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New Hire Costs

1. The cost of bring the new person on board including the cost to put the person on the payroll, establish computer and security passwords and identification cards, telephone hookups, cost of establishing email accounts, or leasing other equipment such as cell phones, automobiles.
2. The cost of a manager's time spent developing trust and building confidence in the new employee's work.

Recruitment and Retention Strategies

Considering the phenomenal costs of attrition, we suggest that the firms should have comprehensive recruitment and retention strategies. Some such strategies are listed below:

1. The companies should look at smaller cities and people above the age of 30 as potential recruits. They have been shown to be more loyal to companies.
2. The companies should formulate exhaustive and complex career development paths so that the employees have enough opportunity for growth within the organization
3. Profit sharing/ incentive plan: A profit sharing plan that links the return to the length of the employment can create a big financial incentive for employees to retain their job.

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* Contributed by -
Ankur Pawa & Nishant Choudhary,
Indian Institute of Management,
Lucknow.