Chapter I

The Problem

Background of the study

A retention program is one of the key in the success of the company.

Employees mostly rely their performance in the benefits they receive in exchange.

When an organization can motivate their employees through retention program they

give, they will achieve a high possible rate of success. Retention program will help

lessen the number of employee turnover. Employee turnover is a lost of investment for

the company thus loosing the chance to produce quality and experienced worker.

Retention programs like giving incentives to the employee in exchange for their

hardwork motivate them to work efficiently and effectively. The success of the company

mostly depends on employee performance. As soon as employee feel dissatisfied with

their employer and working environment they switch next to other company offering

greater opportunity.Lucrative salary, comfortable timings, better ambiance growth

prospects are some of the factors which prompt an employee to look for a change.

According to Johnson (2007), employees’ retention is reliant on management

leadership skills and human resource strategies. . Company benefits, employee attitude

and job performance are all factors which play an important role in employee retention.

The only way to increase employee retention and employee performance is proper

motivation and management involvement (International Labor Organization, 2010, p.13-

118). Employee motivation is through giving greater salary, incentives, commissions,

profit-sharing and other benefits such as vacation and other intangible items used as

1
rewards. A retention program does not only mean in terms of monetary value, it is also

about recognizing and giving complements for their hardwork. It will help the employees

to boost up their confidence and will make them comfortable of the working

environment.

Long term employees are considered as the main asset of the organization.

Because they provide quality work, accurate analyzation and faster working skills

compared to new comers. It is very important that employers retain their employees,

especially the good and experienced ones. It helps reduce in wasting time to train new

employee and integrating them into the organization. Hiring new employees means an

investment of the company.When a company replaces a worker, the company incurs

direct and indirect expenses. These expenses include the cost of advertising,

headhunting fees, human resources fee and new hiring cost.New comers cannot work

as effective and efficient as the old employees. The company will give training which in

turn lead to additional cost of the company. It is a do or die situation for a company, if a

newly hired employee cannot survive with the training, it means a waste of investment

in the company.

Employee retention helps towards the economic balance in several aspects like

job safety, additional profits and extra spending in goods and services. Retaining the

employees is crucial for the economic development of the industry as an organization, it

can give more time in creating and les time training them (Vasquez, 2014). Whereas on

the other hand, according to (Whitecomb, 2012) attracting, retaining and engaging the

employees produce quality results for the industry which leads to good customer

satisfaction.

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 Retention strategies are important because they help create a positive work

environment and strengthen an employee commitment to the organization.This study

will help all business establishments to understand that employee’s retention programs

play a significant role on job performance. This study will also help employers to

implement programs such as flexible working arrangement and employee training

initiatives to reduce turnover.

The study aimed to identify the retention program offered by the motortrading

companies to their employees. It also aims to know on how retention programs affect

the performance of the employee.This study is conducted in Koronadal City from first

semester to second semester in 2018- 2019.

Statement of the problem

The study aims to determine the Employee Retention Program of Motor Trading

Companies in Koronadal City. Especially, it aims to answer the following:

1. What is the profile of the Motor trading Companies in terms of:

 Number of Branches

 Years in operation

 Number of regular employees’

2. What are the retention programs given by the Motor Trading Companies to their

employees?

3. Whatare the effects of retention program of Motor trading Companies to their

employees?

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4. How effective is the retention program implemented by motor trading companies in

terms of job performance?

Significance of the Study

The people who will benefit in this study are the following.

 To the COMPANY,that may be able to find out what is the role of retention

program based on the performance of their employees so that they can make it

as a basis for implementing and improving their retention program for the

benefits of both organization and employees.

 To the EMPLOYEES, that may be able to find out what are the retention program

that the company offers. It will give them awareness and ideas about their

benefits it will also help them to be knowledgeable and motivated about the

programs given by the organization.

 To the ACADEME, that may be able to find out what are the retention program

offer to the employees. It will help to the student in the future if they will be

employed with this kind of institutions.

 To the RESEARCHER, that may be able to give them opportunity to acquire

reliable information and will help them to widen their understanding about the

research being conducted.

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  To the FUTURE RESEARCHER, that may be able to use some information

regarding retention program. Moreover, it can contribute more information to

those are willing to do the same study.

Scope and Delimitation

The study will focus on the Employee Retention Program of Motor Trading

Companies in Koronadal City. It was delimited to fourmotor trading companies within

Koronadal city, namely: Motor Trade, MUTI Corporation, Honda SocsargenInc.,Trumph

Motorcycle Corporation. These four companies are the leading motor trading companies

in Koronadal city that offers quality service to the customers. This study starts during

midterm of the first semester 2018-2019 and continue throughout the end of second

semester 2018-2019.

5
Definition of Terms

The following terms has been defined conceptually and operationally.

Company- is owned by one person or a small group of people. (Cambridge

Dictionaries). Operationally, it is defined as the organization that buys and sell products

and offer services.

Employees- Operationally, it refers to a person who works in a certain entity in

exchange for money. Conceptually it is defined by (Camphbell, 2007), an organization’s

success mostly is depends on the employee.

Performance- Operationally, it refers to; it performs to carrying an action that is carry

out an action in its best. Conceptually it is defined by (Sonnentag and Frese, 2001, p.5)

emphasized that performance is what the organization hires one to do, and do well.

Program- Conceptually it is defined asa plan of creation aimed at accomplishing a clear

business objective with details on what work is to be done, by whom, when, and what

means or resources will be used ( Cambridge Dictiniaries). Operationally, it refers to

method or plan implemented to achieve a certain goal of the organization.

Retention- is a voluntary move by an organization to create Chaminade (2007 cited in

Chibowa et. al 2010) according to Samuel and Chipunza 2009).Conceptually, it refers to

the most important purpose of retention is to look for ways to prevent the capable

workers from quitting the organization as this could be have a negative effect on

productivity and profitability.

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 Chapter II

Review of Related Literature and Studies

This chapter focuses on what other scholars have contributed on various issues

related to the proposed study. More especially, the chapter covers information on the

understanding of the concept of retention program, predicting effects of retention

program, how retention program should be structured, financial incentives and

employee performance.

Background Theories

Critical to the survival and competitiveness of the organization is its ability

to attract and retain talent. In a world where globalization has enabled organizations to

head hunt talent from around the globe, it is essential that organizational leaders

understand the factors that influences employees’ willingness to stay within the

organization (Brown &Yashioka, 2003). The reason is simple, people has always been

the edge for the successful organization(Messmer,et .al., 2008). As such, to be

competitive, to be the top in the industry, organizations must figure out how to attract

and retain its talent.

Unfortunately, retention of key employees is still a challenge today (Veloso et.

al., 2014). Factors such as excessive workload, job stress, accountability requirements

and financial uncertainties have challenged both profit and non-profit organizations in

their attempt to hold on to their skilled employees (Kim & Lee, 2005).Retention and

employee turnover are two terms that are closely linked to each other. Employee

turnover means the rate of employees leaving the organization and the employees

joining it. The turnover rate is often studied in organizations, and when the turnover rate

7
is high, it creates financial problems. When an employee who has been carefully

recruited and fully trained for a job decides to leave the company, it actually creates

monetary loss to the company. The company now has to use the same amount of

resources to recruit and train a new person for the job without necessarily getting any

benefit from the employee who decided to leave.

Johnny Taylor and Gary Stern, the authors of Trouble with HR: An Insider’s

Guide to Finding and Keeping the Best People, explain the cost of losing employees by

an example from HR Management magazine article from year 2008. The article noted

that replacing an employee would cost on average 100% to 125% of an employee’s

annual salary (Taylor & Stern, 2009, p. 65). Retaining the employees who have a good

person-job fit is the key to making the job profitable to the company.

Stephen Taylor (2002, pp. 10-11) introduces two perspectives on retention. The

first one states that reducing the employee turnover rate is desirable for all

organizations, and that in fact it should be the aim of initiatives in the employee

retention. It also suggests that improving retention / turnover rates in general is or

should be a central objective of human resource management policy. According to this

perspective, high rates of turnover are often seen as evidence of failing in human

resource functions. The author introduces also another perspective on the matter: after

a “new world of work” has emerged, the retention rates have raised because of the

flexibility of labor market. It is said that this is desirable, and the organizations should

actually focus their efforts on the retention of the most outstanding performers, those

few people in each section who can actually make a difference in the business.

8
 According to Taylor (2002), most of the employees on different levels of

organizations are so called average workers, but they in fact ensure that the show goes

on and take care of the basic objectives of the organization leaving room for the

excellent performers to shine. He reminds that there is a cost in every “departure” of

even the below-average performers (Taylor, 2002, pp. 10-11).To maintain talented

employees, organisationsneed to understand the factors which may influence an

employee’s decision to leave or to stay. Pilbeam and Corbridge (2010) outlined that to

identify the reasons why people leave is of assistance in being able to fully understand

the retention issues in organisations. The main causes of employee turnover can be

divided into four aspects. Taylor (2010) found that the four categories are pull factors,

push factors, unavoidable turnover and involuntary turnover.

Empirical Studies

International Studies

According to the study conducted in Kenya, it states that Johnson (2000) defines

employee retention as the ability to hold on to those employees you want to keep longer

than your competitors. Leign (2002) defines retention as keeping those employees that

keep you in business. Those are the performers not the incompetent, mismatched

disillusioned, plateaued or burnout employees. They must be the employees an

organization cannot afford to lose, the indispensable ones, the hardest to replace and

the most critical to the success of an organization’s business strategy.

A growing number of organizations are figuring out on how to win the war for

talent. They are committed to keeping their valuable employees because they know that

those are the people who keepthem in business. They realize that if people stay longer,

9
they get better at what they do, build stronger relationships with their most valued

customers leading to long-term success in the market place. In service economy where

premium is placed on knowledge and direct service, Leighn (2002) sees the winners of

war for talent as the winners of war for customers, market share, profits and long-term

value.

Retention is a complex concept and there is no single recipe for keeping

employees with a company. Retention has been viewed as “an obligation to continue to

do business or exchange with a particular company on an ongoing basis” (Zineldin,

2000). A more detailed and recent definition for the concept of retention is “customer

liking, identification, commitment, trust, readiness to recommend, and repurchase

intentions, with the first four being emotional-cognitive retention constructs, and the last

two being behavioral intentions” (Stauss et al., 2001). Studies have also indicated that

retention is driven by several key factors, which ought to be managed congruently:

organizational culture, communication, strategy, pay and benefits, flexible work

schedule and career development systems (Logan, 2000). Increasing numbers of

organization mergers and acquisitions have left employees feeling displeased from the

companies that they work and haunted by concerns of overall job security.

As a result, employees are now making strategic career moves to guarantee

employment that satisfy their need for security. On the other hand, employers have a

need to keep their stuff from leaving or going to work for other companies. In fact,

companies that offer employee development programs are finding success with

retaining workers (Logan, 2000). This is true because of the great expenses associated

with hiring and retraining new employees. The adage, good help is hard to find, is even

10
truer these days than ever before because the job market is becoming increasingly tight

(Eskildesen&Nussler, 2000).

Agrela, et al (2008) states the need to focus on the factors that affects retention

leading to growth and success of organizations. Studies suggests that retention

strategies, which effectively satisfy the needs of all employees consequently enhances

the ability for companies to adapt more effectively to ongoing organizational change

(Gale Group, 2006). Research shows that trends redefining modern retention strategies

go beyond the traditional salary and benefits package (Gale Group, 2006) and

compensation (Feldman, 2000) embracing employee motivation (Thomas, 2000), as

one of the key factors to cater to the diversity and long stay of the workforce in the

organization.

Retention factors incorporating the needs and desires of employees at any age

enhance levels of individual job satisfaction, loyalty, and commitment (Boomer

Authority, 2009). Cunningham (2002) states that employees rank employee recognition,

flexibility and training as top priorities for prolonging individual employment, while

Walker (2001) and others call for establishing a supportive learning and working climate

for employee retention.

Further, career development (Boomer Authority 2009), organizational

commitment (Patrick Owens, 2006), communication (Gopinath and Becker, 2000) and

superior-subordinate relationship (Zenger, Ulrich, Smallwood, 2000) are also the factors

known for prolonged stay of the employees in the organization. The list of retention

factors and literature review is not meant to be exhaustive of all possible theories or

variables related to employee retention and turnover (Griffeth et al., 2000). Rather, the

11
emphasis in this study is placed on testing the relative frequency with which various

retention factors emerge when analyzing employees’ versions for why they stay.

Work-life balance is increasingly important for engagement and affects retention.

Hyman et. al., (2003) in their empirical research in the UK found that interventions of

work demands into the personal life (e.g. working during the weekend) resulted into

heightened stress and emotional exhaustion among the employees. In a study

conducted by the Australian Telework Advisory Committee (2006) it was found that

70% of businesses that incorporated telework options reported a number of positive

benefits, such as increased business productivity and reduced costs, improved

employee flexibility and work life balance, and increased workforce participation.

According to Miller,et. al., (2001) employees get benefited by work environment

that provide a sense of belonging. Wells &Thelen (2002) have stated in their study that

organizations which have generous human resource policies, have a very good chance

to satisfy and retain employees by providing them an appropriate level of privacy and

sound control on work environment which enhances the motivation levels to commit

with the organization for the long term. Ramlall (2003) stressed the need for recognizing

the individual needs of an employee in an organization as it will encourage commitment

and provide a suitable work environment.

According to Messmer (2000) found that one of the important factors in employee

retention is an investment in employee training and career development. The

Organization is always invested in the form of training and development of those

workers from whom they expect to return and give output on its investment. Tomlinson

(2002) forwarded the view that organizations can keep the leading edge in this

12
competitive world by having their employees well trained in the latest technologies.

Garg&Rastogi (2006), explained that in today’s competitive environment feedback is

very essential for organizations from employees and the more knowledge the employee

learn, the more he or she will perform and meet the global challenges of the market

place. Handy (2008) has mentioned that proper innovation, and assimilation of new

knowledge is essential for survival in any work environment. This knowledge is the most

expensive asset of any firm.

According to Brunetto and Farr-Wharton (2002) were of the view that supervision

of the immediate manager increases the level of job satisfaction in the public sector

employees.McNally (2011) found some ways of retaining valued employees, such as

designing a compensationprogramme to reward valued employees, career opportunity,

development and growth paths they need to develop, encouraging work-life balance

and good communication.

Training is a key retention factor for employees at any age. Statistical evidence

indicates job training is a critical factor for personal (behavioral) and professional

(technical) development (United States Department of Labor, 2009). The availability for

all employees having access to training and development programs is critical in

facilitating organizational growth, particularly with performance and technological

improvements (Boomer Authority, 2009). Research supports that both the

organizational benefits and cost savings associated with training programs outweigh the

initial cost it incurs (Prenda& Stahl, 2001). Eisen (2005) states that training programs

available to all employees correlate with a 70% increase in employee retention rates.

Research indicates training methods that engage workers with career challenges,

13
advancement opportunities, work incentives, competitive wages/benefits, and

supportive work environments are effective retention strategies for employees of any

age (Eisen, 2005). Evidence supports the conclusion that access to regular training

programs enhances growth, prosperity, and retention for both employees and

employers (Amble, 2006).

Gunnigleet. al(2011) explored the extrinsic factors, specific pay, are the major

parts to analyze employees’ motivation which can be seen as traditional approaches.

Whereas exploring the motivation of individual employee’s satisfaction will be influenced

by a myriad of factors. found the following factors influence employees’ motivation:

personal characteristics: values, attitudes, etc. biographical profile (sex, age,

background) ,Job: intrinsic and extrinsic outcomes (nature of job, responsibilities, etc.)

and work environment: organizational climate and personnel policies (work design,

supervisory style, social relation) .

Asian Studies

Traditionally in China, loyalty to person is more important than loyalty to

institutions (Chen et al., 2002). Chinese organizations are typically dominated by the top

bosses and they are treated as the symbol of their organization. Therefore loyalty to the

organization in Chinese context is associated with loyalty to the leader (Chen &

Francesco, 2000). According to Chen et al. (2002) the supervisor is especially important

for Chinese employees as he or she often interacts with employees every day, acting as

the agent for formal and informal procedures of the organization and, most importantly,

taking care of rewarding employees.

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 Turnover behaviour of Chinese employees is affected especially by closest

supervisor, available career development opportunities, employee’s fit with the

community and organizational culture, and fair rewarding and compensation.

Finno -Chinese context creates unique mix of Finnish and Chinese culture where the

nature of retention practices is strongly affected by Finnish relational commitment

building HR. However, the implementation is in the hands of local HR and management.

Managing employee turnover is a process consisting of employee selection and

integration, skill development, training and coaching, and continuous measuring

and monitoring of the results of the process. (Rinne, 2013).

The results of the present study showed that working conditions influenced

retention of teachers. A number of teachers were not satisfied with several

aspects of their working conditions. Bonuses, inadequate teaching materials or

equipment, work boards and physical conditions of classrooms were reported as

major sources of dissatisfaction. Given the recent economic downturn and financial

constraints now being experienced in the Philippines, its ability to enhance working

conditions was severely constrained.

According to (Kukano, 2011), Job satisfaction improves employee retention. Job

satisfaction is a reliable and relevant predictor of employee retention. When

employers engage in practices that support good working relationships and

benefits, job satisfaction improves because workers tend to believe that the company

is using their skills and appreciating their service and commitment. In turn, higher job

satisfaction generally results in higher levels of employee retention. (Biason, 2014).

Chung-Hsiung Fang, Sue-Ting Chang, Guan-Li Chen (2009) has found that leadership

15
style can affect organizational commitment and work satisfaction positively and work

satisfaction can affect organizational commitment and work performance positively.

The factors for EEPL* were “competence & relationship oriented”, “scholastic &

futuristic Oriented” and “developmental & reward oriented”; while for MBPL*, the factor

were “relationship oriented”, “competence &scholastic oriented” and “reward oriented”.

The results indicate that these factors have substantial roles to play in making

employees stay and how at middle managerial level different aspects are valued while

deciding upon the retention strategies in similar contexts, (Sinha, 2013).

According to Kavitha, et. Al, (2011) found that in many studies, human resources

managers have evaluated changes in the cost of turnover between 50% and 500% of

the outgoing employee’s annual salary. They also indicated that there are six main ways

to retain employees, and these are communication, recruiting, pay, benefits, training

and job satisfaction. They also recommended that management should strategically

plan towards employee needs with specific retention programs.

Staff retention strategies aim to keep the staff that the organization wants by

satisfying their needs. Therefore, organization needs to assess its structure and

management to develop ways in which to improve employee retention. In effective

strategies to improve employee retention Involve attention to such areas as: Know

Thyself, Listen, Engage, Provide Autonomy, Trust and Reciprocity, and Communication.

(Fernandez andWorasuwan, 2017).

Organizational commitment, mission attachment, and employee engagement

were found to be significant predictors of employee retention. Although all are

significant, mission attachment is a better predictor for not-for-profit organization

16
whereas organizational commitment is a better predictor for for-profit

organizations. Furthermore, employee engagement was a significant predictor but

when compared with the other two, was the lowest. Finally, both adjusted r-square for

each type of organization was low. (Fukofuka, 2014)

Talent and talent management are still rather foreign concepts in HRM in Asia,

much to say retention. Even though some HRM and organizational behaviour theories

coincide 49 with or originate from Asia philosophy and business practices – which

means there is chance for Asia to relate with popular HRM theories, there is still

gap between the popular ones and the existing ones in Asia/East Asia. the modern

asian employee still demand reasonable salary, yes; but they also expect their

supervisors to be supporting, fair and respectable; they solicit challenging tasks that

would help them improve themselves professionally; the workplace must be

thriving, working condition flexible, and benefit packages all-rounded (both extrinsic

and intrinsic values offered). That sounds similar to the general talent retention steps

explained above, but not everything can be applied, and there is still long way to go until

turnover rate and talent scarcity is no longer a hot issue for HRM professionals in Asia.

(Le Thi, 2016).

Three types of the software development employees all highlight that job

satisfaction could be the most important factor that determines the turnover intentions in

the IT industry in Taiwan. It is deemed that for IT professionals, high demands in trying

new technologies and having meaningful assignments are enjoyable. In addition,

assistant managers received the highest score in job satisfaction in comparison to the

17
other two groups, which indicates that assistant managers could highly value their jobs

more than the other two groups. However, challenging work ranked last in the

responses of software engineers, and was not significant in the responses of project

leaders and assistant managers. This indicates that challenging work was not a priority

option for the Taiwanese software development employees.(Tseng and wallace, 2009).

Another related and typically Chinese aspect of organizational behavior is Guanxi

or personal network connections. Guanxi involves long-term personal relationships with

some aspects of interpersonal commitment and affect, but most fundamentally

obligation towards another person (Provis, 2008). In a study on the relationship between

demographic variables and organizational commitment in Chinese organizations, Chen

& Francesco (2000) concluded that Chinese employees behave differently from their

western counterparts due to the influence of traditional Chinese culture. They argued

that those employees who have good guanxi with the boss are more easily promoted to

the top positions. An employee with higher position, therefore, should be more loyal to

the boss or more committed to the organization (Chen & Francesco, 2000).

Traditionally Chinese culture is characterized by harmony and loyalty reflected in

values such as collectivism, social duty and respect for authority (Ma &Trigo, 2008).

Therefore, from the cultural background perspective stabile long-term employment

relationship should be highly appreciated among Chinese employees, yet in the recent

years, companies are facing high rates of turnover. The reasons for the situation might

be found from the changed labor market situation and low unemployment.

As Ma &Trigo (2008, 41) put it: “Current difficulties being experienced by

companies in retaining qualified employees are explained by the dynamism of the labor

18
market and the extraordinary opportunities that workers, especially at the managerial

level, can find in China which offset cultural idiosyncrasies.” However, they also

describe the new generation of Chinese managers as more individualistic, more

independent and more likely to take risks to gain profit than the managers from the older

generations. The traditional working culture might no longer be applicable to employees

of modern day China and the reasons behind employee mobility might be other than

just economical.

There is only handful of literature on turnover in Chinese context in English.

Many of the studies consider the pay the most important contributor to job satisfaction

and arguably to turnover intent. For example, (Chiu & Francesco 2003, p. 294) argued

that money and pay have a more important role in Chinese culture than in other cultures

and pay has satisfaction is one of the main contributors to job satisfaction. Chinese

employees rank cash-related items as the most preferred forms of compensation

differing from the studies made in Western world (Chiu & Francesco, 2003).

Supporting this notion, according to Leininger (2007) presented a study made in

2006-2007 on the main reasons for leaving a job. Chinese employees left because of 1)

better compensation package; 2) better career opportunities; 3) better benefits; 4) better

training and personal development opportunities; and 5) opportunities to utilize skills

offered in another firm. According to traditional Chinese thinking people are considered

to be successful in life when they can become financially self-sufficient and self-reliant

(Chiu & Francesco, 2003), thus partly enlightening the importance of compensation and

career progression to many Chinese employees.

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 Providing skill recognition of personal job accomplishments is an effective

retention strategy for employees at any age (Yazinski, 2009). Studies indicate fulfilling

peoples need for acceptance by acknowledging individual work accomplishments

prolongs employment of employees (Redington, 2007). In a Chinese study, Ling et al.,

(2005, cit. Ma &Trigo, 2008) found that the turnover intentions are influenced by

motivation and sense of achievement; corporate culture; compensation and benefits;

promotion and training; corporate profitability and prospects; relationships; and working

environment. A study by Yazinski (2009) show trends of an increased number of job

applicants seeking out companies that encourage employee input, growth, education,

and teamwork, beyond the traditional compensation/benefitpackages offered by

employers.

Local Studies

Basically, the job status of the Philippine civil servants is guaranteed by the

Security of Tenure Law (Republic Act No.6656). However, the civil service system’s lack

of competitive compensation packages (e.g. low salary) is seen to hinder career

development, lower performance ,and cause a high level of corruption (Mangahas and

Tiu Sonco, 2011). Over three decades, the new public management (NPM) paradigm

emphasizing government efficiency and effectiveness has influenced public HRM in the

Philippines (Domingo and Reyes 2011).

Guided by decentralized HRM (Mangahas and Tiu Sonco 2011), personnel

management in the country has developed reforms associated with the new public

management context aimed to improve training, downsize the number of public

20
employees, and enhance public values such as transparency, public integrity,

accountability, and efficiency (Civil Service Commission 2014a; Hodder 2014). In

addition, the CSC has adopted a number of HRM policies and practices in public sector

organizations. The Philippines is regarded as a highly matriarchal society (Caparas

2011) albeit in the private domestic domain. Women are not preferred in the workplace

and tend to maintain the conservative role that emphasizes family over work (Caparas

2010; Selmer and de Leon 2001). Notably, however, female public officials outnumber

their male counterparts, with women making up 60% of the total number of career public

officials (Civil Service Commission 2014a).

While academic research has not explored the Philippines much, it is regarded

as one of the most successful Asian countries in terms of WLBP implementation

(Central Intelligence Agency 2014). CSC has tried to reflect gender-sensitive contents

based on Gender and Development (GAD) policies in developing and implementing

HRM programs such as the Program to Institutionalized Meritocracy and Excellence in

Human Resource Management (PRIME-HRM). There have also been increasing efforts

to enhance public employees’ well-being, such as the Program on Awards and

Incentives for Service Excellence (PRAISE), the Employees’ Health and Wellness

Programs, including Employee Assistance Program (EAP), compensatory time-off and

flexiplace (Civil Service Commission 2014a, 2014b), and leave benefits under the Civil

Service laws and rules (Civil Service Commission 2014a).

In addition, reward and recognition performance indicators of Program to

Institutionalized Meritocracy and Excellence in Human Resource Management include

WLBPs as one of the components for strategic HRM. Overall, Philippine government

21
agencies offer the following WLBPs: flexitime, compensatory time-off, flexiplace,

childcare program, health and wellness program, life insurance benefits, health

insurance benefits, paid vacation leave, and paid sick leave. Overall, categories of

Philippine WLBPs are similar to those provided by the

US government agencies (Macusi 2015), 2 Comparing the WLBPs of the two

countries, we note that health and life insurance benefits, which are not components of

US WLBPs, are included as WLBPs in the Philippines by law (Republic Act No. 7875

1995; Republic Act No. 8291 1997). Among these WLBPs, flextime, compensatory time-

off, and flexiplace are implemented on a voluntary basis while the childcare program,

health and wellness program, life insurance benefits, health insurance benefits, paid

vacation leave, and paid sick leave are mandatory (e.g., Civil Service Commission

1995, 2010, 2014a, 2014b; Department of Labor and Employment 1989; Republic Act

No. 7875 1995; Republic Act No. 8291 1997; Republic Act No. 10028 2009).

Flexitime is a policy wherein employees can set the times when they start or

leave work, enhancing the flexibility of working hours. Compensatory time-off, in lieu of

overtime pay, is given to employees who work overtime and corresponds to the number

of hours ofovertimework(Bureau of Internal Revenue 2004). Flexiplaceis a “work

arrangement allowed for qualified employee/s who demonstrated responsibility,

initiative, and capacity to produce output/results and accomplishment outside of the

workplace subject to established guidelines” (Bureau of Internal Revenue 2004, p. 7).

Childcare program includes day care services provided by government agencies and a

breastfeeding center for the children of government officials (Fernandez 2003).

22
 The program also allows single parents to take additional leaves for their special

needs (Republic Act No. 8972 2000). Health and wellness programs, required for all

Philippine government agencies, refer to physical fitness activities/exercise programs to

maintain government employees’ healthy lifestyles (Civil Service Commission 1995).

Life insurance benefits are for government employees in the Executive Branch of

Government and include both retirement and life insurance benefits based on their

membership in the Government Service Insurance System (Republic Act No. 8291

1997). Health insurance benefits provided by the Philippine Health Insurance

Corporation are based on specific health insurance policies in which most regular

employees are enrolled (Republic Act No. 7875 1995). Paid vacation leaves referto

“leaveofabsence granted toofficialsandemployees forpersonal reasons,the approval

ofwhich iscontingent upon the necessities of the service” (Civil Service Commission

2010, p. 1), and lastly, paid sick leave refers to “leave of absence granted only on

account of sickness or disabilityon the part of the employee concerned or any member

of his family immediate family” (Civil Service Commission 2010, p. 1).

Gap Analysis

There are studies that are similar in nature with the study that the researchers

are conducting. Studies both aims to determine the different retention programs in

some companies to prevent employee turn-over and prolong their term of work.

Studies that are similar to the researchers study are (Targeted Employee Retention:

Performance-Based and Job-Related Differences in Reported Reasons for Staying By:

23
John P. Hausknecht, Julianne M. Roddaand Michael J. Howard) and(A Survey of

Factors that Influence Employee Retention in Manufacturing Firms in Nairobi by:

Njorge Sophia Wanjiru).

Theoretical and Conceptual Framework

This framework shows the inter-relatedness of Employee Retention Program of

Motor Trading Companies.

Independent Variable Dependent Variable

Retention Employee
Program Performance

Number of branches
Years in operation
Number of regular employees

Intervening Variable

Figure 1. Conceptual Framework

The conceptual framework shows the factor that affects the performance of an

employee. The independent variables are the retention program offered by Motor

Trading companies. The dependent variable is the employee performance. The

intervening variables are the number of branches of the company, the number of years

in operation, and the number of regular employees.

24
 Chapter III

RESEARCH METHODOLOGY

This chapter discusses the research methodology used in this study. It includes

preparation of the research design, respondents of the study, sampling techniques, data

gathering procedure, research instrument and statistical treatment.

Research Design

The researcher used the Descriptive method of research to describe the

Employee Retention Program of Motor Trading in Koronadal City.

It is a conceptual structure within which research is conducted; it

constitutes the blueprint for the collection, measurement and analysis of data.

Decisions regarding what, where, when, how much, by what means concerning

an inquiry or a research study constitute a research design (Kothari, 2010). It

details the procedures necessary for obtaining the information needed to structure or

solve research problems. Studies aimed at quantifying relationships are of two types:

descriptive and experimental. In a descriptive study, no attempt is made to change

behavior or conditions-things are measured as they are. While in an experimental

study measurements are taken followed by some sort of intervention, then

measurements are taken again to observe the effect of that manipulation (Malhotra&

Dash, 2011).

25
Respondents of the Study

The respondents of this study were the managers and employees of Motor

Trade, MUTI Corporation, Honda Socsargen Inc., Trumph Motorcycle Corporation. The

respondents selected all the managers and employees of chosen enterprise in

Koronadal City. The researchers used simple random sampling techniques.

Research Instrument

The researchers used questionnaire to gather information from the different

Motor Trading Companies in Koronadal City.

The researchers used the scaling method in questionnaire that shows below.

1-Strongly Agree

2-Agree

3-Neutral

4-Disagree

5-Strongly Disagree

26
Locale of the Study

The study was conducted at Motor Trade located at Gen. Santos Drive, Zone III,

MUTI Corporation located at Casa Subd. Zone III, Zone II, Honda Socsargen Inc.

located at Gen. Santos Drive, Zone II, Trumph Motorcycle Corporation located at Gen.

Santos Drive, Zone II.s

Figure 2. Map of Korondal City

Sampling Size and Sampling Techniques

Using Lwanga Formula the research computed the sample size, the total

population is 70 with marginal error of 5%, and the total sample size was 43. The

researchers have chosen the simple random sampling technique.

𝒂
𝒁𝟐𝟏 − 𝑷(𝟏−𝑷)
𝟐
Formula: n =
𝒅𝟐

27
z= confidence level (90% = 1.645)

p= anticipated population proportion 70

d= absolute precision 10%

Substituting the values, the sample size was

𝑎
𝑍 21 − 2 𝑃(1 − 𝑃)
𝑛=
𝑑2

(1.645)2 (0.20)(1 − 0.20)

𝑛=
(0.10)2

2.706025 (0.16)
𝑛=
0.01

n = 0.432964

n= 43.2964 or 43

The 43 employees including the managers of Motor Trading Companies were

distributed proportionately from each company.

Motortrading Companies Population Sample Size

Motortrade 12 8

MUTI 21 13

TRUMPH 17 10

HONDA SOCKSARGEN 20 12

Total Population 70 43

28
Data Collection Procedures

The researchers utilized questionnaire in gathering data. First, the researchers

send a letter asking permission to the office of the managers Motor Trade, MUTI

Corporation, Honda Socsargen Inc., Trumph Motorcycle Corporation. Next, the

researchers proceed to the respondents upon approval of the concerned personnel for

distribution of questionnaire. Lastly, the researchers will consolidate the answered

questionnaire from the respondents for analysis and interpretation of data using Lwanga

Formula.

Statistical Treatment

The frequency and percentage distribution are used to compute the respondent’s

demographic characteristic. This was also used to determine the Retention Program

that is given to employees. The formula shows below:

𝑓
p = 𝑛* 100

Where;

𝑝 = 𝑝𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒
𝑓 = 𝑓𝑟𝑒𝑞𝑢𝑒𝑛𝑐𝑦
𝑛 = 𝑡𝑜𝑡𝑎𝑙𝑛𝑢𝑚𝑏𝑒𝑟𝑜𝑓𝑟𝑒𝑠𝑝𝑜𝑛𝑑𝑒𝑛𝑡𝑠

29
 The scale below indicates the :

Weighted Scale Verbal

Mean Interpretation

4.21-5.00 5 Strongly
Disagree

3.41-4.20 4 Disagree

2.61-3.40 3 Neutral

1.61-2.60 2 Agree

1.00-1.60 1 Strongly Agree

30
 CHAPTER IV

PRESENTATION, ANALYSIS AND INTERPRETATION OF DATA

This chapter presents the analysis and interprets the data gathered the study.

Table 1: Profile of the Motor Trading companies in Koronadal City

Managerial Profile
Sequence Frequency Percentage
1 Age
20-30
31-40 2 50%
41-50
51-60 2 50%
2 Branches
Yes 2 50%
No 2 50%
3 Years of Operation
1-3 years
4-6 years
7-10 years 2 50%
11-15 years
16- above 2 50%
4 Regular Employees
5 to 10
11 to 15 1 25%
16 to 20 2 50%
21 to 25 1 25%
26 to 25

Table 1 indicates the profile of the Motor Trading Companies in Koronadal City.

31
 a.) with respect to the age, the table shows that most of the managers age
between 31-40 years old with 50% or 2 respondents and also ages 51-60 years old with
50% or 2 respondents.

b.) with respect to the number of branches, the table shows that most of the
Motor Trading companies has branches for 50% with 2 respondents and also 50% has
no branches with 2 respondents. MUTI has two branches in Koronadal City and Motor
trade also have 2 branches in Korondal City.

c.) with respect to the years of operation, the table shows that Motor Trading
companies operates between 7 to 10 years with 2 respondents or 50% and also 50%
and also 50% or 2 respondents range to 16 above years in operation.

d.) with respect to the number of regular employees, the table shows that 50%
has 16 to 20 regular employees with 2 respondents. Next is 11 to 15 regular employees
with 25% or 1 respondent and also 25% for 1 respondent range to 21 to 25 regular
employees.

Accroding to Gunnigleet, al. (2011) exploring the motivation of individual

employee’s satisfaction they found the following factors influence employees’
motivation: personal characteristics: values, attitudes, etc. biographical profile (sex, age,
background),Job: intrinsic and extrinsic outcomes (nature of job, responsibilities, etc.)
and work environment: organizational climate and personnel policies (work design,
supervisory style, social relation) .

32
 Table 2: Retention Program given by the Motor Trading Company in Koronadal
City.

Retention Program Frequency Percentage (%)

•Compensation Incentives 3 75%
Bonuses
•Reward Incentives 3 75%
Service Reward
•Monetary Reward 2 50%
•Gift Certificate 2 50%
•Appreciation Incentives 3 75%
company Parties
•Paid Group Lunches 2 50%
•Health Benefits Dental 4 100%
Benefits
Medical Benefits 4 100%
Sick Leave 4 100%
•Insurance Benefits
SSS 4 100%
PhilHealth 4 100%
PAG-IBIG 4 100%

The table show the percentage of retention program given by Motor Trading
Companies, most of them have dental, medical, sick leave and insurance benefits which
are SSS, PAG-IBIG and PhilHealth which is 100%, while 75% of them have bonuses,
service reward and company parties and lastly monetary reward, gift certificate and paid
group lunches with 50%.

According to Kavitha et al.(2011) they indicated that there are six main ways to
retain employees, and these are communication, recruiting, pay, benefits, training and
job satisfaction. They also recommended that management should strategically plan
towards employee needs with specific retention programs. McNally (2011) found some
ways of retaining valued employees, such as designing a compensationprogramme to
reward valued employees, career opportunity, development and growth paths they need
to develop, encouraging work-life balance and good communication.

33
Table 3: Demographic Characteristic of Employees

Employees Profile
Sequence Frequency Percentage
1 Age
20-30 28 71.79%
31-40 6 15.38%
41-50 5 12.82%
51-60
2 Gender
Male 16 41.03%
Female 23 58.97%
3 Status
Single 20 51.28%
Married 19 48.72%
Widow

Table 3: Shows the Demographic characteristic of Employees in Koronadal City

a.) with respect to the age, the table above indicates that the majority of the
respondents age is between 20-30 with 71.79% or 39 respondents, then 31-40 with
15.38% or 6 respondents, next comes 41-50 with 5 respondents.

b.) with respect to the gender, the table shows that most of the employees in
Motor Trading Companies in Koronadal City are female with 23 respondents or 58.97%
and 16 respondents for male with 41.03%.

c.) with respect to initial status, the table shows that a lot of the employees in
Motor Trading Companies are single with the respondents of 20 or 51.28% and the next
is married with the total respondents of 19 or 48.72%.

Accroding to Gunnigleet, al. (2011) exploring the motivation of individual

employee’s satisfaction they found the following factors influence employees’
motivation: personal characteristics: values, attitudes, etc. biographical profile (sex, age,
background) ,Job: intrinsic and extrinsic outcomes (nature of job, responsibilities, etc.)
and work environment: organizational climate and personnel policies (work design,
supervisory style, social relation).

34
 Table 4: Effects of Retention Program of Motor Trading Companies to their
employees.

Questions Mean Scale

1. Do financial incentives increase employee work 1.79 Agree
productivity?
2. Do financial rewards increase employee job 2.18 Agree
satisfaction?
3. Do incentives develops employee attitude toward the 2.28 Agree
company goals and objectives?
4. Do incentives increases employee loyalty toward the 1.82 Agree
company?
5. Are those motivated employees are real asset of an 1.82 Agree
organization?
6. Is money is enough to motivate employee? 2.23 Agree
7. Is work recognition motivates employee satisfaction? 1.97 Agree
8. Is the working environment important in order to 1.90 Agree
motivate employees?
9. Does relevant need satisfaction leads to high 1.95 Agree
motivaton?
10. Do motivated employees are effective in their 2.00 Agree
functioning?

Table 4 indicates that most of the employees are agree with mean ranging 1.61-
2.60 to the retention program given by the Motor Trading Companies. It shows that
retention programs like giving incentives and rewards motivates employee satisfaction
the organization.

According to (Kukano, 2011) job satisfaction improves employee retention. Job

satisfaction is reliable and relevant predictor of employee retention. When employers
engage in practices that support good working relationships and benefits job satisfaction
improves because workers tend to believe that the company is using their skills and
appreciating their service and commitment.

35
 Table 5: Effect of Retention Programs of Motor Trading Companies to their
employees.

Questions Mean Scale

1. I am quite reliable and regular at work with great 1.72 Agree
attendance track record.
2. I want to stay in this company because there is career 2.28 Agree
advancement for me.
3. I want to stay in this company because there are 2.00 Agree
retirement benefits.
4. I want to stay in this company because there would be 2.41 Agree
a salary increase upon regularization.
5. I want to stay in this company because the job 2.13 Agree
description matches my skills, experience and education.
6. I try and maintain great client relationship through 1.90 Agree
effective communication techniques which are one of my
core strengths as well.
7. I am satisfied with the salary that I receive from work. 2.26 Agree
8. I am satisfied with the benefits that I receive from work 1.92 Agree
(Health Insurance, vacation, and sick leaves).
9. I am paid fairly with the work I contribute to my 2.13 Agree
company
10. I am satisfied at work because there are 2.15 Agree
bonuses/rewards given for excellent performance.

Table 5 shows that most of the employees are agree the retention program really
affects to their work performance with a mean ranging 1.61-2.60. It means that because
of satisfactory retention programs which are giving benefits and incentives given by
Motor Trading Companies, it motivate employees to do their job and make positive
output to the company goals.

According to (Romana, 2014) giving performance based on bonuses allows

worker to see their growth in a tangible manner and gives the employee something to
aspire every year. The employees found out to be motivated by position, recognition,
rewarded for their achievement, able to attain personal growth and having interesting
and challenging work. The hygiene factors of their job also made them motivated for
they were able to have proper remuneration and benefits, good working conditions, job
security, good relationship, with colleagues and good organizational values and policies.

36
 Table 6: Problems encountered by employees related to retention program

Questions Mean Scale

1. Do you think breakdown in communication of feedback 1.74 Agree
process is important?
2. Is workload overload cloud lead to discrimination? 2.59 Agree
3. Do you think reasonable strict supervisor is good? 1.77 Agree
4. Do you think favoritism in the workplace exist? 2.05 Agree
5. Do you believe that unpaid or underpaid allowances, 1.90 Agree
benefits and overtime is normal?

Table 6 shows that employees agree that communication is important in the

workplace with the mean ranging 1.61-2.60 and most of the employees agree that
overload workload could lead to discrimination with the mean ranging 1.61-2.60.
Employees agree that reasonable strict supervisor is good and employee’s agree that
favouritism in the workplace exist and unpaid allowances are normal with the mean
ranging 1.61-2.60. It means that even if employees encountered different problems in
the workplace it cannot affect to their decision in staying in the company.

According to (Angela, et.al., 2008) the need to focus on the factors that affects
retention leading to growth and success of organization.Pilbeam and Corbridge (2010)
outlined that to identify the reasons why people leave is of assistance in being able to
fully understand the retention issues in organisations. According to (Wels &Thelen,
2002) that organizations which have generous human resource policies have a very
good chance to satisfy and retain employees by providing them an appropriate level of
privacy and sound control on work environment which enhances the motivation level to
commit with the organization for the long-term.

37
 CHAPTER V

SUMMARY, FINDINGS, CONCLUSIONS AND RECOMMENDATION

This chapter presents the summary of the study, findings on the results,
conclusions and recommendation.

Summary

This study attempted to determine the effect of Employee Retention Program of

Motor Trading Companies in Koronadal City.

1. What is the profile of the Motor Trading Companies in terms of:

 Number of Branches
 Years in operation
 Number of regular employees

2. What are the retention programs given by the Motor Trading Companies to their
employees?

3. What are the effects of retention program of Motor Trading Companies to their
employees?

4. What are the problems encountered related to retention program?

The study utilized the descriptive method of research. This was administered to
39 employees and 4 managers of Motor Trading Companies. The data were collected
through administering the questionnaires to the employees and managers.

To determine the profile of Motor Trading Companies, specifically, their

branches, years in operation and number of regular employees.

To determine the Employee Retention Program given by the Motor Trading

Companies.

38
Findings

Based on the results of the study, the following were the findings.

1. The profile shows that 50% of the Motor Trading Companies has branches and also
50% have no branches. In year of operation most of the companies operate between 7
to 10 years which corresponds to 50% and also 50% operates 16 years above. The
profile also shows that 50% or 2 companies have 16 to 20 regular employees, 25% or 1
company has 11 to 15 regular employees, and 25% also 1 company has 21 to 25
regular employees.

2. The employee program given by Motor Trading Companies are dental, medical, sick
leave and insurance benefits which are SSS, PAG-IBIG, and PHILHEALTH which is
100% bonuses, service reward and company parties with 75%, and lastly, monetary
reward, gift certificate and paid group branches with 50%.

3. The respondents agree with the mean ranging from 1.61-2.60. It shows that
employee retention program given by the Motor Trading Companies motivates
employees to do their job with good performance and outputs.

Conclusions

Based on the findings, the following conclusions were made:

1. They have a great set of retention program that motivates employee to have a good
job performance.

2. The employee retention program are set by the company’s policy and not based on
the long years of operations.

3. The more the company set a great retention program to the employees, the more
they will have good output.

4. Employees considering each of the retention programs given by the company

important, it makes them feel valued and welcome with the working environment.

39
5. Employees are not affected with the problems they encountered in terms of retention
program; instead it serves as their strength in staying in the company.

Recommendation

Based on the findings of the study, the following recommendations were

formulated:

1. The company should give benefits and bonus that their employees deserves in order
for them to increase their performance.

2. Employees should give their best to receive what retention program they deserved.

3. Managers should treat their employees well to avoid employee turnover.

4. Retention program should be enhanced to boost employee performance.

5. Employees should maintain their good outputs in work.

40
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