Literature Review: Factors Influencing Turnover Intentions
The fact that employees play an instrumental role in the functioning of an organization is indisputable. Their contributions aid in the creation and sustenance of a competitive advantage. This desirable state is essential for any organization that wishes to attain the highest level of productivity and outwit competition. Currently, various issues including the dynamic work environment, globalization, and technological advancements heighten the significance of employees to all organizations (Guilding, Lamminmaki, & McManus, 2014). Specifically, they increase the degree of competitive pressures on organizations as well as institutions. In response, organizations invest a significant percentage of resources in their employee base through hiring, training, effective compensation, and so forth. The sole aim for this is to develop their staffs, retain them, and ultimately attain a competitive advantage.
Certainly, the preceding efforts are imperative for executive functioning of any organization in the current environment. They engage employees in the core activities of the organization and ensure that they focus on its development and wellbeing. Employee turnover has adverse effects on such organizations. The costs and losses that affected organizations incur due to turnover are significant. Besides demoralizing other employees, staff turnovers lead to loss of important human capital. The purpose of this literature review is to underscore factors that influence turnover intentions in modern organizations. Further, it evaluates researches that have been undertaken with respect to practical measures that organizations can take to stop and reverse this disabling trend.
Factors Influencing Turnover Intentions
Presumably, individuals resort to leaving their work places due to some level of dissatisfaction in their current professions. Nonetheless, there are other factors that contribute to turnovers in different ways. In other instances, Reiche (2008) found that employees tend to be attracted by higher pay, better career development potential, or better benefits. This is particularly so in cases where the respective employees possess more skills. They are often mostly sought after by employers from across the globe. Thus, they are lured by more attractive packages and desirable opportunities that the employers search for. The factors that influence the decisions of employees in this respect are wide and varied.
In their research, Cho, Johanson, and Guchait (2009) explore the intentions of employees to leave their professional positions. This comparative study establishes that lack of appreciation from their bosses influence their decisions. According to this study, employees commit themselves to enhancing organizational growth. They use their potential including skills, experience, and expertise to sustain organizational productivity. From a psychological point of view, they desire recognition and acknowledgement of their efforts. Besides financial benefits through effective compensation, they greatly appreciate verbal praise. Findings of the interviews indicate that even the most experienced and seasoned staff desire to be congratulated occasionally (Cho et al., 2009).
In their review of issues regarding career advancement, Nouri and Parker (2013) found out that limited opportunities for career advancement or growth cause staffs to quit their employment. In this study, a significant 68% of employees ascertained that they are misled about career development during the process of hiring. In most instances, employers do not provide them with sufficient information to influence informed decision making during this particular stage. The authors conclude that in order to address this concern, employers should provide their staffs with precise or accurate descriptions of their job positions. In addition, they need to refrain from raising false hopes for advancement and growth in their particular employments (Nouri& Parker, 2013).
The exit interviews of Senter and Martin (2007) reveal that the availability of employments that are higher paying often influence employee turnover. A study of the decision making practices of minimum wage workers with regard to quitting certain employments shows that they leave jobs for those that pay six dollars a day more (Senter& Martin, 2007). Although information in these interviews tends to be overstated, it shows that economies that are stable, and which provide better working environments attract qualified personnel and vice versa. Employers in such environments seize this opportunity to attract staffs with best skills in order to enhance productivity.
Longo and Mura (2011) highlight the role of employee intelligence in influencing turnover. The empirical review posits that employees that have sufficient skills and abilities to perform their duties effectively are more effective than their counterparts who lack such skills. If employees find the tasks and responsibilities difficult, they are more likely to leave their jobs. Likewise, those who feel that their skills are underutilized may be discouraged and choose to quit. For this reasons, the study proposes that it is vitally important for human resource officers to match employee skills accordingly.
Further, the findings of Maclntosh and Doherty (2010) affirm that inadequate training and supervision has direct implications on staff turnover. Fundamentally, staffs need direction and guidance in order for them to perform their duties efficiently and effectively. In a new environment, employees need help to learn their job specifications and familiarize themselves with the environment. Absence of guidance during such situations stirs feelings of inadequacy and helplessness. These discourage employees and prevent them from performing their duties effectively. Coupled with lack of training and ineffective induction programs, this undermines performance and enhances feelings of incompetence. Ultimately, such employees tend to leave their employments with a view of searching for better working environments.
Just Like inadequate training and supervision, Coomber and Barriball (2007) indicate that substandard facilities, equipment or tools greatly influence staff turnover trends in modern organizations. According to this study, employees perform better in an organization that has sufficient facilities than in one that lacks essentials. Vital resources like furniture, restrooms, proper lighting, and a host of safety provisions foster convenience and improve performance. This study is supported by the findings of Senter and Martin (2007) who strongly believe that availability of these provisions gives employees confidence and enhances their efficiency. This is unlike in situations where they lack essential amenities.
Theoretical Underpinning: The Social Exchange Theory
From this theoretical basis, exchange of relationships includes both social and economic dimensions. Thus, employers and staffs exchange both economic resources such as finances and socio-emotional resources like support, appreciation, gratitude, respect, and recognition. This theory is based on the notion of perceived organizational support and the ‘norm of reciprocity’ (Cho et al., 2009). These conceptions clearly explain the behaviors and attitudes of employees from a psychological point of view. Fundamentally, perceived organizational support explores the degree to which any given organization values the vital contributions that employees make on the wellbeing of the organization. In addition, the conception looks at the manner in which the employers care about the welfare of their subordinates. These important aspects define the relationship between staffs and their employers.
According to the provisions of the ‘norm of reciprocity’ conception, staffs that conceive higher levels of perceived organizational support tend to reciprocate with likeable behaviors and positive attitudes. In this respect, Nouri and Parker (2013) argue that organizations have a duty to provide their employees with a suitable working atmosphere. This enables them to develop positive attitudes and in return assume behaviors that have desirable impacts on organizational functioning and wellbeing. Ultimately, the approach is sustainable because it nurtures loyalty. Additionally, the intention to leave the organization of such employees is lower as compared to their counterparts whose perceived organizational support is low. Besides harboring negative attitudes that undermine development and productivity, they choose to quit such organizations altogether.
Addressing Employee Turnover
Certainly, organizations that wish to maintain their competitiveness should emphasize on developing and retaining a productive workforce. Staff turnover harms the productivity of both individuals and organizations and prevents them from meeting their individual goals and objectives. In addition, it makes organizations to incur unnecessary costs and stalls sustainable development. As the modern organization finds it increasingly difficult to source for staffs that have sufficient and relevant skills and attitudes, they are taking practical measures to attract as well as retain qualified personnel. This enables them to save costs and maintain productivity in a seemingly competitive corporate environment. In most instances, sustainable efforts focus on motivating employees to remain in particular environments.
In a study undertaken by Long, Ajagbe and Kowang (2014), findings ascertained that creating a positive environment in the work place contributes to staff retention. According to this research, employees cited that a positive work environment is encouraging and allows them to remain committed to the organization. Such an atmosphere gives them a chance to use their skills and abilities fully and enhances creativity. These attributes boost job satisfaction and promote positive behavior. In such environments, employees feel obligated to pursue organizational goals. Put differently, the level of employee commitment increases significantly.
In any given organization, managers and leaders at different levels influence employee turnover in different ways. Yi, Nataraajan and Gong (2011) found out that holding this facet of the organization responsible for incidences of turnover is effective in ensuring retention. Executives, human resources, line managers, and supervisors interact directly with employees at various levels of the organization. This study recommends that training managers to understand the aspects of job satisfaction and factors that influence employee turnover is useful for ensuring retention. It makes these individuals to understand and appreciate underlying complexities. Most importantly, it enables them to make informed and credible decisions regarding effective functioning. Besides training, organizations need to set turnover goals for these individuals and monitor them accordingly. Longo and Mura (2011) agree with the recommendations and findings of this research. In addition to tracking the performance of managers with respect to addressing staff turnover, the authors recommend that organizations should promote managers that commit themselves to upholding the philosophies and values of organizations.
Certainly, strong relationships within the organizations are important for creating a suitable work environment. In their review, Nouri and Parker (2013) established that enhancing connections between managers and their subordinates yields beneficial outcomes. Organizations use effective communication strategies to build and sustain bonds between employees. This is vital because it enhances trust and allows employees to work freely. In the long run, it boosts productivity and creates a rewarding work environment. In most instances, employees at the lower levels consider their counterparts at the managerial level to be representative of the organization’s goals and objectives. Establishing a supportive work environment that encourages open communication between the two factions builds trust. Reiche (2008) explains that such organizations value relationships and appreciate the contributions that they make on organizational growth.
In his insightful research, Cho et al (2009) reports that providing employees with learning opportunities is an effective approach to attaining retention. Employees that perform well have sufficient skills, knowledge, experience and expertise. They understand the scope of their duties and commit themselves to performing exemplarily at all times. In addition, they perform their duties with confidence and address both existing and emergent challenges with ease. As indicated by Guilding et al (2014), the current work environment is complex and dynamic. This requires employees to upgrade their skills constantly in order for them to survive in reap optimal outcomes from their employments.
With regard to education and training, Cho et al (2009) recommends that organizations should commit to identifying important career paths and providing developmental opportunities for their employees. In his research, he concluded that this allows respective organization to identify deficiencies and devise suitable ways to address them accordingly. In addition, they need to encourage two-way communication between staffs and their immediate supervisors regarding career advancement. This enables them to understand the employment needs of their personnel and adopt training strategies that are relevant. Further, the work environment should provide suitable career challenges for employees. In his research, Long et al (2014) asserts that competent employees should be able to address the challenges effectively. The tasks should not be intimidating and emotionally distressing. Rather, they should provide room for an effective application of one’s skills and expertise.
Also, acknowledging the efforts and contributions of employees to the wellbeing of the organization is important. In his review, Reiche (2008) found that besides financial incentives and material benefits, employees desire to be treated with appreciation and respect. He challenges managers to devise creative ways of making staffs to feel good about their employments. Additionally, creating an environment that advocates for equality at the work place enhances the perspectives of employees towards their responsibilities and the organization at large. In this respect, they consider themselves to be important members of the given institution and thus commit themselves to improving its productivity.
Modern organizations grapple the challenge of retaining competent employees. Staff turnover has negative effects on organizational functioning and development. The relative costs are expensive and prevent organizations from meeting their developmental objectives. Employees make decisions to leave organizations because of various reasons. These include lack of sufficient facilities, limited opportunities for career advancement lack of support from the management, job dissatisfaction, and limited skills amongst others. From a theoretical viewpoint, employees reciprocate the efforts that their employers make. Thus, organizations that provide an ideal work environment have higher retention rates than their counterparts that offer a demeaning work environment. The literature review underscores various approaches that organizations can assume to address problems pertaining to employee turnover. Besides providing career advancement opportunities, employers need to offer training sessions and strengthen employee relations amongst various other strategies.
Cho, S., Johanson, M. &Guchait, P. (2009).Employees intent to leave: A comparison of determinants of intent to leave versus intent to stay. International Journal of Hospitality Management, 28 (3), 374-381.
Coomber, B. &Barriball, L. (2007). Impact of job satisfaction components on intent to leave and turnover for hospital based nurses: A review of the research literature. International Journal of Nursing Studies, 45 (10), 1447-1459.
Guilding, C, Lamminmaki, D. & McManus, L. (2014). Staff turnover costs: In search of accountability. International Journal of Hospitality Management, 36, 231-243.
Long, C., Ajagbe, M. &Kowang, T. (2014).Addressing the issues on employee turnover intention in the perspective of HRM practices in SME.Procedia-Social and Behavioral Sciences, 129 , 99-104.
Longo, M. & Mura, M. (2011).The effect of intellectual capital on employees’ satisfaction and retention, Procedia- Social and Behavioral Sciences, 97 (6), 201-208.
Maclntosh, E. & Doherty, A. (2010).The influence of organizational culture on job satisfaction and intention to leave.Sport Management Review, 13 (2), 106-117)
Nouri, H. & Parker, R. (2013).Career growth opportunities and employee turnover intentions in public accounting firms.The British Accounting Review, 45 (2), 138-148.
Reiche, B. (2008). The configuration of employee retention practices in multinational corporations’ foreign subsidiaries. International Business Review, 17 (6), 676-687.
Senter, J. & Martin, J. (2007).Factors affecting the turnover of different groups of part time workers.Journal of Vocational Behavior, 71 (1), 45-68.
Yi, Y., Nataraajan, R. & Gong, T. (2011).Customer participation and citizenship behavioral influences on employee performance, satisfaction, commitment, and turnover intention.Journal of Business Research, 64 (1), 87-95.