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ABSTRACT
Employee retention is a process in which the employees are encouraged to
remain with the organization for the maximum period of time or until the completion
of the project. Employee retention is beneficial for the organization as well as the
employee. Employees today are different. They are not the ones who dont have good
opportunities in hand. As soon as they feel dissatisfied with the current employer or
the job, they switch over to the next job. It is the responsibility of the employer to
retain their best employees. If they dont, they would be left with no good employees.
A good employer should know how to attract and retain its employees.
Most employees feel that they are worth more than they are actually paid.
There is a natural disparity between what people think they should be paid and what
organizations spend in compensation. When the difference becomes too great and
another opportunity occurs, turnover can result. Pay is defined as the wages, salary, or
compensation given to an employee in exchange for services the employee performs
for the organization. Pay is more than "dollars and cents;" it also acknowledges the
worth and value of the human contribution. What people are paid has been shown to
have a clear, reliable impact on turnover in numerous studies.
Employees comprise the most vital assets of the company. In a work place
where employees are not able to use their full potential and not heard and valued, they
are likely to leave because of stress and frustration. In a transparent environment
while employees get a sense of achievement and belongingness from a healthy work
environment, the company is benefited with a stronger, reliable work-force
harbouring bright new ideas for its growth Blog Online And Earn Money.
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Introduction
Employee turnover is one of the largest though widely unknown costs an
organization faces. While companies routinely keep track of various costs such as
supplies and payroll, few take into consideration how much employee turnover will
cost them: Ernst & Young estimates it costs approximately $120,000 to replace 10
professionals. According to research done by Sibson & Company, to recoup the cost
of losing just one employee a fast food restaurant must sell 7,613 combo meals at
$2.50 each. Employee turnover costs companies 30 to 50% of the annual salary of
entry-level employees, 150% of middle-level employees, and up to 400% for upper
level, specialized employees. Now that so much is being done by organizations to
retain its employees.
Why is retention so important? Is it just to reduce the turn over costs ?
Well, the answer is a definite no. Its not only the cost incurred by a company that
emphasizes the need of retaining employees but also the need to retain talented
employees from getting poached.
Retention involves five major things:
Compensation
Environment
Growth
Relationship
Support
Compensation:
Compensation constitutes the largest part of the employee retention process. The
employees always have high expectations regarding their compensation packages.
Compensation packages vary from industry to industry. So an attractive
compensation package plays a critical role in retaining the employees.
Compensation includes salary and wages, bonuses, benefits, prerequisites, stock
options, bonuses, vacations, etc. While setting up the packages, the following
components should be kept in mind:
BES Group of Institutions (GVIC), Angallu
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Basic wage
Dearness allowance
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Flexible hours
Telecommuting
Dependent care
Alternate work schedules
Vacations
Wellness
work,
involvement
in
decision-making,
clarity
of
work
and
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development:
Taking
proper
care
of
employees
includes
The feedback from supervisor helps the employee to feel more responsible, confident
and empowered. Top management can also support its employees in their personal
crisis by providing personal loans during emergencies, childcare services, employee
assistance Programs, conseling services, etc
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By providing feedback
By counseling them
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INDUSTRY PROFILE
India is the world leader in milk production with total volume of 115 million
tons. Driven by steady population growth and rising income, milk consumption
continues to rise in India. Dairy market is currently growing at an annual growth rate
of around 7 per cent in volume terms. The market size of Indian dairy industry stands
at around US$ 45 billion.
Since Indias population is predominantly vegetarian; milk serves as an
important part of daily diet. Indians use milk in various preparations such as in
brewing tea and coffee, in making yogurt or curd and in preparing many Indian
dishes. For most households, milk is also a popular beverage due to its nutritional
value.
In India, rural households consume almost 50 percent of total milk production.
The remaining 50 percent is sold in the domestic market. Of the share of milk sold in
the domestic market, almost 50 percent is consumed in fluid form, 35 percent is
consumed as traditional products (cheese, yoghurt and milk based sweets), and 15
percent is consumed for the production of butter, ghee, milk powder and other
processed dairy products (including baby foods, ice cream, whey powder, casein, and
milk albumin).
Most dairy products are consumed in the fresh form and only a small quantity
is processed for value addition. In recent years, however, the market for branded
processed food products has expanded. Although only around 2 per cent food is
processed in India, still the highest processing happens in the dairy sector, where 35
per cent of the total produce is processed, of which only 13 per cent is processed by
the organised sector.
While world milk production declined by 2 per cent in the last three years,
according to FAO estimates, Indian production has increased by 4 per cent. The milk
BES Group of Institutions (GVIC), Angallu
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USA
7002
UK
5417
Canada
5348
New Zealand
2976
Pakistan
1052
India
795
World (Average)
2021
Source: Export prospects for agro-based industries, World Trade Centre, Mumbai.
MARKET SIZE AND GROWTH:
Market size for milk (sold in loose/ packaged form) is estimated to be 36mn
MT valued at Rs470bn. The market is currently growing at round 4% pa in volume
terms. The milk surplus states in India are Uttar Pradesh, Punjab, Haryana, Rajasthan,
Gujarat, Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu. The
manufacturing of milk products is concentrated in these milk surplus States. The top 6
states viz. Uttar Pradesh, Punjab, Madhya Pradesh, Rajasthan, Tamil Nadu and
Gujarat together account for 58% of national production.
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Production in million MT
1988-89
48.4
1989-90
51.4
1990-91
53.7
1991-92
56.3
1992-93
58.6
1993-94
61.2
1994-95
63.5
1995-96
65
1996-97
68.5
1997-98
70.8
1998-99
74.7
1999-00(E)
78.1
2000-01(T)
81.0
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MAJOR PLAYERS
The packaged milk segment is dominated by the dairy cooperatives. Gujarat
Co-operative Milk Marketing Federation (GCMMF) is the largest player. All other
local dairy cooperatives have their local brands (For e.g. Gokul, Warana in
Maharashtra, Saras in Rajasthan, Verka in Punjab, Vijaya in Andhra Pradesh, Aavin in
Tamil Nadu, etc). Other private players include J K Dairy, Heritage Foods, Indiana
Dairy, Dairy Specialties, etc. Amrut Industries, once a leading player in the sector has
turned Diary Products rupt and is facing liquidation.
PACKAGING TECHNOLOGY
Milk was initially sold door-to-door by the local milkman. When the dairy cooperatives initially started marketing branded milk, it was sold in glass bottles sealed
with foil. Over the years, several developments in packaging media have taken place.
In the early 80's, plastic pouches replaced the bottles. Plastic pouches made
transportation and storage very convenient, besides reducing costs. Milk packed in
plastic pouches/bottles have a shelf life of just 1-2 days, that too only if refrigerated.
In 1996, Tetra Packs were introduced in India. Tetra Packs are aseptic laminate packs
made of aluminum, paper, board and plastic.
Milk stored in tetra packs and treated under Ultra High Temperature (UHT)
technique can be stored for four months without refrigeration. Most of the dairy cooperatives in Andhra Pradesh, Tamil Nadu, Punjab and Rajasthan sell milk in tetra
packs. However tetra packed milk is costlier by Rs5-7 compared to plastic pouches. In
1999-00 Nestle launched its UHT milk. Amul too re-launched its Amul Taaza brand of
UHT milk. The UHT milk market is expected to grow at a rate of more than 10-12%
in coming years
EXPORT POTENTIAL
India has the potential to become one of the leading players in milk and milk
product exports. Location advantage: India is located amidst major milk deficit
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Weakness
million farmers
Traditional
emphasis
on
consumption
Opportunity
Threat
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Elastic
demand;
economic
Increasing
preference
1995-96
Quantity
Value
Quantity
Value
Quantity
Value
Skimmed
powder
4,638.62
3,35.32
282.70
19.64
5.00
0.375
8.27
2.019
111.37
4.27
11.00
2.02
Milk cream
332.23
28.04
1.00
0.084
Sweetened
condensed milk
41.73
2.84
9.22
0.97
60.39
7.22
Whey
78.46
3.75
11.50
1.01
6.00
0.342
Ghee/Butter/Butter
oil
7,895.08
431.1
299.97
19.2
4,352.08
2,38.95
(a) Fresh
0.10
0.013
(b) Processed
5.67
1.20
2.1
0.375
22.10
2.19
(c) Other
66.64
8.35
36.78
0.69
24.84
4.55
TOTAL
8,72.7
52.4
2,55.6
milk
1996-97
1997-98
Cheese
KEY FACTS
BES Group of Institutions (GVIC), Angallu
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Carton milk or packaged milk has been growing at 24 per cent annually
Most branded FMCG companies are keen on launching flavoured dairy products
whose market size is pegged at US$ 166 million
CRITICAL ISSUES
Liquid milk
Business concerns
Demand drivers
Sourcing
Packaging in smaller
operatives
units
Convenience
Distribution
Packaged
Technology
milk
Health concerns
Milk
Branding
products
Inadequate infrastructure
income
Refrigeration
Infant mil
Education
Poor penetration
Marketing
REGULATORY CHANGES
KEY LEGISLATIONS:
Milk and Milk Products Order 1992: With following controls
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COMPANY PROFILE
JERSEY CREAMLINE DAIRY PRODUCTS LTD:
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RESEARCH METHODOLOGY
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Culture
Values
Company reputation
Risk taking
Leading technologies
Trust
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Mentoring programs
Performance feedback programs
Provide necessary tools to the employees to achieve their professional and personal
goals
Getting the most out of employee interests and talents
Higher study opportunities for employees
Vocational counselling
Offer personalized career guidance to employees
Management communications
Intranet and internet can be used as they provide 24X7 access to the information
Newsletters, notice boards, etc.
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Hire the right people from the beginning: employee retention is not a process that
begins at the end. The process of retention begins right from the start of the
recruitment process.
The new joinees should fit with the organizations culture. The personality,
leadership characteristics of the candidate should be in sync with the culture of the
hiring organization.
Referral bonus should be given to the employees for successful hires. They are the
best source of networking. Proper training should be given to the managers on
interview and management techniques. An internship program can be followed to
recruit the fresh graduates.
Retention Success Mantra
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Quality Of Work
The success of any organization depends on how it attracts, recruits,
motivates, and retains its workforce. Organizations need to be more flexible so that
they develop their talented workforce and gain their commitment. Thus, organizations
are required to retain employees by addressing their work life issues. The elements
that are relevant to an individuals quality of work life include the task, the physical
work environment, social environment within the organization, administrative system
and relationship between life on and off the job. The basic objectives of a QWL
program are improved working conditions for the Employee and increase
organizational effectiveness.
Providing quality work life involves taking care of the following aspects:
Occupational health care: The safe work environment provides the basis for the
person to enjoy working. The work should not pose a health hazard for the person.
The employer and employee, aware of their risks and rights, could achieve a lot in
Their mutually beneficial dialogue.
Suitable working time: Organizations are offering flexible work options to their
employees wherein employees enjoy flexi-timings for dedicating their efforts at work.
Appropriate salary: The appropriate as well as attractive salary has always been an
important factor in retaining employees. Providing employees salary at par with the
other counterparts of above that what competitors are paying motivates them to stick
With the company for long. QWL consists of opportunities for active involvement in
group working arrangements or problem solving that are of mutual benefit to
employees or employers, based on labor management cooperation.
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Feedback
Feedback acts as a channel of communication between the employee and his manager.
The amount of information employees receive about how well or how poorly they
have performed is what we call feedback. It is a dialog between a manager and an
employee which acts as a way of sharing information about the performance. It
suggests where the employee performance is effective and where performance has to
improve. Managers can provide either positive feedback or negative feedback to
employees. This feedback helps the employee assess his performance and identify the
improvement areas. Positive feedback communicates managerial satisfaction. Positive
recognition for good performance boosts up morale of employees and results in
performance improvement to a higher productivity level. It is believed that positive
feedback is the only type of feedback that generates performance above the minimum
acceptable
level.
Negative
feedback
obviously
communicates
managers
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It gives managers and employees a way to identify and discuss skills and strengths.
It helps in identifying performance areas that need improvement and specific ways to
improve them. It acts as an opportunity to enhance performance by identifying
resources for skill development. It is an opportunity for managers and employees to
assess and identify career and advancement opportunities. It helps employees to
understand the effectiveness of their performance and contributes to their overall
knowledge about the work Managers have tendency to ignore good performances of
their employees. Providing no feedback may demotivate employees and may lead to
employee absenteeism. Input from managers side is necessary as it help employees to
improve their performance and increase productivity.
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Rewards that are spontaneous (sometimes called on-the-spot awards) are also highly
motivating and should also use a set criteria and standard to maintain credibility and
meaning.
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Case Studies
1.Employee Retention Best Practices in Keeping and Motivating Employees By
LisBeth Claus Ask any CEO of an organization, What keeps you awake at night?
and you will get a response that relates to people management issues. a main concern
for any organization (whether small or large; private, public or nonprofit) is its
capacity to attract, engage, and retain the right people. The problem of retention is
compounded by the predicted talent shortage resulting from the upcoming retirement
of the baby boomers, the scarcity of talent with relevant work skills for todays jobs,
the changing values about work and the high cost of turnover. Research and human
resource practices provide us with a number of recommendations to increase
employee retention.
2.How Auditing Company X Works with Retaining Valuable Employees : Swedish
Case
study
University
essay
from
Hogskolan
Jonkoping/IHH,
EMM
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degree,
including
specific
courses
within
au-diting/accounting.
Furthermore, the person needs practical experience for a specific period of time. Due
to these statements the challenge of retaining and motivating valuable employees is
crucial for the auditing firms, which is why we have chosen to do a case study at
Auditing Company X to see how they work with employee retention. We have
compared the findings to our chosen theory, which consist of four categories: the
hiring process, in-ternal labor market and career, motivation and performance, and
finally culture and leader-ship. These four categories are initially based on Leigh
Branham?s book: ?Keeping the people who keep you in business: 24 ways to hang on
to your most valuable talent? (Bran-ham, 2001).
In our conducted case study, at Auditing Company X, we have been able to conclude
that the firms retention practices are to a great extend in line with the theoretical
framework. There are some areas that need further attention from the company, such
as an individualized reward system and communication between managers and
employees. Even though there are some parts to work on the most important aspects
of retention, such as having a holistic and long-term orientation, Auditing Company X
seems to have incorporated this into their practices successfully.
3.Retention: An explanatory study of Swedish employees in the financial sector
regarding leadership style, remuneration and elements towards job satisfaction
University essay from Vaxjo universitet/Ekonomihogskolan Author: Sanna Paulsson;
Linda Lindgren; [2008]
Abstract: Introduction: Companies today are forced to function in a world full of
change and complexity, and it is more important than ever to have the right employees
in order to survive the surrounding competition. It is a fact that a too high turnover
rate affects companies in a negative way and retention strategies should therefore be
BES Group of Institutions (GVIC), Angallu
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Following key questions are intended to be answered: What are the consequences
between leaders actions and employees retention? Which is the leaders role when it
comes to retaining employees? Purpose statement: The purpose of the thesis is to
investigate and analyze how company leaders today can retain their key employees.
How can the provision of key human resources develop a long-term relationship that
makes top employees stay in the company? The study aims to establish the procedure
leaders apply to retain employees. The purpose is to compare the qualitative study,
made at the case company, with findings from the thesis theoretical framework.
Research method:
The study is a qualitative, as well as a theoretical study where empirical
findings and theories has been compared. The intention of investigating and using the
Finnish company Creamline Diary Products Limited as a case company, is to make
the information from the theories more valid, and also the interest in how retention
management works in practice. Eleven qualitative interviews were conducted at
Creamline Diary Products?
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FINDINGS
It is found out that, 76% of respondents are getting right amount of accurate
information at right time and 24% of respondents are not getting right amount
of accurate information at right time.
It is found out that, 82% of respondents are able to meet superiors expectation
and 18% respondents are not able to meet superiors expectation.
It is found out that,57% of respondents feels that there pay is on par with
compare to employees handling similar responsibilities, and 39% of
respondents feels that there pay is less with compare to employees handling
similar responsibilities.
It is found out that, 70% of respondents are satisfied with hygiene and
cleanliness of company infrastructure and 30% of respondents are not satisfied
with hygiene and cleanliness of company infrastructure.
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It is found out that, 78% of respondents skills are recognized by superiors and
22% of respondents skills are not recognized by superiors.
It is found out that, 74% of respondents feel that superiors are taking efforts to
motivate them and 26% of respondents feel that superiors are not taking
efforts to motivate them.
It is found out that, 83% of respondents feel that workload is manageable and
10% of respondents feel that workload is very hard to manage.
It is found out that,55% of respondents feels that the field worker are able to
get updates on internal activities, and 45% of respondents feels that the field
worker are not able to get updates on internal activities.
It is found out that, 89% of respondents feel that the superiors are easily
accessible and 11% of respondents feel that the superiors are not easily
accessible.
It is found out that, 51% of respondents feel that their complaints are resolved
quickly and 49% of respondents feel that their complaints are not resolved
quickly.
From weighted Average analysis it is found that most of the respondents are
satisfied with the working hours of the organization
From weighted Average analysis it is found that roles & responsibilities are
clearly defined by the Reporting heads.
From weighted Average analysis it is found that employees feel that their
superior's commitment towards job is good.
From weighted Average analysis it is found that respondents feel that training
and orientation programs are neither good nor bad.
From weighted Average analysis it is found that most of the respondents are
satisfied with job.
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From One Run Test it is found that the samples are taken randomly.
SUGGESTIONS
If any changes are brought in to software or any module is added then proper
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Conclusion
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Recommendations
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4. Be flexible in terms of work-life balance. Workers more and more value a balance
between work and life. They want more flexible ways to engage with their employer.
To attract and retain workers with different work and career expectations,
organizations have to be more flexible in structuring work and its expectations. It calls
for a different managerial mindset and practices that involve letting go of old ways of
controlling workers time and attendance in favor of result criteria such as output,
productivity and quality.
6. Train managers to be effective. Exit interviews consistently show that poor and
bad management practices greatly contribute to an employees decision to leave a
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BIBLIOGRAPHY
BOOKS
Human Resource Management C.B.Memoria
Research methodology C.R.Kothari
Journals, Newspaper and Internet
a2zmba.blogspot.com
hrmba.blogspot.com
mbafin.blogspot.com
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