La Cole, an employee engagement platform, utilises artificial intelligence, machine learning, and modeling techniques to predict employee attrition rates. #HR #HRTech

1. Why do employees leave and what to do about it?
At any point in time, about 25% of employees are considering or having thoughts about quitting,
as per Mercer's 2018 Employee Engagement Index report. Even big companies like Infosys and
Wipro constantly work to bring their attrition rates to single digit numbers, going to show the
importance placed on this HR parameter. In some cases, hiring managers’ appraisals are linked
to their ability to maintain low attrition rates.
Here, it becomes crucial that companies keep employees motivated and engaged because this,
in turn, will help them flourish. The repercussion of not taking corrective steps could be high
employee attrition which could in turn cause monetary and non-monetary losses to the
company.
According to various reports and statistics available on the internet, employee attrition ranges
from 3% to 25% across various sectors and countries. A 2017 survey report by Ann Bares
pointed out that total employee turnover in 2016 across industries was close to 18% and this
number has been on the rise since 2013.
Investing in predicting attrition
The adverse effects of attrition on a company are numerous - reduced motivation, low morale,
low customer service, replacement costs, etc. Wouldn’t it then make sense for companies to
make a tiny investment here? An investment in reducing attrition would not only save money but
also retain their best employees.
While models do exist in the market, they only predict likely attrition using a diagnostic approach
and have low to moderate accuracy. Sometimes, the HR department uses judgement
techniques such as asking managers to keep a check on people’s lives.
When we did our research, we found this space lacked the clarity it required. This gave birth to
our employee engagement platform - La Cole, a platform that utilised artificial intelligence,
machine learning, and modeling techniques to predict employee attrition rates.
High accuracy prediction
We went a step further to enable managers to take the situation in their hands in retaining
potential attrition cases. In study cases, La Cole had a 91% accuracy rate in predicting
employee attrition and since it is a self-learning algorithm, the accuracy will only improve with
time.
To do this, the platform took into consideration several variables within the company such as
environment variables (facilities, profitability of company etc.), financial variables (salary and
CTC), external variables (distance between office and home), work-related variables (date of
last promotion, average working hours), legal variables (scheduled working hours) and
individual variables (marital status, etc.). These helped us in statistically analysing the
relationship between variables to know -
A: Which employee is likely to leave the organisation.
B: When will the employee leave the organisation.
C: Why will that employee leave the organisation.

2. Conversely, the same model helps recruiting managers predict which prospective employee will
fit the company’s culture and stay for longer periods, proving beneficial to both companies and
consultants.
HR analytics on the rise
The global recruitment industry is worth $504 billion, out of which the backfill market size is
conservatively estimated to be around $200 billion. However, the HR analytics market size is
expected to grow to around $860 million by 2020.
The company’s attrition rate speaks volumes about its working and intricacies. A high number
could indicate poor performance of the company or an unhealthy team/work environment. You
might unwittingly be spending time and money on recruitment-related tasks or overtime given by
employees and management in place of this person. Exit interviews are a clear indicator that
companies want to understand why someone decided to leave.
A platform like La Cole has the potential to change these numbers in the market. When
employees are engaged and happy they tend to stick around for longer. By figuring out the
reasons that make employees quit and how long does they ponder the idea before acting,
companies can take preventive measures and drastically reduce attrition rates.