Power of Involvement over Rewards for Retention Likelihood in IT Professionals

Authors: Humayun Rashid, Lin Zhao

Abstract:

Retention in the IT profession is critical for organizations to stay competitive and operate reliably in the dynamic business environment. Most organizations rely on compensation and rewards as primary tools to enhance retention of employees. In this quantitative survey-based study conducted at a large global bank, we analyze the perceptions of 575 information technology (IT) software professionals in India and Malaysia and find that fairness of rewards has very little impact on retention likelihood. It is far more important to actively involve employees in organizational activities. In addition, our findings indicate that involvement is far more important than information flow: the typical organizational communication to keep employees informed.

Keywords: fairness of rewards, information flow, informationinvolvement, retention

Digital Object Identifier (DOI): doi.org/10.5281/zenodo.1332864

References:

[1] J. C. Brancheau, B. D. Janz, and J. C. Wetherbe, "Key issues in information systems management: 1994-95 Sim Delphi results," MIS Quarterly, vol. 20, no. 2, pp. 225-242, 1996.
[2] D. Joseph, K. Ng, C. Soh, and S. Ang, "Turnover of Information Technology Professionals: A Narrative Review, Meta-Analytic Structural Equation Modeling, and Model Development," MIS Quarterly, vol. 31, no. 3, pp. 547-577, 2007.
[3] N. Khatri, C. T. Fern, and P. Budhwar, "Explaining employee turnover in an Asian context," Human Resource Management J., vol. 11, no. 1, pp. 54-74, 2006.
[4] S. R. Glaser, S. Zamamou, and K. Hacker, "Measuring and interpreting organizational culture," Management Communication Quarterly, vol. 1, pp. 173-198, 1987.
[5] B. Becker and B. Gerhart, "The Impact of Human Resource Management on Organizational Performance: Progress and Prospects," Academy of Management J., vol. 39, pp. 779-801, 1996.
[6] P. M. Wright and W. Boswell, "Desegregating HRM: A Review and Synthesis of Micro and Macro Human Resource Management Research," J. of Management, vol. 28, no. 3, pp. 247-276 , 2002.
[7] K. J. Sigler, "Challenges of employee retention," Management Research News, vol. 22, no. 10, pp. 1 - 5, 1999.
[8] R. Forrester, "Empowerment: Rejuvenating a potent idea, " Academy of Management Executive, vol. 14, no. 3, pp. 67-80, 2000.
[9] T. R. Mitchell, B. C. Holtom, T. W. Lee, C. J. Sablynski, and M. Erez, "Why people stay: Using job embeddedness to predict voluntary turnover, " Academy of Management J., vol. 44, pp. 1102-1121, 2001.
[10] M. Igbaria and S. R. Siegel, "The reasons for turnover of information systems personnel," Information and Management, vol. 23, pp. 321-330, 1992.
[11] J. E. Sheridan, "Organizational Culture and Employee Retention," Academy of Management J., vol. 35, no. 5, pp. 1036-1056, 1992.
[12] J. E. Moore, "One Road to Turnover: An Examination of Work Exhaustion in Technology Professionals," MIS Quarterly, vol. 24, no. 1, 141-168, 2000.
[13] G. Paré, M. Tremblay, and P. Lalonde, "The impact of human resources practices on IT personnel commitment, citizenship behaviors, and turnover intentions (Published Conference Proceedings style)," in Proc. 21st International Conf. Information Systems, Brisbane, Queensland, Australia, 2000, pp. 461-466.
[14] O. Hargie, "Auditing communication practices to improve the management of human resources: A regional study," Health Services Management Research, vol. 9, pp. 209-222, 1996.
[15] O. Hargie and D. Tourish, "Auditing internal communication to build business success," Internal Communication Focus, vol. 22, no. 6, pp. 10- 14, 1996.
[16] B. Tourish, "Evaluating internal communications in local authority leisure facilities: A case study from a leisure complex," Managing Leisure, vol. 2, no. 3, pp. 155-173, 1997.
[17] P. P. G. Clampitt, "Employee perceptions of the relationship between communication and productivity: A field study," J. of Business Communication, vol. 30, no. 1, pp. 5-28, 1993.
[18] R. Snyder and J. Morris, "Organizational communication and performance," J. of Applied Psychology, vol. 69, no. 3, pp. 461-465, 1984.
[19] M. W. Allen, "Communication concepts related to perceived organizational support," Western J. of Communication, vol. 59, pp. 326- 346, 1995.
[20] J. E. Mathieu and S. R. Taylor, "Clarifying conditions and decision points for mediational type inferences in organizational behavior," J. of Organizational Behavior, vol. 27, no. 8, pp. 1031-1056, 2006.
[21] P. K. Blum and V. Q. Tremarco, High Potential PR Professionals Thrive on Challenge: A Study of Employee Turnover and Retention in the Public Relations Industry, International Communications Consultancy Organisation and Institute for Public Relations, Gainesville, FL, 2008.
[22] D. G. Spencer, "Employee Voice and Employee Retention," The Academy of Management J., vol. 29, no. 3, pp. 488-502, 1986.
[23] B. P. Niehoff and R. H. Moorman, "Justice as a Mediator of the Relationship between Methods of Monitoring and Organizational Citizenship Behavior," The Academy of Management J., vol. 36, no. 3, pp. 527-556, 1993.
[24] P. M. Wright and W. R. Boswell, "Desegregating HRM: A Review and Synthesis of Micro and Macro Human Resource Management Research," J. of Management, vol. 28, no. 3, pp. 247-276, 2002.
[25] R. J. Vandenberg, H. A. Richardson, and L. J. Eastman, "The Impact of High Involvement Work Processes on Organizational Effectiveness: A Second-Order Latent Variable Approach," Group & Organization Management, vol. 24, no. 3, pp. 300-339, 1999.
[26] B. P. Niehoff and R. H. Moorman, "Exploring the relationships between top management behaviors and employee perceptions of fairness," International J. of Public Administration, vol. 19, pp. 941-961, 1996.
[27] B. L. Mak and H. Sockel, "A confirmatory factor analysis of IS employee motivation and retention," Information & Management, vol. 38, pp. 265-276, 2001.
[28] J. B. Thatcher, L. P. Stepina, and R. J. Boyle, "Turnover of information technology workers: Examining empirically the influence of attitudes, job characteristics, and external markets," J. of Management Information Systems, vol. 19, no. 3, pp. 231-261, 2002.
[29] K. Kotzé and G. Roodt, "Factors that Affect the Retention of Managerial and Specialist Staff: An Exploratory Study of an Employee Commitment Model," J. of Human Resource Management, vol. 3, no. 2, pp. 48-55, 2005.
[30] E. A. Ward, "Relation of job satisfaction and job knowledge and their effect on intention to turnover," Psychological Reports, vol. 63, no. 2, pp. 611-615, 1988.
[31] L. E. Blankertz and S. E. Robinson, "Who is psychosocial rehabilitation worker?" Psychiatric Rehabilitation J., vol. 19, no. 4, pp. 3-13, 1996.
[32] A. Hytter, " Retention Strategies in France and Sweden," Irish J. of Management, vol. 28, no. 1, pp. 59-79, 2007.
[33] P. Boxall, K. Macky, and Rasmussen, E. "Labour turnover and retention in New Zealand: The causes and consequences of leaving and staying with employers," Asia Pacific J.of Human Resources, vol. 41, no. 2, pp. 195-214, 2003.
[34] C. Fornell and D. F. Larcker, "Evaluating Structural Equation Models with Unoberservable Variables and Measurement Error," J. of Marketing Research, vol. 18, pp. 39-50, 1981.
[35] P. E. Shrout and N. Bolger, "Mediation in Experimental and Nonexperimental Studies: New Procedures and Recommendations," Psychological Method, vol. 7, no. 4, pp. 422-445, 2002.
[36] J. P. Guthrie, "High-involvement work practices, turnover, and productivity: Evidence from New Zealand," The Academy of Management J., vol. 44, no. 1, pp. 180-190, 2001.
[37] T. R. Mitchell, B. C. Holtom, T. W. Lee, and T. Graske, "How to keep your best employees: Developing an effective retention policy," The Academy of Management Executive, Vol. 15, No. 4, pp. 96-109, 2001.
[38] M. Hannay and M. Northam, "Low-Cost Strategies for Employee Retention," Compensation & Benefits Review, vol. 32, no. 4, pp. 65-72, 2000.
[39] P. P. Brooke Jr., D.W. Russell, and J. L. Price "Discriminant validation of measures of job satisfaction, job involvement and organizational commitment," J. of Applied Psychology, vol. 73, no. 2, pp. 139-145, 1988.
[40] J. J. Baroudi, "The Impact of Role Variables on IS Personnel Work Attitudes and Intentions," MIS Quarterly, vol. 9, no. 4, pp. 341-356, 1985.
[41] R. M. Steers, "Antecedents and Outcomes of Organizational Commitment," Administrative Science Quarterly, vol. 22, no. 1, pp. 46- 56, 1977.