THE STUDY OF UFONE) By Laiq Ahmad Shah 1.

THE IMPACT OF HUMAN RESOURCE PRACTICES, JOB SATISFACTION AND ORGANIZATIONAL
COMMITMENT ON EMPLOYEES’ TURNOVER INTENTION (A CASE STUDY OF UFONE)

 

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Laiq
Ahmad Shah

 

 

1.           INTRODUCTION

Reduction of employee turnover through
retention is an area of greater importance to employers who are dependent on
highly qualified and skilled human resource. In telecom sector in recent years
due to tough competition and too much stress employee turnover intentions are
on much higher side now. The type of skill and work type, the training needed,
and small numbers of qualified and skillful applicants, it is necessary for an
organization to retain its employees and minimize turnover intentions. This
study will counsel the linkage factors that may predict the probability of
recently employed employee’s intentions to quit.

Human resource practices are very influential
in job satisfaction of new employees and commitment level to their
organization.  These factors can help in
predicting employee’s intention to quit. This study will be sharing finding of
research conducted in Telecom sector of Pakistan targeting Ufone. The study
will target employees with less than 5 years of employment and investigate HR
practices that are influential in employee turnover intentions, specially
outsourced employees. It will show a relationship between Human Resource
practices perception and turnover intentions with mediator of organizational commitment
and job satisfaction.

This study will propose important suggestions
for organizations or anyone who want to work in related field. Data will be
collected through questionnaire. Voluntary turnover is a major concern for
management when your skilled employee leaves your organization. Nowadays
outsourcing has been adapted by many organizations. A group formed new called
as emergent workers. They are different as compared to traditional workers as
due to their working situations and experience. Emergent workers resulted after
a paradigm shift as a result of downscaling and outsourcing of companies and
organizations in the 1980’s and 1990’s and as in present too (Spherion,2010).

Weak economy with high unemployment rates which
is resulting in recession has restricted many employees to stay in same
organization. However with the recovery of economy opportunity of employment
increases, non-engaged or non-appreciated workers will be likely leaving their
current positions (Mc Keown, 2010). In organizations where relationships are exceptionally
significant to the success of their operation and success, regular turnover of greatly
valued employees can be damaging. We will be examining the connection between
HR practices (Recruitment and selection, evaluation, supervision, training and
development), organizational commitment, job satisfaction and turnover
intentions.

 

1.1        PROBLEM STATEMENT

Turnover intentions is a very serious concern in most
cases as it ultimately leads to employee turnover or employee dissatisfaction
and lowering the productivity. And employee turnover is a very serious issue
for any organization when your top performing employees are leaving your
organization for another organization. Some measures must be taken to retain
them. Turnover bears cost for organization such recruitment and selection,
training and development etc. Highly skilled and trained employees are likely
to quit as they can easily find other opportunities so they must be retained. Turnover
is costly for organizations. Both voluntary and involuntary turnover could be
dysfunctional if the result is a loss of human capital (Campbell, Coff & Kryscynski,
2012). Direct costs which includes recruitment & selection, and training of
newly hired employees, while also having indirect costs, such as stress on
residual workers, low productivity, and low morale for organizations, can be costly
as much as totaling a two years pay and benifit (Ramlall, 2005). With the
outsourced workers being the recent category of worker, organizations are
required to pay special attention of these highly skilled employees as they
have little fear of job change (Spherion, 2010). HR practices of an
organizations has a direct impact on employee’s turnover intentions.

 

1.2        OBJECTIVE OF THE STUDY

·        
To examine the influence of HR practices (recruitment
and selection, evaluation, supervision, training and development) on the job satisfaction
and organizational commitment of employees as they relate to turnover
intentions.

·        
To
investigate newly hired employees organizational commitment level, job
satisfaction and turnover intentions.

·        
To examine the connection between HR practices (recruitment
and selection, evaluation, supervision, training and development),
organizational commitment, job satisfaction and turnover intentions.

 

2.          LITERATURE REVIEW

Understanding the importance of this study,
surrounding circumstances of the outsourced workers and turnover must be
investigated and studied. Group of the workers, factors influencing their job
satisfaction, commitment, turnover intentions, Human Resource practices that
are leading to employee turnover and how organization is being impacted by
turnover.

2.1     Description of
Emergent Workforce

Emergent workers are a cluster of the employees that
is becoming more important. For the last 12 years this worker’s group has been
studied annually by a recruitment organization called the Spherion which
expressed that the economic issue of 2008 which was a critical moment in the
workers in going to the workforce (Spherion, 2010). In 1980’s and 1990’s
downsizing also shaped a pattern change in the mode that people interpret their
work life and cope with their careers (Harding, 2000). Emergent workers
differentiate from the traditional ones as traditional workers have a trust
that the employer are solely responsible for their career and, that their commitment
level to the organization is grounded upon durable job security, and that they must
permanently trail organizational rules. Lifetime employment is being considered
as reward for loyality (Spherion, 2010).

An emergent worker is a kind of a product due to
employment situations of downsizing, and lack of permanent lifetime employment (Harding,
2000).

 

2.2   Organizational
Commitments types

One factor that may contribute to employee connection
is known as organizational commitment. Numerous studies have been conducted on
organizational commitments. The theory of organizational commitment was
established by Porter, Steers, Mowday and Boulian(1974). They defined
organizational commitment, a will to exercise substantial struggle on behalf of
the organization, and a strong desire the member of the organization” (Porter,
Steers, Mowday, &Boulian, 1974).

Then the Meyer and Allen (1991) stretched the theory
by the addition three components of commitment: continuance of commitment,
effective commitment and normative commitment. It considers the costs related
to leaving the organization, like as the time invested by the employee for
critical economic situations.  Effective
commitment is defined as the emotive connection, identification and attachment
that the employee has with the particular organization and its goals. Normative
commitment is a sense of responsibility and commitment to be the part of
organization.

These may include societal expectations or may be
family expectations that an employee has learned from so to be loyal to the
employer. “Communal to the three approaches is the opinion that commitment is a
psychological state that (a) symbolizes the employee’s relationship with the
organization and (b) effect on the decision to either stay or leave the organization”
(Meyer, Allen & Smith, 1993, p 539).  Mostly the studies conducted on organization
commitment have concentrated on effective commitment. The reason behind is it
is the strongest and consistent forecaster of what outcome organization wants
such as employee retention (Mohamed, Taylor, & Hassan, 2006, p.514). It
makes it essential to study the effective commitment of workforce which works
as an indicator of commitment to the organization and have relation with the
employee’s intention to quit.

 

2.3     Job Satisfaction
and Intent to Quit

Robbins in addition to Determine (2013) explained
turnover intention will be that when a person will be contemplating to give up
the job. Involved employees are excited in addition to devote strength for it,
and thus reaching increased numbers of activity performance (Christian et’s,
2011).  Sliter et al. (2012) reported
in which turnover intentions directly effects the performance and output of an
employee and has damaging impacts of organization. Job satisfaction was defined
as the attitude which includes promotion, supervision, benefits, colleagues,
nature of work, operating processes and communications ( Park and Kim 2009).  By improving their organizational commitment
in order to reduce employee turnover intention. The final decision to quit is
due to when job dissatisfaction reaches a level that employee decides or
desires to move or leave the job (March & Simon, 1958). Mobley (1977)
proposed a exploratory model turnover intention, considering it the final step
of leaving the job. Turnover intention is led by numerous decisions that the
employee has to make before making the final decision for quitting.

Job dissatisfaction is a key which leads to turnover
intentions. Mobley, Horner, and Hollingsworth in 1978 developed a streamlined version
of Mobley’s 1977 model which suggested the following causal linkages: job
satisfaction and intentions to quit; intent to quit and intention to search; likelihood
of getting a reasonable  alternative intention
to search; intention to search intention to quit; and intention to quit turnover
(Mowday, Koberg, & McArthur, 1984). In 1978 Mobley, Horner, and
Hollingsworth analyzed age and tenure having an indirect effect on turnover and
job satisfaction and chances of finding a reasonable alternative. Same model
suggested that turnover intentions are directly affected by job satisfaction,
thinking about quitting, the intent to search for new or the intent to stay or
quit, but having inverse effect on actual turnover.

 

 

 

 

2.4    Impact of
Turnover on Organizations

 

Employee switching their jobs cannot possibly
be controlled by the organization. Regarding this employee Turnover either
voluntary or involuntary movement employees in an out of work organizations –
is of key significance in Ability management. It is therefore obvious that
employee turnover remains the main concern in management literatures whether it’s
voluntary or involuntary. It’s a major issue for both types of organizations
i.e profit and non-profit. (Choi & Lee, 2011: 91). Voluntary ratio contains
a additional important and negative impact on structure performance and
effectiveness than involuntary turnover (Shaw, Gupta, ; Delery, 2005;
Tariq, et al., 2013). A lower ratio might cut back separation and replacement
prices and increase employees’ loyalty and commitment to a company that
successively may lead to raised structure performance. Indirect prices of ratio
embody non continuous structure processes, low morale, adjustment time of
replacement workers, a poor structure image, client discontent, and most
significantly, a loss of human capital (Grissom, et al., 2012; Rainey 2003;
Sing & Loncar, 2010; Wang, et al., 2012). to stay a healthy
organization it’s essential to stay the workers engaged, challenged and supply
them with the expertise of development in their work (Christensen et al.,
2012).

Employee turnover is expensive development for firms
and organization. Direct costs area unit achievement, selection, and coaching
of recent individuals. Indirect costs area unit such things as redoubled
workloads and overtime expenditures for coworkers, still as reduced
productivity related to low worker determination. Taking under consideration
each the direct and indirect costs of turnover, the minimum price equates to 1
year’s pay and advantages and a most of 2 year’s pay and advantages (Ramlall,
2005).But not all turnovers are bad for organizations. Turnover is a normal
part of organizational operations; less than five percent turnover is actually
considered unhealthy (Hurley, 2010).

Turnover bargains chance to stay the organization spirited
by introducing workers with new thinking, new skills and traits. It
additionally permits a chance to exchange marginal employees with additional
dynamic employees.

 

2.5    Human Resources (HR) Practices that Contribute
to Turnover

There are several potential causes for turnover;
generally the causes are associated with the human resource practices of the
organization and might be managed. These embody such things as non-competitive
compensation, high stress, operating conditions, monotony, poor direction, poor
relationship between the worker and also the job, inadequate coaching, poor
communications, and different organization practices (Mushrush, 2002). So as to
handle these problems, structure leaders ought to bear in mind of the
requirements and environmental circumstances close to their workers. Most high
level managers take into account retention of the most effective workers to be
a vital a part of their future business strategy. However, several corporations
don’t have a framework in situ to effectively retain their workers (McKeown,
2010). Commitment of the organization, to the worker, may be expressed through human
resource practices and impact retention. High commitment human resource
practices that have an effect on worker commitment include: “staffing, process
appraisal, competitive and equitable compensation, and comprehensive coaching
and development activities” (Whitener, 2001). Considering the substantial
prices related to turnover, employers ought to implement human resource practices
that cut back turnover the maximum amount as attainable.

 

2.6    Differential
Turnover by Position Type

High frequency of ratio could be a downside that
faces many alternative corporations and organizations. The prices transcend
accomplishment, hiring, and coaching of the employee; they embody loss of
productivity. Some organizations are additional acceptive of turnover than
others. For 2006, the overall voluntary turnover for the us was twenty three.4%
(Nobscot Corporation, n.d.). The industries with the 3 highest annual turnover
rates were: accommodation and food service at fifty six percent, leisure and cordial
reception at fifty two percent, and retail trade at thirty four percent. The
industries reportage the 3 lowest turnover rates were: government at eight
percent, academic services at thirteen percent, and finance and insurance at
fifteen percent.

The significant variation in turnover rates from one
trade to a different is also attributed partly to the kinds of positions
obtainable, for example in food and nutrient service, many roles involve
repetitive actions, square measure half time with no advantages, and have few
instructional needs. Coaching for many of those jobs is conducted on the task
underneath shut management by a full-fledged worker and infrequently lasts a
few of weeks or less. Coaching usually covers topics like daily operations,
menu, eating place history, safe food handling and sanitation. employees for
these jobs square measure plentiful and that they tend to be low-skilled, high
school or school age and don’t expect to stay within the position for an
extended amount of your time (United States Department of Labor (U.S. DOL),
2010).

On the opposite finish of the spectrum, there’s a lot
of less turnover within the government and academic services trade that tend to
draw in what’s called an information employee. “An information employee is
somebody World Health Organization is used attributable to his or her
information of an issue matter, instead of ability to perform manual labour.
They perform best once authorized to create the foremost of their deepest
skills” (Serrat, 2008, p. 12).

The government and academic services business employs
a number of the foremost extremely arch and educated staff within the working
class. Concerning sixty four percent of workers have a minimum of a academic
degree. Several skilled occupations additionally need an academic degree or
academic degree, significantly for jobs at postsecondary establishments or in administration.
The positions area unit typically full time with smart advantages and earnings
potential (U.S. DOL, 2010). These positions area unit generally public
positions with answerability to tax payers. Positive relationships with
business and client service area unit vital for continuing public support.
These positions need intensive coaching and investment by the leader. There
also are additional resources invested with within the achievement and hiring
of those workers as a result of the distinctive nature of skilled work. After
they resign, it takes longer to fill the position with a professional
individual as a result of application needs that successively creates
additional loss to the organization in terms of labor productivity.

 

 

2.7     CONCEPTUAL
FRAMEWORK

Turnover in my research will focusing effect by organizational
commitment, job satisfaction, and intention to quit.

 

JOB SATISFACTION

TURNOVER
INTENTIONS

HR PRACTICES
(Recruitment and
selection, evaluation, supervision, training and development)

 

 

 

 

 

 

 

 

   

 

 

 

 

3.    
HYPOTHESIS

H01: There is no significant
relationship between HR practices and turnover intentions.

H02: There is no significant
relationship between job satisfaction and turnover intentions.

 

2.     
    METHODOLOGY

The study is descriptive cum
correlational in nature.

 

 

4.1     POPULATION

Employees of telecom sector (Ufone) are my sample size of
this study.

 

4.2     SAMPLE

The sample of this study will include the employees
working in north region of Ufone.

 

4.3    DATA COLLECTION

Descriptive
study will be conducted using questionnaire. Employees will be given questionnaire
in Ufone (PTML) a telecom operator of Pakistan. Dependent variable is employee
turnover intention. Independent variables are HR practices of recruitment and
selection, evaluation, supervision, training and development, organization
commitment and job satisfaction.

4.4      DATA ANALYSIS

Data will be analyzed by using SPSS
20.