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Employee turnover, especially the voluntary one, has been regarded as an undesirable and unavoidable phenomenon that most often influences a company’s performance in a rather negative way. As a result, numerous studies have been devoted to the effective management of this process (Liu et al. 2011).
In this paper, the phenomenon of employee turnover is going to be described. The role of human resource managers in the management of employee turnover in organisations is going to be discussed, and examples of strategies aimed at controlling the issue are going to be provided.
The Definition of Employee Turnover
Employee turnover can be defined as the ratio of the number of workers that have been replaced during a period of time to the overall number of employees in the company during the same period of time (Sexton et al. 2005; Wallace & Gaylor 2012; Liu et al. 2011). This process is caused by a number of reasons, and the voluntary and involuntary types of turnover have been singled out in order to facilitate their classification.
The voluntary turnover presupposes “the termination of employment initiated by the employee” (Sexton et al. 2005, p. 2636). In connection with voluntary turnover, the turnover intent should be mentioned. It is the term that is used to describe the desire of an employee to resign. Turnover intent does not necessarily result in turnover; however, it is an important parameter of workers’ mood.
Many turnover management activities are aimed at the reduction of turnover intent (Tuzun & Kalemci 2012; Liu et al. 2011). At the same time, the termination of employment can take place regardless of employees’ intentions, for example, as a result of layoffs, discharges, as well a worker’s permanent disability or death. All of these situations can become the causes of involuntary turnover. It is obvious, therefore, that the process of turnover is natural and cannot be avoided.
The Implications of Employee Turnover
The implications that employee turnover holds for companies are mostly regarded as negative ones. First of all, it should be mentioned that turnover is accountable for the costs that are reflected in “advertising fees, recruiter fees, management’s time for decision making, Human Resource’s recruiting time, selection, training, overtime expenses from other employees needed to pick up slack, lost productivity and sales” (Wallace & Gaylor 2012, p. 27).
Apart from that, as the productivity of a company is endangered, the quality of its production or service may also decrease which results in customers’ dissatisfaction (Wallace & Gaylor 2012; Sexton et al. 2005). Finally, it has been repeatedly pointed out that voluntary turnover may result in a decrease in the employee’s morale which is an extremely undesirable outcome (Liu et al. 2011, p. 1305; Wallace & Gaylor 2012).
However, it should be taken into account that the results of a turnover are also not only harmful. In this respect, it is necessary to mention another turnover classification. The functional turnover occurs when “low-performing employees are replaced by higher-performing ones» (Wallace & Gaylor 2012, p. 27). In case of a dysfunctional turnover, it is the high-performing employees that leave.
It is obvious, that a company’s performance suffers mostly in the case of dysfunctional turnover; however, functional turnover can increase the company’s performance in the long run despite the costs related to the turnover as a phenomenon.
Managing Employee Turnover
From the information provided above it can be concluded that a company’s human resource managers should attempt to maintain functional employee turnover (Sexton et al. 2005). A number of turnover reasons cannot be predicted (for example, a worker’s death), and, in this case, a manager can only attempt to reduce the negative impact of the phenomenon.
At the same time, many of turnover aspects can be regulated at least to an extent. This includes dismissing poor-performing employees, hiring higher-performing ones and, most importantly, keeping the latter from resigning. Therefore, it is the voluntary turnover that human resource managers need to take into account first of all. As a result, this type of turnover has been studied extensively by human resources scientists (Liu et al. 2011).
Naturally, many of these studies are devoted to the strategies aimed at decreasing employees’ turnover intent. The factors that are influencing a person’s turnover intent are exceedingly numerous. The following section is devoted to mentioning only a few of such factors along with the actions that a human resource manager may undertake to reduce the employees’ turnover intent.
The Suggestions for Managing Employee Turnover
An important factor that influences employees’ turnover intentions is their job satisfaction, which can be increased through numerous strategies. For example, the importance of motivating employees does not need to be proved. One of the ways of achieving this includes empowerment or autonomy orientation which presupposes predisposing “individuals to pursue actively opportunities for self-determination and orient toward autonomy stimuli in the social environment” (Liu et al. 2011, p. 1306).
By helping workers to realise their potential within the field of their job, a manager is able to increase the employee involvement, satisfaction and encourage them to develop. Similarly, providing learning opportunities leads to the increase in an employee’s productivity and their job satisfaction, engagement, and even perceived support (Shuck et al. 2014).
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Here, it should be pointed out that the organisational and supervisory support (as perceived by the employee) also serves to raise employees’ satisfaction (Tuzun & Kalemci 2012). It is obvious that all of the mentioned activities have a positive effect on the employees’ productivity and a negative one on their turnover intent. They also appear to be interrelated and contributing to the increase of employees’ commitment.
Commitment is one of the most important parameters that can reduce a person’s turnover intent. There exist numerous commitment profiles which include the emotional attachment to the team, other peers, and the supervisors; the moral obligation that an employee experiences towards the company, and even the so-called continuance commitment that presupposes regarding current situation as “convenient” which discourages a worker from resigning.
It has been proved, however, that commitment has the potential of reducing turnover intent in either case, which means that developing this feature is a promising activity (Stanley et al. 2013).
While employee turnover is a process that cannot be avoided, it can be managed, and the aim of human resource managers is to maintain a functional turnover that would positively affect the performance of their company. In this respect, the strategies that are aimed at decreasing the turnover intent of employees are an important issue.
Related managerial activities may be directed at the increase of an employee’s job satisfaction and involvement as well as the perceived organisational and supervisory support. It appears that all these factors are interrelated and contribute to the employees’ commitment.
Apart from that, the mentioned strategies tend to improve the performance of the employees and encourage them to develop, which, in the long run, turns out to be beneficial both for the company and the workers.
Liu, D, Zhang, S, Wang, L & Lee, T 2011, ‘The effects of autonomy and empowerment on employee turnover: Test of a multilevel model in teams’, Journal of Applied Psychology, vol. 96, no. 6, pp.1305-1316.
Sexton, R, McMurtrey, S, Michalopoulos, J & Smith, A 2005, ‘Employee turnover: a neural network solution’, Computers and Operations Research, vol. 32, no. 10, pp.2635-2651.
Shuck, B, Twyford, D, Reio, T & Shuck, A 2014, ‘Human Resource Development Practices and Employee Engagement: Examining the Connection With Employee Turnover Intentions’, Human Resource Development Quarterly, vol. 25, no. 2, pp.239-270.
Stanley, L, Vandenberghe, C, Vandenberg, R & Bentein, K 2013, ‚Commitment profiles and employee turnover’, Journal of Vocational Behavior, vol. 82, no. 3, pp.176-187.
Tuzun, I & Kalemci, R 2012, ‘Organizational and supervisory support in relation to employee turnover intentions’, Journal of Managerial Psychology, vol. 27, no. 5, pp.518-534.
Wallace, J & Gaylor, K 2012, ‘A Study of the Dysfunctional and Functional Aspects of Voluntary Employee Turnover’, S.A.M. Advanced Management Journal, vol. 77, no. 3, pp. 27-36.