Background of Study
The purpose of undertaking a research is to formulate a recruitment policy to reduce staff turnover. Most of the companies intend to provide better training and job development scopes, service uniformity, discount, increment, and other welfare offers for internal staff, outpatient, leave, and inpatient media exposure, reward, compensation, and sufficient bonus arrangement. In spite of those employment facilities, the management of the companies is not experiencing complete satisfaction considering the staff turnover rate. In addition, staff turnover is increasing despite a good employment environment, motivation, communication, and other facilities. As a result, the researcher of this paper has identified the key problems and decided to prepare a recruitment strategy to reduce staff turnover.
Significance of the study
The significance of the study is explore and investigate with the staff turnover of ABC, an INGO of Sri Lanka and identify its present condition and presents a recruitment policy to reduce staff turnover. The staff turnover in the INGO sector is very high in the modern service, which is deeply concerned with lack of job satisfaction, large of opportunity alternative jobs, and other connecting factors affecting the workplace environment. The result of this study would keep its major contribution to the global nongovernmental organisation with a new recruitment policy, which would be capable to decrease employee’s turnover of INGOs. In addition, the employees of ABC would get a superior direction to their selection process.
By implementing suggestive recruitment, policy will increase job satisfaction of the staffs of ABC and diminish job dissatisfaction of the staffs and from this implication, the management of ABC would be able to realise the benefits of this research. The staff turnover and skiving possibly will concentrate by decreasing the cost of recruitment. The said recruitment policy would be able preserve and develop the process without any debate and to some extend it will guide to boost pubic awareness as well as community support. It is clear that the strapping recruitment policy would attract more employees that are new and will get elevated candidates for advanced selection.
In addition, from the outcomes of this research staff members of ABC would develop awareness to the factors those motivate the level of employee’s job satisfaction while the management of ABC would appreciate to removing the factors concerned with dissatisfaction. At the end of the day the outcome of this research would facilitate the staff members of ABC to compare their existing height of job satisfactions along with their co-workers and the managers can measure the features of jobs, reason of unhappiness and then motivate themselves towards approving alternative to contentment.
Statement of the problem
Frontera (2007, pp. 6-47) pointed out two that the study of various INGOs working in the developing countries demonstrated the vital issues seriously influence the organisational performance of international NGOs working for humanities and the issues are staff performance along with staff retention. It is also mentioned from different social segment that the INGOs have serious lacking to adequately motivate their staffs and volunteers to carry out the required level of encouragement that create moral obligation of the staffs to stay within the organisation. Such lacing of motivation concerned with a number of reasons linked with INGO operation and the socio economic factors of the working countries where staffs do not bother to leaving current position showing cause of lower pay. The escalations of the INGOs in the less developed countries urge for keen attention of the management to cheering their staffs for better performance while the recent trend demonstrate the rising number of local employees joining in the INGOs in the less developed countries but there is lack of persistent staff migration in oversees, upgrading activities, and career aspirations.
The operation of ABC in the less developed countries are facing great challenge to move up the motivation of its employees and volunteers to carry out significant contribution to the working areas without any staff turnover. ABC is working in Sri Lankan facing different dilemmas of staff turnover connecting its financial resources, with clear scenario that only fiscal incentives are not good enough to motivating its staffs but necessitated non-financial incentives to accelerate their motivation, ABC is thus under emergence to scrutinize how to encourage and retain staff with lower budgets.
McManus (2003) stated that recruitment process is a complicated procedure, as a manager has to advertise for recruitment, selected candidates by considering their merits, complete interview process, and finally find out the competent person who fulfils all the requirements. He addressed that these selected employees can leave the organisation any time though the entire selection procedure involved high cost, time, and efforts of the management. He further added that the management has to repeat the whole job selection procedure due to leave of selected employees. In this context, management should recruit such a person who will work for a long-time for the organisation; therefore, they need a proper recruitment policy to reduce turnover.
Research questions of the study
This thesis paper is designed to formulate a recruitment policy to reduce staff turnover. To highly focus on the objective, the paper would respond to the following research questions, the answer to this question would enable the companies to develop our understanding of the context in which recruitment strategy affecting the staff turnover and the four research areas are
- Why staffs leave jobs or switch to another?
- What is the Impact of staff turnover?
- How the organisation can retain staffs?
- Formulating a Recruitment Policy to avoid staff turnover.
The research on above questions will help to discuss the topic as these issues are closely interrelated with recruitment policy and staff turnover. Moreover, all of these matters will be measured under positive considerations along with theoretical background.
Objectives of the Study
First of all this study would engage its effort to scrutinise there relevant literature review concerning the staff turnover, it influence the organisation and the rote to overcoming staff turnover which as presented in chapter three. Another objective of this study is to conduct a survey with the employees of ABC, which ahs presented in chapter four. In addition, this research would also formulate some recommendations those would be helpful for INDOS to reduce staff turnover in their organisational practice. With these three objectives, this study has engaged to find out the answer of the question why staffs leave jobs and what is the impact of staff turnover, how to retain them connecting their job satisfaction. There are enough research concentrated either to analysing the recruitment, retention or collective staff turnover, but there is no integrated research agenda has yet get higher with implications of recruitment policy on staff turnover. Thus the ultimate objective of this study is to scrutinise the fundamental issues those make a deep insight upon such managerial process of organisation, and realising the necessity to reform some of those sectors with a modified versioning by human resource management, change management as well as organisational behaviour and so on.
The International Non-Governmental Organisations have deliberately focused on their advocacy role, asserting about the motivational values, principles, and morals presuming the state domination over legitimate coercive power, whilst, these INGOs increasingly execute policies where state power is weak or non-existent, and their commitment to their mission frequently causes action that violates their proper role. In most cases, it has been alarming to observe that despite of their practice of moral values, dilemmas and discriminations fill up their own internal human resource management practices. Recent surveys suggest that these have caused the organisations to suffer from rising rate of staff turnover. This assessment examines ways in which staff turnover can be diminished and how the proposed organisation could respond to bring about material changes in its employee retention oriented recruitment policy.
Explanation to the diagnosis
The INGOs have played a major role in working for the sustainable development at the international level, in fact, the campaigning groups have been key drivers of inter-governmental negotiations, ranging from regulation of harmful wastes to a global ban on land mines and the abolition of slavery; however, INGOs are not only focusing on governments and inter-governmental processes. Together with reformation of situation from a range of public-utility and dogmatic actions, INGOs started to replace their places of interest on influential businesses that could compete the whole country in terms of their revenues and assets; aided by advances in information and communications technology, INGOs will help businesses to focus on the social and environmental externalities of their activities. Such diversified ranges of activities have made the organisations to concentrate more on carrying out their regular operation with a minimal amount of focus on the needs and requirement of their personnel. These factors have driven the employees to switch their jobs for better opportunities. Nevertheless, it is important to note that the formulation of a good recruitment policy in the organisations could sort out the proposed problem.
Rationale of this Study:
The researchers who research on human resources management tried to investigate the question why staffs leave jobs and what is the Impact of staff turnover, and the researchers have concentrated either to analysing the recruitment, retention or aggregate staff turnover, but no integrated research agenda has yet risen with implications of recruitment policy on staff turnover. As a result, the fundamental issue for arranging this study is to make a deep insight upon such managerial process of companies, and realizing the necessity to reform some of those sectors with a modified versioning by human resource management, change management, organizational behaviour and so on.
Statement of the Hypothesis
Buzzard and Webb (2004) presented the structural overview of International NGOs staff turnover connecting with their local partnership by assessing the factors those manipulate their joint venture initiatives for the betterment of the local communities keeping collective efforts on staff exchange option as well as learning network in cost efficient manner. Due to the communication with the grass-roots level, capabilities to leverage funds and grants to imprecate their projects, the literature of staff turnover keeps attention to identifying the strengthens of organisational capabilities, efficiency to design effectual recruitment policy and implement it along with evaluation of growth indicators in accordance with the organisational mission. To set up standard of recruitment policy for INGO, it is considered that there are some fundamental elements to organising internal management systems integrating with capacity building, improving technical expertise, and networking with the communities.
This researcher has aimed to scrutinising the idea of staff turnover by effectively replicating with strapping recruitment policy and factors among the present organisation to assess the implication and appreciative organisational changes that caused from the voluntary turnovers and what would be the sustainable recruitment policy to avoid high level of staff turnover of INGOs. To do so, this researcher has identified two hypotheses demonstrated as follows
- Hypothesis-1: When recruitment policies are good, the turnover will reduce
- Hypothesis-2: When recruitment policies are not in place, turnover is increased
Lee, et al. (1996) has presented his voluntary turnover model and gained tremendous support to analysing shocks that keep vital role to assessing the employee’s decisions to willingly leave the organisation and the impact of such decision in the overall performance. This researcher has aimed to examining this idea by effectively replicating the factors among the present organisation to assess the implication and appreciative organisational changes that caused from the voluntary turnovers and what would be the sustainable recruitment policy to avoid high level of staff turnover. To do this researcher has identified four hypotheses as follows-
- Hypothesis-1: The shocks from management through conflicting rank and file, rude decision and blaming trend would feature in a remarkable number of cases of turnover ;
- Hypothesis-2: The Shocks would be catalyst with increasing workload, stressful duties and lower organisational practices and extremely influential in terms of the concluding decision to quit the job
- Hypothesis – 3: A recruitment policy with performance measures, healthy compensation package, union rights and innovative skills can reduce high rate of employee turnover
- Hypothesis 4: The shocks of staff turnover will be more avoidable through a recruitment policy complying with changing workforce culture, fair promotion and reword terms, fair compensation, negotiating opportunity for wage.
Limitation and scope of the study
During the research, this researcher has faced many dilemmas connecting to carry out a fruitful outcome in order to finish this thesis paper. At first instance there were conceptual gap with the original instruction for this research project provided by the academia. It was very time consuming issue to identifying the research gap, which necessitated to spending several sleepless nights for the researcher with hard working. The limitation of deadline is another constrain which were very complicated to manage and administer. As the researcher has no previous experience in conducting such kind of research, lack of cooperation from the field survey has created most dilemmas to collect and data while shortage of the relevant secondary data was one of the main challenges to co-ordinate the research. Moreover, some resourceful journal article is available in web but the price those reports were not reasonable for the researcher while the limited word to complete the research also generated enough constrain. There was no research grant and the budget for the primary data collection or field survey was limited in addition another problem was the low response rate because of respondents were either busy with their own job or reluctant give response.
This study has well deliberated under the keen supervision of the academia that has furnished an elevated opportunity to utilise most resourceful books and journal and this researcher has considered it as the prime scope to the research. The selected topic is a sole one, which gives the opportunity to research on various aspects like job selection process, retention, and staff turnover. Due to staff turnover has deeply connected with job satisfaction, workplace environment, diversity management, and behaviour of employers, this paper has scope to correlate this issue with the topic and it has opportunity to compare the data of ABC with some other INGOs working in the same field, like Save the Children, CARE, and World Vision. The researcher has intended to fill in the gap of the outcomes of other research documents while there is potential scope to address the recruitment policy of foreign companies as they pay more than local companies do. Most remarkably, this research has enough scope to conduct a real field study to know about the attitude of employees regarding these issues, and the researcher would prepare a questionnaire for field survey. In addition, this study has the opportunity to identify effective methods and practices used by employers to recognize skills gaps and their organisations and it has scope to recognize the effectiveness of different recruitment methods and practices in addressing skills requirements in the operation of INGOs in less developed countries.
The researcher has faced following problems in order to finish this thesis paper
- the original instruction for this research project is complicated to ménage within short deadline;
- the word limit was not sufficient to cover all the issues related with staff turnover;
- Shortage of the relevant secondary data was one of the main challenge to co-ordinate the research;
- Lack of experience in conducting such kind of research;
- Moreover, some resourceful journal article is available in web but the price those reports was not reasonable for the researcher;
- The budget for the primary data collection or field survey was limited;
- Another problem was the low response rate because of respondents were either busy with their own job or reluctant give response.
The identified scopes of the study is as follows
- This is an sole topic, , which gives the opportunity to research on various aspects like job selection process, retention, and staff turnover;
- As staff turnover is interrelated with job satisfaction, workplace environment, diversity management, and behaviour of employers, this paper has scope to correlate this issue with the topic;
- It has opportunity to compare the data of ABC INGO with two other NGOs, like Save the Children, CARE and World Vision;
- The researcher is intend to fill in the gap of the outcomes of other research documents;
- The researcher has potential scope to address the recruitment policy of foreign companies as they pay more than local companies;
- Most significantly, this research has enough scope to conduct a real research to know about the attitude of employees regarding these issues, and the researcher would prepare a questionnaire for field survey;
- This paper sought to identify effective methods and practices used by employers to recognize skills gaps and their organisations;
- Finally, it has scope to recognize the effectiveness of different recruitment methods and practices in addressing skills requirements.
The methodology of this dissertation makes it available that the justification on how the current research on the recruitment policy and strategies of retaining employees would integrate to reduce staff turnover for ABC and the paper would argue for qualitative research. Malhotra (2006, p. 67) demonstrates the difference between quantitative and qualitative research to collect and analysis the data in different way, for example, qualitative research methods may be direct (focus group interviews with ABC employees) and indirect. Therefore, this dissertation will explain the data collection processes such as direct interviews of the employees and managers of ABC, significance the primary and secondary sources to reach in the ultimate objectives of this study. Besides the data collection, limitation on data collection, reliability, and validity of the interviews would also be illustrated for further study. The derail methodology has presented in the Chapter 3.
Relevant Literature Review
Conceptual Framework of the Study
Definition of Recruitment, Turnover, and Retention
Recruitment is the foremost step in the selection process of the organisations that consists of an activity focussed to attain suitable HR with qualifications and proficiencies that go with the requirements and tasks of the apposite vacancies in the organisation (Vale, 2010, p.7). Recruitment implicates the utilization of organizational practices to influence the number and types of individuals eager to apply for job vacancies; it focuses on the internal employee supplies (engaging staffs previously employed by the organization) or the external employee supplies (engaging applicants from outside the organization); a organisation recruits internal candidates through internal job postings, words-of-mouth, internship programs, etc.
Staff turnover is a ratio comparison of the number of employees that a organisation should replace in a given time period to the average number of total employees; it is important to note that for most organisations, staff turnover remains as an agonizing experience for which organisations try to reduce rate of staff turnover by means of different strategic approaches. Loquercio (2006, p.4) argued that numerous aspects are present in an organisation that can influence staff turnover rate of a organisation, which could staunch from either the employer or the employees; these aspects, for example, could be wages structures, organisation benefits, employee attendance, and job performance. Turnover can be either voluntary or involuntary; the following figure outlines the differentiations between the categories of turnover:
Recent studies suggest that attracting and preserving the best intellects is the main policy through which a organisation can stand to be financially strong, but, the impact of increasing labour turnover is one of the most alarming factor that impose direct or indirect costs over organisations increasing the organisation’s overall operating costs and lowering the profit margins. Turnover levels usually vary between industries; the highest levels have typically found in retailing, hotels, catering, leisure-centres, call-centres, and among other low paid private sector service groups; moreover, turnover levels also vary from region to region, for example, the highest rates has found where unemployment is lowest and where it is uncomplicated for people to secure enviable alternative employment. According to Sunderji (2004, p.3) turnover rates have diminished in past few years during adverse economic conditions when the redundancies increased by a higher rate; for instance, at 2009, in many EU based industries, less number of employers made more employees redundant whereas in 2008, the same number of employer made comparatively lower redundancies.
Sheridan (1992, p.5) suggested that retention allows diminution of employee turnover, which assists the minimisation of unexpected expenses and pessimistic influence of unnecessary and unforeseen resignations; this minimisation of turnover can be through staff consultation, succession planning, performance management, providing incentives for staff, and by many other methods. Usually, an organisation’s corporate culture, values, and morals use to have an essential influence on the rates of employee turnover, as more often the reason behind resignations is the organisation’s discriminations in terms of colour, gender, religion, and ethnic background. Therefore, actions such as addressing the internal workplace environment can help the organisation to concentrate on retention. An employee’s job performance will radically interrelate with organisation’s cultural values in influencing retention rates; the distinction between the retention rates of efficient or inefficient workers will fluctuate considerably depending on the corporate ethics of an organisation.
Why They Are Important
Emphasizing in recruitment processes and hiring better recruiters is essential for INGOs because attracting talents are the gateway of organisational success; in addition, it is also important for the organisations to do some employment branding in order to gain the reputation of being a good employer inducing the top talents to join the officialdom enhancing the workforce quality aggregately. Vale (2010, p.7) stated that the importance of recruitment, turnover, and retention varies in different international organisations. However, for majority of organisations, these three factors remain as the most significant managerial practices and challenges to overcome for increasing operational efficiency and profit margins. The reason why organisations put so much importance in reducing employee turnover lies behind the fact that there are numerous costs involved with increasing rate of turnover; these costs can be both direct and indirect (CIPD, 2007, p.14). It include costs of administrating resignation, recruitment, selection, costs of covering the period in which there is a vacancy, stimulation training for new worker, costs associated with departure, for example, medicals, visas, consultation, handover or flight tickets, impacts of role-overload and open vacancies on staff’s confidence, initial incompetence and inaccuracies, repeated staff-rotation, loss of skill caused by excessive workloads, etc. The following figure shows the possible consequences that can flow from staff turnover and adversely affect the international non-governmental organisations by different ways:
However, in some cases, staff turnover can be profitable for organisations; this occurs whenever a more effective employee replaces a poor performer, or when someone’s retirement allows promotion or integration of ‘fresh-blood’; consequently, economists suggests this as a necessary-component for efficient labour market because it ensures increased productivity by ensuring better matches between employers and employees (Vale, 2010, p.7). This indicates the fact that retention of employees is only important under a couple of circumstances; in fact, it is not essential for an INGO to retain all its workers, rather, what important is for the organisations to identify the most prospective ones in terms of productivity (People In Aid, 2008, p.8). Initially, the organisations need to recognize which placements, profiles, and qualifications are most vital and where turnover will be most detrimental for them; next, they can focus on reducing the turnover for these selected categories; while doing so, the INGOs need to keep in mind that retaining staffs who have lost motivation is disadvantageous for their regular working practices.
Different INGOs have different strategic approaches to the formulation of their respective recruitment processes; however, despite of some specific dissimilarity, the basic recruiting structure remains the same:
- Role/job analysis: it is the method of figuring out what are the needs of the post and what qualifications, knowledge and expertise are required by the job; it is more than merely drawing up a list of tasks or responsibilities and a crucial step in the recruitment process;
- Role profiling/job description writing: this is a procedure that assembles and illustrates all the identifications gained from the job analysis; it significant that the job description is as precise, instructive and as pragmatic as possible so that it is not ambiguous for applicants;
- Using competencies: it includes those distinctive conducts that an organising body has accredited as imperative for its personnel to be more efficient in conveying its aims and promoting a prolific, specialized, and effectual work-environment, as well as promoting effective ways of working, interrelated with organisational values;
- Attraction: through this process the HR panel tries to draw the attention of those applicants who are the most suitable and competent for the job;
- Internal recruitment: this includes placements, replacements, promotion, demotion, and exchange of posts of the staffs already working with the organisation;
- External recruitment: this is when a panel recruits employee from outside of the business through processes like advertisements;
- Selection: under this process, the HR panel selects the applicants; in most INGOs the selection process are transparent, cost-effective, and impartial;
- Appointing candidates: in this step, the panel finally appoints the applicants to work with the organisation.
A properly carried out recruitment process, in addition, helps an organisation in the retention process of the employees. The figure below outlines how an organisation can achieve improved retention through enhanced professional development strategies, competency driven selection, etc:
Moreover, in order to retain the employees, it is quite essential for an INGO to follow a clearly defined, appropriate, timesaving, and contemporary approach in adaptation of its retention process. Figure 5 shows a gist of the retention process in INGOs:
It is important to note that whilst retaining the employees, it is essential for the organisation to first identify that what factors persuades the staff to leave their job. The next step is for the entire HR department to work jointly with the aim to mitigate those factors in order to create the organisation a more easy-going place where it would be a pleasure for the employees to work for mutual benefits. In the identification process of the factors, the managers will distinguish all those problems of the work environment that are the key concern to increase turnover; in most organisation, there are some potential factors, generally known and the push and pull factors. Figure 6 demonstrate a brief account of the potential push and pull factors that a large number of INGOs face more often.
Verlander and Evans (2007, p.5) states that subsequently, organisations undertake several strategies that would mitigate all the push and pull factors identified. In so doing, the management focuses on improvement of working conditions, providing workers with better pay, remuneration, employment benefits, and holiday packages, development of employee and employer relationship, removing discriminations or racial practices, building job responsive organisational culture, etc. Some of the mitigation strategies has outlined in the following figure:
Moreover, good HR practices are the basis of enhancing retention and staff engagement; on the other hand, the employer’s positive attitude toward workers is essential for reducing turnover as well (Vareta, 2010, p.3). In context, for constructing a good retention process, it is also vital that organisations well-manage the consequences of turnover through ensuring continuous programmes, retaining organisational memory, etc:
Staff turnover is a significant area for a business organization due to high administrative cost burden as well as reduction of productivity. Staff or employee turnover has occurred through various way and most of the cases it might be either voluntary or involuntary. For the voluntary case, employee turnover might be functional or dysfunctional and the dysfunctional turnover has required dealing with both avoidable and unavoidable functions of the organisation. Alternatively, stress or excessive workload is another key reason to leave job or to switch suitable one. In the following diagram turnover modes has plotted in order.
Reasons to Leave Job
Three boarder forces has motivated employee turnover and these have included organizational culture, leadership quality or managerial skills and operational strategies of the firm. Besides these there have several significant aspects, which have motivated to leave current workplace. Brief description of these has pointed bellow. (SIGMA, 2007)
- Financial attributes: attractive remuneration package is one of the key dominating factors to join in an organization. A reputed research report has surveyed that 50% job holder has leave or switch to another for better payment structure over and above flexible working terms and condition.
- Organizational performance quality: poor organizational performance and economic downturn have stimulated an employee to find new occupation.
- Organizational culture: employee turnover trend and high turnover rate have correlated with the dynamics of organizational culture. An organizational culture has included employee rewarding, leadership quality; loyalty and commitment of the employer and employee, shared vision program and so on. These forces have represented job satisfaction standard. An inverse atmosphere of these dynamics has magnified employee turnover rate.
- Job specification and job description: well define job specification and job description has made easier mode to develop effectiveness and efficiencies of an employee. Conversely, these two factions have also symbolized significance of the job status. Lack of this circumstances have encouraged staff turnover.
- Excessive workload/stress: several research surveys has evaluated that many candidate has not any idea about the job requirement before accept the job offer. Thus, excessive workload and stress push the worker to leave. Conversely, disillusioned working atmosphere and unrealistic demand of the employer has also a major reason to quit from workplace.
- Demographic conditions: demographic and biographical circumstances of an employee have significant role in this case. Alternatively, employee’s standard of living and employment history (if any) have considerably considered during competent candidate screening. Moreover, candidate’s profile has also empirically verified or investigated to justify his/her apparent legitimacy over and above fairness during working environment. Negative result of this verification has tended towards employee turnover.
- Behavioural incidents: employee turnover rates has been manipulated and magnified due to several personal over and above mannerism-oriented dynamics. Personal forces have induced by arising crisis in the family atmosphere, employee’s tendency to learn modern professional skills, get spontaneous job opportunity and so on. On the other hand, mannerism cantered forces have required to deal with the employee job performance appraisal attributes and included anti-productive acts. For instance, loafing, tendency to absent in workplace frequently, evaporation or stealing, lack of physical ability to continue the job workloads/stress, consciously damage organisation’s office materials or production equipments. During screening of employees, these attributes have to enquire properly so that the organisation would be reduced staff turnover rates.
All of the rationale have discussed above on employee turnover would be produce better outcome if these have categorized into suitable strategic department like environmental analysis including both external and internal environmental forces, organizational culture, proper execution of HRM and practice of sharing theory to distribute workloads among personnel. Besides employee turnover, theses controllable dynamics has also significantly impact on administrative cost reduction of the organization (Loquercio, et al., 2006).
The Impact of Staff Turnover
Usually, staff or labour turnover has symbolized the number of employees who have leaved their job or switch to another organization. Alternatively, staff turnover rate has expressed the ratio between annual average number of employees who leave their job and number of employees who have been recruited in an organization during a year. In all type of organization, it has regarded that staff turnover as a significant aspect of their HRM1 department since it has strongly impact on bottom-line manger performance as well as on the business firm. For example, in the OECD region2 annually 10 to 15 percent employees have changed their jobs and in the UK staff turnover rate has around 10%. Key impact of the staff turnover has maximized organisation’s cost burden at several aspects such as recruitment costs, training costs, wages, and marginal cost of production. Hypothetically, labour or staff turnover impact has properly described through “the Efficiency Wage Model of Solap”. Moreover, this theoretical justification has also talk about the cost minimizing modes to overcome staff turnover affects (Browna, et al., 2008).
Affected Areas of Staff Turnover
According to aforesaid discussion, staff turnover has the most challenging section of an organization. Affected areas of staff turnover have suffered harsh cost burden over and above managing intractable workforce challenges. Conversely, in order to overcome these difficulties bottom level mangers, HRM professionals, and industrial psychology councillor have assigned to pay considerable attention. Cost of the staff turnover yield has relatively high volume and this high cost has noticeably reduced firm’s profitability ratio. Additionally, many organizations have faced threat to survive in the marketplace. Results or impact of the staff turnover has reflected on several areas of the organization where cost burden has magnified. Staff turnover affected areas have illustrated below (SIGMA, 2007).
- Firstly, further recruitment procedure has increased administrative expenditures like advertisement for the vacant posts, screening and interviewing candidates, charges for the selection services, security confirmation, referencing, and cost of medical tests.
- Cost increase during organizational hiring.
- Cost of marginal production before re-recruitment.
- Low production volume during provisional period of replacing new staff
- Low production volume during provisional period whilst the superior executives have engaged to mentor the new comers to develop their professional skills
- Both on-job and off-job training of the new employees over and above training supervisor has required marginal administrative expenditure.
- Voluntary termination costs have reduced production efficiencies of an employee.
- Maintaining confidential business strategies and skill development for more competent during market has required supplementary costs in few cases.
- Both voluntary and involuntary termination has engaged with supplementary costs due to maintaining public relations to promote organisation’s positive image.
- Finally, according to the labour compliance regulation, job loss insurance costs have enlarged organisation’s administrative expenses.
For more clarification, in following figure staff turnover affected areas have highlighted.
Steps to Measuring Staff Turnover Costs
Utilizing following five sequential steps a business organization can evaluate their staff turnover costs after end of the year (Nierman, 2001).
- Step 1: Calculate annual wage of employee by multiplying employee’s annual salary and 25% average turnover costs
- Step 2: Yet again calculate annual wage by multiplying employee’s annual salary by 30% common benefits and the amount has again multiply by 25% average turnover costs
- Step 3: Calculate sum of per staff turnover costs by adding amount of step 1 and 2.
- Step 4: List number of staffs who have turned over during a year.
- Step 5: Multiply sum of per staff turnover costs by number of staff turnover and thus the organisation can evaluate their actual cost of employee turnover.
Assume PQR is a humanitarian firm where annual salary of an employee is $45,000. Yearly 15 employees have switch from this organisation. Considering this information and utilizing above method, aggregate turnover cost of the PQR has calculated bellow.
- Step 1: annual wage = ($45,000 x 25%) = $11,250
- Step 2: annual wage = ($45,000 x 30% x 25%) = $3,375
- Step 3: total cost of turnover per employee = ($11,250 + $3,375) = $14,625
- Step 4: number of employees who have turned over during a year = 15
- Step 5: total cost of turnover of PQR = ($14,625 x 15) = $21, 9375
How The Organisation Can Retain Staffs:
The term employee retention has reflected the steps to design and hold efficient and effective employees after their recruitment. Conversely, employee separation is the term of process that has worked for terminating an employee fairly, legitimately over and above efficiently. As stated by the HRM terms and condition there have several key employee retention policies. They are pointed bellow (Phillips & Adele, 2003).
- Career transition scope
- Skill development training
- Fair performance appraisal
- Wage and remuneration management
- Employee reimbursement programs
Employee Retention Strategies
Several research report has appraised that employee turnover has been 1.5 times costly than retention of the efficient employees. In case of reducing staff turnover, firstly it has better to pay attention on employee wage and remuneration management package as well as on compensation attributes. Alternatively, if the working atmosphere or the organizational culture were enjoyable and satisfying employee’s needs and demand would be more effective to retain an efficient employee. In short, job satisfaction has the immense power to retain effective and efficient employees in an organization. In following discussion key strategies to avoid staff turnover has briefly discussed. (Fox, 2010)
Scope of Career Transition
Offering flexible terms and condition of a job has strongly works for the staff retention. More specifically, scope of shifting another and also scope to back in the previous place has encouraged newly join employees to retain and provide better performances over and above continuously develop their professional skills.
Skill Development Training
Handsome number of employees has eagerly waiting for learning modern professional skills. In this case, organisation can offer their personnel both on-job and off-job training. Most of the cases on job training are rather effective to develop employee’s professional skills. These training have not only impact on employee’s working skill improvement but also positively contact on their behavioural aspects. (Chapter 7)
Fair Performance Appraisal
Fair performance appraisal/evaluation has significantly focused on a set of issues where both organisation and the employee’s own career success have directly involved. Significance of the performance appraisal has occupied following state of affairs. There have lots of performance appraisal methods those have applied in the renowned organization. Among them rating scale, checklist and behaviourally anchored technique has widely used in the international business organization. (Anthony, et al., 1993)
- Transparency and accountability of both the employee and employer.
- Career planning of the employees as well as target vision of the firm.
- Provide training and development aid whether required
- Increase of payment of the employees or in brief rewarding employees based on their progress.
- Decide whether promotion, demotion, layoff, termination, and separation would be applicable.
- Arrange orientation as well as placement program to brief about the organization.
- Amendment of HRM strategies and policies whether required.
Managing Wage and Remuneration
Practice of fair payment structure according to the designation of the employee is most accommodating tool to retain and grow employees. During employment of a staff, the organisation has to be cognisant on goals and objectives of the payment structure. In brief, wages and salary should be design on the basis of duties and responsibilities of an employee. Major aim of the payment package has to discover through proper quality, employee retention, controlling cost and increase productivity, clear understanding of the feasibilities, increase job satisfaction, maintenance of work life standard, provide first aid facilities along with stress free working atmosphere and balance between organisational strategy and individual interest (Fox, 2010).
Compensation is the fringe benefit of an employee paid by his/her employer. Compensation might be paid directly or indirectly. Indirect compensation has included incentive, get organisation shares, performance based rewarding, indispensable payment (wage/salary) and compensation management. Where as the direct compensation has involved in health and hygiene facilities, tax free support, passport, safety and security and so on (Anthony, et al., 1993).
Recruitment Policy to Avoid Staff Turnover:
Fundamental difference between employee retention and recruitment is that the retention has assign to defend unwanted turnover where as recruitment has required to appoint new worker. This part of the paper has entailed to draw recruitment policies which would be proficient to prevent unwanted staff turnover or in another term capable to retain efficient employees. Before pointed out major recruitment policies, it has to be quoted that the strategies to reduce employee turnover have enough skill to provide sufficient support to draw policy of employee recruitment (Sinnott, 2002).
Following are the sequential levels of employee recruitment policies those have able smartly handle employee turnover (Nierman, 2001).
Scope of Recruitment Policy
The scope of the employee recruitment policies has to significantly consider several key aspects like to what extend policies of the firm would be applicable on employees, indisputably pointed about the considerations of the recruitment management, legislative application for specific duties and responsibilities of a position and procedure of the recruitment policies itself have legislative requirements (if any) (Anon, 2010).
Purpose of the Recruitment Policy
an effective recruitment as well as selection steps has committed to a few of basic issues of a firm that have included fair, transparent and systematic recruitment application. Additionally, through this mode, an organization can successfully promote equal job opportunity scope where women, minor and disables would be fairly treated. Purpose of the recruitment policy has also been stated that final selection of the firm has chosen best candidate where competency, skills and previous experience of the candidate has fairly judged. Besides equal opportunity the firm has also be aware of correlated employment legislation like Employment Act 1964, Disability Act, Minority Act and so on and these regulation would be represent organisation’s mission, vision, goal, ethics and values, market competition and profitability ratios (Careersatifds, 2010).
Formulation of the Recruitment Policy
Following are the crucial recruitment policies of a business organization (Wisconsin, 2001)
- Equal opportunity: scope of equal opportunity in the working atmosphere has aimed to protect discrimination/unfairness. Bias issues in the case has included racism, colour, sexual harassment/any type of sexual assault, sensitive religious aspects, minority treatment, Vietnam-era, disability, age of the competent candidate, creed and so on.
- Confidentiality: During recruitment process, HRM department of an organization has to be committed to protecting privacy of the candidate’s personal information. It has well known that recruitment and selection procedure has required flowing throughout a sequential course of action. On the other hand, confidentiality has also assigned to justify applicant’s previous professional experience (if any) and reference before final selection.
- Scope of collective bargaining and compensation: collective bargaining option has clarified all of the entire terms and conditions, which would be made easier for the applicant to join in an organization.
- Recruitment of relatives: In few organizations there have scope or limited number of vacancies for the employment of relatives and this consideration has treated on spouse, children, brother/sister, siblings, in-laws partners/present sexual partners, join households/cohabit or any other friendly relative.
Recruitment has organized the ways to meet organizational vision, mission goals, and policies. A recruitment procedure should clarity about the vacant position’s job title, duties and responsibilities, selection procedure, referencing, qualification and other correlated factors. Additionally, both employer and employees have to acknowledge of constitutional direction of HRM (Anon, 2010).
Employee Screening and Selection Process
The primarily advertisement by print or electronic media, competent employee screening has effectively started. Where as selection of employees would be standardize by written and interviewing of the candidates. Most significantly it has to be aware of following two aspects (Careersatifds, 2010).
- Validity: validity of employee recruitment has assign to connect between employee’s job test outcome and the practical performance during the provisional period and this judgment has to be on individual performance basis.
- Reliability: the term reliability has conduct with the consistency of the performance evaluation and this justification might be either empirical or by rational.
The cardinal issue of this chapter is to present how the preferred research methodology will go with the foremost objective of the thesis and how it will finish throughout the paper to formulate the paper, the researcher will follow Malhotra’s six major steps, as it would be easier to proceed with this approach.
Arguments for and against
Stafsudd and Collin (1999) identified that the recruitment policy obviously influence the recruitment process, with strapping recruitment policy aimed to reduce the staff turnover while the control systems would keep major impact upon the selection process by determining the resolution assumptions depending on which the ultimate recruitment decision would formulate. Adopting a good recruitment policy would exemplify by removing inconsistency of the existing processes where recruitment policy involving other assumptions connecting recruitment decision that direct the actions influencing organisation behaviour as well as recruitment process aimed to reduce staff turnover. Moreover, a recruitment policy with the objective to reducing staff turnover would be organised with cost effective and time saving manner with exact guidance for training and motivation with would ultimately contribute the organisation to boot its revenue generation.
On the other hand, a good recruitment policy has some controlling over the organisational resources next to settle on which resource would be preserved, explored maintained or neglected, only the managers are not most significant resources of an organisation but they control organisational resources while the managers are also the product of a selection and recruitment process. A recruitment policy both for internal and external engagement of the employees can add elevated values to the staffs by internal promotion, outwardly recruiting and organisational decision-making which may generate a retention guidance to lessen staff turnover. In addition the organisational recent tend of recruitment policy curves towards internal recruitment would essentially correspond with the assumption that for good recruitment policy would attract internal candidates that would ultimately prove that it is a fruitful approach and best recruitment decision to sane time and money of the organisation (Buzzard and Webb, 2004, pp.7-11).
From the viewpoint of economists, at the beginning of industrial era, the first instance of flourishing essence of economic development came to the people through industrial recruitment strategy while the next wave recent global financial crisis emphasised on the retention of employees and preventing job cut. Under the recessional economy economists, academics, and pundits are arguing for governmental intervention to rescue expansion of organisations focusing on the market-based incentives including leveraging the resources aimed to bring economic growth. Thus, a good recruitment policy cannot only reduce staff turnover but also can contribute to rescue the economy from recessional impacts.
Loveridge (1995, p.10) presented arguments against the contribution of recruitment policy opposing very marginal economic arguments and stated that while staffs of an organisation leaving that entry by attracting through the recruitment policy of another organisation within the same nature of service industry may not bring any elevated contribution to the national income. Because of a good recruitment policy, an organisation can attract the staffs of another organisation that would face the disaster of staff turnover and take into account of lose in profitability but the individual employee would gain some thing from this battle while the industry scenario and contribution to the national income remains same. There is enough logic behind this argument and it is the strong approach to keep stopple on the staff turnover and prohibiting the recruitment policy while the changing economic activity among the organisations can deliver a superior overall competence revising their precedent mistakes and maladjustments in the new conditions.
In addition, the INGOs are classified under the service industry category where in long run workers, transportation, as well as market entry is much more significant issue to shaping gaps of costs among the site with policy-controlled variables like taxes along and site expenditures while the delivered services are not recognised with real decision-making. Meanwhile, the modern organisations are able to understand that the service seeker communities are enthusiastic to make suitable payment but while the providers come into competition to attracting the communities, consequently it sinking exacting rents (Russo, 2000, p12). Thus, an excellent recruitment policy would generate unparallel competition among the service providing organisations seriously droop the revenue generation by reducing rent where the movement of employees would increase (Stafsudd and Collin, 1999, pp 27-31).
Positive Case Study
ABC is working in Sri Lanka for last fifteen years with other INGOs keeping it successful tack record in the socio economic progression of the country by educating younger generations, providing nourishment to them, assisting with shelter for Tsunami victims, local capacity building of communities through micro credit, and leadership training. In the long race in Sri Lanka, ABC is facing high rate of staff turnover, while the local employees become familiar with programs of ABC, they switch to the other INGOs with higher salary range. Some time they violate employment rules and it is difficult for the people of grass root level to frame legal charge. In 2006, ABC introduced an excellent recruitment policy to reduce the organisation’s staff turnover that resulted very exciting outcomes and a large number of staff turnover reduced.
To do so, ABC identified lacing of traditional recruitment model that the organisation was using for last long, where the individuals were hired into a specific role and after providing some guiding trained they were allowed perform their jobs. The landmark recruitment policy of ABC introduced a new model however was proposed in an updated recruitment policy where by individuals would be recruited by assessing their attitude, potentiality, and hard working to touch high ambitions. Such selected individuals would be appointed provisional basis and send them for long motivation with the organisational objectives and programs to deliver their potential by removing the gaps through a predefined training. It was also directed in the recruitment policy that the top class employees may not be directly appointed, but comes from the lower level employees through promotion based on their abilities. They designed the pay scale upper than the national standard and increased investment for training and research, thus ABC able to reduce staff turnover.
Negative Case Study
In July 2006, the local miscreant killed seventeen employees of ABC and this staffs were innocent victims of Sri Lanka’s cruel civil war. This incident flourished all over the country and the employees of ABC shocked with this news of the dreadful murder of their co-workers who were carried out in the most brutal manner but all of them in the organisational duty. These individuals were deputed in wrong place by the ABC authority that demonstrated the lacing of care to the employees as the management of ABC are well know with the blood-spattered combat that has devastated the nation for more than two decades. These ABC employees were motivated to helping the exhausted nation to reconstruct by keeping hands together and working hard with the objectives to strengthen the life standard of war and natural disaster victims (Forut, 2006, p. 1).
ABC has just expressed their sympathy and condolence to the victimised families as well as the co-workers urged to the government to carry out a complete range of judicial investigation in to this regards but the authority of ABC do not provided any remarkable compensation to the victimised families or offered any job replacement to the family members. Consequence of the above fact the staffs of ABC lost their confidence to the organisation and the staff turnover increased severely and the organisation failed to present any good recruitment policy to attract new employees. Most of the programs of ABC in different parts of Sri Lanka failed to demonstrate any performance due to people’s unwillingness to join in this organisation, later on the governmental investigation presented some dangerous information that ABC has linked with the Tamil Tigers and argued to band its activities in Sri Lanka.
Cohen, Manion & Morrison (2007) and Malhotra (2009) argued that there are primarily two research approaches, for example, qualitative and quantitative. However, to organise this thesis paper, the researcher will adopt both approaches to find out the problems, but the researcher will equally concentrate on both qualitative and quantitative approach.
Miles & Huberman (1994, p.78) and Marshall & Rossman (1999, p.59) pointed out that gathering primary data is important for the explicit motive or determine the research gaps. Therefore, the researcher of this paper would consider primary data or quantitative data to monitor the actual position of working environment, employee satisfaction rate, recruitment policy and staff turnover. At this stage, the author would consider ABC INGO for data collection because this organisation competes with foreign organisations whose staff turnover rate is less than ABC INGO. For better understanding, this paper presents a table to provide more information about the interviewees –
|Name of NGO||Number of respondent||Respondents position|
|ABC INGO||10||New Employees||Worked for less than 1 year|
|ABC INGO||10||Ex Employees||Already Leaved|
|ABC INGO||10||Old Employees||Worked for more than 5 year|
Table 2: – Selected Respondents for interview. Source: Self generated
Field survey or Selection of Interview process
As Zikmund (2006) and Sekaran (2006) stated that the most significant approach of primary data collection process is face-to-face interview, the researcher of this thesis paper decided to collect data by field survey though it is time-consuming issue along with high cost. The researcher selected 25 male and 25 female employees of ABC INGO for survey report.
Data Analysis process
In this case, the researcher will check the collected primary data to remove mistakes or fabricated information about the recruitment policy and turnover issue. After checking the survey report, he would analysis the survey sheet and graphically represent the data by using Microsoft excel. On the other hand, the secondary data will be required to formulate the literature review, introduction, methodology and other discussion parts.
The literature part of this thesis paper mainly based on secondary data because there is huge information available about the effectiveness of recruitment strategy, retention policy, staff turn over and job satisfaction issues. However, Saunders, Thornhill & Lewis (2006) and Sekaran (2006) pointed out that the assortment of secondary sources are the published documents of renowned authors, for example, magazines, books, journals articles and previously research articles. Moreover, recruitment strategy is one of the most insightful matters in terms of staff turnover; as a result, it would be easy for the researcher to collect such information from books, online resources, academic report, and journal articles.
Yin (2003) and Malhotra (2009, p.281) pointed out that questionnaire is one of the most significant portions of the thesis paper and there are no specific rule of formulation of questionnaire as it is an art not science. However, the researcher of this thesis paper gave highest effort on the questionnaire, as findings chapter is completely depend on the response of target interviewees. Malthotra also addressed that broad conversation with respondents might bring unjust outcomes with different observation and opinion whereas specific questions help the respondents to discuss with a particular issue. This thesis paper concentrates more on this point as recommendations, conclusion, and the findings chapter is totally depend on the opinion of target respondents. However, the researcher intends to ask simple questions with two parts for the convenience of the respondents. However, the subsequent table shows the key elements of this questionnaire –
|Part 1||The basic purpose of first part is to introduce with the interviews, as a result, this part of the questionnaire would focus on the personal background of the respondents though it is subject to data protection act;|
|Part 2||The Final part of this questionnaire concentrated more on the research questions and research objectives, for example, the aim of the researcher is to know the employees opinion about the new recruitment policy, find out management fault, retention factors, and find out How a recruitment policy could address to decrease employee turnover.|
Table 3: – The questionnaire design process. Source: – Self generated.
Constraints to Collect Important Data
Lack of secondary data, undependable resources, correlation of numerous factors, and cost of the journal articles were the key constraints to formulate this thesis paper. At the same time, short deadline to finish the paper induced the researcher to collect primary data from limited employees of ABC INGO.
This Thesis paper would keep its keen eyes on two ethical issues, which are diverse nevertheless interrelated with each other, and laid on the fundamental point to the conduct such any qualitative research collectively with research in the topic and these ethical issues are the representation of truth as well as secrecy.
Data Analysis and Results
The questionnaire have handed over to fifty staffs of ABC Sri Lanka where twenty five were male and twenty five were females and all of them are middle level staff. ABC Sri Lanka is a non-profit nongovernmental organisation and profit and shares do not come into effect of staff turnover. There is flexible work hours already and the there is an established pay scale though all people are not happy about it. Performance evaluations have not done for about two years now since there was a change in the way the projects have been sustaining. Due to that they thought they should not do a performance evaluation till staff get used to their new Join Director of HR but increments related to COL was given though there is no performance related increment as budgets were also not available.
Table and Summary for Findings
|Question Numbers||Summary of Findings|
|1A||A general question necessary to introduce with the respondents of the survey|
|1B||5 respondents was between 21-30 years, 14 was between 30-40 years, 15 was between 40-50 years, and 4 was between 50- 60 years|
|1C||Maximum respondents was midlevel staffs of ABC Srilanka|
|1D||Out of 50 respondents, 25 females participated in the survey, whereas among 25 males, merely 13 males have participated|
Table 4: Summary of the Findings. Source: Self-generated from Collected Primary Data
Section A: Introductory Questions
Question 1A: Name of the Respondents
This was a common question essential to introduce with the respondents of the survey.
Question 1B: Age of the Respondents
Result: Among the respondents, age group 21-30 years were 13%, age group 30-40 years were 37%, age group 40-50 years were 39% and age group 50- 60 years were 11%.
Question 1C: Job Position of the Respondents:
Result: Most of the respondents are midlevel staff of ABC Sri Lanka
Question 1D: Sex of the Respondents
Result: Among the target populace 24% of the staffs were nuncupative and not interested to participate in this interview or don’t have time to effort those who are male 100% of the females were cooperative and contributed with their views.
Question 1E: Your contact details
Result: This information has kept for further reference
Section B: Survey questions
Question 2: What are the Reasons caused by management for Employees Turnover-
Result: 5% of the respondents identified the reason of turnover as the Management don’t l maintain any rank and file about assessing performance of the employees, 32 % of the respondents pointed out the reason of turnover as the management continuously shift from their decision obligating the employees. In some case 34% of the respondents recognised the reason of turnover as management raise unparallel competition among the employees while 29% the respondents predicted the reason of turnover as the belabour of management is rude and always blaming towards employees
Question 3: What are the factors impacts on employees to retain?
Result: 18% of the respondents argued that formulating new recruiting policy could avoid staff turnover and 13% respondents thin that introducing new ideas and skills thorough new recruitment can reduce staff turnover. Meanwhile 42% of the respondents think that providing training to the old employees and better pay can pass up staff turnover, 24% of the respondents emphasised that extended flexibility of employees can reduce staff turnover and 3% respondents think that contributing reward for performance and innovation can overcome staff turnover.
Question 4: What is your perception to reducing employee turnover?
Result: 34% of the respondent’s perception is that the obstacle of reducing staff turnover is the Poor pay structure while 29% respondents identify the obstacle of reducing staff turnover is discrimination of compensation and reward. Moreover 29% respondent’s perception is that the obstacle of dipping staff turnover is the substandard recognition, supervision and training opportunity while 5% respondents blame on Job and skill disparity among the employees and 3% identifies the substandard innovation and growth opportunity.
Question 5: What impact should employee turnover bring within the organisation?
Result: Among the respondents, 45% think that evasive staff turnover hampers organisational goodwill while 55% of the respondents identified that elusive staff turnover would cause disturbed service delivery. None of the respondents accounted that staff turnover can cause decreasing productivity, increasing recruitment costs and reducing revenue.
Question 6: What the measures companies can take to reduce turnover
Result: 29% of the respondents pointed out that companies can reduce staff turnover by offering extended pay structure while 50% of them seem that companies can reduce staff turnover by removing discrepancy and appreciating performances and 21% emphasised for healthy working environment.
Question 7: How a recruitment policy could address to decrease employee turnover,
Result: Among the respondents 32% mentioned that recruitment policy could address to decrease employee turnover by offering well designed compensation package while 58% respondents think recruitment policy with proper evaluation and performance measure for promotion can reduce staff turnover and 11% of them emphasised on respecting innovative skills.
Question 8: What is the reason of employee turnover at a particular job?
Result: 71% of the respondents identified over stressful duties and working condition is the reason of employee turnover at a particular job while 18% of the respondents marked the lack of training and communication as the reason of employee turnover at a particular job. Moreover, 8% of the respondents blamed increasing workload at a particular position for excessive staff turnover and 8% pointed towards monotonous nature of that job.
Question 9: What are the timely initiatives for the companies to balance employee turnover?
Result: 58% of the respondents think that addressing life and workflow balance is the timely initiative for the companies to balance employee turnover but 34% of the respondents reflect that changing workforce culture is the appropriate scheme for the companies to balance employee turnover and 8% argued for organising retention strategy.
Question 10: What are suggestions for the companies to overcome employee turnover?
Result: Among the respondents 45% emphasised on fair promotion and reword terms to overcome turnover while 39% suggested for competitive and fair compensation and 16% suggested to keeping negotiating opportunity.
Question 11: What factors the companies would take into account to formulating a recruitment policy to reduce turnover
Result: 47% respondents pointed out that on the time of formulating a new recruitment policy it is essential to take into account of the organisational culture while 29% of the respondents advocated that the factors companies would take into account to formulating a recruitment policy is the causes of turnover. On the other hand, 11% of the respondents supported the demographics & economy and 13% indicated towards unrealistic expectations.
Discussion & Findings
Case study part of the paper has analysed the staff turnover scenario of the ABC Sri Lanka. ABC is an international NGO3, which have operated in Sri Lanka since 1982. Along with the ABC there have two other major player Save the Children and CARE. Key feature of these organizations is that they have practiced equal opportunity employment recruitment policy though there have significant staff turnover cases. Considering literature framework, case study has examined a comparative staff turnover reasons and impact after staff turnover of these three INGOs as well as described an effective recruitment policy, which would have prescribed how to reduce employee turnover.
ABC: ABC is an international NGO, which has originated from Norway and operated in many countries especially in South East Asian countries. In this paper, ABC Sri Lanka has analysed in view point of employee turnover, retention, and recruitment. Currently, ABC Sri Lanka has operated their projects by 249 employees where 242 are Sri Lankan and the rest of 7 are international. Management bodies of the ABC Sri Lanka have followed PAYE, EPF, and ETF during application of the labour compliances. Key program of the organization is to protect and develop awareness against the humanitarian tasks of the civil society. More specifically, human rights, cure of drug addicted, women empowerment and children education. Around 6% of ABC’s annual fund4 has utilized by the ADIC5 for the reducing drug addiction ratio and principal amount has employed for the disaster recover relief (Baklien, et al., 2004).
Competitors of ABC
Save the Children
Similar to the ABC Save the children has also originated from Norway and operated in Sri Lanka for the last thirty years and their projects have operated over major cities6 for the progress of children’s rights such as better education facility, violence and abuse free atmosphere. Additionally, SCiSL7 has special attentiveness for the displaced children. SCiSL’s working associates8 have kept their support to look after, advertising and raise consciousness of children’s rights (Save the children, 2010).
Since 1950, Care international has operated their projects in Sri Lanka. Care’s project’s has divided into three major categories9. In view point of organization human resource management, Care has 240 employees where gender ratio between male and female respectively as 29% and 71%. In following table key attributes of Care in Sri Lanka has plotted (Linkedin, 2010).
Staff Turnover Scenario of ABC
Usually, employee turnover has stimulated by four broader factors. In case of international humanitarian agencies10 in Sri Lanka besides the fundamental issues the most significant reason for stuff turnover is that over twenty years long civil war between Tamil11 and Sinhalese (Hyndman & Alwis, 2008)). In the north and east portion of Sri Lanka common people have passed their daily life under great anxiety. Under this circumstance its enough tough for any type of organization to build working resources over and above ensure life security12. Following are the common reasons of staff turnover in the INGOs of Sri Lanka13.
- Incomprehensible corporate or organizational values that has frequently misguided employee’s duties and responsibilities;
- Inhospitable working atmosphere as well as no positive performance appraisal;
- No clear direction how to response during disaster affected period;
- Most of the time harsh organizational culture disheartened employees to think that they have not a significant part of the organization;
- Administrative inefficiencies;
- Poor rewarding approach discourage loyal and bright employees to perform better;
- Poor training appliances de-motivate to stay long time in an organization.
- Compare to workload and stress, remuneration and other allowances has not satisfactory for the current employees;
- Besides working atmosphere working time/schedule has also as stubborn as stressful;
- Intra official conflicts among workers over and above sick contest environment;
- Compare to workload and stress working resources have not enough sufficient.
Lack of accountability, gender biased attitude, minority treatment and lack of inter-ethnic cooperative scopes have another supplementary manners for which INGOs in Sri Lanka have suffered for staff crisis. In case of new generation, INGOs in Sri Lanka have appraised absent of loyalty to stay long time in an organization. Additionally, they have also unwilling learn new professional skills. Conversely, another key point is that balance between work and personal life is enough hard during this globalization era due to stress and over workload (Loquercio, 2006).
Impact of Stuff Turnover on ABC
A famous research report has appraised that yearly (16.7 – 21) % employee turnover has occurred in the INGOs. Thus, the INGOs have faced a large amount of employee turnover costs. Here, yet again has pointed that employee turnover is rather costly than recruitment. At the opposite side of economical issues, employee retention has also sufferer of valuable work time waste, efficiency reduction, productivity decrease, and risk of further employee turnover.
For the international humanitarian organizations staff turnover general impact of staff turnover has calculated the staff turnover ratio or rate by utilizing following equation. The following approach has considers total number of staffs who has leave during a year. More specifically, leave of an employee has also been considered of separation, layoff, termination, and retirement. Conversely, employee turnover is not always impact negatively. In case of inefficient staff’s turnover organisation has benefited rather than loss. Additionally, not only in Sri Lankan INGOs but also almost all type of organization has efficiently capable to reduce their turnover costs if their turnover has at reasonable range over and above irregular business growth. Therefore, it has been stated that employee turnover has not always harmful for an organization.
In following figure impact of staff turnover in a humanitarian organization/INGOS has distinctively pointed. Greater employee turnover rates have delayed organization’s current project execution. Consequently, on the performance of the project which might be drawn for noble purpose or disaster affected people’s welfare. Usually, INGOs or the domestic NGOs have suffered an uncertainty of sound fund or sponsor. Then again abnormal staff turnover has made the cost burden more bulky than before.
Staff Retention Strategies at ABC
During formulation of employee/ staff retention strategies employer has to be taken into account of seven major issues, which have sequentially denoted bellow. Alike other organization, INGOs in Sri Lanka has also be preserved a connectivity among the seven forces like recruitment, employee motivation, staffing, HRM planning and strategies as well as employee retention. Organisation admissible allowances have to be ensuring the balance between employees working and personal life. Here are the seven key issues of employee retention strategies (Loquercio, 2006).
- HRM strategy formulation is an effective aid to operate employees efficiently and long time (Abeysekera, 2007).
- Staffing has to be ensuring accountable and transparent policies therefore; recruitment would be fair and useful.
- Organizational culture has to be warm as well as leadership style. A sound managerial skill is an effective tonic for effectiveness.
- Regular consultation as well as communication would be shine employee’s working quality as well as performances.
- Fair recruitment as well as selection have to be undoubtedly described job description and job analysis thus after job employee turnover risk would be minimized.
- New professional skill development training has motivated employee’s learning thrust and after a long time organizational growth would be handsome than ever.
- Wage and salary structure have to balance between duties and responsibilities. And hence, employer would have feel and ensuring three aspects14 of standards life style of the employees
Though research on humanitarian staff turnover and retention has yet rare but few research analyses has drawn high performance approaches as well as long-time employee retention tools. The researcher has also paid their attention on three issues15 during strategy formulation (Kaplan, 2005).
- High involvements of the employees strengthen their intra-office communication, which is not only effective for the employees but also significant for employer empowerment and reduce employee turnover.
- HRM policy planning and practices has positively encouraged employee performance appraisal, regular feedback to the superior and modern professional training facilities.
- Rewarding encourage employees to be more committed as well as generate better performance delivery.
Considering all of these forces organization culture of an ING has to cultivate DDC16 through which both external and internal atmosphere of the organisation be welcoming for their employer and employees. Hence, bond between co-workers would be 5 times friendly then before and around 67% of employees have performed better than before.
Recruitment Policy to Reduce Staff Turnover
Formulating recruitment policy to reduce staff turnover rate both employer and employees have to be committed job duties and responsibilities according to job specification and job analysis as described in following table. After end of the table, six sigma methods have drawn for an effective recruitment policy, which would capable to reduce staff turnover over and above to build a high profile humanitarian organization.
- According to labour and employment Act 2006 employers have to be fair on employing skilled and talent candidates rather than preferring relatives.
- Recruitment policy has to be as simple as global standard so that both the employer and organisation would be creating a brand image. Therefore, an employer could easily seek desirable candidate and conversely, competent applicant’s has be interested to be a part of promising brand image.
- Offer attractive payment and both on-job and off-job training and other admissible benefits companies can be operated effective recruitment as well as get most talented employees.
- Other than external recruitment employers have also utilized internal references whilst recruiting employees. In this case, along with bright employee organization would be get retention security.
- As described in the labour and employment Act 2006, in the opposite site of talent hunting organizations have to be conscious on equal employment opportunity. More specifically, HRM planning and strategy formulation have to be racism, gender bias, colour, sensitive religious irritation free. Thus, both male, female, minor and disable would be able to proof their professional skills.
- Investment on widening employee’s professional skills and productivity is another significant recruitment strategy, which has dramatically, reduce employee turnover. Conversely, many organizations have considered their employees as a short-term business asset but investment on employee has changed this view over and above retain skilled employees for a long time.
Conclusion & Recommendations
What We Recommend
- It is arguable that when an employee gets a sound, easy-going, and friendly atmosphere to work in, where the employer is very watchful about ensuring workplace health and safety issues, providing equal opportunities for all disregard of their ethnic origin, it gets easier for the staff to cope up with the working environment of the organisation lowering chances of turnover. It is therefore essential for ABC INGO to build up a staff retention strategy keeping all these things in mind.
- In addition, one of the key issues that ABC should be concentrating in is motivating the staffs at work with the help of implying Theory Y. The organisation can do it through providing staffs with better pay, compensation, employment benefits, and bonuses. To lessen the efforts, workloads, and hard works of the employees and to match up with the world that is dependent upon technological advancements, ABC must construct efficient communication network both inside and outside of the organisation by adopting modern IS integration and e- commerce approach through the development of its IT-infrastructural strategies.
- When it comes to retaining staffs, ABC needs to make sure that the people who are in the top management possess all the features that can reflect strong leadership instincts to achieve the objectives of the organisation.
- The organisations has to be more focused in order to cut down turnover rates by means of formulating an all-inclusive guiding principle that would emphasis in joint working efforts of the top management and cooperative teamwork amongst mid level co-workers.
- It is important for the HR department of ABC INGO to adapt a more smart approach in terms of employee retaining process. It should bring transformations in the total performing periods in order to make sure that the workers are getting enough freedom to spend a few hours with his/her family.
- The organisation must be strictly managing some vulnerable concerns such as healthcare benefits, rising work pressure for nerve racking responsibilities, increasing working hours, monotonous features of the occupation, deficiency of guidance, performance assessment for giving promotions, and accountable union privileges.
- Most essentially, it is imperative for the organisation the undertake a number of schemes and policies, for example, providing competitive and reasonable remuneration, reorganization of the worker maintenance plan, altering personnel traditions, delivering work stream composure, and observance of online recruitment opportunities constantly. The ABC INGO should take into account some significant aspects in order to originate a recruitment policy to diminish turnover which would focus on not only the motive behind turnover, organisational political principles, or organisational culture, but also on the overall positional strategy of the organisation.
- Together with the recruitment policy, ABC’s HR panel must be more cautious about assuring an accessible payment structure, and appreciating the working expertise, innovative, and creative ideas of the workers as well. Moreover, it is important for the organisation to consider the consequence of the employee turnover as the main reason of its rising costs of recruitment adversely affecting the organisational good will and depriving the annual targets.
Why We Recommend
The readers and INGO professional would go through this study and take the recommendations to bring into practice for their organisational practice to improve their staff turnover situation by executing a good recruitment policy. Thus, it is essential to carry out strong reasons to argue the logical ground that will assist to convincing the readers to take this study as true and fundamental one. While the readers logically convinced with findings of this study, they will go for implementing them within their organisation thus the researcher has formulated the recommendations.
This researcher strongly believes that management of INGOs have the same obligations to evaluate and understand the crisis created from staff turnover and can monitor and administer them with a good recruitment policy that would also reduce the cost of staff reappointing incurred by the retention, investment for the talent nourishment must add value to the organisation. Management of INGOs are under pressure for exploiting the employees in the name of voluntary service they are violating employment norms and let employees to perform hard job without pay. Thus, a good recruitment policy would be able to bring accountability for the success that has carried out with this recommendation and the managers would be capable to formulate their appropriate strategies for staff retention because of underlying organisational objectives.
Another reason of why the recommendation is, some time it creates biasness with the findings of research while the users explain the outcomes from their own perspectives moving from the standardised scale, recommendations would protect such biasness by directed the readers what actually the researcher tried to enlighten. This research argues to implement a configuration of recruitment policy that integrated the strategy to overcome the risk of staff turnover keeping full attention to the employees and the recommendations presented the reference to the expected strategy, this is why recommendations made.
How we recommend
The expert testimony on the topic area and the capabilities of a research to generate a guiding principal to support research findings and ensure a superior performance identified by the survey tools would be the recommendation. These recommendations have been generated from the outcomes of this research. This researcher has aimed to investigate the role of good recruitment policy on reducing the staff turnover within the organization. With this view, the researcher has designed a research, identified the research gap, derived to search relevant literature review, conducted a field survey, analysed the collected data and depending on the findings, this researcher has formed the recommendation. This is the general perception of formulation recommendations of a dissertation or thesis that would contribute further research.
In this dissertation, the researcher has investigated the conceptual framework of recruitment policy and staff turnover with the view to formulate a recruitment policy that would be capable to reduce staff turnover of the organisation. With this view, it has conducted both secondary and primary research among the employees of ABC, an INGO working in Sri Lanka. The collected data of gathered from the primary research has been analysed with Microsoft Excel generate the finding upon the viewpoint of ABC employees, integrating the findings, this recommendation has been organised which would be useful for the INGOs working in the developing countries. To formulate this recommendation this researcher kept full attention to the conceptual framework along with the employee’s perspectives with out any bias to any predetermined point of view.
This paper has formulated following recommendations to reducing staff turnover
- From the survey report, it can be found that management fault is the fundamental problem to increase staff turnover, which is really difficult to remove by formulating a new recruitment policy;
- In addition, management of the ABC INGO should modify its regular working hours and ensure liberal working hour, which would not create any pressure on employee’s personal life, so it will reduce staff turnover;
- In order to reduce staff turnover, companies should implement team requirement policy;
- The turnover issue is most significant, as it can pinpoint a leadership problem; therefore, theme of leadership needs to modify. In addition, the leaders of ABC should be educated enough to handle with all sorts of responsibilities by introducing participative approach where the advise and feedback of each individual will be treated with respect with a motto of proved democracy.
- The management team of ABC INGO should also develop a suitable working atmosphere where all the employees should be treated as a motivated group who are aware about the goal of the organisation;
- However, most the existing employees believe that ABC INGO should change reward policy, increase salary, Extended flexibility of employees rather than change of recruitment policy;
- Besides recruitment issue, management should concentrate on payment structure, equal opportunity, job skills, and innovation, supervision, and training opportunity;
- The management of the organisation should consider the consequence of the staff turnover as it is increasing recruitment costs, affecting on reputation reducing productivity, and profit margin;
- It should develop effective communication network both inside and outside the organisation by adopting modern IT integration of e- commerce approach in terms of m- commerce;
- The strategy of teamwork should develop because co-operative management technique is effective while each project will placed in-group, then the employees will solve them by multi-tasking under the moderation of operational management;
- ABC INGO should try to retain existing employees by offering better salary comparing other foreign NGOs, appreciating performances, promoting flexible working hours and ensuring healthy working environment;
- The Management should try to reduce workload of the employees;
- Management should technically handle some sensitive issues like healthcare opportunities, Increasing workload, over stressful duties, increasing overtime, repetitive nature of job, lack of training and communication, performance measure for promotion, and responsible union rights;
- ABC INGO should take few policies, for instance, offering competitive and fair salary, restructuring retention strategy, changing workforce culture, addressing workflow balance, and keeping online recruitment drives continuously
- Finally, the management should take into consideration few important factors in order to formulating a recruitment policy to reduce turnover, such as, the reason of turnover, organisational politics, organisational culture and the present position of the organisation.
This dissertational effort has offered for arguments to identifying the tools deliberated to corresponding with the readers understanding the conflicting trends of staffs to goodbye the organisation and the shocks that seriously affect the organisational growth. The way of recruitment is a lengthy process with associated cost and after recruitment if the staffs leave the organisation, there should be serious impact on over all performance that would urge for organisational change and some time such quitting bring almost disasters in the operation of the organisation. With the predominated hypothesis that the influential recruitment policy can effectually avoid high rate of staff turnover – this research has driven to evaluate hypothesis with a practical evidence and data of ABC and come in conclusion that higher range of voluntary staff turnover is avoidable and manageable to a tolerance level with am effectual recruitment policy. Testing the entire presumed hypothesis this paper has identified the cause and effect of voluntary staff turnover and suggested an effectual recruitment policy as a strategic initiative to avoiding such heuristic events in the modern organisational practice. It will contribute the management of the organisation ABC to take timely imitative to overcome the shocks of staff turnover while it will facilitate the academia for further research.
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Thank you for participating in the survey. The questionnaire is a part of my dissertation, a requirement of my MBA program I’m enrolled in. your response and details will be used only for the purpose mentioned below and will not be disclosed.
|Sl. No||Introductory Questions||Answer|
|01||Introductory to you|
|A||What is Your name|
|E||Your contact details|
|02||What are the Reasons caused by management for Employees Turnover|
|A||Management deploy other people at your functioning area that conflict with your performance|
|B||Management don’t at all maintain any rank and file about assessing performance of the employees|
|C||Management continuously shift from their decision obligating the employees|
|D||Management raise unparallel competition among the employees|
|E||Management’s belabour is rude and always blaming towards employees|
|03||What are the factors impacts on employees to retain?|
|A||Formulating new recruiting policy|
|B||Introducing new ideas and skills thorough new recruitment|
|C||Providing training to the old employees and better pay|
|D||Extended flexibility of employees|
|E||Contributing reward for performance and innovation|
|04||What is your perception to reducing employee turnover?|
|A||Poor pay structure|
|B||Discrimination of compensation and reward|
|C||Job and skill disparity among the employees|
|D||Substandard recognition, supervision and training opportunity|
|E||Substandard innovation and growth opportunity|
|05||What impact should employee turnover bring within the organisation?|
|B||Increasing recruitment costs|
|C||Disturbed service delivery|
|E||Hampers organisational goodwill|
|06||What the measures companies can take to reduce|
|A||Offering extended pay structure|
|B||Removing discrepancy and appreciating performances|
|C||Introducing a profit sharing plan|
|D||Promoting flexible working hours|
|E||Healthy working environment|
|07||How a recruitment policy could address to decrease employee turnover?|
|A||Offering well designed compensation package|
|B||Enhanced healthcare opportunities|
|C||Proper evaluation and performance measure for promotion|
|D||Respecting innovative skills|
|E||Responsible union rights|
|08||What is the reason of employee turnover at a particular job?|
|A||Increasing workload at the position|
|B||Over stressful duties and working condition|
|C||Increasing overtime but lower Organisation practices|
|D||Monotonous nature of job|
|E||Lack of training and communication|
|09||What are the timely initiatives for the companies to balance employee turnover?|
|A||Assessing the costs associated with turnover|
|B||Organising retention strategy|
|C||Selecting changing workforce culture|
|D||Addressing life and workflow balance|
|E||Implementing an expected turnover plan|
|10||What are suggestions for the companies to overcome employee turnover?|
|A||Competitive and fair compensation|
|B||Fair promotion and reword terms|
|C||Keeping online recruitment drives continuously|
|D||Preventing discussion with wage|
|E||Keeping negotiating opportunity|
|11||What factors the companies would take into account to formulating a recruitment policy to reduce turncover?|
|A||The Causes of Turnover|
|B||The demographics & economy|
|C||The performance of the organisation|
|D||The organisational culture|
- Human Resource Management
- The Organization for Economic Co-operation and Development
- Non-Government Organization
- Tthe Norwegian Ministry of Foreign Affairs, Norad, UNHCR, the World Bank and SIDA
- Alcohol and Drug Information Centre
- Akkaraipattu, Batticaloa, Jaffna, Matara, Kilinochchi, Mannar, Tricormalee and Vavuniya
- Save the children in Sri Lanka
- Ministries, departments and institutions of the Government of Sri Lanka, local non-government humanitarian organizations
- Target groups – conflict affected people in the north and east, poor, rural communities in the dry zone and residents of Sri Lanka’s tea and rubber estates
- FORUT, Save the Children and CARE
- Liberation Tigers of Tamil Eelam (LTTE)
- Abeysekera 2007
- Loquercio 2006
- Health, Safety and Security
- Engagement, performance and retention
- Developing, Deploying and Connecting