Title Page:

Assignment Question: Write a report about a major human resource management (HRM) issue
affecting your organization or an organization you know well. The HRM issue you choose to
write about must be one of the following: job analysis and design, recruitment and selection, or
employee retention.

Word count: - 2598

Student name: - Stella Jennifer Ackon

Student number: - ABS0118058

Subject Name: - Strategic Human Resources Management (602SHRM)

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Executive Summary

Takoradi International Company (TICO) is facing a cancerous Human Resource (HR) problem
of employee turnover. It is having a devastating effect on its competitiveness in terms of keeping
a stable working staff with the requisite skills and knowledge and its competitiveness against
other similar organizations. It is becoming costly to the organization as it loses out on reaping its
investments on training of staff. The write up looks at potential HR practices that can help with
the retention of employees and ways to curb the tide and an improvement on the HRM issue, a
comparison of best practice using Cen Power. The writer also gives some recommendations on
how to deal with this issue.

The information and contents for this assignment were gathered from books, journals, lecture
notes, company documents and the internet.

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Content Table

Title page 1
Executive summary 2
Introduction 4
Overview of the Power Industry 4
Brief history of Takoradi International Company (TICO) 5
Analysis of the TICO HRM Issue 5
Need for change and improvement at TICO 7
Comparing TICO’s HRM Issue and Industry’s best practices (Cen Power Ghana) 8
Conclusion 10
Recommendations 10-11
References 12

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1. Introduction
Human Resource Management can be defined as a strategic and coherent approach to the
management of an organization’s most valued assets – the people working there who
individually and collectively contribute to the achievement of its objectives. (Armstrong,
2006)

Human beings, since the beginning of time, have needed to develop social practices that
utilize the talents and abilities of the people living in any community or work enterprise
to ensure the completion of work tasks which need to be done to enable that community
to survive. However, modern ‘human resource management’ might be sound, it is
important to recognize that it is an activity that deals with some very fundamental human
social, economic and political problems.

Strategic human resourcing and human resourcing work helps both shape the work
enterprise and contributes to its long-term survival without paying close attention to the
interests and priorities of the managers and business people who are in charge of such
activities. Strategic human resourcing is something done by human beings who are in no
way free to manage in any way they like but who, at the same time have certain key
choices they can make about how to deal with human resource resourcing matters. This
report therefore seeks to analyze the issue of employee retention. For the purpose of this
work, the writer focused more on the high rate of voluntary turnover of Takoradi
International company (TICO). Improvements justifications were given and comparison
of TICO to Cen Power’s best HR practices was done. Conclusion and recommendations
were also given to curb this disturbing HRM issue. This paper first looks at an overview
of the power industry in Ghana and goes on to give a brief background of TICO.

2. Overview of the Power Industry in Ghana

Power generation in Ghana has gone through a number of phases: starting with diesel
generators and stand-alone electricity supply systems owned by industrial mines and
factories, to the hydro phase following the construction of the Akosombo dam, and now

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 to a thermal complement phase powered by gas and/or light crude oil. However, Ghana
has committed itself to universal electricity access by 2020, the real challenge is the
capacity to meet this goal and, most important, to ensure that supply is reliable and
adequate.

2.1 Brief history of Takoradi International Company (TICO)

The Takoradi International Company (TICO) is a joint venture formed by Abu Dhabi
National Energy (TAQA) of United Arab Emirates (UAE) and the Volta River Authority
(VRA) of Ghana. TICO has a 90% ownership in the Takoradi 2 (T2) plant, which
generates electricity from a variety of fuels including tri-fuel compatible natural gas, fuel
oil or distillate-light crude. The remaining 10% is owned by the VRA. The power
produced from the facility is sold under a 25-year Power Purchase Agreement (PPA) with
the VRA. TICO received a Ghanaian parliamentary approval in July 2012 to convert the
facility from simple-cycle generation facility to a combined-cycle generation facility
which has increased the net generation capacity from 220 megawatts (MW) to
approximately 330MW with no increase in fuel consumption. (TICO/VRA Power
Purchase Agreement, 2012). TICO’s staff strength is about 80 comprising 75 locals and 5
expatriates.

TICO has a lot of HRM issues which has contributed to high employee turnover, the next
section gives a detailed analysis of the issues.

3. Analysis of the TICO HRM issue

Employee turnover refers to the severing of the relationship fully and finally between the
employer and the employee. It signifies the termination of the contract of employment
that hitherto has bound both parties in a work-based relationship of mutual obligation and
responsibility. Both employers and employees can terminate the contract of employment,
but in practice the majority of labour turnover is employee initiated. (Leopold, Harris.
2009) The Ghana Labour Act 2003, Act 651(8a and 15) gives both the employer and
employee the right to sever ties. In TICO, for example, of the 25 employees who left
their jobs since 2014, 21 left voluntarily.

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These workers moved to other power plants like, Cen Power, Ameri Power, Aksa Energy,
Cenit Energy to mention but a few. A few have also moved to other sectors rather than
the power industry. These workers were relatively experienced mechanical, electrical,
chemical engineers and other administrative staff who were masters in their various
specialization and great assets to the company.
Many workers left because of an acrimonious breakdown in the employment relationship.
This was for example, employees’ grievances of unfair pay structures, which did not
make room for growth and promotions. Workers could only move when there was an
opening available for a position internally, there was no obvious way for workers could
grow both financially and career-wise in the company. This situation made workers feel
stuck and put financial pressure on them, affecting cost-of-living. For example, once an
individual is employed as an auxiliary control room operator, there was no way that
individual could migrate to a senior control room operator, unless that position is vacant
for whatever reason before one could occupy that position; and this situation cut across
other departments (finance, HR/administration, maintenance, safety) in the company.

There was also the issue of no succession plan for employees, workers were not being
trained to take up higher responsibilities and takeover from managers who had left the
company. Lack of mentorship was also a huge problem for workers to deal with. The
company was not pairing more experienced workers in a discipline with someone less
experienced in a similar area. There were also no clear HR policies to address issues like
employee medicals, leave, risk and hazard allowances for technical and non-technical
staff; things were done haphazardly, no respect for educational qualifications, workers
who had high educational qualifications felt dissatisfied because, TICO was more
concerned with “ability to work” rather than giving recognition to educational
qualification to match the job descriptions and performance.

Due to poor communications there were unclear goal settings among employees. Job
descriptions and expectations were not communicated clearly which caused low morale
among them. Employees were losing trust in management because they were

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 unappreciated, disrespected and not given chances to use their creativity. These sent poor
signals to employees.

According to a strategic planning consultant Leigh Branham, there are other main reasons
why employees leave a company:

 Employees feel the job or workplace is not what they expected.

 There is a mismatch between the job and person.
 There is too little coaching and feedback.
 Employees feel devalued and unrecognized.
 Employees feel stress from overwork and have a work/life imbalance.
 There is a loss of trust and confidence in senior leaders.

What made matters worse in TICO was the fact that management failed to find the
underlying causes of these grievances to address them. Many workers thought it was
more deliberate on the company’s side. Employees frequent resignations could be
interpreted as a response to the company’s failure to act, whether through oversight or
more deliberate omissions.

4. Need for change and improvement at TICO

Voluntary turnover often involves competent employees leaving their positions. As a
result, voluntary turnover can be very expensive for an organization because of the costs
associated with recruiting and hiring a new employee. When employees leave, it is costly
for the business, it may cost nearly three times an employee’s salary to replace someone,
which includes recruitment, severance, lost productivity, and lost opportunities. It takes
time and money to find and train a replacement. That is why it is best for TICO to reduce
its turnover as much as possible.

There was an instance where a procurement manager resigned and took legal actions
against the company, on the grounds that it had been management’s unreasonable
behavior that had forced his departure. He was able to prove to the courts that the
circumstances were so intolerable that he left ‘under duress’. In so doing the procurement

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 manager was indicating that, rather than leaving voluntarily, it was management that had
to take responsibility for his departure. In this sense the court concluded that the
termination of employment was de facto ‘employer-initiated’.
The malice resulting from such episodes, if not dealt with by management, may have an
adverse impact on the contribution of the remaining workforce. Hence the need for
change and improvement in the situation.

5. Comparing TICO’S HRM issue to industry best practices (Cen Power)

From the above analysis of the TICO HRM issue, it shows that employees chose to
vacate their jobs because they may have felt dissatisfied with their jobs and other
demotivating factors. Noe et al (2015) also states that one of the reasons for voluntary
turnover could be the temptation to accept the offers of a highly competitive market. The
power industry is now becoming very competitive with plants like Cen Power, Ameri
Power which use some of the industry best practices to manage employee retention:

i. Measuring and monitoring job satisfaction

TICO’s attempts to measure job satisfaction was by solely relying on workers'
self-reports. There is a vast amount of data on the reliability and validity of many
existing scales as well as a wealth of data from companies that have used these
scales.
Cen Power on the other hand, measures job satisfaction by using its existing
scales of job satisfaction data and allowing for comparisons across other power
industries. Established scales are excellent places to begin if employers wish to
assess the satisfaction levels of their employees.
One standardized, widely used measure of job satisfaction is the Job Descriptive
Index (JDI) which is being adopted by Cen Power. The JDI emphasizes various
facets of satisfaction: pay, the work itself, supervision, co-workers, and
promotions. Other scales exist for other companies who want to get even more
specific about different facets of satisfaction. Clearly there is no end to the
number of satisfaction facets that one might want to measure, but the key in
operational contexts, where the main concern is retention, is making sure that

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 scores on whatever measures taken truly relate to voluntary turnover among
valued people. For example, satisfaction with co-workers might be low, but if this
aspect of satisfaction is not too central to employees, it may not translate into
voluntary turnover. Similarly, in an organization that bases raises on performance,
low performers might report being dissatisfied with raises, but this may not reflect
any operational problem. Indeed, the whole strategic purpose of many pay-for-
performance plans is to create this type of dissatisfaction among low performers
to motivate them to higher levels of performance.

ii. Survey-Feedback Interventions

Regardless of what measures are used or how many facets of satisfaction are
assessed, a systematic, ongoing program of employee survey research should be a
prominent part of any human resource strategy for a number of reasons. First, it
allows the company to monitor trends over time and thus prevent problems in the
area of voluntary turnover before they happen. TICO does not engage in any
employee survey research.
On employee development survey, for example, Cen Power found exactly this
kind of trend in its survey of engineers, technicians and other operators. The
company responded to this feedback by creating the career initiatives that allowed
its employees to develop new skills and grow professionally. The program
provided time off and financial support, some of which was obtained from
seeking a study leave to workers who wanted to go back to school and obtain
higher degrees. Many former assistant technicians became fully certified
technicians, many technicians became engineers. Cen Power not only wound up
having a higher skilled staff, in addition, turnover was reduced by 20% after the
initiation of the program.

Conducting an organizational opinion survey is not something that should be

taken lightly. If people fail to see any timely actions taken on matters identified
as problems in the survey, satisfaction is likely to be even lower than it would be
in the absence of a survey. However, Cen Power also took strategic retention

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 policies to consider surveying people who were about to leave the company (Exit
interviews with departing workers) this was one of their valuable tools for
uncovering systematic concerns that are driving retention problems. If properly
conducted, an exit interview can reveal the reasons why people are leaving.
6. Conclusion
From the above, it can be concluded that though management is entitled to initiate the
departure of its employees that do not fulfil the company’s requirements, whether by
dismissal, redundancy or retirement, it is also acknowledged that employees too have the
right to initiate their own departure from their employing organization (Act 651 (8a and
15) but a focus on reducing turnover will save the company some money, increase
production thereby maximizing profit and having the right number of employees with
the requisite competencies at the right place and the right time to meet organizational
needs. Consequently, this places emphasis on the need for TICO to manage its employee-
initiated decisions to leave, so that the right people will stay rather than leave.

7. Recommendations
Voluntary turnover can be minimized by measuring and monitoring employee levels of
satisfaction with critical facets of job organization, and then address any job problems
identified. Below are some recommendations for a company like TICO to utilize in order
to keep workers motivated and satisfied to retain them:

 Training employees reinforces their sense of value through training, employers

help employees achieve goals and ensure they have a solid understanding of their
job requirements.

 A mentoring program integrated with a goal-oriented feedback system provides a

structured mechanism for developing strong relationships within an organization
and is a solid foundation for employee retention and growth.

 No matter what the size of the organization, communication is central to building

and maintaining credibility. It is important for employees to know that the
employer is really listening and responds to (or otherwise acknowledges)
employee input.

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 Offering things like competitive salaries, profit sharing, bonus programs, pension
and health plans, paid time off, and tuition reimbursement sends a powerful
message to employees about their importance at the organization. The rewards
given to employees must be meaningful in order to impact their perception of the
organization and therefore have a marked influence on its retention efforts.
Moreover, if an organization promises a reward, it should keep that promise.

 It is important for companies to give feedback and coaching to employees so that

their efforts stay aligned with the goals of the company and meet expectations.
During an employee’s first few weeks on the job, an employer should provide
intensive feedback. Employers should also provide formal and informal feedback
to employees throughout the year.

 An organization should provide workshops, software, or other tools to help

employees increase their understanding of themselves and what they want from
their careers and enhance their goal-setting efforts.

 Employees will go the extra mile if they feel responsible for the results of their
work, have a sense of worth in their jobs, believe their jobs make good use of
their skills, and receive recognition for their contributions.

 Develop strong relationships with employees from the start to build trust.
Employees have to believe that upper management is competent and that the
organization will be successful. An employer has to be able to inspire this
confidence and make decisions that reinforce it. An employer cannot say one
thing and do another. For example, an employer shouldn’t talk about quality and
then push employees to do more work in less time. In addition, employers need to
engage and inspire employees by enacting policies that show they trust them, such
as getting rid of authoritarian style of management.

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References
Armstrong, M. (2006). Human Resource Management Practice. London: Kogan Page Limited.

John Leopold, L. H. (2009). The Strategic Managing of Human Resources. England: Pearson
Education Limited.

Maame Esi Eshun, J. A. (2016). A review of the trends in Ghana's Power Sector. Energy,
sustainability and Society, 1-9.

Raymond A. Noe, J. R. (2015). Human Resource Management: Gaining a Competitive

Advantage. New York: McGraw Hill Education

Sammer, J. (2018, February 16). What to Do When Workers Hit the Top of Their Pay Range.
Retrieved from www.shrm.org: https://www.shrm.org

Yazinski, S. K. (2009, August 3). Compliance Tools for HR Professionals. Retrieved from
HR.BLR.com: https://hr.blr.com

The Ghana Labour Act (2003) Act 651

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