19-09-2014, 03:20 PM
Empirical Study on Addressing High Employee Attrition in BPO Industry
Focusing on Employee Salary and other Factors in Karnataka and Kerala
States of India
Empirical Study.pdf (Size: 112.14 KB / Downloads: 77)
Abstract
Globally competitive organizations will depend on the uniqueness of their human resources and the systems for managing
human resources effectively to become successful. Outsourcing is a management process in the globalized business context
that has been well understood, tried and tested by successful organizations across the world. The issue of employee attrition/
turnover has been found to be making huge economic impact on the Business Process Outsourcing organizations located in
the states of Karnataka and Kerala. The present study aimed at addressing high employee attrition in the above sector by
identifying the Critical Factors which causes high attrition. The data has been collected through a structured questionnaire
survey. The study identified 13 factors affecting high employee attrition in BPO industry using Factor Analysis. Also multiple
regression analysis was applied to analyze the collected data. It is found that the attrition factor employee’s salary has
emerged as the most critical factor affecting high attrition in the BPO sector of the above two states.
Conclusion
Business Process Outsourcing, commonly known as BPO, is
one of the most booming sectors in the Indian industry. Since its
inception, the Indian BPO industry has grown at a constant
annual rate of 40-50 per cent and within a couple of years, India
managed to secure the position of the most preferred and low
cost destination for business process outsourcing. Ironically, in
spite of the tremendous growth potential of the sector, attrition
rate and the manpower crisis is dampening the growth of the
sector. The human resource professionals of the BPO industry
are facing various challenges like the attrition rates and its
implications, skill shortages, retaining the employees etc. In
order to implement successful business strategies to face these
global challenges, organizations must ensure that they have the
right people capable of delivering the strategy. The topic for this
research study has been identified in this context. This study
will be helpful to the management of BPOs located in Karnataka
and Kerala states to focus on the critical factors identified in the
study in addressing the employee attrition problem. In the study,
the attrition factor, employee’s salary has been emerged as the
most critical factor affecting high attrition in the BPO
companies. It further clarifies the need to pay immediate
attention on introducing highly competitive salary packages in
BPO sector organizations for addressing the high attrition
problem. It is revealed that both in Karnataka and Kerala states,
absence of good HRM practices is also one of the critical factors
causing high attrition. BPO management also has to ensure that
their employees are paid enough for the work they do in the
organization in which they are working.
BPO industry is one of the prominent sectors in both the states
of Karnataka and Kerala which need to be protected from
serious issues for its survival and growth! BPOs have a great
scope in India. Around 5 years back, BPOs were just a means by
which companies could save costs. Only a few activities were
outsourced. But now BPOs are emerging as a management tool
and focus is shifting from non-core processes to core processes.
Business process outsourcing is considered as the inevitable
next major source of innovation and competitive advantage.