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Various causes have been attributed to attrition but the primary one's being:

1. The job is too demanding and the employee cannot cope with the late night work
2. The employee leaves to pursue further study or an alternative career
3. The employee leaves for alternative jobs in the BPO-ITES business (accounts for 65-70% of attrition)

The Cost of Attrition

What does attrition cost a company? This is a question which has been of immense interest to all the multinationals. It has been researched and found that the cost of attrition is 1.5 times the annual salary. BPO employees changing jobs cost the industry an estimated Rs 350 crore in recruitment and training costs in the fiscal year 2004. The rate of attrition in some companies can be as high as 60% per annum. Companies also run the risk of inefficiency, impacting client agreements and business development efforts.

Strategies to Address Attrition

Human Relations is one of the key challenges of the BPO industry and has formed a special task force to address short-term challenges such as attrition. Companies must look into various options like good rewards, bonding programs, flexible working hours and stronger career path. With attrition rates ranging between 30-60 percent in the BPO industry, it is my view that a scientific and analytical approach should be implemented.

Pay cheques alone are not enough to retain employees. Management also needs to consider other aspects like secure career, benefits, perks and communication. The attrition battle could be won by focusing on retention, making work a fun place, having education and ongoing learning for the workforce and treating applicants and employees in the same way as one treats customers.

Companies need to go in for a diverse workforce, which does not only mean race, gender diversity, but also include age, experience and perspectives. Age should not be a barrier for training employees and could in fact bring in more stability to the company. Diversity in turn results in innovation and success. The 80:20 rule applies to recruitment since studies showed that 80 percent of the company's profit comes from the efforts of 20 percent of the employees. So BPOs need to focus on roles, which have the most important impact.

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* Contributed by -
Srinath Raj Kasi ,
PGDIM XI ,
NITIE ,Mumbai .