Table of Contents
I. Introduction
A. Significance of the Study
B. Approach to Investigate the Problem
II. Literature Review
A. Rationale of the Study
B. Staff Performance and Organisational Development
C. Staff Retention in the Workplace
D. Relevance of Literature
E. Synthesis: Applications of the Theory in the Study
III. References
I. Introduction
One of the cornerstones of modern organisation is seen in their proper management of the human resource of the company. On the view of the top management, it is easy to dismiss the low ranking personnel as expendable. However, in the age of mergers, acquisitions and rather rapid life cycles of organisations, the human resource is deemed as one of the most viable assets for companies. A whole lot of companies have taken steps to realise this perspective but it involves real hard work. The management have to recognise the importance of the basic principles of human resource management and the more complex concepts of employee retention. The following discussions shall shed light on this matter.
A. Significance of the Study
The importance of employee retention is highlighted in numerous organisational studies. This paper will be a welcome addition to that class of discussions pertaining to a particular function of human resource management. However, it is quite recognisable that certain aspects of the issues of retention have been left out. For instance, there is a lingering assumption that employee retention is in itself an ends that would trigger organisational development. It is not that simple. Companies print out catchphrases and other company maxims indicating the importance of employees to the company and their actual roles as assets. However, organisational development could only be achieved in its fullest provided that retained employees are well-performing ones.
This paper intends to take on this general objective of finding the critical factors that would retain a company’s well-performing staff in the workplace. In order to achieve this goal, the study intends to answer the following questions:
· What are the tools used by the company in determining employees who are well-performing?
· How does the company do away with voluntary turnover?
· How does the company ensure retention?
· What are the critical factors of staff retention normally used in the workplace?
· Does these critical factors of retaining well-performed staff directly relate to organisational development?
B. Approach to Investigate the Problem
The paper shall employ both quantitative and qualitative from of research. This means that the primary will come from the responses on a researcher-made questionnaire while the secondary data will come from academic journals and scholarly articles. The discussions will focus primarily on the critical factors that retain well-performing staff in the workplace. For clarity and coherence, this paper shall be divided into several chapters. The first chapter shall serve as the introductory part of the paper. It shall establish the objectives and the specific claims held by the researchers of this paper. The second chapter shall provide a discussion on the review on relevant literature on employee retention. These discussions shall cover recent organisational studies on the matter. The third chapter shall describe the methodology used in the course of this paper. Specifically, a description of the methods used in the acquisition and processing of the relevant data is given in this chapter. The fourth chapter shall give the interpretation, presentation and analysis of the gathered data both by qualitative and quantitative means. The final chapter shall provide the conclusions based on the preceding chapters of the paper and consequently propose certain recommendations on the topic.
II. Literature Review
In this chapter, discussion on the past and existing literature on employee retention and the consequent elements of organisational development and staff performance will be taken into consideration. In the end of this chapter, a synthesis of the arguments and observations provided shall be made. This will then be used to relate it as it applies to the overall study.
A. Rationale of the Study
Success of an organisation lies on the proper consideration and management of both the internal and external environments and its direct influence on the company. Recent studies have highlighted the need for flexibility in an organisation’s operations, especially those that operate in the international scale. (Holtom and Inderrieden 2006, 435) It has been regarded with immense importance to vigilantly monitor and supervise the changes imposed in the external environment so as to foresee what shall take place even before the whole impact of these changes provide adverse effects on the company. This is seen in the principles of strategic management and planning. However, a company could only maximise the effects of strategy and planning if their internal environment is more than capable in doing the prescribed amount of work and labour to complement the changes in the external environment. (Frank, Finnegan and Taylor 2004, 12) This could only be done if there is an existing set of well-performing staff in the workforce.
In an ideal world, well-performing staff will always be at the disposal of the company. However, reality has shown that there are critical factors that make this hard to realise. There is the reality faced in any industry that employee turnover being an inevitability. Turnovers could be involuntary or voluntary. The involuntary turnover points to the unavoidability of lay-offs and termination of specific personnel. The voluntary turnover speaks of the deliberate departure of the employee through resignation and retirement. (Frank, Finnegan and Taylor 2004, 12) In any case, the frequency of turnovers tends to impose undue loss on the part of the organisation. The existing studies on this manifest a focus on the element of turnover as a means of reducing const. This study intends to seek another path, to view employee retention as a tool not only for administrative purposes but also to maximise the operations of the company.
B. Staff Performance and Organisational Development
Staff performance and organisational development has been regarded constantly in organisational studies. They have established as basic HR functions that facilitate the realisation of organisational goals. Bailey and Palmer (2005, 11) stated that organisational development has become an important factor of every modern company if they do look for their continued operations in their respective business setting. However, the element of organisational development would not be possible without the competence of the staff. With this ceaseless change that companies need to contend with, a couple of HR concepts and functions apply greatly: training and employee motivation. (Lopez and Truesdell 1995, 197)
Training allows the professional development of the individual units in the company. It is seen as a human resource function that is not restricted to the workers in the rank and file section. (Carrier (1999, 30) Managers, especially in the case of SMEs, satisfy the need to internationalise and globalise heir operations by going through training initiatives seeking to develop their managerial skills and familiarise themselves with the nuances of international operations. (p30)
However, the business environment nowadays develops in a very ferocious pace. Development of skills with regards to the training initiatives a mere part of a programme. (Brown, Durham, Kristoff, Kunder, Olian, and Pierce 1998, 20) In its place, the aim of improving the height of proficiency of the pool of individuals under the employ of the organisation has been the more accepted and common end of the training process. Hence, increasing the company’s competitive advantage is seen with a higher possibility of happening. (Jinabhai 2005, 85)
Another aspect of human resource that seems to be intimately connected to organisational development is employee motivation. Many motivational theories are introduced in the organisational setting. A basic supposition in this regard states that improving the motivation level of the personnel will effectively activate positive results for the organisation. (Neff 2002, 385) Proper communications in the organisation will instil higher motivation levels on the employees. (Gueldenzoph and May, 2006, 4)
C. Staff Retention in the Workplace
In considering human resource policies and retention programmes for the organisation, one has to understand that the human element of the firm is inescapably ever-present. The turnover of key employees can have a disproportionate impact on the business and the people organizations with to retain are probably the ones most likely to leave. (Michael Armstrong 10th edition, 397) Hence, discussing these will continually have the subject of culture connected on it. The organisational culture has to bend to the strategies of the company so as to make the human resource functions more of a strategic tool. (Chow and Liu 2007, 47) Foss and Pederson (2004, 343), in their study about multinational companies and the interaction between the headquarters and its subsidiaries exemplifies the need of proper knowledge management initiatives to maintain the edge of the organisation. They added that the ultimate ends of the company, specifically the realisation of its goals and market success is based on its capability to ensure that the entire company is able to implement effectively the most basic human resource processes like training, performance appraisal, promotion, compensation and communication.
The culture of the company is an advantage for any company provided that, it is a stable one. In the same regard, the culture of the company could essentially be used as a strategic tool if the management can steer it towards a fit with its strategic intents. Nonetheless, Cabrera and Bonache (1999, 51) indicated in their work that the culture of the organisation could only be deemed an asset if it is operating in line with the strategies of the company. Thus, an appropriate connection between the organisational culture, mission statement, and the strategies of the company should be preserved to ensure the overall success of the company.
D. Relevance of Literature
The discussion above pertaining to staff retention, staff performance and organisational development relates directly on the topic. More specifically, it tends to implicitly indicate the factors why well performing staff seek voluntary turnover from their current company. At this point, there is a clear indication on why well performing employees leave and the possible shortcomings of organisations. It appears that problems of turnover tend to originate to the mismanagement and the consequent motivational issues of the well performing workers. This then presents the relevance of the discussion above on the topic of retention of the well-performing employees in the organisation.
E. Synthesis: Applications of the Theory in the Study
Looking at the discussions above, it shows that there are several areas in literature that are considered as the critical factors that covers the retention of well-performing staff in the organisation. Among these include the satisfaction of the training needs of the employees. The awareness of the employees regarding their own professional development adds up to their decision to stay in the organisation. This is true with the other critical factor that has been noted on the discussions above, recognition. The regard of the top level management to the regular rank and file as dispensable units of the organisation serves as an actual deterrent to retention. Another factor to consider is the system of compensation practiced by the organisation. Wage policies that may suggest inequity among the employees would essentially induce turnover. And lastly, the actual culture in the workplace adds up to the entire list of critical factors in the retention of well-performing staff. Having a conducive place to work will almost always promote effectiveness and development in the operations of the company.
III. References
Bailey, J. and Palmer, G. (2005) “The Career Development of African Americans in Training and Organizational Development.” Human Resource Planning. 28(1), 11.
Brown, K., Durham, C., Kristoff, A., Kunder, L., Olian, J., and Pierce, R., (1998) “Designing Management Training and Development for Competitive Advantage: Lessons from the Best.” Human Resource Planning. 21(1), 20.
Cabrera, E., and Bonache, J. (1999) “An Expert HR System for Aligning Organizational Culture and Strategy.” Human Resource Planning. 22(1), 51.
Carrier, C. (1999) “The Training and Development Needs of Owner-Managers of Small Businesses with Export Potential.” Journal of Small Business Management. 37(4), 30.
Chow, I., Liu, S. (2007) “Business Strategy, Organizational Culture and Performance Outcomes in China’s Technology Industry.” Human Resource Planning. 30(2), 47.
Foss, N., Pedersen, T. (2004) “Organizing Knowledge Processes in the Multinational Corporation: An Introduction.” Journal of International Business Studies. 35(5), 340.
Frank, F., Finnegan, R., and Taylor, C. (2004) “The Race for Talent: Retaining and Engaging Workers in the 21st Century.” Human Resource Planning. 27(3), 12.
Gueldenzoph, L., and May, G. (2006) “The Effect of Social Style on Peer Evaluation Ratings in Project Teams.” The Journal of Business Communication. 43(1), 4.
Holtom, B., and Inderrieden, E. (2006) “Integrating the Unfolding Model and Job Embeddedness Model to Better Understand Voluntary Turnover.” Journal of Managerial Issues. 18(14), 435.
Jinabhai, D., (2005) “New Challenges for South African Development and Training-Linkages to Empirical Research.” Public Personnel Management. 34(1), 85.
Lopez, E., and Truesdell, L., (1995) “Introduction to Organizational Development.” Journal of Educational and Psychological Consultation. 6(3), 197.
Michael Armstrong (2006) “A Handbook of Human Resource Management Practice, 10th Edition” 26 Retention Strategies, 397
Neff, T. (2005) “What Successful Companies Know That Law Firms Need to Know: The Importance of Employee Motivation and Job Satisfaction to Increased Productivity and Stronger Client Relationships.” Journal of Law and Health. 17(2), 385.
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