Factors Affecting Employee's Retention

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In this chapter, the previous studies for employee‘s retentions are presented to be the framework to understand and systematically analyze factors that affect employee‘s intentions.
Retention defined as ―an obligation to continue to do business or exchange with a particular company on an ongoing basis ‖ (Zineldin, 2000).
Retention is a voluntary move by an organization to create an environment which engages employees for a long term (Chaminade, 2007). According to Samuel and Chipunza (2009), the main purpose of retention is to prevent the loss of competent employees from leaving the organization as this could have adverse effect on productivity and profitability. However, retention practices have become a daunting and highly challenging task
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Abassi and Hollman (2000); Hewitts Associates (2006); Sherman et al. (2006) highlights some of these reasons as hiring practices, management style, lack of recognition, lack of competitive compensation system, toxic workplace environment. Others include lack of interesting work, lack of job security, lack of promotion and inadequate training and development opportunities. These variables can be broadly classified into intrinsic and extrinsic motivational factors. Herzberg (1959) two factor theory as cited in Bassett-Jones and Lloyd (2005) argued that employees are motivated by internal values rather than values that are external to the work. In other words, motivation is internally generated and is propelled by variables that are intrinsic to the work…show more content…
Herzberg argued further that eliminating the causes of dissatisfaction (through hygiene factors) would not result in a state of satisfaction; instead, it would result in a neutral state. Motivation would only occur as a result of the use of intrinsic factors. Empirical studies (Kinnear and Sutherland, 2001; Meudell and Rodham, 1998; Maertz and Griffeth, 2004) have, however revealed that extrinsic factors such as competitive salary, good interpersonal relationships, friendly working environment, and job security were cited by employees as key motivational variables that influenced their retention in the organizations. The implication of this therefore is that management should not rely only on intrinsic variables to influence employee retention; rather, a combination of both intrinsic and extrinsic variables should be considered as an effective retention strategy.
Based on a review of the literature, many studies have investigated employees intentions to exist, for example Eskildsen and Nussler (2000) in their research suggested that employers are struggling to be talented employees in order to maintain a successful business. In the same bases, Mark Parrott (2000), Anderson and

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