Importance of Employee Retention

(yiftee, 2014)

Employee retention is vital factor for the survival of an organization. This became a challenging one for most of the organization in the current dynamic environment (Ramlall, 2004). Organizations recruit competent employees and, invest time and money for the development of employee. When an employee leaves an organization, there is an associated cost for the organization. But it is difficult measure and value it. Ramlall (2004) stated that the average company loses approximately $1 million with every 10 managerial and professional employees who leave the organization. In other words, when direct and indirect costs are combined, the total turnover cost of a relieved employee is between one and two years’ pay and benefits.

There is substantial economic impact to the organization when losing any of its critical employees. When an employee leaves from an organization, all the knowledge about the company, stake holders, projects etc go with employee to competitor. This is the knowledge that is used to attract and satisfy the desires and expectations of organization’s customers. Toracco (2000) stated that most of the organizations now accepts that the knowledge as one of their most valuable asset, but it lacks a system to retain and control the value of knowledge. Moreover, company must incur additional costs on advertising, screening, verifying credentials, interviewing and training etc. to fill the vacant position.

It is crucial for an organization to develop an environment within the organization to motivate employees to stay in the organization. Motivation as defined by Robbins (1993) is the “willingness to exert high levels of effort toward organizational goals, conditioned by the effort’s ability to satisfy some individual need”. According Yamamoto (2011), unsatisfied needs drive the individuals. These unsatisfied needs make individuals to find alternative ways to satisfy them (eg: finding new jobs etc).

There are various human resource practices employed by the organization to retain the employees (Khan et al., 2014). The HR must know how to attract and keep good employees because these are the employees who can make or break the organization’s goodwill (Wisnefski, 2008). According to Haider et al. (2015), the decision of an employee to stay in the organization is mainly influenced by;

• Personal factors (individual’s age, the family situation etc )
• Opportunities for training and career development
• Networking, external job market or job title
• Remuneration and employee benefits

Conclusion

Talented and good employees are asset of an organization. Retaining talented employees is highly important for the long-term growth as well as success of the business. Thus, it is necessary to retain the talented employees not because of the costs incurred on them by employers, but also because of the required output they give to the organization.

References

Haider, M., Rasli, A., Akhtar, C., Yusoff, R., Malik, O. and Aamir, A. (2015) 'The Impact of Human Resource Practices on Employee Retention in the Telecom Sector', International Journal of Economics and Financial Issues, 5(Special Issue), pp.63-69.

Khan, F., Yusoff, R.M. and Khan, A. (2014) 'Effect of human resource practices on job satisfaction in Pakistan', Sains Humanika, 1(1), 5.

Ramlall, S. (2004) 'A Review of Employee Motivation Theories and their Implications for Employee Retention within Organizations', The Journal of American Academy of Business, Cambridge, (September), pp.52-63.

Robbins, S. (1993) Organizational Behavior. Sixth Edition. Englewood Cliffs: Prentice-Hall.

Torraco, R. (2000) 'A Theory of Knowledge Management', Advances in Developing Human Resources, 2(1), pp.38-62.
Wisnefski, M. (2008) 'Employee retention in the new millennium', Business Services, 16(3), 465-507.

Yamamoto, H. (2011) 'The relationship between employee benefit management and employee retention', The International Journal of Human Resource Management, 22(17), 3550-3564.

yiftee (2014) Keys to Retaining your MVPs. Available at: https://yiftee.com/keys-to-retaining-your-mvps/ (Accessed: 31 Oct. 2019).

What is Behavioural based interview?

(AMS International, 2019)

Recruiting the right talent into an organisation is a challenging process. With the advancement of technologies humans have become more complex such that most of the talent screening methods do not reveal the real traits of a candidate. Interview is considered as the most important step in the talent recruiting process and it is a discussion between recruiters and a candidate with an intention (Bingham & Moore, 1931).

According to Swider et al. (2015), before starting the recruitment process, the human resource department should evaluate the requirements such as qualification, experience, skills, attitude etc needed for the position to be filled. Interviews can capture and obtain adequate information about the candidate’s knowledge, skills and experience (Callaghan and Thompson, 2002). But, critical elements of an interview for selecting a right candidate are attitudes, which are tough to recognize in normal short interview (McCarthy et al., 2013).

As Buang et al. (2018) stated, there are two interview methodologies

1. Traditional interview
2. Behavioural based interview

TRADITIONAL INTERVIEW

According to Kiviat (2009), a face to face or non-face to face interviews can be conducted in this method. Interview questions can be organized, semi-organized or open ended (Bragger et al., 2002). Candidates can be familiarized with the interview process by practicing or performing mock interview (Hartvigsson & Ahlgren, 2018). Therefore, Huffcutt et al. (2017) concluded that the traditional job interview is a poor forecaster of on job performance.

BEHAVIOURAL BASED INTERVIEW

After identifying the disadvantages of traditional interview method, behavioural based interview method became famous. This method helps employers to predict how would candidates perform on the job, by assessing candidate’s experiences and behaviour in the interview (Buang et al., 2018).

Altmaier et al. (1992) said that traditional interview only backs a small percentage of on the job behaviour. On the other hand, behavioural interviews predict 55% of job behaviour. Traditional interviews have common questions like “Tell me about yourself”. Candidates can mislead the interviewer and tell only what interviewer likes to hear. But, in behavioural interview, certain scenarios could be further analysed to get broader knowledge about the candidate. For eg: “What made you to make that decision?”.

In summary, behavioural based questions are more challenging and difficult to mislead. Therefore, a correct set of questions would reveal the true nature of the candidate. 

References;

Altmaier, E. M., Smith, W. L., O'halloran, C. M., & Franken, J. E. (1992) 'The predictive utility of behaviour-based interviewing compared with traditional interviewing in the selection of radiology residents', Investigative radiology, 27(5), 385-389.

AMS International (2019) Are you prepared for a Panel Interview?. Available at: https://www.ams-int.com/prepared-panel-interview/ (Accessed:29 Oct. 2019).

Bingham, W. V. & Moore, B. V. (1931) How to interview. Oxford, England: Harpers.

Buang, A., Seng, L. C. & Sum, L. W. V. (2018) 'The needs of Change in Job Interview: Compassionate Assessment and Interview', Open Journal of Human Resource Management, 1(1), pp. 30-37.

Callaghan, G. & Thompson, P. (2002) '“We recruit attitude”: the selection and shaping of routine call centre labour', Journal of Management Studies, 39(2), 233-254.

Hartvigsson, E. & Ahlgren, E. O. (2018) 'Comparison of load profiles in a mini-grid: Assessment of performance metrics using measured and interview-based data', Energy for Sustainable Development, 43, 186-195.

Huffcutt, A. I., Culbertson, S. S., Goebl, A. P. & Toidze, I. (2017), 'The influence of cognitive ability on interviewee performance in traditional versus relaxed behavior description interview formats', European Management Journal, 35(3), 383-387.

Kiviat, B. (2009). How Skype is changing the job interview. Time, Oct, 20.

McCarthy, J. M., Van Iddekinge, C. H., Lievens, F., Kung, M. C., Sinar, E. F., & Campion, M. A. (2013), 'Do candidate reactions relate to job performance or affect criterion-related validity? A multistudy investigation of relations among reactions, selection test scores, and job performance', Journal of Applied Psychology, 98(5), 701.

Swider, B. W., Zimmerman, R. D. & Barrick, M. R. (2015) 'Searching for the right fit: Development of applicant person-organization fit perceptions during the recruitment process', Journal of Applied Psychology, 100(3), 880.