The reduction in staff and employees
in a company through normal means,
such as retirement, resignation or
This is considered natural in any
business and industry.
Attrition is also called Total Turnover or
Why worry about Attrition?
A high rate of attrition or manpower
turnover in an organization leads to
increased recruitment, hiring and
Not only is it costly but qualified and
competent replacements are hard to
Types of Attrition
Positive Attrition - Where the company
inherits new talent when an employee gets
promoted or when the company dismisses an
employee due to underperformance.
Negative Attrition – When a productive
employee resigns causing a loss of talent and
skills within the company.
Employer Vs. Employee
Usually due to:
- Violation of company
policy by the employee
- Necessary staff
- Change of management
Usually due to:
- Better offer at a different
- Change of career plans
- Disputes within the
- Personal or Family
Attrition is inevitable and
usually highest during the 1st
quarter of the year
Lack of Appreciation and Motivation
Change of location and
To pursue further study
Specific Causes for Attrition
Use of referral schemes
1/10 is made a
1/100 is made a
Change of place
Salary & benefits
High Stress Levels
Nature of the job
Effects of Attrition
– employees serving their
notice of resignation will no
longer work as hard as
they did before.
Loss of Knowledge and
Experience – the
employee takes this with
him or her when leaving.
Loss of current clients and
business associated with
the departing employee.
Negative emotional impact
of other team members.
Effects of Attrition
Excessive burden of
workload to those left
Loss of revenue and
increased cost to
company in hiring and
training new staff
Believe it or not, 30%
attrition per month is an
accepted as a norm in
most BPO companies.
Generally, it is more cost
effective to retain
employees than to hire
Unfair Compensation and Benefits
Inability to cope with the demands of
Job becomes boring, routine
and monotonous lacking
Lack of career growth opportunities
Bad Leadership and Incompetent
Issues with Peers and in the Office
Appreciation and Motivation
Change of Career Plans*
Change of location and
To pursue further study*
Motivation is the result of processes, internal or external to the
individual, that arouse enthusiasm & persistence to pursue
a certain course of action
It represents an unsatisfied need which creates a state of
tension, causing the individual to make a goal oriented pattern
towards restoring a state of equilibrium by satisfying the need.
Satisfier – what is need for workers to be satisfied with the job
but will not motivate them to stay.
Motivator – something that gives someone a reason for doing
something and encouraging conditions of being eager to act
NATURE OF MOTIVATION
It refers to the set of forces that cause people to behave in
It is the inner feeling which energizes a person to work
The emotions or desires of a person prompt him for doing
a particular work
Importance of Motivation
Low employee turnover
Better industrial relations
Acceptability to change
Better quality orientation
Maslow’s Hierarchy of Needs
Physiological Motivation: Provide ample breaks for
lunch , pay salaries that allow workers to buy life's
Safety Needs: Provide a working environment which is
safe, relative job security, and freedom from threats.
Social Needs: Generate a feeling of acceptance,
belonging by reinforcing team dynamics.
Esteem Motivators: Recognize achievements, assign
important projects, and provide status to make employees
feel valued and appreciated.
Self-Actualization: Offer challenging and meaningful
work assignments which enable innovation, creativity, and
progress according to long-term goals.
Limitations and Criticism
Maslow’s hierarchy makes sense but little evidence
supports its strict hierarchy. Research has challenged the
order imposed by Maslow’s pyramid. As an example, in
some cultures, social needs are regarded higher than any
Little evidence suggests that people satisfy exclusively
one motivating need at a time.
HERZBERG 2 FACTOR
Herzberg conducted a motivational study on 200
accountants and engineers
There are certain factors that tend to be consistently
related to job satisfaction (Motivational factor) & on the
other hand there are certain factors which are consistently
related to job dissatisfaction (Hygiene factor).
They do not motivate people much.
If these factors are present they
don’t motivate but if absent leads to
There are 10 maintenance and
Company policy or administration
Interpersonal relationship with
Interpersonal relationship with peers
These factors have a positive effect on job
satisfaction and often results in increase in
They enhances morale, satisfaction,
efficiency and productivity.
If these factors are present they motivate,
if absent does not lead to dissatisfaction.
There are 6 factors:
He developed 2 theories : Theory X & Y
Theory X workers could be described as:
- Individuals who dislike work and avoid it.
- Individuals who lack ambition, dislike responsibility
- Individual who just desire security
Theory Y could be described as:
- Consider effort at work as just like rest or play
- They don’t dislike work.
- Individuals who seek responsibility
“Masunurin at Magalang”
Filipino workers are
generally obedient and
are bred to recognize
authority and seniority.
Filipinos are respectful,
This makes them
Filipinos are social
beings that have the
need to identify with a
They are good team
players and exhibit
themselves in mutual
cooperation, which is
best pictured through
Filipinos are hard
workers with great
They will work overtime
if the job requires it
without any complaint
Filipinos are resilient to
adversity and can
endure much more than
other people can.
Filipinos are world
renowned for Ingenuity.
They always find the
best and most effective
way to complete tasks.
However, this is a “Gray
Area” trait which can
also prove to be
“Kulang sa Disiplina”
Filipino workers lack
discipline and many
have no regard for rules.
This leads to
carelessness and often
puts workers in conflict
with their companies.
Filipino workers are highly emotional and tend to take
things too personally.
They are unable to separate work from their personal
It is difficult to give them feedback and constructive
They may hold grudges against bosses, peers and their
company. (Sama ng Loob)
Filipinos, in general,
have a great tendency to
gossip at the expense of
Such gossip is often due
to “envy” or “dislike” for
a particular co-employee
and is damaging overall
for company production
“Utang na Loob”
Filipinos are naturally
indebted to people that
help them and that is
generally a good trait.
However, in industry
indebtedness may lead
to unscrupulous acts
which go against
company ethics or
Leads to Nepotism and
Filipino workers have a
tendency to be well
motivated at first then
fall into procrastination
and other bad habits.
They tend to give too
much at first and are
easily burnt out later.
Filipino workers tend to
neglect quality in favor of
quantity and speed as well
as ease of work.
There is high tolerance for
inefficiency, poor service
and even violations of
one’s basic rights
Disregard for quality
standards and little pride in
work done in favor of
Although Filipino workers may work well in teams, they have a tendency to be
selfish and self-centered. Personal interests over everyone else's.
They will have little or no reservation to save themselves at the expense of others.
Filipinos have a selfish, self-serving attitude that generates a feeling of envy and
competitiveness toward others, particularly one’s peers who seem to have gained
some status or prestige. (Talangka Mentality)
They may also forget loyalty if it is in their best interest to do so. (Makapili
would like to put off
doing things until it is too
A generally severe form
of procrastination that is
productivity in most
sometimes expect too
much, too soon.
They are impatient and
unwilling to wait for the
right time for bonuses
Gratification first before
“Sip sipan at Palakasan”
Related to “Palakasan
system” where Filipino
workers would go out of
their way to win the
favor of their manager.
This favor is perceived
as an advantage in
getting more benefits,
promotions or lessened
Many Filipino managers
have a paternalistic
approach to leadership.
They tend to become
too affected and
involved even with their
and family problems.
Most Filipino managers and employers are authoritative in nature
and demand utmost respect.
They expect to be respected for the position they hold. (Title-
Generally arrogant and unwilling to heed to advice or reason.
Seniority is placed over competence and potential.
Most Filipino managers
are micromanagers who
do not trust the
competence and skills of
the people they lead.
“Tutok na tutok” shows
the lack of trust that
many employers have in
Lack of Accountability
Many Filipino managers
have the tendency to
pass on blame to his
workers for all failures.
They will readily
sacrifice workers in
order to save
themselves from any
retribution for failures.
Many managers tend to
favor some employees
in favor of others.
Some have trouble
their social relationships
with their employees.
Some Filipino managers
tend to take employee
misgivings too seriously.
This leads to deep
dislike and disfavor for
leading to their ultimate
dismissal from the team
Many Filipino Managers
(like most workers) tend to
be passive when
confronted by Upper or Top
When they need to assert
themselves to upper
management they fail to do
Instead, they assert
themselves very strongly
on their employees when it
is uncalled for.
Many employees if discontented with their salary or the
company (or both) will generally wait until January to find
a new job.
They will pass resignation letters either within the month
of December or early January (if they ever do).
There is always an emotional component behind every
The emotional component blocks out most logic and reason
when deciding to resign.
May lead to AWOL (Absence With Out Leave)
Signs of Disengagement
Rarely do Filipino employees leave a company without showing
signs of disengagement.
Progression of Withdrawal Theory - dissatisfied individuals
enact a set of behaviors in succession to avoid their work
physical job withdraw
psychological job withdraw
Withdrawal behaviors are related to one another, and partially
caused by job dissatisfaction.
These are some signs of
Frequent tardiness or absenteeism
Diminishing productivity or quality of work
Slacking off at work and taking long breaks
Sudden changes of mood at work
Sudden disrespect for superiors and the company
Change of attitude towards teammates and co-workers
Gossiping and Rumor mongering
Little Thought of
As emotions may block out reasoning and increases
rationalization to leave, for many there is little thought
about consequences for doing so.
Some do not think about being unemployed and how
difficult it is to find another job.
Projects and clients are left hanging with little or no proper
Why do employees
make such rash and
impulsive decisions to
leave a company and
Amygdala hijack is a term
coined by Daniel Goleman
in his 1996 book Emotional
Intelligence: Why It Can
Matter More Than IQ.
Goleman uses the term to
responses from people
which are immediate and
overwhelming, and out of
measure with the actual
stimulus because it has
triggered a much more
A situation seen is sent through to the Thalamus then to
the Occipital cortex for processing.
At the same time, memories from the Hippocampus are
“matched” with the stimulus to see if it a a “Fight or Flight”
If perceived to be so, the amygdala blocks out reasoning
from the frontal lobe.
The emotional brain (amygdala) activity processes
information milliseconds earlier than the rational brain
When the amygdala perceives a threat, it can lead that
person to react irrationally and destructively.
Loss of self-control.
An amygdala hijack exhibits three signs: strong emotional
reaction, sudden onset, and post-episode realization if the
reaction was inappropriate.
Usually this realization comes too late.
“Amygdala Hijack” is an
in the emotions of
suddenly resign or go
Highly productive and
High degree of discipline
Superior attention to
quality as evident in their
Usually stays with one
company from cradle to
Japanese companies have
the lowest employee
attrition rates in the world.
(0% to 4%)
popularized by Dr.
Theory Z focused on
loyalty to the company
by providing a job for
life with a strong focus
on the well-being of the
employee, both on and
off the job.
According to Dr. Ouchi, Theory Z management tends to
High employee morale and
Characteristics of Theory
Long-term employment and job security
Implicit, informal control with explicit, formalized measures
Slow evaluation and promotion
Moderately specialized careers
Concern for a total person, including their family (Holistic
What is Employee Retention?
Employee retention is a process in
which the employees are encouraged
to remain with the organization for the
maximum period of time or until the
completion of the project.
Employee retention is beneficial for
the organization as well as the
Importance of Employee Retention.
Reduced cost of turnover
Reduced loss of company knowledge
Reduced interruption of Customer Service
Intervention as turnover leads to more turnover
Goodwill of the company
Key Areas in Employee Retention
Compensation Environment Growth
Retention Strategies used by some
IBM Business Services –
management diplomas and MBA courses
HCL Tech BPO Services –
career counseling and planning career paths
Compensation – Check current rates and see if your employees
are receiving the “Going Rate” for their position.
Incentives - Discuss Performance based incentive systems with
Create Trust – Many employees see HR as being oppressive and
“loyal dogs” of their employers. Change this image!
Periodic Follow up Interviews – Set periods where key people
are constantly evaluated for job satisfaction.
Career Planning – Ascertain employee goals and develop career
plans for them with milestones for achievement.
Awards and Recognition – Create such programs with unique
incentives to encourage both retention and peak performance.
Training – Initiate Career Skills and Leadership Development
training programs that are “tailor-fit” to the company’s needs and
Resources - Ensure that Management provides sufficient
resources for employees to do their work effectively.
Relationships – Schedule team-building activities and
encourage Management to take part.
Open Door Policy – Encourage employees to report
grievances in the office to HR. “Employee Welfare Program”
Exit Interviews – Ensure that your company has this and
record/review all reasons for employee resignation. Identify
patterns and intervene!
Human Resources plays
a very crucial role in
Employee motivation is an important factor in Employee
Satisfiers do NOT prevent attrition, motivators do!
There is a dire need for Excellent Leadership and
Competent Management in order to prevent mass
Understanding the Psychology of Filipino Managers and
Workers enables the creation of effective solutions to
Human Resources plays a crucial role in addressing the
problem of attrition.