, EXAM PREPARATION FOR IOP3706
LEARNING UNIT 1: INTRODUCTION: PSYCHOLOGY OF PERSONNEL RETENTION
1.1 EMPLOYEE TURNOVER INTENTIONS
Reasons include:
Problems with any HR/ personnel-related practises & process i.e.
o Inappropriate recruitment & selection methods
o Poorly-designed/ uncompetitive remuneration & reward systems
o Ineffective grievance & disciplinary procedures
External factors e.g. competition for labour/ “war for talent” also contributes
School of thought on turnover:
labour market/economic school of turnover: focuses on factors external to org i.e.
unemployment, wage differentials & availability of alternative jobs in local, national/global econ
The psychological school of thought on turnover: focuses on individuals & decisions to
quit/stay relating to personnel/ labour turnover to factors i.e. job satisfaction, organisational
commitment & employee’s engagement.
Forms of turnover:
Functional: all resignations welcomed by employer. Stem from individuals poor performance/
failure to fit in comfortably with org/ departmental culture.
Involuntary: occurs when employees is, e.g., fired as a result of poor performance/ laid off
owing to company downsizing. Considered inevitable & possibly even beneficial
Voluntary: competent & capable employee leaves to work elsewhere & generally costly to org.
losing valued employee= reduces org productivity & increases expenses associated with
recruiting & training a replacement.
Factors that influence employee turnover:
Outside factors: relates situations where someone leaves for reasons unrelated to their work.
Most common- moving away when spouse relocated or difficulty coping balancing work-family
Push & pull factors: pull- change careers, career mobility opportunities i.e. promotion outside
org, maternity leave & job transfer of spouse; push- level of pay, lack of career development
opportunities, unmet needs i.e. org fit, no support from management, working conditions/
stress of job. Push is dissatisfaction with work leading to unwanted turnover whereas pull leave
to improve living standards/ better career development opportunities
Factors influencing job & occupational embeddedness: embeddedness – totality of forces that
keep people in current employment situations :. Job & occupational embeddedness- totality of
forces that keep people in their present occupations. 3 forces:
o Fit: extent persons job & meshes/ compliments other areas of theirs lives
o Links: extent individuals ties with other people & activities at work
o Sacrifice: ease that links can be broken i.e. what have to give up if they left current position.
Greater the fit, the no. of links & degree of sacrifice; the greater the forces towards job
embeddedness. Some of the push& pull factors strongest influence on embeddedness:
, Macroeconomic conditions: poor economic conditions make financially more difficult to
accumulate resources to invest in new occupational training also increases job insecurity
& decrease no. of new positions in company
Employment equity & affirmative action: social & legal policy have increased educational
& employment opportunities for designated groups by reducing barriers to entry/
providing resources for entry.
Permeability of occupational mobility structures & industry growth: reduce barriers to
entry but also increase workers expectations to successfully shift into new career path.
Compensation policies: structure of pension & insurance benefits strongest effect on
embeddedness. , don’t want to give up on sunk cost.
Work/life conflict: factors leading to more external job mobility are predictability of time
demands & support in resolving work-life conflict.
Unmet expectations: also a push factor related to psych contract i.e. based on reciprocal
expectations & obligation of employers & employees. State thereof depends on degree
obligations & expectations are met, perceived fair + equitable & trust will be met in future.
Turnover from unmet expectations reduced by providing applicants with realistic job previews
The psychological contract: categorised broadly
o Relational contracts: broad, open-ended exchanges of relatively intangible things i.e. loyalty
& commitment in return for longer-term job security
o Transactional contracts: more specific & exchange much more explicit & tangible factors like
amount of pay in return for specified level of staff performance.
Balancing individual and organisational needs: is essential in the retention
Psych contract describes implicit rather than explicit exchange relationship between employers
& employees. Concerned with unwritten expectations relate to concepts i.e. fairness & honesty,
security & certainty, recognition & opportunity
The psychological contract & Career mobility: can contribute to retention of talented employees.
Voluntary turnover related to career mobility.
Intra-organisational mobility: Different forms of movement along the hierarchy, the
functional/technical dimension and radial mobility
o Hierarchical: primarily vertical as individual’s mover from entry-level position with org to
middle, in some cases senior/ executive level. Moves accompanied by increase in pay &
status
o Functional/technical: either enter functional speciality and continue throughout entire career
developing technical expertise OR move across functional speciality.
o Radial mobility: as in become more trusted & valued by org, consequently given greater
access to inner core. While hierarchical movement- move towards inner circle but not
automatic but dependent on level of trust in org for individual.
Inter-organisational mobility: focuses on globalisation, its influence on employee careers, &
boundary less career
, o Global careers becoming less limited by boundaries- refers to crossing national boundaries in
course of ones work, globalisation refers to compression of world & intensification of
consciousness of world as whole.
o Globally people seen shifting from organisation based careers to career managed by
individuals as active agents
o Self-initiated cross border career moves an integral part of changes associated with notion
“boundary less career” suggests freedom to change ones employment to whatever may
better fit to broader life constraints& preference.
o Employee turnover process of “disengagement” from org that can take days, weeks/ months
i.e. voluntary turnover intentions & reduced embeddedness likely influenced by attitudes of
lack of job satisfaction/ commitment.
1.2. JOB SATISFACTION AND ORGANISATIONAL COMMITMENT
Job satisfaction & organisation commitment closely related, but distinct. Satisfied employees tend to
be committed. 2 affected by factors:
Pay satisfaction: refers to employees feelings about what deserve & based comparison of want to
receive
Promotion Satisfaction: feelings about promotion policy & execution
Satisfaction With Supervision: feelings about superior- competent, supportive, respectful etc.
Co-Workers Satisfaction: feelings about fellow employees- same as above
Work Satisfaction: feelings about actual tasks- whether challenging, interesting, meaningful
Perceived good fit with above tend to be satisfied with jobs, & remain @ org and engage with
organisational citizenship behaviour (OCB) i.e., tasks employees perform not formally required.
Organisational commitment defined as desire of employee to remain a member of org. employees
not committed engage in “withdrawal behaviour” i.e., set of actions performed (absenteeism,
lateness) to avoid work situation. Consists of three elements:
- Attitude: acceptance & belief in org values
- Behaviour: willingness to exert effort on behalf of org
- Motivation: strong desire to remain in org.
Different forms of org commitment: emotional attachment, economic necessity & moral obligation.
TABLE 7.2: The 3 types of organisational commitment
Overall Organisational Commitment: What makes someone want to stay with their current
organisation?
Affective commitment Continuance commitment Normative commitment
Staying because you want to Staying because you need to Staying because you ought to
Friends work in office, miss Due for promotion soon. Supervisor invested so
them if left. Will advance as quickly at much time mentoring,
Current job duties rewarding. new company? training, showing ropes
Enjoy coming to work each Salary & benefits= nice helped out of jam on a
morning, really like house & spouse has a good number of occasions. How
atmosphere; fun & relaxed. job here. could leave now?
cost of living is higher in this Organisation gave a start.
new They hired when others
thought wasn't qualified
Emotion-based reasons Cost-based reasons Obligation-based reasons
Individual variables: influence on org commitment
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