CHAPTER-3

RESEARCH METHODOLOGY
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.

In it we study the various steps that are generally adopted by a researcher in studying his
research problem along with the logic behind them.

3.1 Rationale of the study

With the advent of liberalization, globalization there is change in Indian business scenario.
Revenue generation raising standards of living, creating employment avenues, an eternal
inventory of opportunities showing a trend which is no less than the resurgence for Indian
market and one of the major reasons for this is shining IT sector of India, accounting for
approximately 52 per cent of the US$ 124-130 billion market. The culture of advanced career
opportunities provided by IT industry in India has created multiple job opportunities. Rapid
growth in Indian IT industry with new innovations and new market increased the demand and
competition for skilled and talented employees. In Foreign origin and Indian origin
multinational IT companies in India where level of competition are continuously increasing
in terms of products , technologies and processes, to match with the pace of change People
are the key resources to keep company ahead by creating advantage through creativity and
innovation ,customer relationship ,improving processes , technology and products . That is
why it is becoming difficult to hold on to those employees. Career oriented, highly ambitious,
educated, young workers are bringing new values and expectations to the workplace and
making organisations efforts for employee retention more difficult.

Due to change in govt. and its market policies the job market has a paradigm shift. In past it
used to be sluggish, currently it is booming with jobs offerings. Its highest impact can be seen
in the Indian IT industry. The growing demand for talent pool has increased the competition
among employers for skilled and talented employees and raised the question who stays with
you. This attrition proves very expensive for the organisations not only in terms of
recruitment and training cost but churn in the workforce leads to lower productivity as well as
lack of customer satisfaction, loss of organisation knowledge and intellectual asset.
.The cost associated with turnover may include lost customers business and

damaged morale. In addition there is the hard cost of time spent in screening

verifying credential, references, interviewing hiring and training the new

employee, just to get back to where you started (Hale, 1998).The solution

comes with the employee retention practices.

Present study is modest effort in the direction and the researcher delineates the

statement of research problem more clearly as under

Determinants and Strategies of Employee Retention in IT Industry in India

3.2 Objectives of the Study

The major objective of this research is to study the Determinants and Strategies

of Employee Retention in IT companies in India. To achieve this broader

objective, the following sub-objectives have been identified:

To find out the determinants of employee retention in IT companies in India.

To compare the determinants of employee retention in Indian and foreign

Origin multinational IT companies in India.

To identify the strategies of employee retention in IT companies in India.

To compare the strategies of employee retention in Indian and Foreign Origin

multinational IT companies in India.

To examine the effectiveness of the strategies of employee retention in IT

companies in India.

To explore the Indian Wisdom on HRM with special reference to the cause of

employee turnover and the retention strategies as spelt out in Indian

scriptures.
To suggest the innovative strategies of employee retention on the basis of findings and
conclusions to Indian and Foreign Origin multinational IT companies in India.

3.3 Research Design

The research design provides the conceptual structure with in which research has to be
conducted. It constitutes the blue print for collection, tabulation, and analysis of the data.
Thus keeping in view the objectives and data available for the study a descriptive-cum-
exploratory research design had been taken up. A mix of these design provided the enough
provision against biasness, maximizes reliability and opportunity to consider various aspect
of the research problem.

The main idea of the research has been framed around the factors organization health, exit
barriers, job satisfaction, combined with monetary and non monetary benefits shown in
fig.3.1. The study also explored the Indian wisdom on HRM with special reference to the
cause of employee turnover and retention strategies with reference to Bhartiya Wisdom.

Figure 3.1: Linkage of Organizational Health, Job Satisfaction, Exit Barriers and
Bhartiya

Wisdom with Employee Retention [Source: Developed by Researcher]

The research design used in the study further described below:-

Sample and Sample Profile

Instrument for Data Collection

Statistical Hypotheses

Tabulation and Codification Of data

Statistical Analysis

3.3.1 Sample and Sample Profile

To select the sample judgmental sampling technique had been followed.

Judgemental sampling is a non probability sampling technique where the researcher selects
the samples that are relevant to the researchers focus.

Judgemental sampling is used where researcher targets a particular group of people whose
background expertise relates to the objective of the study. In the present study the judgmental
sampling technique has been used by the researcher because the study was confined to the IT
professionals as they had the information relevant for the objective of the study. The
companies explored for survey comprised Indian origin and foreign based multinational IT
companies in India given as follows:

Foreign Origin Multinational IT companies in India - Adobe, Alvarion, Arcient,

Blackrock, Capegemini, Cognizant,CSE, Dell, Damco Solutions, Ericcsson,

Honeywell, HTS, IBM, Mckinsey, Nokia Siemens, Oracle, Smartchip, Orange,

Samsung, Xerox, Stryker, Bosch, Vodafone,Novell Software, Mercer, Infocentric,

IGate, Fidelity,Fiserv, Hawelett Packard, Kelton.

Indian Origin Multinational IT companies in India: Infosys, Birla soft, HCL,

HUL, Satyam Computers, TCS, Mahindra Satyam, SSDMC, Tata

Communications, Wipro, HTSL, ICS, Idea Cellular, NDC Ltd., NEC HCL, and Net Solution.
The distribution of sample on the basis of demographic variable has been given in table 3.1.
Sample of 700 respondents (classified on basis of gender, age, income level, years of
experience,) had been targeted in the research work. But due to constraints of time and
restrictions on information sharing in some of the

IT companies the sample of respondents was 500.

The sample size should be as large as possible and representative of the targeted population to
minimize the sampling error.
 CHAPTER-5
CONCLUSION AND RECOMMENDATIONS
This chapter represents the discussion of the results described in the previous chapters. The
objectives and key conclusions have been shown in table 5.1.

OBJECTIVES FINDINGS

To find out the determinants of
employee retention in IT
companies in India.
The six determinants were identified named as
Organisation
Culture, Monetary Reward Practices, Organisation
Initiation,

Learning And Growth, Organisation Health and

Exit Barriers. The

determinant with the top of the list to affect

employee retention in

IT companies in India was learning and growth

followed by

Organisation Health and Organisation Culture on

second and third

place. The respondents preference for Organisation

Initiation

ranked 4th followed by Monetary Reward

Practices and Exit

Barriers on 5th and 6th place.

To compare the determinants of
employee retention in Indian and
foreign Origin multinational IT
It has been found that the determinants identified
for employee
retention affects more in Indian origin as compared
to foreign
companies in India. origin multinational IT companies in India.

To identify the strategies of The seven strategies have been identified for
employee retention
employee retention in IT
named as Career Development Strategies,
companies in India.
Compensation

Strategies, Additional Compensation Strategies,

Training and

Development Strategies, Child Care Strategies,

Work Life

Balance Strategies and Quality of Work Life.

To compare the strategies of There is no significant difference found in

compensation
employee retention in Indian and
strategies, additional compensation strategies,
Foreign Origin multinational IT
Training and
companies in India.
Development strategies, child care strategies and
quality of work

life strategies of employee retention in foreign

origin and Indian

origin multinational IT companies in India. The

career

development strategies and work life balance

strategies of

employee retention has been found significant

different in foreign

origin and Indian origin multinational IT

companies in India. The

career development strategies and Work life

 Balance strategies

has been considered more important by the

employees of foreign

origin as compared to the Indian origin

multinational IT companies

in India

To examine the effectiveness of More than half of the respondents considered

Career
the strategies of employee
Development, Compensation, Additional
retention in IT companies in
Compensation, Training
India.
and Development, Child Care, Work Life Balance
and Quality of

Work Life strategies for employee retention in IT

companies in

India totally effective or somewhat effective.

Quality of work life

was on the top of the strategies considered

effective by the

respondents followed by childcare strategies and

career

development strategies for employee retention.

Training &

development, compensation strategies, additional

compensation

strategies got rank 4th, 5th and 6th. Work life

balance strategies

scored the least and were ranked 7th.

To explore the Indian Wisdom
on HRM with special reference
to the cause of employee
turnover and the retention
strategies as spelt out in Indian
The study also explored the relevance of Indian
wisdom on HRM
with special reference to the cause of employee
turnover and the
retention strategies as spelt out in Bhartiya
scriptures and thereby

scriptures. researcher has conceptualized Bhartiya Model of

Employee

Retention (BMER).

To suggest the innovative The researcher has suggested various employee

retention
strategies of employee retention
strategies through Bhartiya Wisdom spelt out in
on the basis of findings and
Bhartiya
conclusions to Indian and
scriptures from various dimensions like
Foreign Origin multinational IT organisational harmony,

companies in India. compensation, reward, appreciation, work

environment,

leadership behavior, motivation, communication,

and employee

relations. Other strategies explored were career

progression, skill

enhancement, training and development like

assistance and

funding for higher education, top talent

management, Internal

opportunities, promotion, succession planning,

salary hike, job
rotation, onsite opportunities, health and safety like
employee

medical insurance covered by company, long

service recognition

consist of loyalty bonus or retention bonus,

innovative reward and

recognition plans like best performer awards,

employee of the

month, star award, best idea award to encourage

learning and

innovations, sport award to encourage health and

fitness, flexible

work arrangements, , workplace diversity like

celebrations on

festival days, cultural activities , family connect

programmes

,referral bonus, yearly performance bonus, bonus

on completion

of project, , car and home loan interest part paid by

companies,

flexible work arrangements for work life balance.

 CHAPTER 6
RECOMMENDATIONS AND
CONCLUSION
This study identified the determinants and strategies of employee retention in IT industry in
India. The specific purpose of the research in IT industry was (1) to find out the determinants
of employee retention in IT companies in India. (2) to compare the determinants of employee
retention in Indian and foreign Origin multinational IT companies in India.(3) to identify the
strategies of employee retention in IT companies in India.(4) to compare the strategies of
employee retention in Indian and

Foreign Origin multinational IT companies in India.(5) to examine the effectiveness of the

strategies of employee retention in IT companies in India.(6) to explore the Bhartiya Wisdom
on HRM with special reference to the cause of employee turnover and the retention strategies
as spelt out in Indian scriptures.(7) to suggest the innovative strategies of employee retention
on the basis of findings and conclusions to Indian and Foreign Origin multinational IT
companies in India.

A total of six objectives were developed. Two main hypotheses and thirteen sub hypothesis
were developed and tested in the study.

To collect primary data the tool used in the research was structured questionnaire .As well as
while administering the questionnaire process interviews of some project leaders, team
leaders, project managers and IT engineers were also conducted. The judgemental sampling
was followed. The sample included in the study was drawn from all over India mainly from
IT cities-Bengaluru, Pune, Hyderabad, Kolkata, Chennai, Delhi, Gurgaon, Noida, Chandigarh
etc. A total of 500 IT professionals from Indian Origin and Foreign Origin multinational IT
companies have been considered to collect data.

The findings of the study indicated that the respondents considered Organisation Culture,
Monetary Reward Practices, Organisation Initiation, Learning and Growth, Organisation
Health and Exit Barriers the determinants of employee retention. The study by Janani, 2014;
Kaur, 2013; Yiu and Saner, 2008; Harris and Brannick, 1999 has also described the
importance of these factors as determinants of employee retention. The study compared the
determinants of employee retention in Indian origin and foreign origin multinational IT
companies in India. The study investigated that there is a significant difference between
determinants of employee retention. The significant difference has been found between
organisation culture, monetary reward practices, organisation initiation, organisation health
and exit barriers while there was no significant difference has been found between learning
and growth determinant of employee retention in Indian origin and foreign origin
multinational IT companies in India. Study by Zachariah & Roopa, (2012) supports the
findings. This difference in determinants of employee retention in Indian origin and foreign
origin multinational IT companies in India is due to the difference in of western and Indian
Psyches. Indian philosophy has a dynamic approach to work. It does not at all encourage
inactivity, with another worldly, resigned or fatalistic perspective. It considers work as duty:
- The Bhagwad Gita, the divine song, is one of the authoritative sources of Bhartiya
philosophy. It makes two important points. Your control is on your own action, not on the
result, which is affected by many other factors. Do not be tempted for inaction, for work is
the very basis of existence, of being alive.

As western approach consider that job is a contract and the boss subordinate relationship is
official, personal and professional lives are separate while in Indian context personalized
relationship is more important than a contractual relationship, and prefer natural leaders from
their group or community, to official ones means Indian psyche is to look leader as father
figure or role model. It implies that Indian management consider more the consideration
perspective of their employees and promotion or hierarchical superiority does not necessarily
imply acceptance as a leader integrity of character is very important. Western approach
encourages more direct and confrontational individual initiative while Indian philosophy
emphasizes seniority and family- ties, remain sensitive to subordinates self image.

The strategies identified were career development strategies, compensation strategies,

additional compensation strategies, training and development strategies, child care strategies,
quality of work life strategies and work life balance. The quality of work life strategies was
ranked first by the respondents followed by child care strategies. Career development
strategies got rank 3rd on scale totally effective and somewhat effective while training &
development, compensation and additional compensation was ranked 4th 5th and 6th. Work
life balance scored least ranked 7th supported by the studies (Kaliprasad, 2006; Singer&
Goodrich, 2006; Harder, 2007; Morgan& Jay, 2011; Hoonaker, et.al, 2003) The study
compared the strategies of employee retention in Indian origin and foreign origin
multinational IT companies in India. The study investigated that there is no significant
difference between strategies of employee retention in Indian origin and foreign origin
multinational IT companies in India. The difference does not found because of the basis of
Indian philosophy which consider the philosophy of Vasudhev Kutumbkam (world is
family),loksangraha (human welfare), Confluence, Oneness ,holistic development ,Devine
work culture and collective intersests which are more or less similar to the training and
development , welfare strategies, quality of work life. The multi response analysis has also
been done to know in depth organisation effort to increase retention of employees, efforts to
increase retention of employee, what factors generally prompt an employee to seek an
alternative employment and employees reasons to quit an organisation.

5.1 Recommendations to Retain Employees in IT Companies in India

The following recommendations are suggested on the basis of the present research study:

1. To retain employees in IT companies in India, companies should develop culture of open

communication the companies must have free two way communication throughout the
organisation, the organisation must be free from any kind of discrimination, harassment .
Organisation should nurture a culture of value and work ethics. Organisation should provide
right resources for performance and bose should understand. There should be cordial relation
among superior, colleagues, and peers as well. Autonomy to take job related decisions, strong
corporate governance and citizenship, commitment to learning, technical interviews,
employee referrals and value compatibility in an organisation can help to retain employees in
IT industry in India.

2. Organisation Initiation towards employee needs also enhance employee retention.

Companies should develop and practice team work and should provide effective
organisational support system for the accomplishment of assigned task to retain employees.
There should be an effective implementation of succession planning and a clearly defined
retirement policy. The companies should consider individual initiation to retain employees in
IT companies in India.

3. Employee retention cannot be possible without monetary reward practices.

Companies should have provision of pay packages as well as performance based pay system
to retain employees. There should be a competitive salary structure and fair frequency of
amount of bonuses. Organisation can use gain sharing with employees of greater than
expected gains in profits and public citation for accomplishment liberal conveyance
allowance, Employee stock option plans and overtime payments, bonus to retain employees
in IT companies in India.

4. Companies should have quick socialization process and help employees to settle their
families. It has been found that most of the employees leave their company with in the first
two years. So a proper induction or orientation programme may help them to socialize
quickly and helps in employee retention. By conveying organizational vision, culture, values
and business ventures to the employees helps them to align their objective with organisation.
It is also necessary to communicate what is expected to them in terms of goals, roles and
responsibilities so that they may feel their self as the part of the organisation.

5. The IT companies should have good ambience and quality of work life.

6. For work life balance, work from home, alternative work schedule, leave bank in which
employee can accumulate leave for fixed number of days and can use them as per
requirement, flexi timing, opportunity to pick overtime hours and shorter Friday on voluntary
basis i.e. an employee can work for extra hour from monday to thursday and may leave early
on friday, these strategies can be helpful to improve balance between work and life of
employees and will help in employee retention.

7. There should be a facility for child care like crche facility, parental care home, for who
have old age parents, paternal leave and maternity leave to retain employees.

8. For retaining talent career development of employees should be considered by the

organisation through fast track career path, performance based growth, quarterly promotion
cycles, salary increment, and global opportunities.

9. Performance based culture, interesting job content, lesser hierarchy or flatter organisation
structure ease the communication and coordination and lesser conflicts helps to retain
employees in IT companies in India.

10. Companies should provide training and development opportunities to their employees. On
the job training and development, diverse experience during job, early responsibility in career
can be helpful to retain employees. Cross domain experience i.e. opportunity should be
provide to the employees to work in different projects, domain, functions, geographies and
different technologies. Organisation should provide opportunities to the employees to explore
his or her best fit area to work. It will raise expertisation in talent pool as well as increase job
satisfaction and employee retention.