The Effects Of Employer Branding On Employee Turnover Targets

Objectives

The chosen topic of research intends to critically establish the contribution of employer branding in the management of employee turnover capabilities. As such, the study targets to show how employee turn-over can increase because of employer branding. As an internal marketing concept, employer branding is a recent development as organisations, particularly multinational corporations, have lately learnt that their employees are their immediate market while promoting their company (Martin et al., 2011). As such, in Saudi Arabia and similarly in other parts of the world, with the rising competitive labour markets, retaining and attracting talented staff has become a major concern for most organisations (Wallace et al., 2014). Just as organisational brands reveal the benefits of a particular product to prospective consumers, employer brands depict the value of employment to prospective human resource. Therefore, as an internal advertisement, employer branding has been regarded as organisations’ efforts to convince both potential and existing employers that the organisation is indeed a great place to work at (Botha, 2012).

On the other hand, Huang et al. (2012) argue that organisational commitment defines employee attitudes and withdrawal behaviours. Employee attitudes include organisation identification and job satisfaction while withdrawal behaviours include decreased organisational performance, burnout and absenteeism. As aforementioned, attracting and retaining staff with the required knowledge and skills is a source of a company’s corporate strategic advantage (Wallace et al., 2014). As such, organisational commitment in general has received considerable attention from Western countries’ researchers over the past decades. However, the potential of constituent aspects of organisational commitment, particularly employer branding, have not been tapped in Saudi Arabia as they have received little attention in Non-western countries. Consequently, Similar to other parts of the world, many transnational companies in Saudi Arabia are experiencing challenges when it comes to retaining skilled manpower due to scramble for top talent (Froese and Xiao, 2012). Therefore, this research seeks to bridge the gap by examining how employer branding serves to manage voluntary employee turnover targets in the Panda Retail Company. The research will focus on how an organisation’s developmental, social and economic values shape an employee’s turn over intentions for the growth of business.

This research aims to generally investigate the effects of employer branding on employee turn-over targets in the Saudi Arabia while drawing reference from Panda Retail Company.

To attain this the research seeks to satisfy these objectives;

1. To explore how strategic development value influences employee turnover targets
2. To understand how social value impact on employees turnover
3. To establish how economic value influence employees turnover targets

1. What are the effects of employer branding on employee turnover?
2. How do strategic development value influences employee turnover targets at Panda Retail Company?
3. How do social value impact on employees’ turnover at Panda Retail Company?
4. How do economic value influence employees’ turnover targets at Panda Retail Company?  

While using Panda Retail Company in Saudi Arabia as a case study company, this research examined the effects of employer branding on employee turnover intentions in Panda Retail Company. Through collection and analysis of qualitative data, the research showed how employee’s personal development quest determines their organisational commitment as well as their turnover intentions. The researcher also shed light on the impact of social and economic values on individual commitment

The study majorly focused on effects of employer branding on employee turn-over targets. Since branding is a strategic move by the management to improve its development goals, it took a lot of time crafting parameters of measuring effects of branding. The research was giving the general feel and effects that branding can help a sector thrive. As such, a biased focus was necessary to achieve the objectives of the research.

Literature Review

Over the past, many companies have been losing their employees because of poor relationship between management and employees. Many scholars have also criticized working conditions as a major contributor to resignation of skilled employees. Other companies have been poaching employees from other companies by offering good packages. Therefore, the study had a goal of enlightening employers on the importance of branding their company so that they can easy achieve their strategic goal without facing sabotage from their employees.

This section reviews articles, theories and current research on direct impact of employer branding on employee turnover targets. Besides, the section reviews relevant articles and trending research on aspects related to employer branding. It also revisits peer reviewed articles on prime aspects that define employees’ turnover targets. To attain this, the research focuses on literatures that categorise development, economic and social values as possible factors influencing staff turnover targets.

Employee turnover targets is a precursor to the actual turnover (Jordan and Troth, 2011). As such, according Chen et al. (2011), it refers to a worker’s mental decision to look for a new employer in another job. Normally, it is categorised into two: voluntary and involuntary turnover intention. Voluntary regards employee’s individual intent to quit working in an organisation (Wells et al., 2011). Therefore, voluntary employee turnover intentions is inversely proportional to job satisfaction as it reflects lack of organisation commitment on the employee mind (Kim, 2012). Employees who are satisfied with their job anchors low turnover intention. Thus, employers need to realise developmental, social and economic factors that influence career decision in their workers (Chen et al., 2011). On the other hand, involuntary employee turnover intention regards an employer’s plan to fire an employee or employees on the basis of excessive manpower or unreliability (Kim, 2012).

Employer branding refers to a package of economic, social and developmental benefits granted to employees and which the employing company identifies with (Kryger et al., 2011). Intrinsically, they are economic and psychological packages that appeal to employees with the aim of attracting their commitment to the organisation as the employer of choice (Martin et al., 2011). According to Sivertzen et al. (2013) as a functional package, employer branding is an internal marketing tool that consists of strategies that improves not only its immediate employee’s perception but also that of potential employees.

As an internal marketing tool, employer branding is aimed at portraying employer attractiveness, which in turn signify an organisations attractiveness to prospective employees (Wallace et al., 2014). Additional value on products signify high brands and hence attract more customers. Likewise, to attract more employees, organisations must envision benefits that appeal to prospective employees while working for the organisation (Kim, 2012). Experienced applicants distrust employer branding. Instead, they value a company’s contribution in their career development such as career enhancement and professional development programs (Mowday et al., 2013). Therefore, they will seem less interested with the company’s appearance than what they stand to gain career-wise. In this case, employer branding will therefore attract less experienced applicants who seek a strong corporate brand contribution in their CV (Huang et al. 2011).Workers are vital assets for every organisation since they determine its success and strategic development. Consequently, quitting is therefore an indication that the company is in trouble (Hom et al., 2012). Moreover, employees whose organisation is concerned with their career growth are bound to stick in the organisation (Wang et.al, 2014). Therefore, this means that career development has direct implication on turnover intentions (Weng and McElroy, 2012).

Employee Turnover Targets

According to Valentine et al. (2011), the aspect of social values insinuates the theory of social identity and social exchange relationship between supervisors and their immediate employees. Malakyan (2014) argues that when employees’ needs, aspirations and development is a concern to a leader, employees will respond to this by bestowing a higher level of trust on their leader. This is forecasted by employees trust on their leaders. In fact, Panaccio and Vandenberghe (2011) conclude that employees self-esteem inspired by an organisation particularly the employers presents a negative impact on employee turnover intentions.    

According to Froese and Xiao (2012), employee commitment has been viewed as a product of costs and rewards linked to an organisations membership. Meyer et al. (2012) argued that with respect to continuance component from their three-component model, which consist of continuance, normative and effective commitment, employee commitment is motivated by the knowledge of the cost arising from leaving an organisation. Traditionally, Money is considered as not only the measure of worth but also an instrument of commerce. Therefore, the economic value of work is contained in payment, which is reflected in monetary value (Froese and Xiao, 2012). With such importance, money has served to attract, maintain and encourage employees in order to realize organisational strategic goals (Tang and Sutarso, 2013). In line with this, Tang et al.( 2011) maintain that money has served to direct organisational behaviour as well as several outcomes for instance, pay satisfaction. However, some theorists contend that money cannot sustain job satisfaction for long. In fact, according toDerby-Davis. (2014), money cannot provide positive satisfaction towards the job, instead it greatly contributes dissatisfaction particularly in its absence.

Current organisations need to constitute a working environment that pledge opportunities for career growth to influence employee turnover. This is because organisational career development harbours potential solution that can manage turnover. Moreover, the social identity of leaders defines the employer brand perception. Consequently, employees are likely to honour and identify with a company’s brand if the immediate employer’s brand portrays a positive image. Employees are likely to seek membership or employment in companies that cultivate their self-esteem. Finally, with respect to economic value, organisation commitment is always at stake. Consequently, with the high quest for skilled employees, workers whose concern is primarily money will habitually switch to organisations offering high salaries leading to high turnover.

This research adopted qualitative methods. This is ideally because, to address the objectives regarding the impact of branding on strategic development, social and economic value on employee turnover intentions, the researcher targeted to collect employee’s responses and opinions. Therefore, with this research, qualitative primary data was considered the most appropriate one. This is because it is primarily an explanatory exercise (Yin, 2015). When collecting their opinions or responses, interview method was considerably the most suitable data collecting tool.

With respect to sourcing information, data was obtained from 36 questionnaires. Data was collected from 6 managers and 30 employees. This number of participants was suitable as questions consumes a lot of time and resources and therefore is suitable for few participants. The 30 employees comprised of those with maximum working experience, moderate and the newly employed staff. The newly employed verified whether Panda Retail Company is a great place to work at with respect to employer branding. The purpose of using the employees as respondents to examine the impact of employer branding on turnover intentions is due to the fact that, this research intended to show employees satisfaction as reflected by their commitment to work in a great environment. As such, their response served to address the research objectives.

Employer Branding

From the two groups, management and employees, respondents were selected based on convenience sampling technique. This is a sampling technique where participants are chosen out of their convenient proximity and accessibility to the researcher (Leary, 2011). This sampling method served to minimise time wastage. Also, notably, this method enabled the researcher to selectively pick the desired research participants depending on the two groups (Zikmund et al., 2013).

In line with Sekaran and Bougie (2016), a sample size of between thirty and five hundred qualify to represent a population in a research study. Therefore, this strategic research study included 36 staffs from Panda Retail Company. In particular, The 30 respondents comprised of an evenly distributed sample of employees, comprising of those with maximum working experience, moderate and the newly employed staff. While the remaining 6 came from the management, human resource, marketing, public relations, and other departmental managers.

When carrying out this research, the researcher adhered to some fundamental ethical practices. First, voluntary participation was adhered to whereby participation in the data collection process were not forced to participate. They were free to participate or to opt out of the process whenever they feel like. Therefore, no one was coerced to participate in the research. Secondly, Confidentiality of the respondent’s personal details were guaranteed to prevent disclosure of any sensitive personal information.

Research validity applies when the researcher apply their methods to stick to the objectives of the research (Drost 2011). More often, researchers have the tendency of deviating from the real course of the research. In a complex study like this, this can be a challenge but adequate measures were put in place to stay on course by just looking into the effects of employer branding on employee turnover.

Drost (2011) asserts that the ability to reproduce a research measures its reliability. Moreover, this research took into consideration all the parameters of a research proposal, paying close attention to ethics and using reliable sources in its development. As such, this research contributes to other academic sources, which can be used to further other studies.

The purpose of this research is to establish how strategic employer branding affects employee turnover intentions in Panda Retail Company. The study intends to show how employer branding can enhance organisational strategic development thereby increasing employee turnover. Therefore, this company will provide a good reference case in the understanding of influence of employer branding on employee turnover intentions. 

Content analysis method was applied in data analysis for this study. The method involves assigning values, gathering and deducing vital meaning about the study phenomenon from the collected data (Grbich, 2012). Through content analysis, the researcher decoded the interviewees’ answers while identifying similar or varied themes from the interviewee’s responses. While analysing the emerging themes and concepts, the findings were compared with the findings of previous studies as outlined in the literature section of this dissertation. This enabled the researcher to   have concrete findings and draw conclusions on the impact of employer branding on employee turnover intentions in Panda Retail Company.

The data collected shows that both managers and employees believe that employer’s branding is necessary to help increase the turnover of employees. From their reasoning, branding the company motivates the staffs who becomes happy with their working environment.

Over three-quarters of the respondents agreed that strategic development value often affect general turnover in the company. Strategic development moves like branding influences the overall turnover of the company. In particular, they pointed out involvement in strategic development plans as a motivation towards increasing their individual goals. Incorporating employees in branding the company by involving them in marketing is a sure way of connecting to the company. When employees feel as part of the brand, they will work tirelessly to maintain it and grow it further.

Majority of the employees confirmed that good economic packages have direct effect on their individual output. However, some refuted, they claimed that some employees are just lazy or some are in management position who had good packages but delivered little to the company. Branding the company in terms of employees’ benefits, insurance schemes, paid leave are some of the factors that motivate employees to work harder in the company thus increasing their individual output.

Social value packages charity works, community voluntarism and corporate social responsibility have an influence on employees’ satisfaction. At 59% satisfaction rate, this means that over a half of the employees feel comfortable working with the company. This rate can increase when strategic branding on improving employees’ welfare is considered.

Employee branding by employers play a vital role in increasing individual output of every staff. Strategic development call for making strategic decision aimed at increasing turnover and general output of the company. Employee retention rate, skills development, and overall turnover often rely on the already established brand.

According to Bab?anová, Bab?an and Odlerova (2010), achieving employer branding goals should incorporate clearly defined employer brand strategy. Therefore, Saudi Arabia companies should take branding as a strategic measure to increase their turnovers. Moreover, education and awareness program for the new brand can help keep the current customers and even win several others.

Furthermore, offering good compensation packages from the human resource department is a source of motivation to employees, which in turn help to improve their individual output. Besides, organisational leadership brand, usage of social media, job advertisements, and performance management practices often help in attracting new skilled talents to the company. New skilled talents usually bring new energy and expertise necessary to drive the overall output of the company.

Conclusion

Overall, increasing the output of a company requires strategic development decisions such as branding. Branding of the company will help maintain skilled talents, attract more talents and provide a favourable working environment for employees to give their best. As such, improving the brand of the company will benefit the company in the long run.

I recommend companies to work on improving their brand. Undertaking strategic decisions on brand development is key to surviving in the current competitive business world. Embracing social media, community empowerment, good employee package and corporate social responsibility is the key to business sustainability.

The current research is focusing on an individual company, comparative employer brand practices in other sectors is necessary to improve business performance in Saudi Arabia. A model on “employer branding” management practices needs to be established which would help organizations attract and retain best talents with minimum cost and effort. 

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