1 STAFF TURNOVER ISSUES IN AMAZON Staff turnover is a major matter of concern, to most of the multi-national companies operating in the fast and competitive international business environment. Employee turnover refers to the measurement of the time period, during which employees remains engaged with a company or stick to their roles in that company. The purpose of this study is to throw lights on the issues of employee turnover Amazon, a multinational technology company that has expanded its wings on e-commerce, cloud computing. It also operates in the domain of digital streaming as well as artificial intelligence. Recent studies have revealed that, business experts consider Amazon at the second position in terms of employee turnover, while estimating the staff turnover rate amongMulti National Companies. A brief introduction of the organization: Amazon is a popular multinational company, based in America. The headquarters of the company is in Seattle, which is situated in Washington. Since its inception in the year 1994 by Jeffrey P. Bezos., as a marketplace for the books over internet, the company has spread its wings over e-commerce, cloud-computing as well as digital streaming along with artificial intelligence. Amazon is one of those multinational companies that are well known for adopting technological innovation for the purpose of expanding its business. Along with this, Amazon is world’s largest marketplace for e-commerce. As estimated in terms of revenue and market capitalization, Amazon is one of the biggest AI assistant providers as well as a plat for cloud computing. Amazon is considered to be the biggest revenue earning e-commerce company. In the year 2015, the market capitalization s well as revenue of Amazon surpassed that of the Walmart, one of the highest revenue earning retailer in the country of United States.
2 STAFF TURNOVER ISSUES IN AMAZON Description of the problem: Employee turnover in Amazon: It is already evident that, employee turnover rate indicates to the ratio of the number of workers leaving a company compared to the number of new employees with whom the vacant position are replaced. According to Cho et al. (2017), Amazon is considered to be at the second position, in terms of the rate at which employees are leaving their jobs in Amazon. The comparisonhasbeendoneonthebasisoftheratesofstaffturnoverinFortune500 Companies.Accordingto O’Connor (2013), pointedout that,the excessive work load as compared to the pay scale of the employees, lack of monetary as well a non-monetary motivation canbeconsideredasthemajorfactorscontributingtotheemployeeturnoverproblem encountered by Amazon. According to Kim (2015), if the pay scale of a company is compatible with the burden of works imposed on them, they feel that their hard work is valued and they feel engaged with the work, where as a low pay scale makes them feel less engaged with the organization and they leave the job losing interest in their job. All these indicate to the fact that employees are leaving Amazon as they are feeling less motivated and engaged with the company.Hence, it is evident that Amazon requires a strong employee retention policy and the company needs to prioritize employeemotivation while designing an effective employee retention policy.
3 STAFF TURNOVER ISSUES IN AMAZON Analysis in terms of theories on motivation Maslow’s need hierarchy Theory After an analysis of the issues faced by Amazon, it is evident that the company needs o to restructure its employee retention policies depending on the theories as well as concepts of motivation, so that employee turnover can be controlled. On or such theory of motivation is Need Hierarchy Theory of Motivation propounded by Maslow. Need Hierarchy Theory of Motivation, has been developed depending on the concept of human needs. According to this theory, human needs can be categorized into a sequential hierarchy, following a descending order- low to high clusters. This is alternatively termed as ‘five need clusters model’ (Mowday Porter and Steers 2013). ’ In other words, the needs depicted in the diagram are basic human needs showed from the lowest to the highest order. At the bottom of the pyramid containing the clusters of human needs, there is physiological needs. Physiological needs refer to the requirement of every individual to satisfy
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4 STAFF TURNOVER ISSUES IN AMAZON their biological drives. This include- the demand for food, demand for water, demand for cloth, demand for shelter. This need is capable of exerting a deep impact on human behavior. The fulfillment of this need completely depends on the remuneration employees are earning. If employees can easily fulfill their physiological needs and can save for their future needs as well, they feel motivated as well as engaged with their occupation. Safety as well as security needs are depicted in the next cluster. This refers to the need of the employees to be protected from any kind of physical damage accidents during work. If employees receive medical benefits that will protect them if they become injured while working, or if the family of the deceased employees receive family pension, in case of the death of the employee in accident during duty hours, this will meet the basic safety as well as security needs of the employee and they will be motivated to fulfill their responsibilities to the company. The next layers are ‘social’, ‘self esteem’ as well as ‘self-actualization’.Theseareotheraspectsthataredirectlyconnectedwithemployee motivation. The company needs to allow the employees a healthy social-life, recognition for their efforts to the company as well as leisure time to take rest and socialize. As per the esteem needs of the employees, it can be said that, employees should get a healthy workplace atmosphere, so that they are able to work with dignity. The company has to look after the fact whether the atmosphere of the workplace is allowing the employee to continue their duties without any kind of humiliation that curb the esteem of the employees. For this purpose the company needs to redesign its norms or rules.
5 STAFF TURNOVER ISSUES IN AMAZON Herzberg’s motivation hygiene theory,is another theory related to the motivation of the employees.Accordingtothistheory,employeesshouldgetahealthyworkplace atmosphere, so that they are able to work with dignity. The company has to look after the fact whether the atmosphere of the workplace is allowing the employee to continue their duties without any kind of humiliation that curb the esteem of the employees. For this purpose the company needs to redesign its norms or rules (Huffman Casper and Payne 2014). Design of an intervention The intervention should be intended to solve or improve the situation In order to throw lights on the interventions that can be made to prevent employee turnover first the other reasons responsible for the employees to become demotivated, should be discussed. Kim (2015), has marked the biased attitude of the former CEO of the company Jeff Bezos, towards some employees. According to Kim (2015), this gave birth to inequality in workplace and agitated employees who felt that they are less valued. Again, De Gieter and Hofmans (2015), consider that, the lack of empathetic attitude of the CEOs after Jeff Bezos has also contributed to the employee turnover problem encountered by Amazon. Hence, one of the interventions to prevent employee turnover is that, Amazon needs to keep in mind the fulfillment of the physiological needs of the employees as depicted in theNeed Hierarchy Theory of Motivation.Physiological needs include- the demand for food, demand for
6 STAFF TURNOVER ISSUES IN AMAZON water, demand for cloth, demand for shelter. The fulfillment of this need completely depends on the remuneration employees are earning. If employees can easily fulfill their physiological needs and can save for their future needs as well, they feel motivated as well as engaged with their occupation. This indicates that the company should make provision for increment in the remuneration as well as monetary non-monetary incentives, in order to prevent employee turnover and retain the draining of talents (Pereira Malik and Sharma 2016). Again, for the safety cluster depicted in the Need Hierarchy Theory of Motivation. Another intervention can be suggested employees to be protected from any kind of physical damage accidents during work. If employees receive medical benefits that will protect them if they become injured while working, or if the family of the deceased employees receive family pension, in case of the death of the employee in accident during duty hours, this will meet the basic safety as well as security needs of the employee and they will be motivated to fulfill their responsibilities to the company (Shucket al. 2014). Another intervention can be made to foster healthy work culture where employees can work with dignity. This will fulfill the esteem needs of the employees and motivate them to work with a positive attitude. Self-esteem needs implies, employees should get a healthy workplace atmosphere, so that they are able to continue their duties without any kind of humiliation that curb the esteem of the employees. For this purpose, the company needs to redesign its norms or rules (Gialuisi and Coetzer 2013). Apart from that Amazon needs to arrange employee engagement program. The company needs to renovate its policies regarding employee benefit. The company needs to make provision
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7 STAFF TURNOVER ISSUES IN AMAZON for the family pension of the deceased along with pension for the retired employees (Bryant and Allen 2013)Again, If employees receive medical benefits that will protect them if they become injured while working, or if the family of the deceased employees receive family pension, in case of the death of the employee in accident during duty hours, this will meet the basic safety as well as security needs of the employee and they will be motivated to fulfill their responsibilities to the company. The next layers are ‘social’, ‘self esteem’ as well as ‘self-actualization’. These are other aspects that are directly connected with employee motivation (Mowday Porter and Steers, 2013). Analysis and Conclusion: Analyzing the situation of the high employee turnover rate of Amazon, it can be concluded that, lack of motivation is one of the major causes why employees are leaving Amazon. In order to eliminate this cause, Maslow’s need hierarchy Theory along with the Herzberg’s motivation hygiene theory should applied while designing the policies for retaining employees (Waldman Carter and Hom 2015). There are other factors that contribute to the massive employee turnover that the company is facing. Cao Chen and Song (2013), has mentioned that, often workers are hired in Amazon, on the basis of the temporary contracts of 11 months. They leave the company after their tenure is over. The objective of this policy is to incur saving on the medical coverage as well as the paid leaves of the employees serving only for 11 months. In its course of broadening saving policies as well as benefits, the company is actually suffering from employee turnover. Hence, Cao Chen and Song(2013) has suggested for a
8 STAFF TURNOVER ISSUES IN AMAZON renovation in the recruitment policy of Amazon so that the chances of employee turnover can be minimized.
9 STAFF TURNOVER ISSUES IN AMAZON References Bryant, P.C. and Allen, D.G., 2013. Compensation, benefits and employee turnover: HR strategies for retaining top talent.Compensation & Benefits Review,45(3), pp.171-175. Buzeti, J., Klun, M. and Stare, J., 2016.Evaluation of measures to reduce employee turnover in Slovenian organisations. Cao, Z., Chen, J. and Song, Y., 2013. Does Total Rewards Reduce the Core Employees' Turnover Intention?.International Journal of Business and Management,8(20), p.62. Cho, Y.N., Rutherford, B.N., Friend, S.B., Hamwi, G.A. and Park, J., 2017. The role of emotions on frontline employee turnover intentions.Journal of Marketing Theory and Practice,25(1), pp.57-68. De Gieter, S. and Hofmans, J., 2015. How reward satisfaction affects employees’ turnover intentions and performance: an individual differences approach.Human Resource Management Journal,25(2), pp.200-216. Gialuisi, O. and Coetzer, A., 2013. An exploratory investigation into voluntary employee turnover and retention in small businesses.Small Enterprise Research,20(1), pp.55-68. Hom, P.W., Lee, T.W., Shaw, J.D. and Hausknecht, J.P., 2017. One hundred years of employee turnover theory and research.Journal of Applied Psychology,102(3), p.530.
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