Introduction:
It is important for organisations to employ methods which help in the retention of their employees to not suffer from high turnover rates (Russo, 2000). Employee retention is an issue which has long been the focus of companies, and it has attracted a lot of attention from the academic world as well (Saridakis and Cooper, 2016). The retail sector is known to witness a high turnover rate as the nature of employment usually does not allow high wages, and there are no future opportunities as well. It is considered mainly as a non-career job with small or no career development opportunities and a tough work routine. However, this is also the sector which provides jobs to the students, and part-time workers who could not fit in at any other place (McNulty, 2018). Industry provides the opportunity of experiencing responsibility without needing prior experience.
Analysts believe that the retail segment is starting to shed the plague of negative perception; however, it is still an effort to build a positive employment image for the employees (Walsh, 2015). Companies in the retail segment have started putting in the effort as well as an investment in the training and career building of their employees to retain them longer. This calls for the problem of deploying the perfect retention strategies that the company could use to retain its talented employees longer. Companies have their retention strategies as dependent on the nature of their industry and work. However, there is a general understanding of some basic steps which are required for an effective retention strategy. This project is aimed at investigating the retention strategies of Tesco Plc. Tesco Plc is one of the largest supermarket chains in the UK with over 3400 stores (Reuters, 2019). It would be ideal for finding out how a retail giant like Tesco has the resources to implement effective retention strategies to cope with the negative perception of employment in the retail sector, and how it has been successful in it. For this purpose, this report is focused on finding the retention strategy of Tesco Plc.
Academic Rationale:
For any organisation, the main objectives are productivity, high standards, and work performance through the efficient use of its human resource and technological skills. The employees can work to their full potential if the employees are placed in the right position as per their skills and expertise. A talented employee does not run out of alternatives. Therefore, it is needed for an organisation to work on retaining their employees longer to reduce the costs of hiring new employees and training them more often. The retail industry is faced with the challenges of high turnovers because of the nature of the job. Tesco Plc is one such company which has to be investigated to evaluate the reasons for its high turnover. For this reason, it is important to evaluate its retention strategies and to provide better recommendations.
Research Question:
- What is the retention policy for employees of Tesco Plc?
- What is the weakness in the current retention strategy of Tesco Plc?
- How can Tesco Plc improve its retention policy?
Research Objectives
- To review the existing literature on the retention strategies employed by companies
- To identify how Tesco has been implementing its retention strategy for employees over the last five years
- To investigate the eight functions of the retention strategy of Tesco Plc (Training, Mentoring, Compensation & Benefits, Growth Opportunities, Employee Satisfaction, Work/Life Balance/ Work Stress)
- To investigate any potential weaknesses in the Tesco retention strategy
- To propose recommendations for improvement to Tesco Plc for its retention strategy in future
Literature Review:
As per CIPD (2014), the Employee Turnover is defined as the “ratio of the workers who depatime, usually over a specific phase of tidenotedlly computed every year and is donated as a percentage of the sum of the employed workforce at the given organisation”. Employee Retention, on the other hand, is defined as the ability of an organisation to keep hold of its workers for a given timeframe. This is also expressed as a percentage of the total employed workers for a given period (Carsen, 2005). Furthermore, a stability index is also used to measure the employee retention rate.
Studies have shown that the reasons why employees consider leaving their companies usually fall into four categories; push factors, pull factors, organisational influence and the unavoidable factors (Taylor, 2002). The pull factor refers to the employees enticed to an alternative job offer. Push Factors are generally because of what happens at the company or because of how the employee perceives the company or the employer. The reason is usually to find better working conditions. The unavoidable turnover is usually because of the reason, which are not under the control of the employer, including illness, retirement, moving at another location, etc. The organisational influence or the involuntary turnover is due to the actions of the organisation which means the company fired an employee or laid them off (Ahuja et al., 2018).
The high employee turnover in itself is a bad reputation thing for any company. However, there are numerous other problems as well, which comes with a high turnover of the employees. The turnover is linked to high replacement costs, loss of knowledge and skills, lower morale and high work stress on the remaining staff. This is the very reason that companies usually work hard to retain their employees. There are several ways in which a company can help build a culture in which employees would love to stay working. However, for the devising of an effective retention strategy, it is imperative to know why employees leave the organisation. Employers thus need to be more acknowledging of the employee problems and help them fall valued and engaged to retain them (Coetzee, Potgieter and Ferreira, 2018).
As per SPHR, 88% of the employees leave their jobs for reasons other than their pay. On the contrary, 70% of the managers link the employees leaving with their pay issues (Branham, 2012). Organisations usually face the dilemma of whether to invest in the fine-tuning of their recruitment strategy or to invest more in retaining their existing workforce. However, it is evident that once an organisation has skilled staff, it pays to make sure that they stay. There are some important strategies which need to be considered in the retention of the employees. These include.
Training:
Training is one of the methods through which the employees are provided with a sense of value. Through training programs, employers can aid the employees in achieving their goals and ensuring that they have a solid understanding of their job role(Raj and Brindha, 2013). As per the research conducted in 2011, the six common strategies that help in the enhancement of employee retention include training (Aruchanalam, Geetha and Kavitha, 2011).
Mentoring:
The mentoring of the employees through a mentoring program integrated with goal-oriented feedback system gives the structural mechanism for the development of better relationships between the employees and management and a strong basis for the retention and growth of the employees. With the use of the mentoring plan, the business couple an experienced individual with an individual who is less skilled in a field which is alike in both. This is done for the goal of development of specific competencies of the employees and providing performance feedback, designing of a specific career development plan (Raj and Brindha, 2013).
Compensation & Benefits:
It is necessary for the management to offer things like competitive salaries, programs for a bonus, sharing of profit, plans for pension, paid vacancies, and tuition reimbursements. These steps propel a powerful point to the workers on their significance and value to the business. The compensation and benefits provided to the workers have to be significant if the management wants it to effectively impact on the employees in terms of their perception of the organisation and consequently influencing their retention. Furthermore, it is also vital that an organisation should also keep the promises for the rewards that it makes to its employees (Raj and Brindha, 2013). The research conducted in 2016 showed that the company should work on taking care of its workers as a precious asset of the business and for this, it should plan the model for the rewards and retention of the company. It also showed that the company should reward the employees who perform better than expected for retaining them (Stillo and Furxhi,).
Growth Opportunities:
An organisation should also work on providing the employees with workshops, training for software, or other tools which would help them to increase their understanding of their skills and their careers ahead. This will help them in their goal setting and future endeavours. The employees like to be challenged in their roles. A boring routine job does not motivate an employee and often leads them to look for better challenging jobs elsewhere. This is the reason it is important for the employers to provide their employees with adequate job challenges that help them in the expansion of their knowledge. This will help them get engaged in their jobs and stay committed to making them retain longer at the workplace (Raj and Brindha, 2013). It has been found that 85% of the employees consider career growth opportunities as a vital reward while only 49% of the companies are providing it(Branham, 2005).
Employee Satisfaction:
As the authors have mentioned in the study conducted in 2011 that the six common strategies for employee retention include the job satisfaction of the employees along with other factors (Aruchanalam, Geetha and Kavitha, ). The steps towards the enhancement of employee retention start with the recruitment stage and then build on to the improvement of the job satisfaction level. If management succeeds in the assurance of employee satisfaction, then it also helps in the assurance of the devotion towards the job and the company consequently helping in retaining them longer (Yurtseven, 2012).
Work/Life Balance/ Work Stress
It has been evident that a content worker has a winning mix of corporate and personal life. For this, the management needs to know the environment in which the employees operate in finding out if the psychological wellbeing is also secured along with the physical wellbeing (Stillo and Furxhi, 2016). For the retention of experienced and knowledgeable employees, management needs the work-life balance of employees to be perfect. Furthermore, it is important that the work-life balance is as per the needs of the employees. This can be done by offering compressed work week, flextime, telecommuting and extra holidays (Raj and Brindha, 2013). Other than this, the company should also work on lowering the stress of the workers from overwork and deadline pressures. Furthermore, the employees should be provided with worthy rewards for their extra efforts and the sacrifice of their work-life balance, if it is required at some point. However, such work routines should be discouraged.
Tesco Plc:
Tesco Plc, with over 240,000 employees all over the world and the largest private sector employer with more than 2365 stores, is one of the largest grocery stores in the UK. The grocery store ranges far beyond the food items. It also offers banking, flower delivery, legal, online dietary, DVD rental and telecom services. The company operates in 13 countries and is the market leader in more than six of these countries. The company usually takes up 80 to 150 graduates in its training schemes each year for its office-based and store-based roles. The company prides itself in lower turnover rates as compared to the market as it offers flexible working options, job shares, career breaks, and shift swaps to its employees. The company also offers shared ownership, and pension plans to its employees (Paton, 2005).
Research Methodology:
The research onion model as proposed by Lewis, Saunder (2011) will be used for proposing the research methodology. The project will be based on positivism research philosophy. As per Bell and Bryman (2007), positivism is the epistemological position which helps in the appliance of the technique of natural sciences to the learning of the social reality.
Research Approach:
Any research approach uses a model of research onion to provide a choice of deductive and inductive approach. The author Saunders has shown that the deductive approach needs the development of theory for the rigorous test to verify it. On the contrary, the inductive approach is the opposite. The inductive research approach involves the process where a specific phenomenon is observed, and on its basis, a general conclusion is formed. For this research, the study will make use of the deductive approach (Saunders, 2011).
Research Strategy:
The onion model shows that the author is provided with several research strategies. These include experimentation, case study, survey, action research, ethnography, archival research, grounded theory, and action research. For this study, the research will employ case study research techniques. The case study method is appropriate for this as it is the plan for implementing the research which also includes the empirical examination of the definite contemporary event in reality context by utilising the multiple foundations of evidence. The research method of qualitative research will be used in which the analysis of the secondary data will be conducted (Robson, 2002).
Research Choices:
As per the onion layers of research model, the author is given with multiple methodology, technique or the mono-method technique. The data collection technique in this regard is deferred. The mono-method involves only qualitative or quantitative data sources for the collection of the data. However, the multi-method approach involves using both methods for the compilation of the data. For this study, the study is going to use the mono method approach for the collection of the data. The mono-method approach will be used for the employment of the qualitative data only. The research will use the case study of Tesco Plc and gather all relevant publicly available data on its retention strategy to evaluate it. The study will use secondary data sources for analysing the retention strategy of Tesco Plc and compare it with the accepted and practised effective retention strategies used by companies all over the world.
Timeline:
The total timeline for this study is targeted to be completed within 8 weeks at maximum. Chapter 1, Introduction is going to be completed within the 1st week of the project. The literature review will be conducted and completed in week 2 and 3. The Methodology chapter will be completed by week 4. The discussion and findings will be done by week 6. The Conclusion & Recommendations chapter will be completed by Week 7. Week 8 will be dedicated to proofreading of the complete project and final editing. All in all, the project will take 8 weeks to complete.
References
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