EMPLOYEE RETENTION

Preface
The objective of the thesis is To study employee retention, identify areas of excellence and areas needing improvement; and provide suggestions for such improvement. The aim of this Thesis is to implement strategies successfully, analyze their working and performance, and highlight where they are doing well, while providing suggestions and recommendations for improvement. Employee retention is very important to study because to survive in such a competitive market is very difficult without the permanent support of an employee that is to retain employee.

EMPLOYEE RETENTION

GROUP MEMBERS
NAME
ANSARI IRSHAN ANSARI SALMAN ATHANIA MOHAMMED ANSARI TEHSIN SHAIKH ALTAMASH SHAIKH MISBAH KONKARE NEHA

ROLL NOS 112 113 114 115 116 117 118

SIGNATURE

High performers are like frogs in a wheelbarrowThey can jump out at any time
-Mc Kinsey & Company Study.

EMPLOYEE RETENTION

Contents
Serial number
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Topics
Introduction to retention Employee retention Importance of employee retention What makes employee leave Employee retention strategies Retention determinants Manager role in retention Retention myths Benefits of attrition Retention success mantras Employee turnover Ways to reduce employee turnover Facts about employee turnover Importance of relationship in employee retention program How to increase employee retention HR management employee retention Employees satisfaction regarding monetary benefits provided by the company How to improve employee retention 3 categories of employee Managing employee retention Implement retention strategy Case study1 Case study2 Conclusion Bibliography

27) 28) 29) 30) 31) 32) 33) 34)

EMPLOYEE RETENTION

INTRODUCTION TO RETENTION
Executive Summary 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 organiz ation 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, rel iable 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 harboring bright new ideas for its growth
Genius begins and labor finishes is an old saying that would be profoundly significant if interpreted in the context of corporate and large employers. Concepts, visions and decisions do take shape within the four walls of corporate boardrooms. However, it is only the employees that implement and give tangibility to the corporates mission. In other words if it is the highest rung in the corporate hierarchy that has ideas, it is the employees rung that has the chisel to bring the vision to life. In the best of worlds, employ ees would love their jobs. Like their co -workers, work hard for their employers; get paid well for their work, ample chances of advancement and flexible schedules so they could attend to personal or family needs when necessary. And never leave.

EMPLOYEE RETENTION
But then theres the real world. And in the real world, employees, do, leave, either because they want more money, hate the working conditions, hate their co -workers, want a change, or because their spouse gets a dream job in another state. Unlike inanimate products and systems that subject themselves to fine tuning without any reaction, employees would not subject themselves to any measure taken without reaction and analysis. Hence managing human resources, particularly retaining them, is an art that calls for special skills and strategies.

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 turnov er 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 employe es, why is retention so important? Is it just to reduce the turnover 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, s tock options, bonuses, vacations, etc. While setting up the packages, the following components should be kept in mind: Salary and monthly wage: It is the biggest component of the compensation package. It is also the most common factor of comparison among employees. It includes

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y and wages re resent the level of sll and e erience an individual has Time to time increase in the salaries and wages of employees shouldbe done And this increase should be based on the employees performance and his contribution to the organization. Bonus  Bonuses are usually given to the employees at the end of the year or on a festival. Economic benefits  It includes paid holidays leave travel concession, etc.Long-term incentives  Long term incentives include stoc options or stoc grants. These incentives help retain employees in the organization's startup stage. Health insurance  Health insurance is a great benefit to the employees. It saves employees money as well as gives them a peace of mind that they have somebody to take care of them in bad times. It also shows the employee that the organization cares about the employee and its family. After retirement: It includes payments that an Employee gets after he retires like EP F (Employee Provident Fund) etc. Miscellaneous compensation: It may include employee assistance programs (like psychological counseling, legal assistance etc), discounts on company products, use of a company cars, etc.

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EMPL YEE RETENTION

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. Hiring knowledgeable people for the job is essential fo r an employer. But retention is even more important than hiring. There is no dearth of opportunities for a talented person. There are many organizations which are looking for such employees. If a person is not satisfied by the job hes doing, he may switchover to some other more suitable job. In todays environment it becomes very important for organizations to retain their employees. The top organizations are on the top because they value their employees and they know how to keep them glued to the organization. Employees stay and leave organizations for some reasons. Emplo retention is a proess in whih the emploees are enouraged to remain with the organization for the maximum period of time or until the completion of the project  Emploee retention is beneficial for the organization as well as the emploee. The picture states the latest statement that corporate believes in Love them or lose them

The reason may be personal or professional. These reasons should be understood by the employer and should be taken care of. The organizations are becoming aware of these reasons and adopting many strategies for employee retention. 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. Retention involves fie major things:

  1 COMPEN ATION

 2 ENVIRONMENT

 3 GROWTH

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  4 RELATION HIP

 5 SUPPORT

Employee retention would reuire a lot of efforts, energy, andresources but the results are worth it.

EMPLOYEE RETENTION

IMPORTANCE OF EMPLO EE RETENTION

Now that so much is being done by organizations to retain its employees, why is retention so important? Is it just to reduce the turnover 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. The process of employee retention will benefit an organization in th e following ways: 1. The Cost of Turnover : The cost of employee turnover adds hundreds of thousands of money to a company's expenses. While it is difficult to fully calculate the cost of turnover (including hiring costs, training costs and productivity loss) , industry experts often quote 25% of the average employee salary as a conservative estimate. 2. Loss of Company Knowledge : When an employee leaves, he takes with him valuable knowledge about the company, customers, current projects and past history (sometimes to competitors). Often much time and money has been spent on the employee in expectation of a future return. When the employee leaves, the investment is not realized. 3. Interruption of Customer Service : Customers and clients do business with a company in part because of the people. Relationships are developed that encourage continued sponsorship of the business. When an employee leaves, the relationships that employee built for the company are severed, which could lead to potential customer loss. 4. Turnover leads to more turnovers : When an employee terminates, the effect is felt throughout the organization. Co -workers are often required to pick up the slack. The unspoken negativity often intensifies for the remaining staff. 5. Goodwill of the company : The goodwill of a company is maintained when the attrition rates are low. Higher retention rates motivate potential employees to join the organization. 6. Regaining efficiency: If an employee resigns, then good amount of time is lost in hiring a new employee and then training him/her and this goes to the loss of the company directly which many a times goes unnoticed. And even after this you cannot assure us of the same efficiency from the new employee.

EMPLOYEE RETENTION

WHAT MAKES EMPLO EE LEAVES?

Employees do not leave an organization without any significant reason. There are certain circumstances that lead to their leaving the organization. The most common reasons can be: Job is not what the employee expected to be: Sometimes the job responsibilities dont co me out to be same as expected by the candidates. Unexpected job responsibilities lead to job dissatisfaction. 1. Job and person mismatch: A candidate may be fit to do a certain type of job which matches his personality. If he is given a job which mismatches his personality, then he wont be able to perform it well and will try to find out reasons to leave the job. 2. No growth opportunities: No or less learning and growth opportunities in the current job will make candidates job and career stagnant. 3. Lack of appreciation: If the work is not appreciated by the supervisor, the employee feels de-motivated and loses interest in job. 4. Lack of trust and support in co -workers, seniors and management: Trust is the most important factor that is required for an individual to stay in the job. Non -supportive co-workers, seniors and management can make office environment unfriendly and difficult to work in. 5. Stress from overwork and work life imbalance: Job stress can lead to work life imbalance which ultimately many times lead to employee leaving the organization. 6. Compensation: Better compensation packages being offered by other companies may attract employees towards themselves. 7. New job offer: An attractive job offer which an employee thinks is good for him with respect to job responsibility, compensation, growth and learning etc. can lead an employee to leave the organization.

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The basic practices which should be kept in mind in the employee retention strategies are: 1. Hire the right people in the first place. 2. Empower the employees: Give the employees the authority to get things done. 3. Make employees realize that they are the most valuable asset of the organization. 4. Have faith in them, trust them and respect them. 5. Provide them information and knowledge. 6. Keep providing them feedback on their performance. 7. Recognize and appreciate their achievements. 8. Keep their morale high. 9. Create an environment where the employees want to work and have fun . These practices can be categorized in 3 levels: Low, medium and high level. <Low> <Medium > <High>

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RETENTION DETERMINANTS
It has been recognized by both employers and employees that some common areas affect employee retention. If certain organizational components are being provided, than other factors may affect retention. Surveys of employees consistently show that better compensation package and better career opportunity are the two most important determinates of retention. Finally, job design and fair and supportive employee relationship with others inside the organization contribute to retention. Following are the componen ts that affect employee retention: -

Career opportunities 1. Training Continuity. 2. Development & Mentoring. Rewards 1. Competitive pay & benefits. 2. Performance reward differentiation. 3. Recognition. 4. Special benefit & perks. Organizational Components 1. Values and Culture. 2. Strategies & Opportunities. 3. Well managed & results-oriented. 4. Job continuity & security.

Job design & work 1. Job responsibility & autonomy. 2. Work flexibility. 3. Working conditions. 4. Work/Life balancing.

Employee Relationship 1. Fair/nondiscriminatory treatment. These were determinants of retention. An affective leadership assumed by the top 2.the Supervisory/management management would be a very important feature that keeps the work force intact and loyal. support. In fact, the approach to the task of formulation of strategies for employee retent ion should 12

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be comprehensive and the honest intention of the employer to implement every stipulation in the package of appointment should be evident. However, there would, in each employing corporate, be a section of so-called good employees, whom it would be unwise to loose. Special strategies and special kind of efforts are re uired in the task of retaining them. Probably it would be the hardest task for the employer to retain them as persons and rivals would be making relentless bids to woo this sectionof employees. To counter these onslaughts from peers, special efforts are called for.

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MANAGER ROLE IN RETENTION

When asked about why employees leave, low salary comes out to be a common excuse. However, research has shown that people join companies, but leave because of what their managers do or dont do. It is seen that managers who respect and value employees competency, pay attention to their aspirations, assure challenging work, value the quality of work life and provided chances for learning have loyal and engaged employees. Therefore, managers and team leaders play an active and vital role in employee retention by creating a motivating team culture and improving the relationships with team members. This can be done in a following way: 1. Creating a Motivating Environment: Team leaders who create motivating environments are likely to keep their team members together for a longer period of time. Motivation does not necessarily have to come through fun events such as parties, celebrations, team outings etc. They can also come through serious events e.g. arranging a talk by the VP of Quality on career opportunities in the field of quality. Employees who look forward to these events and are likely to remain more engaged. 2. Standing up for the Team: Team leaders are closest to their team members. While they need to ensure smooth functioning of their teams by implementing management decisions, they also need to educate their managers about the realities on the ground. When agents see the team leader s tanding up for them, they will have one more reason to stay in the team. 3. Providing coaching: Everyone wants to be successful in his or her current job. However, not everyone knows how. Therefore, one of the key responsibilities will be providing coaching that is intended to improve the performance of employees. Managers often tend to escape this role by just coaching their employees. However, coaching is followed by monitoring performance and providing feedback on the same. 4. Delegation: Many team leaders and managers feel that they are the only people who can do a particular task or job. Therefore, they do not delegate their jobs as much as they should. Delegation is a great way to develop competencies. 5. Extra Responsibility: Giving extra responsibility to employees is another way to get them engaged with the company. However, just giving the extra responsibility does not help. The manager must spend good time teaching the employees of how to manage responsibilities given to them so that they dont feel o ver burdened. 6. Focus on future career: Employees are always concerned about their future career. A manager should focus on showing employees his career ladder. If an employee sees that his current job offers a path towards their future career aspirations, then they are likely to stay longer in the company. Therefore, managers should play the role of career counselors as well.

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RETENTION M THS
The process of retention is not as easy at it seems. There are so many tactics and strategies used in retention of employees by the organizations. The basic purpose of these strategies should be to increase employee satisfaction, boost employee morale hence achieve retention. But some times these strategies are not used properly or even worse, wro ng strategies are used. Because of which these strategies fail to achieve the desired results. There are many myths related to the employee retention process. These myths exist because the strategies being used are either wrong or are being used from a lon g time. These myths prevent the employer from successfully implementing the retention strategies. Let us have a look on some of these myths: 1. Employees leave an organi!ation for more pay: Money may be the motivating factor for some but for many people it is not the most important factor. Money matters more to the low-income-employees for whom its a survival issue. Money can make an employee stay in an organization but not for long. The fa ctors more important than money are job satisfaction, job responsibilities, and individuals skill development. The employers should understand this and work out some other ways to make employees feel satisfied. When employees leave, management tries to retain them by offering more money. But instead they should try to figure out the main reason behind it. Issues that are mainly the cause of dissatisfaction are organizations policies and procedures, working conditions, relationship with the supervisor and salary, etc. For such employees, achievement, growth, respect, recognition, is the main concern. 2. Incentives can increase productivity: Incentives can surely increase productivity but not for long term. Cash incentives, volume work targets and speed awards are old management beliefs. They can generate work speedily and in volumes but cant boost employee commitment. Rather speed can hamper the quality of work produced. What really glues employees to their work and organization is quality work, meaningful responsibilities, recognition, respect, growth opportunities and friendly supervisors. 3. Employees run away from responsibilities: It is a myth that employees run from responsibilities. In-fact employees feel more responsible if they are given extra responsibilities apart from their regular job. Employees look for variety, greater control on the processes and authority to take decisions in their present job. They want opportunities to learn and grow. Management can assign extra responsibilities to their employees and appreciate them on the completion of these tasks. This will induce a sense of pride in the employee and will improve the relationship between the management and the employee.

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4. Lo"alt" is a thing of the past: Employees can be loyal but what they need is an employer for whom they can be loyal. There is no reason for the employee to hop jobs if hes satisfied with the employer. 5. Taking measures to increase emplo#ee satisfaction will be expensi$e for the organizations: The things actually re%uired improving employee satisfaction like respect, career growth and development, appreciation, etc. cant be bought. They are free of cost. An employer or management that reacts well to the employees ideas and suggestions is enough for the employees to be retaine d.

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BENEFITS OF ATTRITION
Attrition is not bad always if it happens in a controlled manner. Some attrition is always desirable and necessary for organizational growth and development. The only concern is how organizations differentiate good attrition from bad attrition. The ter m healthy attrition or good attrition signifies the importance of less productive employees voluntarily leaving the organization. This means if the ones who have left fall in the category of low performers, the attrition in considered being healthy. Attrition rates are considered to be beneficial in some ways: 1. If all employees stay in the same organization for a very long time, most of them will be at the top of their pay scale which will result in excessive manpower costs. 2. When certain employees l eave, whose continuation of service would have negatively impacted productivity and profitability of the company, the company is benefited. 3. New employees bring new ideas, approaches, abilities & attitudes which can keep the organization from becoming stagnant. 4. There are also some people in the organization who have a negative and demoralizing influence on the work culture and team spirit. This, in the long -term, is detrimental to organizational health. 5. Desirable attrition also includes termination of em ployees with whom the organization does not want to continue a relationship. It benefits the organization in the following ways: y It removes bottleneck in the progress of the company y y It creates space for the entry of new talents It assists in evolving high performance teams

6. There are people who are not able to balance their performance as per expectations, lack potential for future or need disciplinary action. Furthermore, as the rewards are limited, business pressures do not allow the management to ove r-reward the performers, but when undesirable employees leave the company, the good employees can be given the share that they deserve. Some companies believe attrition in any form is bad for an organization for it means that a wrong choice was made at the beginning while recruiting. Even good attrition indicates loss as recruitment is a time consuming and costly affair. The only positive point is that the

realization has initiated action that will lead to cutting loss.

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ATTRITION RATES IN IN IA

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EMPLOYEE RETENTION

RETENTION SUCCESS MANTRAS

1) Transparent Work Culture
In todays fast paced business environments where employees are constantly striving to achieve business goals under time restrictions; open minded and transparent work culture plays a vital role in employee retention. Companies invest very many hours and monies in training and educating employees. These companies are severely affected when employees check out, especially in the middle of some big company project or venture. Although employees most often prefer to stay with the same company and use their time and experience for personal growth and development, they leave mainly because of work related stress and dissatisfactions. More and more companies have now realized the importance of a healthy work culture and have a gamut of people management good practices for employees to have that ideal fresh work-life. Closed doors work culture can serve as a deterrent to communication and trust within employees which are potential causes for work -related apathy and frenzy. A transparent work environment can serve as one of the primary triggers to facilitate accountability, trust, communication, responsibility, pride and so on. It is believed that in a transparent work culture employees rigorously communicate with their peers and exchange ideas and thoughts before they are finally matured in to full -blown concepts. It induces responsibility among employees and accountability towards other peers, which gradually builds up trust and pride. More importantly, transparency in work environment discourages work-politics which often hinders company goals as employees start to advance their personal objectives at the expense of development of the company as a single entity. 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 harboring bright new ideas for its growth.

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2) 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: 1. 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 pe rson. The employer and employee, aware of their risks and rights, could achieve a lot in their mutually beneficial dialogue. 2. Suitable working time: Organizations are offering flexible work options to their employees wherein employees enjoy flexi -timings for dedicating their efforts at work. 3. 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 competitor s 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. People also conceive of QWL as a set of methods, such as autonomous work groups, job enrichment, and high -involvement aimed at boosting the satisfaction and productivity of workers. It requires employee commitment to the organization and an environment in which this commitment can flourish. Providing quality at work not only reduces attrition but also helps in reduced absenteeism and improved job satisfaction. Not only does QWL contribute to a company's ability to recruit quality people, but also it enhances a company's competitiveness. Common beliefs support the contention that QWL will positively nurture amore flexible, loyal, and motivated workforce, which are essential in determining the company's competitiveness.

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3) Supporting Employees
Organizations these days want to protect their biggest and most valuabl e asset and they want to do this in a way that best suits their organizational culture. Retaining employees is a difficult task. Providing support to the employees acts as a mantra for retraining them. Employers can also support their employees by creating an environment of trust and inculcating the organizational values into employees. The management can support employees directly or indirectly. Directly, they provide support in terms of personal crises, managing stress and personal development. Management can support employees, indirectly, in a number of ways as follows: 1. Manage employee turnover : Employee turnover affects the whole organization in terms of productivity. Managing the turnover, hence, becomes an important task. A proactive approach can be adopted to reduce attrition. Strategies should be framed in advance and implemented when the times arrives. Turnover costs should also be taken into consideration while framing these strategies. 2. Become employer of choice : What makes a company an employer of choice? Is the benefit it offers or the compensation packages it gives away to its employees? Or is it measured in terms of how they value their employees or in terms of customer satisfaction? Becoming an employer of choice involves following a road map which tells where to go as a brand. 3. Engage the new recruits : The newly hired employees are said to be least engaged in the organization. Keeping them engaged is an important task. The fresh talent should be utilized to maximum before they start feeli ng bored in the organization. 4. Optimi&e employee engagement : An organizations productivity is measured not in terms of employee satisfaction but by employee engagement. Employees are said to be engaged when they show a positive attitude toward the organi zation and express a commitment to remain with the organization. Employee satisfaction also comes with high engagement levels. So, organizations should aim to maximize the engagement among employees. 5. Coaching and mentoring : Employees whose work performance suffers due to poor interpersonal relationships or because of lack of interpersonal skills should be provided proper coaching by their superiors. Planed coaching sessions help an individual to work through issues, maximize his potential and return to pea k performance.

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4) 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 dissatisfaction. However, negative feedback sometimes make employee to put more efforts to improve his performance. But such times are very rare. Moreover this improvement is short term. Some managers do not provide any kind of feedback to their employees. Due to no feedback, employees may assume that they are performing productively or they may feel that the manager is satisfied with their performance. Studies reveal the performance tends be same or even decreases if no feedback is provided. Thus, feedback is necessary because: 1. It builds trust and enhances communication between manager and employee. 2. It gives managers and employees a way to identify and discuss skills and strengths. 3. Positive feedback leads to employee retention and motivation. 4. It helps in identifying performance areas that need improvement and specific ways to improve them. 5. It acts as an opportunity to enhance perf ormance by identifying resources for skill development. 6. It is an opportunity for managers and employees to assess and identify career and advancement opportunities. 7. 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 de-motivate 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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5) Communication between Employee and Employer

Communication is the solution to almost everything in this world. Same applies to employee retention also. Straight-from-the-shoulder communication is what the employees need from their employers. Employees look for organizations where communication and process are transparent. Nothing is hidden and shared with the employees. Communication is also the way to win the employees trust in the organizatio n. Employees trust the employers who are friendly and open to them. This trust leads to employee loyalty and finally retention. Employers also feel that the immediate supervisors are the most authenticated and trusted source of information for them. So the organizations should hire managers who are active communicators. Communication mediums 1. Open door policy: Organizations should support open door policies so that the employees feel comfortable and are able to express their doubts and feeling to their employers. 2. Frequent meetings and Social gatherings 3. Emails, Newsletters, Intranet and many more. So there should be effective communication across the organization & this communication should be two-way. Communication alone can lead to unimaginable heights of employee retention.

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EMPLO EES TURNOVER

Employees turnover 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. A formula had to be devised keeping in view the na ture 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.

Employees Turnover rate or Attrition rate means: In terms of numbers:

Total number of resigns per month (whether voluntary or forced) divided by (Total Number of employees at the beginning or the month plus total number of new joiners minus total number of resignations) multiplied by 100.

If calculating in monetary terms, it includes the following: Costs Due to a Person Leaving
1. Calculate the cost of the person(s) who fills in while the position is vacant. Calculate the cost of lost productivity at a minimum of 50% of the person s compensation and benefits cost for each week the position is vacant, even if there are people performing the work. Calculate the lost productivity at 100% if the position is completely vacant for any period of time. 2. Calculate the cost of conducting the exit interview to include the time of the person conducting the interview, the time of the person leaving, the administrative costs of stopping payroll, benefit deductions, benefit enrollments. 3. Calculate the cost of the manager who has to understand what work remains, and how to cover that work until a replacement is found. 4. Calculate the cost of training your company has invested in this employee who is leaving. 5. Calculate the impact of departmental productivity because the person is leaving. Who will pick up the work, whose work will suffer, what departmental deadlines will not be met or delivered late. 6. Calculate the cost of lost knowledge, skills and contacts that the person who is leaving is taking with them out of your door. Use a formula 50& of th e persons annual salary for one year of service, increasing each year of service by 10%. 7. Subtract the cost of the person who is leaving for the amount of time the position is vacant.

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Recruitment costs
1. The cost of advertisements; agency costs; employee costs; Internet posting costs. 2. The cost of internal recruiters time to understand the position requirements, develop and implement a sourcing strategy, review candidates backgrounds, prepare for interviews, conduct interviews, prepare can didate assessments, conduct reference checks, make the employment offer and notify unsuccessful candidates. This can range from a minimum of 30 hours to over 100 hours per position. 3. Calculate the cost of the various candidate pre-employment tests to help assess candidates skills, abilities, aptitude, attitude, values and behaviors.

Training costs
1. Calculate the cost of orientation in terms of the new persons salary and the cost of the person who conducts the orientation. Also include the cost of orientati on materials. 2. Calculate the cost of departmental training as the actual development and delivery cost plus the cost of the salary of the new employee. Note that the cost will be significantly higher for some positions such as sales representatives and call center agents who require 4-6 weeks or more of classroom training. 3. Calculate the cost of the person(s) who conduct the training. 4. Calculate the cost of various training materials needed including company or product manuals, computer or other technology equipment used in the delivery of training.

Lost productivity costs

As the new employee is learning the new job, the company policies and practices, etc. they are not fully productive. Use the following guidelines to calculate the cost of this lost productivity: 1. Upon completion of whatever training is provided, the employee is contributing at a 25% productivity level for the first 2 -4 weeks. The cost therefore is 75% of the new employees full salary 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 during that time period. 3. During weeks 13-20, the employee is contributing at a 75% productivity level. The cost is therefore 25% of full salary during that time perio d. 4. Calculate the cost of mistakes the new employee makes during this elongated indoctrination period.

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New Hire Costs

1. Calculate the cost of bring the new person on board including the cost to put the person on the payroll, establish computer and security p asswords and identification cards, telephone hookups, cost of establishing email accounts, or leasing other equipment such as cell phones, automobiles. 2. Calculate the cost of a managers time spent developing trust and building confidence in the new employ ees work.

Lost Sales Costs

1. Calculate the revenue per employee by dividing total company revenue by the average number of employees in a given year. Whether an employee contributes directly or indirectly to the generation of revenue, their purpose is to p rovide some defines set 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 per employee.

The cost of employees turnover or attrition is: (Total staff * employees turnover rate/attrition rate %) * (annual salary * 80%)
The rule of thumb appears to be very inaccurate indeed and, while it depends upon the category of staff, it is probably better to estimate around 80% of salary as a truer rule of thumb- and this will be on the conservative side. What kind of strategies would be effective in producing the desired results of maximum Employee Retention and minimum Employee Turnover ? The answer is obvious. It should be the aim of each employee to keep his work force fully satisfied with no room for disgruntlement. Retention of employees has become a primary concern in many organizations foe several reasons. As a practical matter, with lower turnover, every individual wh o is retained means one less person to have to recruit, selects, and trains. Also, the continuity employees who know their job, co -workers, organizational services and products and firms customers enhance organizational and individual performance. One sur vey of supervisor and workers found that losing high performance made it more difficult for organizations to reach their business goals. Additional continuity of employees provides better Employee image for attracting and retaining other individuals.

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WA S TO REDUCE EMPLO EE TURNOVER

Following are some of the ideas to reduce employee turnover: 1. Hire the best candidate. 2. Welcome new employees. Customize your induction program for new employees according to the requirements. Same induction program can n ot be applied to all the candidates. Make them feel welcomed. 3. Produce quality managers who can really manage employees well. 4. Provide employees with work schedules that are flexible enough to suit their needs. 5. Dont be too demanding. You re hiring human beings who have their own life and family commitments. Respect them. 6. Provide career counseling and development. 7. Discuss your future plans regarding the candidate with the candidate. Let them know that the management is interested in retaining them and c ares for them. 8. Take proper feedback from employees regarding their grievances. 9. Remember your former employees. They can be helpful to you in future. It is also a part of employee retention.

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FACTS ABOUT EMPLO EE TURNOVER

It is difficult to accept when organizations say they have zero attrition rates. Companies may have healthier turnover rates, however, there is no such thing as zero attrition. There are other such facts about turnover, about which most of us are not aware . Some of such facts have been highlighted below: 1. Turnover always happens: Companies who believe in zero attrition rates only fool themselves. This happens because employees keep on moving due to reasons like marriage or further education. Nothing can stop these employees from moving on. So, rather than achieving zero attrition companies should focus on identifying whom they want to keep so that they have healthy attrition rate. 2. Some Turnover is Desirable: Zero attrition is not desirable mainly because o f two reasons. Firstly, if all employees continue to stay in the same organization, most of them will be at the top of their pay scale which will result in excessive manpower costs. Secondly, new employees bring new ideas, approaches, abilities & attitudes which can keep the organization from becoming stagnant. 3. Turnover includes costs: Turnover always includes some costs. Consider the costs of replacing the key employee who falls in to the category of high performers. This includes the costs of recruitmen t advertisement, referral bonuses, selection testing, training costs, etc. Moreover, turnover results in loss of time & efforts, low productivity, loss of morale, loss of knowledge and so on. 4. High salary doesnt work: Most managers assume that a high salary package is enough to keep employees loyal to their organization. Employees may face other problems like low job satisfaction, low engagement levels, no recognition, poor working conditions, less support from superiors and so on. Salaries are not always the solution to attrition. Managers should try to identify y the roots of the problem and then find a feasible solution. 5. The manager can reduce attrition: Managers should take primary responsibility for retaining their employees. Much of the employees p erception of job satisfaction stems from the relationship they share with their immediate supervisor. Managers should try to support their subordinates and give proper feedback on performance. HR managers should work in collaboration to make the key employ ees last in their organization. 6. Reducing Turnover takes Commitment: Reducing turnover takes an investment in coaching, developing, motivating, mentoring & listening to people. There should be universal acceptance of the goal of reducing turnover along wi th top management commitment and dedication.

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Importance of Relationship in Employee Retention Program

Retention Home Relationship Sometimes the relationship with the management and the peers becomes the reason for an employee to leave the organizati on. The management is sometimes not able to provide an employee a supportive work culture and environment in terms of personal or professional relationships. There are times when an employee starts feeling bitterness towards the management or peers. This b itterness could be due to many reasons. This decreases employees interest and he becomes de -motivated. It leads to less satisfaction and eventually attrition.

A supportive work culture helps grow employee professionally and boosts employee satisfaction. To enhance good professional relationships at work, the management should keep the following points in mind. Respect for the individual: Respect for the individual is the must in the organization. Relationship with the immediate manager: A manger plays the role of a mentor and a coach. He designs ands plans work for each employee. It is his duty to involve the employee in the processes of the organization. So an organization should hire managers who can make and maintain good relations with their subordinates. Relationship with colleagues: Promote team work, not only among teams but in different departments as well. This will induce competition as well as improve the relationships among colleagues. Recruit whole heartedly: An employee should be recruited if there is a proper place and duties for him to perform. Otherwise hell feel useless and will be dissatisfied. Employees should know what the organization expects from them and what their expecta tion from the organization is. Deliver what is promised. Promote an employee based culture: The employee should know that the organization is there to support him at the time of need. Show them that the organization cares and hell show the same for the organization. An employee based culture may include decision making authority, availability of resources, open door policy, etc. Individual development: Taking proper care of employees includes acknowledgement to the employees dreams and personal goals. Cr eate opportunities for their career growth by providing mentorship programs, certifications, educational courses, etc. Induce loyalty: Organizations should be loyal as well as they should promote loyalty in the employees too. Try to make the current emplo yees stay instead of recruiting new ones.

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How To Increase Employee Retention

Companies have now realized the importance of retaining their quality workforce. Retaining quality performers contributes to productivity of the organization and increases morale among employees. Four basic factors that play an important role in increasi ng employee retention include salary and remuneration, providing recognition, benefits and opportunities for individual growth. But are they really positively contributing to the retention rates of a company? Basic salary, these days, hardly reduces turnover. Today, employees look beyond the money factor. employee retention can be increase by inculcating the following practices: Open Communication: A culture of open communication enforces loyalty among employees. Open communication tends to keep employees informed on key issues. Most importantly, they need to know that their opinions matter and that management is 100% interested in their input. Employee Reward Program: A positive recognition for work boosts the motivational levels of employees. Recognitio n can be made explicit by providing awards like best employee of the month or punctuality award. Project based recognition also has great significance. The award can be in terms of gifts or money. Career Development Program: Every individual is worried abo ut his/her career. He is always keen to know his career path in the company. Organizations can offer various technical certification courses which will help employee in enhancing his knowledge. Performance Based Bonus: A provision of performance linked bon us can be made wherein an employee is able to relate his performance with the company profits and hence will work hard. This bonus should strictly be productivity based. Recreation facilities: Recreational facilities help in keeping employees away from str ess factors. Various recreational programs should be arranged. They may include taking employees to trips annually or bi -annually, celebrating anniversaries, sports activities, et al. Gifts at Some Occasions: Giving out some gifts at the time of one or tw o festivals to the employees making them feel good and understand that the management is concerned about them.

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Human Resources Management - Employee Retention

Directory A best-of-breed in staff retention Staff turnover can cost companies dearly. Learn about one telecommunications giant's best-of-breed staff retention approach and the many ways it's paying off for both the staff and the company. Bankruptcy Key employee retention plans (KERP), employee retention and bankruptcy: Balancing stakeholder interests. Employee Retention People Leave Managers, Not Companies: How To Increase Employee Retention Employee Retention - Talent Management Retaining employees involves understanding the intrinsic motivators of them which many organizations unable to i dentify. In this context organizations need to dig novel approaches to retain the most effective manpower. Employee What?! Introductory chapter, that will: Look at exactly what employee retention is and examine three trends that are currently shaping employee retention strategies. Employer Attitude - The Foundation of Employee Retention One of the foundation stones of companies which attract, retain and motivate high performing employees is a positive and valuing attitude toward them. Keeping a cut above the rest - Employee retention strategies Rather than fight a futile war for talent, leaders should build talent by looking within their organisations for the critical skills, knowledge and attributes required to execute their company's most i mportant roles. Key Employee Retention Bonuses: An Uncertain Future? Retention bonuses in the context of bankruptcy: Retention bonuses, also known as pay -to-stay bonuses, have become common practice since the early 1990's and have been heralded by court s, debtors, and creditors alike as an important and useful way to help reorganization by maintaining those most valuable employees. Managing Employee Retention as a Strategy for Increasing Organizational Competitiveness Research indicates that the total cost of employee turnover is about 150% of an employees salary. Because of this high cost of turnover, the organization that is the focus of this article sought to understand their employees turnover intentions and the reasons for the potential turnover. Retaining Talent: A Benchmarking Study Executive Summary of a study. This study examines the challenges that organizations face with employee retention in an increasingly competitive labor market. Retention success tied to money, but it's much more than salaries There's no denying that money keeps tech staff in their current jobs, but competitive salaries aren't the lone factor in reducing turnover. As this case study illustrates, other uses of the money are also very effective. Understand Why Employees Come and Why They Stay How long do you think good, talented people stick around at places that treat them like draftees? Not long. David Russo explains why employees are your most valuable asset -- by far. This chapter is from the book 17 Rules Successful Companies Use to Attract and Keep Top Talent: Why Engaged Employees Are Your Greatest Sustainable Advantage

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Voluntary turnover.Losing too many of your keepers? The question is, why are some of our best employees choosing to leave and what is be ing done? Why Do People Leave? Most of us believe our employees leave us for money reasons. How many times have you said, If only I could have paid her more, she would have stayed. Yes, youve lost people because of money, but the majority of contempor ary research finds that people leave for one major reason and several subordinate ones. Love 'em or Lose 'em: Getting Good People to Stay by Beverly Kaye , Sharon Jordan-Evans Because finding the ideal person for every workplace position has become an in creasingly difficult task, the retention of top employees has become every manager's concern. This bookproposes that this "race for talent" can be effectively run only by those who adopt programs and policies that truly support their personnel. It then sho ws how to do so, even in organizations reluctant to participate actively.

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EMPLO EES SATISFACTION REGARDING MONETAR BENEFITS PROVIDED B THE COMPAN .

Retention Management
Abstract: Background: retention management is a highly topical subject and an important dilemma many organizations might face in the future, if not facing it already. We believe that the leader plays a key role in employee retention and retention management. The concept of retention management can both have a narrow, and a broader significance. Both parts of its significance are generally included in this thesis. The background of the thesis present a few articles that discuss issues that makes it important for the organization, and the leaders, to work hard with retention management. The research is based on the leaders in the Finnish case company Tradeka. 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 qualita tive, as well as a theoretical study where empirical findings and theories has been compared. The intention of investigating and using the Finnish company Tradeka 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 Tradeka?s financial department, both with supervisors and employees to get a broader view at the phenomenon retention management. Result: Leaders and their skill in creating a culture of retention, has becoming a key in why people stay and what usually drives them away from a company. The leader has become the main factor in what motivates peoples decision to stay or leave. For organizations to keep its key employees their number one priority should be to look at their management, because people leave managers and not companies. Characteristics in a leader that are of importance, as the leader plays a key role in retention management is: trust builder , esteem builder, communicator, talent developer and coach, and talent finder. The leaders relation to the employees plays a central role in retaining employees, because employees need to feel involvement, and that their presence count. When retention is a core value, good things happen for customers, employees, and the company.

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How to Improve Employee Retention

People want to enjoy their work so make work fun and enjoyable. Understand that employees need to balance life and work so offer flexible star ting times and core hours. Provide 360 feedback surveys and other questionnaires to foster open communication. Consider allowing anonymous surveys occasionally so employees will be more honest and candid with their opinions. Provide opportunities within th e company for career progression and cross-training. Offer attractive, competitive benefits and 401(k)s.

Organizations should target job applications for employees who have characteristics that fit well with the organizational culture. Upon conducting an interview, seek out traits, such as loyalty. Also, ask the potential employee what motivates them on the job. Having more information about the potential employees expectations can help retain them, should they get hired into the company. Rewards and Recognition Employees want to be recognized for a job well done. Rewards and recognition respond to this need by validating performance and motivating employees toward continuous improvement. Rewarding and recognizing people for performance not only affects the person being recognized, but others in the organization as well. Through a rewards program, the entire organization can experience the commitment to excellence. When the reward system is credible, rewards are meaningful; however, if the reward system is broken, the opposite effect will occur. Employees may feel that their performance is unrecognized and not valued, or that others in the organization are rewarded for the wrong behaviors. Unrecognized and nonvalued performance can contribute to turnover. Recognition for a job well done fills the employees' need to receive positive, honest feedback for their efforts. Need for Rewards and Recognition Recognition should be part of the organization's culture because it contributes to both employee satisfaction and retention. Organizations can avoid employee turnover by rewarding top performers. Rewards are one of the keys to avoiding turnover, especially if they are immediate, appropriate, and personal. A Harvard University study concluded that organizations c an avoid the disruption caused by employee turnover by avoiding hiring mistakes and selecting and retaining top performers. One of the keys to avoiding turnover is to make rewards count. Rewards are to be immediate, appropriate, and personal. Organizations may want to evaluate whether getting a bonus at the end of the year is more or less rewarding than getting smaller, more frequent payouts. Additionally, a personal note may mean more than a generic company award. Employees should be asked for input on th eir most desirable form of recognition. Use what employees say when it comes time to reward for performance (St. Amour, 2000). Designing a Rewards and and Recognition Solution

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In designing a rewards and recognition program, the following guidelines should be considered. Rewards should be visible to all members of the organization. Rewards should be based on well -defined, credible standards that have been developed using observable achievements. Rewards should have meaning and value for the recipient. Rewards can be based on an event (achieving a designated goal) or based on a time frame (performing well over a specific time period). 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. Rewards should be achievable and not out of reach by employees. Nonmonetary rewards, if used, should be valued by the individual. For example, an avid camper might be given a 10-day pass to a campsite, or, if an individual enjoys physical activity, that employee might be given a spa membership. The nonmonetary rewards are best received when they are thoughtfully prepared and of highest quality. Professionalism in presenting the reward is also interpreted as worthwhile recognition. Rewards should be appropriate to the level of accomplishment received. A cash award of $50 would be inappropriate for someone who just recommended a process that saved the organization a million dollars. Determining the amount of money given is a delicate matter of organizational debate in which organizational history, financial parameters, and desired results are all factors. Recognition for a job well done can be just as valued and appreciated as monetary awards. Formal recognition program can be used with success. First Data Resources, a data processing services company that employees more than 6,000 individuals in Omaha, Nebraska, uses a formal recognition program (Adams, Mahaffey, and Rick, 2002). Rewards are given on a monthly, quarterly, and yearly basis, and range from Nebraska football tickets, gift certificates, pens, plaques, mugs, and other items. One of the most popular awards at First Data is called the "Fat Cat Award" that consists of: $500 gift check Professional portrait of the employee Appreciation letter from the CEO and senior management E-mails, phone calls, and notes from peers In addition to nonmonetary rewards, employees can be rewarded using money in numerous ways. Cash is a welcome motivator and reward for improving performance, whether at formal meetings or on the spot. Variable bonuses linked to performance are another popular reward strategy. Profit sharing and pay -for-skilis are monetary bonus plans that both motivate individuals and improve goal achievement. Small acts of recognition are valuable for employee daily Retention. Sometimes a personal note may mean more than a generic company award. In one survey, employees cited the following as meaningful rewards (Moss, 2000):

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Employee of the month awards Years of service awards Bonus pay (above and beyond overtime) for weekend work Invitations for technicians to technical shows and other industry events Meaningful and Retentional Rewards What gives meaning to rewards and recognition? What makes them eff ective? First, rewards and recognition should be based on a clear set of standards, with performance verifiable or observable. The standards for the reward should also be achievable. If the reward is based on an unachievable result, such as a production goal that is beyond employees' power, then those employees will not be motivated. Meaningful rewards and recognition that are achievable have the greatest impact.

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There are 3 categories of employees:

A: Who will leave their current employer in 3 years o f their employment B: Who have a probability of leaving their current employer in next 3 years C: Who will stay with their current employer in the next 3 years Category A: These are the employees who lack communication with their employers.Category C: Thes e are the employees who have proper, well structured communication with their employers.Communication is also the way to win the employees trust in the organization. Employees trust the employers who are friendly and open to them. This trust leads to emplo yee loyalty and finally retention. Employers also feel that the immediate supervisors are the most authenticated and trusted source of information for them. So the organizations should hire managers who are active communicators.Communication mediums Open door policy: Organizations should support open door policies so that the employees feel comfortable and are able to express their doubts and feeling to their employers. Frequent meetings and Social gatherings Emails, Newsletters, Intranet and many more So there should be effective communication across the organization and this communication should be two -way. Communication alone can lead to unimaginable heights of employee retention.

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Managing Employee Retention

The task of managing employees can be understood as a three stage process: 1. Identify cost of employee turnover. 2.Understand why employee leave. 3.Implement retention strategies The organizations should start with identifying the employee turnover rates within a particular time period and benchmark it with the competitor organizations. This will help in assessing the whether the employee retention rates are healthy in the company. Secondly, the cost of employee turnover can be calculated. According to a survey, on an average, attrition cos ts companies 18 months salary for each manager or professional who leaves, and 6 months pay for each hourly employee who leaves. This amounts to major organizational and financial stress, considering that one out of every three employees plans to leave h is or her job in the next two years. Understand why employees leave : Why employees leave often puzzles top management. Exit interviews are an ideal way of recording and analyzing the factors that have led employees to leave the organization. They allow an organization to understand the reasons for leaving and underlying issues. However employees never provide appropriate response to the asked questions. So an impartial person should be appointed with whom the employees feel comfortable in expressing their opinions.

Implement retention strategy :

Once the causes of attrition are found, a strategy is to be implemented so as to reduce employee turnover. The most effective strategy is to adopt a holistic approach to dealing with attrition. An effective ret ention strategy will seek to ensure: Attraction and recruitment strategies enable selection of the right candidate for each role/organization New employees initial experiences of the organization are positive Appropriate development opportunities are av ailable to employees, and that they are kept aware of their likely career path with the organization The organizations reward strategy reflects the employee drivers

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CASE STUDY 1
Kei Hiring Solutions Package greatly improves recruiting results and saves client $64,000 in first 12 months. SITUATION For three consecutive years, this 100 employee financial services client was experiencing above industry average employee turnover, so a formal internal committee had been established to address the problem. The President assigned the goal of reducing their turnover rate to a level that was ten percentage points below the industry average. Committee members had conducted an employee survey and were seeking expert advice for interpreting the survey results prior to taking corrective action. Two committee representatives enrolled to attend KEi's spring 1999 employee retention seminar, after which KEi made a presentation to the full turnover committee and the President, who then engaged th e services of KEi to support the committee efforts. ACTION KEi employee retention specialists gathered essential background information from the committee members and reviewed the results from the recently completed employee survey. A series of specific action steps were recommended that would prioritize the client's employee retention initiatives and generate the greatest return on investment. Step one created an employee satisfaction gap analysis using KEi's online automated tool for gathering input from a representative cross section of the workforce. The data collection time requirement per employee was only 15 minutes. This tool asked employees to rate the most critical areas where they need to be supported if they are to achieve individual jo b success. It also asked employees to rate how well this client was providing these support needs to their employees. The resulting gaps between the importance ratings and the support provided ratings highlighted employee dissatisfaction and pointed to the sources of turnover vulnerability. Step two introduced Behavioral Competency Interviewing to all supervisors and managers. One full day of training was delivered that introduced them to KEi's tool for identifying the Behavioral Competencies that lead to long-term
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success in each of the clients job categories. They also learned the techniques for conducting effective behavior-based interviews that gain proof of job applicant abilities. Step three was the implementation of KEi's online Attitude/Behavior scr eening questionnaire for screening applicants in the highest turnover job categories. This tool allowed the Human Resources staff to efficiently eliminate nearly one-third of job applicants who did not match the company culture. Prior to using this tool, these misfits were getting through initial screening and were included in the more costly phases of the interview process. In some cases, their "interviewing talents" were even getting them hired. Step four implemented KEi's online Background Verification t ool. This tool moved the client from a source taking 4-5 days for turnaround to a source that delivered results in 1-2 days. RESULT The Human Resources department, for the first time, was able to ensure that all supervisors used a common, reliable process for interviewing job applicants and selecting which candidates to hire. The supervisors applauded the significantly improved screening processes that Human Resources now used to screen out the misfits so that their valuable interviewing time and money was no longer wasted. Documented savings from the implementation of these tools showed a Return on Investment ratio of 4:1, translating to $64K saved in the first year.

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Case Study 2
August 2002 KEi Attitude/Behavior screening saves client $60,000 on $2,500 investment. SITUATION This health services client has 300 employees, 200 of which are in a high turnover job category. The turnover rate for this group was twenty percentage points above the industry average. Considerable time and money was being spent interviewing and orienting applicants who when offered employment would not show up on the first day of work. KEi was engaged to reduce the cost of this unwanted turnover. ACTION The client agreed to refine the applicant scree ning process. KEi recommended adding a standardized approach to screen-in only those candidates who match the basic attitude and behavioral criteria that is required to be successful in this work category. KEi coached the client in the selection of the app ropriate combination of KEi's web-based attitude/behavior screening questionnaires to be given to all job applicants as one of the earliest steps in the screening process. The Human Resources staff had no difficulty implementing the online questionnaires and the time required for each applicant to complete them was only 15 to 20 minutes. Secure, confidential results of the scoring were available to the Human Resources representative immediately after each applicant finished answering the final question. The client was instructed in the interpretation of the score and to use the score as one of several criteria for making their ultimate hiring decisionnever saying to an applicant that they were not being hired because of the questionnaire score. The client measured the success of this screening process by conducting an internal comparison of the actual performance record of those hired that had been scored RECOMMENDED by the screening questionnaire vs. those that had been scored NOT RECOMMENDED.

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RESULT
After six months of implementing the online screening questionnaire, more than one-third of all applicants had received NOT RECOMMENDED scores. 66% of the RECOMMENDED candidates were still working vs. 47% of the NOT RECOMMENDED candidates. 6.5% of those RECOMMENDED did not finish orientation or did not show up for work vs. 40% of those NOT RECOMMENDED. 2.5 % of those RECOMMENDED had later been dismissed for cause vs. 13% of those NOT RECOMMENDED. In the second six-month period, the client stopped hiring applicants with a NOT RECOMMENDED or a MARGINAL score. This saved a considerable HR department time that was re-directed to other priority duties. The investment of less than $2,500, that paid for the cost of the questionnaires plus the time of the HR administrator, returned a savings of more than $60,000 by eliminating the orientation for those applicants who received a NOT RECOMMENDED score. This translates to an impressive Return on Investment ratio of 24:1. In addition to these continuing financial benefits that the client enjoys, improved employee morale was evident due to reduced frustration with the performance of new recruits.

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Conclusion
Retention is an important concept that has been receiving considerable attention from academicians, researchers and practicing HR managers. In its essence, Retention comprises important elements such as the need or content, search and choice of strategies, goal-directed behavior, social comparison of rewards reinforcement, and performancesatisfaction. The increasing attention paid towards Retention is justified because of several reasons. Motivated employees come out with new ways of doing jobs. They are quality oriented. They are more productive. Any technology needs motivated employees to adopt it successfully. Several approaches to Retention are available. Early theories are too simplistic in their approach towards Retention. For example, advocates of scientific Management believe that money is the motivating factor. The Human Relations Movement posits that social contacts will motivate workers. Mere knowledge about the theories of Retention will not help manager their subordinates. They need to have certain techniques that help them change the behavior of employees.One such technique is reward. Reward, particularly money, is a motivator according to need based and process theories of Retention. For the behavioral scientists, however, money is not important as a motivator. Whatever may be the arguments, it can be stated that money can influ ence some people in certain circumstance. Being an outgrowth of Herzbergs, two factor theory of Retention, job enrichment is considered to be a powerful motivator. An enriched job has added responsibilities. The makes the job interesting and rewarding. Job enlargement refers to adding a few more task elements horizontally. Task variety helps motivate job holders. Job rotation involves shifting an incumbent from one job to another.

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BIBLIOGRAPHY
www.google.com www.scribd.com www.yahoo.com

a2zmba.blogspot.com hrmba.blogspot.com mbafin.blogspot.com

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