CHAPTER I INTRODUCTION. are required in producing goods and services (Ridlo, 2012). It leads to the

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Benedict Godwin Whitehead
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1 CHAPTER I INTRODUCTION 1.1 Problem Background Human resource is one of the most crucial assets the company has for they are required in producing goods and services (Ridlo, 2012). It leads to the importance of managing the human resource includes procuring qualified employees, retaining, and controlling cost associated with them (Cascio, 1987). The occurrence of turnover is something not expected by an organization. There are several contributing factors have been discussed as the cause of turnover; uncomfortable working environment, dissatisfied compensation, exhaustiveness, inexistence of job security, relationship with supervisors or colleagues, and many others (James and Mathew, 2012). The occurrence of turnover has disadvantaged employers in terms of cost, resources, and working motivation. It causes lost of employees and that a firm must seek for a replacement, with which during seeking for replacement, the required job to accomplish remains undone and has a potential to disturb the productivity of an organization (Ridlo, 2012). Other than that, turnover can influence the working motivation of remaining employees. Those who were meant to stay may start thinking to look for a new job, and in the end a chain of turnover (Ridlo, 2012). Further, Gray et al., (1996) explains that if there is an increase in turnover within an organization, this indicates lower motivation to 1

2 work. Other than that, it will lead to lower productivity, and increasing cost in managing human resource. The causes of turnover varies from external environmental factors such as economy, to the organizational variables such as type of industry, occupation, organization size, payment, supervisory level, location, selection process, work environment, benefits, promotions and growth (Achoui and Mansour, 2007). Other factors are individual work variables such as job satisfaction, pay and working conditions (Arthur, 2001). Finding out the root cause of turnover in an organization requires a deep research to specifically spot the main factors for different organization may have different causes of turnover. Thus, qualitative research is selected as a method to conduct this research in one of a growing IT companies in Special District of Yogyakarta. Information and Communication Technology (ICT) is getting more advanced. Unlike old-fashioned mobile telecommunication, smartphone and tablet has more than just call and text function, it also entertains the users by providing applications within. These applications which is known better as apps, has a wide range of categories include games, educations, e-commerce, utilities, travel, news, the list is endless. Markets of those apps are Android users, Apple users and Windows Mobile users respectively. The producer who creates the apps and releases them to market is called apps developer. This research is conducted in one of apps developer start up in Yogyakarta. The term start up refers to the starting phase of developing a business. There are growing numbers of start up in the province of Yogyakarta as 2

3 a census by JDV reveals 156 new developers within five years starting The company chosen for study is PT Gongsin Internasional Transindo (GIT). It is established in November 2013 and begins as a start up of mobile apps developer then grows to be web developer. One of problems in human resources management of PT GIT is the high turnover rate of employees. Based on the data obtained from the human resources department, since its establishment in the late 2013 until the late 2014, the total employees of PT GIT have reached a number of 25. Of all, there are only 11 of them who remain to stay in the company. It suggests that the employee turnover rate of PT GIT is 14 over 25 or 56%. Turnover rate in PT GIT ( ) Retained 44% Resigned 56% Figure 1.1 Turnover Rate in PT GIT Since Its Establishment in 2013 Regarding with the impact of this high turnover, the cost associated with hiring new programmer is relatively small, yet matters nevertheless. Other than that, IT professional in this case is programmer (dominant employees in the company) is very specific skill which makes looking for a new candidate to fill 3

4 in the empty position is not an easy task. The operational activity lies heavily on their programming skill, and a high turnover solely lead to lower motivation to work of employees and lower productivity of the overall organization. This is a problem- based research, instead of starting it with some theoretical background; it began with a real problem encountered in the company under investigation, then the relevant literatures that support it follows. This research is proposed to study the causes of employees voluntary turnover at PT GIT. The high voluntary turnover should be overcome to reduce overall turnover in the future. 1.2 Problem Formulation This research attempts to find out the causes of employee voluntary turnover rate at PT GIT and suggesting practical recommendations to reduce the number in the future. 1.3 Research Question This research is intended to answer the questions of: 1. What are the causes of employees turnover rate at PT GIT? 2. What are the impacts of high turnover rate to PT GIT? 4

5 1.4 Research Purposes The purposes of this research consist of: 1. This research is willing to discover the causes of employees voluntary turnover and its impact to PT GIT. 2. This research is willing to suggest management actions to PT GIT to overcome all the causes to reduce its turnover rate in the future. 1.5 Research Benefits This research will specifically benefit the management of PT GIT to assist them in reducing employees voluntary turnover rate and to overall apps developer start up who is thriving to retain their employees at best. 1.6 Research Boundaries The boundaries of this research comprises of: 1. Voluntary turnover by employees is a focus of this research, instead of involuntary one. 2. The ex-employees interviewed are those who had worked then resigned within a period of November 2013 (the establishment of PT GIT) until January 2015 (the end of duration of this research). 3. The contributing factors of voluntary turnover due to internal of management are given more attention in the managerial implications. 5

FACTORS THAT INFLUENCE JOB TURNOVER OF SOCIAL WORKERS IN THE DIRECTORATE OF DEVELOPMENTAL SOCIAL WELFARE SERVICES (DDSWS) IN NAMIBIA

FACTORS THAT INFLUENCE JOB TURNOVER OF SOCIAL WORKERS IN THE DIRECTORATE OF DEVELOPMENTAL SOCIAL WELFARE SERVICES (DDSWS) IN NAMIBIA BY CECILIA MATHE MABENGANO SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENTS