EXECUTIVE SUMMARY In the current scenario of high economic growth and rapidglobalization, the fight for talent is becoming

increasingly intense. Talent or human resource is a major asset for any company. CompanyInvest high amount of money for their recruitment, selection & trainingand what happens to company if these Talents or Employees leave theorganization in short while seeking new opportunities.Plagued byerratic attrition trends and cutthroat global competition, organizationsare now realizing the need to understand the supply-demand equationbetter in order to garner strong mechanisms to attract and retain toptalent.Employee retention is critical to the long-term health and success of any organization; however it is becoming increasingly difficult forcompanies across the globe to attract, motivate and retain key talent.Attrition rates are still on the rise and as the war for talent becomesmore intense each year it is becoming increasingly important forcompanies to ensure they have the right people in place to guidefuture business success.Overall attrition rates are continuing to rise in Asia. The aggregate rateacross all markets reached 18 percent in 2007, marking a two percentincrease on 2006. Meanwhile budgeted attrition, which remained lowerthan actual attrition, rose slightly from 10 to 11 percent year on year. 7 At 39 percent, overall employee turnover was highest at theprofessional /supervisor/ technical level. Unsurprisingly, attrition waslowest among senior/top management at just 0.5 percent. The Bankingand Finance sector saw the greatest employee turnover at 25 percent,while the lowest turnover was recorded in the manufacturing industryat 11 percent. The facts revealed that external inequity of compensation was themain reason for employees leaving their organization; however othercauses include limited growth opportunities and role stagnation.Retention also remains a key challenge in BPO and pharmaceuticalindustry. More than half of the employees in this sector have aretention bonus plan or are in discussions to create one. The top threeretention measures suggested are: pay above the market; provide theopportunity to learn new skills; and encourage a favorable work/lifebalance. An overwhelming majority of companies

said they house anexit-interview policy to learn more about why employees are leaving. Introduction In an environment of rapid growth, globalization and expansion, thepressure to attract and retain outstanding employees has become ascary reality for most organizations. The new-age economies, with theirattendant paradigm shifts in human capital management, have placeda heavy demand on todays organizations and Attrition is emerging asa key business concern for organizations. It is turning into a biggerissue than attracting talent. The annual attrition rate is 20-30 per cent(reduction in the number of employees through retirement, resignationor death) across industries in India. It is as high as 44 per cent in BFSI 8 (banking, financial services and insurance) vertical and 35 per cent inBPO (business process outsourcing). Attracting and retaining key talenthas become one of the key drivers of overall business performance inorganizations and companies have been utilizing a diverse range of methods to draw in new hires and ensure they stay as Attrition is anexpensive phenomenon, potentially impacting the bottom line of businesses. The cost of attrition is not just the loss of that employee but it includesan array of hidden costs such as recruitment costs, selection costs,training costs, cost of covering during the period and opportunitycosts. The organizational costs associated with the turnover in terms of hiring, training and productivity loss costs can add up to more than fiveper cent of an organizations operating costs.As far as India is concerned, attrition is a serious trend, especially intodays knowledge-driven marketplace where people are the mostimportant assets. While organizations cope with attrition by devisingcompelling retention strategies, it is imperative for organizations topredict attrition early in the recruitment process to curtail loss of time,cost and effort. 9 BACKGROUND First of all we need to know what attrition exactly is. Attrition is therate of shrinkage in the size or a

gradual, natural reduction inmembership or personnel, as through retirement, resignation,or death. It is Normal and uncontrollable reduction of a work forcebecause of retirement, death, sickness, and relocation. It is onemethod of reducing the size of a work force without managementtaking any overt actions. The drawback to reduction by attrition is thatreductions are often unpredictable and can leave gaps in anorganization. The formula for calculating attrition rate is; -Attrition Rate% =Total no of resignation per month( W h e t h e r v o l u n t a r y o r c o m p u l s o r y ) x 100Total no of employee in the beginning of the month + totalNo of new joinees total no of resignation. Attrition causes huge loss to the company, not only in terms of manpower but also in monetary terms. The cost of attrition would beexplained in details later in this report. Moreover, this report will alsocover the reasons why the employees leave a company. Attrition is auniversal phenomenon and no industry is devoid of it, but the degree 10 fluctuates from industry to industry and at different levels. Attrition byEmployee GroupAccording to the study, the overall employee turnover rate was highestat the professional/supervisor/technical staff level, recording total andvoluntary attrition at a very high 39 percent and 33 percentrespectively. (See Figure 1) The professional/supervisor/technical group constitutes a highpercentage of the total employee base in all organizations and highattrition at this level impacts the business adversely. At 0.5 percent,attrition was lowest at the senior/top management level. Employees atthis level tend to be nearing the end of their careers, which meansthey are more averse to risk and more likely to move to opportunitiesthat are substantially better. Hence attrition is considerably low at thislevel. 1)Employee attrition by group 11 We have examined two important sectors in which the attrition rate ishigh i.e. BPO/IT industry and pharmaceutical industry, and we havefocused basically at middle level of employees where the rate

ishighest. Lastly, this report will explain what can be done to control theattrition in both these sectors. And what are the measures that aretaken up by other companies.2). 12 13 BPO Industry in India It is said that the Indian BPO Industry has come of age. This is verytrue if we analyze both the past and present scenarios. Defying all thepermutations and combinations, the Indian outsourcing industry hasregistered a massive growth over the years. India has remained one of the most favorite offshore destinations for BPO/ITES activities. One of the most prominent reasons for the same is cheap labor. Over the pastfive years, the Indian BPO/ITES has been growing at a rate of about 50-60%. As per NASSCOM, the Indian BPO/ITES registered a growth rate of 46% and clocked revenue of UD$ 3.6 billion in 2003-04 up from UD$2.5 billion in 2002-03.This industry has contributed a great deal to theexport revenues of the country and is expected to do that in future too. This industry is expected to generate one million jobs by 2009. HRmanagement is one of the most critical areas in this industry, soimportant that it can be referred to as HR-enabled services rather thanIT-enabled services. The reason for the same is that this industry isfacing a very high rate of attrition of around 30-40%. Though this rateis not very high as compared to US which faces an attrition rate of around 70% though, our next main competitor in this area, China, isfacing the attrition rate as low as 12-15%. The consequence of thesame is that this results in higher costs to the company and so thecompanies may lose its main competitive edge which is lower costs.Later on, we have explained why the cost of attrition is so high. Thismeans that there is a very high need to control the attrition rate in theindustry. 14 Pharmaceutical industry in India The Indian Pharmaceutical Industry today is in the front rank of Indias science-based industries with wide ranging capabilities in thecomplex field of drug manufacture and technology.

A highly organizedsector, the Indian Pharma Industry is estimated to be worth $ 4.5billion, growing at about 8 to 9 percent annually. It ranks very high inthe third world, in terms of technology, quality and range of medicinesmanufactured. From simple headache pills to sophisticated antibioticsand complex cardiac compounds, almost every type of medicine is nowmade indigenously.According to the Economic Survey (2006-07), the pharmaceuticalsindustry had achieved a turnover of about US$ 12 billion in 2005-06,and is expected to grow by 13% in 2007. Its pharma export valuereached about US$ 4.7 billion during 200506.Pharmaceuticalindustry accounts for about 2.91% of total FDI into the country. TheFDI in pharmaceutical sector is estimated to have touched US$ 172million, thereby showing a compounded annual growth rate of about62.6%. Drugs and pharmaceuticals sector is at 8th rank in India'stop 10 FDI attracting sectors. According to the Economic Survey forthe year 2006-07, the value of pharma output has increased tentimes over the last 15 years. 15 From Rs. 50 billion in 1990 it has grown to Rs.550 billion (US$ 12billion) in 2005-06. Driven by growing number of pharmaceuticalunits, increased knowledge skills, improved quality and increasingnational as well as international demand, India is now recognized as aleading global pharma player. 1 W HY BOTH THE SECTORS ARE GROWING AT AFASTPACE a) Competent workforce: India has a pool of personnel withhigh managerial and technical competence as also skilledworkforce. It has an educated work force and English iscommonly used. Professional services are easily available. b) Cost-effective chemical synthesis: Its track record of development, particularly in the area of improved costbeneficial chemical synthesis for various drug molecules isexcellent. It provides a wide variety of bulk drugs andexports sophisticated bulk drugs.

c) Legal & Financial Framework: India has a 58 year olddemocracy and hence has a solid legal framework and 1 Facts and figures taken from www.pharmainfo.net. 16 strong financial markets. There is already an establishedinternational industry and business community. d) Information & Technology: It has a good network of world-class educational institutions and establishedstrengths in Information Technology. e) Globalization: The country is committed to a free marketeconomy and globalization. Above all, it has a 70 millionmiddle class market, which is continuously growing. f) Consolidation: For the first time in many years, theinternational pharmaceutical and outsourcing industry isfinding great opportunities in India. The process of consolidation, which has become a generalizedphenomenon in the world pharmaceutical industry, hasstarted taking place in India. COST OF ATTRITION There are a number of costs which are incurred by a BPO when theyhire any new employee. These costs can be in terms of monetary orcan be in terms of time wasted or any other intangible things. Some of these costs can be as stated below: Costs Due to a Person Leaving 17 I. RecruitmentCosts 1.The cost of advertisements; agency costs; employee referralcosts; internet posting costs.2.The cost of the internal recruiter's time to understand theposition requirements, develop and implement a

sourcingstrategy, review candidates backgrounds, prepare for interviews,conduct interviews, prepare candidate assessments, conductreference checks, make the employment offer and notifyunsuccessful candidates. This can range from a minimum of 30hours to over 100 hours per position. 3. Calculate the cost of the various candidate pre-employment teststo help assess candidates' skills, abilities, aptitude, attitude,values and behaviors. II.TrainingCosts 1. The cost of orientation in terms of the new person's salary andthe cost of the person who conducts the orientation. Also includethe cost of orientation materials. 2. The cost of departmental training as the actual development anddelivery cost plus the cost of the salary of the new employee.Note that the cost will be significantly higher for some positionssuch as sales representatives and call center agents who require4 - 6 weeks or more of classroom training. 3. The cost of the person(s) who conduct the training. 4. The cost of various training materials needed including companyor product manuals, computer or other technology equipmentused in the delivery of training. 18 III. Lost Productivity Costs As the new employee is learning the new job, the companypolicies and practices, etc. they are not fully productive. Use thefollowing guidelines to calculate the cost of this lost productivity: 1. Upon completion of whatever training is provided, the employeeis contributing at a 25% productivity level for the first 2 - 4weeks. The cost

therefore is 75% of the new employees fullsalary during that time period. 2. During weeks 5 - 12, the employee is contributing at a 50%productivity level. The cost is therefore 50% of full salary duringthat time period. 3. During weeks 13 - 20, the employee is contributing at a 75%productivity level. The cost is therefore 25% of full salary duringthat time period.4.Calculate the cost of mistakes the new employee makes duringthis elongated indoctrination period. IV.NewHireCosts 1. The cost of bring the new person on board including the cost toput the person on the payroll, establish computer and securitypasswords and identification cards, telephone hookups, cost of establishing email accounts, or leasing other equipment such ascell phones, automobiles. 2. The cost of a manager's time spent developing trust and buildingconfidence in the new employee's work. V.LostSalesCosts 19 1. Calculate the revenue per employee by dividing total companyrevenue by the average number of employees in a given year.Whether an employee contributes directly or indirectly to thegeneration of revenue, their purpose is to provide some definedset of responsibilities that are necessary to the generation of revenue. Calculate the lost revenue by multiplying the number of weeks the position is vacant by the average weekly revenue peremployee. Thus we can say that if a person leaves a job company has to sufferlosses as it involves many costs. FACTORS The main factors of attrition in both sectors are as follows: 1) External inequity of compensation External inequity arises when an employee realizes that some otheremployee from a different organization puts in much less efforts

thanhe does, but receives a much higher compensation than him. Thiscould cause an employee to feel that maybe he is not gettingcompensated fairly and can cause him to quit the job 2)WorkTimings The work timings in BPO are very odd. This affects the family life of theemployee. Moreover, the male to female ratio in BPO is quiet low. Thenumber of females in BPO can be as large as 35%. This means thatworking hour problem is quiet acute in their case especially after they 20 get married, as after marriage comes social and family pressure toadjust work timings and take care of families. 3) CareerGrowth Only 2 out of 10 employees on an average go on to be at the seniorlevel. This means that other employees look forward to change their job at other places where they can get better opportunities toprogress. Also, another problem arises with the mis-match of expectations and qualifications of the employees. Along with that,some employees see no career growth in this sector, so they move onto other companies in search of changing the sector. 4)HigherEducation This is a problem as most of the employees in this sector are prettyyoung and aspiring. They join the firm because of lucrative salary. Butwith time, they try to move on to other sectors or top management and one of the ways to do this is higher education 5)Rolestagnation Attrition rate is higher at knowledge level (middle level) in which theemployee has to do the same work again and again, which makes hiswork monotonous and due to lack of responsibility and authority hisgrowth is restricted to a particular role, so they move to other 21 companies where they can play different roles and handleresponsibility. 6) Work life imbalance

The scientific approach towards management and organizationresulted in a rigid structural hierarchy, exhaustive specialization of jobs, deployment of unskilled employees and an unfavorable workenvironment. This led to high employee turnover, decline inproductivity, absenteeism. 7) Lack of recognition When an employee feels that he is not getting due recognition for hisachievement, a feeling of demotivation creeps into him, and this cancause him to consider leaving the organization. Employees have anexpectation that when they work well, they will get some recognitionfrom their managers in the form of a personal appreciation or an awardetc. 8) Under-utilization of skills Proper utilization of skills has a tremendous impact on the satisfactionof employees. If a work is given to an employee it must be supportedby adequate powers and responsibilities which enable them to move 22 up the career ladder and when their skills and potential is beingoverlooked they end up with leaving the job. 9) Performance assessment An employee may feel disappointed by the performance appraisalreport and feel that he has not been appraised in an unbiased manner.It may happen that he feels that the appraisal process itself is flawedand the appraisers are biased. This can cause the employee to put inhis papers and leave the organization. 10) Internal inequity of compensation Internal inequity occurs when the employee feels that the amount of efforts he puts in to do his job are much more than what rewards hegets in return for them. This can cause him to feel de-motivated andnurture feelings of dissatisfaction and eventually resign from his post. 11) Business instability 23 Many a times, when the organization faces some kind of instability oruncertainty with regards to operations, an employee might quit his

jobbefore he is asked to leave. Many a times when employees get a whimthat the organization is going to down-size or is going to be taken overby another company, they tend to feel safer quitting the job thanworrying about whether the organization will retain them. WAYS TO CONTROL ATTRITION 24 In an environment of rapid growth, globalization and expansion,the pressure to attract and retain outstanding employees has becomea scary reality for most organizations. The new-age economies, withtheir attendant paradigm shifts in human capital management, haveplaced a heavy demand on todays organizations. Keeping in mind thatoverall turnover levels in Asia are high (this includes those who are notonly moving jobs but also shifting careers), attracting and retainingemployees becomes one of the more strategic plans an organizationcan develop. The Road Ahead The road ahead for the BPO and pharmaceutical firms is very importantbecause if they are not able to control the attrition rate they will losetheir competitive edge in the global market. For these certain,strategies and certain improvements are needed to be made in theprocesses followed in order to bring down the rate of attrition to 25% i. Providing Something Extr a Its always about providing something extra to your employees. Goodsalary is something which is a standard in the industry. So what needsto be done is to give some perks to the employees. They need to begiven perks like rewards for their good performances. Owing to the oddworking hours, the employees have very tattered personal lives. Soperks like foreign tours or company sponsored vacations are always awelcome gift. ii. Honoring Performers Performance based incentives is a must in the BPO companies as theseare generally the employees who gets picked up by the placementhunters most often. These employees are also among the mostaspiring ones in the company so there is a need to give them ampleopportunity to rise and progress in the organization. 25

iii. Building Relationship Relationship is something which lasts over time. So, if a companyneeds to hold on to its employees, it needs to build a strong bondingwith the employees. As we will see in the case of Office-Tiger discussedbelow, there is a need to instill pride in the employees. They need tobe shown that the work done by them is important. Also, work needs tobe shown in the form of challenge to the employee rather than just amonotonous routine work. Provide employee with ESOPs, which wouldgive them a feeling that they are working for themselves and that theyare an inseparable part of the company. iv.HRPractices HR is the most critical department in any BPO. While conducting therecruitment, it is in the hands of HR to bring the right kind of people.HR needs to identify the employees who would stick with the companyand not get the employees solely based on the qualifications andcommunication skills. Moreover, more diversity in the kind of employeehired needs to be brought so there is a diversified culture within thecompany. Companies need to look to hire from non metro cities as theemployees from these cities are more likely to stay with the companythan those from metros. Also, they need to keep an eye on goodperforming employees and have a career plan in mind. Not only this,they need to discuss it with these employees on a regular basis andtake feedback from them. They also need to give their employeespersonal space to grow and adjust with social life. Moreover, in case of employees leaving a good exit-feedback system should be in place soas to cover the reason for which the employees leave. v.Considerfeedback It is important to take feedback from employees through differentmeans and work with the HR department to iron out differences. 26 Feedback can be got in two waysduring the employees tenure, andthrough exit interviews. Inputs can be secured from existing employeesthrough various employee relationship management tools. Exitinterviews help management learn the reasons why employees

leavethe company; based on their revelations, the organization can addressthe problems of existing employees, thereby curb attrition. vi. Quality of work life The success of any organization depends on how it attracts recruits,motivates, and retains its workforce. Organizations need to be moreflexible so that they develop their talented workforce and gain theircommitment. Thus, organizations are required to retain employees byaddressing their work life issues. The elements that are relevant to an individuals quality of work lifeinclude the task, the physical work environment, social environmentwithin the organization, administrative system and relationshipbetween life on and off the job. The basic objectives of a QWL program are improved workingconditions for the employee and increase organizationaleffectiveness.Providing quality work life involves taking care of the followingaspects: a) Occupational health care: The safe work environment 27 provides the basis for the person to enjoy working. The workshould not pose a health hazard for the person. The employer andemployee, aware of their risks and rights, could achieve a lot intheir mutually beneficial dialogue. b) Suitable working time: Organizations are offering flexiblework options to their employees wherein employees enjoy flexi-timings for dedicating their efforts at work. c) Appropriate salary: The appropriate as well as attractivesalary 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 stickwith the company for long.QWL consists of opportunities for active involvement in groupworking arrangements or problem solving that are of mutualbenefit to employees or employers, based on labor managementcooperation. People also conceive of QWL as a set of methods,such as autonomous work groups, job enrichment, and highinvolvement aimed at boosting the satisfaction and productivity

of workers. It requires employee commitment to the organization andan environment in which this commitment can flourish.Providing quality at work not only reduces attrition but also helps inreduced absenteeism and improved job satisfaction. Not only doesQWL contribute to a company's ability to recruit quality people, butalso it enhances a company's competitiveness. Common beliefssupport the contention that QWL will positively nurture a moreflexible, loyal, and motivated workforce, which are essential in 28 determining the company's competitiveness. 9). Transparent work culture A transparent work environment can serve as one of the primarytriggers to facilitate accountability, trust, communication,responsibility, pride and so on. It is believed that in a transparentwork culture employees rigorously communicate with their peersand exchange ideas and thoughts before they are finally maturedin to full-blown concepts. It induces responsibility amongemployees and accountability towards other peers, which graduallybuilds up trust and pride. More importantly, transparency in workenvironment discourages work-politics which often hinderscompany goals as employees start to advance their personalobjectives at the expense of development of the company as asingle entity.Employees comprise the most vital assets of the company. In awork place where employees are not able to use their full potentialand not heard and valued, they are likely to leave because of stress and frustration. In a transparent environment whileemployees get a sense of achievement and belongingness from ahealthy work environment, the company is benefited with astronger, reliable work-force harboring bright new ideas for itsgrowth. 29 10). Office-Tiger: A Role Model BPO to Follow According to Office-Tiger model it tries is to instill a sense of pridein its employees. Make the employees feel proud of doing the workthey do. Every project given to them is converted to a challengewhich drives away the monotony that creeps into the job. Everyemployee is given a feel that the work given to him or her is veryimportant. Moreover, there

should be a rigorous recruitmentprocess. After that the employees undergo an induction programwhere they hone their various skills. Employees work on liveprojects and if, during their project work, they feel that someimprovement is needed, they can go back to that stage of training. This helps the employee continuously improve himself. Also,employees are given encouragement to become Financial Analystsor Research Analysts. 11) Communication Communication is a process in which a message is conveyed tothe receiver by the sender. The message may be or may not be ina common format or language that both the sender and receiverunderstand. So there is a need to encode and decode themessage in the process. Encoding and decoding also helps in thesecurity of the message. The process of communication isincomplete without the feedback. 30 3). FEED BACK SYSTEMCommunication is the solution to almost everything in this 31 world. Same applies to employee retention also.Straight-from-theshoulder communication iswhat the employees need from their employers. Employees lookfor organizations where communication and process aretransparent. Nothing is hidden and shared with the employees. Communication mediums Open door policy: Organizations should support open doorpolicies so that the employees feel comfortable and areable to express their doubts and feeling to their employers. Frequent meetings and Social gatherings Emails, Newsletters, Intranet and many moreSo there should be effective communication across theorganization and this communication should be twoway.Communication alone can lead to unimaginable heights of employee retention. 32

INITIATIVES TAKEN BY OTHER COMPANIES TOREDUCE ATTRITION ICICI OneSource has introduced a career diversificationprogramme whereby employees who have been with thecompany for more than 18 months can switch to positions in theICICI group after passing internal tests. Company officials pointout that the objective of this policy is to ensure that future growthof employees is getting due consideration from the seniormanagement. Also it highlights that skills learnt in the BPOindustry such as customer friendliness and rapid response tocustomer problems have wider applications in today'scompetitive markets. Neil soft , they have crche facilities within the companypremises, and they have trained teachers to look after youngchildren. Company officials highlight that women in the age group28-35 are increasingly selecting the BPO industry as a preferred 33 career choice and as these employees have young children itbecomes necessary for companies to provide adequate facilities Wipro's Spectra mind has introduced medical insurance fortheir employees and they also provide 24-hour medical facilitiesfor employees. Tran works Information Services and Zenta Technologies which are already providing accommodation to their senior staff are contemplating this for lower level staff. It could also includepaying the entire deposit amount for flats or a certain percentageof the registration fees. Apart from improving long-term workprospects, HR managers are providing life enhancers in the formof community or sporting activities in a bid to improve staff morale. E-Funds International

the company is focusing on social andsporting events such as organizing six-a-side soccer games andcricket matches. Federal Express in India believes in spotting talent early andinvesting in it. Employees with leadership or managementpotential are identified and training programmes are held toimprove their skills. They are then assigned senior managementpositions. Rewarding merit in this way improves the image of theworkplace among the employees. Also in place at FedEx areonline platforms for employees to raise issues or complaints. Thisensures no issue takes an unpleasant shape or is blown out of proportion. 34 Intel Technology has a direct communication programmerunning, wherein the president, Intel Technology India, is meetingall the employees face to face in small groups. The CEO alsomaintains accessibility through blogging. They have an internalcommittee to ensure retention of highly qualified employees byoffering them alternative groups to work in. Also, consultantswere hired to find jobs in other organizations for the employeeswho were made to leave the company. Adobe India promotes the spirit of research by giving moral andfinancial support to employees who have business ideas. Thecompany then decides whether or not to approve the idea. If theidea is successful, the company absorbs it into its business; elsethe employee goes back to the usual job. The programme isextremely popular among the employees, and fresh ideas comein daily IBM executive MBA programmes and Web based learning toolshelp in training the employees to be better managers. Also thecompany sends the senior level employees to Wharton, Stanfordand Harvard. It also has an

anonymous feedback programme(one of the first of its kind in the country), through which theemployees can give feedback freely. 35 INTERPRETATIONANDANALYSIS Reason 1: Demand is more than supply: there is no dearth of graduates and plus two pass but the supply of people with Englishspeaking ability in this category is not adequate. Strategy : Constantly identify talent, recruit and train either in-house if scale of operations permit that or through an outsourced trainingagency in case of smaller operations. Reason 2 : People are joining with a short-term view and as a steppingstone to something else. Strategy: Create a culture and work environment that encouragespeople to think of a call center job as a long-term career option. Usecounseling by HR and line management. This has to be backed up bydemonstrated and perceived efforts by the management to move upthe value chain so that employees can clearly see that themanagement is making efforts to create opportunities for upwardmobility among employees. Reason 3: A lot of young people are taking up call center jobs just toearn some money on the side and not as a serious and long-termcareer option. 36 Strategy : Create a culture and work environment that encouragespeople to think of a call center job as a long-term career option. Usecounseling by HR and line management. Again this has to be backedup management efforts to move up the knowledge continuum in termsof the processes handled. Reason 4

: Long-term or intangible or contingency benefits such as PFor medical coverage do not have much attraction for call centeremployees as they want everything in cash. Strategy : Redesign the compensation package for call centeremployees and try to pay as much as possible in hard cash. Work out if necessary a new pay structure highly skewed towards cash benefits. Reason 5 : Call center employees have an average age profile of 20-24years, so they are highly emotional, impulsive and immature whentaking career decisions. Strategy: Constant counseling. R a e o s n 6 : low company morale. Strategy: following steps can be taken up by the HR department inorder to satisfy their employees.4). MOTIVATING EMPLOYEES 37 Conclusion With the strong growth expected in the Indian economy going ahead, itis clear that human resources will be the key competitive advantage if the country has to sustain this robust growth. Tackling attrition is not 38 an easy task and the strategies suggested in the report a r e n o t exhaustive to retain the hu man cap ital of BPOs. Th ese are just th e basics and if implemented in a proper way can give good Results, but itc a n o n l y b e c o m e e f f e c t i v e w h e n b o t h e m p l o y e e & e m p l o y e r understand the importance of these precautionary measures & continuously follow them only then this emerging & growing sectorwill give its proper results. 39 Recommendations

After a detailed analysis of both the industries we find that a key stepin designing an effective retention strategy is to ensure you have theright tools to gauge employee engagement. Investing in themeasurement of employee engagement is a key element of buildingthe type of highperformance culture that drives business. According tothe study, regular or formal employee interaction with managers andinteraction with human resources are the two most common ways of gauging engagement levels in organizations. We recommend thefollowing points to be followed: Good organizational behavior Recognizing the contribution of outstanding achievers also inspiresothers to try hard and put in their best. A good organizational behavioralso focuses on areas like training, career development and believe inequipping workforce better on the professional front. Goodorganizational behavior is instrumental in extending the tenure of employees in the organization as it increases their selfesteem,confidence, morale and motivation. A substantial growth of employee'sself-esteem is as important as the concept of learning in the industry.Otherwise, pharmaceutical organizations will meet a sorry fate as faras retention policies are concerned. Salary structure 40

Basic (54%), HRA (26%), Medical Reimbursement (8%), Management Supplement (12%), PF Contribution (actual),

Tiffin Allowance (Rs 25-30 per day of attendance), Attendance Bonus (Rs 500-1000 per month), Loyalty Bonus (1 months salary after completion of each year inthe company), Performance Incentives (linked to specific performance criteria), Referral Allowance (Rs 2000-3000 per candidate referred andrecruited). The EEE-Model Exposure, Experience and Education are three things which are vital toany employee in any sector or industry. These needs of the employeesare needed to be taken care of for an employee to feel motivatedAn employee expects the company to give him good exposure in thekind of work he is doing. Not only this, he needs to get a goodexperience working in the company from its top management andcolleagues. Monthly dinner with CEO of bonding programs with theother employees of the BPO would be a good idea.Also, some employees aspire for higher education to increase theirknowledge base. Some partnership with management institutes forshort courses needs to be provided. Alternatively, company can bearall the cost of further education for its good performing employees. 41

5). EEE MODEL Methods to relieve stress Stress is important from the point of view of retention andproductivity. Consequently, company can:

Organize events such as picnics, dance parties, get-togethers, cultural evenings, quizzes and games andoutdoor sports and games. Appoint professional agencies to organize regular stints of aerobic exercises and dancing sessions for employees aspart of stress management. 42

BIBLIOGRAPHY www.citeman.com www.naukrihub.com www.pharmainfo.net www.pharmaceutical-drug-manufacturer.com www.investopedia.com The Hindu 14 July 2008, Monday, business (newspaper). Hewitts attrition and retention report 2006... Stephens Robbins, Organizational behavior, Pearson education( 2008) ,page 234. 43

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