In today’s competitive business landscape, organisations strive to maintain a high-performance culture, foster growth and maximise productivity. One aspect that plays a crucial role in achieving these objectives is attrition — the natural process of employees leaving and new talent joining an organisation.
While attrition is inevitable, the way it is managed can significantly impact an organisation’s success. Positive attrition, also called voluntary attrition, in particular, where individuals willingly choose to leave, holds distinct advantages over involuntary attrition.
As Anil Mohanty, senior HR leader, puts it, “If the employees who are not performing up to the mark, walk out voluntarily, it benefits the organisation and the employee as well. The organisation can get someone who will be more aligned with its values and culture, and the individual will also be free to look for a space that matches his/her values,” shares Mohanty. ” It becomes a challenge only when the employees being asked to resign are not prepared for it. Then it can have unintended consequences such as disruptions in the form of server shutdowns. It can even be difficult for the affected individuals to find immediate opportunities elsewhere, causing them to struggle with their personal responsibilities and financial commitments.
“Companies strive to maintain and cultivate a high-performance culture, which is crucial in today’s business environment. To achieve this, it is essential to have high-performing and high-potential individuals as part of the organisation.”
Praveen Purohit, deputy CHRO, Vedanta Resources
“As HR professionals, it is not our intention to hire employees with the expectation of eventually asking them to resign. Our goal is to hire individuals who meet specific criteria and contribute to the company’s growth and automation processes. We prefer that employees stay with us and experience personal and professional growth alongside the company,” asserts Mohanty.
“Indeed, if positive attrition occurs voluntarily, it is generally considered the most favourable outcome,” admits Sunil Singh, founder, Mindstream. This generally suggests that the organisation has taken all necessary steps and made efforts to address performance issues or communicate the need for improvement to the individual. However, if despite these efforts, the person is not responsive for various reasons, their decision to leave, whether voluntarily or involuntarily, can have a positive effect. It is preferable if the departure happens voluntarily, as it indicates that the employees concerned have made their own decision to pursue other opportunities or align with a different path.
Praveen Purohit, deputy CHRO, Vedanta Resources, reveals, “Voluntary attrition happens in two ways — general attrition and regrettable attrition. I always prioritise keeping the number of regrettable attritions low. If I have high-performing and high-potential employees leaving, it becomes a problem for me, while general attrition is natural and normal, and plays a vital role in an organisation’s growth.”
“Voluntarily-driven positive attrition helps organisations replace an individual with a better-suited person, which ultimately helps improve the quality of the team.”
Sunil Singh, senior HR leader and founder, Mindstream Consulting
Employers aim to implement policies, programmes and initiatives that reduce regrettable attrition, with the goal being to focus on retaining and supporting the growth of all high-potential employees. “As long as I can retain them and help them progress in their careers, I am content. The overall level of general attrition does not concern me as much,” Purohit admits.
While attrition is usually seen as a challenge for companies, positive attrition can provide several benefits and is viewed as vital for the organisation in various ways:
Talent refreshment: “Voluntarily-driven positive attrition helps organisations replace an individual with a better-suited person, which ultimately helps improve the quality of the team,” asserts Singh. It allows companies to bring in new talent with fresh perspectives, ideas and skills.
High-performance culture: “Companies strive to maintain and cultivate a high-performance culture, which is crucial in today’s business environment. To achieve this, it is essential to have high-performing and high-potential individuals as part of the organisation,” points out Purohit. Therefore, the key objective of positive attrition is to ensure the presence of such individuals in the workforce or team.
Better team dynamics: There are instances when someone may not settle well within the team, leading to disturbances in team dynamics. In such cases, the decision to part ways with that individual becomes beneficial. “It helps improve the overall team environment, productivity, alignment and even client relationships,” points out Singh.
“As HR professionals, it is not our intention to hire employees with the expectation of eventually asking them to resign. Our goal is to hire individuals who meet specific criteria and contribute to the company’s growth and automation processes. We prefer that employees stay with us and experience personal and professional growth alongside the company.”
Anil Mohanty, senior HR leader
Cultural fit: Positive attrition can help create a more cohesive work environment by allowing individuals who are better suited to the company’s culture to join the organisation. ‘If there are low performers or non-performers who do not contribute positively or fit well with the company culture, it makes sense for them to move on. This can actually be beneficial for their own career development. It is a win-win situation, with the leaving employees being able to find environments where they align culturally, feel comfortable and can contribute value effectively,” opines Purohit.
Reputation and employer branding: Positive attrition can reflect positively on a company’s reputation and employer branding. When employees voluntarily leave to pursue better opportunities, it can be a testament to the company’s ability to attract and develop talent and is ideal for any organisation.
“Even if the decision is based on valid reasons, such as poor performance or organisational restructuring, there can still be a perception of victimisation or sympathy towards the individual being asked to leave. This sympathy can arise even when everyone acknowledges that the person was a poor performer,” points out Singh.
All the leaders agree that attrition that appears voluntary is always preferable, as it aligns with the desired outcome. Involuntary attrition, on the other hand, can negate the positive impact of even legitimate decisions made for organisational or political reasons. It is important to note that organisations do not hire people with the intention of firing them later. Moreover, not everyone possesses full context or complete knowledge of individual performance. Consequently, the lack of complete information can lead to doubts and suspicions regarding the fairness or arbitrariness of such decisions.
Depending on the specific cause that triggers the decision, there can be multiple positive outcomes resulting from this type of attrition. However, sometimes, an individual’s performance can be affected by certain circumstances and also the lack of support from managers. For instance, when evaluating an individual, we consider the person’s past performance, recognising that he/she may be a non-performer in the current role but was successful in previous positions. The shortfall or failure in performance could’ve happened due to the employee’s job role not matching the current profile perfectly.
“Each situation is unique, and it cannot be assumed that someone will always excel or forever underperform in every organisation. The environment, support, as well as training and development provided by the organisation greatly influence an individual’s performance. Sometimes, due to a lack of conducive conditions, even a previously high-performing individual can become a non-performer,” asserts Mohanty.
Therefore, it is essential for the organisations to acknowledge that a person’s performance can vary based on their strengths and the tasks they are assigned. Just because someone may be underperforming in one area does not mean they are incapable of delivering in a different capacity.
Moreover, the positive benefits derived from attrition are significantly greater when it occurs voluntarily. In the case of involuntary attrition, the benefits often get nullified. However, even when planning to part ways with individual voluntarily, it is important to try to convince them and help them see that they may be better off in another opportunity or organisation.
“The aim is not to hide the intention to terminate someone’s employment, but rather to fulfil a moral duty to acknowledge that the current situation did not work out. It is crucial for the organisation to take some responsibility,” points out Singh. After all, the individual may not be the sole reason. The situation may be the result of the surrounding environment. “The organisation should handle the situation carefully and consider outplacement options, as doing so can lead to greater benefits and preserve the organisation’s reputation. This perspective also applies to the image of the organisation as a whole,” concludes Singh.
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