When we regret something, the first question that pops up in our mind is – what went wrong? The Regretted Attrition metrics are exactly about that. Let’s look at attrition in HR, more specifically ‘regretted attrition’ in HR from a layman’s perspective. For them, it refers to the people that the company regrets losing to some other company. But, in actuality, it includes only those employees who have not been asked to leave and weren’t poor performers. If we slice and dice the attrition meaning in monetary way, a company is said to be experiencing regretted attrition when the cost of replacement for the talent is greater than the leaving employee’s retention.
They are used to analyse what went wrong i.e. see the most frequent factors contributing to losing critical talent. However, employers get uneasy when asked to admit that things didn’t go right because either they calculate it wrongly or they have not started considering it yet. Wondering why we are stressing on this HR analytics parameter this much?
To help you understand, all about attrition in HR, in this blog we cover-
- Attrition Meaning
- Regretted Attrition Importance
- Attrition Calculation
- Can regretted attrition be healthy too?
- What you should and should not do?
What is Regretted Attrition Rate?
Put simply, a regretted attrition refers to the employees that the organization truly regrets upon losing.
Actually, it refers to the voluntary attrition in HR by highly talented and key contributors impacting the business of the company. This excludes the employees who are asked to leave the organization due to poor performance, or some other reason.
Why is Regretted Attrition important?
Companies are following a trend where they summarise the regret attrition of the entire company altogether, which is not a good idea. It will not benefit anyone, as it will not have any micro-level details. Instead, there should be a detailed study to see how this attrition is affecting the company.
It is very important that the organization keeps a track of losing the valuable resources or high potential employees. Quite often the senior management senses when a key employee is about to quit the organization. But fails to do anything to retain that employee.
Who wants to lose the best resources of their company? No employer or HR. By calculating this metric you get a better insight as to what is making them all switch to another organisation, thereby enabling you to be in a better position to retain them.
How to calculate regretted attrition rate?
For attrition calculation, put the relevant figures in the formula mentioned below-
Attrition Rate = Number of Attritions/Average Number of Employees *100.
Is there a specific number that the regretted attrition rate should not exceed?
Ideally, if the rate is 15% or more, it should be considered as alarming enough by the organisation
Can Regretted Attrition be healthy too?
Yes, to a certain extent, attrition can be good for the business. The team continues to funnel at higher job levels and without regretted attrition, you will not have enough space to promote everyone. Keeping them in the same position would also only elevate your manpower costs. There is always the option to hire fresh talent for entry level positions and lower/ manage your costs.
What you should and should not do?
It is pivotal to handle the key resources and classify them as ‘Regret Attrition’ at the time of exit. Let us see how.
Always try to make Regretted exits a part of analytics dashboard.
There should be a tab in your HR software where managers are able to mark ‘really regretted’ for the employees for whom they actually felt it. There should be an option for them to provide a remark of why they have been marked as “really regretted”.
Do not judge the reasons. Just note them for future purpose.
When you have got a good sum of ‘really regretted’ exits (try to come up with some number that you will consider), explore the reasons, and then generate a list containing top reasons classified as ‘really regretted’.
Once this exercise is done thoroughly, you will get a list containing major reasons. This list will help managers to select any one of the reasons in the future.
This exercise will help you in the long run. After sometime, you will have a tangible list of the ‘really regretted’ reasons. The list will help you in getting data-points where you need to take actions.
Isn’t it such an easy yet so impactful technique? In the longer run, this will help you design some employee retention techniques that will actually work. Go on, spot the unwanted employee turnover. Calculate the rate, work on making the strategies and save that important resource if not till the last, then at least for the longest.