Why Employees Leave Organizations?

This article was written by Azim Premji, CEO, Wipro Technologies 

Every company normally faces one common problem of high employee turnout ratio. People are leaving the company for better pay, better profile or simply for just one reason’ pak gaya ‘. This article might just throw some light on the matter….

Early this year, Arun, an old friend who is a senior software designer, got an offer from a prestigious international firm to work in its India operations developing specialized software. He was thrilled by the offer. He had heard a lot about the CEO of this company, charismatic man often quoted in the business press for his visionary attitude.

The salary was great. The company had all the right systems in place employee-friendly human resources (HR) policies, a spanking new office, and the very best technology, even a canteen that served superb food. Twice Arun was sent abroad for training. “My learning curve is the sharpest it’s ever been,” he said soon after he joined. “It’s a real high working with such cutting edge technology.” Last week, less than eight months after he joined, Arun walked out of the job.  He has no other offer in hand but he said he couldn’t take it anymore. Nor, apparently, could several other people in his department who have also quit recently. The CEO is distressed about the high employee turnover. He’s distressed about the money he’s spent in training them. He’s distressed because he can’t figure out what happened. Why did this talented employee leave despite a top salary? Arun quit for the same reason that drives many good people away.

The answer lies in one of the largest studies undertaken by the Gallup Organization. The study surveyed over a million employees and 80,000 managers and was published in a book called First Break All The Rules. It came up with this surprising finding:

If you’re losing good people, look to their immediate supervisor. More than any other single reason, he is the reason people stay and thrive in an organization. And he’s the reason why they quit, taking their knowledge, experience and contacts with them. Often, straight to the competition.

 “People leave managers not companies,” write the authors Marcus Buckingham and Curt Coffman. “So much money has been thrown at  the challenge of  keeping good people – in the form of better pay, better  perks and better training – when, in the end, turnover is mostly  manager issue.” If you have a turnover problem, look first to your managers. Are they driving people away?

Beyond a point, an employee’s primary need has less to do with money, and more to do with how he’s treated and how valued he feels. Much of this depends directly on the immediate manager. And yet, bad bosses seem to happen to good people everywhere. A Fortune magazine survey some years ago found that nearly 75 per cent of employees have suffered at the hands of difficult superiors. You can leave one job to find – you guessed it, another wolf in a pin-stripe suit in the next one. Of all the workplace stressors, a bad boss is possibly the worst, directly impacting the emotional health and productivity of employees.

HR experts say that of all the abuses, employees find public humiliation the most intolerable. The first time, an employee may not leave, but a thought has been planted. The second time the thought gets strengthened.  The third time, he starts looking for another job.  When people cannot retort openly in anger, they do so by passive aggression. By digging their heels in and slowing down. By doing only what they are told to do and no more. By omitting to give the boss crucial information. Dev says: “If you work for a jerk, you basically want to get him into trouble.  You don’t have your heart and soul in the job.”

Different managers can stress out employees in different ways – by being too controlling, too suspicious, too pushy, too critical, but they forget that workers are not fixed assets, they are free agents. When this goes on too long, an employee will quit – often over seemingly trivial issue.

It isn’t the 100th blow that knocks a good man down. It’s the 99 that went before. And while it’s true that people leave jobs for all kinds of reasons- for better opportunities or for circumstantial reasons, many who leave would have stayed – had it not been for one man constantly telling them, as Arun’s boss did: “You are dispensable. I can find dozens like you.” While it seems like there are plenty of other fish especially in today’s waters, consider for a moment the cost of losing a talented employee. There’s the cost of finding a replacement. The cost of training the replacement. The cost of not having someone to do the job in the meantime. The loss of clients and contacts the person had with the industry. The loss of morale in co-workers. The loss of trade secrets this person may now share with others.  Plus, of course, the loss of the company’s reputation. Every person who leaves a corporation then becomes its ambassador, for better or for worse.

We all know of large IT companies that people would love to join and large television companies few want to go near. In both cases, former employees have left to tell their tales.

“Any company trying to compete must figure out a way to engage the mind of every employee,” Jack Welch of GE once said.   Much of a company’s value lies “between the ears of its employees”.  If it’s bleeding talent, it’s bleeding value.

Unfortunately, many senior executives busy traveling the world, signing new deals and developing a vision for the company, have little idea of what may be going on at home. That deep within an organization that otherwise does all the right things, one man could be driving its best people away.

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36 Responses to “Why Employees Leave Organizations?”

  1. This article is very true and this is what is the root cause of employee attrition in any organisation.
    After a certain point in carrer, more than money what really matters is how are you being treated.If the immediate manager does not treat you with dignity then attrition is bound to happen.
    I think this article should be an eye opener to all the senior executives of the organisations.
    Unfortunately, many top notch organisations like GENPACT believe that cost of replacement is less than the cost of training a new joinee.By this way, they drain out or loose the experienced & trained staff.But its high time that GENPACT shouls release that they have lost a considerable amount of talented employees and its the quality of the work that is hampered.
    360 degree appraisals should be introduced in all the organisations so that every employee is able to rate or appraise their managers ans vice versa.

    • Sudhir Edathara Says:

      I Totally agree with Premji that people leave company due to bad manager

      also other reasons why people leave oraganisation are:-

      1. some leaveIf you dont have good colleagues or companion in your team to keep the team going and to boost morale of the whole team.
      2. for some people money and position is not priority they are just there to spread goodness and help company to grow a LOt with there attitudethey get frustated when additional responsibility is added to them when he was not at working for postion and money.
      3. some leave job when they get with autonomus work they been doing for past many years and they become mature and capable to handle some other role even which present company cant figure out…

      thanks………………….

      3.

  2. Sreyashi – I completely second the introduction of 360 degree appraisals. Thanks for your comments.

  3. This is 200% true. But how many senior executives have time to read this?

    I quit my previous two orgaizations for the same reason.

  4. I feel this is apt, I am facing an issue with my manager so I observe that my productivity got down as I am not pushing my self into the issues to resolve them.

    I left my old company just I didn’t had good boss. Now after 3 years in the current company I’m feeling the same.

  5. I would strongly second this amazing finding by Mr. Premji. Having worked under both types or bosses, i know how important it is to work under/with a “good” boss. The worst thing any boss can do to you is discrimination.

  6. This is very much applicable in today’s IT world and any other field.The immediate supervisors should understand their sub-ordinates and nature their talents.There should be give and take kind of relationship between managers and the sub-ordinates.

  7. Agree that the reason is quite right. And now that Mr. Premji has realized this as the main problem, he will make sure that a sincere 360 appraisal is conducted in Wipro to retain the talent.

  8. I can second to Sreyashi. I left genpact because of crap management.. they have terrible things happenings right under their nose.. and I can bet folks.. it will explode and fumes will tarnish all the bad faces.
    But the worst part, everybody knows especially in GESS where no introduction is required for the dictatorships of SB, AB, and more over SVP is putting deaf ears to all the concerns. It is not that I hate GENPACT, its a nice place to work, but what about idiots u r working under.

  9. This is the same even in offshore development centers also..The 99% you give is gone. Tarnishes you for the remaining 1% decoration.As it is stated the seed sprouts and grows into a tree that will drive out the 99% efficient employee.
    Cycle starts again . People come and go but the superior will not ……Stays there and grows like a parasite .
    Another point to be added to the article. Another point that drives people out is the superior giving importance to the obsequious people who are of lesser talent that the employee .

    • I agree… Also let me tell you that there are superiors wwho show that they care for your well being and what they really want is for you to fail. Additional responsibilities are put without the higher management being aware of it and during the appraisals, there no mention of it…Why because its not on paper. My manager told me that he wants me to take responsibility of work that he was to do. If it fails I bear it, if its a success he takes away the credit. PARASITE!!
      Most of time in office is spent listening to his complaints about the higher management, rest of the time goes in doing the work he delegates..which actually he is suppose to be doing and end of the day…no appreciation.
      And worst of all he favors team members who actually spend their time gossiping.

  10. bad pressing from the board of directors
    no program for improvement

  11. I agree with this…. especially in regards to my current job. The company is good though processes are little slow and I was getting used to its culture. But thanks to my immediate supervisor…. Im not planning to quit my job.

  12. Just a number Says:

    I agree 100%. I just walked away from a great paying job with outstanding benefits, simply because my direct manager too often devalued me. I feel sorry for the company and what lies ahead with this individual in the position he is in. I imagine, much more turnover.

  13. Genpact employees problems are many , I had innumerable problems with the manager and had to quit

  14. Hi all,

    Being in the recruitments industry i have enjoyed reading this article a lot!! However it is suprising how so many, so called “professionally managed” company are victim of the same cause- Bad Superiors!! It may not be your Immediate boss – but a boss above your boss, who likes to buttin every ducking time. I used to hate the way my AVP used to work in my previous organization:- Sit on the chair all day and do nothing apart from complaining about targets. He had no people management skills at all…3 good people left ,before i did… I had no offers in my hand as well …he drove me to a friggin point where i said ” I’m Not going take s@#$ from him anymore”.

    Good luck and Enjoy!!

  15. AWESOME article.. I have been in the same organization for more than 5 years ..The pay package is not that great but I like the culture~ the people around..and whenever I have thought of quitting it has been because of my immediate boss/ colleagues ..

  16. I agree 100% with this article. I have worked in my Desktop Support job now for 11 years. My job was outsourced for 3 years five years ago, during which I worked for the outsourcing company and never left my desk. We were brought back 2 years ago because it was a disaster and I lost all my years of service. They have now promoted two people to our Network Services group from non-technical positions outside of our group. In one case, they had nothing else the girl could do and they liked her, so they put her in a Network Administrator role and trained her to do specific tasks. She still has NO technical certifications (after 5 years). The second person was given a Network Administrator position last year and had been a telephone installer. He was given this position by our Telecom Director (who also manages Network Services and has made no secret of the fact that we were forced on him) because of personal bias. Since these positions come up rarely, I asked why none of us (5 people) in desktop Support were considered or even given a chance to apply for this position and was basically told that it was his decision and none of my business. I suggested that this was our only career path in IT and we hadn’t been given a chance in either of the last two openings. I then asked how we might increase our chance of promotion in IT and he told me that we should get the training required for the job, and if there’s not an opening here, we should look outside the company. He actually suggested we leave the company if we’re not happy! I was floored. I am already heavily Microsoft and hardware certified and neither of these people had or have any tech certs. I am the Team Lead for our Desktop group and am steadily the highest performer in quantity and satisfaction survey scores. He never stands up for us and clearly couldn’t care less if we’re happy in our career. He’s been here for 30 years, works about 5 hours a day, and delegates everything. When I suggested to him that it was inappropriate that our CEO was having us fix her kid’s gaming PC and that our facilities manager was working at her house fixing plumbing and electrical problems on company time, he told me that “she owns the company and can do whatever she wants” (we are owned by an investment company and she has zero ownership). Unfortunately, he’s not the only manager here like that and the result is that morale is very low and many people have either left or are just doing the bare minimum and waiting to be released so they can collect severance and unemployment benefits. That may now happen sooner than people think, as they just announced that we’ve signed a contract with GENPACT to provide outsourcing services. Our CEO is a former GE exec, so no surprise there. Good luck all.

  17. Sudhir Taneja Says:

    This is not actually depends on your Manager. What about the stupids who sits UP on the Manager. Many times they do worst thing but never be in picture.

    But I am very Happy for my Manager and team who did exactly what they think for me. Thanks to all my Seniors. I am enjoying my Job and not planning to quit early.

  18. Preserving a long time job is now become very hard due to less increment, despair, frustration, not being well treated by managers or Seniors (in some cases,who has not well aware of to keep good relations with employees).

    If continuously gets desperate, better way leave the job by smooth exit & enter into the new world.

  19. The dead wood leaves, but the talented replace their boss.

  20. Kewldude Says:

    Well, the article was a good read, the responses were better. Dunno why everyone is after GENPACT bashing though.

    The first mover always tries to push thru his advantage and gain at the expense of others. From my experience i shall say that the manager is possibly trying to avoid future competition by throwing in spanner in your work. Two ways in which you can avoid it, become a subject matter expert and become less dispensable. Secondly network far and wide, if you are alone you are vulnerable, if you play as a group your manager shall be equally wary touching you fearing your group’s wrath. Good Luck Folks!!!

  21. Genpact is the worst company when it comes to Human relations. I worked for five years and still had no respect. Just do a stupid MBA from anywhere and go become a team Leader in this company

  22. Hi! I was surfing and found your blog post… nice! I love your blog. :) Cheers! Sandra. R.

  23. The strongest statement made in the articles was “People Leave the manager, not the company” which indeed very true. Through my working experience, people like to work with the less perfection type of boss. The boss that understand the weakness of human being. If the boss seem to be perfect, he shall face lots of staff-boss relationship problem.

  24. Yes, Very true, i am the victim of this, in my previous company, my boss was good when i joined him but when he realiszed that i am good enough that the sr. management has started recoznizing me, he was scared, and become the worst boss, and afetr some time i quitted from my job, that was the only option left…..

    And that day i understood the meaning of people leave there managers not the company………..

    But i learnt a lesson also, dont love your manager or company, just do your job, u never know when your boss turn out to be a monster for you

  25. Chandra Lal Tiwari Says:

    This is 200% true, employees an organization because of bad managers.To be a good managers you need to applause your teammate for cohesiveness. Good employees are asset for any organisation but unfortunately so called mangers do not understand this fact.When a manager thinks that he is the driving force for the success , he commits the biggest mistake.

    We need reallign ourv thought process in this area.

  26. Razaul Hassan Says:

    I strongly believe in Premji’s article. I hated my immediate manager who was too biased and cunning. Never appreciated my efforts in streamlining the process. Its very hard to find a manager who can motivate you and whom you can idolized.

    I wonder why nobody pointed out inbreeding and nepotism. Currently I am facing a manager who has low skill-sets and got the job due to approach.

    Good to see usage of the word ‘jerk’ for all those managers who are first factor for attrition.

  27. Razaul Hassan Says:

    I strongly believe in Premji’s article. I hated my immediate manager who was too biased and cunning. Never appreciated my efforts in streamlining the process. Its very hard to find a manager who can motivate you and whom you can idolized.

    I wonder why nobody pointed out inbreeding and nepotism. Currently I am facing a manager who has low skill-sets and got the job due to approach.

    Good to see usage of the word ‘jerk’ for all those managers who are first factor for attrition.

  28. If Premji has so much knowledge about attrition, why does Wirpo attrition level is so high. Better said than done. In this competitive world, Manager/ Supervisor are so much tied up with other activities that they don`t get much time to spend with their team member

  29. nice article….

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  32. I Totally agree with Premji that people leave company due to bad manager

    also other reasons why people leave organization are:-

    1. some leave If you don’t have good colleagues or companion in your team to keep the team going and to boost morale of the whole team.
    2. for some people money and position is not priority they are just there to spread goodness and help company to grow a Lot with there attitude they get frustrate when additional responsibility is added to them when he was not at working for position and money.
    3. some leave job when they get with autonomous work they been doing for past many years and they become mature and capable to handle some other role even which present company cant figure out…

    thanks………………….

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