This document discusses how to control staff attrition in a shared services environment. It begins by noting that attrition is an important issue due to the transactional nature of work and risk of knowledge loss. It then provides tips for controlling attrition, including identifying core operational needs, being aware of external market conditions, offering career options, implementing an onboarding framework, and retaining employees within the wider business. The key is balancing acceptable turnover levels while minimizing disruption through standardization and knowledge capture.

1. HOW DO YOU CONTROL STAFF ATTRITION
IN A SHARED SERVICES ENVIRONMENT?
A tip to get you there…keeping a lid on attrition
The recruitment, development and retention of employees are core competencies in Shared Services and Business Process Outsourcing; but employees do
move on, sometimes to other organizations (external attrition), but often also
internally, as open positions within other functions attract them. This internal
attrition is just as important as external attrition. So, given the transactional
nature of much of the work, and given the risk of knowledge loss when staff
leave, how do you control attrition?
Staff turnover is a common, unavoidable, daily challenge. Though it carries costs with it if the turnover rate is too high, attrition can also be healthy as a means of refreshing a team, getting new ideas,
and providing trained and experienced staff for deployment elsewhere within a company. The
challenge, however, is to control it.
Within Shared Services, attrition is largely driven by the profile of recruits (graduates, multi-lingual,
young, mobile, career-oriented), the nature of the work (transactional), lack of career progression,
competition from other SSCs in the area, an unengaging work culture, and last but not least, insufficient leadership.
© Chazey Partners 2013
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2. Productivity / Service Levels
EMPLOYEE LIFECYCLE
Service Levels
Employee
Leaves
Productivity
Employee Starts
Time
Managing the impact of staff turnover on service is a critical aspect of running effective business
services. The crucial determinant of this impact is the level of standardization. SSOs with highly
standardized processes can support staff interoperability and movement; meaning, higher levels of
standardization can withstand higher levels of turnover. In contrast, the impact is amplified in environments with low process standardization, where high turnover leads to constant service disruption
- as vital, specific experience and knowledge are lost, the learning curve has to be constantly repeated.
A further risk of low standardization is that loss of employees creates additional work for the remaining team. When coupled with complaints about service deterioration, this creates stress levels, which
can lead to further resignations. A viscous circle ensues …
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Your Goal : sustainable attrition
Not all turnover is bad, of course. Many shared services leaders will speak of a 10%
attrition rate as highly “acceptable”, even “desirable” to avoid operations getting stale.
Beyond that, though, things get tricky. So what’s a sustainable turnover level? Where low standardization exists, a rate between 10%-15% is manageable. Where high standardization exists, rates can rise
to 15%-25%. In highly rules-based environments (e.g. some call center operations), the rate can be
even higher without negatively impacting service delivery.
2 | Chazey’s Toolkit – Keeping A Lid On Attrition – October 2013

3. 5 STEPS TO CONTROLLING
ATTRITION
If you want to gain control over staff turnover, here are a few tips: first, you need to identify your core needs; second,
you need to be aware of external market conditions that impact your employees’ desire to stay put; third, you should
be doing all you can to make a career in your team a popular choice; fourth, put in place a structured framework for
onboarding, that supports positive engagement; and fifth, if all else fails … offer employees a position within the
wider business. Let’s look at these one by one.
1
Identify and align/define core operational needs
The first step is to focus on core operational needs and align these with role profiles.
Start with a simple matrix of role requirements and relevant skills and experience as
depicted below.
Profile / Skill
Domain
Experience
Customer
Facing
Language
Fluency
Transactional Processing
LOW
LOW
LOW
Exception Handling
HIGH
MED
MED
Customer Interaction
MED
HIGH
HIGH
Continuous Improvement
HIGH
LOW
LOW
Technical
HIGH
MED
LOW
Know what you are up against
2
Make sure you are aware of the external labor market conditions and any competitive
businesses in your area, especially as new ones move in, or as existing centers expand.
Pay attention to what impacts employment.
3
What career options are you offering?
Find out what employees find attractive about your
work environment – employee surveys are useful. Run focus
groups to find out what works well and what doesn’t. Leverage
that feedback. Also, track your employment metrics: How long
does a typical employee stay with you? Is that an acceptable
timeframe? Work around it. And track why staff leave. The
exit interview is an invaluable source of information, too
often neglected. Find out what you can control. Money
is not always the reason staff leave.
3 | Chazey’s Toolkit – Keeping A Lid On Attrition – October 2013

4. “Exit interviews are an invaluable
source of information, too often
neglected”
4
Build a framework to manage attrition
You can counter high attrition by helping incoming staff find their feet faster, and
encouraging engagement; engaged staff are less likely to leave. Make sure you
have a robust induction process that facilitates an employee being productive
from the start. Offer staff opportunities to develop their skills through courses,
whether internally or externally.
Many companies actively promote external learning, and offer promotions upon
completion. And don’t overlook the “soft skills”: while functional expertise is important,
it’s the management and negotiation skills that will get results. Make career training
compulsory, and don’t overlook mentoring and “buddy” systems.
On the other hand, you can protect yourself against “loss of knowledge” by taking a
structured approach to job-rotation, thus building up backup expertise. And you can
capture knowledge that is specific to customers or processes through Apps like Yammer,
which collect know-how in a central, easy to access and update, repository.
5
If you can’t stop them, at least keep them
for the wider business
If someone really does want to move on, offer them a career within the wider organization,
where their collective knowhow will benefit the business. Open a dialogue with
employees to understand their requirements and plans, and actively collaborate with
HR to position the shared services center as a global talent pool.
“Actively collaborate with HR to position
the shared services center as a global
talent pool”
4 | Chazey’s Toolkit – Keeping A Lid On Attrition – October 2013

5. EXAMPLE
Accounts Payable is often a typical entry-level job in an SSO/BPO –
and usually carries a high turnover risk.
Get the upper hand over attrition by following these steps:
• Each team should be managed by a Team Lead with a minimum of 2 years’ experience – must
have technical and leadership capability
• Team should maintain a minimum standard of aggregate number of years’ experience – don’t
allow this to be diluted by leavers or joiners
• Team members must complete a minimum period within the team (12 months) before rotating
elsewhere
• Arrange the team around Clusters where the team leads sit within the team
• Document all processes / capture local knowledge in templates and keep them up to date
• Make sure new recruits receive intensive induction
• Introduce structured on-the-job work shadowing with buddy / mentor – use a ‘scoring’ system to
define readiness
• Offer structured training and development – a minimum of 60 hours per annum
• Implement a structured introduction to team members and others who staff will interact with
• Track and display team and individual productivity and quality KPIs, for motivation and accountability
5 | Chazey’s Toolkit – Keeping A Lid On Attrition – October 2013

6. For more articles on Chazey’s Toolkit, please visitwww.ChazeyPartners.com/Resources
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6 | Chazey’s Toolkit – Keeping A Lid On Attrition – October 2013