Analysis of Employee Turnover and HRM Strategies: Leah's Bakery Report

This report analyzes the problem of high employee turnover at Leah's Bakery, highlighting its negative impact on the business's profitability and performance. The study identifies key causes of turnover, including employee dissatisfaction, inadequate salaries and benefits, lack of recognition, poor superior-subordinate relationships, limited growth opportunities, and a lack of connection with the enterprise. To address these issues, the report suggests implementing effective recruitment and selection techniques, providing comprehensive training and development programs, and focusing on enhancing job satisfaction through employee surveys and addressing areas of dissatisfaction. Furthermore, the report emphasizes the importance of motivational theories such as Herzberg's and ERG to improve employee motivation, and suggests the use of both extrinsic and intrinsic rewards to boost performance and retention. The conclusion underscores the need for Leah's Bakery to adopt improved HRM practices to reduce turnover and foster a more engaged and productive workforce.

HUMAN RESOURCE
MANAGEMENT

ABSTRACT
From the above study it is found that, organization is facing a high employee turnover
which is a major drawback for Leah's bakery as it increases cost for enterprise without increasing
in revenue and profit. Leah is working quite hard to improve the performance and productivity
for business corporate but bakery is going in a phase where it is less profitable than expected.
Enterprise has various positions which require talented and multi skilled employees. But Leah
has employed almost 240 employees in these 2 years but no has existed till date. This is because
employees are facing problem likes dissatisfaction, lack in recognition, low salary and benefits,
superior subordinate relationship and many others.
In order to improve the functioning, Leah can undertake proper recruitment and selection
technique which will help her to identify talented personnel from the mass of candidates. Further,
effective training and development program will help candidate to know the operations of
business corporate. Motivational theories like Herzberg and ERG will help Leah to motivate
employees who will help candidate to achieve their individuals and organizational goals.
Rewards can be given to human resource that will motivate them to perform their best and
provide productive result for corporate.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1...................................................................................................................................1
TASK 2...................................................................................................................................3
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................6

INTRODUCTION
Human resource management is a function which helps the organization to increase
employee’s performance in order to achieve their strategic objectives. It is basically concerned
with managing individuals within business corporate which concentrates on policies and systems
(Chand, 2015). Further, HR activities focuses on training and development, performance
appraisal, rewarding employees, maintaining working atmosphere and solving disputes within
the business organizations. HRM helps enterprise in attaining goals and objectives efficiently
and effectively by recruiting competent and motivated employees. This report is carried out for
the purpose of understanding better HR concepts (Deb, 2006). For this, case study of Leah's
bakery is given which deals with breads, pastries, and other types of baked foods. This present
report focuses on identifying cause of high turnover which Leah's bakery is facing. Further, it
also focuses on various motivational factors which enterprise can provide to their employees in
order to retain them. Further, it stresses on concentrating on various HR activities with the help
of various models. It also involves techniques to control labor to reduce high turnover rate of
organization.
TASK 1
Employee’s turnover
Employee’s turnover is a major drawback as it increases the cost for organization without
any mutual benefit to employees and enterprise (Murray, 2005). This usually happens when
human resources are not satisfied with the working condition and also with the environment they
are working in. Major cause of labor turnover in Leah's bakery: Dissatisfaction- Workers in today's generation want to show their talent and caliber and
want requisite salary to satisfy their individual’s goals and objectives. They are usually
focusing on to expand their skills, abilities and experience. This is the major cause of
employee’s high turnover as they do not have much to show their potential and talent and
they are usually fed up with the normal routine work with no essence of exposure and
development (Jiang and et. al., 2012). This dissatisfaction is also results in poor selection
procedure which is opted by Leah's bakery. This can be easily avoided by using effective
training and development process.
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 Inappropriate salaries and benefits-The major reason while employee's leaving business
corporate is the salary factor. Leah's bakery pays $6.50/hour to their retail clerk and
$9.50/hour to shift supervisor. For instance, if minimum wages in other bakery and
beverage industry is high and Leah's bakery is providing them low as compared to that of
market price than it will lead to high labor turnover with no motivation. Lack in recognition- Lack of recognition is the main reason why 25% of employees leave
their jobs. This is generally because employee does not want to remunerate by good
salaries and incentives (Deb, 2006). Apart from this, they want to get recognized by the
way how they are performing the job and what compliment they are receiving from their
customers. Superior subordinate relations- According to a survey, 30% employees leave their job
just because of their manager’s behavior. In Leah's bakery, the behavior of superiors
might not be good enough with their subordinates and this is the only reason that in 2
years 240 employees have been employed which results in an 800% of turnover. In order
to overcome this, managers and employee's in Leah's bakery have to communicate with
each other and they have to come up with a productive solution which will increase
employee's motivation level. Limited growth opportunity- This is also a major cause for employees leaving the Leah
bakery as they feel that, there are not enough development opportunities in the
department or bakery in which they are working in. After working for some days or
quarter of a year, they feel their duties are redundant and hectic. By getting dissatisfied,
they look for some other types of job (Millmore, 2007). This is the only reason for Leah
that she has seen that, over 240 employees have left the bakery in this 2 years period. It
further indicates that, the labor turnover is quite high as it is almost 800%. This
percentage is equivalent to employ a new set of employee's for 6 weeks. No connection with enterprise- Employee who are working are having no such
connection with Leah's bakery as employees have to follow all the major decisions which
are imposed by the manager. Therefore, it is clearly understood from the scenario that
Leah is opting autocratic style of leadership and where all the prior decisions are taken by
her only. This is also a major cause of employee's dissatisfaction as they are not treated as
a part of the organization.
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 Tools requirement- Enterprise have to provide modern tools to their employee's in order
to function their task and duties effectively. Employee's high turnover may be due to
traditional techniques which organization might be using for production process
(McGovern, 2012). However, this is also possible that, organization is using the latest
technology and employee's not having specific knowledge to work on it.
 Excessive working hours- Long working hours can lead to dissatisfaction for employees
as they are not able to make a balance between their personal and professional life. Leah
requires various positions for effective functioning namely 2 bakers for preparing pastries
and breads, a cake decorator, retail clerk and a shift supervisor. Bakery might have a long
working schedule which is not accepted by the employee's working there. This will
increase the labor turnover and financial cost to business corporate as it requires more
money, time and resources to fill the vacant position. Moreover, increasing rate of
turnover has lower employee's morale in bakery enterprise just because employee's
seeing their coworkers leaving the organization at regular interval of time (Storey, 2007).
TASK 2
Practices reducing labor turnover
Human resource management plays an effective role in both small enterprises and big
organizations. It further helps in developing new strategies and assists in developing strong
superior- subordinate relationship within business corporate. Recruitment and selection- Hiring the best candidate is the biggest favor which Leah can
do for her bakery. This is possible with the effective interview procedure which includes
summarized test procedure regarding the knowledge of bakery and other beverage
elements (Cheng and Li, 2006). Interviewer has to determine that candidate is capable for
performing their tasks and duties and whether candidates are satisfied with their work
which is assigned to them. Moreover, assessments like personal interview training and
development program will help Leah in retaining employees and increasing productivity
for business enterprise. Training and development- For effective functioning, Leah has to determine the current
workforce requirement within bakery. Further, in order to develop a specific skill,
training and development program will be necessary to improve their skills and
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qualifications. This training and development program can improve employee’s
efficiency (Armstrong and Taylor, 2014) Moreover, providing training to existing staff is
much more beneficial as it reduces cost and time for hiring new staff from external
sources of recruitment. This might be the strategy which Leah can implement in order to
reduce turnover and improve employee's retention.
 Job satisfaction- This plays an important role as Leah has a responsibility to determine
the level of employee’s satisfaction within bakery. This is possible with the help of
designing effective employee's surveys, exit interview strategy etc (Exit Interviews and
Checkout Procedure. 2015). Satisfaction of employee's plays a productive role as their
behavior leads to increase in customer base. In relation to this, Leah's bakery is having a
flat structure organization as there is no level of middle level management between top
level and lower level of management. Owner is acting both as a leader and as a manager.
This might be the major drawback as she is unable to handle activities together (Sparrow,
2007). To overcome this job satisfaction aspect, Leah has to determine the aspects of
employee's dissatisfaction and address all these issues in practical life to motivate their
employee's base.
Motivational theory
Motivation is a method which influences employees within business enterprise to achieve
their goals and objectives. Leah's bakery is facing problem of high labor turnover which is
increasing cost for venture. Motivation also includes reward which is received by human
resource on the basis of their performance. It is prior duty of Leah to motivate their workers for
effective functioning and healthy result for business corporate (Branine, 2008).
Corporate can use Herzberg theory which focuses on two major factors which will help
Leah to motivate employee's satisfaction level. This theory includes motivational and hygiene
factors. Motivational factor consist of healthy working condition, environment, recognition,
achievement, responsibility etc. Furthermore, hygiene factors are those which motivate
employees through basic salary, various compensations and incentives. Basic pay gives
manpower a good standard of living which motivates them in performing the task with best of
their capability and efficiency in enterprise.
Leah can also use ERG theory of motivation in which Alderfer has categorized Maslow's
hierarchy of needs in simple classes of needs (Purcell and Hutchinson, 2007). It constitutes:
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 Existence needs- This includes employees psychological and physical safety needs which
will help employees in giving best performance to achieve corporate goals and
objectives. Relatedness needs- This focuses on developing strong interpersonal relationship with
their colleagues and superiors. Maslow social and esteem needs comes under this
category (Coomber and Barriball, 2007).
 Growth needs- Employees require growth in Leah's bakery as this need focuses on self-
development, personal growth and advancement within business enterprise.
HR manager within cited company can consider two types of reward systems namely
extrinsic and intrinsic. Extrinsic rewards for employees within bakery are financial rewards
which they receive according to their performance and efficiency to complete a particular task or
order (Murray, 2005). These motivational rewards are target bonuses, basic salary, gifts,
allowances etc. On the contrary, intrinsic rewards are considered as non-financial reward which
involves good and healthy feedback from customer base, recognition, seniority, authority,
responsibilities etc.
CONCLUSION
From the above study it is clearly evident that, Leah bakery has a high labor turnover
which is affecting organization performance. This is because employees are not satisfied with the
policies, rules and regulations opted by business enterprise. It is also due to inappropriate
rewards and benefits given to employees without any sign of incentives and compensation.
Organization has adopted a flat structure system where there is only manager and employees.
Leah acting as a manager as well as a leader but she is unable to satisfy the needs and demands
of their employees. Further, this report concludes ways to overcome situations so highlighted.
Corporate can use better recruitment and selection procedure and can also give them proper
training and development program which will help them to know the operation of business
corporate. Job satisfaction plays a crucial role as Leah has to prepare effective performance
appraisal for their employees. This report also focuses on various motivational theories which
boost the morale of employee's and they will be able to work with best of their efficiency and
capability to achieve goals and objectives of bakery enterprise. Motivation theories like Herzberg
and ERG are studied thoroughly in the report.
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REFERENCES
Journals and Books
Armstrong, M. and Taylor, S., 2014. Armstrong's handbook of human resource management
practice. Kogan Page Publishers.
Branine, M., 2008. Graduate recruitment and selection in the UK: A study of the recent changes
in methods and expectations. Career Development International. 13(6). pp. 497-513.
Cheng, E. W. and Li, H., 2006. Job performance evaluation for construction companies: an
analytic network process approach. Journal of construction engineering and management.
132(8). pp. 827-835.
Coomber, B. and Barriball, K. L., 2007. Impact of job satisfaction components on intent to leave
and turnover for hospital-based nurses: a review of the research literature. International
journal of nursing studies. 44(2). pp. 297-314.
Deb, T., 2006. Strategic Approach to Human Resource Management. Atlantic Publishers & Dist.
Jiang, K. and et.al., 2012. How does human resource management influence organizational
outcomes? A meta-analytic investigation of mediating mechanisms. Academy of
management Journal. 55(6). pp. 1264-1294.
McGovern, P., 2012. HRM, Technical Workers and the Multinational Corporation. Routledge.
Millmore, M., 2007. Strategic Human Resource Management: Contemporary Issues. Financial
Times Prentice Hall.
Murray, J., 2005. Work and care: New legal mechanisms for adaptation. Labour & Industry: a
journal of the social and economic relations of work. 15(3). pp. 67-87.
Murray, J., 2005. Work and care: New legal mechanisms for adaptation. Labour & Industry: a
journal of the social and economic relations of work. 15(3). pp. 67-87.
Purcell, J. and Hutchinson, S., 2007. Front‐line managers as agents in the HRM‐performance
causal chain: theory, analysis and evidence. Human Resource Management Journal. 17(1).
pp. 3-20.
Sparrow, P. R., 2007. Globalization of HR at function level: four UK-based case studies of the
international recruitment and selection process. The International Journal of Human
Resource Management. 18(5). pp. 845-867.
Storey, J., 2007. Human resource management: A critical text. Cengage Learning EMEA.
Online
Chand, S., 2015. Human Resource Management: Meaning, Objectives, Scope and Functions.
[Online]. Available through: <http://www.yourarticlelibrary.com/hrm/human-resource-
management-meaning-objectives-scope-and-functions/35229/>. [Accessed on 5th October
2015].
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Exit Interviews and Checkout Procedure. 2015. [Online]. Available through:
<http://hr.utk.edu/policies/exit-interviews-and-checkout-procedure/>. [Accessed on 5th
October 2015].
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