Quantitative analysis on employee retention factors in medium and large scale IT organizations in Sri Lanka

Abstract

IT industry is growing faster than ever. Furthermore, the IT industry is becoming more and more competitive. IT organizations are constantly looking to prospect and maintain employees with top quality. Unlike in any other industry, IT industry rely more on the knowledgeable employees. The impact of employee turnover on an organization is costly. Main reason for that is the cost ofreplacing the knowledge and experience ofthe employee. The main objective of this study is to find out the factors, which leads Sri Lankan IT professionals to stay in their current organization. This study is extended to identify the effect on moderator variables on the relationship between the employee retention factors and the employee’s intention to stay. Quantitative research was carried out among 174 IT professionals in Sri Lankan large and medium scale IT organizations, whose designation is below the managerial position. Analysis confirmed that job security, organization culture, flexible working hours, involvement in decision making, supervisory support and compensation have positive relationship with employee retention. Furthermore, the analysis results showed that the moderator factors (age, gender and marital status) have an effect on the relationship between the job security, training and development, flexible working hours, supervisory support, performance appraisals and employee retention. As per the findings of this study, HR managers should consider more on giving their employees flexible working hours, providing fair and understandable employee performance appraisals process. Even though this study did not resulted in direct relationship between the career development and employee’s intention stay, the managers should provide the facilities to employee’s career development. Managers should give a massive consideration for the employee’s remuneration. In Sri Lankan context, with identifying above results, HR managers can do an analysis on a particular employee and identify the probability of that employee leaving the organization or retaining. That will be a key model for the HR managers to analyse the employees and come up with strategic plans to retain talented employees within the organization.