Lensing to employee attrition rate and internal movement in an organization: Application and intervention through Markov chain

The objective of the paper is to apply Absorbing Markov chain model in the study of employees’ attrition rate of an organisation over a discrete time interval. This requires transition probability matrix to be stochastic and Markov network to have at least one ‘absorbing state’. The paper addresses this problem by associating the employees leaving the organisation with a state, hereafter called ‘ exit state’, which is ascribed to ‘the absorbing state’. The physical interpretation of the probabilistic characteristic of an absorbing state logically relates it to a ‘void’ . The state of ‘void’ has no resource / element in the initial state of the system, and, in the final state, any resource/ element transitioned to this state becomes irretrievable, hence non-contributory to the organisation for all practical purpose. This concept supports the construction of stochastic matrix of Markov analysis. The dynamics of free markets and prevalent meaning of freedom- freedom from fear, freedom from scarcity and freedom from harsh subordination, as perceived by the present-day digital generation, are the reasons behind their good intention to exercise freedom of choosing and changing organisations. It is, therefore, a matter of concern for corporate leadership to ponder over how to retain talented personnel and keep watch over changing trends of employees quitting the organisations. The present paper demonstrates the successful application of our conceptual model by a case study of employees’ attrition rate of an MNC operating in India, discusses the causes of high attrition rate and provides suggestions to leadership for win-win interaction with the employees.