Volume 24 Number 8/9 2001

Biographical Notes

Susan Curtis is Senior

Lecturer in Human Retaining Employees - The Fast
Resource Management,
Department of Business
and Management Studies,
Manchester Metropolitan
Track to Commitment
University, Crewe & by Susan Curtis, and Dennis Wright
Alsager Faculty, Crewe
Campus, Crewe Green
Road, Crewe, Cheshire Staff Turnover
CW1 5DU.
Dennis Wright is Lecturer It may be that in certain industries, high levels of staff turnover are viewed as
in Human Resource
Management, Staffordshire necessary. Nightclubs and fast food restaurants need young staff for the sake of
University, Beaconside, their corporate image, for example, 71 percent of McDonald’s employees are un-
Stafford ST18 0AD.
der 20 years of age (Royle, 2000). But for most industries, factors such as quality,
customer service and expertise are more important than ensuring that the staff fit
within a narrow age band. High staff turnover can damage factors such as quality
and customer service which provide competitive advantage, thereby inhibiting
business growth or even causing a decline in the level of business.

There are substantial variations in turnover levels for different industries. In

retailing around 19 per 100 employees leave each year, whilst in hotels, restau-
rants and pubs this figure is around 38 per 100 employees (Cully, 1999). People
leave their jobs for health reasons, family and other personal reasons, career
moves and retirement, and this turnover provides the opportunity for existing
staff. The cost of replacing leavers can be high, the cost of recruiting new staff
can be up to 150 percent of annual salary for key staff. In addition to financial
costs there is the loss of skills, knowledge, experience and the investment in
training. Also, there is the disruption to the work and staff as well as the effect on
staff morale. The financial costs associated with turnover can be categorised as
follows:
• Separation costs (for example, administration time, pay for leave not
taken, time for exit interviews, managers’ time).
• Temporary replacement costs (for example, overtime, agency fees, ad-
ministration time, training).
• Recruitment and selection costs (for example, advertising, agency
fees, administration time for processing applications, conducting in-
terviews, administering selection tests).
• Induction and training costs.

(Source: Institute of Employment Studies, 1997)

Employees are more prone to leave their new jobs within the first few weeks
of starting them at any other time (IDS, 2000). How then can new employees,
who need to be retained because they already represent a considerable invest-
ment in terms of the above costs, be persuaded to feel committed to their new em-
ployer in the shortest possible time?

The Nature of Commitment

Commitment has been defined as “the strength of an individual’s identification

with and involvement in an organisation” (Mowday et al., 1979). The concept

59
Management Research News

can be broken down into three components:

1. A desire to maintain membership in the organisation
2. A belief in and acceptance of the values and goals of the organisation,
and
3. A willingness to exert effort on behalf of the organisation.
If a person feels commitment to an organisation therefore, he or she has a
strong identification with it, values membership, agrees with its objectives and
value systems, is likely to remain in it, and, finally, is prepared to work hard on its
behalf.

Other authors (Allen and Meyer, 1990) have distinguished between:

• Affective commitment: the person’s emotional attachment to his or her
organisation
• Continuance commitment: a person’s perception of the costs and risks
associated with leaving his or her current organisation. There are two
aspects to continuance commitment: the personal sacrifice that leaving
would involve and a lack of alternatives available to the person.
• Normative commitment: a moral dimension, based on a person’s felt
obligation and responsibility to his or her employing organisation.
In order to get employees committed quickly, they should feel emotionally
attached to the organisation, feel that leaving would involve a personal sacrifice
and that they have an obligation or responsibility to stay. It may sound like reach-
ing for the moon to achieve these in just a few weeks, but obviously many people
do feel very good about their new jobs within the first few days of starting. So
how do we go about getting people to accept their new roles, colleagues and em-
ployer quickly and happily?

The Fast Track to Commitment

Affective commitment: an emotional attachment to the organisation should not, in

theory, be too difficult to achieve. New starters have willingly chosen the organi-
sation, applied for the job, jumped through all the hoops of the selection proce-
dure and have resigned from their previous job or have thankfully left
unemployment behind them. They are arriving in their new place of work full of
enthusiasm and hope, and if the following elements are positive, they will
quickly develop that all-important attachment.

Group cohesion: fitting in with the team or with colleagues is important to the de-
velopment of an emotional attachment at work. Social events, teambuilding ac-
tivities and a culture of co-operation, rather than competition, will all assist in
making the new starter feel at home.

Dissatisfaction and conflict with managers and supervision: a common reason

for resignations is the feeling that managers are not providing appropriate leader-
ship, or treating people unfairly or bullying their staff. Managers and team lead-
ers should be selected for their leadership qualities, receiving training in
leadership skills and methods of resolving conflict, and senior management

60
Volume 24 Number 8/9 2001

should introduce procedures for handling grievances and disciplinary proce-

dures.

Feedback on performance: the `feel good factor’ concerning one’s job is very im-
portant for committed employees. Individuals should be clear about their respon-
sibilities and performance standards, given positive feedback on how well they
are doing and feel that performance assessments and appraisals are fair.

Employee involvement and participation: making individuals feel that their ideas
and opinions are valued can be done in a variety of ways. Staff should be in-
formed of changes and plans for the future and involved in shaping and discuss-
ing their implementation. Individuals will be willing to give their ideas and
feelings about day-to-day operations through team briefings, meetings, sugges-
tion boxes and informal discussions with approachable managers or teamleaders.
The involvement of staff communicates the extent to which they are valued, or-
ganisations which use many staff suggestions not only benefit financially but are
building up their employees’ self-esteem and commitment to the organisation.

Continuance Commitment: the feeling that leaving would involve a personal

sacrifice should also not be too difficult to achieve if all of the above components
designed to achieve affective commitment are in place and the individual consid-
ers their employer to be better than the competition. How then can the employer
compete with other employers for their employees’ affections?

Pay: this should be competitive with the external labour market and fair in the in-
ternal labour market. Pay levels should be reviewed and compared with other
employers regularly, jobs should be evaluated to provide for equitable grading
decisions, clear explanations should be provided concerning the link between
performance and reward, performance related pay schemes should be regularly
reviewed and employees should be involved in developing and operating job
evaluation and performance-related pay schemes.

Career development: dissatisfaction with career prospects is a major cause of

turnover. Often there is little that employers can do about people needing to move
on to improve their careers, especially in flatter organisations. Career opportuni-
ties can be provided by an employer by:
- providing employees with wider experience
- introducing more systematic procedures for identifying potential such
as assessment or development centres
- encouraging promotion from within
- developing more equitable promotion procedures
- providing advice and guidance on career paths
Flexible work options: in recent years, achieving a better work-life balance has
become increasingly important for many employees. Some organisations have
improved retention by offering staff more flexible working options and by imple-
menting other family-friendly policies. Initiatives might include workshops
aimed at achieving a better work-life balance, access to a range of domestic serv-
ices, gradual return to work programmes for maternity leavers, advisory service

61
Management Research News

on childcare, unpaid career breaks and extended parental leave.

Employee benefits: rewarding loyalty often involves introducing a benefits pack-

age that improves with service. Benefits such as company cars and company-
paid private medical insurance are often an expected feature of benefits packages
for senior staff. For the majority of staff the introduction of flexible or `cafeteria’
benefits which involve employees choosing from a menu of benefits may be the
easiest and cheapest way for the employer to satisfy the needs of their employees.

Normative commitment: a feeling of obligation and responsibility to the em-

ployer will vary between individuals, given similar circumstances. Individuals
who have been employed by their organisation for many years would resign to-
day if they could afford to retire or find another job, whereas some individuals
who have only been with their employer for a short time are guilt-ridden if they
have to resign for unavoidable reasons. The elements which might help to build
up a feeling of obligation include:

Jobs: the job should be rewarding. It should be designed to maximise skill vari-
ety, task significance, autonomy and feedback, and should provide opportunities
for learning and growth. A very varied and interesting job will take time to learn
and will provide the job-holder with a feeling of ownership of the job - that no-
one else can fill his or her shoes immediately. The job-holder will not willingly
leave such a job and may also feel that he or she is causing their employer diffi-
culties in filling the post if they resign.

Training: new employees can go through an `induction crisis’ if they are not
given adequate training when they join the organisation. They may perceive that
their employer has not fulfilled their obligation or responsibility to them if they
are unable to carry out the work. They will, in turn, feel a reduced obligation to
stay. Conversely, new employees who are greeted with an interesting and infor-
mative induction programme, attached to a mentor and informed about a plan of
future training for them will feel much more enthusiastic about staying with their
employer. Existing employees should also have their skills and competences en-
hanced, and be assisted to acquire new skills and competences so that they can
make better use of their abilities, take on greater responsibilities and undertake a
greater variety of tasks.

Leaving

Employees will inevitably leave and this should be planned for in order to maxi-
mise benefits both to individuals and the organisation. Exit interviews will pro-
vide useful data on employees’ perceptions of the organisation as an employer
and where problems may lie. For employees who are leaving due to retirement,
provision should be made for a gradual change from working on a full-time basis
to retirement. All employees should be treated fairly and with dignity and com-
passion on leaving.

Summary

Managers and other key staff should possess an understanding of the value of
employee retention and commitment and how it can be achieved. Policies and ac-
tivities to encourage staff loyalty and stability should be integrated into the cul-

62
Volume 24 Number 8/9 2001

ture and everyday life of the organisation, so that committed employees are the
norm, rather than the exception. Fully committed individuals have a desire to
maintain membership in the organisation, believe and and accept the values and
goals of the organisation, and are willing to exert effort on behalf of the organisa-
tion. They should be treated as a precious resource to be nurtured and retained for
the benefit of all members of the organisation.

63
Management Research News

References

Allen, N.J. and Meyer, J.P. (1990) “The measurement and antecedents of affec-
tive, continuance and normative commitment to the organization,” Journal of
Occupational Psychology, Vol. 22, pp.453-474.

Cully, M., Woodland, S., O’Reilly, A. and Dix, G. (1999) Britain at Work: As de-
picted by the 1998 Workplace Employee Relations Survey, Routledge, London.

IDS Study 692, July 2000 “Employee Retention: How to hold on to what you’ve
got.”

Institute for Employment Studies, Report 337, 1999 “Keeping the best: A practi-
cal guide to retaining key employees.”

Mowday, R., Steers, R., and Porter, L. (1979) “The measurement of organiza-
tional commitment,” Journal of Vocational Behavior, Vol. 14, pp.224-247.

Royle, T. (1999) “Recruiting the acquiescent workforce, a comparative analysis

of McDonald’s in Germany and the UK,” Employee Relations, Vol. 21, No. 6,
pp.540-555.

64