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Executive summary Attrition is one of important problem the IT industries are facing now a days.

Thus, I have done research on this subject. The primary objective of this research is to study the attrition in IT industry. The secondary objective of this study is to know what are the reasons for the employees to leave their jobs, to evaluate how the employees are valued to the organization and to prove that the organization policies should be supportive to the staffs working there. I have used the Descriptive Research design for the research. Also, I have collected primary and secondary data to do this research. The sampling unit used is the IT industry, the sample size of the research is 20. I have used Questionnaire for collecting the data. Percentage Analysis and Chi square are the two statistical tools used for Analysis. The study reveals that the employees are leaving the organization because of the work stress and the company policies are supportive to the employees.

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INTRODUCTION: Attrition: A reduction in the number of employees through retirement, resignation or death. Employee turnover is an enormous problem for any company and creates negative bottom-line impacts. The costs associated with employee turnover show up in such areas as advertising for new employees and the time and money necessary to screen the applicants, training new employees, lost productivity, decreased accuracy and quality of work among the employees left behind who are upset about their colleagues departure, using expensive contract and temporary employees to do the work until a permanent employee is hired, and the expenses associated with replacing lost business. Employee turnover costs can amount to thousands of dollars, annually. It can also prevent companies from pursuing their growth opportunities and acquiring new business & Attrition rate is the rate of shrinkage in size or number Types of attrition: There are three types as follows: Market Driven based on the demand for a particular skill or ability in temporarily low supply (self-correcting in normal markets). The typical initial reaction by employers to market driven attrition is to increase wages, offer better benefits, escape the market by relocation or site migration or relax hiring standards. Workload or Stress Driven on the actual capacity to perform the work required. This is when there are not enough of the right people. Process Driven variables associated with job design and/or the organization. In some industries and organizations there is a belief that

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attrition has always been there and always will be there. Addressing this scenario produces the most lasting results.

Attrition Cycle & drivers Typically, in organizations experiencing systemic or chronic attrition, a cycle develops as: Attrition normally brings decreased productivity. People leave causing others to work harder. This contributes to more attrition, which contributes to increasing costs, lowe revenue. This often forces additional cost reductions and austerity measures on an organization. This in turn makes working more difficult, causing the best performers with the most external opportunities, to leave. There are two primary drivers of voluntary attrition. These are, no one likes to feel inadequate and, in most organizations, it is easier to leave than stay and try to alleviate the problem. People feel inadequate when communication is either incomplete or unreliable. Choices are either absent or insufficient. Often, the challenges in these situations are unclear, unsatisfying or overwhelming. People will give up trying to change things when promises are not specific, not kept or are not fulfilled in a timely manner. Additionally, when expectations are thwarted, changed arbitrarily or unfulfilled, people will lose motivation. Other common demotivators are when commitments are unacknowledged, vague or incompatible. Rarely do organizations create environments where employees can meaningfully participate in activities, which will reduce turnover. Attrition is commonly thought of as people terminating employment. Another form of classifying types of attrition are: 3 _______________________________________________________________________ _

Empty Chair Attrition: Employees quit and leave Warm Chair Attrition: Employees quit and stay.

In the best of worlds, employees would love their jobs, like their coworkers, work hard for their employers, get paid well for their work, have ample chances for advancement, and flexible schedules so they could attend to personal or family needs when necessary. And never leave. But then there's the real world. And in the real world, employees, do leave, either because they want more money, hate the working conditions, hate their coworkers, want a change, or because their spouse gets a dream job in another state. So, what does all that turnover cost? And what employees are likely to have the highest turnover? Who is likely to stay the longest? Defining Attrition: "A reduction in the number of employees through retirement, resignation or death" Defining Attrition rate: "the rate of shrinkage in size or number" Attrition is beginning to significantly affect offshore ROI. Just as businesses faced a scarcity of talented IT resources during the dotcom era, organizations in offshore countries such as India are experiencing similar pains. Skilled employees are hopping from job to job and taking with them the customer knowledge and technical expertise that any company needs. Their salaries are increasing, along with their perks, benefits, and bonuses. 4 _______________________________________________________________________ _

Defining the attrition problem


Global outsourcing and the astounding amount of foreign direct investment pouring into China, Russia, and India have created tremendous opportunities and competition for talented IT professionals in those countries. The downside of this increased competition is a rising rate of attrition, particularly in India. Fiscal third-quarter 2005 (ended December 2004) results filed by Infosys, Wipro, Satyam, and TCS listed attrition rates between 7.6% and 17.7%. Vendors that we have interviewed place the numbers much higher, at 25%60%, while an April 2005 BusinessWeek article estimated an attrition rate of 60%, with some India service providers experiencing up to 80% turnover. To put these attrition numbers into perspective, if a company has 100 programmers and an attrition rate of 25%, then 25 of its IT staff will leave each year. Think about the time and money it took to find, interview, hire, train, and coach those 25 people. Now think about losing them and starting the hiring and training processes anew. How do the hiring and training processes break down in terms of total costs in India? The typical time for advertising, interviewing, screening, negotiating, and hiring a new employee is about two weeks. 5 _______________________________________________________________________ _

Companies usually allot one week for programmers to become familiar with the new business, two more weeks for technical training, and one last week for customer training. Now imagine a 25% attrition rate and replacing 25 of these programmers each year. Based on a yearly salary of $15,000 for the human resource person and $25,000 for the programmer, it would cost an additional $63,000 annually in acquisition and employee training costs. After considering these figures, it quickly becomes apparent why companies are investing in strategies to prevent attrition.

Reasons for attrition


It is not easy to find out as to who contributes and who has the control on the attrition of employees. Various studies/survey conducted indicates that every one is contributing to the prevailing attrition. Attrition does not happen for one or two reasons. The way the industry is projected and speed at which the companies are expanding has a major part in attrition. For a moment if we look back, did we plan for the growth of this industry and answer will be no. The readiness in all aspects will ease the problems to some extent. In our country we start the industry and then develop the infrastructure. All the major IT companies have faced these realities. If you look within, the specific reasons for attrition are varied in nature and it is interesting to know why the people change jobs so quickly. Even today, the main reason for changing jobs is for higher salary and better benefits. But in call centers the reasons are many and it is also true that for funny reasons people change jobs. At the same time the attrition cannot be attributed to employees alone. Organizational matters: 6 _______________________________________________________________________ _

The employees always assess the management values, work culture, work practices and credibility of the organization. The Indian companies do have difficulties in getting the businesses and retain it for a long time. There are always ups and downs in the business. When there is no focus and in the absence of business plans, non-availability of the campaigns makes people to quickly move out of the organization.

Working environment:

Working environment is the most important cause of attrition. Employees expect very professional approach and international working environment. They expect very friendly and learning environment. It means bossism; rigid rules and stick approach will not suit the call center. Employees look for freedom, good treatment from the superiors, good encouragement, friendly approach from one and all, and good motivation. Job matters:

No doubt the jobs today bring lots of pressure and stress is high. The employees leave the job if there is too much pressure on performance or any work related pressure. It is quite common that employees are moved from one process to another. They take time to get adjusted with the new campaigns and few employees find it difficult to get adjusted and they leave immediately. Monotony sets in very quickly and this is one of the main reasons for attrition. Youngsters look jobs 7 _______________________________________________________________________ _

as being temporary and they quickly change the job once they get in to their own field. The other option is to move to such other process work where there is no pressure of sales and meeting service level agreements (SLA). The employees move out if there are strained relations with the superiors or with the subordinates or any slightest discontent.

Salary and other benefits:

Moving from one job to another for higher salary, better positions and better benefits are the most important reasons for attrition. The salary and offered from MNC companies in Bangalore, Delhi and Mumbai have gone up very high (Rs 15000 to Rs 18000 per month) and it is highly impossible for Indian companies to meet the expectation of the employees. The employees expect salary revision once in 4-6 months and if not they move to other organizations. Personal reasons:

The personal reasons are many and only few are visible to us. The foremost personal reasons are getting married or falling in love or change of place. The next important personal reason is going for higher education. Most of the BE, MCA and others appear for GATE

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examination or other examinations and once they get cleared they quickly move out. Health is another aspect, which contributes for attrition. Employees do get affected with health problems like sleep disturbances, indigestion, headache, throat infection and gynecological dysfunction for lady employees. Employees who have allergic problems and unable to cope with the AC hall etc will tend to get various other health problems and loose interest to work.

Poaching:

The demand for trained and competent manpower is very high. Poaching has become very common. The big companies target employees of small companies. The placement agencies have good days for doing more business. The employees with 4-6 months experience have very good confidence and dare to walk out and get a better job in a week's time. Most of the organizations have employee referral schemes and this makes people to spread message and refer the know candidates from the previous companies and earn too. Employees advocate: 9 _______________________________________________________________________ _

One of the main reasons why employees leave companies is because of problems with their managers. An HR professional can be termed an employees advocate and a bridge between top management and employees at all levels. There is a huge gap between HR professionals and employees in terms of understanding challenges and delivering requirements. HR has not really understood the problems associated with employees careers and jobs. The companys overall plans and strategies also depend on HR professionals as they voice employees problems and requirements. The HR department should have genuine interest in the employees welfareit is responsible for making sure that their expectations are met. By doing this it is easier to meet the companys business targets.

How Insights Can Help Build Strong Manager/Employee Relationships: The Insights Discovery System is based on perspectives and attitudes relevant to understanding organizational and cultural requirements and needs of people in relation to motivation and leadership. The understanding of individual differences that Insights provides is fundamental to improving communication, co-operation and building effective and high morale teams. This understanding is what bridges the gap between manager and employee. The Insights Discovery System generates reports that reveal personal preferences or triggers of each individual - including issues that cause stress. In essence, Insights can bring about a closer relationship 10 _______________________________________________________________________ _

between employee and manager to enable both parties to better adapt, connect and understand one another. An employee may be highly competent but his or her style may be different from that of the direct manager. The "Value to a Team" section of an Insights report provides crucial information to a manager who tends to evaluate all employees against one set of standards. Insights can help managers recognize the value and uniqueness of each person's contributions then reward them accordingly.

Insights also serve as a communication vehicle for discussions about an employee's current and future interests. Insights help managers and employees better identify what values (needs) are most important to each individual and how these values impact the person's attitude towards work. Values can range from an employee feeling stable and secure to someone enjoying challenge.

The Insights Discovery System is a powerful workforce enhancement tool. It can: - Enhance the effectiveness, commitment and retention of an incumbent behavior - Motivate and retain employees whose basic monetary and material needs drives - Improve HR planning and development - Identify motivational and managerial issues related to interpersonal style may have been satisfied, but who are seeking their internal workforce though increased understanding of human

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Reduce the impact of turbulence and organizational transition on

employee commitment and productivity.

How to save high attrition rates?


How much would you invest to keep your employees focused and happy?

This is the question on the minds of CEOs and managers worldwide as the technology boom lifts and the employment market opens.

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From the employer's perspective, employees are an investment. You interview to make sure an individual has good work ethic, motivation, and drive. Most of the time, employees are considered a financial investment. Yet there's much more to it than that. There is a significant emotional investment that is crucial to accelerating business strategies and reaching organizational goals. You probably know someone who owns an outdated, overused vehicle but won't entertain the thought of trading it in even though they can afford to upgrade. Why, you might ask, do they keep it? Well, the owner has probably invested substantial time, money and care into keeping it in top condition, not to mention the dependability that has taken them to countless doctors appointments, baseball practices and events. It seems senseless to throw it away. The cost of replacing the vehicle would be enormous compared to the cost of upkeep on the old one. Even with inanimate objects, we become accustomed to personality and quirks and develop a common trust. When this same logic is applied to employees, we find the cost of replacing employees comparable to that of investing in a new automobile. Recruitment, hiring, benefits and administrative costs put an organization upside down on the investment.

Thankfully, companies have come to realize that keeping employees is more cost-effective than replacing them. Retaining valuable employees has other benefits - retaining the vault of knowledge that's been accumulated, skills learned and trust and relationships they have built

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with

customers

and

co-workers.

People Are Not Easily Replaced Even though today's pool of unemployed workers is deep,

organizations choose to spend more time and resources on retaining existing employees than starting from scratch. Yes, there are financial reasons behind this focus on retention. However, there are many other contributing factors such as the effect attrition has on customer service, corporate culture and employee morale and loyalty. All these factors can and will be effected by turnover. Basically, when good people leave an organization they take their training and knowledge and often times, relationships with them. Drivers of Turnover Turnover is often driven by corporate restructuring and tight

competition for key talent. For many firms, surprise employee departures can have a significant effect on the execution of business plans and may eventually cause a parallel decline in productivity. This phenomenon is especially true in light of current economic uncertainty and following corporate downsizing when the impact of losing critical employees increases exponentially.

When managers or supervisors are asked why good people leave, most respond, "Its about money." Or, they dismiss the departure matter-of14 _______________________________________________________________________ _

factly by stating the employee "received a better offer." Contrary to popular belief, research indicates that money is not even on the list of top five reasons employees give when asked why they are leaving an organization. When viewed from the employees' perspective, a healthy organization is one in which people are generally satisfied with the quality of their work life. On most days they feel good about going to work. They feel empowered to help shape decisions that affect them, they have the resources and skills to satisfy customer needs and they are generally confident in the abilities of the leadership team. From the organization's perspective, the organization is healthy if it is viable as measured by profitability, competitive market position and customer satisfaction. A healthy organization also responds well to the need for change; it is adaptive and thereby ensures its future meaning that following a major upheaval or transition, the healthy organization rebounds and employees remain committed. Bottom line, it is the role of the manager, that most influences an employee's decision to stay or depart from an organization. People will leave if they don't like their manager - even when they are well paid, receive recognition and have a chance to learn and grow. In fact, disliking or not respecting the boss is the primary reason for talent loss.

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Research shows the reasons for employee departures are: 1. Employee/manager relationship 2. Inability to use core skills 3. Not able to impact the organization's goals, mission 4. Frequent reorganizations; lack of control over career 5. Inability to grow and develop 6. Employee/organization values misalignment 7. Lack of resources to do the job 8. Unclear expectations 9. Lack of flexibility; no 'whole life balance' 10. Salary/benefits

It is very important to know that the above factors are often NOT the ones mentioned in most attrition studies published by individual organizations. Additionally, this information does not match the data frequently obtained during an employee's exit interview when asked about the reasons for departing. The rationale behind this discrepancy is that exit interviews are frequently conducted by the departing employee's manager or HR manager, hindering honest responses. Typically, reference. employees are hesitant to tell these company representatives the truth for fear of burning bridges or getting a bad

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How to curb attrition?


Money is not everything Although the importance of higher packages is slowly diminishing, among fresher or laterals with less than three years of work experience, money is still considered to be the highest priority. Employees want not only work recognition, but also extra perks." A number of professionals are looking at more challenging jobs. "In several cases, faced with a choice between more money and a challenging job, employees have opted for the latter as it allows them to learn new technology and increase domain expertise." People analyze the training programmes of prospective companies with those of their current organization, which means that how an organization grooms an employee is weighed to a greater extent. This is because they know that developing next-level skills will keep them ahead in the job market, and finally result in better compensation. They also look for a job with higher levels of responsibility, better learning opportunities. Vision and objectives The next level of communication, a crucial part of retention, starts with acquainting employees with the companys vision and objectives. and Organizations successful in retaining employees clearly employees, especially new is a entrants, must. about the pass on their goals and achievements. Conducting regular meetings updating companys status and achievements They should

concentrate on leadership and brand building as people prefer to be associated with a brand. Respect for the job should be created by 17 _______________________________________________________________________ _

BPOs. The youth should feel proud to be a part of the billion-dollar industry.

Mentoring and handholding new recruits from day one to four months are important tasks; during this period, they should be familiarized with the culture of the company. It is at this time that new entrants experiment with different options. Hence they should be exposed to the best values the company has. If they are informed about regular happenings in the company, employees will be confident about the future and not try to look for better options. Treat employees like Customers

Even while companies strive to understand which organizational, job, and reward factors will contribute to holding back employees, industry experts have found several loopholes at the top management and HR management level. Companies should have a similar approach to employees and customers. If a company strives to retain an employee in the same way it tries to retain a customer, him leaving the organization could be out of question. Since software professionals have different priorities at different points of time, organizations need to structure their offer-mix while recruiting new hires, as well as promoting potential ones. Communication is the foundation for the entire process of managing attrition. This communication begins right from recruitment. In cases of peer pressure, an employee aims to join a well-known company. This could be achieved by brand building, which attracts the right talent and helps in retention as well. 18 _______________________________________________________________________ _

Understanding

an

employees

needs

at

various

levels

is

recommended HR practice.

Firing

Sometimes, firing can look like attrition. Looking at firing and attrition together in a different light, firing can be an excellent tool to contain attrition. Attrition can simply be defined as employee leaving his current job due to reasons like, job pressure, health problems, personal reasons, inefficient boss, lack of job security etc. All the above reasons are interlinked and can be the reasons for good workers to quit. If the team has under-performers who despite given sufficient support and training is unable to perform, but they continue to be part of the team damage the morale of the team. A performer will not want to be part of the team, which has non-performers because he will have to compensate for the non-performer, thereby increasing his job output/pressure. A continuous job pressure results in health problems. Having frequent health problems not only reduces his performance, but also affects him financially. At this juncture, the performer realizes that he is working with an inefficient manager who is not capable of cleaning up the team by firing non-performers. With the above, the performer employee feels insecure and resigns. Firing non-performers can be an efficient tool to contain attrition. Consider feedback

It is important to take feedback from employees through different means and work with the HR department to iron out differences. As 19 _______________________________________________________________________ _

industry experts point out, feedback can be got in two waysduring the employees tenure, and through exit interviews. Inputs can be secured from existing employees through various employee relationship management tools. The Wipro Listens and Responds initiative at Wipro aims to capture the concerns and grievances of its employees. The feedback we get through this tool will be analyzed, and action will be taken on it. Our employees are very excited that their feedback is being taken seriously, says Sahoo. Exit interviews help management learn the reasons why employees leave the company; based on their revelations, the organization can address the problems of existing employees, thereby curb attrition. Spend Time Developing and Benchmarking Incentives

Whenever the demand for a professional in a particular field heats up, the perks associated with the job start to pile up. Standard perks for an India-based "fresher" (a new entrant in the IT services industry with little work experience) typically include free transportation, educational assistance, healthcare benefits, performance-based bonuses, onsite cafeteria, stock options, and interest-free loans to absorb the cost of relocation or maybe to finance the purchase of a two-wheeler. According to Wipro's web site, its employees even have access to an agency that will handle such "domestic chores" as paying bills, thereby giving IT workers more free time. An important part of designing incentives is aligning them with market benchmarks. As far as salaries, HR firm Hewitt Associates reports that India showed the largest overall salary increase in the Asia-Pacific region in 2004. Salaries in India grew by 11.6% overall, while China 20 _______________________________________________________________________ _

trailed with a 6.4%8.4% hike, the Philippines showed a 7.4%7.7% increase, and Korea saw wages jump by 6.4%6.8%. Salary increases for middle managers in India were even more dramatic: Nasscom, India's software association found that salaries for middle managers rose by as much as 30% in the last two years. These salaries are often paired with expansive benefit packages that include standard entrylevel benefits as well as special services such as help finding and buying a home or enrolling children in school. Captive centers and IT service providers have to offer innovative compensation and benefitsor risk losing valued employees to competitors. Nonstop evaluation and benchmarking are "need to do" activities for IT managers. Subsidize Education and Certification

In the United States, many companies reimburse employees for advanced degrees or certifications that relate to their area of expertise. Until recently, the opposite was true in India, but that trend has begun to change as businesses have discovered that a significant portion of their attrition problems stem from employees leaving to pursue a master's degree. Several offshore service providers have teamed with universities to offer their workers management-level master's courses at a subsidized rate, and watched attrition rates drop as a result. For example, Cognizant Technology Solutions, an IT service firm with 17,000 employees, partially reimburses Indian staff that pursues master's degrees at BITS, a higher-education institution located in Pilani, India. Business process outsourcing (BPO) player 24/7 Customer, 21 _______________________________________________________________________ _

in association with the Indian Institute of Management Bangalore, launched a management-education seminar series called "Beyond Knowledge," through which 24/7 aims to educate employees about the BPO industry and discuss related careers. Multiple providers have followed the lead of Cognizant and 24/7. In several offshore countries, advanced degrees are considered crucial to social standing. It's important for U.S. firms with little international experience to recognize this desire among employees and design programs accordingly. Change Locations

The high prices and resource crunch in top-tier Indian cities such as Bangalore and Mumbai have led many companies to execute alternative location strategies. Many vendors are sending work to tiertwo cities (Hyderabad or Chennai) or even tier-three cities (Noida or Chandigarh), where labor and real estate costs as well as attrition may be cut in half. Such benefits come at a price: The infrastructure quality lags that of more advanced cities, and the search to find qualified people may take longer. Another option to combat the rising attrition rates in India is to locate in other countries. Sykes Enterprises, for example, disclosed that it is relocating the customer contact management work at its Bangalore, India, facility because the center delivered an inadequate return and a limited competitive advantage. The Tampa-based company thinks the work is better suited for the other Asia-Pacific offshore centers in its portfolio, such as China. Sykes expected to incur total charges of approximately $0.8$1.5 million for its plan to relocate work. 22 _______________________________________________________________________ _

Rotate Employees

Employees who don't feel challenged by their work often leave. In response, companies such as TCS have programs that rotate employees into different disciplines about every two years and expose them to new locations, projects, and technologies. L&T InfoTech, a software solutions provider with 4,000 employees and six development centers in India, has implemented a similar program. Offshore employees are asking for a clear career path with increased responsibility and frequent recognition of achievement. Established U.S. and European multinational companies have long had learning programs that set expectations for performance goals such as learning a particular tool or proprietary software. Companies practicing off shoring need to provide new challenges and opportunities for skills development through training or job rotation. It may become the only reason your best employees stay with you. Combat Poaching by Encouraging Referrals

Rather than going through a prolonged posting process and screening a deluge of rsums, some companies poach employees directly from their competitors and offer to double salaries or buy out contracts on the spot to scale up quickly. Poaching is generally a bad idea, as it drives up salaries and discourages employee loyalty. An employee referral program can serve as an alternative and effective recruiting strategy. Satisfied employees can be a company's best sales tool and add a personal touch that a print or radio campaign 23 _______________________________________________________________________ _

lacks. A Voice & Data survey of the top 15 Indian outsourcing companies with 1,000-plus employees found that referrals constituted 23% of new hires. For some companies, the number was even higher, at 40%. The study also observed that recruits hired through employee referral programs are "stickier"; that is, they stay with companies longer than non-referrals.

Just Ask: Are Your Employees Satisfied?

Retention is inextricably linked to employee satisfaction, so it pays to periodically survey employees hopefully before their exit interviews about job satisfaction issues, and act on the data gathered. The aim is to determine why some employees depart and some remain with the company, and to define the traits of productive, successful employees. Many companies examine the reasons employees leave, which don't reveal as much as the reasons they stay. An important aspect of implementing a retention program understands that it should not be one-size-fits-all. If incentives are meant to keep employees happy, then they truly have to be designed with the employee in mind. Too often, employers and employees disagree on what constitutes a good incentive. For example, a company might reward a father with three young children a monetary bonus as thanks for working overtime for five months straight. To the father, however,

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days off might have been more attractive, since they would have allowed him to spend time with his family. Knowing your employees and personalizing rewards makes a

difference. The global workforce has different, individualized needs, and organizations should tailor incentives for their employees if they want to retain them. If your company doesn't bother, don't be surprised if workers head for the door as soon as year-end bonuses are handed out or stock options vest.

Spend More Time Recruiting

With huge projects ramping up within exceedingly short windows, it can be hard to convince management to allot more time to the recruiting process. However, it's difficult to retain good employees if the company doesn't have a process to hire the right people in the first place. Simple measures, such as incorporating skills tests that relate directly to the job in question, can help companies to determine whether the applicant is indeed an expert programmer or merely an intermediate programmer. Having employees interview candidates also may increase the chances of success, as these employees can better identify potential personality clashes that HR personnel may not spot.

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Costs of Turnover
The impact of employee turnover on company performance is often understated by organizations. This describes how the cost of turnover is can be calculated using some basic organizational parameters. The purpose of this document is to provide talent cost of turnover calculator with insight into how costs are calculated and the reasons why certain costs were include or excluded form the calculator. The calculator should only be used as a guide in understanding the impact of turnover on a company. If the desire is to understand the true cost of turnover then it is suggested that a greater degree of analytical work is undertaken. The key areas used in the calculation of turnover are: Administration and sourcing costs

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These include the administration of the termination and recruitment functions together with the costs associated with interviewing, testing and attracting applicants. New Hire costs

Once a person has been employed an organization generally spends significant resources in the induction and administration of bringing them into the organization.

Lost productivity

The hidden costs associated with lost productivity of employees prior to leaving the organization and new less skilled employees are one the largest components of the total cost associated with turnover. Dysfunctional and avoidable turnover

Determining the level of dysfunctional and avoidable attrition provides a perspective on the scope of control that a company has to manage their turnover costs. Determining the cost of turnover is the first step in the process of developing a management plan. To deal with an attrition issue effectively the reasons for turnover and an understanding of the demographics of turnover need to be understood. 27 _______________________________________________________________________ _

Undoubtedly, the financial costs of turnover have attracted the attention of academics and practitioners alike. Besides the more familiar costs associated with the administration of terminated employees the economic costs such as productivity losses need to be included in any calculation. In particular, departure of employees especially experienced or talented ones - may threaten overall firm productivity or client retention. Furthermore, personnel losses may endanger the firms future opportunities in the marketplace or the morale of their remaining work force. Human resource accounting experts Cascio, Hom and Griffeth define exit expenses as having two main components - direct and indirect costs.

A company incurs both direct and indirect costs that result in losses in production dollars and overall production volume, as well as increased administrative costs. Direct Costs are actual dollars spent each time an employer has to attract, select, and induct a replacement for an employee who leaves the organization. Indirect costs are those expenditures attributable to turnovers affects on production - that is costs for incomplete or disrupted work, loss of quality, etc. The cost of turnover can be calculated by measuring the time taken to administer each activity plus the direct costs such as advertising costs. The turnover costs calculated using the calculator represent dollars spent. The potential loss of revenue if these dollars were invested elsewhere or through lost productivity is not calculated. Therefore, the

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figures are an indication of the minimum costs that the organization is subjected to when an individual leaves the company.

Administration & Sourcing costs

The most visible cost of turnover is incurred by organizations in the area of recruitment administration and sourcing. The time associated with processing terminated employees and recruits places a burden on organizations where staff turnover is excessively high. The assumption is that this is largely an administrative task conducted by people at 80% of the average company salary. In addition the direct costs to a company for recruitment agency and advertising costs are highly transparent. 1. Process Administration: Resignation Administration 29 _______________________________________________________________________ _

The time taken to administer a resignation will include activities such as: conducting exit interviews & processing of administrative tasks. The time taken to perform these activities is ideally measured as a result of analyzing the processes involved. 2. Recruitment Administration A large amount of time is often spent in administering the recruitment process. Writing the job ad, posting it onto job boards, organizing agencies and reference checking all require the use of organizational resources, whether internal staff or outsourced. The hours spent involved in these activities does need to be factored into the cost of turnover. 3. Sourcing Costs: The cost of sourcing a successful applicant from an agency may be one of the largest single direct costs associated with recruitment.

4. Advertising costs The cost associated with posting job ads to job boards or traditional media such as newspapers can be significant. The average cost per vacancies is used within the calculation. 5. Interview Costs: Interview A core component of recruitment administration is the cost associated with interviewing applicants. Interviews make use internal resources. The more interviews held and the greater the

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number of candidates interviewed the larger the costs associated with these activities. Testing Companies are making greater use of psychometric and aptitude testing in their recruitment processes. These tests can be costly to administer and as such need to be factored into the overall attrition costs.

Travel Companies may pay the costs associated with bringing an applicant to the interview location. Although this may not be done for every candidate an average is used in the I4 calculator.

Cost of New Hire

The two costs measured in this area are the administrative tasks associated with inducting a new hire into the organization and the associated induction training. When measuring the cost of attrition sometimes the total cost of training that an individual has received whilst in the employment of an organization is included. However, as all learning undertaken by employees will be used back on the job an 31 _______________________________________________________________________ _

add value to the business it is inappropriate to count it as a cost of attrition. Also, where particular jobs have high training, often there is a corresponding lower rate of pay which acknowledges the investment that the organization is making in the individual, eg. Youth wages. One aspect of training directly associated with turnover, however, is the induction of new staff to the organization. High staff turnover will necessitate greater levels of resources being made available to induct new employees. It is the opportunity costs of these resources that must also be calculated.

1. Induction Administration The process of induction into an organization can involve a substantial amount of time. The activities included here would include the processing of new hires into organization systems (HR) and introductions to fellow employees.

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Induction Fixed Costs The fixed costs associated with inductions include the cost of materials such as induction kits and staff manuals.

Induction Training Any initial training received by an employee on joining the company. This includes the costs of the materials, presenters and the opportunity costs associated with the new employee taking time off work to participate. Relocation Expenses Similar to travel these cost are incurred by companies in an effort to source the best talent for alternate locations. An average cost needs to be captured as part of the calculation process.

Productivity Losses

The most detrimental aspect of staff turnover is lost productivity. Evidence has found that leavers often miss work or are tardy before they depart. Deery and Iverson argue that according to progression-of-

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withdrawal models the productivity of leavers may deteriorate before they depart. Turnover is commonly viewed as belonging to a family of withdrawal behaviors that physically distance employees from unpleasant work settings. Serving a common psychology function, withdrawal actions reduce the time spent in an adverse environment and thus reduce job dissatisfaction. Studies have shown that employees leaving a company will have a greater level of absenteeism prior to leaving. Excessive sick leave is not only costly, but is also an early warning signal that an individual may be considering resigning from the organization. Not only does staff take more sick leave but Hom and Griffeth state that their overall productivity decreases as well. Furthermore, resignations may disrupt other employees work if their work depends on the leavers or they must assume the leavers duties. The second effect of loss of productivity occurs when new hires join the organization. They will not have the networks, understanding of organizational processes or product/service knowledge to be effective. Studies have shown that a new hire will generally take between 3- 8 months to become effective in their new role. The longer period is associated with more senior roles.

Excluded costs

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Not all the costs associated with turnover have been included in the i4 attrition calculator. Costs that cannot be accurately measured or assumed have been excluded. These costs, although hidden, may be the most critical in terms of organizational impact. Examples of hidden costs are included below to highlight the organizational impact of attrition. Employee Demoralization

Turnover may erode the morale and stability of those who remain employed. Their morale suffers because they lose friends and may interpret motives for quitting as social criticisms about the job. A belief that a leaver has a better job elsewhere may change employees perceptions of their jobs. As a result stayers may denigrate their present position in the light of superior alternatives and begin contemplating other employment. This phenomenon may lead to a cycle of attrition whereby employees leaving a company prompt other to do the same. Impaired Quality of Service

Turnover also hinders the delivery of service and retention of customers. Attrition among service personnel impairs customer service because understaffed branches delay or withhold service. Unlike experienced leavers, new employees may also provide less competent or less personalized service because they do not know the clients and cant meet customer expectations through lack of knowledge and experience.

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If satisfied employees make customers feel well treated, disgruntled employees may provide careless service before they leave. Turnover also interrupts the transmission of service values and norms, which are the essential underpinnings of high quality service, to successive generations of employees. Customers' perceptions, attitudes and intentions seem to be affected by what employees experience, both in their specific role of service employees and their more general role of organizational employees. It has been found that there is a high correlation between employee turnover and customer turnover. Therefore, the cost of decreased customer satisfaction and loyalty should be taken into account when considering staff turnover. Turnover reason & cost impact

Just as attrition can lower productivity, incur financial costs, and undermine stayers' morale, turnover can have the opposite ramifications under certain circumstances or for certain firms. That is that the exit of marginal performers may improve overall firm productivity, while new replacements for leavers can obviously costly, personnel shrinkage especially infuse among companies with new ideas and technology. Though turnover is administrative staff - can nonetheless reduce overhead costs. Further

resignations may create more job and empowerment opportunities for employees who remain in firms.

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Functional and Dysfunctional Turnover

Departing from conventional beliefs, some academics point out that turnover can prevent stagnation and complacency, facilitate change and innovation, and displace poor performers. Turnover is not inherently negative. Although it creates personnel costs, the organizational consequences of turnover are dependent on who leaves and who stays. The departure of good performers is construed as dysfunctional turnover - representing a loss to the organization - for their replacements are likely to be of lower caliber. The departure of poor performers is viewed as functional turnover - because they are apt to be replaced by better performers. Research into whether high performers or low performers leave tends to have found mixed results. A meta-analysis conducted by McEvoy and Cascio found that generally it is the poor performers that will leave their place of work. There are two possible explanations for this: firstly, terminated staff has on average a lower tenure than current staff and so have not had the time or opportunity to develop the skills necessary to perform well; or the current performance management systems which exist are encouraging high performers to stay and poor performers to quit.

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Avoidable and Unavoidable

Further differentiation should occur between organizationally avoidable turnover and organizationally unavoidable turnover. For example, organizations cannot control (that is, it is unavoidable) turnover caused by an employees death, or by an employees quitting to follow a relocating spouse. It is important to identify carefully those exits that are avoidable and those that are unavoidable. After all, leavers whose departures are unavoidable resemble stayers more than they resemble the leavers whose departure is avoidable; they do not resign because they are unhappy with their jobs or the organization. Despite the appeal, determining whether exits are avoidable or unavoidable may prove difficult because employees may falsify reports of their reasons for leaving, they may not wish to burn their bridges behind them. The cost of attrition is only calculated on the level of avoidable turnover. There is no benefit in including the cost of unavoidable turnover since a company has no control over these events and can therefore not put in place action plans to minimize the negative consequences of staff turnover.

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Software firms R&D centers in India facing doubledigit attrition rates


Research and development centers at Yahoo Inc., Microsoft Corp., Adobe Systems Inc. and other multinational software product firms are facing a slowdown in growth and product development work in India as they battle double-digit attrition rates with key personnel quitting to join start-ups or launch their own ventures. Headhunters specializing in talent for large software product firms in India, executives at emerging start-ups and entrepreneurs said attrition rates are set to touch 20-25% annually, making it difficult for such product makers to hire and retain top talent. They are losing people to start-ups. And why is that happening? In the MNC captives, peoples careers are stagnating and many people are saying, Look Ive built this product, Ive gone through five product cycles. Why not go through a product cycle at a smaller company because I can get better value out of that?, said Sharad Sharma, chairman of the Nasscom Product on technology start-ups. Take, for example, 30-year-old software architect Mohammad Aamir, who recently quit his job at Adobe to join an enterprise mobility startup Bitzer Mobile Inc. After six years of working on a single product at Adobe, Aamir felt he had reached a saturation point and needed to work on newer products. 39 _______________________________________________________________________ _ Forum and entrepreneur-inresidence at Canaan Partners, a US-based venture capital firm focused

In a big company like Adobe or Microsoft when you work on a product, you end up working in big teams, where you often tend to get sidelined and your presence is not noticed. You dont have the level of exposure or responsibility that you get at a start-up, said Aamir. At my new workplace, Im involved not only in technical management, but also people management and business development. Im at the top level of the picture. Also, the entrepreneurial environment is becoming increasingly conducive to start-ups in India, with more angel investors and venture capitalists willing to throw their weight behind innovative ventures. Even though average attrition rates for the countrys R&D industry have not increased, the levels havent dropped either, experts said. Indias R&D industry accounts for 200,000-300,000 engineers working in more than 700 multinational firms, according to technology advisory firm Zinnov Management Consulting Pvt. Ltd. With the number of offshoring jobs coming into the country not that high right now, attrition should have ideally slowed down. But that has not happened, said Anshuman Das, co-founder and chief operating officer of CareerNet Consulting, a company that recruits engineers for product development centers at MNCs. Thanks to so much entrepreneurship happening out here, attrition rates are still kind of similar, which is 15-25% range, that I still see happening. Another reason for the stagnation in growth is that India doesnt figure high on the value chain, with many of the MNCs centres in India contributing only 2-3% to their overall global revenue. Also, many MNCs have reached the maximum level on the amount of R&D work they can send to India, which is 30-40% of their overall R&D activity, said Sharma. Will it be 60% tomorrow or 80% tomorrow? Its very, very unlikely. They logically cant offshore more than 40% of their R&D... Theyre 40 _______________________________________________________________________ _

building a product that the company is selling to the market, so it is core to the market and, therefore, theres a limit to how much they can offshore and that limit is being reached, Sharma said. Also, with some of these technology changes that have taken place, cloud-like changes, the team sizes of products have shrunk.

Incidentally, Sharma, who quit Yahoo in 2009 after two years as its research head in India to join Canaan, helped form a separate forum for product companies last month called the Indian Software Product Industry Round Table, or iSpirt. According to industry executives, even if a products team becomes smaller, the co-ordination costs remain the same. Google and Adobe did not respond to requests for comment. Yahoo India R&D did not comment on the attrition figures, but its vice president and CEO Shouvick Mukherjee said in an email, We have seen a reverse trend in recent years where a lot of folks working for us in the US have been coming back to India to work at our Bangalore centre... Even people who left Yahoo to join start-ups have chosen to return for a second innings... Microsoft did not provide a break-up of attrition levels for the last two years but said in an email response that the average attrition rate at their India R&D center was 7% for the last five years. Flipkart Online Services, the countrys largest online retailer, has been one of the beneficiaries of the exodus from multinational tech firms. Experienced technologists from MNCs are attracted to us because it gives them the chance to own and build solutions and do it on a large scaleand we have seen senior talent from established product companies joining us in large numbers over the last couple of years, Flipkart chief people officer Aparna Ballakur said in an email response. 41 _______________________________________________________________________ _

Some experts say multinational firms are learning to do more work with fewer people. Most of these GICs (global in-house or R&D centres) are trying to add more value to the job, with the headcount not growing as much as the revenue growth is. Theyre doing more work with less people, said K.S. Viswanathan, vice president of industry initiatives at industry lobby National Association of Software and Services Companies, or Nasscom. Also, India has not lived up to the hype of being a hub for innovation something that was widely projected after the dotcom boom in the mid-2000s. Most of these MNCs are not launching their new and upcoming products in India. So, as a result of that, a lot of new products are not happening in India and its mostly the sunset products which are happening in India, and hence the kind of work you end up doing is not something that you feel does justice to your competency, said Das. A Zinnov study issued last week seems to support that theory. The study, conducted among 100 multinationals with an R&D presence in India, revealed that only 26% have global roles based in the country despite over 40% of the headcount being located here.

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Attrition in India to top world charts in 2013; one in four employees to change jobs
One in four employees in the organised sector in India is set to switch jobs, the highest attrition rate globally, according to a Hay Group study. The series of fresh investments planned across sectors could raise demand for talent even as economic conditions remain tepid, raising concerns on employee engagement and retention. We are in the eye of an employee turnover storm. Organisations in India must give serious thought to what drives employee commitment," says Mohinish Sinha, leadership and talent practice leader, Hay Group India. Firms need to focus on employees with mission-critical skills, as well as high-potentials and those holding crucial roles, he adds. Employee turnover is predicted to rise to 26.9% in 2013 with an employee base of Rs 3 crore compared with 26% in 2010 on an employee base of Rs 2.8 crore, according to the study, 'Preparing for Take-Off', conducted in association with the Centre for Economics and Business Research. It covered 700 million employees in 19 countries. Worldwide, attrition is predicted at 21.2% in 2013 on an employee base of Rs 71.6 crore compared with 20.3% in 2010 on an employee base of Rs 64.4 crore. The number of workers expected to take flight 43 _______________________________________________________________________ _

will reach Rs 161.7 million in 2014 - a 12.9% increase compared with 2012 - as growth builds and employment opportunities increase, according to the study. Comparatively, turnover was minimal between 2010 and 2012. In the next five years, 49 million employees will leave their employers globally.

The figure is indicative, and helps to understand the employee mindset. It could help companies figure out why their employees are thinking in such a direction," says Sinha. In India, sectors like infrastructure and banking - where new players are entering the field - will continue to suck in talent. In infrastructure, nearly $1 trillion of investment has been planned in the years to 2018. With half of this expected from private financing, there will be huge 44 _______________________________________________________________________ _

demand for labour in India's finance, insurance, real estate and construction sectors - totalling 14% of employment in the organised sector - and raising turnover in these activities, as Sinha points out. Besides, there is a huge demand for ready talent, he says. But not everyone thinks it is a function of external growth conditions. "The best insurance against attrition is not to hope for lack of opportunities outside but to build strong internal conditions which act like a glue to employees," says Divakar Kaza, president, HR, Lupin Pharma. The study seems to support this. Nearly 55% of Indian employees expressed concerns about the fairness of their compensation and the extent to which benefits meet their needs (48%). One in every three employees expressed concern over a lack confidence in being able to achieve their career objectives with their current employers (37%); as a result, they are concerned about opportunities for learning and development (39%) and supervisory coaching for their development (36%). An analysis of Hay Group's employee opinion database, covering 5.5 m employees worldwide, threw up the most consistent predictors of employee engagement and commitment: confidence in leadership; an opportunity for career development; autonomy; supportive work environment; and appropA significant number of Indian employees have expressed concern over their firms' ability to provide the five retention factors - especially when it comes to the opportunity for career development, says Hay Group's Sinha. "Organisations need to give serious thought to how they stack up against these factors now before the job markets begin to improve. Those who don't are likely to find employees exiting in increasing numbers as more opportunities become available," he says.

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However, not everyone is buying the study's findings. "I am surprised to know we will see this kind of employee turnover in India because the GDP has declined to 5% and employees have till now stuck to their companies due to job security issues and the lack of new opportunities. The turnover might be voluntary," says Adil Malia, group president, HR, Essar Group. Worldwide, average employee turnover rates over the next five years are predicted to rise to 23.4% and the number of global departures in 2018 is expected to be at 192 million. Turnover rates are forecast to be higher where market prospects are better - so employees in emerging markets will continue to have opportunities and be among the first to take flight. riate compensation. Attrition rate falls down to 15-20% in IT-BPO sector:

ASSOCHAM The apex industry body, the Associated Chambers of Commerce and Industry of India (ASSOCHAM), has reported that the attrition rate in ITBPO sector had fallen drastically. According to the body, the level of attrition has come down to 15-20% in the last six months for the year 2012 when compared to the 55-60% attrition rate in same period during the year 2011. As per the recent survey carried out by the apex body, the level of attrition rate has been falling by 45-50% from period of January to June mainly due to the downturn in the global economy. According to the report, slow growth of the economy coupled with weakening rupee against dollar has made the employees in the BPO sector to adopt a wait and watch policy before moving out from the current job position. Nevertheless, this policy adopted by the employees proved to be a

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boon for the IT/ITES as the sector has been grappling due to talent shortage in the middle and senior level management. The industry body as part of their survey interacted with consultants, HR professionals, psychologists and managerial officials of various companies from six leading centers of IT-BPO sector in India. Many of the respondents gave economic slump as the reason for the slowing down of hiring activities and increasing retention rate at all levels of management in BPO companies. They further said that the slowdown has been also forcing the other companies to consider only a mere hike in the annual appraisal season which doesnt have much incentive to employees looking to jump from current jobs.

Most often, attrition in the IT-BPO sector happens mainly in quest of


High pay packages Better career opportunities and growth prospect Better management relationship and Avoid performance pressure.

But, according to the survey, decline in attrition rate will prove to be fruitful for the companies which are struggling as expenses incurred on recruiting new staff and training them on the skills sets has fallen considerably. According to ASSOCHAM, the fall in attrition rate is beneficial as frequent change in the job can be fatal for the growth of the BPO sector in India. The report claims that high attrition rate affects both the companies that pay high pay packages and for the individuals receiving those high pay since high pays do not raise the level of skills and talents of the individuals. 47 _______________________________________________________________________ _

Further the report also discusses that the attrition rate is maximum among the entry level employees due to their aspiration for hefty pay packages, whereas the rate is minimum i.e less than 5% for the employees having work experience for more than10 years. The rate of attrition is 7-10% among the employees having experience between 510 years. However, according to the report, the companies are planning for salary hikes and promotions to keep a check on the attrition rate and to further lower the current rate.

OBJECTIVE OF THE RESEARCH : Primary Objective: A Study on attrition in IT industry Secondary Objective: To know the major reasons for employees to leave their jobs. To evaluate how an employee is valued as a part of this office. To study whether the promoting respect and fair treatment among all staff is a high priority of this office. To find whether the communication between staff and management is effective. To study whether the workload in this office is distributed equitably.

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To evaluate whether the employee know exactly what is expected of him/her as an employee.

RESEARCH METHODOLOGY Research methodology is a science of studying how research is done scientifically. Methodology helps to understand not only the products of scientific inquiry but the process itself. Aims to describe and analyse methods, throw light on their limitations and resources, clarify their presuppositions and consequences. Research Design: This research is of descriptive. In descriptive research, we have sufficient data on the concept and research material. Because many research have been done on the same concept. Therefore, nothing new is in this concept while I am going to study. I have used questionnaire method for collecting data. Sources of data: The data used in this research involves both primary and secondary. Primary data: Primary data are directly collected from the original sources. The primary data is collected in the form of responses from the employees using survey method. Secondary data: Secondary data is the data that has already been collected by someone else for a different purpose of yours. Sampling Techniques: Sample Unit: The sampling unit is IT industry, Mumbai Sample size: My sample size is 20. Tools used for data collection: Questionnaire: 49 _______________________________________________________________________ _

A questionnaire is sent to the person concerned with request to answer the question and return the questionnaire. A questionnaire consists of a number of question printed or typed in a definite order on a form. The respondents have to answer the question on their own. I have used like scale which consists of 10 question and respondents have to answer for the questions asked. Tools used for Analysis: Statistical tool: Percentage Analysis: Percentage analysis is the method to represent raw streams of data as a percentage for better understanding of data collected. Chi-square Test: The measure of chi-square enables us to find out the degree of discrepancy between observed frequencies and theoretical frequencies is due to error of sampling or due to chance. ANALYSIS: Survey research was conducted for the collection of data from a representative sample of Mumbai employees in IT industry. The data collected have been analysed. The age-wise classification of the respondents is depicted in the table. Age wise Percentage Below 22 [45%] 22 24 [20%] 25 27 [15%] 28 30 [10%] Above 30 [10%] No. of respondents 9 4 3 2 2

Interference:

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From the above table, it is interfered that 45% of the respondents are of age below 22, 10 % of the respondents are of age group 28 30 and above 30.

The table showing whether the office has policies that are supportive to its staff. Opinion Percentage Strongly agree Agree Neutral Disagree Strongly disagree [15%] [20%] [30%] [10%] [25%] No. of respondents 3 4 6 2 5

TESTING OF HYPOTHESIS The hypothesis assumed in the study has been tested with help of chisquare test. The formula used is X2 = (O-E)2/E Age the responde nt Below 22 22 24 25 27 28 30 of The office has policies that are supportive to its staff Strongl Agree Neither y Agree 1 1 1 2 1 Agree Disagree 3 2 1 1 3 1 1 Strongly Disagree NorDisagree

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Above 30 1

The expected frequencies can be calculated using the formula. Expected frequency = ( Row Total x Column Total) / Grand Total. The expected frequencies are, Age the responde nt Below 22 22 24 25 27 28 30 of The office has policies that are supportive to its staff Strongl Agree Neither y Agree 1.8 0.8 0.6 0.4 1.35 0.6 0.45 0.3 0.3 Agree Disagree 2.7 1.2 0.9 0.6 0.6 0.9 0.4 0.3 0.2 0.2 2.25 1 0.75 0.5 0.5 Strongly Disagree NorDisagree

Above 30 0.4

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When applying X2, O 1 1 1 1 2 1 3 2 1 E 1.8 0.8 0.6 0.4 0.4 0.6 0.3 0.3 2.7 1.2 0.9 0.6 0.6 O-E -0.8 0.2 0.4 -0.4 0.6 -0.6 -0.3 -0.3 0.3 0.8 0.1 -0.6 -0.6 (O-E)2 (O-E)2/E 0.64 0.4 0.16 0.16 0.36 0.42 0.36 0.30 0.9 0.9 0.9 0.64 0.1 0.36 0.36 0.35 0.5 0.26 0.4 0.9 0.31 0.6 0.67 0.3 0.3 0.33 0.53 0.1 0.6 0.6

1.35 0.65 0.45 0.55

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1 1 3 1 1 -

0.9 0.4 0.3 0.2 0.2 1 0.5 0.5

-0.9 -0.4 -0.3 0.8 0.8 0 0.5 -0.5

0.81 0.16 0.9 0.64 0.64 0.56 0 0.25 0.25 Total

0.9 0.4 0.3 0.32 0.32 0.24 0 0.74 0.5 0.5 10.97

2.25 0.75

0.75 -0.75 0.56

Calculated Value = X2 = (O-E)2/E X2 = 10.97 Degree of freedom = (r-1) (c-1) = (5-1) (5-1) = (4) (4) = 16 Level of significant = 0.05 Table value of 16 = 26.30. Conclusion: The table value of X2 for 16 d.f at 0.05% level of significance is 26.30. The calculated value of X2 (10.97) is less than the table value. Thus H0 is accepted. Thus, there is no relationship between the age of the respondents and the office has policies that are supportive to its staff.

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FINDINGS:

It is found that most of the respondents leave the job due to work stress and few respondents leave their job due to continue their Higher Education.

It is observed that the respondents agree that the employee is valued as a part in his office and few of the respondents Disagree that the employee is valued as a part in his office.

Most of the respondents agree that the employee are fairly treated and respected and few of the respondents Disagree that the employees are fairly treated and respected.

It is found that most of the respondents Agree that the employee have a clear sense of future direction in this office and few of the respondents Strongly Disagree that the employee have a clear sense of future direction in this office.

Most of the respondents Agree that the office has policies that are supportive to its staff and few of the respondents Disagree that the office has policies that are supportive to its staff.

It is observed that most of the respondents agree that the work load in this office is distributed equitably and only few of the respondents Disagree that the work load in this

office is distributed equitably. Most of the respondents Agree that the employee exactly know what is expected from his/her as an employee and only few of the respondents Disagree that the employee exactly know what is expected from his/her as an employee.

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SUGGESTIONS:

Working conditions should be improved. Employee should be valued as a part in his office. The communication between the staff and the management should be effective. The office policies should be supportive to the employees. Workloads in the office should be distributed equally. There should be a regular staff meeting conducted by the management. Employees should be given constructive feedback about the work performed.

CONCLUSION: To conclude, IT firms need to understand that now, the case is not about giving more salaries and preventing the employees from leaving. Employees need much more than what is obvious. A long-term relationship needs to be established with its employees. Moreover, employees in this sector need a lot of personal space and a well thought-out career growth plan. Also, HR practices are needed to be fine-tuned so as to get the right kind of employees. Some of the strategies suggested in this paper can be very easily implemented without any cost to the company. Some other strategies are not so easily implantable, but are very important for the growth of this sector, and are necessary for benefiting the country on the whole.

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