Building an engaged workforce: innovative ways of engaging employees and

ensure stickiness with the organization

Attrition and Attrition Rate:

Attrition is defined as a reduction in the number of employees. Attrition arises with employees leave the company
for one of the three reasons:

1. Death of employee
2. Retirement
3. Better opportunity in some other company.

Attrition rate is the rate of shrinkage in size or number of the employees.

Cost of Attrition:

1. Hiring or Recruitment cost

2. Training cost
3. Low productivity cost
4. New hiring cost
5. Low sales cost

1. Hiring or Recruitment Costs: Costs of advertisement, agency costs, employee referral costs, internet posting
costs, etc.

2. Training Costs: Induction program costs, lodging costs during that period, orientation material costs and cost of
person who conducts orientation.

3. Low Productivity Costs: As new employee is learning new job, company policies, etc., they are not fully
productive.

4. New Hiring Costs: Cost of bringing new person aboard, time taken in understanding the job of the employee
who left and other perks given.

5. Low Sales Cost: Experience and the contacts that were lost, time for which the position was vacant and other
such things which result in either loss of customers or lower sales.

Why Attrition Happens:

Attrition happens in two ways, one is because of employer and other is because of employee

1. Higher pay
2. Work timings
3. Career Growth
4. Higher education

1. Workplace / Environmental Influences:

Working hours and toughness of work will play major role in employee satisfaction. Employee will see for other
opportunities if working hours won’t suitable to spend for his personal life and family.

2. Training:
Besides the induction and project training, not much investment has been done to evolve a "continuous training
program" for the agents. Motivational training is still to evolve in this industry

3. Vague Vision & Values:

Senior management must articulate a clear and compelling vision for the organization in order for it to succeed.
People join and stay with companies where they feel their job is important to organizations growth.

4. Lack of Positive Direction:

Poorly prepared management can potentially communicate an undesirable message of apathy and frustration to
employees, which can be detrimental the growth of the organization.

5. Limited or Lack-Luster Training:

Employees want to continually upgrade their skills and expect that employers will facilitate. In fact, research shows
that employees are three times more likely to leave a company that does not provide job-related training.

6. Hiring that Misfires:

While hiring people have to check whether candidate fits for organizational culture and job environment.
Because best suited employee can be stick to organization for longer time.
7. Women in Workforce:
Most of women leave work after marriage or because of social pressure in working hours or working place. It is
true in most cases in BPO industry because of work timings.

8. Inadequate Managers:
The companies should have the foresight to invest in management teams that can grow faster than the production
staff. A lot of firms are losing people because their managers are too thinly staffed who are always fighting fires
rather than doing proactive work.

9. Employee Database Leakage:

Normally database leakage will happen because of the HR staff or database administrators or any other employee
when he joins another organization or through outsourced human resource vendors. It will lead to attrition.

10. Overwork & Burnout:

Unrealistic expectations are de-motivators, not incentives. Irregular hours and meal-times, lack of rest resulting in
physical strain, high-stress environments, etc., cause employees to burn out and re-evaluate their willingness to
work in places like call centers.

HR managers have work on these aspects to get reduction in Attrition.

The EEE-Model

Exposure, Experience and Education are three things which are vital to any employee in any sector or industry.
These needs of the employees are needed to be taken care of for an employee to feel motivated.
Techniques already in practice to ensure employee stickiness with the organizations

1. Shift rotation - It is said that "Permanent night birds fly away faster". To retain them, suitable day-shift
opportunities should be provided from time to time

2. Flexi Timing

3. Monthly Party

4. Shop till you drop - Tie-up with a shopping mall for an evening outing and distributing prizes based on that.

5. Housing

6. Cash Incentives (good rewards)

7. Career Guidance

8. Bonding Techniques

9. Pressure Relievers

10. Flexible Working Hours

11. Stronger Career Path

12. Growth Opportunities (within the company)

13. Education (learn while you earn)

The OREEM is based on current theory within organizational psychology and human resource management and has
been validated through numerous studies conducted in Australia and overseas.

According to OREEM, factors affecting the employee stickiness with organization.

 Intrinsic Rewards
 Goal Clarity
 Job-Skills Match
 Immediate Manager
 Autonomy/Empowerment
 Performance Feedback/Accountability
 Remuneration
 Recognition and Feeling Valued
 Work-Life Balance
 Team Performance and Relationships
 Career Progression
 Senior Leaders
 Agency Culture
 Learning and Development
 Housing:

Hire outstation candidates (preferably non-metro) and put them up in shared company accommodation. As an
incentive, pick up utility bills. If the employee leaves, he or she loses the apartment.

Who is doing it:

exl Service.com

Education:

Offer management diplomas and MBA courses as most fresh graduates want to study further. Also give incentives
like scholarships. If they leave in between, they have to discontinue the course.

Who is doing it:

GE, Wipro Spectramind

Cash Incentives:

As only 5 out of 150 employees become team leaders in a year, cash incentives are a great way to get employees to
stay on. The bonus - performance boost.

Who is doing it:

Daksh e-Services, Global Vantedge

Career Concerns:

Use various filters like psychometric tests to get people who can work at night and handle the monotony. Career
counseling and planning career paths also helps.

Who is doing it:

HCL Tech BPO Services, GTL, Tracmail, Vertex India.

Generally organizations use two categories of motivation theories, which can motivate employee to stick to their
organization. They are briefly explained below.

Two categories of motivation theories:

Motivational theories can be divided into two categories, content and process theories. Content theories assume
that all individuals possess the same set of needs and therefore prescribe the characteristics that ought to be present
in jobs.
Process theories stress the difference in people’s needs and focus on the cognitive processes that create these
differences.
Maslow (1954) outlined the most influential of content theories. He suggested a hierarchy of needs up which
progress. Once individuals have satisfied one need in the hierarchy, it ceases to motivate their behavior and they
are motivated by the need at the next level up the hierarchy.
1. Physiological needs such as hunger and thirst are the first level on the hierarchy.
2. Security needs such as shelter and protection are the next level.
3. Social needs such as need for satisfactory and supportive relationships are the next level.
4. From these needs, the individual can move up the hierarchy to higher order needs. Self –esteem needs for
recognition and a belief in oneself is the next level.
5. Finally, the progression leads to the need to realize one’s full potential, which is termed self – actualization. Only
a small proportion of the population achieves this level.
This theory was not intended as an explanation of motivation in the workplace; however, many managerial theorists
have enthusiastically adopted it. The theory suggests that employees will always tend to want more from their
employers. When they have satisfied their subsistence needs, they strive to fulfill security needs. When jobs are
secure they will seek ways of satisfying social needs and if successful will seek the means to the ultimate end of self
– actualization.
Alderfer (1972) suggests that individual needs can be divided into three groups:
1. Existence needs, which include nutritional and material requirements (at work this would include pay and
conditions.)
2. Relatedness needs, which are met through relationships with family and friends and at work with colleagues.
3. Growth needs, which reflect a desire for personal psychological developments. Alderfer’s theory differs from
Maslow in a number of important respects.
Alderfer argued that it was better to think in terms of a continuum rather than a hierarchy; from concrete existence
needs to least concrete growth needs and argued that you could move along this in either direction.
Maslow argued that when satisfied a need becomes less important to an individual, but Alderfer argues that
relatedness or growth needs become more important when satisfied. This means that team - working arrangements
can continue to motivate employees and are not necessarily superseded by growth needs.
Mumford (1976) argues that workers have:
1. Knowledge needs, work that utilizes their knowledge and skills.
2. Psychological needs, such as recognition, responsibility, status and advancement.
3. Task needs, which include the need for meaningful work and some degree of autonomy.
4. Moral needs, to be treated in the way those employers would themselves wish to be treated.
Mumford’s assumption was that employees did not simply see their job as a means to an end
by had needs which related to the nature of their work.
Hertzberg (1959) presented a two – factor theory, which looks at motivators and hygiene’s and proposed that job
satisfaction and dissatisfaction appeared to be caused by two sets of different factors. The resence of motivators in
the workplace caused enduring states of motivation in employees but their absence did not lead to dissatisfaction.
Hygiene on the other hand produced an acceptable working environment but did not increase satisfaction – their
absence did however cause job dissatisfaction.
Motivators Hygienes

Responsibility Supervision

Recognition Salary

Promotion Work environment

Achievement Company policies

Intrinsic aspects of the job Relationship with colleagues

This theory suggests how people’s jobs can be redesigned to incorporate more motivators.
Point 3 – Process theories
What all process theories have in common is an emphasis on the cognitive processes in determining his or her level
of motivation.
Equity theory assumes that one important cognitive process involves people looking around and observing what
effort other people are putting into their work and what rewards follow them. This social comparison process is
driven by our concern for fairness and equity.
Research by Adams (1965) and others confirms equity theory as one of the most useful frameworks for
understanding work motivation.
Valence, instrumentality and expectancy (VIE) theory had resulted from Vroom’s (1964) work into motivation. His
argument was that crucial to motivation at work was the perception of a link between effort and reward. Perceiving
this link could be thought of as a process in which individuals calculated first whether there was a connection
between effort and reward and then the probability (valences) would follow from high performance
(instrumentality.) The motivational force of a job can therefore be calculated if the expectancy, instrumentality and
valence values are known. The individual’s abilities, traits, role perceptions and opportunities attenuate the
motivational force.
The main contribution of both types of process theory has been to highlight the effects of cognitive and perceptual
processes on objective work conditions. It suggests that managers need to pay attention to four main aspects of their
subordinate’s perceptions:
1. Focus on the crucial expectancy values (the link between effort and their performance.)
2. Managers should determine what outcome employee values.
3. They need to link the reward that subordinates value to their performance.
4. Managers need to ensure that wage rates are not perceived as inequitable.
Point 4 – Knowledge of results and goal – setting
Despite a wealth of research highlighting the positive motivational benefits of knowledge of results many
organizations still provide employees with little or no information about their performance. Although feedback can
have considerable impact on both motivation and learning, implementing feedback systems can have wider
implications. Feedback can affect the relationship between employees and managers by disrupting existing
authority structures.
Guirdham (1995) suggests for feedback to be effective it needs to be:
1. Generally positive – reward is more effective than punishment.
2. Well timed – as soon as possible.
3. Control – the feedback should be about behavior the individual has control over.
4. Specific feedback and not general.
5. Publicly observed and not based on revelations or secrets.
6. Sensitive so that it does not trigger the individuals defense mechanisms.
Locke (1968) offers the theory of goal – setting as a means of motivation. Here goals direct effort and provide
guidelines for deciding how much effort to put into each activity when there are multiple goals. Participation in
goal – setting increases the individual's sense of control and fairness in the process.

TOP MOST COMPANIES WHICH ARE FOLLWING INNOVATIVE HR STRATEGIES FOR

EMPLOYEE ENGAGEMENT AND STICKINESS WITH THEIR COMPANY ARE:

Hughes Software Systems

Managers give "Snap Awards" for individual and team achievements to their teams when they excel or do
something outstanding. These are usually given during the quarterly staff meetings where all employees participate
and this is followed by a party.

There is Annual Achievement Award under four categories:

 Most Initiatives
 Best Customer Orientation
 Best Team Worker
 Most Innovative.

Managers send nominations every year and a task force of senior managers picks the winners.

There are Presidential Awards for overall excellence. These are given annually and are in four categories:

 Engineering
 Business Development
 Non-Engineering
 Engineering/Customer Support.

There is an award for Best People and Project Managers, given to two best managers and leaders each year.

 Popular Awards provide very powerful peer recognition. This is very credible and most satisfying. The
winners are then put in special roles e.g. the winner of "Best Leader" award is the one who conducts the
session on leadership in the development program for managers. The person chosen as the "Best Mentor"
leads the implementation of the mentoring program.
CISCO

The way CISCO has empowered their line managers needs to be mentioned first in this regard. They have provided
them with HR tools, technologies, and online tools etc., which give them an edge over their counterparts in other
organizations. At the click of a button, a manager can look at the database of his / her own people, track history of
development, increments, promotions, stock options etc. They are also given the rating and ranking tools. They
could recommend changes and training needs and they could draw upon the resources available. Technology is
deployed in a very effective way.

Mind Tree Consulting

Once in three to four weeks, they call up their employees and give them information as to what is happening.
Whenever there is a project win or a customer delivery, they ring the bell in the company to inform everybody.

They have the CEO's snapshots which is released once in two weeks, the in-house magazine, meet the "Mind Tree
Minds" (the way they call their employees), where the computer selects some names at random and they meet the
senior people to get the right perspective of what they are doing, why they should do it, etc, and to make sure that
there is enough interaction. All these things enhance communication, security, sense of belonging and commitment
towards the organization.

Air Tel

They strongly believe in 'softer skills' such as working in teams, inter-personals skills, communication skills,
creative thinking, entrepreneurial skills etc.

I am not sure if they are unique, but they have a policy like 'HR Reach out'. Every HR member is assigned a
department. He / She works with the department very closely not only to proactively enable employees perform but
also to partner with the business and influence business processes and policies.

Few more would be the 'Customer Contact Programme'. Once a month, all senior managers reach out to customers
to get a first hand feel and feedback from them.

They conduct Employee Satisfaction Surveys, have departmental strategic matrices developed to work on employees
feedback, etc.

Birla 3M

They encourage Two-way communication. They have something called "Between Us". Once in six months, the MD
and the HR head go to all the branch offices. The MD talks about the business and request the people's involvement
in fulfilling the organization's dreams.

HR head talks about the new HR policies and then there is an open discussion. Employees can express themselves
on whatever issues they have with regard to work. If there are sensitive issues, which they don't want to discuss
openly, they can write and give those without their names. The question is read, and the answer given. The paper on
which the question is written, is destroyed then and there, to make sure that nobody tries to trace the handwriting of
the person or in any way recognize him/her.

Philips Software Center

The first one that needs to be mentioned is the dream project. Dream projects allow every employee to pursue a
project of their own interest in the technical area. They invest time while the company given them resources and
encouragement. The first one that needs to be mentioned is the dream project. Dream projects allow every
employee to pursue a project of their own interest in the technical area. They invest time while the company given
them resources and encouragement. However, the project has to help Philips in some way or the other. It has to be
relevant for what Philips is pursuing.

They also have a sponsorship program for higher studies. Their employees can join a Tech. program or an MS
program or even pursue a Ph.D. Company will fund them right up to 100% of the cost.

Once an employee completes 3 years with Philips Software, Bangalore, they will consider him/her for an
international assignment within Philips. Further any employee who completes 18 months experience can seek
transfer from within the company, from one technology to the other, one product division to another. They facilitate
such a job rotation systematically. In their cafeteria, they also provide a diet meal section to interested employees
and it is well appreciated.

They have well furnished bedrooms for those people who stay back late in office working.

Another brilliant concept practiced is the Philips Yellow pages. It is an internal network, which connects people
across all our offices worldwide. It is very easy for one to locate people who are known for particular domain
knowledge or a skill or talent. Any employee, who needs to learn about a subject, can get connected to the subject
expert through the yellow Pages.

Philips is probably one of the few organizations which have an offsite three-day Leadership program for all its
managers.

They remind their managers that they would be measured as much by their deliverables as by their practice of the
company values. These values are:

 Let us delight our customers

 Let us Value People as greatest resource
 Let us deliver Quality and Excellence in all our actions
 Let us achieve Premium return on equity
 Let us encourage entrepreneurial behavior at all levels

They have a community involvement team. The team is entirely manned by young professionals. A budget is given
and they decide how to use the money. There is no interference from any senior managers.

They also believe that charity begins at home. They have a green team, which monitors environmental related issues
so far as it relates to the organization. Young professionals are involved in this. Thus they ensure that
environmental concerns are not just spoken about but they actually do something about it. They follow a global
appraisal system, which totally involves the employee in the whole performance management process. Planning,
goal-setting, work review, coaching and developmental appraisal are part of this process chain

There is some compulsory training that every appraiser and the appraised go through before the appraisal. They
have one full day training program for managers who do the appraisal. It is mandatory. If the manager doesn't go
through it, the company holds the right to not let him do the appraisal. This training is not a once in a lifetime
affair. Every year before the appraisal, the training is given.

A half-day training is given to the appraised personnel to make them aware of the nitty gritties of the appraisal
program. They are reminded about the importance of doing home work, receiving and sending feedback and
reflecting on the feedback in the right way.

These sorts of training programs prepare people to see appraisals as development processes rather than as a
judgmental process.
They have plenty of reward programs. They closely watch people who contribute towards product quality, process
quality, internal trainers who train colleagues, people who bring best practices from outside and implement if here
and so on. They are rewarded and as you know rewards are inspiring and infectious.

Soon after a person joins their organization (within one, one and a half months), the HR managers are expected by
training, to sit with every new employee and start capturing what he or she likes best in the organization, they take
inputs about matters regarding say, if he or she has the power to change what would he or she change in the
organization and where do they think they can contribute a lot more than what is presently done and so on. This
feedback is carried to the management team of the organization and the employees are given the opportunity in
terms of their interest in technology and outside of technology, into more suitable platforms.

Wipro Technologies

Every four months they conduct an employee survey where all our employees provide inputs on the health of the
workplace. This survey enables us to identify how strongly the person feels about the organization, and how strong
is the person's clarity of his / her existence in the organization. It also enables us to see the person's own ability to
identify with the vision of the organization, and whether he thinks the organization listens to what he has to say. He
also reveals whether he feels that his supervisor takes interest in his/her development, has he / she received any
word of praise from the boss for a good job done and so on. This proves to be an eye opener for the managers as
well.

They have the HR review in the planning cycle, which is a rigorous process involving everyone, right upto the
head of the organization. They do succession planning for individuals wherein they identify the best talents - the top
ten people. They also identify our bottom ten people, who are asked to pull up their socks and improve, failing
which they will have to leave. They carry out this exercise every quarter and this enables us to be well informed
about our people asset.

They have a program, which is known as "wings within'- an internal job posting system. This works well, as our
people can apply for jobs in other departments and they do not have to inform their supervisors about it. If selected
they can move out and nobody can stop them. This gives people the feeling that they are not buttonholed into a
particular type of job.

Their CEO Mr. Azim Premji spends 3 to 4 hours with every new group of employees, briefing them about their
promises, values and beliefs.