Sunday, March 27, 2016

Why People Leave?

Below is a fictionalized case study that presents dilemma faced in real organizations. And written by me is the recommended solution to the problem. This has been published in Business Manager Magazine March 2016 edition. 

Arvind Suiting’s a global textile company is based in India. The company has presence in more than 35 countries. It has succeeded in getting a decent share in an increasingly competitive global market. It has employed more than 5,800 employees. This company always views its employees as its strength and as the secret of its success. It has got several HR practices oriented towards employee satisfaction and motivation. The uniqueness of the HR practices of this company are (i) its accent on extensive training programme for its employees during their probationary period of two years and (ii) its compensation packages, which are excellent for the industry. The HR department of the company is managed by Mr Ravi Varma, a post graduate in Human Resource Management.

However, the company has been plagued by quite a few HR-related problems in the recent past. One of them is the high rate of attrition witnessed by the company, especially among the employees promoted to the higher position in the organization. Some other recently promoted employees were asking for reversals to their original position. Apparently, the company was perplexed by the developments as the employee leaving the organization were indeed performing activities critical to the organization. The company took the matter seriously and was determined to identify its reason. It appointed a team of HR experts to look into the issue and suggest necessary remedial measures.

The team approached all the employees who were leaving the organization and conducted an exit interview to ascertain the reason for their quitting the firm. It also interviewed the employees who applied for reversals to their previous positions. Similarly, it interviewed all the existing employees in that cadre as on that date. Finally, it went a step ahead and contacted the employees who had already left the company in the recent past and elicited their views on the different aspects of employment and the reason for leaving.

Shockingly, almost all the employees spoke negatively about their job. They also informed the team about the presence of an anomaly in authority, responsibility and accountability. A number of them perceived a lack of fit between the level of authority and responsibility. They opined that the job carried too huge a responsibility but provided little authority for the job holder. They also revealed that the lack of demarcation of job authority of different employees often led to misunderstanding and quarrels with their subordinates. Several employees felt that the compensation package was not commensurate with the difficulty and accountability of the job. Based on its interviews with the present and former employees, the team of HR experts prepared a report and presented it to the top management. The report squarely blamed the job analysis report (that had been made earlier) and the resultant HR practices as responsible for the present situation. It held the job analysis report as poorly investigated and drafted. The HR manager was asked to respond to the report and present his own report about the situation. In his report, the HR manager cited the lack of cooperation of the employees for job analysis exercise as the reason for inaccuracies in the job analysis report. However, he strongly defended the methods and techniques adopted in the job analysis process.

Finally, the company decided to undertake a fresh job analysis for all job titles and integrate the information with the HR practices by revising these practices thoroughly. An external HR consultancy agency with relevant expertise in job analysis was hired this time to prepare the job analysis report even though it charged a high fee.

Question for Discussions:
  1. How do you view the developments in Aravind Suitings from your perspective?
  2. Do you agree with the findings of the team of HR professionals regarding the recent spate in employee resignations and requests for reversal?
  3. What is your response to the report of the HR manager Mr. Ravi Varma blaming employees for the defective job analysis report?
  4. Do you have any alternate suggestions for controlling attrition in Aravind Suitings?
Solutions:

Arvind Suitings, an Indian textile company having 5800 employees & a global presence in more than 35 countries views its employees as its assets and key to business success. The objective of it’s HR practices are employee satisfaction & motivation resulting into the company having extensive training for it’s employees who are on probation and excellent compensation packages that are the best in the industry. Recently, the company is facing a challenge that of employees leaving the company especially those promoted to higher positions or employees asking for reversal to original position.  The company appointed a team of expert consultants to look into the matter and based on extensive interviews with different cadres of employees by they found ambiguity in job profile as one of the main reasons. Job responsibilities and authorities were not properly defined and the pay offered was perceived to be less as compared to the huge amount of responsibility it carried. The HR Manager Mr. Ravi Varma cited lack of co-operation of the employees when carrying out the job analysis exercise for the inaccuracies.

Employees and first-line supervisors who are closest to the work usually understand best what skills are required (and missing) to do the work effectively. Failure to obtain and use input from these employees may result in the development of inappropriate or ineffective training opportunities and it’s resultant application on the job. This is exactly what has happened at Arvind Suitings & has led to waste of its Human Resources. Although the HR Manager has cited lack of co-operation by the employees, it is HRD’s responsibility to get the work done properly and implement it effectively. Simply blaming the employees as an excuse cannot be tolerated as they have their own line functions also to look into.

Has the HR Manager Mr. Ravi Varma communicated to the employees the objective of the job analysis exercise? Has it been perceived rightly by all the employees? Incase of improper communication, employees may take it in wrong sense and start looking out for other options. If the HR Manager spoke about lack of co-operation from the employees, he must realise that it is almost impossible to get real and genuine data without the support of employees. if they are not ready to co-operate, it is a sheer wastage of time, money and human effort to conduct job analysis process. The solution is that of taking the workers in confidence and communicating to them that it is being done to solve their problems only.

Companies must look at recruiting, hiring, placing, and retaining employees who will meet skill requirements required to position it for future success. Obviously the right employee is a key factor in this. This has also not quite exactly happened at Arvind Suitings resulting into employees leaving the organization or requesting for reversal to their original function.

If the HRD had indeed a problem in carrying out this exercise effectively, has it proactively communicated it to the Management of Arvind Suitings for their support. That could have eased out matters somewhat as compared to the current situation that the company is currently facing in having it reviewed by a team of external HR consultants and then appointing an external HR consultancy agency with relevant expertise in job analysis to prepare the job analysis report.

Alternative suggestions for controlling attrition in Arvind Suiting’s, one of them could be to have self-directed or self-managed work teams throughout the organization. They should be having authority over their relevant matters because this was the current problem faced. Secondly the HRD should conduct systematic job needs analysis to ensure that skills required to perform work are routinely assessed, monitored, and maintained. Employee opinion should be regularly sought (and obtained) regarding job design and their work process management and improvement. This should be a part of yearly routine activity with frequency to be defined.
 
Since Arvind Suitings has oriented its HR practices towards employee satisfaction and motivation and views extensive trainings as one of the indicators, it could systematically evaluate training effectiveness on the job. Performance data to be collected on all employees at all levels to assess the impact of training. Prompt and regular feedback should be provided to teams and individuals regarding their performance. Employee satisfaction with the courses to be tracked and used to improve training content & training delivery.
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