Employee Retention in an Organization

Focus

Human resources are the life-blood of any organization. Even though most of the organizations are now a days, found to be technology driven, yet human touch and human resources are required to run the technology.

The biggest challenge that organizations are facing today is not only managing these resources but also retaining them. Securing and retaining skilled employees plays an important role for any organization, because employees’ knowledge and skills are central to companies’ ability to be economically competitive. Besides, continuously satisfying the employees is another challenge that the employers are facing today.

Keeping into account the importance and sensitivity of the issue of retention to any organization, this article focused to discuss various available findings on employee retention and the factors affecting employee retention and job satisfaction among the employees.

Factors affecting Employee Retention

There are number of research findings and articles to highlight the various factors which affect retention initiatives in an organization. I have selected few literature reviews that discuss the topic in this article.

Fitz-enz (1990) [19] recognized that employee retention is not influenced by a single factor, but there are hosts of factors which are responsible for retaining employees in an organization. Management need to pay attention to factors such as compensation & rewards, job security, training & developments, supervisor support culture, work environment and organization justice etc. According to Osteraker (1999) [20], the employee satisfaction and retention are the key factors for the success of an organization.

The Retention factor can be divided into three broad dimensions.

1.     Social

The social dimension consists of the contacts that the employees have with other people, both internal and external.

2.     Mental

The mental dimension of retention consist of work characteristics, employees always prefer flexible work tasks where they can use their knowledge and see the results of their efforts which, in turn, helps in retaining the valuable resources.

3.     Physical

The physical dimension consists of working conditions and pay.

While concerning the above dimensions, below have over-viewed of various factors of employee retention, highlighted by various researchers.

 Compensation

Trevor et al. (1997) [28] has proved that rise in pay has a positive impact on employee retention. Although compensation was not one of the top factors influencing non-management turnover but compensation can act as a critical factor in reducing managerial turnover and increasing commitment.

Reward and recognition

Surveys have revealed that recognition is important for workers and they want to listen that their work recognized and appreciated. Silbert (2005) [35] forwarded the view that reward is important because it has an enduring impression on employees which, in turn, gives the employees an impression that they are valued in the organization.

Promotion and Opportunity for growth

Pergamit and Veum (1989) [36] in their study found a close and positive correlation between promotions and job satisfaction and which in turn helps in retaining employees. Prince (2005) [38] argued that talented employees are required for maintaining a competitive advantage and employees want career growth opportunities to develop and rise in their career ladder. Such plans include advancement plans, internal promotion and accurate career previews at the time of hiring.

Participation in decision-making

Noah (2008) [41] found in his research that employee involvement in decision-making helps in creating a sense of belongingness among the employees, which helps in creating a good congenial working environment and contributes towards building a good employer-employee relationship.

Work-life balance

Work-life balance is increasingly important for engagement and affects retention. Hyman et al., (2003) [42] in their empirical research in the UK found that interventions of work demands into personal life (e.g. working during the week-end) resulted into heightened stress and emotional exhaustion among the employees.

Work environment

Wells & Thelen (2002) [45] have stated in their study that organizations which have  generous human resource policies, have a very good chance to satisfy and retain employees by providing them an appropriate level of privacy and sound control on work environment which enhances the motivation levels to commit with the organization for the long term.

Training and Development

Messmer (2000) [47] found that one of the important factors in employee retention is investment on employee training and career development. Tomlinson (2002) [48] forwarded the view that organizations can keep the leading edge in this competitive world by having their employees well trained in the latest technologies.

Job Security

Abegglen (1958) [55] found during the study of Japanese workers that employment features like lifetime employment and seniority system, job security lead to high commitment, job satisfaction as well as retention of employees in an organization. Rosenblatt and Ruvio, (1996) [58] conducted a research on the job insecurity and found that job performance and organizational commitment are negatively correlated with job insecurity. 

 Human resources are complex and not easy to understand. These are the assets which can make as well as break an organization. Retaining them will help in the long-term growth of an organization and will also add to their goodwill. But the most difficult task faced by an organization today is retaining as well as satisfying these resources. I tried here is to discuss few research findings and contributions forwarded by various researchers in the area of employee retention and job satisfaction, but still much scope remains for more exploration since this is broadly discussed topic.

References

Fitz-enz, J. (1990).Getting and keeping good employees. In personnel. 67(8): 25-29

Osteraker, M.C. (1999). Measuring motivation in a learning organization. Journal of Work Place Learning.

Trevor CO, Gerhart B, Boudreau JW (1997). Voluntary turnover and job performance: curvilinear and the moderating influences of salary growth and promotions. Journal of Applied. Psychology., 82(1): 44-61.

Silbert, L.T. (2005). The effect of Tangible Rewards on Perceived Organizational Support. Management Sciences.

Pergamit, M. R. and Veum, J. R. (1999), “What is a promotion?” Industrial and Labor Relations Review, Vol. 52 No. 4, pp. 581601.

Prince, B.J. (2005). Career-focused employee transfer processes. Career Development International, 10(4), 293-309.

Noah, Y. (2008) A Study of Worker Participation in Management Decision Making Within Selected Establishments in Lagos, Nigeria. Journal of Social Science, 17 (1): 31-39.

Hyman, J. and Summers, J. (2004), “Lacking balance? Work-life employment practices in the modern economy”, Personnel Review, Vol. 33, pp. 418-29.

Wells, M., & Thelen, L. (2002) “What does your workspace say about you? The influence of personality, status and workspace on personalization.” Environment and Behavior, 3: 300-321.

Messmer, M. (2000). Orientations programs can be key to employee retention. In Strategic Finance. 81 (8):12-15.

Tomlinson, A. (2002). High Technology workers want Respect. Survey Canadian Human Resources Reporter, vol. 15, issue 3, and p.2.

Abegglen, J.C (1958). The Japanese Factory. Aspects of Its Social Organization. Free Press. Glencoe. IL.

Rosenblatt Z, Ruvio A (1996). A test of a multidimensional model of job insecurity. The case of Israeli teachers. Journal of Organisational Behaviour., 17: 587- 605.