveals that the level of work, work environment, compensation,

training, career growth and knowledge and performance and productivity significantly has a

lower level of influence over the organizational factors contributing to attrition. Similarly the

strategies / techniques to retain employees have also the lower level of influence over the

organizational factors contributing to attrition. This can be considered as a detailed study

which discusses both internal and external reasons for women workforce attrition. Starting

with the first theme family responsibilities and life balance, managers need to understand that

women are still performing the majority of domestic and child care activities. An

organization must try to provide best work life friendly environment. Respondents felt that

they are pushed aside regularly when they make their priorities known or demand time off

after having a child. The finding of the study is supporting the concern of Hochschild and

Machung (1989) that entrance of women in paid occupations leads to imbalance in overall

family economics which results in increase in divorce rates. The results of our study are also

consistent with Reddy, Vranda, Ahmed, Nirmala, and Siddaramu, (2010). They empirically

examined the impact of size of family, the age of children, the work hours and the level of

social support. The problem of work life imbalance can be addressed to some extend by

providing flexible working hour and work from home options. This will help women

professionals in maintaining time and involvement balance between work and personal lives.

1.8. Recommendations and Future Implications

Designing jobs for teams, goals that motivate, enhancing goal acceptance, incentives

for individuals (tied to performance: bonuses, commissions, piecework), incentives for

groups are effective reward systems. In designing jobs for teams, the team should be an



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identifiable group, doing a specified piece of work, and be self-managing. Employers must

respect the employee's needs for work/life balance as more and more employees have made it

clear that achieving work/life balance is an overriding priority. In order to ensure that

organisations retain their top talent, they should nurture and take a more holistic approach to

their employees’ welfare. Work arrangements being increasingly adopted at leading

Corporations include: flexible hours, part-time, job-sharing and telecommuting; no longer

uncommon are the sabbaticals for long-serving personnel or those pursuing special outside

interests, and extended leave periods for new parents. The fact that outsourcing is gradually

eroding the basic rights and privileges of outsourced personnel cannot be disputed. It is

timely for the Department of Labour to make an analytical survey of the various

multinational business institutions that have outsourced its core and ancillary functions and

examine how far new forms of work arrangements in outsourcing and subcontracting provide

for security of employment. Outsourcing creates a whole new culture in the labour market.

New laws and regulations are needed to govern the outsourcing industry.

Having regard to the dangers involved if a policy decision has been taken to outsource

the core business of a company, certain precautions are required before entering into and

administering these requirements. Care should be taken to ensure that instructions are given

to the worker by the contractor and not directly by the employer and preventing employees of

the permanent cadre. Often there is a question as to who manage and motivate staff. The end

result is low performance and low motivation levels of staff. Therefore, it is important to

manage and motivate staff performing outsourced tasks to get the maximum benefits of

outsourcing.

1.9. Conclusion

Women Attrition is a major issue that can be found is many Information technology

sector today, but escaping this issue is not a concept that is impossible. The research has

reflected in this paper, Attrition can be reduced by simply gaining the commitment of

employees. It can be done only by providing suitable job. The employer can retain the

women employees by providing safety and secured job, good working conditions, reasonable

workload, favourable work environment, positive interpersonal relationship etc. In order for

companies to stray away from the horrible effects of turnover, it is best that they develop

prevention methods such an in dept hiring/selection process or exit interviews, that allow

them to sustain employees. When Attrition is suspected within an organization, an accurate



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measure of past and existing Attrition must be analyzed. Once both of these issues have been

studied, companies can decide on the proper solutions according to their analyses, the

ultimate one being the attainment of employee loyalty and commitment.

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