Attrition

What is attrition means?

Attrition refers to the gradual loss of an organization’s human resources. This can mean lower revenue, decreased productivity, and an inability to fulfill its original mission. Attrition is an unavoidable part of running any organization but can be strategically managed depending on the business’s overall situation.

What is the attrition rate?

The employee attrition rate is used to estimate workforce turnover. If there is no attrition rate, there will be no staff change within the year. An organization should consider the fluctuation of its workforce by looking at the attrition rate and understanding why employees are leaving. The causes of employee turnover could be due to work satisfaction, revenue, or low salary. One way to reduce employee turnover is to invest in training programs or make profit-sharing available to the employees who are loyal to the company.

How do you calculate the attrition rate?

“The attrition rate measures how many people leave an organization in a given period. This can be calculated by the formula mentioned below:
Number of employees leaving within the month / Average number of employees x 100”

What are some reasons for attrition?

The reasons for attrition will vary depending on the circumstances. In the case of retirement, it is obvious, but redundancies are made because of company downsizing. Resignation at scale may be due to any number of reasons that include bad work-life balance, low pay scales, lack of skill development, and dissatisfaction with workplace conditions.

What are the different types of attrition?

There are two types of attrition in the recruitment industry. They are:

• Voluntary Attrition: This occurs when a candidate decides to leave voluntarily from the organization due to several reasons such as better job opportunities, relocation, monetary incentives, etc.
• Involuntary Attrition: This occurs when an employee is fired, laid off, or retrenched from the company for one reason or another. Downsizing is usually the most common reason for this type of attrition. Involuntary attrition can also occur due to other reasons such as resignation, retirement, and so on.

What is Customer Attrition?

Customer attrition is when customers leave a business or service all at once. With customer attrition, customers take their business elsewhere and, worse, tell others about their experience with the business. This may cause future customers to feel wary about using the same service or business that the previous customer used.

What is the difference between employee and customer attrition?

Employee attrition occurs when employees leave their jobs for various reasons. There could be multiple reasons for an employee to leave his job, such as working conditions, change in career path, or better salary offered by another company. Customer attrition occurs when customers choose not to purchase certain products or services from a particular company. Customer attrition may arise due to poor quality products, lack of customer service, and poor pricing, among others.

Is attrition good or bad?

The term ‘attrition’ is a word that refers to the voluntary or involuntary exit of an employee from an organization or business. In most cases, attrition is considered a bad thing. Incidents of attrition often lead to a decrease invaluable assets of the concerned organization. The loss of money, time, and deliverables can be detrimental to the functioning of the business.

How to Stop Attrition?

There are many things to stop attrition. But before that, you have to know why the attrition is happening in the first place. Some common ones are:
1. They feel they aren’t growing professionally.
2. The company culture is not healthy.
3. They don’t feel appreciated.
4. Compensation is not fair.
5. Benefits are not enough or not up to date.