Chapter 7
Managing Employee Retention and Separation
Chapter 7 Learning Objectives
1. Explain how employee retention and separation align with overall HR strategy.
2. Explain the employee turnover process and describe methods that an organization can use to reduce undesirable turnover.
3. Discuss the potential benefits and problems associated with employee layoffs.
4. Describe effective methods of employee discipline, including the principles of due process and the actions of progressive discipline.
5. Describe effective methods for dismissing employees from an organization.
Chapter 7 Outline
7.1 How Can Strategic Employee Retention and Separation Make an Organization Effective? (pages 252-254)
• Employees are a primary asset of almost every organization.
✓ Replacing an employee who quits costs an organization between one and two times the annual salary of the position.
✓ Employee retention is a set of actions designed to keep good employees.
➢ Ensuring that nonproductive employees don’t continue with the organization is often just as important as retaining productive workers.
➢ Changes in economic conditions and product demand sometimes force organizations to reduce size of workforce.
✓ Employee separation is the process of efficiently and fairly terminating workers.
7.2 How Are Employee Retention and Separation Strategic? (pages 254-256)
• Strategic Emphasis on Employee Retention (pages 254-255)
✓ Retaining good employees is the essence of internal labor orientation.
➢ Competitive advantage comes from developing loyal workforce that consistently excels at satisfying customer demands.
➢ Loyal Soldier HR strategy: Internal labor orientation and cost reduction strategy.
➢ Committed Expert HR strategy: Internal labor orientation and differentiation strategy.
➢ Employee retention is not as critical for external labor orientation.
➢ For Bargain Laborer HR strategy, separations are seen as a necessary consequence of combining entry-level work with relatively low wages.
➢ For Free Agent HR strategy, those who leave can be replaced by individuals with more up-to-date knowledge and skills.
• Strategic Emphasis on Employee Separation (page 255-256)
✓ Employee separations are an important part of differentiation strategy.
➢ Differentiators rely on highly skilled employees.
➢ Committed Expert HR strategy focuses on terminating low performers.
➢ Free Agent HR strategy benefits from frequently replacing employees with others who bring new skills and a fresh perspective.
✓ Managing employee separation is not as important as cost reduction strategies: Loyal Soldier HR and Bargain Laborer HR strategies.
CONCEPT CHECK
1. Retaining good employees is most critical for which of the HR strategies? Loyal Soldier and Committed Expert HR Strategies.
2. Which of the HR strategies might encourage some employee separation? Committed Expert (where the necessary skills are not developed) and Free Agent HR strategies (to keep skills up to date).
7.3 How Can Undesirable Employee Turnover Be Reduced?
(pages 256-268)
• From the organization’s standpoint, the effect of an employee’s departure depends on whether the employee is a high or a low performer.
✓ Voluntary turnover: employee decides to leave.
✓ Involuntary turnover: organization terminates the employment.
✓ Functional retention: high-performing employees remain employed.
✓ Functional turnover: low-performing employees voluntarily quit.
✓ Dysfunctional retention: low-performing employees remain with the organization.
✓ Dysfunctional Turnover: adequate or better performing employee voluntarily quits.
• Recognizing Paths to Voluntary Turnover (pages 257-259)
✓ Quick Decision to Leave: begins with an external event that causes the employee to rethink the employment relationship, and the employee quits without much thought.
✓ Calculated Decision to Leave: an event causes an individual to begin thinking about leaving the organization. Interestingly, the decision is not influenced by alternative job opportunities but rather the decision is simply whether to stay or leave.
✓ Comparison with Other Alternatives: some external event initiates thoughts about leaving the organization, such as a job offer from another firm, and the individual begins to look at alternative opportunities
✓ Sense of Dissatisfaction: caused by a general sense of dissatisfaction with the job over time and no specific event can be identified as causing the employee to begin thinking about quitting. This leads the employee to either make a calculated decision or compare alternative opportunities.
• Understanding Decisions to Quit (pages 259-262)
✓ Important part of each path to turnover is lack of satisfaction with the current state.
✓ Low Job Satisfaction
➢ Job satisfaction represents a person’s emotional feelings about his or her work.
➢ Employees often make an overall assessment of their job satisfaction, but it can be divided into six dimensions:
° Empowerment
° Job fulfillment
° Pay
° Work group
° Security
° Work facilitation.
➢ Different values and perceptions mean that job satisfaction represents a complicated mix of feelings.
° Employee who is satisfied with one aspect of the job may not be satisfied with others.
° Not every aspect of job satisfaction is equally important to every employee.
° Some people may value empowerment more than security, whereas others will place greater value on security.
➢ Satisfaction with compensation is often the dimension most strongly related to overall perceptions of job satisfaction.
➢ Overall job satisfaction varies among organizations as well as among individuals.
✓ Withdrawal from the Organization
➢ Withdrawal is a progressive process whereby an employee who is dissatisfied pulls away from the organization over time.
➢ Early signs of withdrawal include
° increased lateness and absenteeism;
° giving less input to the organization;
° being less helpful toward coworkers.
✓ Exit from the Organization
➢ One important factor that determines whether workers continue in undesirable jobs is the availability and desirability of alternative jobs.
° Dissatisfied employees are likely to stay with an organization when they perceive that it will be difficult to find another job.
° People are also more likely to stay with their current jobs when they perceive that switching will have high economic and psychological costs.
➢ Some people are predisposed toward either high or low levels of satisfaction regardless of the work environment.
° Some are dissatisfied no matter how good a job is.
° People with chronically low job satisfaction tend to experience negative moods in all aspects of their lives.
° Some people tend to have dysfunctional characteristics such as perfectionism that undermine their feelings of self-worth.
° Individuals who are low on agreeableness often leave a job because they like doing things their own way.
° Individuals who are highly open to experience tend to leave to seek out new adventures
• Organizational Practices That Reduce Turnover (page 262-263)
✓ Work to ensure that employees’ needs are being met continuously.
✓ Need good HRM practices related to staffing, career planning, training, compensation, and workforce governance.
✓ Effective organizations develop ongoing procedures to find out why individuals leave.
✓ Each employee who leaves should have an exit interview where the interviewer tries to determine why the employee decided to quit.
• Assessing Employee Satisfaction (pages 263-264)
✓ Organizations seek to reduce turnover by frequently measuring employees’ job satisfaction.
➢ Done through surveys that ask employees about facets of work experience.
➢ Common survey is Job Descriptive Index, which assesses satisfaction with work tasks, pay, promotions, co-workers, supervision, demographic characteristics, work positions, and locations.
➢ Job satisfaction surveys are best when they ask interesting questions.
° Topics expected to be most important to employees should be placed at the beginning of the survey.
° Routine questions such as length of time worked and department should be placed at the end.
° Value of employee surveys can be increased by including items measuring how well the organization is meeting its strategic objectives.
✓ One problem with job satisfaction surveys is that the least satisfied employees are not likely to respond to the survey.
➢ These employees have already started to withdraw from the organization.
➢ They see little personal benefit in completing the survey.
➢ They see things as too negative to fix.
➢ They no longer care about the work environment of the company they are planning to leave.
• Socializing New Employees (page 264)
✓ Process of acquiring knowledge and behaviors needed to be member of organization.
✓ A key to effective socialization is interacting with coworkers and leaders.
• Building Perceptions of Organizational Support (pages 264-266)
✓ Those who feel supported reciprocate with feeling of obligation toward organization.
✓ Obligation results from actions of organizational leaders, better compensation practices, better designed jobs, fairness of procedures, and absence of politics.
• Selecting Employees Who Are Likely to Stay (page 266)
✓ Employees who have more realistic expectations about the job are less likely to quit.
✓ Can reduce turnover by directly assessing individual differences related to turnover.
• Promoting Employee Embeddedness (page 268)
✓ Embeddedness is the extent to which an employee is tied to the organization and the surrounding community.
✓ Can reduce dysfunctional turnover by insulating employees against shocks.
✓ People are more embedded when:
➢ they have strong connections to others,
➢ they have values and goals that fit with their environment, and
➢ they feel that leaving would result in monetary or psychological losses.
✓ Organizations promote embeddedness by providing:
➢ Enjoyable work,
➢ Desirable work schedules,
➢ Good promotional opportunities,
➢ Good benefits,
➢ Encouraging employees to build positive social relationships with coworkers,
➢ Encouraging employees to work in teams.
➢ Company sponsored service projects and athletic teams build similar relationships.
CONCEPT CHECK
1. What are four common paths to voluntary employee turnover? Quick Decision to Leave, Calculated Decision to Leave, Comparison with Other Alternatives, and Sense of Dissatisfaction
2. What perceptions and choices explain the process whereby low job satisfaction translates into a specific action of quitting? Dissatisfied employees will quit when they perceive that it will not be difficult to find another job. People are also more likely to quit their current jobs when they perceive that switching will have low economic and psychological costs.
3. What can an organization do to reduce voluntary employee turnover? Ensure that employees’ needs are being met continuously; have good human resource management practices related to staffing, career planning, training, compensation, and workforce governance; and have ongoing procedures to find out why individuals leave (e.g., exit interviews).
7.4 How Do Layoffs Affect Individuals and Organizations? (pages 269-274)
• Large scale terminations of employment (unrelated to job performance) are known as layoffs.
• The Effect of Layoffs on Organizations (pages 269-270)
✓ Many organizations lay off employees as part of an overall change effort.
✓ Downsizing: widespread layoffs intended to permanently reduce size of workforce.
➢ Effects of downsizing on organizations are not altogether clear.
° Financial performance of organizations that downsized is similar to performance of those that have not downsized.
° Effect of downsizing is not the same for all organizations.
° Most problems occur when an organization reduces its workforce by more than 10 percent and makes numerous announcements of additional layoffs.
° Firms that downsize to change before problems become serious are generally valued more by investors.
➢ Effective strategic planning can help an organization avoid layoffs.
• The Effects of Layoffs on Individuals (pages 270-272)
✓ The impact of downsizing goes beyond those who lose their jobs.
✓ Widespread layoffs can have a negative effect on employees who remain.
➢ Layoff victims individuals who lose jobs experience problems.
° Layoff victims are likely to suffer declines in mental health and psychological well-being, as well as physical health.
° Individuals with work-role centrality the extent to which work is a central aspect of life suffer more from job loss than do individuals for whom work is less important.
° Individuals who have more resources cope better.
° Individuals with a positive perception of their abilities to obtain a new job also cope better.
➢ Consequences for Layoff Survivors: individuals who continue to work for an organization when their coworkers are laid off react similarly to victims.
° An important factor in determining whether survivors will react positively or negatively is the fairness that they perceive in the layoff procedures.
• Reducing the Negative Impact of Layoffs (pages 273-274)
✓ Best method for reducing the negative impact of layoffs is to avoid them.
✓ Have clear plan and accurately forecast labor needs.
➢ Laying off low performers is generally more effective than laying off employees across the board.
➢ Encourage early retirement and/or reduce or eliminate overtime.
➢ Ask employees to share jobs.
➢ Employees might be transferred to other parts of organization experiencing growth.
➢ Organizations can have their employees perform tasks that were previously contracted to outside firms.
✓ Effective communication of downsizing decisions and plans is critical.
✓ Understanding legal issues is also important for successful downsizing.
CONCEPT CHECK
1. How does downsizing affect organizations in the short term? in the long term? The effects of downsizing on organizations are not altogether clear. Research suggests that the financial performance of organizations that have downsized is similar to the performance of organizations that have not downsized. The effect of downsizing is not the same for all organizations. Some organizations appear to benefit more than others. About half the firms that downsize report some benefit, whereas half report no improvement in profits or quality.
2. What are the common reactions of downsizing victims? Job loss begins a chain of negative feelings and events including worry, uncertainty, financial difficulties, declines in mental health and psychological well-being, physical health, and satisfaction with other aspects of life, such as marriage and family life.
3. How do employees who remain with an organization react when they see their coworkers being laid off? In some ways survivors’ reactions are similar to victims’ reactions. Negative reactions include anger at the loss experienced by coworkers and insecurity concerning the future of their own jobs. Positive reactions include relief that their jobs were spared, job satisfaction, commitment to the organization, and work performance. Survivors suffer less stress and fewer negative reactions when they believe the layoff procedure was fair
7.5 What Are Common Steps in Disciplining Employees? (pages 274-277)
• Sometimes employees fail to carry out their duties in an acceptable manner.
✓ Usually wrong to terminate problem employees without giving chance to improve.
✓ Discipline: process whereby management takes steps to help an employee overcome problem behavior
• Principles of Due Process (page 275)
✓ Due process: A set of procedures carried out in accordance with established rules and principles aimed at ensuring fairness.
➢ Employees have a right to know expectations and what will happen if they fail to meet them.
➢ Discipline must be based on facts.
➢ Employees should also have a right to present their side of the story.
➢ Any punishment should be consistent with the nature of the offense.
• The Process Of Progressive Discipline (pages 275-277)
✓ Some forms of misconduct are so serious that they result in immediate termination.
✓ Most offenses not serious enough to warrant immediate dismissal, and in these cases, due process requires the organization to allow employees to correct misbehavior.
➢ Progressive discipline process: Management provides successively more severe punishment for each occurrence of negative behavior.
° A supervisor meets and discusses company policy with an employee the first time an unacceptable behavior occurs.
° No further action is taken if misbehavior is not repeated.
° Subsequent instances of misbehavior are met with harsher punishment that eventually results in termination.
➢ Although the number of steps and actions differ by organization, most progressive discipline systems include at least four steps.
° Step 1: Verbal Warning
° Step 2: Written Warning
° Step 3: Suspension
° Step 4: Dismissal
✓ Supervisors are sometimes unwilling to take the first step in the process.
➢ Many supervisors seek to avoid conflict and so often ignore misbehavior.
➢ Managers reluctant to discipline when they perceive disciplinary process as unfair.
➢ Managers are most likely to discipline employees when
° they know they will be supported by leaders above them in organization.
° they have been trained to deliver discipline properly.
° there is a pattern of constructive discipline within organization.
CONCEPT CHECK
1. What are the four principles of due process? Employees have a right to know what is expected of them and what will happen if they fail to meet expectations; discipline must be based on facts; employees should have a right to present their side of the story; and any punishment should be consistent with the nature of the offense.
2. What are the steps for progressive discipline? Verbal Warning, Written Warning, Suspension, and Dismissal.
7.6 How Should Employee Dismissals Be Carried Out? (pages 277-279)
• Having to dismiss employees is one of the most difficult tasks that a manager faces.
• Outplacement Services provide assistance in helping dismissed employees find jobs.
• The Dismissal Meeting (pages 278-279)
✓ Managing this event in the right way is critical if the organization is to show respect for employees and maintain a good reputation.
➢ Face-to-face meetings are best and employees should not be dismissed on Fridays.
➢ Key principles should guide communication during a dismissal meeting.
° Best to have third person present to serve as witness.
° Tell employee directly that he or she is being dismissed.
° Meeting should be brief.
° If principles of due process have been followed, the employee should already know why he or she is being fired.
° Once the bad news is delivered, the manager should listen to the dismissed employee.
° There is no need to argue or defend the action.
° Present a written summary of the meeting to the dismissed employee.
➢ Dismissal meeting should include discussion of severance compensation if offered.
✓ Safety of supervisor and other workers is an important consideration.
➢ When possible, security personnel should be alerted.
➢ Security can provide assistance if a person becomes violent or makes threats.
➢ Dismissed employee may need to be escorted from the work site if the organization works with highly sensitive information or if the employee is being terminated for offenses such as theft or violence with coworkers.
CONCEPT CHECK
1. How can an outplacement firm help an organization manage employee dismissals? The firms are often in a better position to work with dismissed employees to help them find a new job, since these employees may feel some resentment toward the organization that dismissed them. Outplacement services normally include testing and assessments; employment counselors guidance to improve job search skills; financial planning advice; psychological counseling to deal with grief, anger, and anxiety; and some outplacement firms provide actual job leads.
2. What should a manager do and say when she tells an employee he is being fired? Because of the emotional nature of dismissal, face-to-face meetings are usually best on a day other than a Friday. In most cases, it is best to have a third person present to serve as a witness. It is important to state clearly that the person’s employment is being terminated in a brief meeting. Once the bad news has been delivered, the manager should listen to the employee who is being dismissed. Finally, it is usually best to present a written summary of the meeting to the employee being dismissed. The summary should include information like when the last day of employment will be, how to return company equipment such as keys and computers, and what will happen to health insurance and other benefits. The dismissal meeting should include a discussion of severance compensation if it is being offered.
Chapter 7 Teaching Notes
The following presents suggestions designed to help you utilize the special features and cases found in Human Resource Management: Linking Strategy to Practice
Summary: (pages 280-281)
Summaries of each of the four learning objectives are presented. It is recommended that students review each objective and discuss in class or in teams as a means of gaining better understanding and comprehension.
Learning Objectives:
The chapter contains five learning objectives. Each is presented at the beginning of the concept being discussed and can be found on:
Learning objective 1- page 264
Learning objective 2- page 256
Learning objective 3- page 269
Learning objective 4- page 274
Learning objective 5- page 277
Concept Checks
The chapter contains five concept checks. Each is presented at appropriate points in the learning objective being discussed and can be found on:
Concept 1- page 256
Concept 2- page 268
Concept 3- page 274
Concept 4- page 277
Concept 5- page 279
Tables and Figures
The table and figures presented in the chapter help illustrate the concepts of the chapter. They should be brought to the attention of the students and, perhaps, included in the exams where appropriate.
Table 7.1- page 261 Dimensions of Job Satisfaction
Table 7.2- page 263 Human Resource Practices That Reduce Turnover
Table 7.3- page 272 Alternatives to Layoffs
Table 7.4- page 273 Minimizing the Negative Effects of Layoffs
Figure 7.1- page 255 Strategic Retention and Separation of Employees
Figure 7.2- page 257 Types of Employee Turnover and Retention
Figure 7.3- page 259 Paths to Decisions to Quit
Figure 7.4- page 260 How Job Satisfaction Leads to Quitting
Figure 7.5- page 271 Coping with Job Loss and Unemployment
Figure 7.6- page 272 Responses of Layoff Survivors
Figure 7.7- page 276 Steps for Progressive Discipline
A Manager’s Perspective (page 250-251), What do you think? (page 251), and A Manager’s Perspective Revisited (page 279-280)
The chapter starts with a short scenario where Angela is thinking about her position as restaurant manager. She recalls how three people in two months have quit with little or no advance notice. She is also dreading a discipline meeting that might result in her firing a worker. Five true/false questions related to this scenario and the chapter topics are noted on page 251 and answered on page 279
Discussion of the chapter could start by posing these questions and asking for the class to vote on which questions are true through a show of hands, thumbs-up/thumbs-down, clickers, or paper copies of the questions. To keep student interest, the methods for identifying true answers should be varied.
The activity could be repeated near the end of the chapter discussion. At that time, students could be asked if they agree with the answers. The students also could be asked to identify what additional questions Rithica should ask.
During the discussion of the chapter material, you could refer to the questions noting that a certain section or discussion point addresses one or more of the questions.
For some chapters, you may wish to address the questions at the end of discussing the chapter. In this case, you may want to bring the students’ attention to these questions informing the students that they will be asked to answer the questions near the end of the chapter discussion. At that time, students (individually or in groups) could be asked to explain why the answers are true or false. Students also could add questions to the list and briefly explain why they think a new question should be asked. This could be done as a class or in smaller groups. If done in smaller groups, each group could be asked to briefly report on an aspect of their discussion.
Of course, one or more of the questions or more detailed versions of the questions could be included in an exam. If included in an exam, students should be warned that these questions might be part of the exam.
Building Strength Through HR: SAS Institute, Inc.
This special feature (pages 251-254) highlights several issues noted in this opening case regarding SAS Institute, Inc. (refer to pages 252-254). This case illustrates how HRM can help build an organization’s competitive strength by retaining productive employees.
The inset box (refer to page 254) presents some of the HR practices mentioned in the case but not all. Therefore, you could ask the students what other HR practices SAS employs to retain productive workers (e.g., all professional workers have private offices, employees are encouraged to spend dinnertime with families, etc.). You also could ask if these are HR practices that most organizations could or would do and what other HR practices a different organization could implement to retain their productive employees.
This discussion could be supplemented by students familiar with the SAS organization. Additional information may be found on SAS Institute’s webpage that briefly describes their philosophy regarding work-life balance: http://www.sas.com/company/sasfamily/index.html. In addition, there is a link to a short article from Fortune Magazine describing why SAS has been listed as one of the Best Companies. http://www.sas.com/news/preleases/ 2010fortuneranking.html
Supplemental information could be provided by a student responsible for updating the case and finding relevant information from the organization’s website or other sources. You should inform the students of any school policies that address contacting organizations.
Building Strength through HR: Convergys Corporation (page 258)
This inset box is briefly mentioned on the same page in the chapter (refer to page 258) Convergys uses an “early warning system” in which team leaders provide weekly assessments of each employee’s probability of quitting. These employees are offered alternative work schedules and many are referred to health and benefit programs.
The students could be encouraged to read the details in the inset box and read more by accessing the 2006 article. The website is listed in the inset box to facilitate this.
During the lecture or class discussion of the chapter, the brief information presented in the inset box could be summarized. You also may want to pose the following questions: (1) Why might the company ask for a weekly assessment? (2) Is a weekly assessment realistic for most organizations? If not, what might be a more reasonable timeframe? (3) Is it fair for those receiving a “red rating” to be offered alternative work schedules? If we can assume that this is valued by the employees, should Convergys make this alternative scheduling available to all employees? Do you think that the offer of alternative work schedules to all employees might reduce the percentage of employees who receive a red rating? Why or why not?
Overview of Activity
Identify HR practices utilized by Convergys Corporation that could reduce turnover of productive workers. Note: Convergys Corporation has been consistently listed by Fortune as one of the “The 100 Best Companies to Work for in America.” Thus, the organization’s website presents adequate information regarding relevant HR practices.
Exercise:
Refer to the inset box Building Strength through HR: Convergys Corporation found on page 258. Convergys uses an “early warning system” in which team leaders provide weekly assessments of each employee’s probability of quitting. These employees are offered alternative work schedules and many are referred to health and benefit programs.
The students could be encouraged to read the details in the inset box and read more by accessing the 2006 article. The website is http://money.cnn.com/magazines/fortune/ mostadmired/. Then they can identify various HR practices that the text authors have identified as potentially helpful to reduce turnover of productive workers. You should encourage the students to consider such practices as the organization’s culture, recruiting and selection techniques, benefits, etc.
Alternate Approaches to the Exercise:
Students could compare and contrast HR practices utilized in various organizations that could be used to retain productive workers. Many of the organizations listed in Fortune’s top 20 of “The 100 Best Companies to Work for in America” have helpful websites.
Links to relevant information
http://money.cnn.com/magazines/fortune/mostadmired/ http://www.convergys.com/company/company-overview.php http://money.cnn.com/magazines/fortune/bestcompanies/2007/
Technology in HR: Computerized Orientation Programs (page 265)
This inset box briefly addresses costs and benefits of computerized orientation programs.
The brief information presented in this box could be referred to during a lecture. Students can be asked for their experiences with online orientation or training. The students could be asked to speculate on reasons for the lower job satisfaction and organizational commitment of those employees who received the computer-based orientation and how these negative outcomes could be reduced.
The effectiveness of orientation programs (e.g., computerized, live, hybrid) could be researched by students.
Building Strength Through HR: FreshDirect (page 266)
This inset box briefly addresses how FreshDirect (an online grocer) reduced their turnover rate of over 200 percent to 75 percent.
After summarizing the information from the inset box, the students could be asked the following questions: (1) Is it realistic to tie a portion of the managers’ pay to turnover rates in their departments? (2) What behaviors might FreshDirect be expecting from managers when a portion of their pay is linked to turnover rates in their departments? (3) Should managers be held responsible for turnover that is not directly attributable to organizational factors (e.g., family moves, illness, internal transfers, etc.)? (4) How could employee reasons for turnover be tracked if some types of turnover will not be affected by managers?
How Do We Know? Are Coworkers Contagious? (page 267)
This inset box is mentioned on the same page of the text (refer to page 267). Researchers Felps, Mitchell, Hekman, Lee, Holtom, and Harman conducted two studies to answer two questions; 1) does having embedded coworkers make an employee more likely to be an embedded worker, and 2) does working with people who are looking for other jobs also influence other workers to also look for new jobs.
The researchers found that in the first study, an individual employee was less likely to quit if his coworkers were embedded in their jobs and in the second study, coworkers who were less embedded were more active in searching for other jobs.
The information reported in the inset box could be part of a lecture or class discussion. Students could be asked to speculate about their own coworkers’ perceived embeddedness or about the embeddedness of coworkers at previous jobs. Every effort should be made to discuss the situations without mentioning individual names.
Other ways to address this information could be through a short written assignment or a more in-depth research paper on embeddedness and its impact on employee and organizational performance.
How Do We Know? Do Managers Think Discipline Is Fair? (page 277)
This inset box is mentioned on the same page of the text (refer to page 277). Researchers asked 62 experienced HR managers to rate whether instances of discipline familiar to the managers were fair. The researchers concluded that managers perceive discipline as fair when the employee knew the offending behavior was wrong and expected punishment. The managers also felt that the discipline was fair when the consequence was appropriate.
One way to address this information could be through a discussion, short written assignment, or a more in-depth research paper on disciplining and its impact on employee and organizational performance. One written assignment could involve the students contrasting and comparing
progressive discipline and positive discipline approaches. Among other differences, positive discipline advocates replacing the term “warning” with “reminder” and having the supervisor counsel the employee during the first three steps. The final step (termination) is the same as progressive discipline. Sources include: D. Grote, “Discipline without Punishment,” Across the Board, September 2001), pp. 52-57, and J. Kay, “Vantage Point,” Nursing Management, UK, (June 2004), p. 8.
KEY TERMS (pages 281-282)
Discipline 274
Downsizing 269
Due process 274
Dysfunctional turnover 257
Embeddedness 267
Employee retention 252
Employee separation 252
Exit interview 263
Involuntary turnover 257
Job satisfaction 260
Layoffs 268
Layoff survivors 271
Layoff victims 270
Outplacement services 277
Perceived organizational support 264
Progressive discipline 275
Severance compensation 278
Socialization 264
Voluntary turnover 257
Withdrawal 261
Work-role centrality 270
DISCUSSION QUESTIONS (page 282)
1. How can SAS compete with other software firms when its employees appear to work less than the employees at competing firms? Answer: They could identify the lower performers and try to learn why they are less productive. SAS also could benchmark best practices in regard to HR practices that might identify higher performing job candidates and that encourage higher productivity.
2. Do you think a fast-food restaurant such as Arby’s would benefit from reducing turnover of cooks and cashiers? Answer: Perhaps. Arguments could be made either way. What could the company reasonably do to encourage employees to stay? Answer: Some of what they do might depend on what they learn from the employees. Arby’s may find that their workers want some job enrichment, flex-time, opportunities to do community work on company time, etc. What problems might occur if employees stayed for longer periods of time? Problems might include: low morale, low productivity, high absenteeism, low job satisfaction, low customer
service, etc.
3. Do you think the university you attend makes a concerted effort to dismiss lowperforming workers? Students’ answers will vary. How does the university’s approach to dismissing low performers affect overall services for students? Student answers might include low morale, poorly taught classes, poor advising, etc.
4. What are some specific events that might cause you to leave an organization without having found a different job? Students’ answers will vary.
5. Which dimensions of job satisfaction are most important to you? Would you accept less pay to work in a job with better coworkers? How important is doing work that you find enjoyable? Students’ answers will vary.
6. What things keep you embedded in your current situation? Are there personal and family factors that encourage you to keep your life as it is? Can you identify social relationships that might influence you to avoid moving to another university or a different job? Students’ answers will vary.
7. Why do you think organizations that lay off workers frequently fail to improve their long term performance? Answer: A main reason most likely is that they are doing a poor job of strategic planning and HR planning.
8. Some people who have been layoff victims look back on the experience as one of the best things in their lives. Why might a victim say such a thing several years after the layoff? Answers will vary. They might include that they found a better job that was less stressful and more rewarding with, perhaps, better job security. They also may have gained valuable experience in termination meetings that they can share with their new companies.
9. Can you identify a time when a low-performing individual has not been disciplined by a leader? How did the lack of discipline affect the poor performer? How did it affect other workers or team members? Students’ answers will vary.
10. As a manager, what would you say to a person whom you were firing? Answer: Get right to the point, telling the person that she or he has been dismissed. Then, listen to her or him. Also you would explain the termination process (what happens next), outplacement firm services, and severance pay.
EXAMPLE CASE: Apparel Inc. (pages 282-283)
Questions
1. What are some ways that managers might cope with negative emotions when they are forced to lay off employees? Answer: Training the managers in proper discipline techniques, developing fair procedures, and making sure the organization has a constructive discipline structure, including that the managers know that they will be supported by leaders). Students may also mention stress management techniques or talking to HR professionals or other managers about their feelings.
2. Why might someone argue that it is a good thing for managers to feel such negative emotions? Answer: Managers are more likely to follow due process procedures before terminating someone. Managers also are more likely to do everything in their power to prevent layoffs such as effective HR planning.
3. How do you think you would personally react to the task of laying off workers? Students’ answers will vary.
DISCUSSION CASE: County General Hospital (pages 283-284)
Questions
1. Turnover is high at almost every facility where nurses are employed. What aspects of nursing make turnover for nurses higher than for many other jobs? Answers include: low pay, lack of respect, high stress jobs, micro-managing supervisors, poor treatment by doctors, and not able to meet and socialize with others their age.
2. What programs do you suggest County General might implement to decrease nurse turnover? Be specific. Answer: One thing that County General could do is review the job duties and see if any should be redistributed to non-medical staff or nurse interns. They also could give a retention bonus for nurses that stay with the hospital for various ranges of months and years and have recognition ceremonies.
3. How might County General work with other hospitals to reduce nurse turnover? Answer: They could benchmark best practices in health and other industries. They also could work together to address some of the issues (e.g., have social events with nurses of different hospitals).
Experiential Exercise: Learning about Discipline Procedures (page284)
Questions: Students’ answers will vary.
Examine the Web site for your university to locate information that guides the disciplinary actions of supervisors. If you can’t locate this information for your university, visit a few websites for other universities. Examine the supervisor guidelines and answer the following questions:
1. What does the university do to ensure due process?
2. How many steps are in the university plan for progressive discipline? Are the steps similar to the four steps outlined in this chapter?
3. What involvement does the human resource department have in cases of employee discipline?
4. Does the site offer guidance for how to deal with specific instances of employee
misbehavior?
5. What steps can an employee take to appeal a disciplinary action?
6. Are any unions involved in disciplinary procedures?
7. Based on your experiences with the university, do you think supervisors actually follow the steps of progressive discipline?
Interactive Experiential Exercise: Turnover: Dealing with the Good, the Bad, and the Ugly at Global Telecommunications (page285)
Access the companion website to test your knowledge by completing a Graphics Design, Inc. interactive role play.
