Full Project – Employee turnover and organizational health in the private sector

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Chapter One

INTRODUCTION

1.1 Background of the Study

Employee turnover refers to the rate at which an employer gains and losses employee, how long the staff tend to leave and join the organization (Armstrong, 2006). According to Phillip (2009) employees turnover influences allocation of the job tasks functions to inexperienced employees who lacks technical knowhow on effective execution of organization services, this greatly degrades the quality of organization services and as result, low level of customer satisfaction is realized. According to Martin (2005) when employees leave the organization, the employer has to incur a considerable amount of direct and indirect expense.

The costs of employee turnover can be staggering ranging from consuming quite a substantial amount of annual wage that an employer would otherwise pay to its workforce (Linda, 2002). The costs of employees turnover normally includes; advertising expenses, headhunting fees, resource management expenses, loss of time and efficiency, work imbalance, and employee training and development expenses for new joiners (Harrie,2002). The company may quarterly calculate employee turnover rates to meliorate the factors causing the turnover (Miller, 2006). If the company determines the most common causes of employee turnover, it would certainly be able to take the necessary steps for recruiting and retaining well-qualified personnel (Armstrong, 2006)

Job performance can be said to be achieved when such attributes as abilities, competencies, aptitude, creativity, independence, skills, motivation as well as commitment of individuals are combined for efficiency in focus. Other attributes include personal discipline, communication skills and abilities, organizational training and self-development of individuals in the organization. Basahuwa, Unegbu and Yemisi (2020) cited ability to give a qualitative and quantitative task performance, impressive interpersonal relationship, as well as the ability to work with minimal supervision as indicators of job performance.

1.2 Statement of the Problem

Employee turnover can be harmful to organizational performance if skilled workers often leave the organization and the work population contains a high percentage of novice workers (Armstrong, 2009). The performance of many organizations has thus, been threatened by huge costs/expenditure incurred on recruitment and selection of new staff to replace the work force gap created by the leaving employees (Premeaux, 2000). In the recent past, there has been noticeable decline in the performance of many organizations in especially from the private sectors (Ali, 2010). This downward trend according to (Edward, 2010) has been influenced by high level of employee turnover that impacts negatively on organization performance.

According to Maxwell (2010), a key problem to employees’ turnover is that the organization loses the most experienced and skilled staff that the organization had invested heavily in training on various organization job task functions. This therefore means that, the organization must incur huge costs in terms of time and finance to train the newly recruited staff in order to make them effectively adapt to organization working environment and demonstrate the required skills and experience.

Based on the above, the researcher is out to investigate the relationship between employee turnover and organizational performance in the private sector of Rivers state.

1.3 Conceptual Framework

Fig. 1.1

Source: Researcher’s Desk, 2021

1.4 Objectives of the Study

The main objective guiding the study was to investigate the relationship between employee turnover and organizational health in the private sector of Rivers state: Specific objectives are:

1. To determine the relationship between voluntary turnover and goal focus.
2. To examine the relationship between voluntary turnover and resource utilization
3. To ascertain the relationship between involuntary turnover and goal focus
4. To investigate the relationship between involuntary turnover and resource utilization

1.5 Research Questions

1. What is the relationship between voluntary turnover and goal focus?
2. What is the relationship between voluntary turnover and resource utilization?
3. What is the relationship between involuntary turnover and goal focus?
4. What is the relationship between involuntary turnover and resource utilization?

1.6 Research Hypotheses

HO₁: There is no significant relationship between voluntary turnover and goal focus.

HO₂: There is no significant relationship between voluntary turnover and resource utilization.

HO₃: There is no significant relationship between involuntary turnover and goal focus.

HO₄: There is no significant the relationship between involuntary turnover and resource utilization.

1.7 Significance of the Study

This study will beneficial and helpful to the following:

Private Sector: This study will help the private sector’ adopt appropriate compensation schemes for employees’ initiatives to enhance their performance thus increasing commitment.

Researchers: Besides, the study would benefit other researchers in carrying out further empirical research studies on employee compensation. The study would enable researchers to find out how various factors affect employee compensation.

Management student: This research study would also help to highlight other important variables that require further research; this may be focusing of other variables that have effect on the employees commitment.

Government Agencies: the study would help organization in policy formulation aimed at controlling and motivating employees.

1.8 Scope of the Study

The content scope: this study centered on investigating the relationship between employee turnover and organizational health in the private sector of Rivers state.

The geographical scope: this study covered only Dufil Prima Foods PLC in Port Harcourt, Rivers State, The unit of Analysis: the workers are unity of analysis because they are the respondents.

1.9 Limitation of the Study

During this project research, the researcher encountered so 1many challenges like lack of finance, lack of reliable access to information from respondents, limited time and academic stress.

1.10 Operational Definition of Terms

Employee turnover: refers to the process whereby employees leave the organization

Resource utilization: refers to proper usage of limited financial equipment and manpower resources in the most efficient and equitable manner.

Involuntary turnover: this occurs when an employee is terminated from a position.

Voluntary turnover: refers to employee departure when a team member leaves a role or organization on his or her own terms, either for a new position, to relocate to a different city, or for another reason.

Organizational health: refers to an organizations ability to function effectively to cope adequately to change appropriately and to grow from within.

Goal Focus: refers to the assumption that most human factors are purpose and that behaviour is regulated and maintained by goals and intentions.

1.11 Organizational profile of Dufil Prima Foods Plc

The Dufil Prima Foods PLC was incorporated in 2001 as a private limited liability company at Choba, Port Harcourt, Rivers State. Upon completion of a restructuring exercise the company was converted to Public limited company and became the holding company of the group in year 2008.The existence of the Facility arises due to the growing demand for the product from the consumers of the region and the nation.

Dufil Prima Foods Plc comprises six subsidiaries — namely: De united Foods Industries Limited (Nigeria & Ghana), Northern Noodles Limited, Pure Flour Mills Limited, Insignia Print Technology Lftz Enterprise and Raffles Oil Lftz Enterprise. De United Foods Industries Limited, Noodle Division, started its operation in year 1996 at Ota, Ogun State, is the first instant noodles manufacturing plant in Nigeria and the largest in Africa at that time. The company started with staff strength of about 500 but today it has over 1500 staff members working effectively and efficiently toward one common goal; to satisfy its customers by continuously offering a variety of nutritious, healthy and quality products. The objective is to provide fresh and quality product to the consumers. De United Foods is a Corporate Member of the Nigerian Institute Of Food Science And Technology (NIFST). It has it Corporate Office located at DUFIL Prima Foods Plc 38, Eric Moore Road, Surulere, Lagos, Nigeria. With operational base located at 68B, Uniport Road, Choba, Port Harcourt, Obio Akpor, Rivers, Nigeria.

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Full Project – Employee turnover and organizational health in the private sector