Labour Turnover and Its Impact on Organisations - Essay Example

? Research Paper Contents Contents 2 Introduction 3 The Incident and Crisis of Labour Turnover 3 Labour Turnover and Its Impact on Organisations 6 Organisational Strategies to Counter Labour Turnover 8 Conclusion 10 References 12 Critically consider why organisations should be concerned with high levels of labour turnover and what can organisations do in an attempt to reduce it Introduction Employees are concerned as the life blood of the organisations. The organisational managers are concerned in effectively managing this large pool of human resources through proper training and motivational functions. Training helps in enhancing the productivity mechanisms of the workers and also develops the relationship between the employer and the employees. Similarly different motivational activities both financial and non-financial are also taken to retain the employee base in the concern. Organisations in such approaches tend to render large amount of investment and thereby would endeavour to gain effective returns out of such. Therefore it is highly needed by a business concern to minimize the amount of employee turnover as it happens to impact the profitability parameter of the concern. Employee turnovers in a firm can occur both in a voluntary and in an involuntary manner. Voluntarily the employees can leave the firm owing to rising job pressures or being unable to fit into the required job role. Again a sudden accident or fatal event can lead the concern lose an employee. The employee turnover activity adds to the cost of the concern in that the concern would need to hire another employee to fill the post thus enhancing the recruitment cost. Again losing a skilled an experienced employee leads to considerable productivity loss for the concern (Ongori, 2007, p.50-52). The paper in this connection focuses on understanding the different causes of labour turnover, its impact upon the organisations and thereby the process in which the concerns would rightly counter such events. The Incident and Crisis of Labour Turnover The incident of labour turnover to business organisations remains a subject of continuous research as to understanding the probable reasons that tantamount to the rise of such circumstances. It is found that employees working in business organisations having low supervision and training facilities tend to feel isolated from the upper management. These people thereby tend to drift away from the main organisational objective and in a bid of frustration turn out from the organisation. Similarly a concern rendering enhanced emphasis on the training activities but working less on helping to enhance the productivity of the workforce also face similar problems. The organisation with less focus on enhancing the compensation aspects and also in rendering of other benefits happens to disturb the interest and productivity of the workers. Workers would thus endeavour to shift from such no gains concern to high gain jobs where they would be able to gain high increments both in the compensation package and other benefits. Thus absence of proper supervision and training mechanism coupled with a poor pay package with no proper increments happens to provoke the employees to take to new jobs. Hence the event of labour turnover significantly emerges onto the business scenario (Mudor and Tooksoon, 2011, pp.41-45; Aswathappa, 2007, p.615). The factors that contribute to the growth of labour turnover problems in the organisation can be broadly grouped into two main types-internal and external. In the internal scenario the employees can get frustrated owing to the internal job policies of the concern for which they tend to quit the concern. The policies of the concern can largely change in relation to the technological and structural framework of the concern making the employees feel uncertain about their job and employee security. This tantamount to the employees seeking jobs in other stable concerns. Moreover a change in the management structure of the concern also happens to change the outlook of the supervisory tem towards the workers leading to increased frustration in the work environment. Thus workers in a bid to show their inner grudge against the management body tend to quit their jobs. Similarly other scenarios may develop in the external framework of the company in regards to any particular industry that disturb the motivational framework of the people concerned. Events like continuous closures or lock outs happening in companies disturbs the employees for which they tend to quit the industry in total. Thus factors both internal and external tend to increasingly contribute to the event of labour turnover in the organisations (Merwe and Miller, 1975, p.150-151; Khurana, Khurana and Sharma, 2010, p.168-170). The crisis reflected by the riding trend of labour turnover problems on a voluntary level can be further studied along three parameters. In the first case the employees may voluntarily opt for quitting the concern owing to the emergence of certain shocking incidents that in turn reduces their intention to serve the concern. Certain policies brought about by the organisational managers may make the work atmosphere not conducive to the employees for continuing their employment practices which in turn instigates them to quit the job. These set of policies brought about in a sudden manner are regarded by the employees as shocking information which makes them quit the job. Apart from the emergence of a shock in the organisation the voluntary quitting activity of the employees can also be viewed as a definite and a planned process. Herein the employees tend to first figure out opportunities in the external market before planning to quit the present employment. Thus the activity of voluntary turnover can also be observed as a predetermined process or set of action. In the third case the employees may tend to develop non-liking to any specific course of events or happenings in the company and in turn endeavour to create a negative image of the concern. People hailing from different social backgrounds may feel that the current set of events are against their cultural mindset and thus tend to increasingly violate the organisational policies and existing image. Employee turnover in an organisation on a voluntary scale thus can be viewed to take place out of three different types of factors tempting the people to take to new jobs in the related field (Morrell et al, 2008, p.143-145; Wilton, 2010, p.161-162). Labour Turnover and Its Impact on Organisations The occurrence of labour turnover tends to largely impact the nature of work and productivity of the business organisations. In cases of retail organisations where the chunk of sales and revenue happens from the realms of sales conducted by the staffs through effective customer servicing functions the level of employee turnover tends to hugely affect such activity. Retail organisations through new set of changes in the policy structures become the home ground attracting large amount of employee turnover. People basically belonging to the sales force level tend to increasingly quit the concern in search of better jobs with increased salary levels. Thus the retail organisations are largely jeopardized by such activity tending to loss of both sales and revenue. Again the level of employee turnover in turn also largely hampers the business performance through reduction in the scale of employee productivity. With employee turnover on the rise the morale of the remaining employees tend to get largely affected that in turn dampens the productivity of the business organisation (Ton and Huckman, 2008, p.65; Hall, et al. 2004, p.555). The occurrence of labour turnover strikes a case of emergency when the incident is broadly triggered by internal and external set of factors reflecting a high sense of job insecurity. This sense of job insecurity tends to create havoc disturbance both in regards to individual employees and also in regards to the organisation at large. In the individual level this sense of job insecurity disturbs the work mentality of the person by increasing the level of dissatisfaction involved with such. This sense of getting dissatisfied with the organisational policies reduces the level of employee motivation and sense of involvement with the concern. These factors thereby disturb the productivity potential of the employees present in particular departments and thereby jeopardises the work of the organisation as a whole. Again such a negative work atmosphere in turn also disturbs the physical and mental health of the workers profusely thereby reducing the performance level of the employees. Again such incidents of high labour turnover happening in significant frequencies also create a dampening image of the concern in the eyes of the public. Decreased level of trust among the existing employees towards the concern makes it hard for the concern to gain any new sources of employment from the external field. Thus organisational managers need to reduce the feelings of tension in the work sphere so as to help reduce the sense of job insecurity. This would help in augmenting the level of honour and employee loyalty for the concern and thereby would help the concern in gaining both on productivity and profitability parameters (Sverke, Hellgren and Naswall, 2002, p.243-246). The above discussion can be diagrammatically represented as follows. Figure 1 (Sverke, Hellgren and Naswall, 2002, p.244) Moreover the level of employee turnover for an organisation tends to increase the level of cost for the concern in a dual fashion. The cost factor of sustaining the labour force gets increased through the making of programs for generating rewards to the workers in terms of their performance levels. This practice of setting rewards for the employees helps in enhancing the sense of loyalty of the people to the concern. The level of human resource cost for the concern also increases in that the company has to again start the recruitment program to help gain fresh people to fill up the vacant positions. Thus overall the cost of human resource operations for the company excels by dearth of such rise of turnover rates of employees in the concern (Rusbult and Farrell, 1983, p.436-437; Sutherland, and Canwell, 2008, p.193). Organisational Strategies to Counter Labour Turnover It is identified that for business organisations lacking a proper communication system between the human resource teams present at different hierarchy levels the employees at the bottom of the organisational pyramid tend to reflect turnover situations. Lack of proper communication systems between the managers and the employees make the latter feel isolated to the organisational ethos and work culture. These people fail to relate them to the organisational policies and thus tend to increasingly quit the concern. Thus one of the main strategies that the organisational managers need to take in this level to cease the frequency of labour turnover is enhancing on the communication paradigm. The managers need to effectively communicate with the lower level team members so as to enhance on the relationship aspects and thus get effective feedbacks from them to revitalise the human resource policies. A proper interactive environment created in the business organisation would help in reducing the level of employee turnover in the concern and thus would also tend to reduce the level of internal conflicts (Tsai, Chuang and Hsieh, 2009, p.831-832; Storey, 2009, p.155-156). The level of employee turnover is found to possess increased relationship to the decline of commitment level of the people in the organisation towards their job and also to the level of dissatisfaction reflected by the people to the operational policies of the concern. It is held that absence of proper mentoring in regards to the employees both within a formal and informal set up relates to the decline of employee morale in the concern thus amounting to decline in the level of commitment. Finally the employ finds quitting the job as the last resort in resolving the organisational conflict. Thus in that one of the best strategy that can be employed is installing a hubby with the employees understood as of grieving nature. The hubby in turn would help in the enhancement of friendship level in the concern and in turn would also help to enhance the level of employee productivity. Employees generally desire working in a friendly work environment such that they can share amongst each other both potential work related information and also other informal talks. This strategy would in turn help in enhancing the level of employee loyalty and commitment level and thereby would tend to reduce the level and frequency of employee turnover. Henceforth cultivation of friendship in the organisation is considered as an effective strategy that would in turn help in reducing employee turnover and enhancing labour productivity (Morrison, 2004, p.125-126; Hakim and Jin, 2010, p.152). The organisational managers need to identify the main factors that contribute to the rise of labour turnovers in the organisation. Employees tend to quit the organisation owing to some internal factors like faltering administration that in turn provokes outcome like sexual harassment and other events like apartheid or racial discrimination. These factors in turn disturb the mentality of the workers to work productively for the concern and thereby quit. In that the managers need to take responsibilities in not only harnessing the emergence of such factors but also in trying to actively counsel the victims of such circumstances. Similarly some job types require an individual to work in a continuous fashion for long hours on a daily basis. Herein the organisational managers need to spice up the work atmosphere through generation of considerable rewards and also through proper counselling activities desired to encourage the people to take to such strenuous roles. The above practices would help the managers in relieving the stress in the concern and in turn would help in enhancing the loyalty and commitment levels of the people (Brough and Frame, 2004, p.9; Bagusat, et al. 2011, p.177). Human Resource managers in the organisation need to take resort to effective strategies that are considered to be set of best practices in the ambit of human resource management to help in the reduction of employee turnover. The managers need to organise the people into different teams to help them form innovative ideas and also need to generate high amount of flexibility to encourage them to take responsible roles in the concern. Organisational managers also need to largely empower the people belonging to different departments to take part in key organisational decision making activities which in turn enhances the responsibility parameter of the employees and also augments the amount of employee loyalty in the concern (Richard and Johnson, 2001, p.300; Chand, 2006, p.190). Conclusion The aspect of labour turnover turns out to be a great problem for the business organisations. Labour turnover as an incident results in the organisation losing a large pool of effective human resources that would help in enhancing the productivity potential of the concern. Moreover the aspect of labour turnover also results in enhancing the cost factor of the business concerns in that the business organisation would first require to sustain the existing labour force through generation of an effective reward system and also in the gaining of new labour forces. Thus the organisations need to work out definite strategies that would help in the maintaining of the right return on the investment made in regards to human resources working out effective policies aimed at reducing the incidence of labour turnover. Herein the organisational managers need to render enhanced focus on designing of employee friendly employment policies aimed at reducing the level of discrimination involved. The workplace should be made highly conducive for the employees to grow and excel by the managers in not only empowering the individuals to participate actively in decision making activities but also in generation of flexibility in the workplace. These set of strategies is considered to help the organisation reduce the level of employee turnover in the concern and thereby would help the business organisation to gain both profitability and productivity in the long run. References Aswathappa, K. (2007). Human Resource and Personnel Management. 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