Attrition rate of Oceanic Restaurant industry is the fastest emerging industry especially in the state like Goa, which

exert a pull on tourists. A major portion of the states income comes from hotel and restaurant industry as Goa is the major tourist destination. It employs a vast population. But the major problem faced by this industry is a high rate of employee turnover. General reasons for employee turnover 1. The most common cause for employee turnover is the salary scale i.e. the employees do not hesitate to leave the job if they are offered with a better salary by other rivals. 2. Personal problems as most of the employees are from outside Goa, they leave the job as they want to go to their villages and other prospective work areas. 3. Employees leave the organization if they do not get the necessary benefits. 4. If the working environment is not appropriate for the employees the employees lookout for jobs that offer them suitable working environment. 5. Sometimes the employees cannot adapt to the working procedures of the work place.

Mr. Prashant Korgaonkar pursued his MBA degree from Bombay in 2004. He is a very hard working person and goal oriented. His aspiration was to own a restaurant in Goa as its his native place. To buy a restaurant he required a huge capital investment so, he found an opportunity to take a hotel on lease on contract basis. His restaurant Oceanic is located in Baga, Goa. He started his business in March 2005 with four employees. After 6 months of commencement his restaurant was quiet popular because of good sea food and services provided. During the peak season, the number of customers increased to a great extent and it became difficult for the staff to manage the customer crowd. So he decided to hire four more employees. All his employees were from outside Goa. accommodation. The employees work in two shifts, the first shift of 7am to 3pm has 1 cook and 2 waiters and the second shift of 5pm to 12pm has 2 cook and 3 waiters. But in the peak season sometimes the timings would extend. Mr. Prashant provides the basic facility to his workers like food and

The average annual turnover of Oceanic restaurant is Rs. 6,80,000 including the maintenance. And the average annual profit amounts from Rs. 2,00,000- 2,40,000. Although the business has been running good, it has always been facing employee turnover. The employees take experience for 2-3 years and then leave the job. Few of them leave the job and go back to their villages. Attrition rate for 5 years Year 2006 2008 2009 2010 2011 Salaries paid Designation Cook Waiter No. 3 5 Salary amount 5000 per month 3000 per month Employee turnover 3 2 4 3 2

Problems faced by Mr. Prashant Many a times due to sudden employee turnover Mr. Prashant failed to get enough replacements to substitute those who had left, and then the remaining work has to be done by existing employees. This puts too much pressure on them and most of them do not offer good quality customer services as they did before. Additionally, others do not handle all their tasks well and this diminishes the restaurants competiveness. Labour turnover also affected the restaurant both indirectly and directly. Direct costs are incurred on advertisements, selection, management time and hiring temporary staff which amounts to the reduction in Mr. Prashants profits. The indirect costs are; low employee morale, higher pressure on the job, high costs of learning, poor restaurant service quality. Once when the Chef left the restaurant there was a decrease in the satisfaction level of the regular customers as pervious chef was one who provided the restaurant with a competitive edge.

Suggestions for Mr. Prashant

Rework the Hiring process In order to avoid Employee turnover, the hiring process itself needs to be worked on. For instance, hiring could be done from the local areas, instead of hiring non residents of Goa. Overtime Policy

Employees should be provided with the adequate allowances and facilities during their overtime, if they happened to do so, such as overtime pay.

Increments & Bonuses The employees should be given yearly increment in their salary on the basis of their performance. Bonuses can also be provided to them. Gifts during festivals can also be given as a part of non monetary benefits. Customer Service Award This is with relation to quality criteria of the company. The agent that meets the most criteria will be given the award. Cook of the month & Waiter of the month Based on their performance, they are awarded these positions Contract The employees should be hired on written contract basis so as avoid the uncertain risk of attrition. Medical Care & Attention The employees should be provided allowances to get their regular check-ups, say at an interval of one year. Even their dependents should be eligible for the medical checks that provide them emotional and social security.