Winning The War For Talent
The average voluntary attrition for the IT & IT-BPM industry has increased from 19 per cent in 2018 to 21 per cent in 2019 By Sunil Bablani & Ayush Khaitan
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The IT & IT-BPM industry in India has over the years tried to pivot the image of being a cost-effective service-provider to one of building cutting-edge products. This is due to the increased demand for advanced tools and technologies relating to Blockchain, IoT, Artificial Intelligence & Machine Learning and Robotic Process Automation amongst others. The development has ensured a higher focus on re-skilling employees and developing a talent pool which can deliver solutions in such niche technologies.
This year, employees in Best IT & IT-BPM Workplaces spent an average of 123 hours on training as compared to 93 hours last year. However, investments towards training remain almost the same, signifying that the organizations are moving from traditional classroom-based modes to E-learning and MOOC’s.
The average voluntary attrition for the IT & IT-BPM industry has risen from 19 per cent in 2018 to 21 per cent in 2019. With an increased emphasis on training employees, it is imperative for organizations to retain their skilled talent now more than ever. The best workplaces are still ahead of the game as they enjoy the advantage of lower reported attrition of 19 per cent as against 23 per cent in the rest. It is however clear that the war for talent is heating up.
The Great Place to Work® survey provides insights into what encourages employees to stay with an organization for a long time. Our research reveals that at any point in time, an organization has employees in one of the four zones of retention:
High Trust Retention: Employees have an intent to stay for a long time and have a positive perception of Workplace culture
Prisoners at Work: Employees are willing to work with their organization for a long time yet are disconnected from the culture
Flight Risk: Employees are disconnected from the culture and do not intend to stay for a long time
Tourists: Employees like the culture but may not be fully invested.
We observe that in the best workplaces, 78 per cent of employees say they experience a High-Trust High-Retention culture as against 63 per cent in the Rest. However, the reduction in the percentage of Prisoners at Work from 8 per cent in 2018 to 3 per cent in 2019 in the Best Workplaces and from 14 per cent to 6 per cent in the Rest Workplaces, leads the reader to speculate — Could the increase in reported voluntary attrition be attributed to an increasing demand for skilled talent in the industry, thus opening up many more lucrative opportunities for employees seeking a change?
What drives high-trust retention?
In order to understand what drives high-trust retention, it is important to understand what connects people to an organization’s culture. We set out to find answers to the following questions:
What are the basic employee experiences expected by the talent in the IT & IT-BPM sector?
Our analysis reveals that environmental factors such as non-discrimination, good facilities, fun at work and work-life balance have come to characterize workplace culture in this sector. These, in turn, have become basic expectations/hygiene factors to be met by organizations interested in attracting talent. However, while the presence of these alone will not enhance employee retention, the absence of them results in disengagement.
Should organizations focus on retention or engagement through a high-trust culture?
The IT & IT-BPM sector continues to be a growing industry that offers lucrative opportunities to talented job seekers. Given the dynamic nature of technology, the demand for relevant skilled talent currently surpasses the supply. While organizations are increasingly focused on re-skilling and developing their existing talent, trying to control attrition is akin to fighting a losing battle. In a market where there is an ongoing talent war, an organization may not have a chance to respond to the ‘Flight Risk’ employee’s concerns and engage them in time.
To establish a clear competitive advantage in the talent market, would require an organization to have a great employer brand, backed by internal advocates for the company culture. Beyond just controlling attrition, IT & IT-BPM organizations need to look at how they can engage the hearts and minds of employees to make them significant contributors of innovation and excellence and move out of a ‘Prisoner at Work’ mindset to that of ‘high-trust retention’.
What differentiates employees in a ‘Prisoner at Work’ zone as against those that report a ‘high-trust retention’ experience?
The analysis reveals that employee perception in the following areas stands out as differentiators:
Fairness: Fairness in performance evaluations, promotions, pay and avoiding favouritism at the workplace is a key differentiating factor for high-trust retention employees.
Career Growth & Development: These may be attributed to opportunities for growth, development for leadership positions and factors such as hiring and fitment, where high-trust retention employees perceive their organization to be remarkably better.
Management Reliability & Competence: This refers to the management’s ability to walk the talk, involving employees in decision making, demonstrating care, and providing candid communication.
With rapid advancements in technology and the changing business environment, it is imperative for the IT & IT-BPM industry and its business leaders to not only facilitate the re-skilling of their employees but also focus on avenues where they can be engaged to be meaningful contributors to the organization. It is not the overall attrition that the organizations should be worried about; but instead focus on engaging their people to put in discretionary efforts and be active advocates of the organization. Employees also need to adapt to the dynamic nature of the industry and have a conscious awareness regarding the continous pursuit to enhance their skills.
Providing great facilities, fun at work and work-life balance have become hygiene factors and can no longer guarantee employee retention. It has become vital for organizations to focus on continuous employee experiences. Every interaction between the management and the employees has become a Moment of Truth and plays a key role in driving employee perception. Our study reveals that those managers who demonstrate fairness and reliability and support the development and career growth of employees will be most successful in retaining and engaging their talent. The war for talent will be won by those organizations that have a great workplace culture supported by leaders and managers who actively contribute to making it a Great Place to Work®.