Human Resource Management: Gaining a Competitive Advantage Chapter 10 Employee Separation and Retention McGraw-Hill/Irwin Copyright © 2010 by the McGraw-Hill Companies, Inc All rights reserved Learning Objectives  Distinguish between involuntary and voluntary turnover and discuss how eachcan be leveraged for competitive advantage  Listand apply major elements that contribute tothe perceptionof justiceto disciplineand dismissal  Specify the relationship between job satisfaction and job withdrawal and identify sources of job satisfaction  Design and use a survey feedback intervention program to promote retention of key personnel 10-2 Introduction  To compete, organizations must ensure:  Good performers are motivated to stay  Chronically low performers are allowed, encouraged or if necessary, forced to leave  Types of Turnover:  Involuntary turnover—initiated by the organization (often among thosewho would preferto stay)  Voluntary turnover—initiated by employee (often those the company would prefer to keep) 10-3 Managing Involuntary Turnover  Employment-at-will doctrine- in the absence of a specific contract, either an employer or employee could sever the employment relationship at any time  Violence in the workplace caused by involuntary turnover has become a major organizational problem in recent years  A standardized, systematic approach to discipline and discharge is necessary 10-4 Principles of Justice  Outcome fairness-the judgement that people makeregarding outcomes receivedrelative to outcomes received by others with whom they identify  Procedural justice- focuses on methods used to determine the outcomes received  Interactional justice- refers to the interpersonal nature of how the outcomes were implemented 10-5 Progressive Discipline Components of Discipline Programs 10-6 Determinants of Interactional Justice 1 Explanation Explanation 2 Social Social sensitivity sensitivity 3 Consideration Consideration 4 Empathy Empathy 10-7 Stages of ADR Arbitration Mediation Peer Review Open Door Policy 10-8 Employee Assistance Programs  EAPs attempt to ameliorate problems encountered by workers who are drug dependent, alcoholic, or psychologically troubled  EAPs are usually identified in official documents published by the employer  There are several issues in controversy regarding EAPs 10-9 Outplacement Counseling  Helps displaced employees manage the transition from one job to another  Services such as job search support, résumé critiques, job interviewing training and networking opportunities may be provided in-house or through an outside source  Aimed at helping people realize that other opportunities exist 10-10 Managing Voluntary Turnover – Job Withdrawal  Progression of Withdrawal Theory-dissatisfied individuals enact a set of behaviors in succession to avoid their work situation  categories: behavior change physical job withdraw psychological job withdraw  Withdrawal behaviors are related to one another, and partially caused by job dissatisfaction 10-11 Job Dissatisfaction- Job Withdrawal Process Causes Job dissatisfaction - Personal disposition - Tasks&roles - Supervisors& coworkers - Pay&benefits Job Dissatisfaction Manifestations job withdrawal - Behavioral change Job Withdrawal - Physical job withdrawal - Psychological job withdrawal 10-12 Behavior Change  An employee's first response to dissatisfaction would be to try to changethe conditions that generate dissatisfaction  When employees are unionized, dissatisfaction leads to an increased grievances  Employees sometimes initiate change through whistle-blowing - making grievances public by going to the media or government 10-13 Physical Withdrawal   ways a dissatisfied worker can physically withdrawal from the organization: Leave the job Internal transfer Absenteeism Tardiness Companies spend 15 %of payroll costs to make up for absent workers on average 10-14 Job Satisfaction and Job Withdrawal  Job satisfaction is a pleasurable feeling that results from the perception that one's job fulfills one's important job values  aspects of job satisfaction: values perceptions Importance  Frame of Reference serves as a comparison for other points and provides meaning 10-15 Unsafe Working Conditions Pay and Benefits Personal Dispositions Sources of Job Dissatisfaction Tasks and Roles Supervisors and Coworkers 10-16 Unsafe Working Conditions  Each employee has a right to safe working conditions under the Occupational Safety and Health Act of 1970 (OSHA)  Financial bonuses linked to specific safety related goals help keep employees focused and pay for themselves over time  Firms that emphasize safety send workers a clear signal that they care about them 10-17 Sources of Job Dissatisfaction  Personal Dispositions  Negative affectivity is a dispositional dimensionthat reflects pervasive individual differences in satisfaction with any and all aspects of life  Tasks and Roles  The nature of the task itself is the key predictor of job dissatisfaction  Job Rotation  Prosocial Motivation 10-18 Sources of Job Dissatisfaction  Supervisors and Coworkers  A person may be satisfied withhis or her supervisor and coworkersdue to: – shared values, attitudes, and philosophies, – strong social support  Pay and Benefits  For many people, pay is a reflection of self worth, so pay satisfaction takes on critical significance when it comes to retention 10-19 Survey Feedback Interventions  Surveys:  emphasize overall satisfaction  assess the impact ofpolicy changes  allow the company to compare itself with others in the same industry  allow the company to check for differences between units and benchmark “best practices.”  If people fail to see timely actions taken on matters identified as problems in the survey, satisfaction is likely to be lower than it would be in the absence of a survey  Any strategic retention policy has to consider surveying people who are about to become ex-employees 10-20 Summary  Involuntary turnover reflects a separation initiated by the organization  Voluntary turnover reflects a separation initiated by the individual It can be minimized by measuring, monitoring and surveying, then addressing problems found in the surveys  Organizations can gain competitive advantage by strategically managing the separation process  Retaliatory reactions to organizational discipline and dismissal decisions can be minimized 10-21 [...]...Managing Voluntary Turnover – Job Withdrawal  Progression of Withdrawal Theory-dissatisfied individuals enact a set of behaviors in succession to avoid their work situation  3 categories: 1 behavior change 2 physical job withdraw 3 psychological job withdraw  Withdrawal behaviors are related to one another, and partially caused by job dissatisfaction 10-11 Job Dissatisfaction- Job Withdrawal Process... Withdrawal Process Causes Job dissatisfaction - Personal disposition - Tasks&roles - Supervisors& coworkers - Pay&benefits Job Dissatisfaction Manifestations job withdrawal - Behavioral change Job Withdrawal - Physical job withdrawal - Psychological job withdrawal 10-12 Behavior Change  An employee's first response to dissatisfaction would be to try to changethe conditions that generate dissatisfaction  When... has to consider surveying people who are about to become ex-employees 10-20 Summary  Involuntary turnover reflects a separation initiated by the organization  Voluntary turnover reflects a separation initiated by the individual It can be minimized by measuring, monitoring and surveying, then addressing problems found in the surveys  Organizations can gain competitive advantage by strategically managing... are unionized, dissatisfaction leads to an increased grievances  Employees sometimes initiate change through whistle-blowing - making grievances public by going to the media or government 10-13 Physical Withdrawal   4 ways a dissatisfied worker can physically withdrawal from the organization: 1 Leave the job 2 Internal transfer 3 Absenteeism 4 Tardiness Companies spend 15 %of payroll costs to make... make up for absent workers on average 10-14 Job Satisfaction and Job Withdrawal  Job satisfaction is a pleasurable feeling that results from the perception that one's job fulfills one's important job values  3 aspects of job satisfaction: 1 values 2 perceptions 3 Importance  Frame of Reference serves as a comparison for other points and provides meaning 10-15 Unsafe Working Conditions Pay and Benefits... send workers a clear signal that they care about them 10-17 Sources of Job Dissatisfaction  Personal Dispositions  Negative affectivity is a dispositional dimensionthat reflects pervasive individual differences in satisfaction with any and all aspects of life  Tasks and Roles  The nature of the task itself is the key predictor of job dissatisfaction  Job Rotation  Prosocial Motivation 10-18 Sources... Personal Dispositions Sources of Job Dissatisfaction Tasks and Roles Supervisors and Coworkers 10-16 Unsafe Working Conditions  Each employee has a right to safe working conditions under the Occupational Safety and Health Act of 1970 (OSHA)  Financial bonuses linked to specific safety related goals help keep employees focused and pay for themselves over time  Firms that emphasize safety send workers a. .. overall satisfaction  assess the impact ofpolicy changes  allow the company to compare itself with others in the same industry  allow the company to check for differences between units and benchmark “best practices.”  If people fail to see timely actions taken on matters identified as problems in the survey, satisfaction is likely to be lower than it would be in the absence of a survey  Any strategic... Dissatisfaction  Supervisors and Coworkers  A person may be satisfied withhis or her supervisor and coworkersdue to: – shared values, attitudes, and philosophies, – strong social support  Pay and Benefits  For many people, pay is a reflection of self worth, so pay satisfaction takes on critical significance when it comes to retention 10-19 Survey Feedback Interventions  Surveys:  emphasize overall... measuring, monitoring and surveying, then addressing problems found in the surveys  Organizations can gain competitive advantage by strategically managing the separation process  Retaliatory reactions to organizational discipline and dismissal decisions can be minimized 10-21