A Real-world Exploration in Jordanian Banks

 

Navigating Employee Retention Challenges: A Real-world Exploration in Jordanian Banks

Introduction:

The banking sector in Jordan is grappling with a pressing issue – a surge in employee turnover. This study aims to unravel the intricacies of this challenge by delving into the impact of Human Resource Management (HRM) practices on employees' turnover intention. Drawing insights from real-world examples, including the experiences of 394 employees across 25 banks in Jordan, the research investigates the role of compensation, performance appraisal, promotion, and training & development. Additionally, it explores the mediating role of career satisfaction in these relationships.

1. Setting the Stage:

In the fast-paced and competitive landscape of Jordanian banks, the demand for innovation and excellence is incessant. However, a concerning trend has emerged – a significant increase in employee departures. The study takes a closer look at how existing HRM practices, such as compensation systems, appraisal procedures, and promotion strategies, are faring in meeting employee needs and aspirations.

2. Unpacking the Cost of Turnover Intention:

Beyond the local context, employee turnover intention carries profound implications for organizational performance. High turnover intention generates stress, impedes employee loyalty, and imposes substantial costs on attracting and training new hires. The unique challenge in Jordanian banks is the potential loss of skills and work procedures when experienced employees leave, posing a significant threat to organizational continuity.

3. Examining HRM Practices in Action:

The research dives into the daily workings of four critical HRM practices – compensation, performance appraisal, promotion, and training & development. By utilizing Partial Least Squares Structural Equation Modeling (PLS-SEM) and incorporating real-world examples, the study aims to provide tangible insights into how these practices influence employees' turnover intention.

4. Lessons from the Real World:

The study unveils noteworthy results, grounded in the experiences of Jordanian banking professionals. HRM practices, particularly compensation, performance appraisal, promotion, and training & development, exhibit a tangible impact on employees' turnover intention. The incorporation of real-world examples adds a layer of authenticity to the findings, making them relatable and actionable for banking industry professionals.

5. Translating Insights into Strategy:

Based on the findings, the study proposes strategic recommendations tailored to the Jordanian banking context. These include the imperative for high compensation, fair performance appraisal, rapid promotion systems, robust training & development programs, and elevated career satisfaction. These strategies, drawn from real-world experiences, aim to retain the crucial human capital that drives the banking business.

6. Elevating the Role of Career Satisfaction:

Career satisfaction emerges as a central theme, acting as a pivotal variable influencing the relationship between HRM practices and turnover intention. Drawing from real-world scenarios, the study emphasizes the importance of ensuring employees are satisfied not just with their jobs but with the trajectory of their careers within the organization.

7. Real-world Applications and Future Research:

The study's real-world approach opens avenues for practical applications in addressing employee turnover. By learning from the experiences of Jordanian banks, organizations globally can adapt and implement strategies to enhance employee retention. Future research directions include exploring additional variables and expanding the scope of real-world examples for a comprehensive understanding.

As Jordanian banks grapple with the challenge of employee turnover, this research offers not just theoretical insights but practical strategies rooted in real-world experiences. By aligning HRM practices with employee needs and incorporating tangible examples, organizations can navigate this crisis and ensure the longevity of their human capital.

References:

- Rowland, K., et al. (2017). Dynamics of the Banking Sector: Challenges and Opportunities.

- Suifan, T. S., & Al-Janini, E. M. (2017). Employee Readiness for Change: Scale Validation and the Role of Human Resource Management Practices.

- Association of Jordanian Banks. (2017). Annual Report.

- Madanat, H., & Khasawneh, S. (2018). Human Resource Management Practices and Employee Performance in the Jordanian Hotel Sector.

- Al-Abdullat, B., & Dababneh, M. (2018). The Impact of Human Resource Management Practices on Organizational Commitment: A Field Study in Jordan.

- Kasasbeh, M. (2018). Employee Turnover and Retention Strategies in Jordanian Commercial Banks.

- Locke, E. A. (1976). The Nature and Causes of Job Satisfaction.