Introduction: Today, It has become the fundamental gainsay for the organizations to retain the most talented employees. Hiring knowledgeable employees on the job is essential for an employer but keeping those employees even more important than that of hiring. There are many companies who are always searching for talented employees so such employees have no shortage of opportunities. In this era, employee retention is becoming a critical issue as the result of shortage of skilled labor, economic growth and employee turnover. Many of the companies are facing problems in retaining employees. Although it is hard to measure the exact cost of turnover because a current employee holds with him the knowledge about company, costumers and the past history so when he leaves the organization everything is gone with him, sometimes to competitors, so the exact loss cannot be realized but the industry experts often quote 25% of the average employee salary as conservative estimates. (Importance Of Employee Retention) So we need to understand that basically itself employee turnover is not a disease but it is a symptom of the disease i.e. Failure to retain employees. The main problem under study in this research is “The impact of human resource practices on the retention of employees”. Effective employee retention is the result of systematic attempt by employers. It needs to develop and establish an environment that attracts employees to stay in the organization by following policies and practices in place that meet their needs. It also concerns with the costs associated with employee turnover. Hiring a new employee costs are usually 2.5 times the salary of an individual. The total estimated costs of turnover may include lost customers, busin... ... middle of paper ... ..._retention.htm • Importance Of Employee Retention. (n.d.). Retrieved May 22, 2010, from retention.naukrihub: http://retention.naukrihub.com/importance-of-employee-retention.html • Nair, S. S. (n.d.). Employee Retention. Retrieved May 23, 2010, from articlesbase: http://www.articlesbase.com/human-resources-articles/employee-retention-995426.html • Retaining employees. (n.d.). Retrieved May 22, 2010, from bdc.ca: http://www.bdc.ca/en/business_tools/ask_professionnal/archives/hr_retain.htm?iNoC=1 • Sarin, A. (n.d.). Role & Importance of Employee Retention - HR Article. Retrieved May 22, 2010, from contentwriter.in: http://www.contentwriter.in/articles/hr/employee-retention.htm • Sinnott, G. C., Madison, G. H., & Pataki, G. E. (2002). EMPLOYEE RETENTION. New York State. • Wisnefski, M. (2008). Employee Retention In The New Millennium. BUSINESS SERVICES , 16 (3).
Human Resources practices retention for the massive cost and time taken it has to replace and hire new employees. Hiring has such a high cost for the facts of ensuring all new employees meet the expectations and requirements for a business. Not only do new employees have to meet the company’s expectations but also pass employment tests, physical exams, and background checks (Nickels (290-346). They also consider consumers habits and help form solutions to meet the businesses and consumer’s needs to keep up the company up to date. (Alper (112-113). Human resource personnel also help companies evolve with new innovations. Human resources help establish future labor by helping the companies find employees that meet the new requirements. Human resources personnel also forecast future requirements for organizations that way they can ensure trained people will be on hand for the organizations (Nickels (290-346). “In the future, human resource management may become the firm’s most critical function, responsible for dealing with all aspects of a business’s most critical resource: people” (Nickels (290-346). Human resources not only has a future of importance, but its past shows its importance now. From being responsible for only one department to being in many and still predicted to grow to being in charge of many more
Employee turnover represents a practical problem to an organization in terms of loss of talent and additional recruitment and training cost. Only a few studies have explored the effects on intention to leave (i.e. Daily & Kirk 1992) . Therefore, the underlying process through with organizational perception leads to employee turnover remain largely unknown. I am not going to consider gender, age or race in this study. I am not going to consider individual employee titles. I am not going to study samples of over 60 people. I am not going to divide HR non-exempt employees by individual HR departments.
In the past, Irontown Inc. has gone through the process of developing a short-term staffing plan and redeveloping their candidate assessment and selection procedures to better fill their customer service representative (CSR) positions. Now, they are wanting to develop a retention plan that will support their overall staffing strategy for their company. The new retention plan is vital because they have decided to retain their customer service department (CSD) internal, hopefully reducing their turnover rate by 20% per year over the next three years. If Irontown’s new retention program meets their objectives by the end of the first year, they are going to invest in a new CRM software program. Irontown’s HR department has requested the last 120 employees who left voluntarily to participate in an exit interview. They will collect data from these interviews, form focus groups, determine what the issues are, and then use this information to develop a retention plan that supports the overall staffing strategy of the company. While evaluating this case study, this author will take a look at the key and underlying issues, the facts that affect these issues, recommend a solution and a plan implementation, and conduct follow-ups.
Employee turnover costs are very costly to a company. Turnover not only affects the bottom line but also affects the company’s morale. We are analyzing the problems within our company that are causing our employees to become unsatisfied with their job. Then we are going to find solutions. And then do the cost estimates of the turnover costs and the turnover savings after our solutions are implemented.
As I researched and viewed my topic, I realized that retention is broader then I thought. All along I thought retention was just about retaining employees but I found out the system to retain employees and it’s factors. I found the key elements that effect retention to be very interesting. I didn’t know that retention can be broken down into to 3 dimensions which are social,mental,and physical. The social consist of the contact with people, mental consist of work characteristics, and physical consist of working conditions and pay. These three elements show that retention can be broken down psychologically. Since the terms can be broken down psychologically, it allows an employee to look into retention more closely. I
A continued globalization of markets, hostile takeovers and rapidly advancing technology has made it very difficult for the organization to achieve competitive advantage. Employees are one of the most important determinants and leading factors that determine the success of an organization in this competitive environment. Every organization must address its employee needs in order to maintain a productive work force. In today’s fast paced society turnover rate of the employees is quite high and employees keep switching among different jobs. One of the reason behind this that employee may not feel any sense of association with the organization and that they may not feel a sense of shared goals with the organization (Ackoff, 1999). Managers are interested in maximizing their workers’ level of commitment, as the costs of hiring and training new employees are high. Generally, it is expected that employees are more likely to stay with their organization and be highly committed when they can see a strong linkage between the organization and their work. One crucial reason of high turnover of the employees may be that the employee may not feel committed to the organization. When employees are dissatisfied at work, they are less committed and will look for other opportunities to quit. If opportunities are unavailable, they may emotionally or mentally withdraw from the organization. Thus, organizational commitment is an important attitude in assessing employees’ intention to quit and the overall contribution of the employee to the organization (Naser Shirbagi, 2007).
In the past 20 years, the technology has been improving as well as the behavior of human. Another change that has been significant enough in the workforce is the generation. Since the baby boomers is reaching the retirement ages, the workforce changes its face. During the change of the pace there are many issues regarding the younger generation. Though, the unprepared new labor force brings another issues to the most company. As the new age begin, the company is struggling with the high demand of spending and low output level from the employees. This event challenges the human resource management on the search of potential employees. The consideration breed the pros and cons whether to keep, train and improve or recruit and change the force. The essay will provides the thorough exploration to oversee the positives of developing dedication of the employees. The method will be used are research and case discussion. The objective of the written report is to provide an insight of the importance of loyalty from the employees.
An organizational human resources department utilizes the hiring and firing process to meet the organization’s personnel needs. Organizational human resource departments are charged with the oversight of an organizations administration department. The practice of hiring and firing people is a process employer’s conducts on a daily basis. This process has to be done in a proper manner and not in haste. The implication that can occur from the improper hiring and firing process could and can have a positive or negative impact on an organization. Therefore, employers must carefully evaluate their decision to hire/fire individuals and its impact on the organizations’ workplace environment and others employees. Human Resource Management is important for an effective organization. In today’s organization, HRM is valuable to the organization because of increase legal complexities and its known for improvement in productivity. However, management should realize that poor human resource management could result in an outburst of hiring process followed by firing or layoffs. According to (Satterlee 2013, p. 194), “Hiring the best candidate who is also a good fit for the organization is crucial for the success of an organization, because a poor hiring decision will have repercussions across the entire organization”. Satterlee made a valid point because poor hiring could have an impact on the bottom line performance of the firm. In other words, HRM is the contributing factor to the success of the organization including motivating and maintain the staffs. The purpose to the motivation is to ensure that all employees grow to a full potential. According to (Sims 2006, p. 5), “HRM efforts are planned, systematic approaches to increasing organizati...
Abassi et at (2000) state that faulty recruitment practises, management style, working environment, lack of competitive pay package that results in employee exit. Louis (1980) concludes that turnover occurs as new employees compare their past work experiences with the present work experience. They set up expectations when not met resulting in employee
The term of turnover is defined as the ratio of the number of organizational members who have left during the period being considered divided by the average number of people in the organization during the period (Price, 1977). Gusafson (2002) stated turnover term also often utilized in efforts to measure relationships of employees in an organization as they leave, regardless of reason. However it is different for Xiancheng (2013), he mentioned that employee turnover is a method of personal issues who decides to stop associate with the company for better advantage. For Kirschenbaum & Weisberg in their research on 2002 considers turnover inevitable. Naumann (1992) identified that turnover as it “typically refers to the separation of an employee from the firm”, but it is different for Birdseye & Hill (1995) where are they have broadened the intent-to-turnover concept to include two internal turnover variables (intent-to-leave the location and intent-to-leave the job) as well as the more widely used external turnover measure (intent-to-leave the organization). Turnover at work place has received attention by many researchers (Richer, Blanchard & Vallerandi, 2002). Mangers and researchers consider turnover a problem because of costs associated with it (Lucas et al., 1987 and Soon et al.,2005). There are many factors that contribute to employee turnover in an organization. In 2013, Kraturerk & Khemarangsan were identified unsupportive leadership, disparity in labour market, bad work climate or environment (working stress), and job satisfaction result to the employees turnover. Based on my study, job satisfaction and work stress is the main reasons why employees intend to turnover. Mobley (1997) stated that employee...
The purpose of this report is to brief the management on the importance of employee satisfaction in achieving the competitive goals of the organization through increasing the retention of the employees.
While calculating turnover costs various costs such as cost of recruitment of the replacement, and also including the cost of lost opportunity, the cost of employee turnover has is somewhere around 150% of employees’ remuneration. This cost include both direct and indirect costs. Direct costs consists of cost of the leaving, cost of replacement and cost of transition, and indirect costs include loss in producti...
Employee turnover in organization is one of the main issues that extensively affect the overall performance of a workplace (Tariq, Ramzan and Riaz, 2013). Various studies show that employee turnover negatively affect the overall efficiency at the organization (Tariq, Ramzan and Riaz, 2013). Xiancheng, (2013) mentioned the employee turnover is a method of personal issues who decided to stop associate with the company for better advantage. There are two types of turnover which are voluntary and involuntary turnover. Voluntary turnover can be defined as the termination of the official and the psychological contract between the employee and employer (Krausz, 2002; Macdonald, 1999; Mclean Parks et al, 1999; Rousseau, 1995) while involuntary turnover inescapably lead to direct negative results such as current job is insecurity, work difficulty, and status fluctuation (Gowan and Gatewood, 1997). However, other researchers such as Haven-Tang and Jones, (2012) concluded poor management, lack of salary, bad working environment and paucity of job opportunities could be the highest causes of turnover among organization. This statement was support by Kusluvan et al., (2010) where is they had stated that poor management, low payment of salary, work environment and lack of employees’ job opportunities on the organization will make employee want to quit from their job. Turnover intention situation will appear when labour had feeling that they want to quit from current job, so voluntary and involuntary turnover will become final stage for them as their decision (AlBattat and Mat Som, 2013) but it is different for researchers such as Mosadeghrad, Ferlie and Rosbenberg (2013) when they conclude that employee turno...
673), retention management must be based on three types of turnover, voluntary, discharged, and downsizing. Not all businesses are freighted by turnovers, for some it is the way of life and cost is built into the budget. However, for others any type of high turnover can be detrimental for company profit, employee wage and benefits offered. First, let’s take a look at voluntary and involuntary turnover that affects retention. Voluntary turnovers are caused by many different reasons. Turnover may result from topics such as job dissatisfaction, job mismatching, knowing that job opportunities are plentiful. Two reasons that I will discuss more are micromanagement and employee loyalty. Like stated before in the introduction, when employees are dissatisfied, possibly due to being placed in an area that doesn’t fit with their skill set, one is more likely to seek new employment. Another part of turnover is discharging and downsizing. Discharge is just that, members being discharged due to discipline and job performance. While downsizing turnover is a result of business being overstaffed (Heneman III, Judge, Kammeyer-Mueller, 2015, pg. 675). There are also other reasons for voluntarily employee turnover, such as generation differences when it relates to employment. The current generations are more likely to see a job as one piece in their life puzzle rather than as the first, indispensable anchor piece without
Staff’s intention to leave would always lead to staff voluntary turnover. When staffs has the intention to leave, there must be some factors that cause that feeling of intention and these factors are the major keys to understand and manage staff voluntary turnover. Staff turnover is always a major concern in an organization. An organization, regardless of size, technological advances, market focus and other factors are facing retention challenges. It would not only lead to higher cost of replacement, it would also influence the staff morale, customer satisfaction as well as customer loyalty. Therefore, staff retention is much more important before the staff turnover happens.