The Role Of Human Resource Management In Employee Engagement And Retention

The Importance of Employee Engagement in Organizational Success

Employee engagement is defined as the emotional investment that employees make in a company (G, S and R, 2019). Employees lead by example, bringing to work their passion, commitment, and drive. Engaged employees identify with the organization’s vision and link their personal ambitions to the company’s (Sweem, n.d.). Employee engagement is becoming increasingly important around the world. Employee retention and organizational success benefit from high levels of employee engagement. It’s a business issue that needs to be taken seriously. In this regard, human resource management (HRM) practices play a critical role as a centre of a company entity and are a great factor in promoting employee retention (Al-Emadi, Schwabenland and Wei, 2015). In this report, we’ll go over the role and influence of human resource management on employee engagement and retention.

Due to the competitiveness of today’s human resource market, employers are increasingly viewing people as assets instrumental in maintaining industry competitiveness by utilising their competencies, expertise, and skills (Lado and Wilson, 1994). This stems from the premise that engaged employees, devoted to their companies have several important competitive benefits, such as fewer employee turnover and increased productivity (Vance, 2006).

Employees in all sectors are encountering greater pressure these days as their bosses’ demands rise (Cappelli, 1997).  Standards are introduced regularly, new techniques and technologies, systems, procedures, and, necessitating a great deal of effort on the part of workers to keep up with the changing trend. Organizations are getting increasingly concerned with their employees’ psychological well-being to sustain high output and efficiency (Nielsen et al., 2017). This implies that businesses seek engaged employees who go above and beyond in accomplishing a task rather than simply ‘doing their job.’  If employees are not engrossed in their jobs, the majority of them will be there to majorly there to make money. As a result, good HRM practices can lead to higher levels of employee engagement and hence retention. 

The aim of this study is to investigate how human resource management practices affect employee engagement and retention.

To accomplish the above aim, the researcher has formulated the following objectives, which are listed further below:

1. To explore if HRM has to assist an organisation in retaining staff.
2. To identify what HRM can do to promote employee engagement.
3. To discuss how often the HRM are using various structures and resources for the construction of skills and aptitudes of workers.

1. Does HRM have to assist the organisation in employee retention?
2. What can HRM do to promote employee engagement?
3. How often does HRM make use of structures and resources to develop worker skills and aptitudes?

The research hypotheses are as follow:

Hypotheses 1/ That the HRM has to assist organisations in employee engagement and retention.

Hypotheses 2/ That there are steps taken by HRM to play an active role in employee engagement.

Hypotheses 3/ That the HRM often use various structure and resources for the construction of skills and aptitudes of workers.

Existing literature on HRM practices and their relationship with employee engagement argue that using HRM practices, which include a wide range of performance management systems, recruitment and selection processes, wide-ranging employee engagement and development, compensation management, and contributes positively to a firm’s present and future workers’ expertise, skill, and ability reducing shirking, increasing their motivation and enhancing employability (Chahar and Hatwal, 2018). Positive employee engagement has been linked to individual and organizational achievement as well as employee retention in a previous study (Osborne and Hammoud, 2017).

The Role of HRM Practices in Employee Engagement and Retention

Through Performance Engagement Employees And Their Supervisors Set Performance Goals And Expectations That Link The Work To The Department And Corporate Mission. It assesses individuals’ abilities against a set of observable competencies and behaviors that are relevant to the job. Employees’ chances of excelling at their employment, getting paid based on performance, and having opportunities to advance in their careers are all improved by using the performance engagement process.

Praise, motivation, feedback, promotion decisions, setting direction and priorities, and organizational change decisions all play a role in performance engagement. Employee engagement in performance is aimed at assisting employees in understanding their motivation (Vance, 2006). HR managers and staff cooperate to fine-tune responsibilities and duties so that they are more effective. Praise, according to management experts, is a terrific and free approach to enhance engagement, performance, and retention (Employee Recognition: The Power of Compliments, 2022). Employee retention can be greatly influenced by positive reinforcement and appreciation. It’s easy to underestimate the value of praise; it’s one of the most effective ways to motivate people and help them realize their maximum potential. Furthermore, praise incentivizes employees to take on additional tasks to be recognized again and again, leading to increased employee morale. Also, making it easy for employees to give positive and significant feedback can help workers relate their work to the organisation’s values and increase engagement and retention. Giving the right kind of feedback both helps build trusting relationships and improves an individual’s work performance, both of which are critical elements in job satisfaction and long-term employee retention. Wage decisions, such as salary, are important.   Low pay makes employees feel undervalued and is a major source of employee turnover (Shukla and Sinha, 2013). Salary review is an important aspect of employee retention since it can boost employee engagement, motivation, and productivity.

Many philosophers, researchers, and academics in the field of HRM have written articles calling for a proactive approach that prioritizes personnel and employee engagement over problem-solving approaches. A highly engaged workforce boosts a company’s competitiveness, according to a study (Kumar and Pansar, 2016). Employee involvement has been linked to overall organizational performance in previous research (Amah and Ahiauzu, 2013). In academic study, employee engagement is usually viewed as a good and job-related mental state. Preliminary studies had previously demonstrated a correlation between performance and employee engagement (Motyka, B., 2018), therefore academics and researchers were enthusiastic about this notion.

Academics and researchers have paid a lot of attention to the drivers and implications of employee engagement in past years. To obtain a better grasp of the subject, several studies have begun to look at it.  Many HR professionals and managers are unsure how to promote employee engagement. According to a previous research by a multinational consulting organization, 87% of employees globally are disengaged (Mann and Harter, 2016). Other research on employee involvement, indicates that HRRM should seek to know employees’ attitudes by inquiring how they are feeling and what they think may be done to better the workplace environment (Vance, 2006). The initiative and action may differ depending on the size, resources, and culture of the organization.

Literature Review of HRM Practices Related to Employee Engagement and Retention

Employee engagement stresses employee commitment and involvement, especially in service-oriented businesses. It is important since it is influenced by factors related to the job, such as HRM practices. Another study highlighted their observations on HRM practices, stating that the relationship between employee engagement and productivity is still unclear and that more study in the subject of HRM is needed (Aktar and Pangil, 2017). Additionally, Chen discovered that various HRM approaches can have a wide range of impacts on employee behaviour (Chen and Huang, 2009), thus it is much more necessary to develop successful HRM practices that pay accurate attention to employee involvement.   HRM practices affect employee impression, behaviour, and attitudes. A previous study has discovered a correlation between positive employee engagement and employee retention (Collins, Collins, McKinnies and Jensen, 2008).

The key to retaining talented individuals is to use the right human resource management methods. HRM practices should be based on current analyses of the organization’s and employees’ demands. Several HRM approaches are functional and have a positive impact on skilled personnel. Jeffrey Pfeffer, the creator of the well-known idea of human resource management practices, created a list of HRM practices that have been reduced, reinvented, and enhanced over time as the economy and labor market have changed (Pfeffer and Jeffrey, 1998). Miao et al. underlined that well-chosen HRM methods should broaden individuals’ knowledge and abilities while also assisting them in problem-solving (Tej et al., 2021). Human resource management should adopt techniques that improve employees’ emotional attachment to their firms, as well as promote a positive work environment. HRM should adopt strategies that build employees’ emotional attachment to their organizations, instill a sense of moral obligation to stay with the company and increase employees’ organizational commitment.

Research has shown that the way human resources are handled and the leadership style used has a direct impact on the ability to keep and retain existing employees (Markos and Sridevi, 2010). The first step in reducing employee turnover is to create an organizational environment that encourages talented employees to stay. Developing an effective human resource management plan requires identifying the reasons why people leave the company (Allen, Bryant and Vardaman, 2010). Conducting in-depth interviews with departing employees is one way to gather this information. Work stress, insufficient staffing, poorer support, communication, and cooperation in the company are the primary causes for employees leaving firms (with a high turnover rate), according to Knight’s and colleagues’ research (Rickard et al., 2012). Based on the foregoing, a statistically significant association between a set of human resource management techniques and the retention of skilled individuals in firms can be assumed.

All organizations recognise the need for on-the-job staff training. Hardly a firm can maintain long-term growth if the firm’s core, i.e. its employees, are not productive. Professional training and development is crucial for both enhancing and sustaining their productivity (Sal and Raja, 2016.). Workers should take advantage of training to boost their productivity while also remaining connected with the organization’s vision and objectives. Human resource (HR) training and development is an important part of any business. A company’s competitive edge might be enhanced by having astute employees who can apply what they have learnt.

HRM is crucial in ensuring that the training and development process runs smoothly (Anitha and Kumar, 2016). HRM’s responsibilities don’t end with effective onboarding; in fact, HMR should monitor workers’ performance throughout their careers. Employees’ potential is recognized by a strong HR leader, who pushes them to maximize their training time. The purpose of a professional HR is not to replace a vacancy; rather, he or she wants to help employees succeed by providing effective and efficient training programs. If HR experts give employees appropriate learning management platforms, they may effectively collaborate within the firm.

This part deals with the steps used for data analysis and the process for interpretation.

To construct a successful research design, the Saunders Study Onion was used. The onion model consists of five parts that guide the researcher’s choice of research design. The model provides a systematic and methodical means to achieving this goal.

Figure 1: Saunders Onion Study model (Omotayo and Kulatunga, 2017)

Because positivism is based on reality and analyzes respondents’ opinions, it would be included in this study endeavour. This idea was used to gauge the influence of HRM strategies on employee engagement and retention, as it allows objective study and analysis.

Saunders et al. present the various approaches to research, including inductive and deductive methods (Saunders, Lewis and Thornhill, 2003). The deductive technique was in this study, to come up with hypotheses prior to conclusions.

This aids in the organization of facts gathered about the subject. A literature review and secondary data based on the Likert scale are two study methodologies that the researcher employed.

Research is classified into qualitative, quantitative, and mixed method research (Saunders, Lewis and Thornhill, 2007). The researcher used quantitative research choice because it produces objective data that can be clearly communicated through statistics and numbers. It also aided in the methodical examination of quantitative data and helped to predict and summarise the characteristics of the data and show how HR practices affect employee engagement and retention.

The researcher used secondary data to answer the research questions. In addition, data used was five-point Likert scale data spanning from strongly agree to strongly disagree showing the level of agreement of employees on various HRM practices. It was easier for the researcher to obtain consistent results as a result of this.

Since the available data is ordinal scale Likert scale data based on level of agreement, the analysis involved in determining the descriptive statistics containing measures of central tendency (i.e. mean, mode, median, and range) and the standard deviation and calculating percentages in the analysis.

To explain and analyze the estimated information essential to the research issue, the researcher used statistical analysis.

The descriptive statistics used are measures of dispersion and measures of frequency and measures of central tendency (Kaur, Stoltzfus and Yellapu, 2018).

The measures of central tendency used to analyse the data include the mode or the median and the mode.  For a given dataset, the central tendency is where most of the values lie.

The mode is the value with the highest frequency of appearing (Manikandan, S., 2011).

The median is the value that divides the top and lower half of the data (Manikandan, 2011). The median is significant because it shows the location of the dataset’s center value. Median M = (n+12)^th value of observation in ascending order.

Determining the mean necessitates executing arithmetic operations on the dataset that involve summations and division. With ordinal data, these operations cannot be performed for meaningful results because the differences between nearby values are unknown.

Arithmetic mean ?x =

These include the interquartile range and range to indicate the variability and the standard deviation (Manikandan, 2011). To determine the variability of the dataset, minimum, maximum, and range were found.

The lowest and highest numbers in the dataset give the minimum and maximum values respectively. Subtracting the minimum from the maximum gives the range:

The range is an indication of how different a given set of values are from one another.

This includes percentages. A percentage is the value gotten when one item is divided by the total sum of identical items and the quotient multiplied by 100.

The methodology applied to analyze the data has been shown in prior research to produce appropriate and correct results. Further, this research provided a solid foundation for future research.

This research used data from secondary sources are sources of dependable and respectable data. Statistical methods used in this research have been broadly used; hence, the reliability of the results is unaffected.

The researcher had no ethical issues with the data and information sources used in this study. The data in this report comes from secondary sources, making it trustworthy. There were no ethical issues with the data. The research was carried out in accordance with the UWL’s research protocols and ethical regulations.

This chapter delves into the general statistics of the relevant data as well as a thorough data analysis of the results. The findings are the most essential component of the study since they establish whether the researcher’s hypotheses were accepted or rejected based on their analysis. The researcher analyzed the data, focused on the most significant findings, and presented the findings in a way that was consistent with the research questions.

Table 1 shows Median labour turnover rates by reason for leaving. A summary of the five-point Linkert type responses indicates the HRM practices that could have a direct bearing on employee engagement and turnover. Tables 2 and 3 use the Linkert responses to gain insight into the participants’ levels of agreement and their feelings concerning the various HRM practices.

A report by the Chartered Institute of Personnel and Development (CIPD) (2017) shows that the median rate of employee turnover has climbed to 16.5 percent. Although more than 80% of firms had trouble keeping one or more categories of workers in 2016, a higher percentage than in past years, roughly 40% of organizations took deliberate actions to increase employee retention in 2016.

The most popular technique for promoting staff retention was expanding training and development opportunities (at about 58 percent).  There is a 56 percent improvement in the induction process after that, as well as 50 % improved benefits

In 2016, 84 percent of the organisations had difficulties retaining at least one category of their workers. That was a rise from 77 percent in 2014, 78 percent in 2012, 66 percent in 2011, 58 percent in 2010, 55 percent in 2009, and 69 percent in 2008. Table 1 shows CIPD the median labour turnover rates by reason for leaving (CIPD, 2017).

Table 1: Median  labour turnover rates by reason for leaving (CIPD, 2017)

	2016	2014	2013	2012	2011	2010	2009	2008
Voluntary redundancies	0	0	0	0	0	0	0	0
Compulsory redundancies	0	0	0	0	0	0	1	0.5
Dismissed/left involuntarily (including death in service)	1.2	0.7	0.21.	1.3	0.6	0.7	0.9	1.4
Fixed-/short-term contracts	0.7	0	0	0.4	1.7	0	0	0.7
Retired	0	0	0	0.1	0.5	0	0.4	0.7
Left voluntarily	10	5.5	5.6	7.3	7.8	6.6	8.4	9

From the table, it is clear that the greatest reason for employee turnover was voluntary leaving of work. This can be traced to the impact of HRM practices on employee engagement.

2 below show the percentage CIPD median labour turnover for London between 2005 and 2016:

20
18	18
18		17								16.5
			16
16
14				14	13	13			14
12							12
10								10
8
6
4
2
0
2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2016
(2006	(2007	(2008	(2009	(2010	(2011	(2012	(2013	(2015	(2015	(2017
survey)	survey)	survey)	survey)	survey)	survey)	survey)	survey)	survey)	survey)	survey)

Figure 2: Median rate of labour turnover(%) (CIPD, 2017)

Table 2 shows the level of agreement of workers with performance management practices.

Table 2a: Performance management

	Performance management(N=100)	Strongly agree	Agree	Uncertain	Disagree	Strongly Disagree	TOTALS
1	Targets and their due dates are clearly communicated  to staff members	45	24	12	22	19	122
2	The performance review focuses on evaluating my competencies and abilities	19	18	12	21	30	100
3	I receive good feedback on my performance appraisal	23	15	9	20	33	100
4	My performance appraisal is discussed with my supervisor	23	22	35	10	10	100
5	The weaknesses detected in the appraisal lead to training as a staff development  initiative	29	25	7	22	17	100
6	My organisation conducts performance  reviews regularly	43	29	2	8	12	94
7	My personal objectives are aligned to the business goal	15	33	22	23	18	111

The descriptive analysis of the results in table 2a is shown in table 2b.

SA		A		UC		DA		SDA
Mean	28.14286	Mean	23.71429	Mean	15.57143	Mean	18	Mean	19.85714
Median	23	Median	24	Median	12	Median	21	Median	18
Mode	23	Mode	#N/A	Mode	12	Mode	22	Mode	#N/A
Standard Deviation	11.65373	Standard Deviation	6.156684	Standard Deviation	10.90653	Standard Deviation	6.244998	Standard Deviation	8.629959
Range	30	Range	18	Range	33	Range	15	Range	23
Minimum	15	Minimum	15	Minimum	2	Minimum	8	Minimum	10
Maximum	45	Maximum	33	Maximum	35	Maximum	23	Maximum	33
Sum	197	Sum	166	Sum	109	Sum	126	Sum	139
Count	7	Count	7	Count	7	Count	7	Count	7
Largest(2)	43	Largest(2)	29	Largest(2)	22	Largest(2)	22	Largest(2)	30
Smallest(2)	19	Smallest(2)	18	Smallest(2)	7	Smallest(2)	10	Smallest(2)	12

Figure 2c shows the total percentages of respondents who agreed, those who were uncertain, and those who did not agree. The same is depicted by the pie chart representation in figure 3 below

Table 2c: Percentages of the levels of agreement with Performance management

Statement	percentage	Totals
SA	27.1%	40.7%
A	22.8%
UC	13.6%	13.6%
DA	17.3%	33.8%
SDA	16.5%

 

 Figure 3: Pie chart representation of percentages of the levels of agreement with Performance management

Table 3a: Level of agreement with Recruitment and selection practices

	Recruitment and selection (n=100)	Strongly agree	Agree	Uncertain	Disagree	Strongly disagree
1	The total benefit packages advertises to intending employees is attractive	13	19	26	37	5	100
2	A skills audit  is conducted to assess skills gap	19	11	22	38	10	100
3	The recruitment  process provide  for an extensive selection of talent	15	29	42	10	4	100
4	Before a vacancy is advertised, effort is made to tap from the internal talent pool	10	14	19	29	28	100
5	Induction programmes are well structured to help the new  employee settle in	19	22	17	24	18	100
6	There is  a sufficient pool  of managerial talent is available  to fill vacancies	22	18	33	19	8	100
7	The  recruitment  process succeeds in selecting the best talent.	23	31	11	21	14	100

Table 3b: descriptive statistics (Recruitment and selection practices)

SA		A		UC		DA		SDA
Mean	17.28571	Mean	20.57143	Mean	24.28571	Mean	25.42857	Mean	10.42857
Median	19	Median	19	Median	22	Median	24	Median	8
Mode	19	Mode	#N/A	Mode	#N/A	Mode	#N/A	Mode	#N/A
Standard Deviation	4.785892	Standard Deviation	7.367884	Standard Deviation	10.4517	Standard Deviation	10.04751	Standard Deviation	9.58918
Range	13	Range	20	Range	31	Range	28	Range	28
Minimum	10	Minimum	11	Minimum	11	Minimum	10	Minimum	0
Maximum	23	Maximum	31	Maximum	42	Maximum	38	Maximum	28
Sum	121	Sum	144	Sum	170	Sum	178	Sum	73
Count	7	Count	7	Count	7	Count	7	Count	7

Table 3c: Percentages of the levels of agreement with recruitment and selection practices

Statement	percentage
SA	17.3%	37.9%
A	20.6%
UC	24.3%
DA	25.4%	37.8%
SDA	12.4%

Figure 4: Pie chart representation of percentages of the levels of agreement with recruitment and selection practices

Tables 2a-2c show the data and analysis of levels of agreement with performance management. The highest mean level of agreement lies with the respondents that strongly agreed (SA) to the statements posited concerning performance management at 28.1 respondents. This was closely followed by agreed (A) at 23.7, giving an overall mean for those who agreed as 51.8 respondents. Those who strongly disagreed (SDA) or disagreed (DA) had a mean of 19.9 and 18 respectively. Those of the uncertain respondents (UC) were at 15.6.  This gives an insight into the organisation’s commitment to foster HRM practices that contribute to performance management. A similar trend is shown by the pie chart percentages of the levels of agreement with performance management in figure 3. It is a pointer that the employees are more engaged and could be used to reflect the impression of employees towards the organisation concerning such issues as future career growth and development, understanding and embracing of the organisational vision, and general inclusiveness in the organisation journey to success. All these are HRM-related factors that determine employee turnover. Such a high overall mean of those who agreed with the positive statements of performance management could be an indicator that an organisation with such results is likely to retain about 50% of its employees and has a chance to work on retaining the 38 percent who were strongly agreed to curb avoidable turnover.

However, tables 3a-3c generally show fewer respondents agreeing with recruitment and selection practices. The mean of the respondents who overally agreed with the statements of recruitment and selection practices fell to about 38 respondents, those who were uncertain had a mean of about 24 respondents and those who disagreed had an overall mean of roughly 36 respondents. The same trend is depicted in table 3c and the pie chart in figure 4. This information shows that the HRM has a task ahead of them in ensuring that the employees regain confidence with the organization when it comes to selection and recruitment practices. Though there are satisfactory responses that the recruitment  process succeeds in selecting the best talent, there is a sufficient pool of managerial talent is available to fill vacancies and induction programmers are well structured to help the new employee settle in with 54%, 40%, and 41% of the respondents agreeing to the statement, only 32%, 30%, and 24% agree that the total benefit packages adverts to intending employees are attractive, a skills audit is conducted to assess skills gap and before a vacancy is advertised, effort is made to tap from the internal talent pool respectively. This, therefore, show that there is poor employee engagement concerning the later three recruitment and selection practices.

Conclusion And Conclusion

The findings were analyzed using facts and context to provide a methodical account of how HRM strategies affect employee engagement and retention.

From the literature review and data analysis, it is obvious that HRM has to play a role in employee engagement and these results in a positive impact on employee retention. All the practices outlined under recruitment and selection and performance management are HRM-related practices. This strongly indicates that an organisation’s HRM tremendously assists in employee engagement and retention. Therefore, hypothesis 1 is accepted.5.2.2 Objective 2: To identify what HRM can do to promote employee engagement

The HRM has a vast number of initiatives that they can implement and sustain to help build employee engagement.  Of interest in this research involve two key areas of recruitment and selection and performance management. These involve such practices as focusing performance review on evaluating employee competencies and abilities, regularly conducting performance reviews and performance appraisals and discussing it with the supervisors, conducting skill audits to address skill gap, sourcing for talent internally before advertising a vacancy, selecting the best candidate during the recruitment process, communicating targets clearly to staff members and ensuring that the new employees are properly orientated tp help them settle in. Hence, hypothesis 2 is accepted.

Though there are programs to assist in the development of employee skills and aptitudes, the performance review focuses on evaluating competencies and abilities, and the weaknesses identified in the appraisal lead to training as a staff development initiative, they do not directly point to the frequency with which HRM conducts them, except for the organization conducting performance reviews regularly, which respondents agree to overwhelmingly at 72 out of 94, possibly 76.6 percent. As a corollary, this may indicate the frequency with which the post-appraisal is applied to training as a staff development program, although this is not conclusive.

5.3 General Conclusion

This study concludes that HRM practices influence employee engagement and retention. From the descriptive findings of HRM practices namely recruitment and selection and performance management, respondents’ responses strongly point to the fact that for effective employee engagement and hence retention, HRM practices must be centered in understanding employee needs and addressing them in keeping with the HRM best practices. From a broader perspective, retention of highly engaged employees generally leads to high productivity and contributes positively to the work environment and organizational success in the long run.

The data being one variable ordinal Linkert scale data led to results that could not measure the direct relationship between the various HRM practices and employee retention. 

However, a more decisive evaluation of the impact of HRM practices on employee engagement and retention can better be determined by employee performance and turnover. Such research can only be more authoritative as a guide to company performance if it analyses the quantifiable value of employee performance and turnover.  

1. Future studies should involve data with more variables to give a clear relationship to the effect of one variable on the other.
2. That further study uses non-categorical data and instead adopts numerical data to produce more meaningful statistical results.

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