13-14 SEMI Personnel Resourcing CASE: RETENTION MANAGEMENT Case requirements: 1 . Conduct an analysis of information contained in Tanglewood employee satisfaction surveys and exit interviews to determine which factors are likely to lead to premature employee separations. 2. Use information provided in the case to determine if the turnover is functional or dysfunctional for Tanglewood as a whole 3. Suggest additional forms of information that Tanglewood might want to collect from their employees to improve their understanding of the turnover situation. . Describe concrete steps Tanglewood might take to reduce employee turnover. Case Objectives Voluntary turnover is the final stage of the employment relationship. When voluntary turnover occurs, employees who have been screened, selected, socialized, and trained in the organization depart despite the organization’s attempts to keep them. This clearly can be a considerable problem for an organization, since all the costs associated with staffing a new employee now must be incurred again for a new employee.
However, voluntary turnover is not always a negative event. When an individual who has a poor productivity profile, negative attitudes towards the Job and rganization, and superiors leaves, it can be a positive outcome for the organization and the (former) employee. In this case you will review information related to turnover in managerial positions for Tanglewood and determine whether managerial turnover is more likely to be a positive or negative event for this organization.
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You will also use techniques discussed in your readings to develop suggestions for Tanglewood to ensure they are retaining the employees they want to keep to the greatest degree possible. The Situation There was a 34% annual turnover rate among store managers and assistant store anagers in Washington during the past year. This is an unacceptably high number from Tanglewood’s point of view. Such high levels of turnover are likely to create a feeling of instability among lower level employees, and generally indicate that the organization will have difficulty creating effective long-term goals in these stores.
Unfortunately, this high turnover among managerial employees is even more problematic because of the costs involved. Managerial survey is a very sensitive issue for Tanglewood. The process of finding good managers obviously begins with ecruiting. A very large number of individuals must be found during the recruiting phase because only 11% of external applicants are selected to become assistant store managers and only 10% of external applicants are selected to become store managers.
After hiring, every manager, regardless of their status as internal or external hires, is put through a two month training program that includes trips to the corporate offices, mentoring from other store managers and the regional manager, and culminating in a public welcoming ceremony at the store where the manager will work. There is a downside to the process of training managers. Excellence in managerial performance is often observable from the outside as well because competitors can walk into the stores and see which ones are functioning well.
It is common for particularly successful store managers to receive offers from other companies that are trying to capture some of the Tanglewood “essence. ” The Employee Satisfaction Survey The Tanglewood employee relations department administers a survey every year to assess the attitudes of employees towards several aspects of their employment. Although the purpose of the survey is to collect baseline information on employee attitudes, Marilyn Anchley believes that these survey responses will be an ideal method to track the reasons why some managers are more likely to leave.
The annual employee survey is conducted in June by Emerson and Wood. Boxes of blank surveys are sent to regional managers, who then use central routing to send surveys to each store. The survey was initiated to give employees an opportunity to express their feelings about key topics that Tanglewood think will benefit employees. Given the overall organisational culture, employee satisfaction is an important issue. Emerson and Wood send bulk e-mails to all store managers to encourage them to get a 100% response rate from their employees. However, it is common for less than 50% of the employees to complete surveys.
An example of the survey is contained in the Appendix. The survey asks questions that can be broken down into four major topics, as follows: Supervisor satisfaction The supervisor satisfaction questions encourage employees to describe their relationship with their immediate supervisor and the extent to which they are atisfied with the direction they receive on a day to day basis. Tanglewood spends a great deal of money training supervisors on the “Tanglewood way’ so they are especially concerned that these principles are carried out in practice.
Work satisfaction Work satisfaction relates primarily to the degree to which employees believe that their tasks are interesting, fulfilling, and contribute to a meaningful life. The participatory system at Tanglewood puts a great deal of responsibility on employees to make their work enjoyable, but the corporate offices still want to make certain that very effort is made to ensure that employees have the freedom to do work they enjoy. Pay satisfaction Tanglewood realise that because they place a great deal of responsibility in employees’ hands, they need to ensure that employees feel they are been adequately paid for this additional effort.
At the same time, because Tanglewood spend a great deal of time and energy creating an enjoyable workplace, they believe that they should not make pay too much a focus of their human resources activities. The company typically are a market leader in pay relative to discount retailers like Asda or WalMart, but pay slightly less than stores like Marks and Spencer, BHS or John Lewis. Benefits satisfaction The benefits package offered by Tanglewood consists of a pension scheme and a basic childcare allowance. Additional benefits for higher level employees include 80% tuition reimbursement for undergraduate education.
Within the corporate human resources function, Marilyn Anchley has been increasingly critical of the lack of innovative benefits offerings. The consultants, Emerson and Wood, recently proposed that there be an overhaul of the organisation’s benefits because they do not create uch of an impression on employees. Regional data Table 7. 1 contains summary information from the employee surveys, the “competition index,” and turnover. Because the most pressing concern is managerial turnover, only data for store managers and assistant managers is displayed.
The data are collected by the staffing services division and then summarised across stores for a five-year period. Having these long-term aggregated data makes certain that the results are reasonably robust. The competition index is a measure of the number of local businesses that might draw employees from Tanglewood. The scale ranges from 1 to 10, with higher values indicating more competition. Some of the factors that go into the development of the competition index include the number of other retail establishments in the area, the total square feet of retail available, and the number of other Tanglewood stores.
This measure was not specifically developed for turnover analysis, but the corporate office believes that it probably is a good indication of the number of alternative organisations that might want to hire Tanglewood’s managers. Region Work Supervisor Pay Benefits Competition Turnover Total atisfaction satisfaction satisfaction satisfaction Index Rate Turnover Eastern Washington Western Washington Northern Oregon Southern Oregon Northern California Montana and 2. 8 3. 9 4. 4 3. 6 4. 8 2. 0 3. 4. 5 3. 8 7. 8 6. 8 0. 33 0. 27 0. 41 0. 24 0. 48 0. 29 165 135 148 Wyoming Colorado Utah Nevada New Mexico Arizona 2. 5 3. 3 3. 5 2. 4 4. 6 3. 7 4. 2 7. 6 0. 36 0. 46 0. 28 0. 39 130 212 106 125 101 172 Table 7. 1 Turnover Data Across Locations Correlations for individual surveys Donald Penchiala has also developed a correlation matrix that describes the elationship between surveys and performance indicators. This is similar to what you will have learned about selection and validation.
Penchiala thinks the same methods can be used to assess turnover as can be used to assess selection methods, since turnover is “selection in reverse. ” These data are available only for 153 managerial employees across the entire chain over time. To ensure that the data are valid, only one year of information is used, so that the same managers are not being counted multiple times. The final row presents correlations between the performance ndicators and turnover as well. Remember that turnover is a negative outcome.
A negative relationship between satisfaction and turnover means that those with a positive attitude toward the Job are less likely to turnover. This also means it generally is preferable to see negative correlations between performance indicators and satisfaction, because it means that those with higher levels of performance are less likely to leave the organization. Table 3. 2 Correlations between survey data and performance indicators Citizenship Correlation 0. 15 p-value 0. 06 Absence -0. 17 0. 2 Performance