OBJECTIVES OF HUMAN RESOURCE MANAGEMENT

 

9. Retention


Employee retention in an organization refers to the ability of an organization to keep its employees over a prolonged period, reducing turnover and ensuring that key talent stays with the company. High employee retention is beneficial because it lowers recruitment costs, enhances employee morale, improves organizational knowledge and productivity, and fosters a positive company culture. 

we can see there are employee turnover in some organizations due to lack of recognition or promotions. therefor the employer should identify the performers in order to reduce performing employee turnover. There might be employee turnover in organizations but talent should be retained. Here are some key aspects and strategies for improving retention in HRM:


1. Employee Engagement




  • Definition: Engaged employees are emotionally invested in their work and committed to the organization’s goals.
  • Strategy: Organizations should create an environment where employees feel valued, supported, and motivated to perform. This can include offering meaningful work, recognition programs, and opportunities for development and growth.
  • Reference: Harter, J. K., Schmidt, F. L., & Hayes, T. L. (2002). Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal of Applied Psychology, 87(2), 268-279.

2. Competitive Compensation and Benefits




  • Definition: A competitive pay structure that meets or exceeds industry standards, coupled with attractive benefits packages, can improve retention by making employees feel financially secure and valued.
  • Strategy: Regularly review and adjust salary structures to stay competitive. In addition, offering health benefits, retirement plans, flexible working hours, and wellness programs can be a strong retention tool.
  • Reference: Milkovich, G. T., & Newman, J. M. (2008). Compensation (9th ed.). Boston, MA: McGraw-Hill.

3. Career Development Opportunities

  • Definition: Providing employees with opportunities for professional growth and career advancement is crucial for retention.
  • Strategy: Offer training programs, mentorship, and clear career progression paths. This can include internal promotions and creating a culture where employees can grow their skills and advance their careers within the company.
  • Reference: Noe, R. A. (2010). Employee training and development (5th ed.). New York, NY: McGraw-Hill.

4. Work-Life Balance



  • Definition: The ability of employees to manage their work responsibilities while maintaining personal and family commitments can lead to higher job satisfaction and retention.
  • Strategy: Organizations can offer flexible working hours, remote work options, and paid time off to help employees balance their professional and personal lives.
  • Reference: Greenhaus, J. H., & Allen, T. D. (2011). Work-family balance: A review and extension of the literature. Handbook of Occupational Health Psychology, 165-183.

5. Organizational Culture and Environment



  • Definition: A positive work culture, where employees feel respected, included, and part of a team, plays a key role in retention.
  • Strategy: Foster a collaborative, inclusive, and transparent environment. Leadership should be supportive and approachable, and organizations should work to ensure diversity and inclusivity in the workplace.
  • Reference: Schein, E. H. (2010). Organizational culture and leadership (4th ed.). San Francisco, CA: Jossey-Bass.

6. Recognition and Reward Systems

  • Definition: Recognizing employees’ efforts and achievements can increase job satisfaction and loyalty.
  • Strategy: Develop formal and informal recognition programs, such as employee of the month, performance bonuses, or public acknowledgment in team meetings.
  • Reference: Chi, N. W., & Goh, C. F. (2010). The moderating role of organizational culture in the relationship between HR practices and organizational outcomes. International Journal of Human Resource Management, 21(1), 1-22.

7. Exit Interviews

  • Definition: When employees do leave, conducting exit interviews provides valuable feedback about why they chose to leave and what could be improved.
  • Strategy: Use the information gathered to refine retention strategies and address any systemic issues within the organization.
  • Reference: Carraher, S. M., & Buckley, M. R. (2008). The impact of exit interviews on retention in the hospitality industry. Journal of Business Research, 61(8), 812-817.

8. Job Fit and Workload Management

  • Definition: Ensuring employees are in roles that align with their skills, values, and career goals is important for retention. Additionally, preventing burnout through proper workload management is essential.
  • Strategy: Offer job rotation programs and ensure realistic job expectations. Avoid overburdening employees with excessive workloads, and address burnout concerns before they become major issues.
  • Reference: Kristof-Brown, A. L., Zimmerman, R. D., & Johnson, E. C. (2005). Do person–organization fit and person–job fit matter? Personnel Psychology, 58(3), 281-342.

Conclusion

By addressing these strategies and focusing on key elements like employee engagement, career development, work-life balance, and a positive work environment, organizations can foster high retention rates, reduce turnover costs, and enhance overall organizational effectiveness.

References:

  • Carraher, S. M., & Buckley, M. R. (2008). The impact of exit interviews on retention in the hospitality industry. Journal of Business Research, 61(8), 812-817.
  • Chi, N. W., & Goh, C. F. (2010). The moderating role of organizational culture in the relationship between HR practices and organizational outcomes. International Journal of Human Resource Management, 21(1), 1-22.
  • Greenhaus, J. H., & Allen, T. D. (2011). Work-family balance: A review and extension of the literature. Handbook of Occupational Health Psychology, 165-183.
  • Harter, J. K., Schmidt, F. L., & Hayes, T. L. (2002). Business-unit-level relationship between employee satisfaction, employee engagement, and business outcomes: A meta-analysis. Journal of Applied Psychology, 87(2), 268-279.
  • Kristof-Brown, A. L., Zimmerman, R. D., & Johnson, E. C. (2005). Do person–organization fit and person–job fit matter? Personnel Psychology, 58(3), 281-342.
  • Milkovich, G. T., & Newman, J. M. (2008). Compensation (9th ed.). Boston, MA: McGraw-Hill.
  • Noe, R. A. (2010). Employee training and development (5th ed.). New York, NY: McGraw-Hill.
  • Schein, E. H. (2010). Organizational culture and leadership (4th ed.). San Francisco, CA: Jossey-Bass.


Comments

  1. Malsha PereraApril 3, 2025 at 8:45 AM

    Yes, I think your focus is very important for employees and employer also. If employees are working happy, they are retaining long period, and it is an extra anergy for organization. which have more experience staff, that company can maintain good market share always.

    ReplyDelete
  2. Chalani ThilakaratneApril 3, 2025 at 9:43 AM

    You have highlighted key strategies like competitive pay, work-life balance, and positive workplace culture to reduce turnover in this article. A well-structured and informative read for HR professionals!

    ReplyDelete
  3. Shankanee IllangarathnaApril 3, 2025 at 10:35 AM

    Employee retention isn’t just about keeping people on the payroll, but it’s about creating an environment where they want to stay and grow. Competitive salaries and benefits matter, but real retention comes from meaningful work, career development, and a culture of respect. Organizations that invest in trust, recognition, and employee well-being build workplaces where people don’t just stay...they thrive.

    ReplyDelete
  4. Bharathi BulathsinhalaApril 5, 2025 at 6:45 AM

    Employee retention is crucial for maintaining organizational knowledge, reducing recruitment costs, and ensuring consistent performance. Investing in employee satisfaction and development can significantly improve retention rates. Good insight

    ReplyDelete
  5. Lahiru AmarasingheApril 5, 2025 at 6:57 AM

    Great post! You’ve clearly outlined the key objectives of HRM, especially the importance of employee retention and creating a positive work environment. Well done!

    ReplyDelete

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