Retention, especially of an organization’s high performing employees, continues to be a challenge in India. To this end a recent survey on human capital effectiveness by PwC Saratoga India brings forth the point that Indian organizations trail behind their global counterparts when it comes to retaining talent. It has assumed greater significance since companies are betting on their best people to keep bottom-lines healthy in a flagging global economy.
With 35 percent of its workforce having tenures of less than two years, Indian organizations lag behind their APAC and Western counterparts in retaining their people. The numbers for APAC and Western region stand at 30 percent and 15 percent respectively. The survey which covered 58 Indian firms across sectors found that banking and ITeS companies witnessed the highest voluntary employee turnover with the employee resignation rate in banks being 2.9 times more than that for engineering and manufacturing organizations.
Talent constraints are imposing tangible costs on companies. A look at the impact of talent constraints in India suggests that businesses have lost out in terms of cancelling or delaying key strategic initiatives. According to the 15th PwC Annual Global CEO Survey; 41 percent of CEOs in India had to either cancel or delay a key strategic initiative and 39 percent of CEOs stated that their talent related expenses rose more than expected.