FINAL PROJECT REPORT ON THE STUDY OF EMPLOYEE RETENTION AT (RELIANCE COMMUNICATION LTD.

CHANDIGARH) SUBMITTED TO PUNJAB TECHNICAL UNIVERSITY IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION

Submitted By: RAJWINDER KAUR ROLL NO.-90762235027 (SPECIALIZATION: - HUMAN RESOURCE) SRI SUKHAMANI INSTITUTE OF ENGG & TECHNOLOGY AFFILIATED TO PUNJAB TECHNICAL UNIVERSITY, JALANDHAR 2009-2011

DECLARATION
I, the undersigned hereby declare that the final project report submitted to my college i.e. SRI SUKHMANI INSTITUTE OF ENGG & TECH. in partial fulfilment for the Degree of Master of Business Study the Employee Retention At Reliance communication Ltd is a result of my own work under continuous guidance and kind co-operation of our college faculty member, Mr. A.K SOOD. I have not submitted this training report to any other university for the award of degree.

Rajwinder Kaur

CERTIFICATE OF GUIDE
This is to certify that the project entitled Study of the Employee Retention at Reliance Communication Ltd is submitted as a final project report of the requirement for the degree of MBA, affiliated to the Punjab Technical University, Jallandhar is a work carried out by Rajwinder Kaur, Roll. No.90762235027 under my supervision & guidance.

Project Guide (Mr. A.K SOOD)

ACKNOWLEDGEMENT

Research is an endless ocean and one requires guidance and support by several individuals in order to derive out a hand full of pearls from its depth. It is difficult to acknowledge so precious a debt as that of learning, as it is the only debt that is difficult to repay except through gratitude. I take the privilege to pay my deepest appreciation and heartiest thanks to all my teachers of SSIT, whose constant guidance is unbounded source of inspiration for us. I would like to express my sincere thanks to my Project guide Mr. A.K SOOD who provided me valuable insights on my topic and helped me to clearly chalk out my area of study.

Last but not the least; I would take the opportunity to thank my parents, friends and all those visible and invisible hands that contributed to make this project a success.

Thank you

(RAJWINDER KAUR)

TABLE OF CONTANT

CHAPTER NO.

CONTENTS

PAGE NO

1.

INTRODUTION

6 - 33 34 43 44 48 49 53 54 72 73 74 75 76

2. COMPANY PROFILE

3. REVIEW OF LITERATURE

4.

RESEAECH METHODOIOGY

5.

ANALYSIS & INTERPRETATION

6.

CONCLUTION & SUGGESTION

7.

QUESTIONNER

8.

BIBLIOGRAPHY

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INTRODUCTION

TO THE EMPLOYEE RETENTION

1.1 EMPLOYEE RETENTION

Employee turnover is one of the biggest challenges faced by most companies today. It is not only difficult for the employer to let an employee go but twice as difficult for him to train a new recruit. As per the Websters Dictionary, retention is the act of Retaining, the state of being retained, the power to retain. According to the American Management Association, the cost of replacing an employee is approximately 30% of his annual salary, which is an important issue for companies in the competitive world.

Retention - A Big Challenge

Fundamental changes are taking place in the work force and the workplace that promise to radically alter the way companies relate to their employees. Hiring and retaining good employees have become the chief concerns of nearly every company in every industry. Companies that understand what their employees want and need in the workplace and make a strategic decision to proactively fulfill those needs will become the dominant players in their

respective markets. The fierce competition for qualified workers results from a number of workplace trends, including:

A robust economy Shift in how people view their careers Changes in the unspoken "contract" between employer and employee Corporate cocooning A new generation of workers Changes in social mores Life balance

Concurrent with these trends, the emerging work force is developing very different attitudes about their role the workplace. Today's employees place a high priority on the following:

Family orientation Quality of life issues Autonomy

Smart employers make it a strategic initiative to understand what their people want and need -- then give it to them.

1.2 REASONS FOR TURNOVER:

Employees resign for many different reasons. 1)Sometimes it is the attraction of a new job or the prospect of a period outside the workforce which 'pulls' them on other occasions they are 'pushed' due to dissatisfaction in their present jobs to seek alternative employment. 2) Sometimes it is a mixture of both pull and push factors. For a fourth group reasons for leaving are entirely explained by domestic circumstances outside the control of any employer, as is the case when

someone relocates with their spouse or partner. Recent research strongly suggests that push factors are a great deal more significant in most resignations than most managers appreciate. 3) It is relatively rare for people to leave jobs in which they are happy, even when offered higher pay elsewhere. Most staff have a preference for stability. It is important to appreciate that the reasons people give for their resignations are frequently untrue or only partially true. The use of exit interviews is widespread yet they are notoriously unreliable, particularly when conducted by someone who may later be asked to write a reference for the departing employee. They are reluctant to voice criticism of their managers, colleagues or the organisation generally, preferring to give some less contentious reason for their departure. Researches highlight the importance of front line managers and how their behaviour relates directly to the levels of commitment, motivation and satisfaction reported by employees. 4) A poor relationship with a line manager can be an important reason for individuals leaving their organisation, but its significance can be masked as a result of the difficulties associated with exit interviews mentioned above.

5) A lack of training and developmental opportunities is also major reason for voluntary turnover. Broadly , these reasons can be classified into three categories based on the extent to which they can be controlled by the organization. Organizations need to devote more attention to the fully controllable factors like relationship with immediate supervisor etc., since they heavily influence the employees decisions to stay in the organization.

Non-Controllable

Less Controllable factors 8

Fully Controllable

Factors

Factors

Factors

1. Poor Health

3. More Pay to develop skills

6. More Opportunity

2. Family issues a. Need to relocate to the native place b. Need to take care of parents, pregnancy etc.

4. Better prospects for growth in ones career 5. More Security

7. Poor relationship with colleagues 8. Poor relationship with immediate Supervisor

1.3 Degree of Employee Turnover

A certain amount of employee mobility is inevitable. Illness, accidents, ageing, death and a variety of personal reasons bring about separations from job. Although some degree of mobility is both inevitable and healthy, too much of it can severely reduce productivity, demoralise incumbents and damage an organisation public image. On the other hand, too little internal mobility stultifies employee ambitions and too low a rate of external mobility results in a moribund organization. It is important employers have an understanding of their rates of labor turnover and how they effect the organization's effectiveness. Depending on the size of the business, an appreciation of the levels of turnover across occupations, locations and particular groups of employees (such as identified high performers) can help inform a comprehensive resourcing strategy. Making sure that new joiners have realistic expectations of their job and receive sufficient induction training can help minimise the number of people leaving the organisation within the first six months of employment. Tools such as confidential exit surveys and staff attitude surveys can help people managers understand why people leave the business, so that they can take action accordingly. Measurement of the costs to the employer as a result of turnover is vital in building the business case for thorough and effective recruitment and retention initiatives. These costing can be a powerful tool for winning line manager and Board-level support for people management activities in these areas.

1.4 DIFFERENT KINDS OF EMPLOYEE TURNOVER

Succession: Hiring new employees or re-hiring former employee, calling back employees after lay-off, transfers from other branches of the organsisation. Separations: Termination of employment a) VOLUNTRY QUITS: with competitors on prowl on all fronts, fat pay packets, quicker promotions better brand name of the company lead to voluntary quits. b) LAY OFF FOR LACK OF WORK: termination initiated by employer as a job is eliminated or reduction of employment due to insufficient demand. c) DISPLINARY LAY OFF: Dissatisfaction with an employees performance or conduct. d) PERMANENT/PARTIAL DISABILITY/RETIREMENT

MOTIVATIONAL PROFILES Four motivational profiles are found to be major factors in deciding by the employees to stay or leave the job TURN-OVERS are dissatisfied at work and relatively free from external pressures. They are likely to seize the first opportunity to quit. TURN-OFFS stay with an organisation, physically being kept their by maintenance factors although mentally retired. TURN-ONS are highly motivated individuals whose felt needs are being met at work. They are unlikely to leave unless some external pressure becomes acute or unless a manager significantly reduces the satisfaction they can derive from work. TURN-ONS PLUS are persons who experience a high degree of satisfaction both at work and in local environment they are most likely to stay and remain highly productive. Early warning Signs of Employee Turnover 1. Attendance records both excessive absenteeism and voluntary quits are forms of alienation/psychology withdrawal from organization. 2. Attitude change apathy, irritation & frustration. 3. Lowered productivity and defective work. 4. Large number of informal gribs, formal complaints and grievances. 10

5. Excessive requests for transfers. Recruitment, retention and turnover survey 2005 reported the overall employee turnover rate for the UK is 15.7%. This figure has remained stable for the past three years. Turnover levels vary very considerably from industry to industry. The highest levels of turnover (21.4%) are found in private sector organisations. Successive CIPD surveys of labour turnover show that the highest levels (commonly in excess of 50% per annum) are found in retailing, hotels and restaurants, call centres and among other lower paid private sector services groups. The public sector has an average turnover rate of 11.5%. Staff turnover poses the greatest challenge for the health sector, with a rate of 14.1%. The lowest levels are found among civil servants, fire fighters, the police and other public sector staff groups who are relatively highly skilled and well paid.

Turnover levels also vary from region to region. The highest rates are found where unemployment is lowest and where it is unproblematic for people to secure desirable alternative employment. Contrary to many media reports and statements from consultants and political leaders there is little evidence of any long-term trend towards higher staff turnover. A third of employees in the UK have been in their current jobs for over ten years, while 10% have stayed for over twenty years. Average job tenure has remained remarkably stable over the last thirty years, falling among men but rising among women. As a proportion of aggregate turnover, the percentage of people leaving organsiations through redundancy remains small. Twenty-two per cent of organisations made more than ten people redundant during 2004, and 10% operated a recruitment freeze in the course of the year. The most commonly cited reason for staff turnover is promotion outside the organisation (53%) with lack of development or career opportunities the next at 42%. When does employee turnover become problematic There is no set level of employee turnover above which effects on the employing organisation become damaging. Everything depends on the type of labour markets in which organisation competes. Where it is relatively easy to find and train new employees quickly and at relatively little cost (ie where the labour market is loose), it is possible to sustain high quality levels of service provision despite having a high turnover rate. By contrast, where skills are relatively scarce, where recruitment is costly or where it takes several weeks to fill a vacancy, turnover is likely to be problematic from a management point of view. This is especially true of situations in which the organisation is losing staff to direct competitors or where customers have developed relationships with individual employees as is the case in many professional services organisations. 11

Some employee turnover positively benefits organizations. This happens whenever a poor performer is replaced by a more effective employee, and can happen when a senior retirement allows the promotion or acquisition of welcome 'fresh blood'. Moderate levels of staff turnover can also help to reduce staff costs in organizations where business levels are unpredictable month on month. In such situations when business is slack it is straightforward to hold off filling recently created vacancies for some weeks. 1.5 COMPUTING AND COMPARING TURNOVER RATES Employee turnover is expressed in two rates:SEPARATION Find the average number of employees by adding together the number of the pay roll on first and last days of the month. Then divide this by 2, Divide the total number of separations during the month by this average employment figure. Multiply this number by 100 to get the rate per 100 employees for the month

Separation rate =

Total separation per month Av. Number on months pay roll

Monthly figures may be converted to an annual rate by multiplying the actual monthly rate by a factor equal to 365 divided by number of days a given month. Unless this is done monthly figures are not strictly comparable with annual figures, since months vary in length. In the high turnover industries in particular, a great deal of employee turnover consists of people resigning or being dismissed in the first few months of employment. Even when people stay for a year or more, it is often the case that the decision to leave sooner rather than later is effectively taken in the first weeks of employment. Poor recruitment and selection decisions, both on the part of the employee and employer, are usually to blame, along with poorly designed or non-existent induction programmes. Expectations are often raised too high during the recruitment process, leading people to compete for and subsequently to accept jobs for which they are in truth unsuited. Organisations do this in order to ensure that they fill their vacancies with sufficient numbers of well-qualified people as quickly as possible. However, over the longer term the practice is counter-productive as it leads to costly, avoidable turnover and the development of a poor reputation in local labour markets. 12

Succession The rate of succession, quits, layoffs and discharge can be computed by same basic formula. When the separation rate is subtracted from succession rate, the positive or negative figures show whether employment is expanding or contracting. If avoidable turnover is to measure the quit rate is most useful figure. This may be sub-divided for regular employees with sonority standing and new hires whose status is probationary. Total figure for turnover rates by themselves are relatively useless. They become significant only when compared with rates in other similar organisation. Costing employee turnover It is possible to compute a 'not less than' figure very easily by working out what it costs on average to replace a leaver with a new starter in each of major employment categories. This figure can then be multiplied by the crude turnover rate for that staff group to calculate the total annual cost of turnover. The major categories of costs to take account of are:

administration of the resignation recruitment costs selection costs cost of covering during the period in which there is a vacancy administration of the recruitment and selection process induction training for the new employee.

Many of these costs consist of management or administrative staff time (opportunity costs) but direct costs can also be substantial where advertisements, agencies or assessment centres are used in the recruitment process. More complex approaches to turnover costing give a more accurate and invariably higher estimate of total costs. A widely quoted method involves estimating the relative productivity of new employees during their first weeks or months in a role and that of resignees during the period that they are working their notice.

1.6 IMPROVING EMPLOYEE RETENTION:

The first two steps to be taken when developing an employee retention strategy are to find out: why employees in hard to recruit groups are leaving and what employee turnover among these groups is 13

costing the organisation. Obtaining accurate information on reasons for leaving is harder. Where exit interviews are used it is best to conduct them a short time after the employees hand in their notice. The interviewer should not be a manager who has had responsibility for the individual and who will not be involved in future reference writing. Confidentiality should be assured and the purpose of the interview explained. Alternative approaches involve the use of confidential attitude surveys which include questions about intention to leave and questionnaires sent to former employees on a confidential basis around six months after their departure. A costed retention strategy can then be developed focusing on particular causes of turnover in your organisation.Some remedies that can help to solve the problem: Flexible Work Hours Understand Personal Needs Monetary Issues Work life Issues Right Recruitment Strategies Free Communication Culture The following elements play a positive role in improving retention:

Give prospective employees a 'realistic job preview' at the recruitment stage. Take care not to raise expectations only to dash them later. Where possible invite applicants to work a shift on the job before committing themselves.

Make line managers accountable for staff turnover in their teams. Reward managers whose record at keeping people is good by including the subject in appraisals. Train line managers in effective supervision before appointing or promoting them. Offer re-training opportunities to existing managers who have a poor record at keeping their staff.

Maximise opportunities for individual employees to develop their skills and move on in their careers. Where promotions are not feasible, look for sideways moves that vary experience and make the work more interesting.

Ensure wherever possible that employees have a 'voice' through consultative bodies, regular appraisals, attitude surveys and grievance systems. This helps to ensure that dissatisfied employees have every opportunity to sort out problems before resigning. Where there is no opportunity to voice dissatisfaction, resigning is the only option.

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Wherever possible accommodate individual preferences on working hours. Be as flexible as possible in the allocation of shifts. Where people are forced to work hours that do not suit their domestic responsibilities they will invariably be looking for another job which can offer such hours.

Avoid the development of a culture of 'presenteeism' where people feel obliged to work longer hours than are necessary simply to impress management. Evaluation of individual commitment should be based on results achieved and not on hours put in.

Provide as much job security as possible. Employees who are made to feel that their jobs are precarious may put a great deal of effort in to impress, but they are also likely to be looking out for more secure employment at the same time. Security and stability are greatly valued by most employees.

Bend over backwards to ensure that you do not and are never seen to discriminate against employees on any unfair grounds. A perception of unfairness, whatever the reality when seen from a management point of view, is a major cause of voluntary resignations. While the over all level of pay is unlikely to play a major role unless it is way below the market rate, perceived unfairness in the distribution of rewards is very likely to lead to resignations.

Defend organisation against penetration by headhunters and others seeking to poach your staff. Keep internal e-mail addresses confidential, train telephonists to spot calls from agents and to avoid giving them useful information, refuse to do business with agents who have poached your staff, and enter into pacts with other employers not to poach one another's' staff

Besides all this majority of the companies provide following employee benefits to attract and retain employees:
1. Group Medi-claim Insurance Scheme: This insurance scheme is to provide adequate insurance coverage of employees for expenses related to hospitalization due to illness, disease or injury or pregnancy in case of female employees or spouse of male employees. All employees and their dependent family members are eligible. Dependent family members include spouse, non-earning parents and children above three months 2. Personal Accident Insurance Scheme: This scheme is to provide adequate insurance coverage for Hospitalization expenses arising out of injuries sustained in an accident. This covers total / partial disablement / death due to accident and due to accidents.

15

3. Subsidized Food and Transportation: The organizations provide transportation facility to all the employees from home till office at subsidized rates. The lunch provided is also subsidized. 4. Company Leased Accommodation: Some of the companies provide shared accommodation for all the out station employees, in fact some of the BPO companies also

undertake to pay electricity/water bills as well as the Society charges for the shared accommodation. The purpose is to provide to the employees to lead a more comfortable work life balance. 5. Recreation, Cafeteria, ATM and Concierge facilities: The recreation facilities include pool tables, chess tables and coffee bars. Companies also have well equipped gyms, personal trainers and showers at facilities. 6. Corporate Credit Card: The main purpose of the corporate credit card is enable the timely and efficient payment of official expenses which the employees undertake for purposes such as travel related expenses like Hotel bills, Air tickets etc 7. Cellular Phone / Laptop: Cellular phone and / or Laptop are provided to the employees on the basis of business need. The employee is responsible for the maintenance and safeguarding of the asset. 8. Personal Health Care (Regular medical check-ups): Some of the companies provide the facility for extensive health check-up. For employees with above 40 years of age, the medical check-up can be done once a year. 9. Loans: Many companies provide loan facility on three different occasions:

Employees are provided with financial assistance in case of a medical emergency. Employees are also provided with financial assistance at the time of their wedding. And, the new recruits are provided with interest free loans to assist them in their initial settlement at the work location. 10. Educational Benefits: Many companies have policy to develop the personality

and knowledge level of their employees and hence reimburses the expenses incurred towards

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tuition fees, examination fees, and purchase of books subject, for pursuing MBA, and/or other management qualification at India's top most Business Schools. 11. Performance based incentives: Many companies have plans for performance

based incentive scheme. The parameters for calculation are process performance i.e. speed, accuracy and productivity of each process. The Pay for Performance can be as much as 22% of the salary. 12. Flexi-time: The main objective of the flextime policy is to provide opportunity to employees to work with flexible work schedules and set out conditions for availing this provision. Flexible work schedules are initiated by employees and approved by management to meet business commitments while supporting employee personal life needs .The factors on which Flexi time is allowed to an employee include: Child or Parent care, Health situation, Maternity, Formal education program 13. Flexible Salary Benefits Regular Get together and other cultural programs: The companies organizes cultural program as and when possible but most of the times, once in a quarter, in which all the employees are given an opportunity to display their talents in dramatics, singing, acting, dancing etc. Apart from that the organizations also conduct various sports programs such as Cricket, football, etc and regularly play matches with the teams of other organizations and colleges. 14. Wedding Day Gift: Employee is given a gift voucher of Rs. 2000/- to Rs. 7000/- based on their level in the organization. 15. Employee Referral Scheme: In several companies employee referral scheme is implemented to encourage employees to refer friends and relatives for employment in the organization.

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1.7 RETENTION STRATEGIES

Retention strategies can be classified into two parts: Main and Ancillary. Main retention strategies 1.Communication -

Communication is the first step toward creating the kind of environment that people care about, and if they care, they just may stay. Keep employees in the loop about what's happening with the company. At any time, all of the employees should have a pretty good idea of how business has been, and they should be aware of what issues the company is attempting to address. That means regularly keeping employees up to date with important events affecting the company. If November was good, let them know, tell them what is expected to happen in December. Share good news , as well as points of concern. If there are some "issues," talk about them . And if they don't get resolved, figure out whether the problem stems from a couple of individuals or from the system. The point is that treat employees as partners, which they are. They may not have to worry about covering the payroll , but they do have worries of their own. Treat them with respect. If salespeople, for instance, enjoy their encounters with employer, they are much more likely to greet customers with a positive attitude. They are also much more likely to enjoy their work when they don't have a fire-breathing dragon looking to singe their butts. Employers should listen to employees when they have ideas for improvement. Again, the benefits extend beyond just making people feel appreciated for their contributions. These are, after all, the people who do the work every day. They may have some ideas to improve productivity, and when they do come up with one, let everybody know where it came from. Post a "brag board" in break room, or circulate an internal newsletter that touts these contributions. The payoff is a contagious feeling of pride and, perhaps, some new efficiency that saves the company money. 2) Set Clear Expectations 1. How often do you appraise your employees/team-members? 2. What are your expectations from your employees/team-members? What are the parameters to measure their performance? Have you communicated to them? 3. What will be the consequences, if they fail? 4. What will be the rewards, if they exceed the expected level? 5. If you are not having any expectations, how you are going to appraise, your employees? 18

Employer may get biased if there are no set standards. The role of a CEO, HR Manager is like a director of a movie; choreographer of a stage show, where there is a defined role for each character, each participant. Setting expectations initiates the process. Managers need to sit down with each employee and clearly define what's expected of them. When expectations are not clear, employees may not be in sync with their job's current demands and priorities. Setting expectations is not a once and done activity. Jobs change. Priorities change. Resources change. Managers need to revise and set new expectations throughout the year. Setting expectations revolves around the following three areas: 6. Key job responsibilities 7. Performance factors and standards 8. Goals Setting expectations is very important. This process can be the cornerstone of improving the motivational climate. If employees know what is expected of them, it allows them to focus on results and to monitor themselves against the set standards. Environments in which expectations are not clear, or change from week to week, seldom create high-performing work groups.

The three principles that should drive expectations are clarity, relevance, and simplicity.

Clarity. Expectations should focus on outcomes, not activities. In other words, clarity is achieved when the expected results are identified rather than the method for achieving them. Managers often make the mistake of attempting to direct the process that an employee will use rather than being clear about results. The advantage of identifying the outcome is that the manager, focus only on the goal; after all, the employee will develop the method for achieving the desired results. Defining the objective often requires some thought on the part of the manager because it is easy to fall into the "activities trap." While developing a strategic plan for a department or division is a worthy activity, it does not represent an outcome. In the activities trap, developing a plan is the goal, rather than increasing market share. Relevance. The principle of relevance helps define the "why" of the assignment. If employees have a full understanding of the project's importance, they can make adjustments as unanticipated factors crop up within the process. They probably also will be more committed to the result because they can see more easily how it fits into the big picture and how their efforts impact the company. This understanding typically is accomplished through dialogue between the manager and subordinate, which allows for a more thorough review of the situation and for feedback and discussion. This 19

process builds good will with the employee and sets the stage for additional responsibilities. Simplicity. Simplicity creates a sense of grounding for employees as they endeavor to carry out assignments. If managers identify the work in simple, straightforward terms, employees will find it much easier to follow through on managers' wishes. To accomplish this, a manager must identify the key message in a fashion that the employee can embrace. 3. Proper Rewarding A research reports says that in today's scenario, 9. 70% of employees are less motivated today than they used to be. 10. 80% of employees could perform significantly better if they wanted to. 11. 50% of employees only put enough effort into their work to keep their job. Employee Reward covers how people are rewarded in accordance with their value to an organization. It is about both financial and non-financial rewards and embraces the strategies, policies, structures and processes used to develop and maintain reward systems. The ways in which people are valued can make a considerable impact on the effectiveness of the organization, and is at the heart of the employment relationship. The aim of employee reward policies and practices, in an organization is to help attract, retain and motivate high-quality people. Getting it wrong can have a significant negative effect on the motivation, commitment and morale of employees. Personnel and development professionals will be involved frequently in reward issues, whether they are generalists or specialize in people resourcing, learning and development or employee relations. Following parameters should be kept in mind while designing a reward policy: 4. Build a high degree of recognition value into every reward that is offered: Recognition is the most cost-effective motivator. While the high cost of other rewards forces employers to give them sparingly, recognition can be given any time, at very little cost. Some very ordinary items and events can be imbued with extraordinary motivational significance, far in excess of their monetary value. A pizza or movie tickets can be good motivators if given with sufficient appreciation. A sincere thanks can be delivered at any place and at any time, it costs absolutely nothing and can be more motivationally powerful than a substantial monetary bonus. Organizations can provide innovative recognition in an infinite number of ways.

Highly motivating organizations even celebrate small successes. A health-conscious company distributes fruit bowls to employees' work areas when key personal milestones are attained. 20

5.

Reduce entitlements and link as many rewards

as possible to performance. Attendance

The traditional "pay for loyalty" systems in most organizations need to be changed.

should not be the major criterion for rewards. Most employees resent those who only put in their time and yet receive the same reward as those who go the extra mile. Today's employees have higher expectations for what work can and should be, and they want to receive rewards that reflect their personal efforts and contributions. This is why so many companies are moving toward performancebased rewards, including performance bonuses, gain-sharing and non-monetary recognition. Although not a panacea, companies are finding that these new reward systems do allow them to give substantial rewards to those who really deserve them. Smart organizations are looking for opportunities to reduce across-the-board entitlements, and thereby find more resources for discretionary performance-based rewards, without increasing the total cost of rewards.

6. Troubleshoot reward system to make sure that what it is rewarding is what the employer really wants to happen. The Law of Rewards - "What you reward is what you get" - Is extremely powerful. No matter what job description might say, it is the rewards an organization gives that communicate the real expectations. The most important question to ask in evaluating the reward system in any organization is, do the rewards we are giving elicit the performance that an employer wants? Start with the results to be achieved and then pinpoint the types of behaviors needed to achieve them. For example: 12. If you believe teamwork is going to get the results, make sure you reward teamwork, and not internal competition between departments. 13. If you want quality, make sure that productivity isn't over emphasized. And, 14. If you want long-term solutions, don't reward quick fixes Also, don't confuse employees with too many rewards. It is better to focus rewards on the critical few behaviors and results, rather than diluting them by rewarding the trivial many.

7. Reward promptly. Rewards should be given as soon as possible after the performance has taken place. That is why the most successful gain-sharing programs pay employees monthly, rather than quarterly or annually as in the past. There is a well-accepted law of behavioral psychology, that if you want someone to repeat a behavior, you should positively recognize it immediately. From this law, smart supervisors and managers can learn a vital lesson: Look for any employee doing something and 21

recognize. 8. Give employees a choice of rewards. Rewards are as different as the people who receive them and it doesn't make sense to give rewards that recipients don't find rewarding. For example, some people prefer more pay, while others prefer more time off. A promotion might be more rewarding to one person, while a job-sharing arrangement might be more rewarding for another. Some people are excited about sports events, others about movies. Some employees would love a dinner in a romantic restaurant, others a book by their favorite author. Food, fun, education, improved work environment, gifts, travel, family-oriented activities - the options are endless. Smart organizations are also letting employees choose their own rewards from reward menus and catalogs. Personalizing rewards shows that a company cares enough to discover what "interests" each employee, rather than just distributing generic items

9. Increase the longevity of rewards. This can be done in a number of ways: One of the keys to reward longevity is symbolism. The more symbolic an item is of the accomplishment, the more likely it is to continue reminding the employee of why it was given. For instance, a T-shirt of coffee mug with a meaningful inscription will continue rewarding those who wear it, or use it, long after its initial receipt.

Another way to increase the longevity of rewards in your organization is by using some kind of point system. Rather than rewarding each individual behavior or accomplishment, points can be awarded, which employees can accumulate and eventually trade for items from a reward menu or gift catalog. This keeps the anticipation of rewards fresh for longer periods of time. It also addresses the need for reward individualization. One company that designs motivational systems offers an electronic debitcard system to help larger clients cope with the complexity of distributing, tracking and redeeming employees' points. Employees can use their points to purchase virtually anything they want, from sports equipment and clothing to automobiles and overseas vacations. They only caveat for such programs is to make sure that the recognition value of the rewards isn't lost because of the impersonal nature of the technology. 10. Be continually vigilant of demotivators that may undermine an organization's best efforts to provide power rewards, and reduce them promptly. Most demotivators can be dramatically reduced by soliciting employee involvement in identifying highest-priority demotivators and by enlisting top-management commitment to support their reduction. 22

It is probably self-evident that considerable sensitivity is needed in the administration of any reward system. One demotivator that is probably endemic in any reward system modification (especially as an organization moves from entitlements to more performance-based rewards) is a sense that something is being taken away. Employees need to be educated about the reasons that this is being done, understand the ultimate benefits to them and the organization, and should probably have some input into the change process. To avoid the perception of unfairness, it is important, first and foremost, that the process for allocating rewards is viewed by employees as being impartial. This requires an objective measurement system that few organizations have. Without such objective measurement, any reward system is probably destined to failure.

Ancillary Retention Strategies

11. The quality of the supervision: The quality of the supervision an employee receives is critical to employee retention. People leave managers and supervisors more often than they leave companies or jobs. It is not enough that the supervisor is well liked or a nice person, starting with clear expectations of the employee, the supervisor has a critical role to play in retention. Anything the supervisor does to make an employee feel unvalued will contribute to turnover. Frequent employee complaints center on these areas.

Lack of clarity about expectations, Lack of clarity about earning potential, Lack of feedback about performance, Failure to hold scheduled meetings, and Failure to provide a framework within which the employee perceives he can succeed.

12. The ability of the employee to speak his or her mind :The ability of the employee to speak his or her mind freely within the organization is another key factor in employee retention. If an organization provides an environment in which people are comfortable providing feedback,

employees offer ideas, feel free to criticize and commit to continuous improvement. If not, they bite their tongues or find themselves constantly "in trouble" - until they leave. 13. Talent and skill utilization Talent and skill utilization is another environmental factor that employees seek in workplace. A motivated employee wants to contribute to work areas outside of his 23

specific job description. How many people could contribute far more than they currently do? Employer just need to know their skills, talent and experience, and take the time to tap into it. 14. Fairness and equitable treatment The perception of fairness and equitable treatment is important in employee retention. 15. Growth opportunities: Best employees- those employees that employer want to retain, seek frequent opportunities to learn and grow in their careers, knowledge and skill. Without the opportunity to try new opportunities, sit on challenging committees, attend seminars and read and discuss books, they feel they will stagnate. A career-oriented, valued employee must experience growth opportunities within the organization. 16 .Behaviour of senior managers: A commonplace complaint or lament heard during an exit interview is that the employee never felt senior managers knew he existed. Take time to meet with new employees to learn about their talents, abilities and skills. Meet with each employee periodically. It's a critical tool to help employees feel welcomed, acknowledged and loyal. 17. Never threaten : No matter what the circumstances are but never, never, ever threaten an employee's job or income. It is a mistake to foreshadow this information with employees. It makes them nervous, think before saying anything that makes people feel they need to search for another job.

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INDUSTRY PROFILE

INTRODUCTION

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2.1 COMMUNICATION INDUSTRY

The communication industry has witnessed astronomical growth over the last decade and half. The Government of India broke away from its traditional out look of monopoly-market to open-market policy. As a result of economic renaissance in India, different Indian industries grew to record heights in record time. The success of India telecommunication industry is also note worthy and its contribution to the overall growth of the Indian economy is well known. Indian Communications Industry Overview suggests that although, this industry has matured tremendously over the last fifteen years but huge scope of growth still waits to be explored. The urban India is more or less well connected with basic telephony but the semi-rural area needs immediate attention. Further, the most important and untapped area is the rural- India and huge scope of growth is lying still untapped. The Government of India is focused on the development and faster growth of rural-telephony in rural India and such that it has equipped the latest telecommunication policy with host of fiscal incentives and tax rebates to attract investors, both domestic and foreign investors.

The factors, which contributed for success of Indian telecommunication industry, are as follows

Friendly Government of India economic and telecommunication policies Low operational cost Availability of world class infrastructure at a much cheaper cost Availability of huge English speaking workforce Prevalence of strong technical education amongst the majority of educated Indians Large number of science and engineering graduates Assurance of high quality output Highly skilled workforce Usage of innovative technologies Effective and efficient entrepreneurship skills Good client and service provider's relationships Creation of global brands Huge scope of business across all industries especially, in IT and ITES industries Expansion of existing relationships Ever growing domestic market, especially the rural market

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Huge success in overseas markets Increased electronics and hardware manufacturing in India Aggressive promotion of R&D in telecommunication Increased penetration of computers Increased utilization of Internet Growth of domestic software market Development of local language software, especially for the use in rural- India Use of Information Technology to increase productivity Use of Information Technology as a means of generating employment Increased number and quality of training facilities across India

With 110.01 million connections, the Indian telecommunication industry is the fifth largest and fastest growing telecommunication industry in the world. In the last 3 years, two out of every three new telephone connections were wireless and it accounts for around 54.6% of the total telephone subscriber base in India, as compared to only 40% in 2003. The wireless technologies those are currently in use in this Indian industry are Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA). The Indian telecommunication industry now has 9 GSM and 5 CDMA operators providing mobile service in 19 telecommunication circles and 4 metro cities, connecting more than 2000 towns across India. The Telecom Regulatory Authority of India (TRAI) regulates the Indian telecommunication industry. It has earned good reputation for transparency and competence. Three types of operators function in this industry

State owned companies like - VSNL, BSNL and MTNL. Private Indian companies like - Reliance Infocomm and Tata Teleservices. Foreign companies like - Hutchison-Essar, Bharti Tele-Ventures, Escotel, Idea Cellular, BPL Mobile, Spice Communications etc.

Further, the Indian Communications Industry Overview suggests that the services of this industry are not confined to basic telephony but it also extends to Internet, broadband (both wireless and fixed), cable TV, SMS, IPTV, soft switches etc.

The bottlenecks for the Indian telecommunication industry are as follows -

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Slow telecommunication reform process Low penetration capability in rural India. Service providers bears huge initial cost for establishment of basic infrastructure and achieving break-even is difficult

Huge initial capital investments Limited spectrum availability and high interconnection charges between the private and state operators

The Government of India Broadband Policy 2004 aims at 9 million broadband connections and 18 million Internet connections by the end of financial year 2007 - 2008. The Indian telecommunication industry is expected to contribute nearly 1% to India's GDP.

2.2 Telecommunication Companies in India

The stupendous growth of the telecommunication companies in India over the last fifteen years can be attributed to the liberal government of India, economic policy. The economic renaissance effected in the early 1990s brought around a paradigm shift on the overall business scenario of India. The telecommunication companies in India went through a huge make-over during the implementation of the open-market policy of India. The erstwhile closed market policy was replaced by a more liberal form of economic policy. A whole new form of Indian Telecommunication Policy was drafted to compliment the change effected in the economic policy of India. The amendment effected the new telecommunication policy of India made huge changes with respect to investments and entry of Foreign Direct Investments (FDI) and Foreign Institution Investors (FII) respectively, into the virgin Indian telecommunication market. This resulted entry of private, domestic and foreign telecommunication companies in India. The economic contribution made by these newly formed telecommunication companies of India is really mentioned worthy and this industry witnessed highest growth after the Indian Information Technology industry. The robust growth of Indian economy after the economic liberalization in the 1990s induced massive change in the telecom policy and new draft was framed and implemented by the 'Telecom Regulatory Authority of India' (TRAI) and 'Department of Telecommunication' (DOT), under the Ministry of Telecommunication government of India. The main aim of these telecommunication companies in India is to provide basic telephony services to each and every Indian. With the advent of private telecommunication companies in India, the industry witnessed introduction of mobile telephones into the Indian market and it became popular 28

amongst the Indian masses in no time. Today two types of mobile phone service providers operates in the Indian market, like the following

Global System for Mobile Communications (GSM) Code Division Multiple Access (CDMA)

The main binding objective for all the telecommunication companies operating in India are as follows

To facilitate telecommunication for all Ensuring quick availability of telephone connectivity Achieve universal service access at affordable price covering all Indian villages, as early as possible

Providing world class telecommunication services Solving consumer complaints, resolve disputes, and special attention to be given to public interface

To provide widest possible range of services at reasonable prices To emerges as a major manufacturing base and major exporter of telecommunication equipment

To protect the defense and security interests of the country

BHARAT SANCHAR NIGAM LTD. VIDESH SANCHAR NIGAM LTD. MAHANAGAR TELEPHONE NIGAM LTD. BHARTI AIRTEL VODAFONE RELIANCE COMMUNICATIONS TATA TELESERVICES SPICE TELECOM IDEA CELLULAR SASKEN NETWORK ENGINEERING LTD.

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BPL MOBILE COMMUNICATIONS LTD.

The

Communications Industry Analysis of India suggests that the industry has registered

phenomenal growth since, the 1990s. The Government of India came out of its old monopoly-market concept to open-market policy regime. This resulted economic renaissance in India and different Indian industries grew to record heights in record time. The success of India telecommunication industry is also mention worthy and its contribution towards the overall health of Indian economy is substantially high. The Indian Communications Industry Analysis indicates that although, this industry has matured tremendously over the last fifteen years but huge scope of growth still waits to be explored. The urban India is more or less well connected with basic telephone services but the semi-rural area needs immediate attention. The most important and unexplored area is the rural- India and huge scope of growth is lying still untapped. The Government of India is now more focused on faster development of ruraltelephony in rural parts of India. The latest telecommunication policy offers host of fiscal incentives and tax rebates to attract investors, both domestic and foreign investors. Telecom Regulatory Authority of India or the TRAI regulates the telecommunication industry of India. It has earned good reputation for transparency and competence. Three types of operators function in this industry. With 110.01 million connections, the Indian telecommunication industry is the fifth largest and fastest growing telecommunication industry in the world. The subscriber base of the Indian telecommunication industry has grown by 40% in the year 2005 and is projected to touch 250 million by the end of the financial year 2007. In the last 3 years, two out of every three new telephone connections were wireless and today it accounts for about 55% of the total telephone subscription in India, as compared to only 40% in 2003. The wireless subscriber growth in India is expected to add 2.5 million new subscribers in every month of the financial year 2007-2008. The wireless subscriber base in India, rose from 33.69 million subscription in 2004 to 62.57 million subscription in the financial year 2004 -2005. The wireless technologies those are currently operating in the Indian telecommunication industry are Global System for Mobile Communications (GSM) and Code Division Multiple Access (CDMA). The Indian telecommunication industry now has 9 GSM and 5 CDMA service providers serving in 19 circles and 4 metro cities and connecting more than 2000 towns across the length and breadth of India. Further, the Indian Communications Industry Analysis suggests that the products and services offered by this industry is not confined to basic land line connections but it also includes facilities like Internet, broadband (both wireless and fixed), cable TV, SMS, Internet Protocol TV (IPTV), soft switches etc.

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The analysis of the tenth plan of the Indian communication industry is as follows

Creating world class telecommunication infrastructure to meet the requirements of IT, ITES, media and other IT based industry

Easy and affordable access to basic telecommunication services across India Affordable and effective basic telecommunication facilities to each and every Indians Facilitation of world class service to all uncovered and rural areas of India Establishing a modern and efficient telecommunication infrastructure to meet the requirements of modern industrial nation

Continual modernization of the Indian telecommunication industry and provide an equal opportunity for all the telecommunication

service providers operating in India Strengthening R&D in telecommunication Efficient and transparent spectrum management Enabling efficient protection of the defense and security systems of the country Facilitating the Indian telecommunication companies to be at par with other global players

Facilitate world class services at affordable prices Institutionalize the Department Of Telecommunication, Government of India and help it function as a corporate body

To make telephone available on demand To reach tele-density of 9.91 by 31st March 2007 Facilitate reliable media to all telephone exchanges Facilitate high-speed data and multimedia connections using technologies like ISDN to all towns with population strength of two lakh or more.

2.3 Telecommunication Sector Opportunities

Telecommunication Sector Opportunities in India have grown phenomenally in the past 3 years as has been surveyed by Indian Ministry of Communications and Information Technology in New Delhi very recently. The telecom sector is one of the leading contributors to India's flourishing economy. According to the report presented by taking into account the statement of Indian Ministry of Communications and Information Technology, the telecom opportunities in India has been growing by 20 to 40 percent every year since past 3 years. The telecom services in India have been recognized as a world-class tool for the socio-

31

economic development in India. India is known to rank fourth in the telecom industry in Asia after China, Japan, and South Korea and the telecom network in India is known to stand in the eighth position across the globe and second among the emerging economies. The teledensity has grown leaps and bounds in the past few years from 2.3 percent in 1999 to 4.8 percent in 2002. The world average percentage for the telecom industry as against the Indian average is 7.5 times while the Asian average against the same was 4.5 times. The current market range of the telecommunication industry in India has been estimated to USD 8 billion and this is expected to undergo an accretion by the end of 2012. The growth witnessed by the telecom market in India has increased the number of opportunities for the industry and this has been fueled by the growing mobile sector, which has attained the consumer level of 10 million by the end of December 2002 that was almost 100 percent in the year. This outstanding growth in the mobile sector explains the advent of digital cellular technology and reduced tariffs as a consequence of competitive pressures. The growth in the cellular subscribers has surpassed the benchmark of subscriber base. The telecom market has increased dramatically with the advent of Wireless in Local Loop Technology. Telecommunication Sector Opportunities in India assures a transparent, safe, and secured ambiance for the telecom market. Around 300 million population of highly consumable middle-class status that is advantageous for the industry surrounds the telecom sector in India. This is because, in some of the Indian that possess land line telephones can be substituted by mobile phones that is very unlike the developed countries. Therefore, it adds up to the growth in mobile sector in Indian telecom industry. Few more Telecommunication Sector Opportunities in India include introduction of Internet telephony services, privatization of VSNL, and introduction of a number of international long distance services sector. The opportunities in the Indian telecom sector is increasing at a massive pace with the introduction of newer and innovative schemes in various sectors and at present the telecom sector in India is claimed to be one of the major contributors in India's flourishing economy

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COMPANY PROFILE

3.1 RELIANCE COMMUNICATIONS

The Late Dhirubhai Ambani dreamt of a digital India an India where the common man would have access to affordable means of information and communication. Dhirubhai, who single-handedly built Indias largest private sector company virtually from scratch, had stated as early as 1999: Make the tools of information and communication available to people at an affordable cost. They will overcome the handicaps of illiteracy and lack of mobility. It was with this belief in mind that Reliance Communications (formerly Reliance Infocomm) started laying 60,000 route kilometres of a pan-India fibre optic backbone. This backbone was commissioned on 28 December 2002, the auspicious occasion of Dhirubhais 70th birthday, though sadly after his unexpected demise on 6 July 2002. Reliance Communications has a reliable, high-capacity, integrated (both wireless and wireline) and convergent (voice, data and video) digital network. It is capable of delivering a range of services spanning the entire infocomm (information and communication) value chain, including infrastructure and services for enterprises as well as individuals, applications, and consulting. Today, Reliance Communications is revolutionising the way India communicates and networks, truly bringing about a new way of life.

3.2 VISION We will leverage our strengths to execute complex global-scale projects to facilitate
leading-edge information and communication services affordable to all individual consumers and businesses in India. We will offer unparalleled value to create customer delight and enhance business productivity. We will also generate value for our capabilities beyond Indian borders and enable millions of India's knowledge workers to deliver their services globally.

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3.3 BUSINESS
Reliance Communications started its operations in 1999 and is under the Anil Dhirubhai Ambani Group (ADAG) of companies. The company Reliance Communications Limited has been set up with the aim of providing communication and information to people at affordable price.

The company Reliance Communications business includes the whole range of services related to the telecom sector such as fixed line telephones and mobiles. The business of the company also includes services like broadband, data services, international and national long distance services. Reliance Communications also provides to its customers a wide range of value added applications and services. The company is able to provide such a vast range of services to its customers for it has a high- capacity, reliable, convergent, and integrated digital network. The Company Reliance Communications Limited in order to provide the best quality of services to its customers laid down 60,000 kilometers of optic fiber all across India. The company launched the Reliance Mobile services in December 2002 and this has helped to increase the subscriber base of the company. The company Reliance Communications Limited's subscriber base has increased a lot over the years and at present stands at 38 million. The company provides telecommunication services to individuals and enterprises. Reliance Communications Company has become the leading telecommunication integrated company in India and the chairman of the company is Anil Ambani.

Reliance Communications Company's total revenue amounted to Rs.35, 260 million in 20052006 and the next year, this figure stood at Rs.45, 785 million. The net profit of the company amounted to Rs.7, 023 million and the next year, this figure increased to Rs.13, 046 million. This shows that the company Reliance Communications Limited's total revenue and net profit has registered a significant growth in one year. The company is listed on the Bombay Stock Exchange and National Stock Exchange. The company Reliance Communications Limited added a record number of subscribers in December 2006 that is 1.4 million. The company Reliance Communications Limited's market capitalization reached the top with Rs.1 lakh crore on the Bombay Stock Exchange in February 2007. The company has bagged the EGovernance project of the West Bengal government in May 2007. The company Reliance

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Communications has won the Frost and Sullivan Market Leadership Award in October 2005 and also the CDMA Industry Achievement Award for International Leadership in October 2004. This shows that Reliance Communications has been doing very good work that has been recognized by the industry. And this is the reason that the company has received so many awards. Reliance Communications Limited further plans to expand its operations and also plans to upgrade its technology. This is sure to help the company serve its customers better and will also increase its subscriber base. The Company Reliance Communications Limited should always try to provide the best quality of services to its customers for this would lead to customer satisfaction and loyalty. And this will in turn help the company to grow and prosper even more. Reliance Anil Dhirubhai Ambani Group, an offshoot of the Reliance Group founded by Shri Dhirubhai H Ambani (1932-2002), ranks among Indias top three private sector business houses in terms of net worth. The group has business interests that range from telecommunications (Reliance Communications Limited) to financial services (Reliance Capital Ltd) and the generation and distribution of power (Reliance Infrastructure Limited). Reliance ADA Groups flagship company, Reliance

Communications, is India's largest private sector information and communications company, with over 71 million subscribers. It has established a pan-India, high-capacity, integrated (wireless and wireline), convergent (voice, data and video) digital network, to offer services spanning the entire infocomm value chain. Other major group companies Reliance Capital and Reliance Infrastructure are widely acknowledged as the market leaders in their respective areas of operation. Business encompasses a complete range of telecom services covering mobile and fixed line telephony. It includes broadband, national and international long distance services and data services along with an exhaustive range of value-added services and applications. Our constant endeavor is to achieve customer delight by enhancing the productivity of the enterprises and individuals we serve. Reliance Mobile (formerly Reliance India Mobile), launched on 28 December 2002, coinciding with the joyous occasion of the late Dhirubhai Ambanis 70th birthday, was among the initial initiatives of Reliance Communications. It marked the auspicious beginning of Dhirubhais dream of ushering in a digital revolution in India. Today, we can proudly claim that we were instrumental in harnessing the true power of information and communication, by bestowing it in the hands of the common man at affordable rates. We 35

endeavor to further extend our efforts beyond the traditional value chain by developing and deploying complete telecom solutions for the entire spectrum of society.

About Sh. Dhirubhai Ambani

Few men in history have made as dramatic a contribution to their countrys economic fortunes as did the founder of Reliance, Sh. Dhirubhai H Ambani. Fewer still have left behind a legacy that is more enduring and timeless. As with all great pioneers, there is more than one unique way of describing the true genius of Dhirubhai: The corporate visionary, the unmatched strategist, the proud patriot, the leader of men, the architect of Indias capital markets, the champion of shareholder interest. But the role Dhirubhai cherished most was perhaps that of Indias greatest wealth creator. In one lifetime, he built, starting from the proverbial scratch, Indias largest private sector enterprise. When Dhirubhai embarked on his first business venture, he had a seed capital of barely US$ 300 (around Rs 14,000). Over the next three and a half decades, he converted this fledgling enterprise into a Rs 60,000 crore colossusan achievement which earned Reliance a place on the global Fortune 500 list, the first ever Indian private company to do so. Dhirubhai is widely regarded as the father of Indias capital markets. In 1977, when Reliance Textile Industries Limited first went public, the Indian stock market was a place patronised by a small club of elite investors which dabbled in a handful of stocks. Dhirubhai managed to convince a large number of first-time retail investors to participate in the unfolding Reliance story and put their hard-earned money in the Reliance Textile IPO,

36

promising them, in exchange for their trust, substantial return on their investments. It was to be the start of one of great stories of mutual respect and reciprocal gain in the Indian markets. Under Dhirubhais extraordinary vision and leadership, Reliance scripted one of the greatest growth stories in corporate history anywhere in the world, and went on to become Indias largest private sector enterprise. Through out this amazing journey, Dhirubhai always kept the interests of the ordinary shareholder uppermost in mind, in the process making millionaires out of many of the initial investors in the Reliance stock, and creating one of the worlds largest shareholder families

CHAIRMANS PROFILE :

Anil D. Ambani

Regarded as one of the foremost corporate leaders of contemporary India,Shri Anil D Ambani, 48, is the chairman of all listed companies of the Reliance ADA Group, namely, Reliance Communications, Reliance Capital, Reliance Energy and Reliance Natural Resources limited. He is also Chairman of the Board of Governors of Dhirubhai Ambani Institute of Information and Communication Technology, Gandhi Nagar, Gujarat. Till recently, he also held the post of Vice Chairman and Managing Director of Reliance Industries Limited (RIL), Indias largest private sector enterprise. Anil D Ambani joined Reliance in 1983 as Co-Chief Executive Officer, and was centrally involved in every aspect of the companys management over the next 22 years.

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He is credited with having pioneered a number of path-breaking financial innovations in the Indian capital markets. He spearheaded the countrys first forays into the overseas capital markets with international public offerings of global depositary receipts, convertibles and bonds. Starting in 1991, he directed Reliance Industries in its efforts to raise over US$ 2 billion. He also steered the 100-year Yankee bond issue for the company in January 1997. Wharton Board of Overseers, The Wharton School, USA

Central Advisory Committee, Central Electricity Regulatory Commission Board of Governors, Indian Institute of Management, Ahmedabad Board of Governors Indian Institute of Technology, Kanpur In June 2004, he was elected for a six-year term as an independent member of the Rajya Sabha, Upper House of Indias Parliament a position he chose to resign voluntarily on March 25, 2006. Conferred the CEO of the Year 2004 in the Platts Global Energy Awards

Rated as one of Indias Most Admired CEOs for the sixth consecutive year in the Business Barons TNS Mode opinion poll, 2004

Conferred The Entrepreneur of the Decade Award by the Bombay Management Association, October 2002

Awarded the First Wharton Indian Alumni Award by the Wharton India Economic Forum (WIEF) in recognition of his contribution to the establishment of Reliance as a global leader in many of its business areas, December 2001

Selected by Asiaweek magazine for its list of Leaders of the Millennium in Business and Finance and was introduced as the only new hero in Business and Finance from India, June 1999.

BOARD OF DIRECTORS:

Shri Anil D. Ambani - Chairman Prof. J Ramachandran Shri S.P. Talwar

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Shri Deepak Shourie Shri A.K.Purwar

3.4 MILESTONES
1999

"Make a phone call cheaper than a postcard and you will usher in a revolutionary transformation in the lives of millions of Indians" - Dhirubhai Ambani 2000 Optic fibre laying process commences in Gujarat, Andhra Pradesh & Maharashtra 2001 First Media Convergence Node made "Ready for Electronics" at Jaipur 2002 First Base Transceiver Station (BTS) made "Ready for Electronics" Obtains International Long Distance License from Govt. of India Establishes 1st Point of Interconnect (POI) in New Delhi . Hon'ble Prime Minister of India, Atal Behari Vajpayee e-inaugurates Reliance Infocomm 2003 Introduces Dhirubhai Ambani Pioneer Offer for Reliance IndiaMobile service Launches Reliance WebWorld in top 16 cities Launches International Long Distance Services Commissions all backbone rings

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Introduces colour handsets Sets world record - acquires one million customers in 10 days. Launches R Connect Internet connection cable Launches integrated broadband centre at Reliance WebWorld, Bangalore Deploys pilot of Home Netway in Mumbai Reliance becomes India's largest mobile service provider within 7 months of commercial launch. Customer base touches 5 million Migrates to Unified License Regime Launches National Roaming Launches International SMS to 159 countries launched 2004 International wholesale telecommunications service provider, FLAG Telecom

amalgamates with Reliance Gateway, a wholly owned subsidiary of Reliance Infocomm Reliance subsidiary Flag Telecom announces FALCON Project - a major new Middle East Loop Terabits Submarine Cable System with links to Egypt and Hong Kong via India Reliance Infocomm launches multi-player gaming on RIM handsets - a first in India Reliance IndiaMobile introduces International Roaming facility to 172 countries, 300 networks. Reliance Infocomm receives the Most Promising Service Provider of the Year 2003 (Asia Pacific) award at the Asia Pacific Technology Awards instituted by Frost & Sullivan Mukesh D. Ambani, Chairman, Reliance Infocomm, receives Voice & Data "Telecom Man of the Year" award Mukesh Ambani voted the worlds most infuential telecom person by UK-based publication Total Telecom.

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Reliance Infocomm bags the CDMA Development Group's 3G CDMA Industry Achievement Award for International Leadership. 2005 Reliance introduces first e-recharge facility in CDMA in India. Reliance IndiaMobile announces mega rural plan to cover 4 lakh villages and 65 crore Indians by December 2005. Anil Ambani appointed Chairman of Reliance Infocomm Air Deccan and Reliance WebWorld join hands to offer air ticket booking facility at Reliance WebWorld XLRI's Post-Graduate Certificate programme in Logistics Supply Chain Management (PGCLSCM) launched on Reliance WebWorld's virtual classroom platform. first of its kind e-learning programme in India.. Reliance Infocomm tied-up with the Bombay Stock Exchange to make available live stock quotes on its mobile phones. Apollo Hospital and Reliance Infocomm join hands to provide top class healthcare service to millions of Indians in over a hundred Indian cities. Reliance WebWorld wins Frost & Sullivan Market Leadership Award for Video Conferencing services. Reliance Infocomm hosts the 4th global CDMA Operators Summit.. Reliance Infocomm and China Telecom sign agreement for telecom services to provide direct telecommunication service, including a global hubbing service, to subscribers in the two countries. 2006 Reliance Demerger adds record Rs.55, 000 Crore to shareholder wealth TIMES NOW launched on Reliance Mobile Phones, making it the worlds first TV channel to be launched on a mobile phone.

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Reliance

Communications

Ventures

Ltd.

(RCVL),

India's

leading

integrated

telecommunications company, a member of the Reliance - Anil Dhirubhai Ambani group, lists on the Bombay Stock Exchange and National Stock Exchange. Reliance Infocomm becomes Indias first telecom operator to launch seamless interstandard international roaming service - 1World.1Number, with single number on international CDMA and GSM networks. Reliance Communications launches Indias first Talking Message Service (TMS) enabling its mobile users to send voice messages to not only other mobiles but also fixed wireless phones (FWP) and landlines. Reliance Communications ties up with Disney to offer on Reliance Mobile World India's first 3D animation on mobile. Reliance Communications launches 'Hello Capital Plan' to enable its subscribers in 19 state capitals to call each other at the local call rate of 40 paise per minute. 2007 Reliance Communications adds a record 1.4 million subscribers in December 06 Reliance Communication launches unique "Simply 2030" plan on Reliance Hello Reliance joins Lenovo and Intel for "Internet on the Move" Reliance Communications market capitalization tops Rs 1 lakh crore ( 1 trillion rupees or 24.39 billion US dollars) on Bombay Stock Exchange Reliance Commu Search Jobs & Classified Ads from Reliance Mobile World - Reliance Communications ties up with Naukri.com nications offers best value on roaming Reliance Communications ushers in Virtual Global Conference Network Reliance Communications launches Roam Jamaica on Reliance Mobile Reliance Mobile launches ' Suno Zee Demerger of Passive Infrastructure division Reliance Communications & Reliance Telecom approved by the Bombay High Court

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Govts Rural Telephone Scheme (RDEL) through Reliance Communications successfully closes by March 31,2007 Reliance Communications unleashes the power of mobile advertising Reliance Communications ties up with SUN TV to offer video streaming of all SUN TV programs online Reliance World, BIMTECH & Philadelphia University unveil Executive Program in Retail Management (EPRM) Reliance Communications ties up with Cisco to launch Business Internet Services for SMEs in Pune RCOM join hands with Yatra.com for air and hotel bookings Reliance Communications brings 'Durgotsav Live' Videocast on mobile Reliance Communications adjudged Worlds Top CDMA Operator at the Global CDMA Industry Achievements Awards Fete 2008 Yahoo partners with Reliance Communications to provide Yahoo One Search for its CDMA and GSM customers. Reliance Mobile strengthens its religious content portfolio on Mobile by tie-up with Sadhana TV HDFC Bank ties up with RCOM, turns every Reliance Mobile into a credit card Reliance Communications announces ESOPs for over 20,000 employees Corporation Bank Launches Banking Services on Reliance Mobile World Reliance Communications and HTC forge Strategic Alliance Reliance Globalcom unit Reliance Infocom BV, Netherlands acquires Global WiMAX Operator eWave WorldReliance Communications and Alcatel form Joint Venture to offer Managed Network Services to telcos across the globe

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REVIEW OF LITERATURE
Bonnie S. Billingsley (1993) The primary purpose of the paper Teacher Retention and Attrition-in Special and General Education is to provide a context for understanding special educators' career decisions. Research findings are organized around a conceptual model of teachers' career decisions that includes three major factors: (a) external (e.g., societal, economic, and institutional), (b) employment (e.g., professional qualifications, work conditions and rewards, commitment, and employability), and (c) personal (e.g., demographics, family, and cognitive/ affective). Conceptual and methodological considerations related to attrition/retention research are also considered. Daniel G. Spencer ,(1986) The study entitled Employee Voice and Employee Retention investigates the relationship between the extent to which employees have opportunities to voice dissatisfaction and voluntary turnover in short-term, general care hospitals. Results show that, whether or not a union is present, high numbers of mechanisms for employee voice are associated with high retention rates.

Jennifer L. Glass, University of Iowa and Lisa Riley, Creighton University (1998) The study Family Responsive Policies and Employee Retention Following Childbirth, shows Women's labor force decisions following childbirth are often pivotal in determining their later occupational attainment. This article looks at the determinants of job changing and labor force interruptions among employed women following childbirth, focusing on the work conditions and benefits provided by organizations. Using interviews with 324 randomly selected employed pregnant women, turnover behavior was modeled across the first year postpartum with information on family characteristics, workplace policies in the respondent's last job, and child care use. Results showed that several employer policies significantly decreased job attrition after controlling for the effects of wages, partner's income, and number of existing children-the most important being the length of leave available for childbirth and the ability to avoid mandatory overtime upon return. Supervisor and coworker social support were also effective in preventing turnover among childbearing women. Results also showed some important differences in the causes of turnover that resulted in labor force exits rather than job changes. All else equal, women who held traditional ideas about mothers'

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responsibilities for home and child care were considerably more likely to experience a labor force interruption following childbirth than others. John E. Sheridan, University of Alabama (1992) This study Organizational Culture and Employee Retention investigated the retention rates of 904 college graduates hired in six public accounting firms over a six-year period. Organizational culture values varied significantly among the firms. The variation in cultural values had a significant effect on the rates at which the newly hired employees voluntarily terminated employment. The relationship between the employees' job performance and their retention also varied significantly with organizational culture values. The cultural effects were stronger than the combined exogenous influences of the labor market and the new employees' demographic characteristics. The cultural effects are estimated to have resulted in over six million dollars' difference in human resource costs between firms with different cultural values. Implications for research on person-organization fit are discussed.

Richard M. Steers Cornell University (1977) The study Antecedents and Outcomes of Organizational Commitment proposes and tests a preliminary model concerning the antecedents and outcomes of employee commitment to organizations using a cross-validational framework. The study was carried out among 382 hospital employees and 119 scientists and engineers. It was found that for both samples personal characteristics, job characteristics, and work experiences influenced commitment. Moreover, commitment was found to be strongly related to intent and desire to remain for both samples and moderately related to attendance and turnover for one sample. Performance was generally unrelated to commitment.

Prof. Biswajeet Pattanayak Life interest- key to retain your best employees explains main cause of consternation among the performers either senior level people or the freshers is lack of satisfaction with their jobs. It calls for identifying their deeply embedded life interests and psychology for work satisfaction. Organisation can immensely benefit if they can align job roles to life interests of employees.

A K Sreekanth In employee engagement and retention says that people dont change their organisations, they change their bosses in an insightful management truth. Apart from this, employees 45

choose to work for the firm, which can provide them most valuable employment offer. Best talent within the organisation should be made insular to the external world so that loyalty of productive employee is ensured on a continuous basis to an organization. Moreover best turnover rate is not necessarily lowest turnover rate. Therefore employee retention rate goal needs to reflect both employee performance and talent mix management goals.

Paul L. Gerhardt, Jr. Study entitled Employee Retention Through Job Satisfaction shows that employers have a need to keep employees from leaving and going to work for other companies. This is true because of the great costs associated with hiring and retraining new employees. The best way to retain employees is by providing them with job satisfaction and opportunities for advancement in their careers. Eskildsen and Nussler (2000) suggest that employers are fighting to get talented employees in order to maintain a prosperous business. Mark Parrott (2000) believes that, there is a straight line between employee satisfaction and customer satisfaction. He believes that todays employees pose a complete new set of challenges, especially when businesses are forced to confront one of the tightest labor markets in decades. Therefore, it is getting more difficult to retain employees, as the pool of talent is becoming more-and more tapped-out. The research focuses primarily on employee retention through job satisfaction. Employees that are satisfied and happy in with their jobs are more dedicated to doing a good job and taking care of customers that sustain the operation (Hammer 2000; Marini 2000; Denton 2000). Job satisfaction is something that working people seek and a key element of employee retention. Every person will have his or her own definition of what it means to be satisfied with a job. Studies show that employees who are satisfied with their jobs are more productive, creative and be more likely to be retained by the company (Eskildsen & Dahlgaard 2000; Kim 2000; Kirby 2000; Lee 2000; Money 2000; Wagner 2000). Research has shown that there may be many environmental features that can be created and maintained to give employees job satisfaction. Pay and benefits, communication (Brewer 2000; Employee 2000; Money 2000; Wagner 2000), motivation, justice (Kirby 2000; Tristram 2000) and leisure time (Rabbit 2000; Wilson 2000) all seem to play a part as to whether employees are satisfied with their jobs, according to studies.

46

Eric G. Lambert, Nancy Lynne Hogan, Shannon M. Barton (2001) The impact of job satisfaction on turnover intent: a test of a structural measurement model using a national sample of workers shows that f or the past century, worker turnover has been of keen interest for both managers and researchers. Based upon the literature, a structural measurement model incorporating four core antecedents of turnover (i.e., demographic characteristics, work environment, job satisfaction, and turnover intent) was developed and tested using a national sample of American workers. The results indicate that the work environment is more important in shaping worker job satisfaction than are demographic characteristics, and that job satisfaction is a highly salient antecedent of turnover intent. Finally, job satisfaction is a key mediating variable between the work environment and turnover intent.

Richard F. Ghiselli, Joseph M. La Lopa, Billy Bai (2001) Job satisfaction, life satisfaction, and turnover intent among food-service managers is a study of more than 400 food-service managers found that well over one-fourth of the respondents intended to leave their position in the near futurewith at least half of those planning to depart the food-service business entirely. Even among the managers who were reasonably content with their jobs in the near term, two out of five thought it was unlikely that they'd stay with their company for five years. The top reason given by the respondents for wanting to leave was salary and benefits. Given previous studies of reasons for turnover, the authors examined the extent of a connection between turnover intention and the following factors: job satisfaction, life satisfaction, and inter-role conflict, and such demographic variables as age, tenure, race, and gender. Three of those factors had a significant effect on respondents' intent to leave in the short term: intrinsic job satisfaction, life satisfaction, and age. In each case, the higher the value of the variable (more satisfaction, greater age), the less likely the chances of turnover. Satisfaction also played a significant part in expectations of long-term turnover

Morris H. Stocks, J. Russell Hardin (2001) A comparison of job attitudes and turnover intentions among CPAs in public, private and governmental work settings This study examines the differences among several attitudinal variables using CPAs from three work settings. The work settings include public accounting, private industry accounting,

47

and governmental accounting. This study uses General Linear Models to investigate the effect of work setting on the attitudinal variables of organizational commitment and job satisfaction and the effect of work setting on the behavioral variable of turnover intentions. Work setting was observed to significantly affect the reported levels of organizational commitment, job satisfaction, and turnover intentions. The results of the study also suggest that governmental CPAs and private industry CPAs do not differ with regard to the attitudinal variables addressed in this study. A confirmatory factor analysis of IS employee motivation and retention It is widely recognized that the relationships between organizations and their IS departments are changing. This trend threatens to undermine the retention of IS workers and the productivity of IS operations. In the study reported here, we examine IS employees motivation and intent to remain using structural equation modeling. A survey was conducted among existing IS employees and analyzed with LISREL VIII. Results showed that latent motivation has an impact on latent retention, with job satisfaction and perceptions of management on career development as indicator variables for the former, and burnout, loyalty, and turnover intent as indicator variables for the latter. Implications for management in developing strategies for the retention of IS employees are provided.

48

RESEARCH METHDOLOGY

Research means re- searching the information. Research is an academic activity and as such the term should be used in technical sense. Research comprises defining and redefining problems, formulating hypothesis or suggested solution, collecting, organizing and evaluating data, making deductions and reaching conclusions. Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically.

Research methodology is a design to systematically solve the problem. In research methodology, we not only talk of research methods but also consider the logic behind the methods. The purpose of the methodology section is to describe the research procedure. It includes the overall research design, the sampling procedures, the data collection methods, the field methods and analysis procedures. The chapter describes the scope of research works, research design, data collection methods, sampling design, data analysis and finally the limitation in the project The study is based on survey and fact finding enquiries with the employees working in RELIANCE COMMUNICATIONS LTD. It is aimed at collecting the relevant data and its optional usage keeping in view the objectives of the project.

49

5.1 RESEARCH PROBLEM:

TO CHECK EFFECTIVENESS OF RETENTION STRATEGIES ADOPTED BY RELIANCE COMMUNICATIONS LIMITED.

5.2

OBJECTIVES OF THE STUDY:

To study the need for retaining new employees To know why employees leave organization To study retention strategies adopted by Reliance Communications Ltd. To make employees loyal towards organization To maintain stable workforce To examine the existing retention policy of winsome ltd. company. To recommend changes with a view to reduce turnover. To examine organization culture to make it more conductive for retaining people.

5.3 RESEARCH DESIGN

The research design is a master plan specifying the method and procedures for collecting and analyzing needed information. The research design in this project is exploratory in nature. A survey is conducted through a questionnaire on the employees of Reliance Communications ltd. Secondary data was also used in the study.

5.4 DATA COLLECTION

Two types of data were required for the purpose of a descriptive research-- Primary and Secondary. Both Primary and Secondary Data were collected for meeting the objectives of the research using the following methods:5.4.1 PRIMARY DATA : For the purpose of collection of primary data an unbiased, structured questionnaire was prepared which was administered to the respondents for the purpose of getting the information. Personal interviews of respondents were conducted. Telephonic survey and face to face contacts with the employees were used to know the retention strategies by asking them to fill up a questionnaire.

50

5.4.2 SECONDARY DATA: Secondary data provides a lot of information for understanding the factors underlying the study. Secondary data is also helpful in the formulation of hypotheses and testing the results of the research. The sources of secondary data comprised of journals, studies conducted in the past, concerned websites, etc. 5.5 SAMPLE DESIGN The population for the study was spread over a large geographical area and also due to time constraint, conducting a census survey was not possible. So a sample of respondents was selected from the whole population. This sample was supposed to represent the whole population in terms of characteristics relevant to the study. A Sample Design consisting of the following factors was prepared for the purpose of the study 5.5.1 POPULATION Employees in the RELIANCE COMMUNICATIONS LTD. were the target population for the study.

5.5.2 SAMPLING UNIT The sampling units for this study were employees who have been working in the company.

5.5.3 SAMPLE SIZE For the survey the sample constituted employees with different occupation. The sample size consist of 50 employees of RELIANCE COMMUNICATIONS LTD.

5.5.4 SAMPLING TECHNIQUES The sampling technique used in this case is convenience sampling. The employees of RELIANCE COMMUNICATIONS LTD. were included in the sample. All the respondents who were easily accessible and willing to share the information were administered the structured questionnaire to get the desirable information.

51

5.6 DATA COLLECTION METHOD The data used for the purpose was primary data. It was collected by formulating a questionnaire to answer in the form of direct interviews. For this purpose structured questionnaire was formed consisting of questions which are of multiple choices. Every care was taken to record the true opinion of the respondents. A sample of questionnaire has been attached in the appendix.

5.7 STATISTICAL TOOLS USED Statistical tools like mean score, percentage, average etc. were used in the study for the purpose of analysis of data. Charts, figures and graphs were also used to make the data more representable and easy to understand. 5.8 DATA ANALYSIS TECHNIQUE The data collected through survey questionnaire was analyzed with the help of percentage, mean, standard deviation, Factor analysis, Z- test. Tabular and graphic method which included pie charts and graphs were used to display data. Interpretations have been made on the data, drawing inferences.

52

LIMITATIONS OF THE STUDY

Although full efforts have been made to reach the conclusion, still because of following limitations, a more detailed research is required to reach to the effective conclusion. Respondents were not willing to answer all the questions. Respondents were biased while giving the information. They feel hesitation to give answers for the questions having like phone no., address etc. Some of the employees were not having time to provide information. Some of the employees were not interested in providing information due some fear in their mind.

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OBSERVATION AND ANALYSIS

1. Length of service in the present organization a) less than 1 year FIGURE 1 :
no. of respondents

b) 1-3years c) 3-5yrs

d) 5-7 years

e) more than 7 years

7 or more years 14% 5-7 years 16%

less than 1 year 10%

3-5 years 20%

1-3 years 40%

2) Reason for leaving the previous job: a) Less remuneration b) Slow growth avenues c) Lack of job security d) Work environment e) Problem with management FIGURE 2 :
no. of respondents

Work environment 6% Slow growth avenues 31%

Less remuneration 63%

Q : 4 TO 19 :-

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How much importance does organization give to following factors to retain employees Work environment Growth Advancement Job Security Monetary Benefits Non- monetary Benefits Recognition Working Hours Working Conditions Interesting Work Responsibility Training Opportunities Salary Hikes organisation setup Team Work Freedom to do job.

In market Research there are large numbers of variables, most of which are correlated and which must be reduced to manageable level. Factor analysis is a general name denoting a class of procedures primarily used for data reduction and summarization. Factor analysis is used to identify the factors that explained the correlation among a set of variables .To identify a new, smaller set of uncorrelated variables to replace the original set of correlated variables in subsequent multivariate analysis. This analysis process is based on a matrix of correlation between the variables. In this research the variables are correlated. Bartletts test of sphericity is used to test the null hypothesis that the variables are uncorrelated. The test for sphericity is based on a chi- square transformation of the determinant of correlation matrix. Another useful statistics is the Kaiser- Meyer-Olkin (KMO) measure of sampling adequacy.

55

TABLE 6.1 KMO and Bartlett's Test

Kaiser-Meyer-Olkin Adequacy. Bartlett's Sphericity Test Measure of Sampling .538 of Approx. Chi-Square Df Sig. 326.159 120 .000

In table 6.1 the null hyphpthesis is rejected by the Bartletts test of sphericity. The approximate chi-square is 326.159 with 120 degree of freedom. which significant at the 0.05 level.The value of KMO statistic .538 is >.5 Thus a factor analysis may be considered an appropriate technique for analyzing the correlation matrix.

TABLE 6.2 Communalities

Initial Workenvionment Growth Advancement Jobsecurity monetarybenefits nonmonetarybenefits Recognition Workinghours workingconditions interestingwork Responsibility trainingopportunities Salaryhikes organisationsetup Teamwork freedomtodojob 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Extraction .633 .833 .852 .643 .523 .693 .852 .570 .729 .799 .650 .663 .788 .768 .908 .875

Extraction Method: Principal Component Analysis.

Table 6.2 shows the application of principal component analysis. Under communalities initial column show that the communality for each variable v1 to v16 is 1.00 The eigenvalues for the factors are expected in decreasing order of magnitude as go from factor 1 to factor 16. Total eigenvalue for a factor indicate the total variance attributed to that factor. Communality: It is the amount of variance a variable shares with all the other variables being considered. This is also the proportion of variance explained by the common factors. Eigenvalue: The eigenvalue represents the total variance explained by each factor

56

TABLE 6.3 Total Variance Explained

Com pone nt

Initial Eigenvalues Total % of Variance 19.965 17.737 11.454 10.259 7.723 6.485 5.140 4.964 4.108 3.460 2.641 2.295 1.380 1.036 .902 .453 Cumulat % 19.965 37.701 49.155 59.414 67.137 73.621 78.761 83.726 87.834 91.294 93.935 96.229 97.609 98.645 99.547 100.000

Extraction Sums of Squared Loadings Total 3.194 2.838 1.833 1.641 1.236 1.038 % of Var 19.965 17.737 11.454 10.259 7.723 6.485 Cumulat % 19.965 37.701 49.155 59.414 67.137 73.621

Rotation Sums of Squared Loadings Total 3.089 1.962 1.892 1.826 1.541 1.470 % of Varia 19.309 12.265 11.822 11.411 9.629 9.186 Cumulative % 19.309 31.574 43.396 54.807 64.435 73.621

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

3.194 2.838 1.833 1.641 1.236 1.038 .822 .794 .657 .554 .422 .367 .221 .166 .144 .072

Extraction Method: Principal Component Analysis.

In the table 6.3 the total variance accounted for by all the factors is 16, which is equal to the number of variables. Factor 1 account for a variance of 3.194, which is 19.965 percent of the total variance. Likewise the second factor accounts for 17.737 percent of the total variance and the first 6 factors combined account for 73.621 percent of the total variance According to this only those factors with eigenvalues greater than 1.00 are retained, the other factors are not included in the model. An eigenvalue represents the amount of variance associated with the factor. Hence only factors with a variance greater than 1.0 are included. Factors with variance less than 1.0 are no better than a single variable. In table 3.3 we can see that the eigenvalue >1.0 result in 6 factors being extracted. This means that organization gives six factors most importance to retain its employees.

57

FIGURE 3

Scree Plot

Eigenvalue

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16

Component Number

A scree plot is a plot of the eigenvalue against the number of factors in order of extraction. The shape of the plot is used to determine the number of factors .Typically the plot has a distinct break between the steep slope of factors, with large eigenvalue and a gradual trailing off associated with the rest of the factors. Evidence indicates that the point at which the scree begins denotes the true number of factors. From the scree plot a distinct break occur at four factors. Finally from the cumulative percentage of variance accounted for , we can see that the first four factors account for 59.414 % of the variance, and the gain achieved in going to four factors is marginal. This situation indicates that these four factors are appropriate. Thus these four factors appear to be reasonable in this situation.

58

TABLE 6.4 Rotated Component Matrix(a)

Component 1 Workenvionment Growth Advancement Jobsecurity Monetarybenefits nonmonetarybenefits Recognition Workinghours workingconditions Interestingwork Responsibility trainingopportunities Salaryhikes organisationsetup Teamwork Freedomtodojob -.727 .894 .906 .753 -.488 -.019 -.071 .104 -.034 .106 -.235 -.172 .002 -.043 -.063 -.131 2 .196 -.032 -.039 .143 -.465 .808 .848 .070 -.019 -.476 .182 .081 -.015 -.170 .090 -.060 3 .093 .066 .124 -.048 .213 .086 -.268 .111 .054 .106 -.420 .043 -.873 .850 .183 -.116 4 .075 -.078 -.048 -.085 -.134 -.024 -.014 .070 .191 -.111 -.210 .032 .074 .102 .911 .917 5 .040 .149 .066 -.178 .050 -.164 .107 .242 .116 .644 -.585 .761 -.141 .051 .100 -.017 6 .225 -.024 -.083 .120 -.052 .067 -.210 -.692 .821 .352 .005 -.213 .005 -.039 .148 -.021

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a Rotation converged in 6 iterations.

This is an important output from factor analysis. This matrix contains the coefficients used to express the standardized variables in term of the factors. These coefficients represent the correlation between the factors and the variables. A coefficient with a large absolute value indicates that the factor and variables are closely related. Although unrotated factor matrix indicate the relationship between the factors and individual variables. For e.g. factor 1 is correlated with rest of the v1, v2, v3,v4,v5, v16. Likewise factor 2 is correlated with v6 and v7. Similarly factor 3 with v13 and v14 . And factor 4 is correlated with v14 and v15. Factor 5 is correlated with v10 ,v11 and v12. Factor 6 is correlated to v8 and v9 From this analysis we found that the significance difference between the factors is .00 which is less than .05. Thus the null hypothesis is accepted. It means there is relation between the factors. The factors are correlated.

59

Q: 20 TO 33 Rank factors that would help you to stay in the organization: Work Environment Growth Advancement Job Security Monetary Benefits Non- Monetary Benefits Recognition Working Hours Working Conditions Interesting Work Responsibility Training Opportunities Salary Hikes Organization Setup

TABLE 6.5 KMO and Bartlett's Test

Kaiser-Meyer-Olkin Adequacy. Bartlett's Sphericity Test Measure of Sampling .518 of Approx. Chi-Square Df Sig. 221.975 91 .000

In table 6.5 the null hypothesis is rejected by the Bartletts test of sphericity. The approximate chi-square is 221.975 with 91 degree of freedom, which significant at the 0.05 level. The value of KMO statistic .518 is greater than .5 Thus the factor analysis may be considered an appropriate technique for analyzing the correlation matrix.

60

TABLE 6.6 Communalities

Initial 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 1.000 Extraction .815 .683 .770 .839 .771 .859 .750 .795 .611 .807 .844 .801 .729 .680

growth jobsecurity monetarybenefits salaryhikes trainingopportunities advancement recognition nonmonetarybenefits workingconditions workinghours responsibilities interestingwork workenvironment organisationsetup

Extraction Method: Principal Component Analysis.

.Table

6.6 shows the application of principal component analysis. Under communalities

initial column show that the communality for each variable v1 to v14 is 1.00 The eigenvalues for the factors are expected in decreasing order of magnitude as go from factor 1 to factor 14. Total eigenvalue for a factor indicate the total variance attributed to that factor. Communality: It is the amount of variance a variable shares with all the other variables being considered. This is also the proportion of variance explained by the common factors. Eigenvalue: The eigenvalue represents the total variance explained by each factor.

61

TABLE 6.7 Total Variance Explained

Com pone nt 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Extraction Loadings Cum % 21.223 35.801 49.828 60.732 69.506 76.810 82.398 86.614 90.199 93.038 95.363 97.328 99.036 Total 2.971 2.041 1.964 1.527 1.228 1.022 Sums of Squared Rotation Sums of Squared Loadings Cum % 21.223 35.801 49.828 60.732 69.506 76.810 Total 2.231 2.027 1.861 1.793 1.640 1.201 % of Variance 15.938 14.479 13.293 12.805 11.714 8.582 Cumulative % 15.938 30.417 43.710 56.514 68.228 76.810

Initial Eigenvalues Total 2.971 2.041 1.964 1.527 1.228 1.022 .782 .590 .502 .398 .326 .275 .239 % of Var 21.223 14.578 14.027 10.904 8.774 7.303 5.589 4.215 3.585 2.840 2.325 1.965 1.708

% of Var 21.223 14.578 14.027 10.904 8.774 7.303

.135 .964 100.000 Extraction Method: Principal Component Analysis.

In the table 6.7, the total variance accounted for by all the factors is 14, which is equal to the number of variables. Factor 1 account for a variance of 2.971, which is 21.223 percent of the total variance. Likewise the second factor accounts for 2.041 or 14.578 percent of the total variance and the first 4 factors combined account for 60.732 percent of the total variance According to this only those factors with eigenvalues greater than 1.00 are retained, the other factors are not included in the model. An eigenvalue represents the amount of variance associated with the factor. Hence only factors with a variance greater than 1.0 are included. Factors with variance less than 1.0 are no better than a single variable. In table 6.7, we can see that the eigenvalue >1.0 result in 6 factors being extracted. This means employees give most importance to four factors that would help them to keep staying in the organisation.

62

FIGURE 4 :-

Scree Plot

3.0

2.5

2.0

Eigenvalue

1.5

1.0

0.5

0.0 1 2 3 4 5 6 7 8 9 10 11 12 13 14

Component Number

A scree plot is a plot of the eigenvalue against the number of factors in order of extraction. The shape of the plot is used to determine the number of factors .Typically the plot has a distinct break between the steep slope of factors, with large eigenvalue and a gradual trailing off associated with the rest of the factors. Evidence indicates that the point at which the scree begins denotes the true number of factors. From the scree plot a distinct break occur at four factors. Finally from the cumulative percentage of variance accounted for , we can see that the first four factors account for 60.732% of the variance, and the gain achieved in going to four factors is marginal. This situation indicates that these four factors are appropriate. Thus these four factors appear to be reasonable in this situation.

63

TABLE 6.8 Rotated Component Matrix(a)

Rotated Component Matrix(a) Component 1 Growth Jobsecurity monetarybenefits Salaryhikes trainingopportunities advancement Recognition nonmonetarybenefits workingconditions workinghours responsibilities interestingwork workenvironment organisationsetup .872 .698 .244 .064 -.128 .908 .040 .083 .161 .119 -.141 -.104 .014 .028 2 -.053 -.080 -.758 .135 .154 .058 .705 .865 -.089 .030 -.007 -.067 .240 .287 3 -.133 -.027 -.044 -.318 .750 -.093 .114 .061 -.134 -.144 .893 -.043 .553 .080 4 -.007 .097 -.311 .185 -.129 -.108 -.460 .095 -.714 .871 -.005 .058 .327 .158 5 .103 -.174 -.074 -.819 .347 -.028 -.165 .155 .060 .002 .162 .144 -.390 .740 6 .152 -.387 .180 -.100 -.177 -.098 .026 .051 -.212 -.114 .017 .872 .326 .134

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a Rotation converged in 7 iterations.

This is an important output from factor analysis. This matrix contains the coefficients used to express the standardized variables in term of the factors. These coefficients represent the correlation between the factors and the variables. A coefficient with a large absolute value indicates that the factor and variables are closely related. Although unrotated factor matrix indicate the relationship between the factors and individual variables. For e.g. Factor 1 is correlated with rest of the v1, v2 and v6 Factor 2 is correlated with v3, v7 and v8 Factor 3 is correlated to v5, v11 and v13 Factor 4 is correlated to v9 and v10 .Factor 5 is correlated to v4 and v14. Factor 6 is correlated to v12 From this analysis we found that the significance difference between the factors is .00 which is less tan .05, thus the null hypothesis is accepted. It means there is relation between the factors. The factors are correlated.

64

ANALYSIS OF FACTORS ON WHICH COMPANY PAYS IMPORTANCE 1) WORK ENVIRONMENT Ho : 3.34 = 4 { __ __ Xs = Xp }

Hi

: 3.34 =/= 4

__ __ { Xs and Xp are not equal }

TABLE 6.9 :X 1 2 3 4 5 f 5 6 10 25 4 f = 50 __ Xs = fx / f = 167/50 = 3.34 = { 619 / 50 - (167/50) 2 }1/2 = { 12.38 - 11.15 }1/2 = { 1.23 }1/2 = 1.109 Standard Error (S.E.) = standard deviation/ (n)1/2 = 1.109 / (50) 1/2 = 1.109 / 7.07 = 0.15 fx 5 12 30 100 20 fx = 167 5 24 90 400 100 fx2= 619 fx2

Standard Deviation = { fx2 / f - (fx/f) 2 }1/2

Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = | 3.34 4 | / 0.15 4.4 > 1.96 = .66 / 0.15 = 4.4

Hence calculated value Zc > Zt ; INTERPRETATION:

65

H1 is accepted. Therefore employees believe that company is not paying more importance to work environment to retain its employees.

2) GROWTH Ho : 2.54 = 3 Hi : 2.54 =/= 3

TABLE 6.10 :X 1 2 3 4 5 f 7 20 15 5 3 f = 50 __ Xs = fx / f = 127/50 = fx 7 40 45 20 15 fx = 127 2.54 fx2 7 80 135 80 75 fx2= 377

Standard Deviation = { fx2 / f - (fx/f) 2 }1/2 = { 377 / 50 - ( 127 / 50) 2 }1/2 = { 7.54 - 6.45 }1/2 = { 1.09 }1/2 = 1.04 Standard Error (S.E.) = standard deviation/ (n)1/2 = 1.04 / (50) 1/2 = 1.04 / 7.07 = 0.14 Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = | 2.54 3 | / 0.15 = .46 / 0.15 = 3.06

Hence calculated value Zc > Zt ; INTERPRETATION:

66

H1 is accepted. Therefore the employees believe that company is not paying average importance to growth opportunities.

3) ADVANCEMENT Ho : 2.46 = 3 Hi : 2.46 =/= 3

TABLE 6.11 :X 1 2 3 4 5 f 12 17 10 8 3 f = 50 __ Xs = fx / f = 123 / 50 = fx 12 34 30 32 15 fx = 123 2.46 fx2 12 68 90 128 75 fx2= 373

Standard Deviation

= { fx2 / f - ( fx / f ) 2 }1/2 = { 373 / 50 - ( 123 / 50) 2 }1/2 = { 7.46 - 6.05 }1/2 = { 1.41 }1/2 = 1.18

Standard Error (S.E.) = standard deviation/ (n)1/2 = 1.18 / (50) 1/2 = 1.18 / 7.07 = 0.166

Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = | 2.46 3 | / 0.166 = .54 / 0.166 = 3.25

Hence calculated value Zc > Zt ; INTERPRETATION: H1 is accepted. So, company is paying less importance to advancement. 67

4) JOB SECURITY Ho : 2.26 = 2 Hi : 2.26=/= 2

TABLE 6.12 :X 1 2 3 4 5 f 14 19 9 6 2 f = 50 __ Xs = fx / f = 113 / 50 = fx 14 38 27 24 10 fx = 113 2.26 fx2 14 76 81 96 50 fx2= 317

Standard Deviation = { 6.34 - 5.10 }1/2 = { 1.24 }1/2 = 1.11 Standard Error (S.E.) = standard deviation/ (n)1/2 = 1.11 / 7.07 = 0.15 Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = | 2.26 2 | / 0.15 = .26 / 0.15 = 1.73

Hence calculated value Zc < Zt ; INTERPRETATION: Ho is accepted. Therefore the company pays less importance to job security to retain employees.

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FACTORS WHICH ARE REGARDED AS IMPORTANT BY EMPLOYEES TO HELP THEM STAY WITH THE ORGANIZATION 5) GROWTH Ho : 3.94 = 4 Hi : 3.94 =/= 4

TABLE 6.13 :X 1 2 3 4 5 f 1 6 8 15 20 f = 50 __ Xs = fx / f = 3.94 = { 16.74 - 15.52 }1/2 = 1.10 Standard Error (S.E.) = standard deviation/ (n)1/2 = 1.10 / 7.07 = 0.15 Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = | 3.94 4 | / 0.15 = 0.06 / 0.15 = 0.4 fx 1 12 24 60 100 fx = 197 fx2 1 24 72 240 500 fx2= 837

Standard Deviation

Hence calculated value Zc < Zt ; INTERPRETATION: Ho is accepted. Therefore the employees give more importance to growth opportunities.

69

6) JOB SECURITY Ho : Hi : 4.22 = 4 4.22 =/= 4

TABLE 6.14 :X 1 2 3 4 5 f 0 4 6 15 25 f = 50 __ Xs = fx / f = 4.22 = { 18.7 - 17.8 }1/2 = 0.94 Standard Error (S.E.) = 0.94 / 7.07 Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = |4.22 4 | / 0.13 = 1.6 = 0.13 fx 0 8 18 60 125 fx = 211 fx2 0 16 54 240 625 fx2= 935

Standard Deviation

Hence calculated value Zc < Zt ; INTERPRETATION: Ho is accepted. Therefore the employees pay more importance to job security.

70

7) MONETARY BENEFITS Ho : 4.12 = 4 Hi : 4.12 =/= 4

TABLE 6.15 :X 1 2 3 4 5 f 1 4 5 18 22 f = 50 __ Xs = fx / f = 4.12 = { 18 - 16.9 }1/2 = 1.04 Standard Error (S.E.) = Appling Z- test, Zc = __ __ | Xs Xp | / S.E. = | 4.12 4 | / 0.14 = 0.85 1.04 / 7.07 = 0.14 fx 1 8 15 72 110 fx = 206 fx2 1 16 45 288 550 fx2= 900

Standard Deviation

Hence calculated value Zc < Zt ; INTERPRETATION: Ho is accepted. So employees give more importance to monetary benefits.

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8) SALARY HIKES Ho : 4.26 = 4 Hi : 4.26 =/= 4

TABLE 6.16 :X 1 2 3 4 5 f 0 4 3 19 24 f = 50 fx 0 8 9 76 120 fx = 213 fx2 0 16 27 304 600 fx2= 947

__ Xs =

fx / f

= 4.26 = { 18.94 - 18.14 }1/2 = 0.89

Standard Deviation

Standard Error (S.E.) = Appling Z- test, Zc = __ __ | Xs Xp | / S.E.

0.89 / 7.07

= 0.12

| 4.26 4 | / 0.12

0.26 / 0.12

= 2.16

Hence calculated value Zc > Zt ; INTERPRETATION: H1 is accepted. Therefore the employees dont give more importance to salary hikes.

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CONCLUSION
Less remuneration is main cause for most of the present employees working in the organization for leaving their previous jobs. So from this result we can say that company should pay proper remuneration to its employees so as to retain them otherwise some other organization may attract them by paying more remuneration. Work environment, Growth, Advancement, Job Security, Monetary Benefits and Non-

monetary Benefits are important factors from among the many factors that the company uses to retain its employees. But employees give more importance to growth, job security, monetary benefits, salary hikes, training opportunities and advancement. So we can say that there is variation in what company provides to employees to retain them and what actually the employees require to help themselves to stay with the organization. Further, employees believe that company pays average importance to work environment to retain its employees and less importance to growth opportunities, advancement, and job security. In contrast, employees give more importance to growth opportunities, job security and monetary benefits and pay most importance to salary hikes.

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SUGGESTIONS
Company in order to retain its employees stresses on Work environment, Growth,

Advancement, Job Security, and Non- monetary Benefits where as the employees give more importance to growth, job security, monetary benefits, salary hikes, training opportunities and advancement. So there is variation in what company provides to its employees in order to retain them and what employees want. Therefore, the company in order to retain the best talent should align its retention strategies to the employees requirements. It should provide monetary benefits, salary hikes, job security and training opportunities to its employees. Employees believe that company is paying less importance to growth opportunities, advancement, and job security. Whereas, the employees give importance to growth, job security and advancement. So the company should pay more attention to growth opportunities, job security and advancement in order to reduce turnover. Besides this the company should provide monetary benefits and salary hikes

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QUESTIONNAIRE
I am the management student of Sri Sukhmani Institute of Engineering & Technology, Dera Bassi conducting research. Kindly fill in your response in fair manner. Individual response would be held in strict confidence.

1) For how long have you been serving in the present organization? a) less than 1 year b) 1-3years c) 3-5yrs d) 5-7 years e) more than 7 years 2) Have you served any other organization before? Yes / No. If yes than how many years 3) State the reason for leaving the previous job: f) Less remuneration g) Slow growth avenues h) Lack of job security i) Work environment j) Problem with management k) Any other Please specify------------------------------How much importance does the organization give to following factors to retain employees in the organization. very high importance-5 very low importance-1

FACTORS 4 5 6 7 8 9 Work environment Growth Advancement Job security Monetary benefits Non monetary benefits

10 Recognition 11 Working hours 12 Work conditions 13 Interesting work

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14 Responsibility 15 Training opportunities 16 Salary hikes 17 Type of work 18 Organization setup 19 Team work 20 Freedom to do job Any other please specify: Rank the following factors that would help you to stay in the organization FACTORS 21 22 23 24 25 26 27 28 29 30 31 32 Work environment Growth opportunities Advancement Job security Monetary benefits Non monetary benefits Recognition Working hours Work conditions Interesting work Responsibility Training opportunities 1 2 3 4 5

ss33 Salary hikes 34 35 Type of work Organization setup Any other please specify.. and rank

Name: Designation: Phone no.

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BIBLIOGRAPHY: Attracting and Keeping The Best and the Brightest: Survey Results From Council for Excellence in Government Principals on How to Get, Develop and Retain Excellent People in Government Service," Council for Excellence in Government, 2002 Development, And Work Motivation," Ruth Kanfer, Phillip L. Ackerman, Academy Of Management Review, 2004. Staying Ahead of the Curve 2004: Employer Best Practices for Mature Workers," Study Conducted for AARP by Mercer Human Resource Consulting, September 2004 Employee Retention: Overview: Employee Retention Series Part I," Nancy R. Lockwood, SPHR, GPHR, Society for Human Resource Management, July 2005. Taking Action against the Quiet Crisis in Recruitment and Retention," AFT Public Employees, AFL-CIO. 2005

WEBSITES http://www.citehr.com/cms_articles.php http://www.peopleatwork.com.au/rec_articles.asp www.hr-guide.com www.hr.com http://humanresources.about.com www.managementparadise.com

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