Why people leave companies?

Expect this post to be long and very long. People are the most important part of your organization. An entrepreneur can test the company’s success by measuring the cumulative experience and creative talent available in the company. First year (for fresher it can be 2 to 3 years) with the company is learning phase where you add industrial knowledge and existing competition into your thought process. It will take time to understand the customer need, the company architecture, the technology used, the products available and the overall USP of the company. It is always good to build on the existing strength and new people need to understand the existing strength and add it to their thought dimensions. In short people are the key. At the end of every 6 months an entrepreneur should perform this test and if there is no significant improvement with Human Resource then the processes needs to be changed urgently. THIS SHOULD BE GIVEN THE HIGHEST PRIORITY. Also entrepreneurs (companies) need to set targets for building people. Sales will happen if people are there. Company will innovate if creative people stay. Jack Welch of GE once said, “A company’s value lies between the ears of its employees”.

Every company goes through this problem of losing good and bad people. Bad people leaving the company is good but in my opinion a person who had worked for more than 1 year with you can’t be bad. If they were bad why were they tolerated for one year they should have been fired earlier. Good people can lose the motivation down the line and noone but company (the people responsible) should take the blame. There can be various reasons but certainly it is not easy to find and solve but here are some of thoughts from respected company creators (I got these articles through mail group and have no proof about the author of the article). I will put my thoughts in next post as a continuation of this post.

Some reasons why people leave companies

  1. Immediate boss is the reason people stay and thrive in an organization. And he ‘s the reason why people leave. says Aziz Premji
  2. For greener grass says Dr. Gopalkrishnan, Chairman TATA Sons.
  3. Unhappiness in a workplace says Dr. Gopalkrishnan, Chairman TATA Sons.

Azim Premji about people leaving companies
Azim Premji, Wipro

Every company faces the problem of people leaving the company for better pay or profile. Early this year, Arun, 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. 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.

Last week, less than eight months after he joined, Arun walked out of the job. Why did this talented employee leave ? 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 boss. Immediate boss is the reason people stay and thrive in an organization. And he ‘s the reason why people leave. When people leave they take knowledge, experience and contacts with them, straight to the competition. “People leave managers not companies,” write the authors Marcus Buckingham and Curt Coffman. Mostly manager drives people away?

HR experts say that of all the abuses, employees find humiliation the most intolerable. The first time, an employee may not leave, but a thought has been planted. The second time, that thought gets strengthened. The third time, he looks 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 a trivial issue.

Talented men leave. Dead wood doesn’t.

I will not putting my thoughts now but after putting another excerpt by Dr.Gopalkrishnan,Chairman TataSons. According to him people leave for a greener field or due to job dissatisfaction.

People leaving companies by Dr Gopalkrishnan

Mr.Gopalakrishnan succeeds Mr.Ratan Tata as Chairman of Tata Sons Ltd., the holding company for many of the Tata Bluechips like Tata Steel, Tata Motors,Tata Power, Tata Chemicals, Voltas, etc., Possibly he is the first non-Tata person to head the Tata Empire. The below article is really interesting !

The grass isn’t always greener on the other side !!

Move from one job to another, but only for the right reasons. It’s yet another day at office. As I logged on to the marketing and advertising sites for the latest updates, as usual, I found the headlines dominated by ‘who’s moving from one company to another after a short stint’, and I wondered, why are so many people leaving one job for another? Is it passe now to work with just one company for a sufficiently long period?

Whenever I ask this question to people who leave a company, the answers I get are: “Oh, I am getting a 200% hike in salary”; “Well, I am jumping three levels in my designation”; “Well, they are going to send me abroad in six months”.

Then, I look around at all the people who are considered successful today and who have reached the top – be it a media agency, an advertising agency or a company. I find that most of these people are the ones who have stuck to the company, ground their heels and worked their way to the top. And, as I look around for people who changed their jobs constantly, I find they have stagnated at some level, in obscurity!

In this absolutely ruthless, dynamic and competitive environment, there are still no short-cuts to success or to making money. The only thing that continues to pay, as earlier, is loyalty and hard work. Yes, it pays!

Sometimes, immediately, sometimes after a lot of time. But, it does pay.

Does this mean that one should stick to an organisation and wait for that golden moment? Of course not. After a long stint, there always comes a time for moving in most organisations, but it is important to move for the right reasons, rather than superficial ones, like money, designation or an overseas trip.

Remember, no company recruits for charity.

More often than not, when you are offered an unseemly hike in salary or designation that is disproportionate to what that company offers it current employees, there is always an unseen bait attached.

The result? You will, in the long-term, have reached exactly the same levels or maybe lower levels than what you would have in your current company.

A lot of people leave an organisation because they are “unhappy”. What is this so-called-unhappiness? I have been working for donkey’s years and there has never been a day when I am not unhappy about something in my work environment-boss, rude colleague, fussy clients etc.

Unhappiness in a workplace, to a large extent, is transient.

If you look hard enough, there is always something to be unhappy about. But, more importantly, do I come to work to be “happy” in the truest sense? If I think hard, the answer is “No”.

Happiness is something you find with family, friends, may be a close circle of colleagues who have become friends.

What you come to work for is to earn, build a reputation, satisfy your ambitions, be appreciated for your work ethics, face challenges and get the job done.

So, the next time you are tempted to move, ask yourself why are you moving and what are you moving into?

Some questions are:

  • Am I ready and capable of handling the new responsibility? If yes, what could be the possible reasons my current company has not offered me the same responsibility?
  • Who are the people who currently handle this responsibility in the current and new company? Am I as good as the best among them?
  • As the new job offer has a different profile, why have I not given the current company the option to offer me this profile?
  • Why is the new company offering me the job? Do they want me for my skills, or is there an ulterior motive?

An honest answer to these will eventually decide where you go in your career- to the top of the pile in the long term (at the cost of short-term blips) or to become another average employee who gets lost with time in the wilderness?

“DESERVE BEFORE YOU DESIRE” – Dr. Gopalkrishnan, Chairman TATA Sons.

These were some thoughts by some experienced gurus who have experienced the wind. I have an appointment with Mr Teeth Doc (my Dentist) and I will continue once I am back (expect next post). Do put your thoughts that why do you think people leave companies?

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16 Replies to “Why people leave companies?”

  1. My comment is going to be long I guess…

    Why people shift to a new home? Because the present one is small, bad neighborhood, desire to live in a posh area, a convenient location. Even a married man can buy a new home to stay away from his in-laws!! So there could be several reasons – major and minor.

    There might be several reasons for leaving a company too. I set my priorities this way:
    1. Job satisfaction (includes how good my boss is)
    2. Prospect
    3. Money

    I can even compromise with salary if I like the work and I like to work with my boss. However, objectives change with time and money also matters when it comes to personal life.

    As per the above articles, the first one is good and second one is biased. It says the risks of job hopping only. It’s not job hopping, but any unplanned decision can create problems as well! If changing a job is that bad, then why Om Malik is such a successful person today? I completely agree with the line: “Talented men leave. Dead wood doesn’t.”

  2. I personally feel money does not matter till a time. I being in that phase of my life only want to learn new things gain knowledge. And job hopping is not at all bad if done smartly. Money should not be the only reason for job change.

    I also feel that the article by Azim Premji is much more practical then the second one.

    Mr Gopalakrishnan says “Deserve Before you Desire”. But what if one doesn’t get the desired when he deserves that? I guess then he is left with no option but to search for another job 🙂

  3. Talented men leave. Dead wood doesn’t. –Why do they need to ?

    We do agree that money is not the only constraint to judge the higher attrition rate, these days !
    There are a few more to add to it as rightly mentioned in these articles. But how do we bring these managers to justice!
    Simply offering them a couple of pointer articles won’t be of any good as they don’t mind showcasing them for good. The infamous greed to gain corporate power tempts all managers to hold back worthy people to come up and question their acts in the long run!

    It holds good with a former US president’s views about India and Pakistan, that in these countries you need to pull down others to make way for yourself. And you need to do it by hook or by crook!

    So, the medicine to curb this hankering disease has not yet been discovered…

  4. Disclaimer: There is nothing to disclaim about it.

    Thanx for this post, and what a timing coz I’m about to leave my current JOB, and I can share lots of personal inputs.. for Why ppl leave company or I’m leaving my company.

    1) Money- Naaah…yes it do matter nahin to ghar kaise chalega in other terms “kisi ko bhi paisa nahin kata hai” (everybody loves money) , but at the dawn of your career I just go only by money I look for the future prospects like at the time of recruitment this company was offering lowest salary as possible in our campus placement but I chose this b’coz of Brand name and and the responsibilities, learning and kind of market exposure they promised me during the interview and their presentation, but after six months I’m feeling lost and cheated by the company b’coz the kind of work they offer suits 12th pass clerical JOB. with no time for learning only they keep us busy on work that not at all add value to your MBA in marketing degree. so I’m not leaving this company for money.

    2) Job satisfaction (includes how good my boss is) – I give 10/10 to Job satisfaction if I would be satisfy with my job I would have dedicate my whole life to this company, but currently I just wanna tell that there is no such thing as Job satisfaction in this company everybody wants to leave this company b’coz they are not satisfy with the kind of work they are doin.

    3) Boss Factor – Job satisfaction and kind of Boss is inter linked, coz if your boss is understanding and knows how to get work done by you with happy ending and if he knows how to groom a new comer manager then you’ll be very happy with him, –
    – but if don’t remember your name and you have to remind him 100 times that sir I’m Rajesh Rana not him
    – if he knows what is the exact reason of your failure instead of blaming even his failure upon you,
    – if he knows you constraints properly and accordingly keep his expectations,
    -Instead of keeping eye at his and your work he delegate his whole work upon you and at the end of the month wants the results and if even any single thing goes wrong he blames that “Tum logo ne mujhe Barbad kar Diya…” then it’s unfair.

    4) Work Environment – this includes your Boss, your colleagues, subordinates, other parallel departments and your clients – Work environment is another factor I’m leaving this job, I want to work in a professional company where work is done on a professional way not like my company where you have beg others to do their own job in proper manner, (what the hell) life become hell in such a company where other employees don’t do their work properly. It’s like a Government office type environment here.

    5) I use to wonder why most of the Indian companies are not there at world’s TOP 100 companies – this is just because what I’ve just mentioned and lack of team work , coordination and enthusiasm to give best output among employees specially at manufacturing unit,

    6) At the end…… I should feel at the end of the day that I had contributed to my company, done a great job, should get feeling of satisfaction for today’s work and excitement & enthusiasm and eagerness for tomorrow’s day at my company, I don’t know whether I could be able to find such company in India which offer great future with great satisfaction and Boss……… I can write a book but I think I should stop here coz I gotta make new resume to apply for new JOB.

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  6. Well……thanks a lot for that….i have read up on some management strategies and have come across these points…wish my dumbass of a manager would have the brains to read this….

  7. Ever wondered if each and every person sticks his heels into the ground, how the hell is each person going to reach the “top” simultaneously??!!! Its the basic funda of the pyramid, the base is going to be broad, and it’ll reduce as you go up.

    What Dr.Gopalkrishnan might apply to a small %age, but not to the entire lot; for the majority, the best option is to leave, and take up whatever oppurtunities they get. Being stagnant is not the best possibility, certainly not for everybody. (although it makes a hell of a difference for the person on the top, like Dr. Gopalkrishnan, hence his “advice”)

  8. Ever heard of top guys lecturing from the ivory tower? Well, what led them to the ivory tower is a different question altogether (perhaps sheer hard work, for which i respect the top folks – perhaps through family name and sucking up, perhaps through just sheer market demand and environmental leeways – e.g check all those technical managers in your indian software companies, who have risen quite a number of undue levels just due to Y2K projects!)

    AHP’s article is well placed – placing the onus on the supervisors – ask the supervisors, they will place the onus on “organizational directive”/”budget”/”promotional directives” from the top guy to allow only a small percentage up the line to maintain the pyramid, or to restrict salary increments based on how much operating margin the organization has in mind.
    Dr Gopalakrishnan’s ideas, very much like F.C Kohli’s, are heavily ivory-tower centric. Though personally both of them are people made of plain clay in their professional lives, with no showbiz, etc – i just wish the managers working under them shared the same value systems. The “unhapiness” that Dr Gopalakrishnan so pointedly questions is considering the fact that more than 60% of the time of an Indian employee is spent in office – so yes, they DESERVE to be treated well and therefore DESIRE.
    Stop lecturing at HR forums/international industry-forums, Sir – We will respect you more if you actually implement, rather than “advice”.

  9. Hi Aji,

    This is really a great combination.

    For the first article, I have nothing to say. It is really a great one. However, the last line is a bit worrying :-?. Does one need to leave a company to prove his or her salt ~x( ! Talented men leave because there had never been an optimized use of their talent. And as the use is not proper, so the pay package is likely to be poor. There is another saying “Right People are never in Right place” – Obliquely this has got the same indication.

    Why the company cannot identify the potentials! I would say – guess the potentials to stay in the business.

    As far as pay package is concerned, I will just toss an Idea. Do you know what you are paid? Do you have a clear idea of what you can do with your one month’s salary (if you do, you had not been working for the last month.)! Isn’t there any difference between getting paid in cash, cheque, or direct money transfer!

    The next article by Dr.Gopalkrishnan is just a trash.

    The first proposition was “Move from one job to another, but only for the right reasons” – however, throughout the write-up, only the wrong reasons were mentioned. To add, these Wrong Reasons seemed to me too weak to point to the Right Reasons.

    Another comment haunted me a lot “What you come to work for is to earn, build a reputation, satisfy your ambitions, be appreciated for your work ethics, face challenges and get the job done.”

    This is The Reason for which you come to work – the “state”, when you are “in” is different. We have different ambitions, but won’t you want to be happy in a place where you spend more than 50-60% of your time along with another 20% in preparation and travel.

    “If you’re losing good people, look to their immediate boss.” – I will not work under Gopalkrishnan for anything – I am sure about that if he is sure about his ideas.

  10. I agree with both of their viewpoints, Aziz Premji and GopalKrishnan. They both share the same story from different perspectives. The reason for their difference is that Aziz Premji was already a CEO managing the company while Gopalkrishnan had to make his way up on the corporate ladder. Aziz premji’s view is something like an observer outside the room who doesn’t know exactly what is going in employee’s mind. He is only concerned with the what could have caused this and how he should analyze by breaking down the components associated with it. So, the manager’s role in employee’s success at the company has become a very crucial component because of its direct relationship. While, on the other hand looking at Gopalkrishnan’s statement talks about the mindset which employee should have while he/she is working in the organization. He talks about the actual scenario because he has faced them all firsthand. He talks from the perspective of the person who is inside the room rather than just cause-and-effect relationship between boss and the employee.

    If we are looking for the career/skill building in the same company, then we could follow Gopalkrshnan’s advice else if we want to be at mercy of company’s manager for success then we could go for Premji’s advice. Finally, it depends on us who we are and what are individual personalities are.

  11. Good things breed good work.Basically,all people like good things.To an employee,a company is good if it breeds good things for its employees.For increasing production and productivity of a company,negative punishment will never breed good result for the company.If a company like TCS forces 500 employees to leave the job on the pretext of performance,what more could be thought from the company.The real reasons might be to reduce expenditre to cover up the incompetancy of the HR management.TCS has created black spot on it by removing its own staff on a trivial issue.Positive actions will motivate the morale of the staff to better effectiveness.It is a fact that if employees are motivated they can do wonders not only for the employer but for themselves also.Companies in Japan hves developed rapidly due to their positive thinking,not taking action like TCS.,IBM,WIPRO.These companies should learn positive thinking and employee freindly techniques.Mahatma Gandhi became famous not by showing negative thinking.So,it is my earnest request to I.T.Companies to adopt and nurture good HR techniques for employees.
    Sushama Nayak

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