To analyze the impact of high employee turnover on organizational performance and success
Background of the study
In the strategic business environment, firm can attain success only when it has highly skilled and talented workforce. Further, in the service industry such as restaurant satisfaction level of customers are highly influenced from the type and quality of services offered by personnel. Thus, it is highly required for the business organizations to retain skilled and talented personnel for long time frame. Australian Bureau of Statistics show that in restaurant, cafe and catering industry turnover has increased by 9% which is not a good indicator of firm. Further, due to high turnover sales revenue of restaurant also declines by 8.6% respectively. It shows that employee turnover situation has high level of impact on the productivity and profitability aspect of firm (Turnover in the restaurant, cafe and catering industry rises amid growing cost pressures, 2017). Thus, for getting the desired level of outcome or success it is highly required for the firm to undertake effectual measure for making control on the situation of high employee turnover. This proposal is based in Rockpool which is one of the leading restaurant chains of Australia (Rockpool dinning group, 2017). In this, proposal will shed light on the effect that employee turnover has on the effectiveness, growth as well as performance of Rockpool’s.
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Research aims and objectives
Aim of the present study is to analyze the reasons due to which employee turnover increases and thereby affects the performance of Rockpool restaurant. By taking into account such aim following objectives have been drafted which in turn helps in conducting study in the right direction.
- To determine the effects of employee turnover on organizational effectiveness
- To identify the factors influencing employee turnover in the organization
- To find out the measures that would help retain the employees in the organization.
Rationale of the study
The rationale behind the conducting such investigation is to assess the influence employee turnover on firm’s performance. It is considered as major issue because it directly affects cost, productivity and profitability of firm. In addition to this, employee turnover becomes the major issue now because now large number of personnel in Australia is leaving organization operated in restaurant sector including Rockpool. In this regard, such research study will clearly present the causes due to which employee turnover increases. Besides this, it will also depict the extent to which organizational effectiveness is affected from the aspect of employee turnover. Thus, such study will help in assessing the ways through which situation of employee turnover can be controlled to the large extent.
Significance of the study
The present study and its outcome will offer benefit top several authorities such as such as scholars, firms that are operated in retail sector etc. Moreover, now high employee turnover in restaurant sector is the major issue that affects profit margin of firm and thereby growth of economy. Due to this, scholars show their interest toward such topic to a great extent and lay emphasis on conducting study on same. Thus, study on employee turnover and its related impact on firm’s performance will help other scholars in understanding research topic or area. Further, study will also helps Rockpool and other restaurants of Australia in taking suitable action for reducing employee turnover.
Factors that may cause of high employee turnover
According to the views of Huang and et.al., (2016) employee turnover implies for the number of workers who are leaving organization. In the business unit, it is highly required for the employer to assess the reasons due to which situation of employee turnover arises. Moreover, without having information about such aspect it is not possible for the firm or manager to undertake strategic action for improvement. Wong and et.al., (2016) stated that culture of business unit is one of the main aspects due to which situation of employee turnover occurs. Moreover, there is high and significant correlation-ship takes place between organizational culture and employee happiness. Thus, employee becomes more productive when culture of business unit is highly supportive. However, on the critical note, Li, Kim and Zhao (2017) depicted that in the recent times individuals prefer to stay in the organization which offers opportunity to them in relation to career growth and advancement. Thus, now employees prefer to work with the organization for longer duration that conducts training and development session. Moreover, training aspect offers opportunity to the personnel to build their potential and enhance competency level to a great extent. Thus, employee turnover increases when firm does not provide growth opportunities to personnel.
In accordance with the views of Miller Jr (2017) work-life imbalance is another main cause due to which absenteeism and turnover of employees increases. Sometimes, due to having excessive work load and timing aspect it is highly difficult for the personnel to manage their personal and professional life. Thus, such aspect compels personnel to a great extent in relation to leaving the organization. On the other side, Thomas, Brown and Thomas (2017) argued that employees take decision in relation to leaving organization when job does not meet their expectation level. Moreover, some individuals give more preference to job that is highly challenging. The rationale behind this, employees can build distinct image in the mind of others only when they do something different. Thus, it can be said that when personnel are not satisfied with their current job then it may result into high level of employee turnover within the firm.
By doing investigation, Cho and et.al., (2017) found that low salary and lack of other benefits are other main aspects which in turn may result into high employee turnover. Moreover, now living standard of people increased to a great extent as compared to before times. In this, employees prefer to work and join the organization which offers high salary as well as monetary and non-monetary benefits. Further, Boswell, Gardner and Wang (2017) argued that ineffectual leadership is one of the causes due to which employees leave business unit. Moreover, without having sound leader personnel face difficulty in assessing the manner in which they need to perform activities. Thus, effectual leadership is highly required to retain personnel for long term. In the study, Herman, Huang and Lam (2013) presented that workplace conflict is considered as main aspects that have greater impact on employee satisfaction and retention. Now, business units lay high level of emphasis on teamwork with the motive to maximize employee productivity and profitability. Hence, conflicts are usual when individuals work in a team because different individuals have varied views. Thus, it can be stated that conflicting situation at workplace closely influences the satisfaction level of personnel. Moreover, with the high level of mental stress individuals are not in position to work in the best possible way. Hence, all such are the main reasons due to which employee turnover increased significantly.
Impact of employee turnover on the effectiveness and performance of an organization
Katsikea, Theodosiou and Morgan (2015) said that employee turnover negatively affects the organizational growth and performance. Moreover, when employee turnover is high within the firm then it does not have enough human resources for delivering high quality services to the customers. The reason behind this, existing personnel have better idea regarding the offering of services to customers as compared to the new one. For instance: In the restaurant sector, customers prefer to dine at the place that ensures quick delivery of services. Thus, if business unit failed to maintain proper human resources then restaurant would not able to offer satisfactorily services to the customers. This aspect shows that productivity and profitability aspect of firm is highly based on the availability of skilled personnel.
In contrast to this, Huang and et.al., (2016) mentioned that in the situation of high employee turnover manages have to devote their valuable time in the recruitment of new personnel. Besides this, managers also have to conduct training session when new personnel are recruited within the firm. Along with this, experienced employees are highly productive over others. Thus, it can be said that employee turnover have significant influence on the growth and performance of an organization. Besides this, Wong and et.al., (2016) employee turnover situation imposes high level of cost in front of business organization. Moreover, in the case of appointing new personnel business entity has to invest money in training and development activity. By taking into account such aspect it can be depicted that situation of employee turnover affects organizational effectiveness in terms of both financial and non-financial aspect.
In research, inductive and deductive are the main two approaches that can be undertaken by scholar for evaluating issue. There is a significant difference takes place between the aspects of inductive and deductive approach of research. Moreover, deductive approach of research starts with hypothesis framing and ends with the testing of same through the means of existing theoretical framework. In addition to this, such approach of research is highly associated with quantitative investigation (Fabozzi, Huang and Zhou, 2010). Unlike deductive, inductive approach of research offers suitable outcome or result when qualitative investigation is conducted. Thus, selection of research approach is getting highly influenced from the type or nature of study.
In this, researcher lays high level of emphasis on developing effectual framework or theory by investigating issue. In order to evaluate the impact of employee turnover on the performance of Rockpool restaurant scholar will employ inductive approach of research. On the basis of such aspect, by making assessment of problem or data set researcher will generate new theory.
Similarly, to the approaches, philosophies of research can be distinguished into two types such as interpretivism and positivism. Both such philosophies of research are also highly associated with the type of investigation such as qualitative and quantitative. In the case of interpretivism philosophy, scholar interprets qualitative data set by referring the specific theories related to subject area (Eriksson and Kovalainen, 2015). On the other side, under positivism philosophy scholar presents solution by analyzing and evaluating the numeric facts as well as realistic figures. Such philosophy of research provides suitable solution when quantitative investigation is conducted. Hence, for making assessment of employee turnover and its impact on performance aspect researcher will undertake interpretivism philosophy. On the basis of such aspect, by evaluating qualitative data regarding employee turnover and its impact on Rockpool’s performance researcher will present solution.
Data is one of the essential elements of research study which in turn closely influences the appropriateness and effectiveness of outcome. Thus, care must be taken by the researcher while selecting the sources of data collection. Basically, data collection sources can be distinguished into two types such as primary and secondary. Hence, primary sources include survey, interview, observation and focus group (Bergold and Thomas, 2012). Thus, by undertaking such sources scholar can collect highly appropriate and fresh data for the study. On the other side, already published articles, books and journals fall in the category of secondary data. Through the means of internet surfing and library secondary data can easily be gathered by researcher.
In the current study, to identify the causes of employee turnover and its meanwhile impact on the performance of Rockpool restaurant data will be gathered from both primary as well a secondary sources. Hence, to gather primary data scholar will conduct survey on 10 employees of Rockpool restaurant through the means of questionnaire. Such questionnaire will contain questions regarding issues about productivity, profitability, training and development etc. Thus, by sending questionnaire on the mail-id of managers primary data will be collected by researcher. Besides this, scholar will also make assessment of books, journals and scholarly articles that are related to employee turnover and organizational effectiveness. This in turn enables scholar to prepare brief thesis and thereby develops better understanding about issue.
Sample selection is required when scholar takes decision in relation to conducting survey. Moreover, there are several factors or aspects due to which it is not possible for the researcher to target whole population (Schmidt and Hunter, 2014). In this, by taking into account suitable sampling technique either probabilistic or non-probabilistic scholar can select suitable sample. With the motive to select suitable sample by reducing the level of biasness to a great extent scholar will undertake simple random sampling technique. Hence, by considering such technique scholar will select 10 managers from Rockpool restaurant. Thus, by sending questionnaire to such personnel researcher would become able to get appropriate information.
Data analysis technique is highly significant because it has direct impact on the outcome of results of issue. Hence, technique and the manner in which data is evaluated closely influence the effectiveness of investigation (Bryman and Bell, 2015). Moreover, data analysis is the process that is highly concerned with determining suitable solution of issue by analyzing the gathered data set. Techniques of data analysis highly vary according to the type of investigation conducted (Bernard and Bernard, 2012). Thematic analysis is usually conducted by the researcher in the case of qualitative investigation. On the other side, SPSS tools and techniques are used by the researcher to get suitable solution from quantitative data set.
Thus, for analyzing the causes related to increasing situation of employee turnover and its associated impact on Rockpool’s effectiveness thematic technique will be used. Hence, by preparing several themes on the basis of questionnaire and responses given by respondents data will be analyzed by the researcher. Besides this, scholar will support all the findings of data set through brief thesis prepared in literature review section. In addition to this, scholar will also develop graphs and charts for presenting data set in an effectual way. This in turn develops better understanding about results or findings.
Reliability and validity
For the maintenance of reliability and validity aspect in research scholar will comply with the below mentioned aspects:
- Use of updated details: To ensure high level of validity scholar will evaluate the books and scholarly articles published after the period of 2009. The rationale behind this, recently published data present clear and reliable view of study. Thus, by taking into account such aspect scholar has decided in relation to considering update data sources while doing investigation.
- Undertaking relevant sources: Suitable brief thesis can be prepared only when highly relevant data sources are undertaken by the researcher. Thus, researcher will consider the articles that are related to employee turnover and organizational effectiveness. Hence, by using such related sources will conduct literature review and thereby would become able to evaluate primary data findings more effectually.
- Use of protected sources in data collection: In order to present the reliable view of study scholar will access to highly protected sites such as copyright. Moreover, sources that are protected through the means of copyright serve highly reliable and authentic information about topic.
Researcher can enhance the effectiveness and quality of work by following the ethical aspects or considerations are as follows:
- Taking permission before survey: Ethics entail that before initiating survey researcher should inform the concerned organization and respondents. Thus, researcher will approach to Rockpool and managers who are being selected as respondents for taking permission. On the basis of such aspect, after making assessment of respondent’s willingness in relation to participating in survey scholar will send questionnaire to the selected respondents. This in turn shows that researcher has ethically conducted study with the aim to present the suitable view of study.
- Inclusion of reference list and doing citation: Scholar will also include reference list in the project and thereby presents sources from where data is taken. In addition to this, scholar will do citation in report for giving credit to author.
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High level of care has been taken by the researcher while selecting research tools and techniques. However, there are some limitations that closely influence the outcomes of study such as:
- Time: In research, time is one of the main factors that researcher need to keep in mind while doing research or investigation. Moreover, if suitable results are not presented with the specified time period then research and its findings do not have high level of importance Thus, to overcome such weakness researcher will lay high level of emphasis on preparing timeline. Hence, by performing activities according to predetermined timeline scholar would become able to complete study on time.
- Monetary resources: Enough availability of monetary resources is highly required to conduct investigation more effectively and efficiently. Due to the lack of having enough resources researcher will not apply SPSS tools and techniques. Hence, to reduce such limitation researcher will undertake thematic perception test technique. On the basis of such aspect, by preparing themes data will be analyzed by the researcher.
- Respondents selected for survey: In the research study, only 10 managers will be considered for survey purpose. Thus, such number of respondents is highly lower which in turn places impact on the outcome of evaluation. However, buy taking into account simple random sampling such respondents will be selected. This in turn reduces the significance of overall evaluation to a great extent.
You may also like to read:
- Bergold, J. and Thomas, S., 2012. Participatory research methods: A methodological approach in motion. Historical Social Research/Historische Sozialforschung, pp.191-222.
- Bernard, H.R. and Bernard, H.R., 2012. Social research methods: Qualitative and quantitative approaches. Sage.
- Boswell, W. R., Gardner, R. G. and Wang, J., 2017. Is retention necessarily a win? Outcomes of searching and staying. Journal of Vocational Behavior. 98. pp.163-172.
- Bryman, A. and Bell, E., 2015. Business research methods. Oxford University Press, USA.
- Cho, Y. N. and et.al., 2017. The Role of Emotions on Frontline Employee Turnover Intentions. Journal of Marketing Theory and Practice, 25(1), pp.57-68.
- Eriksson, P. and Kovalainen, A., 2015. Qualitative Methods in Business Research: A Practical Guide to Social Research. Sage.
- Fabozzi, F. J., Huang, D. and Zhou, G., 2010. Robust portfolios: contributions from operations research and finance. Annals of Operations Research. 176(1). pp.191-220.
- Herman, H.M., Huang, X. and Lam, W., 2013. Why does transformational leadership matter for employee turnover? A multi-foci social exchange perspective. The Leadership Quarterly.