A

Project Report
On
EMPLOYEE RETENTION POLICIES AND
STRATEGIES IN I.T. SECTOR

Submitted in Partial Fulfillment for the Degree of

Bachelor of Business Administration

S.S. JAIN SUBODH P.G. (AUTONOMOUS) COLLEGE, JAIPUR

(2017-18)

SUBMITTED BY SUBMITTED TO
DEEP PATEL Dr. GAURI DHINGRA
B.B.A. IV Sem. ASSISTANT PROFESSOR
 CERTIFICATE

This is to certify that the Project Report entitled “EMPLOYEE

RETENTION POLICIES AND STRATGIES IN I.T. SECTOR” is a
record of project work done independently by [Link] PATELunder my
guidance and supervision and that it has not previously formed the basis for
the award of any degree, fellowship or associate ship.

Dr. GAURI DHINGRA

ASSISTANT PROFESSOR

S.S. Jain Subodh P.G. (Autonomous) College

Jaipur

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 DECLARATION

I, DEEP PATEL student of BBA Sem IV hereby declare that the project work
presented in this report is my own work and has been carried out under the
supervision of Dr. GAURI DHINGRAof S.S Jain Subodh P.G.
(Autonomous) College.

This work has not been previously submitted to any other university for any
examination.

DEEP PATEL

S.S. Jain Subodh P.G. (Autonomous) College

Jaipur

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 ACKNOWLEDGEMENT

It is not often in life that you get a chance of appreciating and expressing your
feelings in black and white to thank the people who have been a crucial part of
your successes, your accomplishments, and your being what you are today. I
take this opportunity to first of all thank the Faculty at S.S. Jain Subodh P.G.
(Autonomous) College, especially Dr. [Link], Principal, and Dr. Rita
Jain, Head, Department of BBA for inculcating and instilling me the
knowledge, learning, will-power, values and the competitiveness and
professionalism required by me as a management student.

I would like to give special thanks to Dr. GAURI DHINGRAor educating me

silver lining in every dark cloud. Her enduring efforts, guidance, patience and
enthusiasm have given a sense of direction and purposefulness to this project
and ultimately made it a success.

I express my sincere and heartiest thanks to everyone who has contributed

towards the successful completion of the Project.

Last but not the least; I would like to thank my family: my parents for
supporting me spiritually throughout my life.

The errors and inconsistencies remain my own.

DEEP PATEL

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CHAPTER: 1

EMPLOYEE
RETENTION

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1. INTRODUCTION

The fast developing knowledgeeconomy coupled with the information

technology during the last two decades has totally changed the complexion of our
business and employment relation . The globalized economy and the labour market
have further added new dimension to this phenomenon. India has taken advantage of
this growing trend entering the IT sector of the economy and industry . Though the
Indian is fast responding and taking the challenge head on and competing effectively
in the new IT dominated global market the industrialist-employer in the IT industry
are facing another challenge, namely, finding suitable people to recruit to the jobs
being generated by them. When and where they are able to find people who can meet
their expectations, they are facing the new challenge that this is coming their way in
the form of retaining the people working with them. In fact, recruitment and retention
are two sides of the same coin. Economically and financially employee retention, of
late has acquired greater significance. It is much more costly and time consuming to
find the right replacements.
Resultantly the employee retention has turned out to be a critical challenge to the
employers. They have become very sensitive to the problem of employee retention.
Researchers also are seized of the situation and getting involved in this challenge.
Studies by researchers in the US have enabled the employers to benefit in managing
the attrition and retention. Both the industries and researchers are greatly concerned
with designing and developing different strategies for effectively retaining the people
already in employment. Roger E. Herman and Gregory P Smith have written at length
on the Employee Retention Strategies during the last two decades and theindustrial
organizations that have followed them had immensely benefitted. It must however be
admitted that the employers who have gained knowledge of those employee retention
strategies have been putting them into practice in Indian organizations as well – old
and new, traditional manufacturing and modern knowledge based information
technology industries. But research on the Employee Retention Strategies in practice
in Indian industries and perceptions of their managers and employees toward the
employee retention strategies in practice are not attempted and reported.
The increasing rate of employee attrition and the problems the employers and the HR
managers face in retaining ‘good’ and ‘performing’ employees in the absence of a set
of employee retention strategies are simply compounding. There may be some
managers who may be writing on employee retention strategies regularly in
newspaper columns drawing from their knowledge and experience. But there is a
recognized absence of empirical researcher on the subject. With a view to bridge this
gap in verified knowledge on employee retention strategies in Indian industries this
study was [Link] this the IT industry in Bengaluru was selected, considering
its fast growth and urgency of the problem of employee retention. The purpose of this
research study, in other words, is to bring out a fresh and indigenous knowledge on
Employee Retention Strategies in practice in the sunrise industry of Information
Technology industry in Bengaluru.

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1.1 LITERATURE REVIEW

Work-life balance is increasingly important for engagement and affects

retention. Hyman et al., (2003) in their empirical research in the UK found that
interventions of work demands into the personal life (e.g. working during the
weekend) resulted into heightened stress and emotional exhaustion among the
employees. In a study conducted by the Australian Telework Advisory Committee
(2006) it was found that 70% of businesses that incorporated telework options
reported a number of positive benefits, such as increased business productivity and
reduced costs, improved employee flexibility and work life balance, and increased
workforce participation.
According to Miller, Erickson & Yust (2001) employees get benefited by work
environment that provide a sense of belonging. Wells & Thelen (2002) have stated in
their study that organizations which have generous human resource policies, have a
very good chance to satisfy and retain employees by providing them an appropriate
level of privacy and sound control on work environment which enhances the
motivation levels to commit with the organization for the long term. Ramlall (2003)
stressed the need for recognizing the individual needs of an employee in an
organization as it will encourage commitment and provide a suitable work
environment.
Messmer (2000) found that one of the important factors in employee retention is
an investment in employee training and career development. The Organization is
always invested in the form of training and development of those workers from whom
they expect to return and give output on its investment. Tomlinson (2002) forwarded
the view that organizations can keep the leading edge in this competitive world by
having their employees well trained in the latest technologies. Garg & Rastogi (2006),
explained that in today’s competitive environment feedback is very essential for
organizations from employees and the more knowledge the employee learn, the more
he or she will perform and meet the global challenges of the market place. Handy
(2008) has mentioned that proper innovation, and assimilation of new knowledge is
essential for survival in any work environment. This knowledge is the most expensive
asset of any firm. Leadership and Employee Retention. Eisenberger and associates
(1990), suggested that employee’s perception regarding an organization is strongly
influenced by their relationship with the supervisor. McNeese-Smith (1995),
mentioned in his study on Leadership behavior of hospital directors found that there is
significantly positive relation between productivity, worker satisfaction and
organizational commitment of staff. Brunetto and Farr-Wharton (2002) were of the
view that supervision of the immediate manager increases the level of job satisfaction
in the public sector employees. Chung-Hsiung Fang, Sue-Ting Chang, Guan-Li Chen
(2009) has found that leadership style can affect organizational commitment and work
satisfaction positively and work satisfaction can affect organizational commitment
and work performance positively.

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1.2 Objectives of the Study

 To analyze the supportive relationship between employees and management.

 To examine the level of motivation in the organization.
 To determine the stress level of employees in the organization.
 To understand the various factors influencing the employee for retaining them.
 To suggest and recommend some measures to improve employee retention
strategies.

1.3 DEFINATION
Employee retention refers to the ability of an organization to retain its
employees. Employee retention can be represented by a simple statistic (for
example, a retention rate of 80% usually indicates that an organization kept
80% of its employees in a given period). However, many consider employee
retention as relating to the effort by which employer attempt to retain
employees in their workforce. In these sense, retention becomes the strategies
rather than the outcome.

1.4 IMPORTANCE
 Costs of hiring (posting a job and conducting interviews)
 Costs of onboarding (time spent by manager training)
 Learning curve (a new employee will take months before they
are as good as the old employee)
 Emotional costs (lower productivity from rest of the team)

It is also important for manager to understand that employees are what is

known as an “appreciating assets”, meaning that they appreciate in value over
time. The longer someone stays at company, the more productive and valuable
they are.

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