CHAPTER 1: INTRODUCTION
1.1 Background
The labour market is greatly influenced by the changes that occur within its environment. At present, more and more companies are employing market-like mechanisms or practices in managing their respective human resources. One of the main reasons for this transition is the realization of companies with regards to the essential contributions their people resources can generate; business and workplace organizations have become more aware that human resource are unique competitive advantages that should be given due consideration.
Along with the transition of industrial relations, the management of labour force or workforce followed suit. The world of labor and employment that used to be dominated by the principles of strategy, structure and system had changed with the times. Within the workplace, people in the organization forms a bond as they work together towards the achievement of a common objective. Thus, communication between these people becomes important. However, it is also natural for people to have varied beliefs and objectives that are different from those established by the corporation. In order to remedy this work situation, the organization must make it certain that the goals of the corporation are met in such that the employees do not feel deprived of their own personal objectives. Organizations saw leadership and motivation as the solution for this.
Thus, work organizations now view labour force management as not just a system for managing its workforce but a strategic perspective that enables the goals of both employers and employees to meet towards achievement (1996). According to (1999), employee relation problems have been predominant during the earlier times as employers tried to work out the general management problem without the facilitation of labour force strategic approach.
Management is by definition the labour force management. This is because both concepts require the coordinated action of both employers and employees. Perhaps, the transition of labour force strategic management from personnel management is the most important of all for employers and labourers. From being focused only on the welfare of the employees, Employee management has improved its goals and purpose through managing people in such a way that all the goals of the people within the organization are met and achieved. Through human resource management, employees are also provided with intrinsic and extrinsic rewards ( 1997).
As noted by (1993), managing labour forces used to be insignificant for work organizations. However, the role and purpose of human managing strategically the labour force or the workforce now becomes highly recognized as an important business concern. The focus of the management used to be on the mere security of compliance among employees. Nowadays, the focus is more ambitious and is geared towards winning commitment.
Accordingly, the workforce or labour force is a group within the organisation that is undeniably one of the most important factions that contributes to its success. A business cannot exist without financial capital, but it also can never exist without human capital ( 2003). It is the employees who work for the company, performs the necessary tasks to make the company function, and are responsible for the profit and growth of the company (2000). With such great roles and responsibilities tasked to the staff/employees, they are being kept by the company through strategic compensation and benefits schemes. However, are compensations and benefits enough to make employees perform everything they can? Making employees give their best on their job and tasks is perhaps one of the most challenging endeavours that the company should perform. Employees can do many things during work that may disrupt or support the attempts of the company to earn money. Company should always give the effort to motivate their employees. Motivating employees means empowering them to lead the company into the path of competitiveness ( 2001). Motivation or empowerment of employees is important to give the employees enough reason to stay in the company (1999).
1.2 Research Purpose
1.2.1 Background of the MBH-Joint Venture
The organization of MBH-Joint Venture is an “inter-organizational structure” of three legally independent corporations (Maeda Corporation, Barbican Construction Company Limited and Hsin Chong Construction Company Limited) joining together in formation of a new company. It is solely for the management and implementation of the construction of several flyovers over 3 km long which connects Tai Po Road to Route 8 for routing traffics from the New Territories through Tai Wai and Shatin New Town (a common goal). The organization includes the alliances of three major companies, namely: Maeda Corporation, Barbican Construction Co. Ltd., and Hsin Chong Construction Co. Ltd. From the date the project was awarded in March, 2003, it has been the goal of the MBHJV to complete the whole Road T3 construction and the associated roadwork by December, 2007.
In MBH Joint Venture, the staff/employees are their general representatives who basically give out everything they can. They are the great contributors and they set the path for MBH’s success. With this regard, the employee and employer relationship would not be able to function without wages and compensation.
1.2.2 Existing Problems within MBH Joint Venture
The organisational background presented several issues that only emphasises and stresses the need for a study in determining strategies of MBH Joint Venture in the retention of staff. So far, the strategies usually employed are large bonuses, promotions and salaries but these are hardly enough to keep the employee within the doors of the firm.
The studies mentioned earlier agree that employees need to be provided continuous opportunities for growth and development through an acquisition of the newest and latest skills and knowledge. This will only be possible if they are subjected to constant education and training in which some of the non-monetary strategies that this study would bring to mention and tackle in order to determine the sufficiency of such strategy in maintaining and retaining MBH’s top talents to meet the project target and quality improving.
This research study only covers the strategies of MBH in retaining their staff in order to meet target goal and quality improving. The outcome of this study is limited only to the data gathered from books and journals about employee/staff retention, HRM, motivation, and from the primary data gathered from the result of the questionnaire survey and interview that were conducted by the researcher.
1.2.3 Employee Turnover and Retention
The rotation of workers around the labour market, may it be between firms, jobs and occupations, or between the states of employment or unemployment, is called as turnover ( 1998). Accordingly, turnover is one of the most significant causes of declining productivity and sagging morale in both the public and private sectors ( 2000). Excessive turnover may lead to jeopardy of the organisation’s objectives and may negatively affect innovation and cause major delays in the delivery of services and introduction of new programs. It may also lead to loss of key employees, which, in turn may have negative impact on the quality and innovation of services delivered, which in turn, may negatively affect the satisfaction of customers of some departments or government agencies. For some government agencies or departments, customers include not only those people who consume services, but also the employees working in their offices ( 2000).
Retention of skilled employees is obviously important. They function well and stand out among the others. Furthermore, retentions save the company additional expenses. A company loses approximately $1 million with every 10 managerial and professional employees who leave the organisation (1997). A company also loses critical knowledge necessary for better performance when a skilled employee decides to resign. Skilled employees are badly needed because they rarely come. If the training was provided by the organisation, the turnover of skilled employees would just put the training expenses into waste. Furthermore, the mobility of the company is affected greatly because every turnover puts tasks left behind by the employee into a halt. Even if there would be a temporary substitute before a new employee is hired, it is unsure if the substitute would perform the task faster and efficiently. Then, the hiring process also wastes a considerable amount of time. It also brings additional costs in advertising.
1.2.4 Employee Motivation
(1992) stated that skills, knowledge and experience represent capital due to the reason that they enhance productivity. Companies invest in skills training and development to be competitive, but the failure to manage the person trained could be considered a great setback. Employee retention is basically essential in grasping a complete return on investment. Based on the human capital theory, it is imperative that companies invest in skills training and development, but they should also align the compensations and benefits of the person with his or her achievements. In the case of our company, there is obviously a lack in recognizing the achievements of skilled employees. Without recognition and growth, there is no reason for the employee to carry on his good performance, or worse, to continue his service to the organisation (1992).
Motivation can be assumed as the reason or the force behind why a person does what he or she does. Sometimes, it is also a means to make the person perform better and more efficient. Basically there are three assumptions in human motivation established in research. The first one assumes that motivation is inferred from a systematic analysis of how personal, task and environmental characteristics influence behavior and job performance (1997). The next one infers that motivation is not a fixed trait; but rather it refers to a dynamic internal state resulting from the influence of personal and situational factors (1997). This means that motivation may change with changes in personal, social or other factors ( 1997). Finally, motivation affects behavior, rather than performance ( 1995; 1997). Wiley explained: “Initiatives designed to enhance job performance by increasing employee motivation may not be successful if there is a weak link between job performance and an employee’s efforts” ().
(1999) defines motivation as ‘the degree to which an individual wants and chooses to engage in certain specified behaviors’. From this theory, (1999) identifies four common characteristics which underline the above definition of motivation:
· Motivation is typified as an individual phenomenon. Every person is unique and all the major theories of motivation allow for this uniqueness to be demonstrated in one way or another.
· Motivation is described, usually, as intentional. Motivation is assumed to be under the worker’s control, and behaviors that are influenced by motivation, such as effort expended, are seen as choices of action.
· Motivation is multifaceted. The two factors of greatest importance are (i) what gets people activated (arousal); and (ii) the force of an individual to engage in desired behavior (direction or choice of behavior).
· The purpose of motivational theories is to predict behavior. Motivation is not the behavior itself, and it is not performance. Motivation concerns action, and the internal and external forces that influence a person’s choice of action ( 1999).
From the definitions mentioned, it can be analysed that motivation is necessary for the growth of the employee in the organisation. The employee starts his career through learning, basically the culture of the organisation and his responsibilities. Motivation is a vital element to learning because if an organisation does not possess the ability to motivate its employees, the knowledge within the organisation is not practically used to the fullest (1999). Thus, in every successful learning organisation, finding the factors that will motivate its employees to partake in continuous learning and to take advantage of this knowledge, accordingly, becomes their aim ( 1999).
1.3 Value and Justification of the Study
Employee retention has been mentioned as one of the most debatable topics when it comes to managing human resources. As mentioned, MBH Joint Venture is a company which has been established by three legally independent corporations which unite to for MBH. With the joint venture that occurred, the company has encountered problems on retaining their employees to pursue their business objective. The problem faced by the management of MBH Joint Venture is regarding the idea of retaining or maintaining their employees. Herein, the company is considered to have specific and effective employee retention strategies that would adhere to the needs of maintaining efficient and deserving employees the meet the company’s project target and for quality improving. In this regard, MBH Joint Venture is in need of new employee retention strategies to ensure that their employees would be able to become more productive and helpful in enhancing company performance.
The goal of this MBH Joint Venture study is to better comprehend the value of employee retention to enhance organisation performance and to provide organisations with data on how to improve their staff retention strategies. This study is important to ensure that MBH Joint Venture will be able to be benefited from retaining or maintaining their employees.
1.4 Research Objectives
Primarily, the main objective of this paper is to determine the most appropriate and effective retaining and maintaining strategies of MBH’s staff in order to meet their project goal and quality improving. Specifically, the aims are:
· To analyse the human resource strategy of MBH in terms of employee retentions.
· To identify the problems regarding the current employee retention strategy of MBH Joint Venture
· To determine if there is a significant impact to the performance of the MBH
· Suggest appropriate strategies to improve employee retention and motivation
1.5 Research Questions
The fast paced business world is affecting companies left and right. With this ever changing business environment, companies have to adjust in order to be able to remain competitive. One way of maintaining a competitive edge is retaining and maintaining staff/employees. Specifically, the study is set to answer the following questions:
Ø Why do MBH Joint Venture retains their staff?
Ø What are the retention strategies that are being instituted in MBH Joint Venture?
Ø What are the problems of the current retention strategy of MBH?
Ø What is the effect of employee retention to the organisational performance of the company?
Ø Is staff retention has significant impact to the performance of the MBH?
1.6 Research Hypothesis
It is assumed that staff retention in MBH affects their capabilities to meet the project target and quality improving. However, retention of staff may produce a positive or negative effect to the company. Furthermore, it could be beneficial or will not produce benefits for the company. This study would like to test the following null hypothesis:
l “Employee/Staff retention has no significant effect on the performance of MBH Joint Venture.”
1.7 Conceptual Context
1.7.1 Relationship to Previous Work
According to (2004), employees basically refer to people who work for another in return for wages or salary. Legally, an employee is referred to a person hired to provide services to a company on a regular basis in exchange for compensation, and who does not provide these services as part of an independent business (2004). However, (2004) stated that employees are more than any of those definitions. Employees are the lifeblood of the organisation because they are the ones who provide products and services that define corporations, organisations and government entities (2004). They are referred to as the most precious assets of the organisation because without them, the organisation is crippled and cannot function effectively.
From the study of (2004), it is very necessary for any organisation to maintain their employees. Because of the important role of employees, organisations like MBH Joint Venture have the responsibility to motivate them so as they can function more effectively. Theories of motivation such as Maslow’s theory, Alfelder’s theory, McClelland’s theory, and Herzberg’s theory (1999) explain why employees should be motivated and why organisations should take this concept into consideration. But what really constitutes effective employee motivation? Several research and organisational reports point positive communication as one of the most important factors that build effective employee motivation. For instance, (2005) cited a couple of organisational research by General Electric and Hewlett-Packard in the eighties that concludes: “The better the managers' communication, the more satisfied the employees were with all aspects of their work life”. Building a positive communication with employees is important because they are the organisation’s best ambassadors or loudest critics, depending on how fast they get relevant information and the context in which it is received ( 1998). Information consistency affects the success of the company and if it fails to communicate information internally and externally, the reputation of the company may fall. Communication basically uplifts the morale of an employee as it makes them feel that they are valued by the organisation. This also builds employee loyalty and satisfaction. As (1990) have mentioned that employers are becoming more aware that employee loyalty, commitment, and concern for quality depend on effective employee communication. On the other hand, employee motivation in itself has become a history of psychological strategies in encouraging the employee into producing the maximum output possible. These psychological conditions had been the goals of business managers and scholars since time in memoriam. The roots to organisational productivity and competitiveness really spring from human behaviour and tendencies and thus to achieve these is to optimise employee performance. According to (1998), Employee performance is frequently described as a joint function of ability and motivation, and one of the primary tasks facing a manager is motivating employees to perform to the best of their ability Motivation can be described as the driving force of individual behaviour to fulfil needs or achieve goals (1998).
In a capitalist economy, both employers and employees have learned to rely on monetary benefits as the sole reward system and primary means to hire and retain a professional (2000). It may be even said that it is salary, wages or cash flow among other monetary incentives is central to the employment system in general. This alone however, would not be enough to motivate employees; and in fact, non-monetary methods such as bigger job scope, revised roles and responsibilities, training and development opportunities will make employees to become more happy, enthusiastic and devoted to work that would in turn translate itself to optimise productivity which will beneficial to the firm.
From the outcome of these previous studies, the psychological satisfaction may be regarded as the kind of compensation that would include “opportunities to perform meaningful work, social interactions with others in the workplace, job training, advancement possibilities, recognition, and a host of similar factors” which is also apparent to most business organisations today such as MBH Joint Venture. In order for a compensation system to be effective, this element would need to be present. Non-monetary gains should actually be interrelated with monetary gains. It has been a misconception that retaining employees is only through monetary or financial incentives. According to (1999; ) the general impression of managers is that they expect employees to demand promotion or salary increase. They fail to notice that what the employees actually desire more importantly in order to become more motivated are “additional recognition, more satisfying assignments, and increased feedback”. There are such things as the maintenance of morale which in itself is important for top quality employees and their retention. On the other hand, (2000) stated that most managers believe that they may maintain their top employees through salary increases but it is only one of the ways to retain them and in fact, it is a very insufficient manner in retaining them.
1.7.2 Scope and Limitations
Based on the performances and achievements accomplished by the workforce in a particular organisation, an individual or group’s morale, self-esteem, confidence and drive is enhanced and heightened which proves to be healthy for the efficient and productive function of the workforce and the organisation in general. Morale likewise serves as a motivation for people to work at their best which not only benefit them as independent beings but also as part of a complex system. Performance quality is highly correlated with the appreciation a person garners from his or her colleagues and supervisors which at the same time serves as a personal evaluation of one’s capabilities.
By nature, human beings are highly-self motivated. They take into account their capabilities in performing their duties and responsibilities. Self-motivation and self-control directs and greatly influence every action that they intend to take. Making oneself stand out from the rest drives an individual to assert oneself and take a position that he or she believes in. The diverse traits and characteristics that make up the personality of a person make one’s existence and behavior a complex and highly interesting. The complicated nature of a person serves as a basis on how one will react and treat things and events in order to achieve an objective. The precise and rational thinking of people motivates them to behave toward a goal. These characteristics classify human beings more than resource of production which the human relations studies recognize and uphold.
The study intends to investigate the employee retention strategies of MBH Joint Venture and to known whether this has significant impact to the company’s performance. For this study, primary research and secondary research will be used. Primary research will be conducted using anonymous questionnaires that will be sent to selected employees of MBH Joint venture. The questionnaires will be used to collect quantitative data and the interviews will be used to provide qualitative insights into the data collected.
The data will be analysed and compiled for the correlation of the hypothesis. The data will then be presented by means of graphical representations and illustration and the difference would be highlighted. A negative correlation between the variables would suggest that the hypothesis is null, that is, the level of effectiveness of training programs significantly affects the general efficiency of the organisation.
Further, this dissertation will be quantitative and qualitative in nature. The model of this dissertation will be based on the Input-Process-Output Model; a process is viewed as a series of boxes which are known as processing elements and connected by inputs and outputs. Data or information flows through a series of tasks or activities based on a set of rules or decision points. In IPO model, flow Charts and process diagrams are often used to present such process. Basically, what goes in is the input or those data that have an impact in the process and the output (the result). See Figure 1.1 (Basic IPO Model).
Figure 1.1
Input – Process – Output Model
The IPO model will show the general structure and guide for the path of the dissertation. Substituting the variables of this research study on the IPO model, the researcher came up with the following:
Figure 1.2
Conceptual Framework
INPUT PROCESS OUTPUT
CHAPTER 2: LITERATURE REVIEW
2.0 Introduction
This part of the paper will provide discussion of literatures relevant to the topic of the study. The literature will include the concept of HRM, employee performance, employee empowerment and development, workplace culture, Employee retention and others. The main focus of this literature review is with regards to strategies that can be used by company to retain staff. In addition, motivation theories will also be given consideration in this area.
2.1 Human Resource Management
It is said that the philosophy of human resource management is based on the simple belief that human resources are the most important asset in achieving and sustained business success. This realisation became the driving force behind the creation of human resource management resulting in organisations taking a strategic approach to the management of their people.
The true worth of human resource management is becoming more widely understood as human resource management steadily interweaves all aspects of people management and development within the company (1995).
Human resource management (HRM) is known and accepted in the broadest sense of the term, as a form of management that includes “all management decisions and actions that affect the nature of the relationship between the organisation and the employees – its human resources” (1984). The tasks of those belonging in HRM can be complex as it involves all issues that encompass employee and firm relationship. Today, it can be said that role of HRM in the organisation has been expanded and improved as new ways to handle employees are discovered.
Believing that the most important asset of a business is the people in order to achieve sustained business success is the core philosophy of human resource management (HRM). Realizing this leads to a strategic management of people within the organisation. Its philosophy is based on the simple belief that human resources are the most important asset in achieving and sustaining business success. Human resource professionals basically deal with such areas as employee recruitment and selection, performance evaluation, compensation and benefits, professional development, safety and health, forecasting, and labor relations ( 2001).
2.2 Employee Performance
According to (1998) ensuring employee performance requires establishing a level of competence which the employee should be aware of as a target to be achieved. This is the measure to be used by managers in determining compliance with the standard and in identifying problems met by the employees in meeting the standard. In developing a training program to enhance the productivity of employees the manager will look at the competency problems of the employees and fashion the program to enable the employees to reach and even exceed the competency standard established for their work. This requires a great amount of perceptiveness on the part of the manager in determining what method of training will be most effective in improving employee competence. Some of the training includes computer software training, internet-based training and self teaching by encouraging innovativeness in the workplace (1998).
A considerable number of companies have developed into an essential part of the period of global competition, increasing development, improved business paradigms, and corporate reorganisation. The continuing transformation from the traditional industrial framework with its hierarchical companies to a worldwide, knowledge-founded financial system and intelligent corporations, altering ideas regarding the social contract involving employers and employees, an progressively more adaptable pool of talent and a body of workforce, necessitates human resource (HR) purposes to realign and relocate itself in the vicinity of these drivers. (1964) had defined three approaches to organisation, which includes structure, technology and people. New formal guidelines and procedures like organisation chart, budgeting methods, rules and regulations can also be structural approaches on inducing change. On the other hand, rearrangements in work flow through new physical layouts, work methods, job descriptions and work standards can be done as technological approaches (1964).
Modern organisations passed by the guild structures and as organisations grew larger, skills become increasingly fragmented and specialised and positions become more functionally differentiated (1996). As such organisations should stress on people approaches which includes alterations in attitudes, motivation and behavioral skills through new training programs, selection procedures, and performance appraisal schemes. Indeed, making a business successful in a particular setting demands crucial and detailed studies and examination of the factors that will generate the best results that will serve the aims and objectives of the company.
2.3 Motivation Theories
There are two types of rewards systems which are financial rewards and non-financial rewards. It was also shown that the effectiveness of the reward system is affected by different kind of motivators. Motivation is an important element to every organization, as this could affect the productivity and the morale of the staff. Lack of motivation will cause high staff turnover, high rate of absenteeism, poor performance, not willing to attend the training course, etc. If the managers understand the employee’s underlying learning motivator, it can improve the customer satisfaction in the long run (1995). It is the role of management to implement different kind of rewards system or recognition system in order to maintain the morale. (2000) stated that “motivation is a process not a result” (). By understanding the motivation theories, it also assists management to prepare a better structure of training planning and design in an organization. It is fundamental to understand the motivation factor in order to examine the relationship between rewards system and learning attitude of the people.
There are different perceptions and definitions of “motivation”. Some people might think that motivation is a view of personal trait as some have or some might not have it ( 1998). Motivation can be defined as the willingness to exert high levels of effort toward organizational goals, conditioned by the effort’s ability to satisfy some individual need ( 1998).(1993) also defined motivation will cause people to act or behave in certain ways. Furthermore, defines motivation as ‘the degree to which an individual wants and chooses to engage in certain specified behaviors’ ( 1999). From this theory, Mullins identifies four common characteristics which underline the above definition of motivation:
- Motivation is typified as an individual phenomenon. Every person is unique and all the major theories of motivation allow for this uniqueness to be demonstrated in one way or another.
- Motivation is described, usually, as intentional. Motivation is assumed to be under the worker’s control, and behaviours that are influenced by motivation, such as effort expended, are seen as choices of action.
- Motivation is multifaceted. The two factors of greatest importance are (1) what gets people activated (arousal); and (2) the force of an individual to engage in desired behaviour (direction or choice of behaviour).
- The purpose of motivational theories is to predict behaviour. Motivation is not the behaviour itself, and it is not performance. Motivation concerns action, and the internal and external forces that influence a person’s choice of action.
From the definitions mentioned, it can be analysed that motivation is necessary for the growth of the employee in the organisation. The HR manager evaluates and motivates its employees. It is believed that motivation is the key to beneficial retention of employees to work and to like their work. The theories of motivation gave some ideas of how a motivation program can be implemented within an organisation. This can be started by surveying the employees and ask them what they think about the company. Through research conducted by the manager, the basic needs of employees can be identified and satisfied through the development and implementation of motivation programs. The initial act that should be done is to make employees realise their personal worth by empowering them. For instance, employees should be given the freedom to voice out their opinions, although there should be a standard on how conversations should be ethically observed, as well as respect to superiors. Former General Manager of General Electric, uses this approach to empower employees. Through this, little and huge issues that affect employees everyday work behaviours were identified and solved (1998). This is fundamentally a great way to identify employees’ needs.
On the other hand, leadership also plays a fundamental part in motivating employees. Today, leadership serves as a critical element of organisational success. In motivating employees to learn, leaders must set a way towards a given goal, inspire, or motivate them to follow (2003). The HR manager should know how to recognise success and how to praise those who deserve praises. Several studies found positive linkage between leadership styles and job satisfaction, except for the initiating structure leadership style, which similarly shows negative effect on job satisfaction (1993; 1997). Deserving employees can be effectively praised and recognised through awards and bonuses. Developing a program were a particular employee with good performance would be branded as employee of the week can also be a good idea. Of course, this should also come with small rewards to make employees feel that their efforts pay off.
Further, motivation is the interaction between the individual and the situation. Under different situations, individual will respond differently. It all depends on the individual motivational drive or individual needs and varies from situation to situation (2001). It also leads motivation treated as a need-satisfying process; an unsatisfied need creates tension that stimulates drives within the individuals. These drives generate search behaviour to find particular goals that, if attained, will satisfy the need and lead to the reduction of tension (1998).
Figure 2 Motivation Theory
To understand better the various terms and forms of motivation to learn, it is useful to review different kinds of motivational theories in this chapter. There are several types of motivation theories. Among these, the best-known and most typical examples are Maslow’s hierarchy of needs, Herzberg’s motivation and hygiene factors, McClelland’s three needs theory and Vroom’s expectancy theory ( 1964). These are used on this research because of their proven relativity and applicability to the concept of this research. Also, they are the most common theories in relation to employee motivation and reward system.
2.3.1 Maslow’s Hierarchy of Needs
Abraham Maslow (1943 was a psychologist and one of the most well-known motivation theories is Hierarchy of Needs. (1998) mentioned that Maslow generalized that every human beings exists a hierarchy of five needs, which are:
In order to apply an appropriate rewards system in an organization, it is essential to understand the idea of human needs and Maslow’s hierarchy of needs can reflect the five general human needs. The figure below illustrates the graphical representation of the most popular motivational model – Maslow’s hierarchy of needs.
Figure 2.3.1 Maslow’s Hierarchy of Needs Model
This theory is based on a progression hypothesis and it called content theory. Content theory seeks to examine the specific factors that motivate behaviours. In Maslow’s theory, people progress up the hierarchy as they successively gratify each level of need. On this research, this theory will serve the purposes of relating the need of motivating people to learn.
2.3.2 Herzberg’s motivation and hygiene factors theory
Motivation-hygiene theory was proposed by another psychologist Frederick Herzberg. It emphasised that the needs satisfactions are categorized into intrinsic and extrinsic factors. According to (1993), motivation can take place in either intrinsic motivation or extrinsic motivation:
Intrinsic motivation – the self-generated factors and influence people to behave in a particular way or direction. Intrinsic factors motivate us from within personal interest, desire and fulfilment. It has long-term and deeper effect.
Extrinsic motivation – To satisfy indirect or instrumental needs. It arises from some kind of ‘Do this’ and you will get that motivation (2001). It has an immediate and powerful effect but will not last long.
To a certain extent, part of the Herzberg’s theory is parallel to Maslow’s theory. It can be seen that the hygiene factors in the lower levels of Maslow’s hierarchy and the motivators in the higher levels. However, unlike Maslow’s hierarchy of needs, Herzberg’s two-factor theory argued that individual needs satisfaction does not process in a hierarchy.
The motivation-hygiene theory needs to hold management not only to provide hygiene factors and avoid employee dissatisfaction, but also provide factors intrinsic to the work itself in order for employees to be satisfied with their jobs. It can be argued that it does not mean that the employee is motivated to learn. From Herzberg’s theory, it encourages the organisation to enlarge and enrich work responsibilities and pay more attention to goal-setting, appraisal, reward and recognition system.
2.3.3 McClelland Three need theory
McClelland’s theory of needs that focuses on three needs: achievement, power and affiliation. Need of achievement means people are striving personal achievement rather than the rewards. People are highly motivated by challenge and competitive work situation (1995). Need of power is the desire to have impact or influence or control others. Need of affiliation is the desire of friendship; prefer to keep good relationship instead of competitive environment (1998). In McClelland theory, it contends that people with a high need for achievement make good managers. For instance, people with high need for achievement will eager to obtain feedback on their performance, willing to solve problem and exhibit moderate levels of risk taking (1994). In view of Herzberg and McClelland’s motivation theories, it shown that both theories are not defined ‘money’ as motivator. It means financial rewards are not the key motivation factor. On the other hand, (2000) disagreed that the need of affiliation is more important than monetary rewards.
2.3.4 Vroom’s Expectancy Theory
While it was discussed in the performance-related pay rewards in the previous chapter, it stated that the staff’s expectancy cannot be ignored. Therefore, Vroom’s expectancy theory will be discussed in the following section. This theory is focused on the personal perceptions and it can reflect the individual concept instead of only concentrated on the monetary reward.
Vroom’s expectancy theory of motivation focuses on personal perceptions of the performance process, ‘the more motivated the worker to perform effectively, the more effective his performance’ (1970:229). Expectancy theory argues that the strength of an expectation that the act will be followed by a given outcome and on the attractiveness of that outcome to the individual (1998). Expectancy is the belief that effort leads to performance, for example, ‘If I try harder, I can do better.’ It reflected this theory focuses on the following relationships:
1. Effort – Performance relationship – Individual perceived that exert a certain amount of effort will lead to performance
2. Performance – Reward relationship – Individual believes that achieve the certain performance level will lead to attainment of a desired outcome
3. Rewards – Personal goals relationship – Organizational rewards satisfy individual personal goals or needs
Figure 2.3.4 Vroom’s Expectancy Theory Model
According to the expectancy theory, employees expect and need to be rewarded according to the work they do, and will help them to develop their capability, help them to work up to a higher level so that they can be better rewarded ( 2002:). Employees expect organisations to have compensation systems that they perceive as being fair and commensurate with their skills and expectations. The compensation may, in some cases, act as employee motivators. These compensations that employees receive may be value-added compensation including direct compensation, such as salary, incentives and commissions; and indirect compensation, such as insurance benefits, employee recognition programs, flexible work hours, and vacation benefits.
Similar to Maslow’s theory of needs hierarchy, the expectancy theory may also be applied in the organisational context. More specifically, it could possess vital implications with regard to corporate reward system as according to (2001):
Ø a clear connection between rewards and performance must be determined,
Ø the connection between rewards and performance must be relayed to the human resources,
Ø the rewards must be provided based on performance,
Ø the rewards must fulfil the specific needs of the employees so as to draw out a high level of motivation, and,
Ø barriers in organizations that hinder excellent performance must be eradicated to ensure motivated behaviour.
If the staffs in an organisation believe that it needs to put effort and lead to performance in order to achieve certain rewards and personal goals, reward system could motivate them to learn.
2.3.5 Motivation and Employment Performance
According to (1998, 21), employee performance is frequently described as a joint function of ability and motivation, and one of the primary tasks facing a manager is motivating employees to perform to the best of their ability. As stated, motivation can be described as the driving force of individual behaviour to fulfil needs or achieve goals. (1994), defines motivation as the "degree to which an individual wants and chooses to engage in certain specified behaviours“. In terms of this definition, various theories have been developed around. These include firstly, the early theories of motivation such as Maslow's hierarchy of needs and Herzberg's two-factor theory of motivation or motivation hygiene theory, and secondly, contemporary theories such as McClelland's theory of needs, cognitive evaluation theory, Alderfer's ERG (existence, relatedness and growth) theory, equity theory, Vroom's expectancy theory, and the reinforcement theory ( 1998). All these theories of motivation are usually divided into two contrasting approaches: content theories and process theories.
Literatures deal with the notion of motivation primarily in terms of intrinsic and extrinsic motivation, or physiological and social motives. Intrinsic motivation is related to 'psychological' rewards such as job content, a sense of achievement, recognition, advancement, a feeling of competence, opportunity for growth and responsibility ( 2002). (1985) suggest that intrinsically motivated behaviours represent the prototype of self-determined activities: They are activities that people do naturally and spontaneously when they feel free to follow their inner interests. This indicates an impressive shift in attitudes towards work, from work as a means of survival to work as a means of enhancing self-development and self-expression. The consequent needs of intrinsic motivation can be explained by Maslow's hierarchy model. It is also supported by Herzberg's Motivation-Hygiene Theory. His theory points that employees are motivated by their own inherent need to succeed at a challenging task. The manager's job, then, is to provide opportunities for people to be motivated to achieve. Herzberg's survey of US workers clearly indicates that about 80% of the factors in satisfying job opportunities come from the intrinsic elements of the job such as achievement, recognition, and the work itself (1982). Inherent needs mean individual differences that affect the degree to which people will experience need satisfaction in different contexts. (1985) assessed individual differences in need strength and used that as the primary basis for predicting behaviour. Therefore there is a need to use both characteristics of the social environment and individual differences to predict people's need satisfaction and, in turn, the quality of their experience and behaviour. Comparing with intrinsic motivation, extrinsic motivation is more related to 'tangible' rewards such as salary, security, promotion and work environment, etc. (2002). External motivators include strategies and incentives, which are designed by the organisation to motivate employees and influence their work behaviour. An employee could get improved motivation from the good relationship with his boss or recognition from his manager, thus result in high performance. But it is unlikely that management and employees will always agree on a reward system based on subjective issues such as 'good interpersonal relations', 'appreciation of work done', or a 'feeling of being in on things' ( 1998) without any tangible reward system, e.g. monetary reward system. To employees in the organisation, it is not only the material value of the reward, but also the boost in self-esteem that public recognition associated with monetary reward affords ( 1996). This also holds true with the matter of job security. Security encompasses more than the employees' financial needs: it relates to their physical, emotional and familial well being (1990)
As workforce reductions are becoming commonplace nowadays, job security is of increasing importance to employees. Employees' reactions to the lack of job security vary. Individuals may experience severe psychological reactions to job loss and/or the threat of job loss. Low self-esteem, low self-confidence, social isolation, anxiety and powerlessness may be results of possible psychological reactions. These reactions extend beyond actual job losers to their colleagues; also affect the organisation morale because not only is work commitment weakened by job insecurity, but organisational effectiveness can deteriorate as well. Thus, outcomes of job insecurity are usually negative. To counteract such outcomes, companies often use reward strategies. Compensation strategies (i.e. severance packages and early retirement incentives), career development schemes, and outplacement techniques may accompany workforce reduction efforts. These are intended to arouse positive psychological states that encourage and sustain productive, rather than destructive behaviour (2000).
Promotion and growth in the organisation are longstanding factors that motivate people to do their best work. According to Herzberg's Motivator-Hygiene Theory (1959; 2002), the most successful method of motivating is to build challenge and opportunity for achievement into the job itself. Moreover, Socially Acquired Needs (1985) theory suggests that people with high achievement needs are motivated by challenging tasks with clearly attainable objectives, timely feedback and more responsibility for innovative assignments. Thus, promotion and growth in the organisation often are addressed through job redesign. The aim of job redesign is to enrich a job so that the employee is more motivated to do the work.
On the business side many managers seem to follow the simple belief that happy workers are productive ones. Workers who are more involved in their jobs display more work commitment and experience lower turnover ( 1989) Workers who are more involved in job-related decisions and communications, receive reinforcement that they are competent in their jobs, and they respond by showing greater involvement and motivation (1989). Achieving job satisfaction can increase employees' commitment and performance, therefore, job redesign strategy need to be carried out for this purpose by means of making employees believe that their work is being performed competently and that their work is having a positive impact on the company. Also, it is important for employees to feel that they control their own actions (1990).
2.3.6 Motivation, Promotion & Development
According to (1995), motivation is typically defined by psychologists as a stimulation that causes the creation of aroused, sustained and directed behavior. This behavior in turn leads individuals to work and perform towards goal achievement. Several authors had also studied on the principal concept behind motivation. (1995) for instance, has defined motivation as the psychological process that results to a directional and purposeful behavior. Motivation is also defined as the tendency to behave in an appropriate manner to attain certain needs (1995). (1994) also gave meaning to the concept of motivation by defining it as the internal drive to satisfy individual needs.
The introduction of several researches on employee motivation has also introduced a number of theories explaining the factors that motivate employees. These theories include the need-hierarchy theory, the reinforcement theory, the two-factor theory, expectancy theory and the equity theory. The need-hierarchy theory of Maslow (1943) is among the first motivation theories that had been introduced. In this theoretical model, Maslow noted five levels of employee needs, which include the physiological, social, ego, safety and self-actualizing needs. From his work, Maslow is a challenging process and that motivation basically works through a series of needs that are arranged in a certain level.
According to (1953), the reinforcement theory suggests the behaviors of the employees directly impact the outcome of their work or their performance. Thus, an employee with a positive behavior will bring about positive outcomes, whereas those with negative behaviors will lead to negative results. Thus, the positive behaviors of the employees should then be reinforced by their managers so as to generate more positive outcomes. on the other hand ( 1959) had classified motivation into two factors. These two factors are motivators and hygienes. Intrinsic or motivator factors pertain to recognition, achievement and attainment of job satisfaction. Alternatively, extrinsic or hygiene factors refers to job security and payments.
Vroom’s expectancy theory implies a similar concept. In this theory, (1964) indicated that the employees’ effort leads to performance and that this performance should be given due rewards and recognition. The nature of these rewards however can be good or bad. The managers should consider giving more positive rewards as these will make employees more motivated. Finally, equity theory implies that workers strive for equity amongst themselves. Adam’s equity theory explains that equity is obtained when the employee outcomes is in proportion to the input ( 1965). Thus, this motivation theory implies that the efforts of the employees at work as well as their good performance should be rewarded appropriately by their managers.
Granting promotion to deserving employees is one way of applying theories of motivation. (1993) stated that promotion is also synonymous to career success where employees are given higher responsibilities or place on higher authority levels. Promotion is considered an important element of human resource management as it encourages employees to perform with quality. This also represents a significant aspect of the internal selection system. The organizational members’ affective reactions towards their job and to the company are also influenced significantly based on their promotional opportunities. Most importantly, the turnover process is reduced through promotion (1993).
Aside from the fact that rapid employee turnover result to significant financial losses, this also works against employee efficiency and productivity. As the morale of the employees are reduced considerably due to turnover, profits and quality are eventually affected ( 1995). With promotion, employees are likely to be more loyal to the company, thus, preventing employee turnover. A previous study (1989) concluded that organizational commitment is positively correlated to internal promotions or career growth; this suggest that promoted employees are likely to have high commitment to the company.
The provision of promotions to employees however tend to vary; some individuals are promoted earlier than others. For example, employees working in managerial or highly technical positions are carefully assessed by the top management before they are promoted. This tendency further stresses the importance of having a well-established succession or promotion plan. Promotion plans and quite similar to salary plans as both are treated with a certain level of confidentiality. Nonetheless, employees must be aware of the plan’s existence and purpose ( 1993).
Employee retention through promotion of employees naturally leads to their development. As employees are trained and educated, promoted individuals learn new knowledge and skills. Furthermore, they become more familiar with their company’s operations. Promotion does not only develop a person’s work abilities, but it also develops his or her behavior and values. For instance, promotion can make the employee more responsible, dependable and mature. Hence, in motivating an employee through promotion, the individual does not only develop professionally but personally as well.
2.4 Employee Empowerment
To retain staff/employees, empowerment of employees should be given enough consideration. Employee empowerment has been considered as a management technique which can be applied universally across all organisations as a means of dealing with the needs of modern global business (2000). and (1988) stated that empowerment describes working arrangements which engage the empowered at an emotional level. They differentiate between concepts of empowerment which are relational and motivational. As a relational concept empowerment is concerned with issues to do with management style and employee participation. As a motivational construct empowerment is individual and personal, it is about discretion, autonomy, power and control. This motivational aspect to empowerment becomes the defining feature of the initiative. Furthermore, (1993) stated that an empowered employee must feel a sense of personal worth, with the ability to effect outcomes and having the power to make a difference. In addition, advocates of empowerment claim that employee empowerment helps firms to enthuse and enable employees to take responsibility for the service encounter ( 2003).
In any business organisations or in MBH Joint Venture, employee empowerment has been associated with many of the key issues related to employment practices in general, namely in gaining competitive advantage through improved service quality. However, the attempt to gain competitive advantage is difficult – because of the difficulties in defining the successful service encounter, particularly in the intangible sources of customer satisfaction. Moreover, there are in fact, some base level customer expectations of employee performance, positive interpersonal contacts, service deliverer attitudes, courtesy and helpfulness that are all closely related to customer evaluations of service quality (2003). Then another problem is in the quality of the service encounter itself. This involves the performance of the employee, on how the employee work and perform the service that should be given to the customers. (1993) stated that seeming to love the job becomes part of the job; and managing the appropriate feelings of enjoyment of the customer helps the worker in this effort. Enabling employees to sense their own power and the significance of their role in the service drama may help employees manage the emotions required of their performance ( 2001). Thus, it can be said that a respond or action of an employee enhanced by satisfaction can be the basis that the employee will give his or her best to the company. Empowered employees willingly take responsibility for the service encounter, they respond more quickly to customer needs, complaints and changes in customer tastes ( 2001). This is important in employee development and retention because it will provide high staff morale and employees will take responsibility for their own performance and its improvement. Furthermore, employees' inherent skills and talents will be put to work for the organisation so as to produce more satisfied customers and profits.
Empowerment is an important HR factor as it promotes commitment for the employer and the employees. The employer is able to benefit from this aspect as employees provide various ideas that will benefit the company and help in resolving its problems. The employees on the other hand, learn from empowerment as their decision-making skills are enhanced. Moreover, they learn more about the company and how it can be operated more efficiently. This effect of empowerment is also known as continuous dynamism or double-loop learning (1978). Aside from empowerment, employees are also able to obtain personal development. By being constantly exposed to strategic training, employees are more encouraged to develop, learn and acquire new knowledge and skills. As a result, employees are more willing and able to overcome changes and organizational turbulence, which in turn also stimulates employees to analyze, contribute and work harder (1996).
2.5 Research Questions
In order to achieve the objective of this paper, the researcher attempts to answer the following queries:
Ø What are the retention strategies that are being instituted in MBH Joint Venture?
Ø What is the effect of employee retention to the organisational performance of the company?
Ø What are the advantages/disadvantages that MBH Joint Venture acquires in retaining their staff?
Ø Is staff retention has significant impact to the performance of the MBH?
CHAPTER 3: RESEARCH DESIGN
3.0 Research Methodology
This part of the paper discusses the methods that have been used for this research. This detailed the steps the researcher took in order to accomplish the study. The said steps then include the collection procedure of the data that is required in the delivery and completion of the research. It also presents the manner in which these data will be utilised and integrated in the study and at the same time, detail how the research proceed to answer the aims and objectives in order to reach to the conclusion.
In this manner, this part of the paper justifies the means in which the study will be performed. It also emphasises its credibility by making mention of widely accepted scientific methodologies. Through the methods mentioned in this paper, a plausible conclusion will be obtained.
Looking back to the aims and objectives of the study, the study intends to determine the staff retention strategies of MBH Joint Venture. In order to identify the opinions of such staff, the study’s methodology was focused on collecting both primary and secondary data through related literature research and the survey and interview materials.
As the research intends to discover the general consensus of staff in MBH with regards to retention, the immediate research methodology in mind is the descriptive research design. The research are taken from various data sources that is integral in identifying issues of employee retention, employee motivation and the status of their performance in MBH.
3.1 Research Design
The study is exploratory, being descriptive and illustrative. To achieve the objective of this study, the researcher opted to use descriptive method of research was utilized. The purpose of employing the descriptive method is to describe the nature of a condition, as it takes place during the time of the study and to explore the cause or causes of a particular condition. The researcher opted to use this kind of research considering the desire to acquire first hand data from the respondents so as to formulate rational and sound conclusions and recommendations for the study. According to Creswell (1994), the descriptive method of research is to collect information or data regarding the present existing situation or phenomenon. Descriptive research has as its purpose developing a better understanding of a phenomenon in detail. Descriptive studies usually have as their purpose the first two aims of normal science as described by (1970): “attempts to increase the accuracy and scope with which facts are known” or “determination of those facts that can be compared directly with the predictions from theory”. The aim of descriptive research is to clarify the nature of a phenomenon in a specified, static context while viewed from a specific, fixed perspective.
Descriptive research design, then, is directed toward clarifying a phenomenon's appearance or nature. In other words, it describes a particular phenomenon, focusing upon the issue of what is happening, rather than why it is happening.
Two types of data were used: the primary and the secondary data. The primary data were derived from the answers respondents gave in the self-administered questionnaire prepared by the researcher. In addition, the information obtained from the interview also provided primary research data that supported the study. The secondary data on the other hand, were derived from the findings stated in published documents and literatures related to the research problem. These were based from the recent literatures related to employee retention and motivation and the concepts cited by the respondents.
In terms of approach, the study employed both qualitative and quantitative approaches. The quantitative approach focused on obtaining numerical findings was used with the survey method. The interview on the other hand, made up the qualitative approach of the study as this focused on personal accounts, observations, description and individual insights of the respondents. This study employed the combined approach so as to overcome the limitations of both approaches.
3.2 Participants
The respondents have been chosen directly from MBH Joint Venture’s HR department. This may include managers, line managers and other employees of the company. All of these participants were selected through random sampling. This sampling method is conducted where each member of a population has an equal opportunity to become part of the sample. As all members of the population have an equal chance of becoming a research participant, this is said to be the most efficient sampling procedure. In order to conduct this sampling strategy, the researcher defined the population first, listed down all the members of the population, and then selected members to make the sample. For this purpose, a self-administered survey questionnaire in Likert format was given to the respondents to answer. The respondents assessed the retention strategies of MBH Joint Venture and determine whether employee retention have a significant impact with organisational performance. However, due to time and budget constraints, the researcher opted for a smaller sample size. In this regard, the dissertation will only consider 50 employees of the company. MBH employees have been chosen to ensure that the data and information that will be gathered is pertinent.
3.3 Research Instruments
For this study, two research instruments were used to evaluate the relationship of the two contexts. These research instruments included the survey questionnaire methods. A self-administered questionnaire was distributed to the selected employees. The questionnaire given to the respondents aimed to assess retention strategies of MBH and identify whether employee retention have significant impact with organisational performance. In addition, this also aims to evaluate the advantages and disadvantages of the MBH’s employee retention strategies as perceived by the respondents in terms of the mentioned aspects above. This focus of the assessment was based on the principles introduced by various authors.
The questionnaire was structured in such a way that respondents will be able to answer it easily. Thus, the set of questionnaire was structured using the Likert format with a five-point response scale. A Likert Scale is a rating scale that requires the subject to indicate his or her degree of agreement or disagreement to a statement. In this type of questionnaire, the respondents were given five response choices. These options served as the quantification of the participants’ agreement or disagreement on each question item. Below are the designated quantifications used in the questionnaire:
1
Strongly Agree
2
Agree
3
Uncertain
4
Disagree
5
Strongly Disagree
3.4 Instrumentation
3.4.1. Content analysis
Content analysis was done to analyse communications in order to answer two levels of questions – the descriptive and the interpretive. Descriptive questions focused on what the communication contains. Interpretative questions focused on what the contents was likely to mean. The process entailed searching through one or more communication to answer questions that an investigator brings to the search (2000). Content Analysis was used to analyze and interpret the interviews.
3.4.2. Statistical Treatment
The Likert scale was used to interpret items in the questionnaire. These responses were based on the respondents’ assessment of the current investment process model. There were instances that the respondents were asked to rate the effectiveness of implementing the phases in the investment process.
The range and interpretation of the five-point scale are shown in Table 1.
Table 1: The Five-point Likert Scale
Scale
Range
Interpretation
5
4.50 – 5.00
Strongly Disagree
4
3.50 – 4.49
Disagree
3
2.50 – 3.49
Uncertain
2
1.50 – 2.49
Agree
1
0.00-1.49
Strongly Agree
Weighted mean was used to measure the general response of the survey samples, whether they agree to a given statement or not.
The formula in computing weighted mean is as follows:
Where: f – weight given to each response
x – number of responses
xt – total number of responses
Results of the survey were presented in tables. Excerpts from the interview were integrated based on the analysis outline. Relevant literatures to support the findings are also included. Basically, the data acquired from the survey was analysed using Pearson Correlation to find out the significant impacts and relationships.
Furthermore, the correlational analysis is conducted in this study. The correlational kind of research method is use due to ethical problems with experiments. Moreover, it is also used due to practical problems with experiments. Moreover, inferring causality from correlation not actually impossible, but very difficult. This mode of study is widely applicable, cheap, and usually ethical. Nonetheless, there exist some "third variable" issues and measurement problems. The correlational research refers to studies in which the purpose is to discover relationships between variables through the use of correlational statistics (r). The square of a correlation coefficient yields the explained variance (r-squared). A correlational relationship between two variables is occasionally the result of an outside source, so we have to be careful and remember that correlation does not necessarily tell us about cause and effect. If a strong relationship is found between two variables, using an experimental approach can test causality.
To assess the strength of relationship between variables, it is important to get the correlation coefficient, which can take on any value between -1 and +1, since this will tell the strength of the relationship between two ranked or quantifiable variables (Saunders et al, 2003, p. 363). Accordingly, a value of +1 represents a perfect positive correlation, which means that the two variables are exactly related, where, as the values of one variable increase, values of the other variable will increase. Conversely, a value of -1 shows a perfect negative correlation, which also means that the two variables are exactly related, only this time, as the values of one variable increase, that of the other decreases. Finally, correlation coefficients between +1 and -1 stand for weaker positive and negative correlations, and a value of 0 means that the variables are completely independent from each other.
Table 1: Values of Correlation
To assist the researcher in the statistical analysis of the gathered data, the Statistical Package for the Social Sciences (SPSS) was used. SPSS is one of the most widely available and powerful statistical software packages that covers a broad range of statistical procedures, which allows a researcher to summarise data (e.g., compute means and standard deviations), determine whether there are significant differences between groups (e.g., t-tests, analysis of variance), examine relationships among variables (e.g., correlation, multiple regression), and graph results (e.g., bar charts, line graphs).
3.5 Ethical ConsiderationsAs this study utilized human participants and investigated on stock market practices, certain issues were addressed. The consideration of these issues is necessary for the purpose of ensuring the privacy as well as the security of the participants. These issues were identified in advance so as prevent future problems that could have risen during the research process. Among the significant issues that were considered included consent, confidentiality and data protection.
In the conduct of the research, the survey forms and interview methods were drafted in a very clear and concise manner to prevent conflicts among respondents. People who participated in the research were given an ample time to respond to the questions posed on them to avoid errors and inaccuracies in their answers. The respondents were given a waiver regarding the confidentiality of their identity and the information that they did not wish to disclose. The respondents’ cooperation was eagerly sought after, and they were assured that the data gathered from them would be treated with the strictest confidence, so that they would be more open. This was done with the hope that this would promote trust between the researcher and the respondents.
CHAPTER 4: METHODOLOGY DESCRIPTION
4.0 Introduction
This part of the paper will present the findings of the analysis of the data gathered from the participants of the study. This chapter discusses the results of the survey questionnaires given to the 50 chosen respondents. Prior to the initiation of the survey process, the aim, the significance and objectives of the dissertation were relayed to the employees of MBH Joint Venture. The employees were also assured that all the information that they had provided are solely for the purpose of this dissertation while their identities would remain confidential. All questions asked in the survey questionnaire provided by the researcher pertain only to the respondents’ insights regarding staff retention and organisational performance.
For a cleared data presentation, the results of the survey are presented in tables and graphs. To provide an appropriate discussion flow, the findings of the study are also divided into various sections. The first section provides a summary of the demographic profile of the participants involved in the study. This demographic profile was categorised in line with the respondents’ age, gender, and position in the company and length of stay in the company.
4.1 Presentation of Results
4.1.1 Demographic Profile
This part will discuss the demographic profile of 50 individuals who answered the survey questionnaire sent by the researcher. The description of the respondents includes their age, gender, and position in the company and length of stay in the company.
Figure 1
The figure above provides the gender of the participants of this study. Herein, it shows that 80% are males which indicate that there are more male employees in MBH since it is related to construction industry.
Figure 2
The figure provides the distribution of respondents in terms of ages. Herein, it shows that 66% of the respondents belong to 25-44 years of age. This may indicated that the corporations that belong to MBH Joint Venture have employees who are matured and experienced enough to fit their job.
Figure 3
Figure 3 presents that distribution of the participants in terms of their position in the company. The figures shows that 34% of the respondents are construction workers and 24% are supervisor line managers and 20% are managers. This is an indication that MBH has a higher tendency of retaining their staff and promoting them for higher positions.
Figure 4
The figure above displays the length of stay in MBH. It shows that majority of the respondents (44%) are working in the company for 6-10 years. This indicates that the management of MBH allows the employees to stay in the company which is supported by their position in the company.
4.1.2 Perception of Respondents
The proceeding sections will present the results in accordance to the Likert technique. It will be remembered that the respondents of the study were presented a set of attitude statements so they can express their agreement or disagreement with the use of a five-point scale, wherein 5 is equivalent to an answer that merits a strong disagreement and 1 as showing a strong agreement (see chapter 3). This will provide a greater understanding about the observations of the following respondents towards MBH.
4.1.2.1 Why MBH Retain their Staffs?
Table 1
Statements
1
2
3
4
5
Weighted Mean
Interpretation
1. MBH retains their staffs to give value to their employees who have shown efficient accomplishment of works throughout the years.
28
22
0
0
0
1.44
Strongly
Agree
2. MBH retains their staff to enhance motivation and boosts the morale of employees who have been successfully contributes to the growth of the company.
41
9
0
0
0
1.18
Strongly
Agree
3. Staff retention enables the management of MBH to save costs for training employees who are newly hired for a specific position.
36
14
0
0
0
1.28
Strongly
Agree
4. Staff retention enables the company to have a good image in terms of retaining valuable employees.
27
14
0
3
6
1.94
Agree
The table above presents the results of the survey regarding the reasons why MBH retains their staff, as perceived by the respondents. In the given statements, the answers of the employee’s ranges from agree to strongly agree. Herein, the respondents strongly agreed that MBH retained their staffs to provide value to their employees, who have shown efficient accomplishment of their tasks, enhance motivation and boosts the employee morale who been successfully contribute to the growth of the company and to enable the management to save costs for training employees who are newly hired. On one hand, the respondents agreed that the MBH retains their staff to have a good image in line with retaining and valuing their staffs.
4.1.2.2 Problems regarding the current employee retention strategy of MBH Joint Venture
Table 2
Statements
1
2
3
4
5
Weighted Mean
Interpretation
1. MBH employee retention strategy have standardized criteria to retain the best employee for a certain job.
12
5
15
13
5
2.88
Uncertain
2. The retention strategy of MBH provides clarity of expectations among employees.
9
12
8
17
4
2.90
Uncertain
3. Staff retention strategy of MBH provides clarity regarding the career development and earning potential of their employees.
9
13
5
14
9
3.02
Uncertain
4. The MBH’s staff retention strategy have the ability to measure the performance of their employees which hampers the selection of the best employee.
5
9
3
21
12
3.52
Disagree
5. The staffs which handle MBH Staff retention strategy have the initiative to pursue a more rigorous measurement to retain the best staff.
8
9
5
10
18
3.42
Uncertain
6. The staff retention strategy conducts scheduled meetings to assess employee performance.
18
15
0
7
10
2.52
Uncertain
The table above provides the perception of respondents about the problems of Staff retention strategy of MBH. Herein, it shows that most of the employees are uncertain and disagreed on the given statements. The respondents are uncertain on whether MBH retention strategy has standardized criteria to retain the best employee for a certain job, provide clarity of expectations among employees, provide clarity regarding the career development and earning potential of their employees, have the initiative to pursue a more rigorous measurement to retain the best staff and scheduled meetings to assess employee performance. On one hand, they disagreed that the retention strategy of MBH has the ability to measure the performance of their employees which hampers the selection of the best employee.
4.1.2.3 Employee Retention Strategies of MBH Joint Venture
Table 3
Statements
1
2
3
4
5
Weighted Mean
Interpretation
1. MBH employee retention strategy includes placing the needs and expectations of their employees at the centre of the company’s organisational agenda so as to ensure the employee satisfaction and enable a trusted relationship.
38
12
0
0
0
1.24
Strongly
Agree
2. Part of the retention strategy of MBH is their goal of having a good relationship between top management and employees.
27
14
0
3
6
1.94
Agree
3. Staff retention strategy of MBH includes giving rewards and incentive to ensure that top employees will stay long in the company.
28
22
0
0
0
1.44
Strongly
Agree
4. The MBH’s staff retention strategy includes performance appraisal to recognise an employee who accomplish their job efficiently.
41
9
0
0
0
1.18
Strongly
Agree
5. The Retention strategy of MBH provides opportunity for employee growth and development.
36
14
0
0
0
1.28
Strongly
Agree
6. The staff retention strategy of MBH includes a quality compensation package.
17
13
6
7
7
2.48
Agree
7. The staff retention strategy of MBH includes performance management program to build cooperation and trust.
16
28
0
4
2
1.96
Agree
The table above provides the distribution of the perception of the respondents regarding the retention strategy of MBH Joint venture. The perception of the respondents to the given statements consists of strongly agreed and agreed. Herein, the employees who took part in this study strongly agreed that MBH employee retention strategy in are able to place the needs and expectations of the employees at the core of the MBH’s organisational agenda to make sure that their employees will be satisfied and for trusted relationship. The participants also strongly agreed that staff retention strategy includes employee rewards and incentives to ensure that their best employee will stay long in MBH and they also include performance appraisal to recognise employees who accomplish their job efficient. Lastly, the employees of MBH strongly agreed that MBH retention strategy provides opportunity for employee growth and development.
On the other hand, the employee who took part in the study agreed that a part of the retention strategy of MBH is their goal of having a good relationship between top management and employees and MBH retention strategy includes compensation package and they agreed on the statement that retention strategy of MBH includes performance management program to build cooperation and trust
4.1.2.4 Impact of Employee Retention with Organisational Performance of MBH
Table 4
Statements
1
2
3
4
5
Weighted Mean
Interpretation
1. Employee retention enables the company to retain the more experienced employees who have greater knowledge of organisational and customer goals.
28
22
0
0
0
1.44
Strongly
Agree
2. Employee retention enables MBH to save costs because a low turnover rate also means less hiring and training activities.
38
12
0
0
0
1.24
Strongly
Agree
3. Employee retention enables MBH to have satisfied employee which results on having more satisfied clients.
41
9
0
0
0
1.18
Strongly
Agree
4. Because of the employee retention approach of MBH, they are able to improve their productivity and profitability.
41
9
0
0
0
1.18
Strongly
Agree
5. Employee retention allows MBH to have high-skilled employees that helps in effective organisational performance.
28
22
0
0
0
1.44
Strongly
Agree
Table 4 presents the performance of the respondents about the effect employee retention with the organisational performance of MBH. In this regard, most of the employee have strongly agreed that eemployee retention enables the company to retain the more experienced employees who have greater knowledge of organisational and customer goals and it helps the company to save costs, to have satisfied employees, improved productivity and profitability and to have high skilled employees which helps to enhance organisational effectiveness and performance.
4.1.2.5 Correlation: Employee Retention Strategy and Organisational Performance of MBH
To be able to identify the relationship between MBH employee retention strategy and organisational performance, the use of correlational statistic was considered. Accordingly, the strength of the linear association or relationship between these two aspects is quantified by the correlation coefficient.
Provided with a set of observations (x1, y1), (x2,y2),...(xn,yn), the formula that will be used for computing the correlation coefficient is given by:
Where:
= Correlation between X and Y
= Sum of Variable X
= Sum of Variable Y
= Sum of the product X and Y
N= Number of Cases
= Sum of squared X score
= Sum of squared Y score
Furthermore, the correlation coefficient always takes a value which ranges from -1 and 1, with 1 or -1 imply perfect correlation (all points would lay along a straight line in this case). On one hand, a positive correlation implies a positive relationship between the variables (increasing values in one variable correspond to increasing values in the other variable), while a negative correlation implies a negative relation or association between the variables (increasing values is one variable correspond to decreasing values in the other variable). Lastly, a correlation value close to 0 indicates that there is no association between the given variables.
Since the formula for calculating the correlation coefficient standardizes the variables, alterations in scale or units of measurement will not influence its value. For this reason, the correlation coefficient is often more useful than any other graphical depiction in identifying the strength of the association or relationship between two variables.
Furthermore, if the correlation index of the computed rxy is not perfect, then it is suggested to use the following categorization:
rxy Indication
between ± 0.80 to ± 1.00 : High Correlation
between ± 0.60 to ± 0.79 : Moderately High Correlation
between ± 0.40 to ± 0.59 : Moderate Correlation
between ± 0.20 to ± 0.39 : Low Correlation
between ± 0.01 to ± 0.19 : Negligible Correlation
4.2 Analysis of Results
Relationship between Employee Retention Strategy and Organisational Performance of MBH Joint Venture
Table 5
The correlation table displays above presents Pearson correlation coefficients, the significance values, and the number of cases in the study with non-missing values. As noted, Pearson correlation coefficients presupposed that the data are normally distributed. The Pearson correlation coefficient is known as a measure of linear association or relationship between two variables.
As mentioned in the third chapter of this dissertation, the values of the correlation coefficient range from -1 to 1. The sign of the correlation coefficient implies the direction of the relationship (positive or negative). On one hand, the absolute value of the coefficient of correlation signifies the strength, with larger absolute values showing stronger relationships. The correlation coefficients on the main diagonal are always 1.0, because each variable has a perfect positive linear relationship with itself. Correlations above the main diagonal are a mirror image of those below.
In the data gathered from the 50 respondents/employees of MBH Joint Venture, the correlation coefficient employee retention strategy of MBH and (independent) and organisational performance of MBH Joint Venture (dependent) is 0.975. Since 0.975 is relatively close to 1 or -1 this indicates that employee retention strategy of MBH (independent) is highly correlated with the organisational performance of the company (dependent). This means that effective employee retention strategy may lead to effective organisational performance and inability of the management to use effective employee retention strategy may affect the performance of the organisation.
The significance of each correlation coefficient is also presented in the correlation table. The significance level (or p-value) is the probability of obtaining results as extreme as the one observed. If the significance level is very small (less than 0.05) then the correlation is significant and the two variables are linearly related. If the significance level is relatively large, for example, 0.50, then the correlation is not significant and the two variables are not linearly related. In this regard, since the significance measure is .00, this means that both variables have significant relation with each other.
4.3 Summary of Findings
In this study, there were altogether 110 participants who are employees of MBH Joint Venture. The demographic profile of the employee or participants was reported at the beginning of Chapter 4. The perception of the respondents about the reasons why MBH Joint Venture retains their staff, problems of current employee retention strategy, the employee retentions strategy and the impact of employee retention with organisational performance of MBH were identified through the survey-questionnaire. With the use of SPSS for Windows, the results were analysed and summarised as follows:
· MBH retains their staff to give value to their employee who have shown efficient accomplishment of works, enhance motivation among employees, to save costs for training newly hired employees and to enable the company to have a good image in terms of retaining valuable employees.
· The respondents perceived that they are uncertain of the problems of the employee retention strategy of MBH Joint venture based on the given statements in the questionnaire.
· Employee retention strategy of MBH Joint Venture is considered to adhere to the context of motivational fit, external rewards, cooperation and trust and company direction.
· The findings show that the employee retention affects organisational performance of MBH as seen in the correlational analysis of this chapter.
In the following chapter, the researcher would relate the above findings with established theories.
CHAPTER 5: DISCUSSION AND IMPLICATION
5.0 Introduction
This part of the research provides the discussion of the results findings presented in the previous chapters. This study aims one determining the employee retention strategy of MBH and assesses it for the possible problems and it faced and the relationship of employee retention with organisational performance.
The study also aims to provide possible recommendation about the most appropriate employee retention strategy that MBH may use. This is done by carefully examining the answers of the respondents. As mentioned, respondents include employees of MBH Joint Venture. Data collected from the participants provided answers to the queries of the researcher.
In this research study, the primary source of data came from a survey-questionnaire which was distributed to the respondents: 50 employees of MBH have responded to this study. Their cooperation was fervently soughed after and its descriptive analysis was undertaken by the researcher through the descriptive research method that uses observation and surveys and through the use of SPSS for the correlation of the study.
5.1 Interpretation of Results
Employees are considered as one of the most important assets of an organisation. In this regard one of the roles of the human resource management of an organisation is to ensure that the best employees will be retained. Primarily, the focus of this dissertation is to assess the employee retention strategy of MBH Joint Venture and to determine whether employee retention has significant relations with the organisational performance. In this research study, the respondents comprise of males (80%) and females (20%), 66% of the total respondents belong to 25-44 years which indicates that MBH Joint Venture have mature employees. The participants in this study are construction workers, line managers, supervisors, clerical and manager and most of them are working in MBH Joint Venture for 6-10 years. From the demographic profile of the respondents, it shows that MBH has been capable of retaining their employees.
5.2 Discussion of Results
In this study, the participants were asked about their perception on the reasons of MBH why they retain their employees. In this study, the reasons include the motivation of employees, cost saving and image enhancement of the company.
As have been noted, motivation is necessary for the growth of the employee in the organization. The employee starts his career through learning, basically the culture of the organization and his responsibilities. Motivation is a vital element to learning because if an organization does not possess the ability to motivate its employees, the knowledge within the organization is not practically used to the fullest ( 1999). Thus, in every successful learning organization, finding the factors that will motivate its employees to partake in continuous learning and to take advantage of this knowledge, accordingly, becomes their aim (Osteraker, 1999).
In this light, MBH Joint Venture has realised that retention of skilled employees is obviously important. They function well and stand out among the others. Accordingly, a company loses approximately $1 million with every 10 managerial and professional employees who leave the organization (1997). A company also loses critical knowledge necessary for better performance when a skilled employee decides to resign. Skilled employees are badly needed because they rarely come. If the training was provided by the organization, the turnover of skilled employees would just put the training expenses into waste.
In the dynamic triangle motivation, different variables such as society, organizational culture and the personality of employees were taken into account ( 1999). By accepting the participation of employees in the motivational process and fostering a dialogue between the examiner and the examined, the values in the organization are allowed to influence the whole motivational process (1999). Moreover, according to (1995), correctly applied and operational employee participation increases productivity as supported by empirical literature. Similarly, (2001) highlighted the importance of high work life quality through good supervision, working conditions, pay and benefits as well as challenging and rewarding jobs. Such MBH management performance is noted to be important aspects for employee retention.
The study has also been conducted in order to determine the problems of the employee retentions strategy of MBH Joint Venture. As the result of the findings, it can be said that MBH Joint Venture does not have much problem regarding their employee retention strategy. The statements given by the researcher have corresponding answers of uncertainty and disagreement from the participants of the study. Herein, most of the employees are uncertain if the MBH employee retention strategy lacks standardized criteria to retain their top employees, or whether MBH does not provide clarity of expectations of the company for the employees. The study also revealed that as perceived by the employees, they disagreed that MBH does not provide clarity about the career development and earning potential of their employees. The employee are also uncertain if the retention strategy of the company lack the ability to measure the performance of the staffs and whether the staff responsible for employee retention do not have the initiative to pursue a more rigorous measurement to retain their best staff. The analysis revealed that the respondents are uncertain whether the staff retention strategy conducts scheduled meetings to assess performance of the employee. The result of the analysis shows that, if we take a look at table 2 (Chapter 4), the distribution of the answers of the employees to the given statement are well distributed. Some agreed and disagreed on the given statement. This could indicate that though MBH Joint Venture has been able to have employee retention strategy, their approach is still can consider to have problems and issues that needs to be solved from the point of view of their employees.
One of the main objectives of this study is to identify the employee retention strategy of the MBH Joint venture. Based on the data gathered and analysis in the previous chapter, the study revealed that the employee retention strategy of MBH adheres to motivational fit, external reward, career and employee development, and good interpersonal relationship and performance appraisal. Performance appraisal or evaluation of the employees is an important driver for motivating and retaining employees. By means of evaluating the employees’ performance, the company is able to assess their employees individually based on various aspects such as daily work output, quality of work, work attitudes and overall performance. This helps the company identify their employees’ strengths and weaknesses. The employees on the other hand will be able to recognize where they are good at and what needs to be improved. Included in this aspect is the provision of various forms of recognition for hard working and deserving employees. Through performance appraisal, the company motivates its employees to work more efficiently.
The provision of rewards or incentives to the employees is also an important factor for managing human resource. Rewards can come in a number of forms. In general, rewards can be given as monetary incentives like bonuses or as non-monetary incentives like dinner certificates, public recognition and other similar rewards that do not have any monetary value. This concept is actually based on two theoretical frameworks: the expectancy and agency theory. The expectancy theory states that the provision of rewards serve as a powerful driver to motivate others. The agency theory on the other hand is based on the perspective that rewards are a useful tool for aligning the goals of the management with that of the stockholders. From these theoretical perspectives, reward is viewed as an instrument of motivation, which in turn optimizes the employees’ performance ( 1997). According to (2004), when organisations value and reward people, those people are committed to performing well. As a result, the organisation accomplishes more and it can then reward employees more and attracts and retain more talented employees. This leads to even higher organisational performance. It also involves developing a variety of HR practices that motivate people to peak performance with accompanying rewards. Staffs, in turn, are more committed to the organization and more responsible for their own behaviours (contribution, learning, development, etc.).
This study also attempted to know the impact of employee retention with MBH. In this regard, the analysis of the gathered data from 50 employees of the company revealed that employee retention enable MBH to retain more experienced employees who have greater knowledge of organisational and customer goals. In addition, employee retention also enables MBH to save costs because a low turnover rate also means less hiring and training activities and have satisfied employee which results on having more satisfied clients. Through employee retention, MBH has also improved their productivity and profitability and it allows them to have high-skilled employees that help in effective organisational performance.
CHAPTER 6: CONCLUSIONS AND RECOMMENDATIONS
6.0 Conclusions
Organizations today realize that employees are part of their competitive advantages. Along with effective business strategies and sufficient capital, investments for developing highly skilled human resources have been part of most companies’ road towards success. In order to obtain this unique competitive advantage, organizational management must be able to give sufficient motivation to their employees. Employee retention is among the most common ways on how companies motivate their employees. Naturally, well-established employee retention policies and strategies are important so as to retain top or best employees for the organisation. The provision of employee retention is not only for the benefit of the employees but also to the company. If employees are given the right amount of motivation, fast workforce turnover will be prevented. This in turn, will prevent high cost incurred from recruitment and training. In order to understand more about the role of employee retention this study has been conducted.
Accordingly, since MBH is a joint venture between three companies, the issue of employee retention has been considered. With this Joint Venture changes implemented within a business organization’s work process leads to subsequent changes in all its departments including their employees. In continuous improvement approaches, modern human resources management are confronted with duties to coordinate as well as administer the staff and employees to guarantee that they exhibit enthusiasm and dedication in attending to their respective responsibilities and duties in the company.
Since people are the most valuable asset within the principles of human resources management and professional development, employee satisfaction as ensured through proper motivation and compensation must be carefully considered. With regards to training and professional development, its importance has been highlighted due to its direct impact on the performance of the company in the midst of competitive market environments of the different existing industries. With the continuous changes and innovations in the external environment of the business organizations, the management particularly the management of MBH is in constant look out for new trends in the market that should be incorporated in the internal operations and functions of the company in order to elicit and maximize the potential of its human capital. These are made possible through training and development program for the members of the business organization.
According to (1997) business organizations, most of the time impedes their initiative to provide training to the employees for their professional development in order to ensure that the employees that will be selected for training can serve the commercial objectives of the company and those trained individuals are given the chance to be retained in the organisation. Employee retention or the employees’ guarantee of providing services to the company for a long period of time is a common priority among human resources managers thus, ensuring that employees with invested training do not leave the company through contract bonds.
Woodruffe (2000) supported the previous claims by indicating that strategies should be created in order to effectively train employees for professional development and as part of the employee retention strategy. According to (2000) training and development serve as means to increase the service values of business organizations in the objective to meet the demands of the market. As such, it is important for human resources managers to look into the current as well as the future market needs of the industry in order to develop training programs and materials that will best suit the needs of the businesses. Moreover, there should be an examination of the most appropriate methods and techniques for employee and staff training along with the need to enumerate the priorities and corporate objectives of the company so as to create a balance between the needs of the company and the available training programs for the employees.
At present, business organizations cater in providing training programs and as well as learning experience to the members of the workforce in which both the company and the individual employee can take advantage of the benefits. Through employee training and development, employers are equipped with human assets that will best serve the needs of the business organization. Given that the employees were able to acquire the knowledge and skills from the training and development programs of the company, the entirety of the business organization will directly benefit from having a productive workforce. Meanwhile, the employees are provided with technical capabilities in order to be more competitive in their careers in the hope of achieving better compensation, incentives and rewards for performing better in their assigned tasks and responsibilities and for their expectation for being retained within the company, in this case MBH Joint Venture. As a result, a business organization which invested for the employee retention are given opportunities to exhaust the capabilities of its human capital who are composed of productive and qualified employees and staff.
It can be concluded that MBH Joint Venture has been able to implement an effective employee retention strategy by establishing a clear ladder for the employees. Consequently, having a clear career development, employees of MBH have been bale to be more motivated to perform well so as to progress in the company. Naturally, as the employees’ progress in company position, MBH also includes in their employee retention strategy the corresponding compensation increases. In this regard, as employees are encouraged to work towards their personal career goals, they are more likely to stay in the company and with their developed skills and potentialities; they are most likely to be retained in the company. The progress of the employee retention strategy of MBH are said to be based on the results of their performance in the employee evaluation or performance appraisal. The main objective of this scheme is not only to reward the employees for their hard work but also to retain the company’s best employees.
(1993) stated that employee retention strategy is also synonymous to career success where employees are given higher responsibilities or place on higher authority levels. Employee retention strategy is considered an important element of human resource management as it encourages employees to perform with quality. This also represents a significant aspect of the internal selection system. The organizational members’ affective reactions towards their job and to the company are also influenced significantly based on their employee retention opportunities. Most importantly, the turnover process is reduced through an effective employee retention approach ( 1993). The literatures of the previous chapter clearly stress that by means of recognizing the efforts of the employees and by means of motivating the employees through the conduction of performance evaluation and provision of due rewards, employees are more likely to stay in the company and be interested in their jobs.
All in all, this study revealed that employee retention has a significant relation with the organisational performance of MBH Joint Venture.
6.1 Recommendations
As noted in this study, MBH Joint Venture uses employee retention approach to ensure that their employee is given opportunity to professionally develop and for the sake of the company as well. Though, the research study revealed employee retention strategy of MBH has been very successful and effective, the following recommendations are still suggested for further improvement and enhancement of the current employee retention strategy of MBH Joint Venture.
6.1.1 Interest and Desire to Learn New Things
Employee retention strategy is a process wherein top employees are being retained for the sake of the company. In this regard, the employees may worry to lose their jobs because of the uncertainty and the outdated skills. Thus, the management of MBH should then emphasize on the use of training and development programs to motivate and provide an opportunity for the employees to upgrade their skills and knowledge to have a greater opportunity to be retained in the company. For example, allow employees to go through several positions by undergoing the cross-training program, this could help employees to understand the relationship between different jobs and enrich their knowledge for different departments and positions.
Additionally, MBH management could provide internal and external training opportunities for the employees. For example, arranging on-the-job and off-the-job training, soliciting external training opportunities for staff and providing more generous education allowances could work to satisfy this need. Such of things could help the employees to development their skills, knowledge and capacities so that staff could overcome the future changes. The employees may feel more secure o their jobs and become competent in their jobs.
Training employees to assume greater responsibilities than required by their present positions will better prepare them for promotion to higher level jobs when vacancies occur as a result of turnover. That will be a benefit for the company also as there will be successor for the vacancies may rise in the future. Also, employers may place more emphasis on career planning for construction employees. This has traditionally been a weakness in human resources management in the construction industries. Provide more opportunities for the employees to learn more new things that they are interested at rather than repeating reinforce old knowledge and skills will be one of the best motivator for employee development.
6.1.2 Enhancing Job Knowledge
One of the important motivator of employee development in the construction industry is enhance job knowledge. Employee retention strategy which include development program designed to the employees should be relevant to their existing job or career development in their future. Same as mentioned above, learning new things for example, allow employees to go through several positions by undergoing the cross-training program, this could help employees to understand the relationship between different jobs and enrich their knowledge for different departments and positions. Also, mentoring program which was used in MBH industry very often can be promoted and retained as that will be a good employee development program for future successor.
6.1.3 Reward Form Achievement
The management of MBH should also realize that their employees wish not only for wages, but also for respect and sense of achievement. Many found that praise and recognition are often more powerful and are more long-lasting than mere money ( 1998). Providing employee with recognition programs would show the respect, appreciation of the employees’ improvement. Recognition is one of the most powerful methods to motivate employees to learn. There are many ways of recognition and reward. For example, Certificate of Merits, reward by award such as Best Improvement employee of the Year, being sent out for external trainings by company or being a departmental trainer in the company. Specially, introducing mentor system could be recognition to motivate employees to learn. A mentor system is designed to address the needs and concerns of the employees and help them make the transition to the new workplace a comfortable pleasant and rewarding experience (1991). For example, mentors or department training coordinators should be appointed to take care of the new employees from their first day until they are both technically and socially confident enough to work on their own. Such things could encourage employees to perform at their best ability, as well as encourage their continuous endeavors on their jobs. Not only the retained employee, the selected trainer will have a sense of achievement and felt being respect and appreciated on their hard work and good performance. Such kind of empowerment provides employees with a sense of autonomy, authority and control together with the abilities, resources and discretion to make decision. This will encourage the development of the employee and to ensure them of staying long in the company like MBH.
A management cannot motivate employees with promotions if their most intense needs are social or if they do not want promotions. It does no good to promise employees end-of-year monetary bonuses if they happen to already be very well- to-do financially (perhaps from an inheritance or the like). Rewards not matched to wants and needs are not valued. Hence, the management of MBH should also include Employee Rewards as part of their retention study and this must match to one's most dominant needs to be highly valued and thus to highly motivate. For rewards to be valued, the MBH management must see to it that the Employee Reward Policy includes the proper scheduling on when would be the most accurate time to give the rewards. Generally rewards received by an individual soon after accomplishment of a goal, or soon after attainment of a given targeted performance level, are the most valued rewards and the rewards that serve best to install a desire for further achievement or continued good performance, when the reward is tied to performance in time that reward is closely associated with the performance. It becomes an extension of the performance. It has real meaning because one can vividly see that it was received for performance.
Employees are one of the driving-forces that generally contributes for the success or failure of any organization. Therefore the Management should be able to create an overall policy that will make the employees feel that they are being valued so that they will be encourage and motivated to provide quality services and be motivated to stay long in the company.
Appendix
Questionnaire
The researcher is conducting a study on the Staff retention Strategy of MBH Joint venture. To enable the researcher to make the necessary conclusions and recommendations for this study, it would be very much appreciated if you answer all the items in the questionnaire.
Information given will be treated in strictest confidence.
Thank you.
Part 1. Profile of Respondent
Direction: Please fill up in all the necessary information about yourself. Don’t leave any item unanswered.
A. For the Employees
a. Age_____________________
b. Gender
Male ( )
Female ( )
c. Position in the Company _________________________
d. Length of Stay in the Company
Part 2: Perception of Respondents
Direction: Check the number corresponding to your answer1 - Strongly Agree
2 - Agree
3 - Uncertain
4 - Disagree
5 - Strongly Disagree
1. Why MBH Retain their Staffs?
Table 1
Statements
1
2
3
4
5
1. MBH retains their staffs to give value to their employees who have shown efficient accomplishment of works throughout the years.
2. MBH retains their staff to enhance motivation and boosts the morale of employees who have been successfully contributes to the growth of the company.
3. Staff retention enables the management of MBH to save costs for training employees who are newly hired for a specific position.
4. Staff retention enables the company to have a good image in terms of retaining valuable employees.
2. Problems regarding the current employee retention strategy of MBH Joint Venture
Statements
1
2
3
4
5
1. MBH employee retention strategy lacks standardized criteria to retain the best employee for a certain job.
2. The retention strategy of MBH does not provide clarity of expectations among employees.
3. Staff retention strategy of MBH does not provide clarity regarding the career development and earning potential of their employees.
4. The MBH’s staff retention strategy lacks the ability to measure the performance of their employees which hampers the selection of the best employee.
5. The staffs which handle MBH Staff retention strategy do not have the initiative to pursue a more rigorous measurement to retain the best staff.
6. The staff retention strategy conducts scheduled meetings to assess employee performance.
3. Employee Retention Strategies of MBH Joint Venture
Table 3
Statements
1
2
3
4
5
1. MBH employee retention strategy includes placing the needs and expectations of their employees at the centre of the company’s organisational agenda so as to ensure the employee satisfaction and enable a trusted relationship.
2. Part of the retention strategy of MBH is their goal of having a good relationship between top management and employees.
3. Staff retention strategy of MBH includes giving rewards and incentive to ensure that top employees will stay long in the company.
4. The MBH’s staff retention strategy includes performance appraisal to recognise an employee who accomplish their job efficiently.
5. The Retention strategy of MBH provides opportunity for employee growth and development.
6. The staff retention strategy of MBH includes a quality compensation package.
7. The staff retention strategy of MBH includes performance management program to build cooperation and trust.
4. Impact of Employee Retention with Organisational Performance of MBH
Table 4
Statements
1
2
3
4
5
1. Employee retention enables the company to retain the more experienced employees who have greater knowledge of organisational and customer goals.
2. Employee retention enables MBH to save costs because a low turnover rate also means less hiring and training activities.
3. Employee retention enables MBH to have satisfied employee which results on having more satisfied clients.
4. Because of the employee retention approach of MBH, they are able to improve their productivity and profitability.
5. Employee retention allows MBH to have high-skilled employees that helps in effective organisational performance.
THANK YOU VERY MUCH
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