How to Retain Expert Employees in an Organization - Research Paper Example

EMPLOYEE RETENTION By (Name) Course Professor’s name University name City, State Date of submission How to retain expert employees in an organization Introduction The business environment is increasingly becoming competitive. Every aspect of an organizational operation is influenced by technological advancements. The labor market is also changing at a high rate. Employees are increasingly becoming knowledgeable and have mastered their rights. There are labor numerous rights put forth by different local governments top protect the wellbeing of employees. Furthermore, with the advent of the internet, employees can now find more information about their rights in organizations. This increased awareness has made employers be cautious in managing employees because failure to satisfy employee needs is always more likely to result in resignation by the employees. High employee turnover can be very detrimental to an organization. Therefore, business organizations thrive at retaining its workforce (Taylor, 2002). Numerous strategies have been formulated to help retain the top talent and reduce or eliminate employee turnover. Typically, employee retention refers to the process where the workers are made to stick to an organization for a longer period. The current employees are unique and different, they are perceived to be highly demanding, they articulate opportunities in hand (Schermerhorn, 2005). Most employees as soon as they are not contented or are dissatisfied with their employer, they easily switch to the next employer who they feel have a better terms and conditions than the current employer. It is the sole responsibility of employers to retain their workforce. Employee retention is advantageous to both the employee as well as the organization. If top employees are not retained, the organization is more likely to be left with no good employees. Employee retention is complex and requires a lot of energy, effort, and resources, however, best results are accrued when it can be achieved (Numerof & Abrams, 2003). Employers must have effective strategies in place to retain its expert workers and also attract to attract and retain top talent in the labor market. Most of the successful organizations have realized the need for employee retention; they have realized it will go a long way in sustaining their leadership as well as growth and development in the marketplace. Employee retention needs to make a core element in an organization’s management strategies. It is this regard that this research study seeks to examine how to retain the efficient and expert employees in organizations. Literature Review and Research Questions The topic of employee retention has attracted a lot of research studies from various scholars as well as academicians. Most of them have divergent ideologies regarding the employee retention element. This section will analyze the past literature in a bid to have a better understanding of the research problem. Specifically, the information will be based peer reviewed journals and articles. Theory relating to employee retention will be examined, and a critical analysis of other people’s research will also be provided. Justification of the problem It is undoubtedly clear that most industries are experiencing high labor turnover. High labor turnover is detrimental to an organization’s operations. Therefore, business organizations need to ensure that they retain their expert and most experienced employees. However, most organizations have not realized the significance of employee retention. Thus this research study aims at highlighting the significance of employee retention to employers and why they need to put a lot of emphasis on this issue. Thus, this research study was motivated by the existing lack of unawareness by business organizations on the need of retaining its workforce. Research questions The following were the research questions used in this study 1. What are the factors affecting employee retention? 2. What are the strategies that organizations use to retain their expert employees? 3. What are the causes of employee turnover? Employee retention: conceptual framework Taylor (2002) has explored different aspects of employee retention and retention. They define employee retention as the voluntary retention of an employee from a company. They have provided a framework on retaining valued employees. The below diagram displays the framework; In order, for employers to be able to retain their employees, they need to understand this turnover framework to have a clear understanding of how they can retain their employees. Organizations need to differentiate between involuntary and voluntary turnover then take control. Theory x and theory Y This theory represents the two conflicting ends of the employee motivation spectrum. Employee retention is greatly pegged on motivation that is offered by an organization. Theory X depicts that employees will only perform when motivated through external sources. This theory puts forth that employees who are well motivated tend to stick to their employers for a relatively longer as compared to employees in organizations where they feel they are not motivated. External forces can be such as; compensation, rewards among other forms of employee motivation can be used to motivate employees. Consequently, theory Y puts forth that workers can be internally motivated find pleasure in thriving to obtain goals that use their experience and skills. Both theories are dependent on the work setting as well as the kind of employees being dealt with. When business organizations apply the wrong theory in the workplace can confuse, disappoint or aggregate the workers who might result in employee turnover. Employees who are self-motivated or make decision s on their own are more likely to remain in a work environment with strict supervision and tough rules, however, for employees who are mainly motivated by external factors are likely to change to other workplaces. Factors affecting employee retention Many researchers ascertain that unnecessary employee turnover results in unnecessary expenses to the organizations. The costs incurred in training and replacing employees have a direct impact on the company’s costs, performance, and organizational productivity. Due to this fact, many organizations are increasingly opting for employee retention as essential strategic issues. Carsen (2002) argues that the primary need to retain employees is to ensure that their expert employees stick to the company because loosing such employees can have dire consequences to the service delivery as well as productivity. Retention activities refer to the activities that are aimed at improving organizational commitment of the workers to providing them with opportunities to grow and outdo others (Koontz & Weihrich 2007). Today, there are numerous managerial approaches to retention, the dynamic nature of the labor market as well as evolution in research technology and methodology, the issue of employee turnover has become a vibrant field of study with numerous researches trying to attempt solutions to the answered questions. The attraction and retention of best qualified, expert and experienced employees are becoming a necessity today more than ever before from the managerial perspective. Trends such as globalization are making it vital for employers to retain their employees (Carsen, 2002). The importance of job retention is driven by the high costs of labor turnover and labor shortages, especially in critical industries. Spencer (2000) in his research have found out that even jobs that do not necessarily require specialized skills, a retention strategy used can have positively impact turnover, engagement and the overall financial performance particularly, those involving interaction with customers. Managers in a bid to reduce employee turnover have implemented human resource practices and strategies that are aimed at reducing employee turnover. Extant literature has undoubtedly proven the importance of employee retention and training for the survival of an organization. Researchers such as Allen & Bryant (2012)have stated that the annual cost incurred in employee turnover accounts for between 50-150% of annual salary compounded by the aging workforce and shortage of skilled manpower (Maslow, 1999). They also fathom that employee turnover is usually accompanied by training and heavy replacement expenses. Thus, organizations need to place a lot of precedence on employee retention. Some of the strategies that business organizations to retain their employees Recruiting the right employees from the onset, academicians and scholars ascertain that this is the best technique to reduce worker turnover. Human resources managers need to conduct and thoroughly evaluate candidates, not just to evaluate their skills but rather to also ascertain that they best fit into the organizational culture, fellow employees as well as the managers. Compensation and benefits: it is prudent to set the right compensation and benefits for employees. Human resource personnel need to conduct a market research to determine what similar organizations are offering as compensation (Schermerhorn, 2010). Based on the findings they can establish a more competitive pay packages that can attract and retain top talent in the labor market. They will also be capable of creating flexible working schedules, structures and bonus structures (Dibble, 2000). Most scholars also affirm that employees will tend to stick to companies where they receive better pay packages than in organizations that offer unattractive packages. Similarly, when designing the pay packages they should be made in a way that it does not cause a strain the organization’s financial resources as well as match the needs of the job position. Pay attention to employee needs: to gain ensure the wellbeing of employees, it is recommended that employers should focus on the personal needs as well as provide them flexibility (Sheridan, 2002). Provision of services such as telecommuting, back up or on-site care and compressed schedules motivates employees and induces them to remain in the organization. In this way, the company will have indirectly retained its employees. Strengthening employees’ engagement: humans are social beings, when provided with a rewarding work environment they tend to stay motivated and would be hesitant to shift their job positions. Furthermore, provision of thing such as recognition, awards, and praising are also essential in motivating employees as they are made happy and productive workforce (Dibble, 2000). Career development: Provision of on-site or off-site training also goes a long way in encouraging employees to remain in the organization. Employees will feel that the organization cares about their needs and wants the best for them regarding their career development. Thus, will tend to put their efforts into the organization and produce the best (Sheridan, 2002). In this way, the organization, as well as the employee, will benefit in the sense that employees will have gained career advancement, and the employers will gain improved performance and save on employee turnover as employees will be hesitant to shift their jobs. Causes of employee turnover There are many factors that drive employees to shift their job positions. These factors are always intrigued by the employer or the employee. Some of the factors include; poor performance management, failure to select and hire the right employees, failing to acknowledge good performance and lack of a supportive environment. Other factors include lack of employee communication, failing to accord employees the needed respect, lack of career growth and development opportunities, a culture of poor motivational climate and trust, lack of job satisfaction and empowerment (Samuel & Chipunza, 2009). Research methodology This part will look at the techniques the researcher implemented in carrying out the research. It is divided into the following subheadings; target population, research design, , data collection, research instruments, instrument reliability and validity, data analysis techniques sample size and sampling techniques and the procedures that will be used. Research Design: The research design adopted by this study was the survey design. This research design selected was deemed important in answering research questions by informing social scientists about the status of a population, in this case, the current state employee retention levels and as well as its impacts will be assessed to give a statistical information to human resource managers. Moreover, the researcher relied on survey designs since they can reveal connections and relationships between variables the protocols types and their efficiency. Target Population: Population, typically, refers to items or people under consideration. This research involved a total of seven respondents. The respondents mainly comprised of employees and employers and officers of the labor unions. The sample size is deemed adequate because it is manageable and an accurate finding can be obtained from the sample size. Sample Size and Sampling Technique: Typically, the steps followed in choosing number of subjects are defined as sampling. The sample size of this research comprised of seven respondents that will be chosen based on random sampling. The aim is to get an accurate overview of the current trends in the labor market that relate to employee retention. Research Instruments: The researcher relied on self-administered questionnaires. Questionnaires gave the participants the ability to state their perspective or viewpoints and also to make recommendations. The researcher had interview questions for the employees and employers. Questionnaire for employees: The questionnaires were used to obtain data on their perception as well as their attitude regarding the employee retention. They were asked to state some of the factors that make them shifts job positions or work organizations. Furthermore, they were asked to state some of the factors that motivate them to stick in one job position or organization for a longer time. Moreover, they were also asked to highlight some suggestions on that they can give to human resource personnel that can help them retain their experienced and expert employees. The questions were also tailored only to focus on only the aspect of employee retention. Data Collection Procedures: The researcher obtained a permit from the department of human resources as well as a permit from the ministry of labor. The questionnaires to pilot the study were delivered by the researcher to the selected respondents. The researcher collected the filled in questionnaires within two weeks to avoid losing them. Two weeks was deemed adequate time to fill the questionnaires as well as to seek any clarification that could be needed in the research questionnaires. Data Analysis and Techniques: The study was expected to generate both qualitative and quantitative data. The five-point Likert scale will be incorporated in this research. T-tests were used for the analysis of the differences in expert or experienced employee retention. Chi-square analysis will be adopted to compare employee’s extent of career development. Data were analyzed according to objectives of the study. Quantitative data was evaluated using the standard deviation in the SPSS (statistical package for social sciences), qualitative data, on the other hand, will be coded, organized and thematically analyzed. Discussion and Analysis of Data Employee traits From the research, it was determined that the average employee tenure was at 8.2 years. Older employees had longer tenure period as compare to the younger employees relatively. Further, the older employees, just as expected were found to have served in some job positions as compared to the younger population. 38% of the respondents stated that they had a high school diploma, 30% had an associate’s degree, 29% had completed a bachelor’s degree and only 1% had a graduate degree diploma. More than half of the respondents who had pursued an associate’s degree stated that they were currently pursuing a baccalaureate degree in the neighboring University. Most of them acknowledged felt that they needed to advance their careers to advance faster in their careers. Successful employee retention strategies All the interviewed employees had different reasons for their job or organizational turnover. Approximately half of the respondents stated that the location of their current organization as the main reason for sticking at their organizations. Most of them preferred to work in places that are close to their place of residence. Many of the respondents argued that they would rather prefer to work in an organization that has a short distance to commute as compared to long distant organizations. Compensation was cited by the majority of the employees as the next major factor. 70% of employees ascertained that they are at their current organizations because of the pay packages that they are being offered, which is relatively higher as compared to other competing organizations. Moreover, provision of other benefits such as the provision of bonuses and free commuting encouraged employees to stick at their current organizations. The job itself was cited as the next most-cited reason. Almost 30% of the respondents stated that they are at their current organization due to the nature of their job which they perceived to be fulfilling and rewarding and were hesitant of shifting their job positions. The employees were mainly driven by the organization primarily because of the job responsibilities. The organization’s reputation was also quoted as a contributing factor by 28% of the respondents (Maclean, 2001). Other reasons cited by employees that area a contributing factor for their stay at their organizations are career development options, the organizational cultures, job security, challenge, attractive benefits, empowerment, training and development among other factors. Potential factors that resulted in employee turnover The researcher sought to find out why employees would choose to shift from their current organization. Lack of opportunities, salary, and inability to advance in career were the most significant factors. Other cited factors included ineffective leadership, lack of teamwork in the work environment, lack of recognition among other factors. Reward and recognition The most cited forms of rewards and recognition cited by the respondents were salary increases, verbal recognition and gift certificates. A salary increment depicts an improvement of the employee over the past one year, taking of additional responsibilities or a successful completion of a particular project. Gifts certificates are mainly used in retail stores, restaurants, movie tickets among other service or product industries. They are mainly given to employees to who have placed an extra effort in completing a given task. It is also used to resolve a customer complaint in a more effective and prudent manner. A handful of the respondents said that flexible work schedules were a form of rewards to them. Instead, they stated that this can also be used as a strategy of reducing employee turnover. When asked about their satisfaction levels they said that their satisfaction levels to be between neutral and satisfied. Ethical considerations According to Maclean (2001) ethics simply refers to the accepted codes of conduct in an organization. Ethics can also infer the moral appropriateness of work and proper treatment of employees (McKay et. al 2007). When it comes to employee retention, it is prudent to integrate moral ethics in the process. The retention process as earlier stated is an essential process that has a direct impact on the success or failure. Therefore, ethics must be incorporated in the ensuring that employees are retained. The retention process must be accorded the highest degree of transparency and fairness to ensure that the right candidates are retained for the needed positions. Failure to conform to human resources ethics can have dire consequences to the quality of the employee performance as well as employee turnover (McKay et. al 2007). Activities such as favoritism, corruption, bribery among other unethical behaviors are greatly condemned by proponents of work ethics. When good ethics are practiced in the work environment, the employees are likely to be motivated and stick at their current company and also produce a quality output which in turn has a positive ripple effect on the performance of the organization. In conclusion, it can be ascertained from the above research evaluation that the experienced and expert employee retention plays a substantial role in the overall performance of the organization. Therefore, more focus should be placed on the human resource functions to motivate employees to stick with the organizations; this will, in turn, reduce employee turnover. Consequently, top notch ethics should be incorporated into the organizational culture. Bibliography ALLEN, D. G., & BRYANT, P. C. (2012). Managing Employee Turnover Dispelling Myths and Fostering Evidence-Based Retention Strategies. Sterling Forest, Business Expert Press. http://public.eblib.com/choice/publicfullrecord.aspx?p=1021013. CARSEN, J. A. (2002). HR how-to: employee retention, everything you need to know about creating an effective employee retention program. Chicago, Ill, CCH. CRANE, A., & MATTEN, D. (2010). Business ethics: managing corporate citizenship and sustainability in the age of globalization. Oxford, Oxford University Press. DIBBLE, S. (2000). Keeping your valuable employees: retention strategies for your organization's most important resource. New York, Wiley. KERNS, C. D. (2005). Value-centered ethics: a proactive system to shape ethical behavior. Amherst, Mass, HRD Press. KOONTZ, H., & WEIHRICH, H. (2007). Essentials of management: an international perspective. New Delhi, Tata McGraw-Hill. MACLEAN, P. J. (2001). Taming turnover: creating strategies for employee retention. Edmonton, Silver Creek Press. Maslow, A.H., 1999. A theory of human motivation. Psychological review, 50(4), p.370. McKay, P.F., Avery, D.R., Tonidandel, S., Morris, M.A., Hernandez, M. and Hebl, M.R., 2007. Racial differences in employee retention: Are diversity climate perceptions the key?. Personnel psychology, 60(1), pp.35-62. NUMEROF, R. E., & ABRAMS, M. N. (2003). Employee retention: solving the healthcare crisis. Chicago, Health Administration Press. Samuel, M.O. and Chipunza, C., 2009. Employee retention and turnover: Using motivational variables as a panacea. African Journal of Business Management, 3(9), p.410. SCHERMERHORN, J. R. (2010). Management. Hoboken, N.J., Wiley. Sheridan, J.E., 2002. Organizational culture and employee retention. Academy of management Journal, 35(5), pp.1036-1056. Spencer, D.G., 2000. Employee voice and employee retention. Academy of Management Journal, 29(3), pp.488-502. TAYLOR, S. (2002). The employee retention handbook. London, Chartered Institute of Personnel and Development. http://www.books24x7.com/marc.asp?bookid=4515. Read More