Human Resource Management:Gaining a Competitive Advantage

Chapter 10

Employee Separation and Retention

Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

Learning Objectives

Distinguish between involuntary and voluntary

turnover and discuss how eachcan be leveraged

for competitive advantage. Listand apply major elements that contribute tothe

perceptionof justiceto disciplineand dismissal. Specify the relationship between job satisfaction and

job withdrawal and identify sources of job satisfaction. Design and use a survey feedback intervention

program to promote retention of key personnel.

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Introduction

To compete, organizations must ensure: Good performers are motivated to stay. Chronically low performers are allowed, encouragedor if necessary, forced to leave.

2 Types of Turnover: Involuntary turnover—initiated by the organization(often among thosewho would preferto stay).

Voluntary turnover—initiated by employee(often those the company would prefer to keep).

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Managing Involuntary Turnover

Employment-at-will doctrine- in the absenceof a specific contract, either an employer or

employee could sever the employment relationship at any time.

Violence in the workplace caused by involuntary turnover has become a major organizational problem in recent years.

A standardized, systematic approach todiscipline and discharge is necessary.

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Principles of Justice

Outcome fairness-the judgement that people makeregarding outcomes receivedrelative to outcomes received by others with whom they identify.

Procedural justice- focuses on methods used

to determine the outcomes received.

Interactional justice- refers to the interpersonal nature of how the outcomes were implemented.

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Progressive Discipline2 Components of Discipline Programs

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4 Determinants of Interactional Justice

1. Explanation1. Explanation

3. Consideration3. Consideration

2. Social sensitivity2. Social sensitivity

4. Empathy4. Empathy

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Peer Review

Open Door Policy

Mediation

Arbitration

4 Stages of ADR

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Employee Assistance Programs

EAPs attempt to ameliorate problems encountered by workers who are drug dependent, alcoholic, or psychologically troubled.

EAPs are usually identified in official documents published by the employer.

There are several issues in controversy regarding EAPs.

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Outplacement Counseling

Helps displaced employees manage the transition from one job to another.

Services such as job search support, résumé critiques, job interviewing training and networking opportunities may be provided

in-house or through an outside source.

Aimed at helping people realize that other opportunities exist.

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Managing Voluntary Turnover – Job Withdrawal

Progression of Withdrawal Theory-dissatisfied individuals enact a set of behaviors in succession to avoid their work situation.

3 categories:1. behavior change2. physical job withdraw3. psychological job withdraw

Withdrawal behaviors are related to one another, and partially caused by job dissatisfaction.

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Job Dissatisfaction-Job Withdrawal Process

Causes - Job dissatisfaction

- Personal disposition- Tasks&roles- Supervisors& coworkers- Pay&benefits

Manifestations -job withdrawal

- Behavioral change- Physical job withdrawal- Psychological job withdrawal

JobDissatisfaction

JobWithdrawal

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Behavior Change

An employee's first response to dissatisfaction would be to try to changethe conditions that generate dissatisfaction.

When employees are unionized, dissatisfaction leads to an increased grievances.

Employees sometimes initiate change through whistle-blowing - making grievances public by going to the media or government.

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Physical Withdrawal

4 ways a dissatisfied worker can physically withdrawal from the organization:

1. Leave the job

2. Internal transfer

3. Absenteeism

4. Tardiness

Companies spend 15 %of payroll costs to make up for absent workers on average.

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Job Satisfaction and Job Withdrawal

Job satisfaction is a pleasurable feeling that results from the perception that one's job fulfills one's important job values.

3 aspects of job satisfaction: 1. values2. perceptions3. Importance

Frame of Reference serves as a comparison for other points and provides meaning.

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Pay andBenefits

Tasks andRoles

Sources of Job

Dissatisfaction

Personal Dispositions

Unsafe Working

Conditions

Supervisors andCoworkers

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Unsafe Working Conditions

Each employee has a right to safe working conditions under the Occupational Safety

and Health Act of 1970 (OSHA).

Financial bonuses linked to specific safety related goals help keep employees focused

and pay for themselves over time.

Firms that emphasize safety send workers a clear signal that they care about them.

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Sources of Job Dissatisfaction

Personal Dispositions Negative affectivity is a dispositional

dimensionthat reflects pervasive individual differences in satisfaction with any and all aspects of life.

Tasks and Roles The nature of the task itself is the key predictor

of job dissatisfaction. Job Rotation Prosocial Motivation

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Sources of Job Dissatisfaction

Supervisors and Coworkers A person may be satisfied withhis or her

supervisor and coworkersdue to:– shared values, attitudes, and philosophies,– strong social support

Pay and Benefits For many people, pay is a reflection of self worth,

so pay satisfaction takes on critical significance when it comes to retention.

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Survey Feedback Interventions Surveys:

emphasize overall satisfaction. assess the impact ofpolicy changes. allow the company to compare itself with others in the

same industry. allow the company to check for differences between

units and benchmark “best practices.”

If people fail to see timely actions taken on matters identified as problems in the survey, satisfaction is likely to be lower than it would be in the absence of a survey.

Any strategic retention policy has to consider surveying people who are about to become ex-employees.

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Summary

Involuntary turnover reflects a separation initiated by the organization.

Voluntary turnover reflects a separation initiated by the individual. It can be minimized by measuring, monitoring and surveying, then addressing problems found in the surveys.

Organizations can gain competitive advantage by strategically managing the separation process.

Retaliatory reactions to organizational discipline and dismissal decisions can be minimized.

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