CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND OF THE STUDY

In the organization the Human Resources are the life blood of life. It is difficult for the organization to compete in the current era of competition without the loyal and competent Human Resource Manager loyal employees are the most productive and a source for the development of the organization and vice versa. It becomes challenge for the Human Resource Managers to retain the employees for long period and to minimize the turnover in the organization high turnover of employees in the organization increases the cost of hiring new workforce and decrease the productivity. An organization can gain the competitive advantage due to retaining of qualified, productive and loyal work force. The turnover is the most focused area by the scholars, academicians, researchers and the human resource managers. The outcome of the increased level of turnover in the organization is also in the form of indirect cost like burden on the existing workforce, loss of social capital and low morale. (Des & Shaw, 2001).

If an employee turns down an offer of employment or resigns an appointment after only a few weeks or months on the job, it turns out a painful derangement and disruption of business services for the company; in many cases, because some valuable training typically would have been invested on the individual in question. Many corporations plan to retain their employees for as long as it is economically and financially feasible for their businesses and they equally have good retirement plans and healthcare benefits for their workers. Some also offer sponsorships for postgraduate trainings locally or overseas, including college grants for staff members’ families.

For the past few decades, employee retention has been of interest to researchers and employers in various fields.  In order to remain competitive in the rapidly expanding global economy and to keep pace with technological advances requires a workforce with robust institutional knowledge; therefore, employee retention is of great importance to business and academic communities (Benko & Weisberg, 2007). Research from the past by Egan, Yang & Bartlett 2004 has shown that job satisfaction is strongly and inversely associated with employee’s intention to leave an organization. In other words, more satisfied employees are less likely to seek a new job, with a new employer.  With this, studying the factors that are associated with job satisfaction is essential. Two general categories are believed to influence employee job satisfaction: demographic characteristics and organizational culture.  Demographic characteristics include age, gender, education, income, and tenure of employment.

There have been several researches aimed at exploring the relationship between job satisfaction and turnover on employees. Only few have critically explored this relationship across several industries and occupations. The analysis will contribute to the literature by examining the relationship and the difference between job satisfaction and employee turnover. In addition, this study investigated how satisfaction with organizational culture influences job satisfaction, and its subsequent impact on employee turnover.

1.2    STATEMENT OF THE PROBLEM

In order for an organization to be successful, it must continuously ensure the satisfactorily of their employees. Organization with more satisfied employees tends to be more effective and productive worker (Robbins, 2002). Man power in an organization is the most important asset or resource to enable organization to do their business while without it the organization will not be able to implement the developed business plan and retaining them has become a challenge to organizational management because of varied employee needs. It is difficult for management to decide what makes employees happy to understand and to provide the employee needs. Employee turnover demands serious management attention because of it high performance levels, it puts pressure on the organization scarce resources which turn to be costly, people tend to change jobs within a year rather than choose to grow in one.

The gap is that many studies done by different scholars show that there is a strong relationship between job satisfaction and employee turnover, but the studies did not critically show the factors that bring about job dissatisfaction of the employees. Past researches have shown that job satisfaction is closely related to individual reactions to work environment. Therefore, this study investigated job satisfaction and employee turnover using GlaxoSmithKline plc as a case study.

1.3    RESEARCH QUESTIONS

The following are some of the questions which this study intends to answer:

i)                   what are the factors that bring about job satisfaction and employee turnover at GlaxoSmithKline plc?

ii)                 what are the effects of satisfaction with nature of work on employee turnover at GlaxoSmithKline plc?

iii)               what are the effect of satisfaction with supervision on employee turnover at GlaxoSmithKline plc?

1.4    OBJECTIVES OF THE STUDY

The objective of the study is to examine the factors that affect employees’ turnover at GlaxoSmithKline plc and the specific objective are to:

i)                   to investigate the factors that bring about job satisfaction and employee turnover at GlaxoSmithKline plc

ii)                 to inquire the effects of satisfaction with nature of work on employee turnover at GlaxoSmithKline plc

iii)               to examine the effect of satisfaction with supervision on employee turnover at GlaxoSmithKline plc

1.5    RESEARCH HYPOTHESIS

The research hypotheses to be tested include:

i)                   there is a significant relationship between pay and employee turnover at GlaxoSmithKline plc

ii)                 there is no correlation between supervision and employee turnover at GlaxoSmithKline plc      

iii)               there is a significant correlation between promotion and employee turnover at GlaxoSmithKline plc      

1.6    SIGNIFICANCE OF THE STUDY

The study will contributes towards generation of new knowledge and new insights to the existing knowledge about the roles of job satisfaction on employee turnover in an organisation. Employee job satisfaction is important for an organisation to achieve its goals by increasing employees work performance and productivity and reducing employee turnover and absenteeism. Therefore, the study will be useful for business owners, organisations, managers, Human Resource Managers and people with responsibilities of personnel matters, as well as other concerned bodies to identify possible solutions for factors affecting employees’ job satisfaction resulting into labour productivity.

 1.7     SCOPE OF THE STUDY

            Although, the study was designed to investigate the job satisfaction and employee turnover in an organization but in other to clearly understand the topic very, it looked at the factors that can bring about job satisfaction and dissatisfaction in any organizations. The factors include: prompt payment of salary, supervision, hours of work, promotion etc. The study used the staff of GlaxoSmithKline plc as a case study and therefore was strictly limited to the organization.

1.8     LIMITATIONS OF THE STUDY

The researcher was faced with the problem of reluctance to giving out information by the staff of GlaxoSmithKline plc as a result of the closed supervision they are experiencing at work.

1.9      DEFINITION OF TERMS

The following terms were used in the course of this study:

Employee: a person who works for another person or for a company for wages or a salary

Human Resource Manager: are involved with recruitment, training, career development, compensation and benefits, employee relations, industrial relations, employment law, compliance, disciplinary and grievance issues, redundancies etc. in an organisation.

Job satisfaction: is the level of contentment a person feels regarding his or her job. 

Turnover: financial ratio that measures the efficiency of a company's use of its assets in generating sales revenue

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