How to get low staff turnover in off-shore arrangements
Off-shore staff are notorious for high levels of turnover. I’m guessing that McDonald’s wherever you live has high turnover of staff too. Is it something about Indians? Is it something about Chicken McNuggets? I doubt it.
Imagine that you have worked, and borrowed, hard to get an MBA. Your parents are proud. Things are even better – you’ve landed a job working with a global financial institution.
Now imagine that your job is filling in spreadsheets. You do this every day – not forecasts, just historicals. There is no leeway as you work to a template. It’s fine though, because the money is good.
The next year, since you’ve worked well, you are promoted. Now you can do company profiles. If it’s not just number crunching then it’s crunching of some sort since you are not allowed to have any analytical content. But you are paid a bit better so that’s cool.
You wonder sometimes who receives your stuff and what they do with it, but these are idle musings. You see your boss go into an office and put on a salesman’s smile and an American lilt as he talks to your client. Glancing through the glass wall of the conference room, you see that your manager seems to nod a lot.
A couple of years later, you are still doing factual crunching. Your pay has gone up with inflation. You’re 26 now. You should be thinking about marrying soon and then raising a family.
Are you with me? Good. Let’s go on. You’ve put your CV out casually and ended up in interviews. You’ve got a job offer – similar firm, similar job, but 10% higher pay. What are we going to do? You’ve got three line breaks to think about it.
2..
3…
Well, why not? We’re off.
Why would anyone be sticky at a job which didn’t stretch them and where no-one cared what they thought? That has been the case with most jobs in the off-shore research space since it started a lucky 13 years ago. In fact, I’d suggest that it has been the case everywhere since time immemorial.
If your off-shoring provider is in the lower value-added space, as most are, then since they are very smart companies, they will have evolved ways to cope. I think that the key in that part of the market is to keep the actual analysts away from the client so that churn is less visible, and to channel direct contact through better-engaged client wranglers.
Things are very different if what you off-shore adds more value than number crunching.
Sticky #1
Analysts need more training, and they need tough training in how to carry out tacit tasks with judgement (aka common sense). From their point of view, the engagement with you adds to their human capital and therefore boosts their careers. Check out the the Euromoney analyst polls this year (or last year or the year before) and see our alumni at number 1. They stay sticky for the training.
Sticky #2
When analysts are engaged to come up with a view, they are worth listening to. A young Indian analyst might tell you that the DCF won’t tell you nearly as much as the sum of parts for a company, and they’ve done it, and the stock is a dog. If then you do not buy that stock, not only have you made money, but you have generated stickiness. Analysts who are listened to are sticky.
Sticky #3
An analyst adds value to you. They are growing and they are listened to. So the kid who did the job of a second year global capital markets analyst is, three years later (guess what) doing the job of a fifth year analyst. Everyone is after them, from London desks to Mumbai PE. People like us had better pay them.
The off-shore researchers which Frontline provides to its clients have low turnover. They get all the three stickies, and so our clients get great work and analysts who grow with them. Get in touch if you’d like to discuss how we can get you great analysts off-shore or, if you already have them, let us show you how you can upgrade.