KEY FACTORS OF RETENTION IN TELECOM

KEY FACTORS OF RETENTION AND RETENTION
STRATEGIES INTELECOMSECTOR
Rajnish Ratna
Assistant Professor(HR &OB),AmityBusiness School,AmityUniversity,Noida.
Saniya Chawla
FacultyAssociate(HR),LalBahadurShastriInstituteofManagement,NewDelhi.
ABSTRACT
Ahigh rate of employee attrition is a challenge for most companies in the telecom sector.An insight
to which are the most effective retention strategies that can have a long-term impact. Companies now adopt
more than one technique to create an internal environment that will retain their employees.The purpose of
the paper is to study out the key factors of retention, employee's satisfaction level about key factors and the
retention strategies being followed in the telecom sector. Exploratory research is used. Primary data was
collected from 107 employees from three leading companies of telecom sector (NCR) through the designed
questionnaire and secondary data is collected through annual reports and online resources. With
secondary research we identified ten factors (importance of training, consultation of the employees during
target setting, satisfaction with compensation level, rewards and recognition given to the executives,
working conditions, job capability, ability to meet targets, plans to start their own business, satisfaction
with the initiatives taken by hr, and participation in management) play important role in attrition /
retention. After analysis of primary data, it was found that their some factors such as compensation level,
and rewards and recognition etc. their satisfaction is less while in other factors like training, and working
conditions etc. it is up to the mark. A comprehensive list of the retention strategies is mentioned that are
followed by the companies. The factors mentioned above wherein the satisfaction level of employees is less,
companiesneedstotakeinitiativesforbettermentthenonlyrequiredretentionlevelwillbeachieved.
INTRODUCTION
ATTRITION RATE
The attrition rate has always been a sensitive
issue for all organizations. Calculating employee
turnover rate is not that simple, as it seems to be.
No common formula can be used by all the
organizations.Aformula had to be devised keeping
in view the nature of the business and different job
functions. Moreover, calculating attrition rate is
not only about devising a mathematical formula. It
also has to take into account the root of the problem
by going back to the hiring stage. Many firms may
not include attrition of fresher's who leave because
of higher studies or within three months of joining.
In some cases, attrition of poor performers may
also not be treated as attrition. Calculating attrition
rate:
Attrition rates can be calculated using a
simpleformula:
Attrition=(No. of employees who left in the year /
average employees in the year) x 100
Thus, if the company had 1,000 employees
35Sona Global Management Review | Volume 6 | Issue 3 | May 2012
inApril 2004, 2,000 in March 2005, and 300 quit in
the year, then the average employee strength is
1,500 and attrition is 100 x (300/1500) = 20
percent. Besides this, there are various other types
ofattrition:
§Fresher attrition that tells the number of
fresher's who left the organization within one
year. It tells how many are using the company
asaspringboardoralaunchpad.
§Infant mortality that is the percentage of
people who left the organization within one
year. This indicates the ease with which
peopleadapttothecompany.
§Critical resource attrition, which tells the
attrition in terms of key personnel like senior
executivesleavingtheorganization.
§Low performance attrition: It tells the
attrition of those who left due to poor
performance.
ATTRITION COSTS
One of the best methods for calculating the
cost of turnover takes into account expenses
involved to replace an employee leaving an
organization.Theseexpensesare:
A. Recruitmentcost
The cost to the business when hiring new
employees includes the following six factors
plus 10 percent for incidentals such as
background screening, time spent on
sourcing replacement, time spent on
recruitment and selection, travel expenses,
re-location costs, if any in Training/ramp-up
timeandbackground/referencescreening
B.Trainingand developmentcost
To estimate the cost of training and
developing new employees, cost of new hires
must be taken into consideration. This will
mean direct and indirect costs, and can be
largely classified as training materials,
technology, employee benefits and trainers'
time.
C.Administration cost
It includes setting up communication
systems, adding employees to the HR
system, setting up the new hire's workspace
andsettingup ID-cards,accesscards,etc.
EMPLOYEERETENTION
Hiring knowledgeable people for the job is
essential for an employer. But retention is even
more important than hiring. Employee Retention
involves taking measures to encourage employees
to remain in the organization for the maximum
period of time. Corporate is facing a lot of
problems in employee retention these days. In...