How can You Reduce the Attrition Rate in Your Organization?

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As an HR, it will be one of the key responsibilities to have a high retention rate in your organization. Post-Pandemic a lot of organizations have witnessed great resignation, even though it is crucial to hire the best employees, it is also essential to pay attention to what makes employees leave an organization. A comprehensive understanding of the reasons behind attrition can give you valuable insight into your company’s culture, health, and prospects.

Attrition is defined as the process of reducing something’s strength or effectiveness through sustained attack or pressure. Employee attrition also follows the same process. The term employee attrition refers to the phenomenon of workers leaving the organization without prioritizing their replacement.

Do you see the resemblance between the definition of attrition and employee attrition?

Employees may resign for various reasons like retirement, internal attrition, voluntary attrition, and involuntary resignation but this affects the workflow of the remaining employees. The question is how can we minimize this?

In this blog, we dive into some of the best ways to reduce attrition and improve employee retention in your organization. Continue reading for a look at some of the best strategies industry leaders use to scale down their attrition rates.

1. Don’t compromise on the compensation

Research shows that if your compensation is even 10% lower than your competitors, there are higher chances that employees will opt for voluntary resignation. Benchmarking and salary banding can help you know the industry standard which will attract and retain the right talent in your organization.

2. Structured Retirement and Resignation Plans

It is always better to have an evaluation a few years ahead of time that who all are exiting from the organization in the next few years. It could be voluntary resignation, termination of employees who are not performing well. or retirement. This will give you time for hiring in advance as per the situation demands.

3. Professional recruitment strategy

Hiring is the new challenge post-pandemic. Finding the right candidate will help you stand the test of time and is really essential no matter which industry you belong to. Keeping up with the battle to find the top talent is not easy. In such scenarios department of human resource management plays a crucial role as they will have to implement professional recruitment strategies. Your description should contain unambiguous information, a valid task preview, and showcase the company’s values (strong employer brand via e.g., social media and website).

Have a clearly defined recruitment process that gives the candidate a transparent picture of the flow. Unclear processes lead to unpleasant onboarding and this forces them to look for alternatives. It is necessary to have a justifiable reason for working in a field that is not related to their own. Background checks should be conducted on jobs that deal with finances or tangible resources. 

If you still find recruitment a challenge, then you need an HR consultant and staffing company like Prompt Personnel that will not just help you hire better but also help you get verified candidates.

4. Job rotation within the same organization

As the employee evolves with time there is a change in their mindset which in turn leads to a change in career. After understanding the skill sets and the roles available in an organization it is beneficial to have job rotation in a defined duration across departments. This will reduce monotony, upskill employees, and keep them engaged in the organization for a longer duration.  Alternatively, consider giving some employees the privilege to switch across any department within the organization. This will not only give the employee the freedom to choose the career of their choice but will help reduce the amount of voluntary resignation and turnover rates. To ensure a smooth transition, human resource management should be involved in this process.

5. Train your Middle Managers

There is a famous saying, “People leave their bosses, not their job”. Statistics show that 92% of people resign from their jobs due to inappropriate behaviors of their reporting managers. It is important to sensitize leaders on people management skills, empathy, and work-life balance. Ensure that your middle managers and supervisors are properly trained to deal with their subordinates to reduce attrition.

6. Engaging Your Employees

Those bosses who know how to motivate their employees for even the most mundane tasks are true bosses. It is difficult to scale down employee turnover rates without practicing employee engagement. Practice having regular feedback sessions to evaluate the state of your employees.

There are employees who will engage in the activities within the organization activities and be in alignment with the company goals and values. But there are some who won’t be aligned with the company goals and values they are bad apples, and a disengaged employee may ruin everything around them. Those around him are likely to be negatively impacted by his actions. A disengaged workforce significantly contributes to the increased attrition rate.

Offer training seminars and short courses to improve your employees’ skills. It will not only reduce employee turnover but will also introduce your company to new talent.

7. Exit Interviews

A critical factor in reducing attrition rates is conducting exit interviews

So, what is an exit interview?

An exit interview is basically the communication between the HR of the organization and the employee who is exiting the organization after he/she has submitted the resignation. This will give you a brief insight into why the employees are exiting the company. The reason why they choose to quit can be different, but an exit interview will help you figure out the pattern that the employees tend to follow before they resign.

Exit role if taken seriously will substantially reduce the attrition rate

However, here’s a little pro-tip. For a successful exit interview, it is imperative to ask some impactful questions.

Sometimes the work culture or the management style in the organization doesn’t have anything to do with it. Sometimes an employee isn’t just the right fit. This also gives you an idea of how to enhance your hiring process.

Obviously, attrition costs a company a great deal of money. The costs of managing human resources are enormous. The real cost of attrition is calculated by how much it is going to cost your company to train the new employees because of retirement or resignation.

When the employee driving major revenue leaves the organization it is a huge setback for the organization. The blow happens when the employees leaving the company are the ones driving the revenue. As their replacements are hard to find, be sure to engage these employees successfully. It will take a considerable amount of time to get the replacement up to the same level even if you do find a suitable replacement.

Employee satisfaction and needs should be the primary focus of the company. You cannot eliminate the attrition completely. But you can minimize it by using the strategies we mentioned.

Finally, it should be clear that you value remaining employees and are focused on improving your bottom line.

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