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An Empirical Study of Employee Turnover

Abstract of Mercer Award Winning PhD Thesis | By Dr. Nandkishore Rathi

India is an important player on the IT (Information Technology) map of the world. The unique characteristics of this industry pose many HR (Human Resource) challenges to the managers of this industry. A field study reveals that 'retention and motivation of software professionals' tops the list of top ten HR challenges being faced by this industry.

The study attempts to investigate the issue of employee turnover in Indian software industry through a person-organisation fit (P-O fit) based turnover model, and attempts to fill a gap in HR literature as no systematic study has been conducted in the recent past on firms developing software for other user organisations. Although, the IT industry at present is reeling under slowdown, the data collected pertains to an emerging-industry context, and the findings may be viewed accordingly.

Rather than looking at the turnover phenomenon directly, it is analysed through overall satisfaction (OS) as it gives more insight into various organisational factors like HR policies, job factors etc. and help draw conclusions with far more implications. The main antecedent of turnover behaviour is, therefore, OS, which is a consequence of a combined effect of person-culture (P-C) fit, person-job (P-J) fit, career satisfaction (CS), met expectations (ME), perceived ease of internal movement (PEM-I), and perceived ease of external movement (PEM-X). The study was undertaken in 14 software firms in which 1028 people participated. Qualitative analysis, in addition to the quantitative analysis, helped in an in-depth understanding of turnover phenomenon.

The model developed for the study is validated, establishing the relevance of all the above variables to software industry. Contrary to the hypothesis, the high availability of jobs in labour market does not affect the OS, but its component the extrinsic satisfaction (ES) does. Size, maturity of the organisation, and software segment to which the software professionals belong emerge as important organisational variables that affect turnover phenomenon.