When office managers in India considered their budgets for 2005, what should they have invested in? The popular vote would have probably been for pool tables and cappuccino machines. What wouldn't have been top of the list is revolving doors. But with employees leaving, almost leaving, leaving and then returning, the dizzying churn in India Inc was more worthy of a few rounds in a revolving door.
By most reports, it will get worse before it gets better. According to a report by human resources consultancy Mercer, India will suffer 12.8 per cent voluntary attrition in 2006, a shade lower than 2005's 14.7 per cent...the highest in Asia.
With 88 per cent of Indian companies expected to recruit employees next year, 3 percentage points more than 2005's 85 per cent, the likelihood is that the churn will be even bigger.
It's not easy to quantify the cost of attrition - intangible costs form a fair percentage of the total - but nobody doubts that it is high. Various studies and HR consultants have made elaborate calculations that estimate the cost of replacing an employee at between one-and-a-half and two-and-a-half times his annual salary.
Obviously, then, it's better for an organisation if its employees don't make beelines for the exit. So, what does it take to persuade employees to stay on? Higher salaries, stock options and perks are obvious answers, but there's more.
For some time now, the BPO industry has been equating attrition with death and taxes: inescapable, and a part of life. But even as the industry shoots ahead at 40 to 50 per cent a year, it is now losing 35 to 40 per cent of its 350,000-odd employees as well. And that's making it sit up and take notice.
The BPO industry is caught in a trap of its own making: for some years now, outsourcing firms have been recruiting fresh graduates and 20-somethings by promising them a "fun" place to work.
That image has two problems: one, people soon realise that working shifts in a call centre is no party; two, as they grow older, their career goals move beyond having a good time. And call centres aren't seen as serious career options. Analysts estimate that more than half the employees who quit leave for better jobs, but close to 15 per cent leave to pursue their education.