Description
1. INTRODUCTION
Organizations of today are identifying the significance of human resources like never before. Many have realized the fact that employees are the assets of
the organization. Right Employees are the real need of any business of the day to reach its objectives and earn the profit. No doubt that employees fall
into the asset side of the balance sheet of every organization. People are the means to earn profit in the organization. Therefore, it is utmost important
that right employees are attracted, developed and retained in the organization. Employee retention is the buzzword in Human Resource Management. An organ-
ization’s ability to retain its employees is closely related to its ability to achieve high performance levels and earn greater business results.
Employee retention refers to the various policies and practices which let the employees stick to an organization for a longer period of time. Every organization
invests time and money to groom a new joinee, make him a corporate ready material and bring him at par with the existing employees. The organization is
completely at loss when the employees leave their job once they are fully trained. That is why it is very important to understand the role of key factors in employee
retention. The present study empirically tests the role of HR Practices and Job Satisfaction in Organization Commitment and its impact on the Employee Retention.
2. LITERATURE REVIEW
2.1 Employee retention
Dahlgaard and Eskildsen (2000) in their study observed that employees who are satisfied with their jobs are more dynamic, resourceful and are likely to be retained
by the company. Elangovan (2001) noted that the concept of job satisfaction and organizational commitment being casually related has not been incorporated in
most turnover model
2.2 HRM Practices and Organization Commitment
Numerous researchers have observed the relationships between HRM practices and organizational commitment. Paul and Anantharaman (2004) observed that
HRM practices and organizational commitment have a positive relationship among the software professionals. Wright and Kehoe (2007) concluded that commit-
ment to goals, to the job, to the supervisor, or to the workgroup might play as significant a role as commitment to the organization. The study suggested that a
broader view of the potential commitments could be impacted by HR practices and that might be related to firm performance. The authors opined that people
make sense of the HR practices they experience, and this will have influence on their commitment
2.3 Job Satisfaction and Organization Commitment
Coetzee, Tladinyane, & Ferreira (2011) found that employees who are satisfied with pay, promotion, supervision, fringe benefits, contingent rewards feel more
emotionally attached to their organizations. The study concluded that there is a positive relationship between job satisfaction and Organization Commit-
ment.Meyer et.al(2002) found the strongest correlation between affective commitment and overall job satisfaction.
2.4 Organization Commitment and Employee Retention
Van Dyk, J., & Coetzee, M. (2012) found that employees satisfaction with retention factors has a significant relationship with their organizational commitment and
that the biographical groups differ significantly in terms of the variables. Employees who are happy with their jobs are improbable to leave compared to employees
who are unhappy. Employees who are unhappy will more than likely leave the organization (Chen et al., 2011; Kim & Jogaratnam, 2010; Yücel, 2012). Affective
commitment involves being happy with one’s job and the desire to remain in the organization.
3. RESEARCH OBJECTIVES
The present research has been undertaken to fulfill the following objectives:
1. To examine the role of HR practices and Job Satisfaction in Organization Commitment
2. To analyze the impact of Organization Commitment towards Employee Retention
4. RESEARCH HYPOTHESES
The objectives of the study are empirically tested and statements of hypothesis for this study are as follows:
H1: HR practices will significantly influence Organizational Commitment
H2: Job Satisfaction will significantly influence Organizational Commitment
H3: Organization Commitment will significantly influence Employee Retention.
5. CONCEPTUAL FRAMEWORK
FIG. 1
6. METHODOLOGY
For the study the target population was identified as employees of IT companies in Bangalore. List of employees provided by the companies was the sampling
frame. Simple random sampling was used for the purpose. The sample size was 180 employees of selected IT companies in Bangalore.
The data was collected using a survey instrument using 1 to 5 Likert scale ranging from Strongly disagree to Strongly agree. Four constructs were used in the study.
They are HR Practices, Job Satisfaction, Organization Commitment and Retention. HR Practices Scale was adapted from Edgar & Geare (2005); Job Satisfaction
Scale was drawn from Minnesota Satisfaction Questionnaire Weiss, Davis, & England (1967). Organisational Commitment scale was adopted from the Organisa-
tional Commitment Questionnaire of Mowday et al (1979). Retention scale was adopted from Mobley, Horner, & Hollingsworth (1978).
Primary data collected for the purpose of analysis have been checked, coded, classified and tabulated by following the statistical procedures. Analysis and inter-
pretation of primary data are based on the tabulated data. The raw data was analyzed using SPSS 20.
7. RESULTS AND DISCUSSIONS
The reliability analysis of the scales Cronbach alpha was found, as it is shown in table 1 it is in the acceptable range of 0.76 to 0.97 (Nunnally, 1978). Thus the scale
found to be reliable.
TABLE NO. 1: CRONBACH’S ALPHA
Item Items scale summated Cronbach’s Alpha
Human Resource Practices 5 .972
Job Satisfaction 4 .973
Organisation Commitment 5 .890
Employee Retention 4 .762
In order to examine the role of HR Practices and Job Satisfaction towards Organization Commitment, ANOVA was performed. In this regard, HR Practices and Job
Satisfaction were considered as dependent variable and Organization Commitment was considered as the factor. The results of ANOVA are displayed in the fol-
lowing table no 2.
TABLE NO. 2: ANOVA
ANOVA Sum of Squares df Mean Square F Sig.
Human Resource practices
Between Groups 150.082 16 9.380 59.847 .000
Within Groups 25.548 163 .157
Total 175.629 179
Job Satisfaction
Between Groups 153.355 16 9.585 66.682 .000
Within Groups 23.429 163 .144
Total 176.784 179
The results revealed that both HR Practices and Job Satisfaction are significant with Organization Commitment. Hence H1 and H2 are accepted.
