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Employee retention strategies in IT sector- with special reference to
S&V Pvt. Ltd
Dr. Vaishali Rahate, Datta Meghe Institute of Management Studies, Mrunali Hadke
(Student), Vishal Kumar Prakash -Consultant- Data Management, S&V
Abstract:
Employee Retention is one of the major challenges faced by IT companies in India. As
employees are the key assets for any organization , they try to adopt many strategies to hold
down the attrition rate. Thus a holistic approach is necessary to understand the factors
controlling employee turnover in IT Industries by the HR Managers.
The present study intend to examine the reasons for employees leaving the Organization,
factors which makes them stay back, their approach towards work, work relationships and
their expectations from the Organization . The study was conducted in S&V company. Factor
analysis was done to extract the important factors affecting retention of employees. It was
found that Quality of Work Life and Job Flexibility and Security factor plays important role
in retention strategies for employee’s intention to stay at the organization.
1. INTRODUCTION:
Employee Retention in IT Industry:
The IT industry has always been in forefront for revenue and employment generation.
Because of high profits and rewarding market size, lot of small and big companies have
entered into this market, and therefore a major chunk of young people are taking their careers
into IT sector. Along with the major players in IT sector like Infosys, TCS, Wipro, there is a
huge number of medium and small scale IT industries in India. As there are many IT
Industries, employees have an option of switching over their jobs very frequently. Today’s
new generation Employees are not only looking for a decent pay package but need attractive
working environment , challenging tasks, support for higher studies and perks to motivate
them. The moment they feel that their expectations are not met, they start searching for a new
job. Usually the employees leave job prominently because of the Skills mismatch with the job
profile, stress & workload , Work life imbalance and above all, the pay package.. The
drawbacks of employee attrition are Cost of turnover (including hiring costs, training costs
Science, Technology and Development
Volume VIII Issue XII DECEMBER 2019
ISSN : 0950-0707
Page No : 795
and productivity loss), Loss of company’s knowledge (knowledge about the company,
customers, current projects and past history), Interruption of customer service, Turnover leads
to more turnovers, Goodwill of the company.
In such a scenario, organizations face a lot of difficulty, as a high turnover rate may hamper
productivity. To avoid such state, organization have to adapt retention strategies to make
employees continue for satisfactory period in which the employee is able to contribute ,
execute, achieve and perform. The primary concern is which strategies should be adopted,
which works well with all the employees. Every individual is different and is motivated by
different job and personal factors. Keeping abreast the above mentioned facts, this research
paper follows a line of exploration on the key retention strategies which can work well for all
employees of IT Sector.
2. LITERATURE REVIEW
SR.
NO. TITLE AUTHOR DATE FINDINGS
1.
Employee Retention-
A Real Time
Challenges in Indian
IT Sector
Manju
Dhillon
August
2017
This paper concludes that companies
felt the importance of retention
strategies and accepted that without it
they won’t be able to survive in
competitive market. Some benefits like
lucrative salary, flexible timing, better
work environment and better career
growth helps in retention.
2.
Emerging Employee
Retention Strategies
in IT Industry
Rashmi
Badjatya
Rawat
April
2013
The reasons, employees leave the
organization is very different from the
reasons because of which they stay in
the organization. It is very much like the
Herzberg’s two factor hygiene theory.
The hygiene factors are the one without
which the employee will leave the
organization such as salary. But the
motivating factors are one which will
actually pursue them to stay in the
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Volume VIII Issue XII DECEMBER 2019
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organization like Recognition and Work
Life balance.
3. Employee Retention
in IT Industry
Alena
Rohava
Novemb
er 2017
The focal point of the research was the
correlation between the employee job
satisfaction factors and the level of
turnover intentions. It was decided to
conduct the questionnaire, utilizing the
Job Satisfaction Survey, developed by
64 Paul Spector, and modified by
adding several items, related directly to
the turnover intentions in order to define
the possible correlations between these
factors.
4. Employee Retention
Strategies: IT Industry
Leena James
&Lissy
Mathew
Septemb
er 2012
Authors mentioned that turnover rates
of 25 percent-35 percent had been
reported in Fortune 500 companies over
the past five years, while a supply-
demand gap in the IT labour market
conceivably exacerbates the IT-
retention problem.
5. Retaining Employees
in Indian It Sector
Dr.Satpal&
Manju
Dhillon
March
2016
This study brings out that work
environment, family problems,
compensation, relation with superiors
are the prominent factors that may be
considered while planning a job change
by an IT professional. Every company
wants to retain its employees but when
they get trained have tendency to move
to other organization for better
prospects.
6.
A Study On Employee
Retention Strategies in
Leading IT
Dr. G.
Balamurugan
& R.Abinaya
March
2016
In this study it is understood that, there
are three retention variables which
influences most for retaining employees
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Volume VIII Issue XII DECEMBER 2019
ISSN : 0950-0707
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Companies At Trichy are Career advancement and
opportunities, Superior support, Work
environment and the remaining two
retention variables such as Work
pressure, Rewards and recognition are
least influencing for employee retention
in IT companies.
7.
Employee Retention
Strategies in Indian
Software Industry
G Ajay
Kumar &Dr.
M. Srinivasa
Reddy
March
2016
In the study, six employee retention
strategies were identified as
Management/ Organisational Strategies,
Orientation Strategies, Communication
Effectiveness Strategies, Reward and
Recognition Strategies, Employee
Benefit Strategies and Employees Ideas
and Suggestion Strategies.
8.
A Study On Employee
Retention Factors
Influencing IT
Professionals Of
Indian IT Companies
And Multinational
Companies In India
Minu
Zachariah
Novemb
er 2012
There are no significant differences in
responses between IT professionals of
Indian and Multinational Companies in
India, with respect to most of the
demographic variables like age, gender,
educational qualification, income, total
experience in previous organization and
number of jobs changed. However,
there was significant difference in
responses between the two groups with
respect to experience in the current
Organization, current position in the
Organization and training programs
undergone.
9.
Critical Factors
Affecting Retention:
Case of the Indian IT
Industry
Pooja
Wadhwa
&Saroj Koul
January
2012
There are two strategies that are most
useful. Firstly, to provide salary hikes in
accordance with industrial standards.
Secondly, to recruit those only who has
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long-term orientation towards the
organization or those who will stay in
company for longer time period. This
paper identifies that factors related to
compensation issues have the highest
effect on attrition.
10.
The Effect of Training
on Employee
Retention
Waleed
Hassan, Amir
Razi, Rida
Qamar,
RidaJaffir&
Sidra Suhail
Decembe
r 2013
Most professionals, both men and
women want to have job training. It was
discovered that job training is necessary
for every employee. For the better
encouragement and loyalty of
employees, organizations should induce
reward giving phenomena. In this way,
employees are provided with an
environment where they are able to
embrace career growth and professional
skill’s development.
3. Company Profile:
Founded in 2008, S&V is an IT services company with expertise in data related services.
The company has developed a gamut of services to help our clients take the next step. Our
exemplary track-record of implementing open-source Odoo ERP has earned us the badge of
‘Odoo Ready partners’. While our spectrum of data services, mapped to SAP at its core, has
made us the official partner of SAP for the Middle-East region.
S&V is expert in all data related services and management solutions.
4. Research Methodology
The research design is a basic research and it is a field survey through self-administered
questionnaires.
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4.1 Objective Of the Study
The main Objective of the study is to examine the factors influencing the retention of IT
professionals in S & V.
1. To study the various factors that influences employee retention at S & V.
2. To explore the influence of the following determinants on employee retention:
a. Career opportunities
b. Salary Increment
c. Reward & Recognition
d. Work life balance
4.2 DATA COLLECTION
Data collection was done through both primary and secondary source.
(A) Primary source:
Questionnaire
The questionnaire framed for the research study is a structured questionnaire in which all the
questions are predetermined before conducting the survey. The questionnaire for the research
was framed in a clear manner such that it enables the respondents to understand and answer
the question easily.
(B) Secondary source:
Websites
Books
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4.3 SAMPLE SIZE
Sample size was limited to 80 employees.
4.4 DATA ANALYSIS AND INTERPRETATION
From the above pie-chart, we can observe that 88% of employees at S & V believes’ that
Rewards and recognition are important factor to continue with the organisation.
Interpretation:
Rewards and recognition under retention strategies have significant impact on intention to
stay.
0%2%
0%
10%
88%
Rewards and Recognition
Very Unimportant
Unimportant
Neutral
Very Important
Important
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To find out various factors for Retention
KMO and Bartlett's Test
Kaiser-Meyer-Olkin 0 Sampling Adequacy.
.745
Bartlett's Test of Sphericity
Approx. Chi-
Square
665.871
Df
180
Sig.
.000
The Kaiser-Meyer-Olkin test indicates that the data is suitable for factor analysis (KMO =
0.745 which is close to 1) and Barlett’s test shows there are significant relationships
between the variables (Sig. = 0.000 < 0.05). A factor analysis was conducted to determine if
there were any underlying dimensions in a questionnaire.
Rotated Component Matrix:
Another important aspect that needs mention is the Rotated Component Matrix. While
deciding how many factors one would analyse is whether a variable might relate to more
than one factor. Rotation maximizes high item loadings and minimizes low item loadings,
thereby producing a more interpretable and simplified solution. There are two common
rotation techniques - orthogonal rotation and oblique rotation. While orthogonal varimax
rotation that produces factor structures that are uncorrelated, oblique rotation produces
factors that are correlated. Irrespective of the rotation method used, the primary objectives
are to provide easier interpretation of results, and produce a solution that is more
parsimonious.
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Rotated Component Matrix
Factors Component
1 2 3 4 5 6 7
Social Support .032 -.206 -.097 .111 -.037 .892 .170
Supervisor Support .263 .817 -.026 .087 -.007 -.192 -.158
Stress At Job -.380 .315 .374 .364 -.242 .606 .037
Role Ambiguity .388 .038 .120 -.235 -.045 .879 .174
Role Conflict .205 .110 -.307 -.012 .088 .531 .728
Work Load -.631 -.179 .505 -.279 -.571 -.058 .863
Leave Benefits .581 -.230 .266 -.538 -.361 .221 .085
Health And Related
Benefits .649 .023 -.152 .483 .057 -.343 .200
Retirement Plan -.504 -.099 .055 -.124 .593 .217 .670
Opportunities For
Personal Growth . 830 -.127 -.086 . 148 .788 .006 .317
Job Security -.151 .873 -.307 -.019 -.010 -.083 .052
Fair Pay .207 .096 -.502 .776 -.022 .082 -.373
Promotion
Prospectus -.063 .066 .273 -.016 .826 -.003 .132
Equal Growth
Opportunities .099 .018 .250 .795 .150 .332 .173
Rewards And
Recognition .863 -.127 -.200 -.169 .046 .103 .000
Training And
Development
Opportunities
-.106 .223 .852 -.672 .077 .006 -.043
Mentoring/Coaching
Sessions .110 -.499 .076 .173 .604 -.241 -.381
Flexible Work Time .043 -.065 .185 .278 -.126 .009 .768
Employees
Suggestion Plans -.140 .192 .215 -.182 .765 -.071 -.175
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Annual Performance
Appraisal -.337 .723 .302 -.210 .072 .001 -.091
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From Table, .it is evident that the 7 factors extracted explain 82.144% of the total variance.
Total Variance Explained
Compon
ent
Initial Eigenvalues Extraction Sums of Squared
Loadings
Rotation Sums of Squared
Loadings
Total % of
Variance
Cumulat
ive % Total
% of
Variance
Cumulat
ive % Total
% of
Variance
Cumulati
ve %
1 4.589 21.852 21.852 4.589 21.852 21.852 3.491 16.622 16.622
2 3.130 14.906 36.758 3.130 14.906 36.758 2.795 13.308 29.930
3 2.458 11.704 48.462 2.458 11.704 48.462 2.523 12.015 41.945
4 2.307 10.985 59.446 2.307 10.985 59.446 2.284 10.877 52.822
5 1.886 8.983 68.429 1.886 8.983 68.429 2.266 10.790 63.612
6 1.725 8.215 76.644 1.725 8.215 76.644 1.955 9.308 72.920
7 1.155 5.500 82.144 1.155 5.500 82.144 1.937 9.224 82.144
8 .985 4.689 86.833
9 .570 2.716 89.549
10 .535 2.550 92.098
11 .450 2.141 94.239
12 .311 1.479 95.718
13 .283 1.347 97.064
14 .200 .952 98.016
15 .158 .755 98.771
16 .123 .584 99.354
17 .069 .328 99.683
18 .036 .171 99.854
19 .016 .077 99.931
20 .012 .058 99.988
21 .002 .012 100.000
Extraction Method: Principal Component Analysis.
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The variables with the highest loadings on a factor, define the factor as highlighted in Table.
By referring to the content of these variables it is possible to determine the underlying
factors-
1. Benefits and Rewards
2. Organizational Culture and System
3. Training and Development
4. Compensation
5. Career Growth
6. Quality of Work Life
7. Job Flexibility and Security
Factors Variables addressed New factor
Explained
Variance
(%)
1
Leave Benefits, Health And Related,
Opportunity Awards And
Recognition
Benefits and Rewards
16.622
2
Supervisor Support, Job Security,
Annual Performance Appraisal
Organizational Culture and
System
29.930
3
Training And Development
Opportunities Training and Development
41.945
4 Fair Pay, Equal Growth Compensation 52.822
5
Promotion Prospectus,
Mentoring/Coaching, Employee
Suggestion Plans
Career Growth 63.612
6 Social Support, Stress At Job, Role Of
Ambiguity Quality of Work Life 72.920
7 Role Of Conflict, Work Load,
Retirement Plan, Flexible Work Time Job Flexibility and Security 82.144
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ISSN : 0950-0707
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Quality of Work Life , Job Flexibility and Security have significant relationship with
intention to stay.
We can find from the above table that the Quality of Work Life and Job Flexibility and
Security factor plays important role in retention strategies for employee’s intention to stay at
the organization.
5. CONCLUSION:
We have done the analysis and interpretation after completing the research procedure we
found that the mean deviation of the employee retention is higher, so we arrived at following
conclusion-
Salary increment influences the employee retention of the company
Location preferences influences the employee retention
Career opportunities influence the employees to leave the company which results in
employee retention
Regards and recognition influences the employee retention
Work environment of the company also influences the employee retention
6. SUGGESTIONS
Although the results are positive, we can see that mean of factors like career
opportunities and recognition are less than other factors. So, management should give
stress on promotion and recognition strategies so that it will help in retaining
maximum pool of talent.
Effective human resource management must be practices at both strategic and day to
day levels.
HR management practices must reflect company policy as to how it will manage and
relates to its employee.
HR should understand the employee problems and solve them effectively.
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Volume VIII Issue XII DECEMBER 2019
ISSN : 0950-0707
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Books:
Carsen A. J., HR How To: Employee Retention, CCH Knowledge Point Publication
(2005)
Kothari C. R., Research Methodology Methods and Techniques, Second Edition, New
Age International Publishers (2008)
Websites:
http://en.wikipedia.org/wiki/Employee_retention
http://guides.wsj.com/small-business/hiring-and-managing-employees/how-to-retain-
employees/
http://www.slideshare.net/dineshpinkey/employeeretention
http://sandv.biz/
dspace.tiss.edu › jspui › handle By S. Pandey, 2002
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Volume VIII Issue XII DECEMBER 2019
ISSN : 0950-0707
Page No : 808