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A STUDY OF INCREASING EMPLOYEE ATTRITION

RATE OF AXIS BANK: JHALAWAR (RAJASTHAN)

REGION

Gauri Dwivedi

Department of Business Administration, Kota University, Kota, Rajasthan, (India)

ABSTRACT

In the present scenario, increasing attrition rate of employees is the major issue in Private Sector Banks. The

cost incurred in Training and Development of employees lead to the additional financial burden of the bank.

The need of the hour is to reduce the burden by decreasing exodus rate of employees. The problem is especially

observed at middle and lower level management. This paper emphasizes the root cause problems of employees

in AXIS Bank of Jhalawar, Rajasthan. It will focus on the solutions along with the remedial measures which will

be beneficial to Academicians, Banking personnel and Researchers to explore their vision in this aspect. The

possible outcome of present study can be implanted in various Attrition Reduction Programme of Banks. The

benefits of this research will be multi dimensional focusing on Banks and employees benefits on the Pro-Rata

basis. Sustainable strategies should be evolved to lower the Attrition Rate by adopting various Pro-Employee

policies.

Keywords: Private Banks, Attrition rate, AXIS Bank, Jhalawar

I. INTRODUCTION

As per the 2015, May edition of PTI, Banks are likely to witness an increase of upto 50 percent in attrition this

year compared to last year as new players entering the sector would prefer seasoned industry professionals to

grow their operations. GlobalHunt Managing Director Sunil Goel said “Large Pool of Jobs is expected to be

created wherein the maximum number of the jobs will include the bottom of the pyramid, but yes existing

banking and financial professional will get recruited by the new players so the attrition will get recruited by the

new players so the attrition will get added another 15-20 percent for current companies”. Human resource is

considered to be the center of all development processes of economy. But today’s competitive business scenario

is deteriorating social conditions of human resources, hence causing employee attrition. According to Branham

(2005) in his study “The 7 hidden reasons for employees leaving organizations” are lack of recognition,

unfulfilling jobs, limited career advancement, poor management practices, untrustworthy leadership, and

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dysfunctional work cultures. The job or workplace was not as expected, the mismatch between job and person,

too little coaching and feed-back, too little growth and advancement, Feeling devaluated and unrecognized,

Stress from overwork and work-life and Loss of trust and confidence in senior. The “seeds” or initial causes of

attrition, arising out of the frustration related to budget cutting, hiring freezes, layoffs, and lack of development

funds and opportunities , are more likely to be sown at such times (Sharmistha,2010). Employees always assess

the management values, work culture, work practices and credibility of the organization.

After independence, year 1991 was marked as the significant year for the Indian Banking sector. In year 1969

after nationalization of 14 major banks a great reform arise in banking sector in India. Followed by

Liberalization, Globalization and other international events lead banking sector in India to reform and adjust to

attain competitive edge in multinationals environment. In order to cope with the changing trend as well to

provide effective and efficient service to the customer implementation of advance technology has changed the

face of banking. Installation of ATM machine, e-Banking, computer implementation and lot many inputs have

changed the work patterns of the bank employees. Directly or indirectly these reforms in policy and technology

in banking sector has deteriorated the social, economic and psychological sphere of the bank employees in

India.

In the recent decades the Indian Industry has changed its outlook. The employment scene has changed its

appearance. The factors like skill sets, job satisfaction drive the employment and not the money. The employer

hence faces the heat of continuous employee turnover. Continuous efforts are made by organizations to control

the employee turnover rate as it directly affects the performance of the organization as many key people leave

the organizations for various reasons at crucial points. This turnover is normally known as attrition.

II. CONCEPT OF ATTRITION

Working environment is the most important cause of attrition. Today’s Gen Next employees expect a

professional approach and an international style working environment. They expect a friendly and learning

environment. Employees look for freedom, good treatment from the superiors, good encouragement, friendly

approach from one and all, and good motivation. The employees often switch jobs if there is too much pressure

on performance or any work related pressure. It is quite common that employees are moved from one process to

another. They take time to get adjusted with the new processes while few employees find it difficult to adjust

and consequently leave. Monotony sets in very quickly and this is one of the main reasons for attrition. Job

hopping is very common among youngsters who look at jobs as being temporary. Another commonly looked

option is to move to such other process where there is little or no pressure of sales and meeting service level

agreements (SLA). The employees move out if there are strained relations with the superiors or with the

subordinates or any slightest, discontent.

III. DEFINITION OF ATTRITION

Attrition is the rate of shrinkage in size or a gradual, natural reduction in membership or personnel as through

retirement, resignation or death.

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IV. NEED FOR THE STUDY

Attrition effect on Public as well as Private banks , but the effect of increasing attrition rate is faced mostly by

Private Sector Banks instead of Public Sector Banks. The lowest rate of attrition is in PNB and the highest by

the ICICI Bank followed by AXIS bank as we can see in the Graph1.1The attrition rate of employees working

in Private Sector Banks are more in the recent time due to increased workload with moderate package of

financial benefits. Moreover working timings in the shift basis and non-conduciveness environment forced the

employees to search better companies. Thus the need for an authentic basis of design suitable for employee

attrition is identified as researchable area and the same has been foundation for the study. The Focus the study

will be on Axis bank’s HR policies and strategies in terms of Employee Attrition.

V. OBJECTIVE OF THE STUDY

People are considered to be the most important assets of the organisation. Therefore the employees are

encouraged for the organisation to retain for the maximum time period.

To understand the concept of attrition, reasons, needs , objectives, importance and impact on employees and

organisations in competitive situation etc.

To understand the practices followed and find out problems faced by the AXIS bank due to attrition.

To suggest ways and means to check attrition rate in Bank.

To find out the Strategy followed by bank to overcome the challenges of Attrition.

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VI. COMPANY PROFILE

Axis Bank, established in 1993, was the first of the new private banks to have begun operations in 1994 after

the Government of India allowed new private banks to be established. The Bank was promoted jointly by the

Administrator of the specified undertaking of the Unit Trust of India (UTI-I), Life Insurance Corporation of

India (LIC) and General Insurance Corporation of India (GIC) and other four Public Sector insurance

companies, i.e., National Insurance Company Ltd., The New India Assurance Company Ltd., The Oriental

Insurance Company Ltd. and United India Insurance Company Limited.

Initially, the bank was incorporated with a capital of Rs. 115 crore, with UTI contributing Rs. 100 crore, LIC

contributing Rs. 7.5 crore, and GIC and its four subsidiaries contributing Rs. 1.5 crore each. The Bank's Registered

Office is at Ahmedabad; and its Central Office is located at Mumbai. The bank has a very wide network of more than

1620 branches as on 31st March, 2012 and with a workforce of 31738 employees. The bank has been operating with

one of the largest ATM networks in the country of 6270 ATMs (as on 31st March, 2011) for providing 24 hours a day

banking convenience to its customers. The Bank has strengths in both retail and corporate banking and is committed

to adopting the best industry practices internationally in order to achieve excellence. Axis Bank entered a deal in

November 2010 to buy the investment banking and equities units of Enam Securities for $456 million. Axis

Securities, the equities arm of Axis Bank, will merge with the investment banking business of Enam Securities. As

per the deal, Enam Securities was to demerge its investment banking, institutional equities, retail equities and

distribution of financial products, and non-banking finance businesses and merge them with Axis Securities.

VII. OVERVIEW OF EMPLOYEE ATTRITION ON AXIS BANK

Table (a) highlights the data showing the importance of human factor in the AXIS Bank. Various indicators

showing the growth of the bank relating to its human resources have been depicted in terms of branch network,

staff strength, business, cost per employee over the period of study.

Source: Data compiled from Annual Publications of IBA, Bombay; Performance Highlights of Public Sector

Banks and Performance Highlights of Private Sector Banks, 2002-03 to 2011-12. And rest from the weblink.

The number of employees, though, fell in 2014-15, despite the bank increasing the number of branches from

2,402 to 2,589. By March 2015, the headcount dropped to 42,230. In the last financial year, the management

had said the drop in manpower was due to the fact that more and more transactions were happening on the

digital medium, reducing the number of employees needed at branches. Management believes despite the shift

to the digital medium, advancement of the physical footprint was still required. According to management

“While we keep on talking about the digital footprint, the physical footprint will have to increase a lot.”

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Table (a) Indicators Showing Growth of AXIS Bank from 2002-03 to 2014-15

Year Staff Strength Cost Per Employee Number Of Branches

(Number)

2002-03 2,338 0.13 140

2003-04 3,447 0.12 182

2004-05 4,761 0.12 247

2005-06 6,553 0.12 355

2006-07 9,980 0.12 508

2007-08 14,739 0.14 654

2008-09 20,624 0.13 838

2009-10 21,640 0.17 1038

2010-11 26,435 0.18 1393

2011-12 31,738 0.18 1620

2012-13 29,240 0.18 2010

2013-14 42,420 0.19 2402

2014-15 42,230 0.19 2589

VIII. IMPACT OF ATTRITION ON AXIS BANK, JHALAWAR

The current Staff intake of Axis bank in Jhalawar Region is 17, which has been decreased over the years. As

shown in Table (b).

Table (b) Showing the individual Staff Strength of 2016-17, (January)

Branch Name Staff Strength

Jhalawar 12

Peepaliya 5

The Attrition has is increasing year by year as shown in Table (c). With reference to these figures, certain

questions have been asked from the working employees to find out the reasons behind this increasing rate

attrition among employees.

Table (c) Data showing Impact of Attrition

Year Staff Strength

2013-14 20

2014-15 19

2015-16 17

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IX. OBJECTIVES OF THE STUDY

People are considered to be the most important assets of the organisation. Therefore the employees are

encouraged for the organisation to retain for the maximum time period.

1. To understand the concept of attrition, reasons, needs, objectives, importance and impact on employees and

organisation.

2. To understand the practices followed and find out the problems faced by AXIS bank due to attrition.

3. To suggest ways to decrease attrition rate in Bank.

4. To complete the requirement of research study.

5. To depict the strategies followed by AXIS bank to overcome Attrition problem.

X. RESEARCH METHODOLOGY

This research will be descriptive because the data has been classified as per various factor of study.

Sources of Study: For study purpose both Primary and Secondary data will be used. For study purpose the data

used are as under:

A. Primary Data : Primary Data is that which collected fresh and for the first time. It is also known as basic

data or original data. For this study Questionnaire has been prepared and employees of the bank have been

asked to fill the job.

B. Secondary Data: Secondary data means the data that is already available in various reports, diaries,

letters, books etc. Secondary data is that data which has been used previously for any research and now is used

second time. In short, the data presented in research reports when used again for further research is called

secondary data.

International Journals

National Journals

IBA Reports

Instruments for Data Collection: Questionnaire

Sampling: For the purpose the Questionnaire will include employees of the Bank.

Sample Size: The sample size is 17.

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XI. DATA ANALYSIS AND INTERPRETATION

Interpretation: The employees of the Bank are majorly lies in the Age group between 25 years to 34.The

number of employees after the Age 54 is Zero in Jhalawar Region. Clearly seen the employees after certain age

group leave the organisation voluntary or involuntary. So the bank needs to look for Attrition problem.

Interpretation: The Employees/ Respondents majorly work in Operations and Sales Department.

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Interpretation: The length of the service of employees majorly is between 2 to 3 years. Only 11% employees

work more than 5 years.

Interpretation: According to employees the main HRM challenges are Performance Management with

Employee Attrition. 22% employees believes the Bank fail to provide an environment where the employee can

stay for a long tim

Data Interpretation: Large number of employees belief that Employee Attrition is recognized HR challenge as

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after 5 years only 11% employee stay in the Bank to work.

Interpretations:

When I tried to find out the reasons behind the problem, Employees stated many reasons behind Attrition

Problem. The important among them are

1. Employee’s Expectations from Job: Employee expectations include the timely and accurate payment of

wages, adequate training, safe working conditions, full explanation of all Bank policies, especially of

employee’s job responsibilities, and fair and constructive feedback from supervisor. If any of these

expectations are not being met, the employee morale got down. And moreover most of these employee

expectations are not only reasonable, but also are required by law.

2. Lack of Career Growth: Employees think there career path is not very much rewarding.

3. Absence of Conducive Work place Environment: Employees feel Bank don’t provide a work environment

that encourages employee engagement.

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Interpretation: More than 80% employees are willing to leave the organisation after 5 years as we have

discussed this before. This is the reason why the length of the Work Tenure of many employees is limited to 2

to 5 years in this Bank.

Interpretation: Junior Level employees are more prone to Attrition in bank. As his Needs are not covered up by

the Management of the Organisation.

Interpretation: Notice Period is the time period has to be given to an employee by his employer before his

employment ends. It also refers to the period between resignation date and last working day in the company

when an employee resigns. Bank made it mandatory for the employees to serve a Notice Period so that the Bank

can look out for other options

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Interpretation: The Notice Period duration time in Bank is more than 60 Days. The Management got ample time

to train substitute and employee has sufficient time to submit the pending work on time.

Interpretation: The main influencer for the employee is money. Approximately 53% of employees believe that

the basic needs are fulfilled on Monetary Basis.

Interpretation: Exit interviews are conducted when employees leave the bank to know the reasons why they

are leaving the organisations and what changes are needed to be done in the current scenario to change the

situation.

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Interpretation: Because of Attrition, the Bank/Organisation faces many problems. The Cost of hiring and

training the incumbent increases and the cost which have been occurred while training the employee who left

the organisation goes in vein. The Customers tend to deprive away from the Bank/Organisation as the Customer

Relationship plays a major role in the mind-set of the user.

Interpretation: This is the Positive aspect that the bank is countering the Attrition Problem and trying to resolve

it by working on building HRM Strategies.

Interpretation: The Management provide Promotion or Title Announcement to the employee who willing to

leave the organisation to make them stay.

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Interpretation: More than 53% employees don’t have any awareness about career advancement scheme. Bank

need to spread awareness about its Career Advancement Schemes, so that the employees feel motivated and

willing to work more enthusiastically.

Interpretation: 65% employees believe the wages or salary provided by the Bank is Competitive with other

banks that are they are satisfied with the pay structure. But 23% employees are not happy with the pay structure

and 12% employees don’t have any knowledge about how competent their Salary is.

XII. FINDINGS

1. If we see the attrition rate for AXIS Bank year by year its increasing because of many reasons and many

organisations are providing different types of working facilities which creates a keen competition in the

market.

2. Bank has adopted Creative HRM Strategy to counter Attrition.

Strategy adopted by Axis Bank: According to Axis Bank Officials “There is a huge vacant space that needs to

be filled up. We will be offering more branches next year. We’re also having a different approach to delivering

to our customers. So some of our formats, like Burgundy (a service especially for high net worth individuals)

will expand,” he added. Apart from this, employees will be added in the digital and analytical teams as well. In

the coming year, the lender will also be focusing on hiring more from the semi-urban space. As a result,

graduate students would be in focus.

3. Most of the respondents were not fully aware of the company’s terms and conditions since joining the

organisation.

4. The problem is mostly found in Junior Level Management. The main focus of the Bank should be on the

issues of junior Level Management.

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XIII. SUGGESTIONS

1. Bank should follow rigorous HR practices to give job security and welfare assure to the employees.

2. Bank must have transference in their system to motivate the employees. 3.

3. It is found from the research that more than half of the employees with unambitious go for attrition.

Therefore the interpersonal relationship between top level executives and middle/Junior level managers

would delete un-enthusiasm prevailing the employees.

4. It is found from the analysis that attractive remuneration and packages are the main factors influencing

attrition. Therefore the remuneration proportionate to the work responsibility must be periodically

determined by the Top executives.

XIV. ACKNOWLEDGEMENT

I express my Gratitude and sincere Thanks to the authorities of Kota University, for having permitted me to carry out

Research Work along with my Supervisor

Dr. R.A.Gupta. I am extremely indebted to the employees of AXIS Bank, Jhalawar for giving much needed

time to fill the Questionnaire and sharing their views on my Research Topic.

XV. BIBLIOGRAPHY

Journal Papers

Branham, L. (2005), “The 7 hidden reasons employees leave Organisation” – How to Recognize the Subtle

signs and act before it’s too late, Sarnac Lake, NY,USA: AMACOM

C.Gelani (2015), Comprehensive Study Of Attrition Strategy Of HDFC BANK in Ahmadabad Region;

RHIMRJ

Imtiaz, S and Ahmad, S (2010), Impact Of Stress On Employee Productivity, Performance and Turnover;

An important Managerial Issue.

Theses

Thirulologasundaram V. Ponnusamy, Attrition Management and Strategies ( LAMBERT Academic

Publishing, 2015)

Webliography

www.growthsourceinc.com/Articles/ChallengeofRetainingTopTalent.pdf

http://www.iba.org.in/

En.wikipedia.org/wiki/Turnover_(employment)

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http://www.business-standard.com/article/finance/axis-bank-plans-to-increase-headcount-by-10-in- fy17-

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http://www.thehindubusinessline.com/money-and-banking/with-new-players-in-fray-private-banks- face-

talent-poaching-threat/article7659983.ece