'Need to control attrition rates in ITeS industry'

With countries like China and Philippines becoming attractive destinations for outsourcing services, India faces a challenge in remaining a cost-effective option in the ITeS industry, according to Malcolm Wagget, chief operating officer for HSBC Global Resourcing in South Asia.

This, Wagget added, can be done by reducing the attrition rates in the industry as attrition is an expensive part of a company's balance sheet.

At the national conference organised by Executive Recruiters Association on 'Optimising cost per hire "� a partnership approach', Wagget said that there is a need to control attrition rates in the ITeS industry as it has reached the 50 per cent mark. "Besides, the cost of attrition is significant at 1.5 times the annual salary," he added.

According to Wagget, there is more attrition at the low-end ITeS services rather than the high-end ones like equity research, analytics and insurance services.

"Therefore, we need to meet these challenges by not just focussing on paychecks but also by ensuring bonding programmes, flexible working hours and a strong career path. This is because, no matter how much you pay in this industry, there will always be someone who pays more than you," he added.

"This industry also faces other challenges like the ones related to infrastructure, wage inflation and dwindling pricing, data security and protection and quality of recruits," Wagget said, adding that only six out of 100 aspirants that the industry receives are eventually recruited.

He, therefore, suggested that recruitment consultants also need to partner with the companies in formulating long-term retention strategies.