Understanding Antecedents to Attrition for Employees with Varying Levels of Experience in Indian Software Industry Professionals

Article excerpt


Time and again the importance of human capital management in the service industries has been stressed upon and the attrition of employees has catched the fancy of researchers from decades. Keeping attrition at bay is a daunting task for most of the service industries and software industry in particular, where high quality knowledge workers are crucial for sustainable business operations and profitability. The Indian software industry is making great strides internationally because of its knowledge workers. Knowledge and expertise in different domains form the key factors in the software industry and the success of any software company depends on how efficiently it manages these assets. Being an employee centric industry, employee retention and eventually the retention of knowledge directly influences the growth trajectory of the company. A plethora of studies conducted in the past have thrown light on different issues and concerns related to attrition.

Extant literature underpins the importance of understanding reasons of attrition to device strategies for controlling attrition in organizations. Voluntary attrition of employees, which is persistent across the industry has now become an important concern to address, for maintaining a consistently performing workforce in the hostile marketplace. Post recession with improved economic conditions business growth has renewed, and these knowledge professionals are back in demand. The scales are tipped in their favor again and exalted competition is further increasing tug-of-war for talent on board. Outsourcing avenues and the astounding FDI are providing a new level of opportunities to these software professionals in India as well as in foreign countries. The snag of this increased competition is rising attrition rate which presents the company with unique challenge of sustaining client confidence especially where employees develop relationships with clients which is a common feature in software companies. When employees are not satisfied with their job they start exploring options in the market with a turnover intention and turnover intentions are strongly positively correlated with voluntary turnover (Chafetz et al., 2009). However satisfying a diverse set of employees is often a Herculean task for most of the software companies across the globe. High attrition can be symptomatic of inefficient management policies; as attrition does reflect the hiring policies, retention strategies, training and development initiatives, work culture and many other factors of an organization. Over and above these, there are various factors influencing attrition and often these factors are not equally significant for employees with different levels of experience. Taking the view that antecedent of attrition varies with varying levels of experience; this study has been conducted to understand the perspective of these techies for voluntarily leaving their job.

Review of Related Literature

The astronomical growth rate in the industry is an important reason responsible for rising attrition rates among the knowledge workers who are not loyal to the company but to their value system (Sadri et al., 2006). Because of high attrition rate, Indian software industry is not able to progress beyond providing low-end software coding, development and maintenance services (Arora et al., 2001). This is a tenacious concern for most of the organizations (Joseph et al., 2007) as the exodus of desirable employees is generally considered detrimental to the growth of an organization; both in terms of replacement costs and work disruption (Hallman, 1997). There also exist negative relationship between employee attrition rate and sales especially in service industries and there can be a cycle of failure of services due to the connection between high attrition and the quality of services being offered and thus replacing exiting employees is costly as well as destructive to the service delivery (Noe, Hollenbeck et al. …