Running Head: STRATEGIC HRM AND ITS IMPACT ON TURNOVER 1

Strategic Human Resource

Management and Its Impact on Turnover
Tammy Hardin & Robin Morgan
Louisiana State University
LHRD 7900

Abstract
STRATEGIC HRM AND ITS IMPACT ON TURNOVER 2

This study addresses the potential challenges that high employee turnover rates create in

manufacturing organizations and the potential impact of using strategic human resource

management to reduce those rates. The effect of turnover in any organization is significant in

terms of human capital and the organization’s bottom line. The purpose of this study is to

explore what blue-collar workers value in their jobs and how those values impact turnover rates

in the manufacturing industry. To do this, we will identify the causes and impacts of high

turnover and best practices of current strategic human resource management (SHRM) in

reducing turnover rates. In our research, qualitative data will be gathered through structured

interviews to determine what blue-collar employee’s value that makes them remain at their jobs.

We will use the grounded theory approach to provide a comparative analysis, revealing the

effects of current SHRM policies on blue-collar worker retention. The data collected will allow

comparisons of relationships of the following themes: organizational values versus employee

values, differences in generational work values, and current SHRM practices versus potential

future retention practices. This study intends to add to the current body of literature to assist

organizations in retaining top blue collar talent in the manufacturing industry.

Keywords: turnover, strategic human resource management, values, blue-collar,

generations

Introduction
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In today’s competitive job market, retaining talent in organizations has become more

challenging and more important than ever. Organizations are constantly dealing with the

difficulties of retaining employees and reducing turnover rates. Retention may be especially

difficult with blue-collar skilled labor workers, as the level of education required is much

different today than it was in past generations along with a booming job market competing for

such workers. Much research has been conducted on the causes of turnover, such as

dissatisfaction with supervisor relationships, job content, working conditions and environment,

and pay (Tracey & Hinkin, 2008; Flowers & Hughes, 1973; Maertz & Griffeth, 2004). Beyond

that, past and current research has identified how turnover impacts an organization, such as

consistency and quality of customer service and products, hard and soft staffing costs, missed

opportunity costs, additional training costs, organizational memory, loss of productivity, work

disruptions, and organizational morale (Bryant & Allen, 2013). All of these things lead to a

reduction in an organization’s bottom line.

Understanding an employee’s rationale for leaving an organization is fundamental to

strategic human resource management initiatives in reducing the turnover of its employees.

Often, decisions to hire a particular person are based on organizational needs and values. Also,

research has indicated that an influential factor on an employee’s decision to leave is based on

organizational commitments and their values (Mendelson, Turner, & Barling, 2011; Maertz &

Griffeth, 2004). With several generations in the current workforce, human resource managers

must understand the workers’ values in order to address retention problems and strategically

reduce the impact to the organization. Hence, identifying discrepancies between a diverse blue-

collar workforce and organizational values will assist SHRM practitioners in developing
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initiatives and policies that support diverse employee values. As such, this study will assist

manufacturing organizations in retaining top talent in their respective workforces.

Statement of the Problem

According to Lee, Hom, Eberly, and Li (2018), 46% of strategic human resource

managers, in 2016, identified turnover as its biggest concern, an increase of 11% in just over

three years (p. 88). The cost to replace a worker comes not only with a direct financial impact on

the organization but also brings cultural costs to it as well. Financially, there is a cost to recruit,

onboard, and train a new employees, which can impact organizational performance and product

quality. The estimated cost of an employee turnover can be in excess of 100% of the annual

salary of the vacant position (Bryant & Allen, 2013, p.171). Culturally, the voluntary loss of an

employee can reduce workforce diversity, demoralize remaining workers, and inspire others to

leave (Lee et al., 2018). Because of these impacts, organizations looking to compete in a global

market are seeking ways to retain their human capital assets as a means of protecting itself.

Despite the research into employee motivation and retention, the current job market

shows that employee retention remains problematic. Smola and Sutton (2002) found that, while

repeating a study by Cherrington (1975), generational differences existed between Baby

Boomers and GenXers. However, today’s workforce is comprised mostly of three generations

and their study is cross-sectional of the entire workforce. More than 51% of today’s workforce

report that they are actively seeking a new job or monitoring job openings (State of the American

Workplace, p. 4). Millennials comprise 38% of the current workforce, and sixty percent of them

report, in a 2016 Gallup poll, that they are open to other job opportunities, a 15% higher rate than

the other generations in the workforce (How Millennials Want to Work and Live, p. 20).

Additionally, 55% report that they currently feel unattached to their jobs, which negatively
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impacts performance and prevents organizations from reaching their full potential in profits and

growth (p. 12). Perhaps millennials’ views and values about work plays an important role in

how they view their organization and affects their willingness to stay. Westerman and

Yamamura (2007) relate generational characteristics as being related to life experiences of each

generation with respect to what generation’s value in their workplace. Though millennials

comprise a majority of the labor force, two other working generations, GenXers and Baby

Boomers, whose values and life experiences differ, round out roughly 93% of the total workforce

with approximately 33% and 25% participation respectively (Fry, 2018). Today, unemployment

rates are near historic lows, with a rate of 3.5%, which means industries are increasingly vying

for human assets and seeking ways to retain them through strategic human resource management

initiatives (Amadeo, 2020).

Although studies on work environment fit, generational differences, retention, and values

exist in the current body of literature, none have focused their studies specifically on blue collar

workers in the manufacturing sector and their retention practices, where worker requirements for

employment have changed greatly due to technological advances (Westerman & Yamamura,

2007; Twenge, Campbell, Hoffman, & Lance, 2010; Brouwer and Veldkamp, 2018). Instead,

many of the studies center on white-collar professionals in varying industries. Ryan Naylor,

CEO of LocalWork.io, said, “We are driven by thoughts and beliefs, and this is the greatest

predictor of how someone will move in his or her career path……and beliefs and values will

drive his (or her) behavior” (Gulati, 2016, par. 2-3). These thoughts and beliefs constitute

workplace values and play a significant role in an employee’s decision as to whether he or she

will remain with an organization for a prolonged period of time. Wilkie (2019) purports that

there is a “frightening shortage of workers, who have traditionally been the economic foundation
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of this country—be they builders, welders, plumbers, pipe fitters, miners or mechanics,” all

considered blue-collar employees (par. 3). Blue-collar workers today look different in terms of

education than they did twenty years ago. Today, blue-collar related work “may involve skilled

or unskilled labor requiring an associate degree or less” but generally more than a high school

degree (par. 6). With fewer than one percent of companies offering apprenticeship programs,

and the increased demand for skilled labor due to advances in technology, a skill gap exists that

could create a labor shortage of as many as 2.4 million unfilled manufacturing jobs by 2028

(Wilkie, 2018). As such, this study will contribute to the understanding of blue-collar

manufacturing employees with consideration to generational value differences of the workforce

and assist human resource managers within organizations to develop strategic practices to meet

potentially unique values of blue-collar manufacturing workers.

Pfeffer (1998) identifies seven dimensions of human resource management that increase

economic performances in for-profit organizations. These dimensions include the following

practices:

 Employment security

 Selective hiring of employees

 Self-managed teams in an organizational design

 High compensation based on organizational performance

 Extensive training

 Reduced distinctions in status

 Extensive sharing of financial and performance information (Peffer, 1988, p. 96).

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He contends that these dimensions impact the effectiveness, and thus the performance of,

the organization. With respect to the importance of selective hiring, Pfeffer notes, “the degree of

cultural fit and value congruence between job applicants and their organizations significantly

predicts subsequent turnover and job performance” (Pfeffer, p.103). However, De Vos and

Meganck (2009), in their study of 100 of Belgium’s private and public organizations, address

discrepancies between human retention management and employee values. Their survey of

human resource managers revealed that managers focused their practices on what they believed

would retain employees. Sixty-four percent of managers believed employees leave for financial

reasons, whereas employees reported that social atmosphere, job content, development

opportunities, and work balance were more important than financial rewards (pp. 50-54).

Though Pfeffer (1998) offers “best practices” for optimal organization performances, De Vos

and Meganck’s (2009) study highlights gaps between management and employee in terms of

employee values. As such, manufacturing industries, in adopting best practices, should

understand the value system of its employees in order to recruit and retain them.

Considering the continued growth of the blue-collar workforce and its twenty-first

century knowledge requirements, the potential value caused by generational differences, and

current S-HRM practices, this research intends to explore the following areas:

 Identifying blue-collar work values in the manufacturing industry

 Identifying potential value differences among generations in blue-collar workers

within the manufacturing industry

 Identifying current SHRM best practices and proposing potential impacting

practices in blue-collar industries.

STRATEGIC HRM AND ITS IMPACT ON TURNOVER 8

Purpose of the Study

The purpose of this study is to explore what blue-collar workers in manufacturing

environments value in their jobs and what makes them decide to stay or leave their employment.

We will also explore how employee turnover impacts organizations and how to minimize the

loss using strategic human resource management practices. Employee turnover is recognized as

costly and disruptive, so this study will specifically delve into voluntary turnover in a

manufacturing environment to identify causal value relationship differences between

organizations and employees using a systems value perspective. Frieze, Olson, Murrell, and

Selvan (2006) state that work values “relate to what people want most in their work” (p. 83). By

studying the causal relationship differences, this study will contribute to the current literature on

turnover in various manufacturing industries. Qualitative data will be collected using a grounded

theory approach by means of systematic inductive method to discover an emerging theory of

blue-collar work values in manufacturing. Utilizing a grounded theory approach allows for a

constant comparative analysis, to identify causal relationships of turnover, as it relates to work

values of the individual and the organization of blue-collar employees in a manufacturing setting.

Research questions

The central question that we will address in this study is as follows:

What do blue-collar employee’s value in their jobs that make them stay or leave their

organizations?

The following are guiding research questions that will shape the study:

 How does turnover impact a manufacturing organization in a tight job market:

financial and non-financial impacts?

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 What do blue-collar employees value in their jobs?

 What do they enjoy most and least?

 How do their relationships with managers and supervisors affect their

desire to stay with the organization?

 What internal and external factors, or forces, might make them leave their

organization?

 What do HR managers think about an employee's value?

 Are the causes for turnover different between different generations?

 Do millennials, genXers, and baby boomer’s value different things?

 What is strategic human resource management?

 How do the current best practices address employee values?

 How does SHRM impact turnover?

 What other practices might SHRM consider in an effort to retain human

assets in the manufacturing industry?

Procedures

Role of Researcher

Creswell and Creswell (2018) note that researchers interpret findings through their own

lens as their interpretations are “shaped by the researcher’s own experiences and background” (p.

8). Furthermore, characteristics and experiences of a generation may influence work value

decisions (Smola & Sutton, 2002). Robin Morgan, a GenXer, holds a certification from the

Society for Human Resource Management and works as a director of human resources. She has
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experience in exit interviews, thus has background knowledge from her experiences with reasons

people leave jobs, including work value reasons. She has worked in predominantly male

manufacturing industries throughout her career. Due to her previous experiences, she

understands that she may hold preconceived biases. Robin will employ cautionary measures to

ensure objectivity in the interviewing process and during data analysis. She understands that

employee work values are a belief and thought process based on upbringing and experiences,

which is distinctive to each worker. Robin believes her role as a researcher is to be respectful of

everyone’s work values.

Tammy, a GenXer, is a former teacher who is new to the field of human resources study

and has no experience in the manufacturing industry. However, she grew up in a blue-collar

family during a time when unemployment rates were high compared to today’s job market. Her

experiences and work values may be in conflict with other generations. Tammy will make every

effort to ensure objectivity, realizing that the knowledge demands for today’s blue-collar workers

differ from her father’s experience in the oil field industry some 35 years ago.

Data Collection Procedures and Data Analysis Procedures

In this qualitative study, literature research and interviews are the main tools for data

collection. We will satisfy this role by collecting data from existing literature and conducting

interviews of blue-collar workers in manufacturing environments. Using an inductive method,

we will develop a theory of blue-collar values that affect turnover in manufacturing

environments.

Prior to collecting data, cover letters containing information about the study, along with

participant rights, will be distributed during an informational session with potential participants

at each manufacturing location (See Appendices A). Following the information session and a
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review of potential participant commitments, we expect to conduct at least 30 interviews to

achieve a desired saturation of data amongst the expected three generations in the manufacturing

workforce. Interview criteria includes a reflection age diversity, job diversity, tenure, and

employee availability. Any follow-up interviews will occur as needed for clarification purposes.

Each interview is anticipated to take one hour. They will be informal, with structured open-ended

and probing questions. We will use audio recordings and journal entries to document the

responses. Interviews will be transcribed verbatim. In addition, the employee manual and

company policies will be reviewed and analyzed, with a focus on revealing organizational

values, and to assist with constructing interview questions.

During data analysis, the following steps will take place: open coding, constant

comparative analysis, and research memoing. During open coding, key phrases will be marked

and given an identifying code. A redundancy review of codes will follow this step. In the

second step, axial coding will be used to identify core themes in order to identify causal

relationships in blue-collar employee value turnover. The developing themes will be turned into

categories to be used in an emerging theory. Using a constructivist perspective, coding, and a

constant comparison analysis of data collected, will be used by the researchers to develop a

theory that describes blue-collar work values of the participants as it relates to turnover

phenomenon.

Qualtrics Suite, a research platform used by thousands of schools, will be used to aid the

process of analysis. This flexible program contains survey design, Text IQ feature and a Driver

IQ feature that provides for real-time data. Relevant codes to employee value will be used to

develop themes at least 5 common themes that will develop into a theoretical model.
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Strategies for Validating Findings

To ensure consistency, researchers will take certain precautions. During the coding

process, researchers will keep a journal containing reflexive notes to identify potential bias that

could threaten research findings, documentation of interview answers, and other relevant notes.

During open coding and axial coding, researchers must agree that a coding consensus will be

necessary to ensure appropriate placement of data. Researchers will also create memos during

the coding process and continually evaluate codes to prevent coding drift.

To ensure the trustworthiness of findings, several measures will be employed to ensure

accuracy of the research and findings. The first will be the triangulation of data sources

(interviews, current literature and theories, and a review of the employment manual and policies)

to justify developed themes. Next, the themes, findings, and theory developed from the study

will be presented to available study participants, allowing them to comment on the findings

either verbally or through a written note. A review of their comments will be held by the

researchers to see if any additional interviews need to take place prior to a review by an external

audition. As a final measure, an external auditor who is experienced in qualitative research and

unfamiliar with this research will review all aspects of the project.

Anticipation Ethical Issues

The researcher’s roles in this study are to evaluate data and develop a theory based from

various sources, including participants using face-to-face interviews. Therefore, this proposal

will occur to ensure necessary measures meet, or exceed, research standards prior to conducting

the study. To ensure confidentiality, researchers will obtain consent forms from participants at

the onset of the study, which will serve to notify them of the voluntary nature and objectives of
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the study, confidentiality measures, the defined roles of participants and researchers.

Participants will also be given the choice of anonymity while taking part in the study.

Participants will be given the opportunity to verify, or clarify, themes, findings, and emerging

theory during a voluntary follow-up on the findings. Additionally, researchers will present all

findings, including deviant or negative cases, in submissions of the study.

Expected Impact or Significance of Study

Though current literature exists on employee values, cultural fit, and job satisfaction, the

existing literature has not focused on blue-collar employees, specifically in the manufacturing

sector. This study intends to add to the current body of literature by surveying and interviewing

blue-collar, manufacturing workers to gain insight into their work values and decisions to remain

with or leave an organization based on those values. By doing so, this research will enhance

current SHRM practices in blue-collar industries in order to incorporate potentially diverse blue-

collar work values into their level of service to employees in an effort to reduce turnover in an

anticipated growing workforce.

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References

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3305506

Brouwer, A. J., & Veldkamp, B. P. (2018). How age affects the relation between personality
facets and work values of business and private bankers. Journal of Work and
Organizational Psychology, 34(3), 181–193. https://doi-
org.libezp.lib.lsu.edu/10.5093/jwop2018a20

Bryant, P.C. & Allen, D.G. (2013). Compensation, benefits, and employee turnover: HR
strategies for retaining top talent. Compensation & Benefits review, 45(3), 171-175.

Creswell, J. W., & Creswell, J. D. (2018). Research design: qualitative, quantitative, and mixed
methods approaches (5th ed.). Los Angeles, CA: SAGE.

De Vos, A. and Meganck, A. (2009). What HR managers do versus what employees value:
Exploring both parties' views on retention management from a psychological contract
perspective. Personnel Review, 38 (1), 45-60.
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Flowers, V. S., & Hughes, C. L. (1973). Why employees Stay. Harvard Business Review, 51(4),
49–60.

Frieze, I. H., Olson, J. E., Murrell, A. J., & Selvan, M. S. (2006). Work Values and their effect
on work behavior and work outcomes in female and male managers. Sex Roles, 54(1–
2), 83–93. https://doi-org.libezp.lib.lsu.edu/10.1007/s11199-006-8871-z

Fry, R. (2018, April 11). Millennials are the largest generation in the U.S. labor force. FactTank.
Retrieved February 9, 2020 from
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labor-force/

Gallup (2016). How millennials want to work and live. [Survey Report]. Gallup Inc.
[Distributor]. Retrieved from https://www.gallup.com/workplace/238073/millennials-
work-live.aspx

Gallup (2017). State of the American workplace. [Survey Report]. Gallup Inc. [Distributor].
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479f396df1294a529c79107a6bba6234&elq=f044661c5ae744529036ec3c458b132d&elqa
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Gulati, A. (2016, May 18). Is values-based hiring right for your business? Retrieved January 25,
2020 from
https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/values-based-
hiring-culture-fit.aspx

Lee, T. W., Hom, P., Eberly, M., & Li, J. (2018). Managing employee retention and
turnover with 21st century ideas. Organizational Dynamics, 47(2), 88–98.
https://doi-org.libezp.lib.lsu.edu/10.1016/j.orgdyn.2017.08.004

Maertz, C. P., & Griffeth, R. W. (2004). Eight motivational forces and voluntary turnover: A
theoretical synthesis with implications for research. Journal of Management, 30(5), 667–
683. https://doi.org/10.1016/j.jm.2004.04.001

Mendelson, M. B., Turner, N., & Barling, J. (2011). Perceptions of the presence and
effectiveness of high involvement work systems and their relationship to employee
attitudes: A test of competing models. Personnel Review, 40(1), 45–69. https://doi-
org.libezp.lib.lsu.edu/10.1108/00483481111095519

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40(2), 96. https://doi-org.libezp.lib.lsu.edu/10.2307/41165935

Smola, K. & Sutton, C. (2002). Generational differences: Revisiting generational work values for
the new millennium. Journal of Organizational Behavior, 23(4), 363.
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Tracey, J.B. & Hinkin, T.R. (2008). Contextual factors and cost profiles associated with
employee turnover. Cornell Hospitality Quarterly, 49, 12-27.

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differences in work values: Leisure and extrinsic values increasing, social and intrinsic
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org.libezp.lib.lsu.edu/10.1177/0149206309352246

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STRATEGIC HRM AND ITS IMPACT ON TURNOVER 16

Appendix A
Cover Letter and Informed Consent
February 15, 2020
Dear Participant:
You are invited to participate in a research study that will explore blue-collar work values in a
manufacturing setting. You have the option to participate or opt out. You have been chosen to
participate because of your skill level and the industry for which you work. Again, participation
in this study is completely voluntary.
The following information is provided for you to make an informed decision as to whether you
wish to participate or not. As I read the information to you, please follow along and ask any
questions that come to mind. I will do my best to answer each question to the best of my ability.
Project: Studying blue-collar (skilled) work values and its impact on retention and SHRM
future practices and policies.
Working Definition of Values and Work Value: Values are your standards that you believe to
be important to you, such as honesty, family time, and loyalty. Work values, on the other hand,
are the beliefs, or standards, that are related to your job, not necessarily the job itself, that are
important to you.
Purpose of the Project: This study will explore blue-collar work values that lead to turn-over
and its impact on retention practices in the manufacturing industry. More specifically, what
employee and organizational values that cause you to stay or contemplate leaving.
Procedures: Should you choose to participate, we will choose approximately 30 people to
participate in a face-to-face interview which will last approximately an hour. Selection was
based on diverse age representation, job description and skill level, longevity with the company,
and participant availability. Management has agreed to allow for participation during work
hours should you be chosen. Follow-up interviews for clarification of information may be
requested prior to putting the data together. After data collection, we will follow up with a
presentation on findings and ask for your feedback.
Risks and/or Discomforts: There are no known risks or discomforts.
Benefits: The information learned from conducting this study will assist strategic human
resource managers in understanding the impact of employee work values in their efforts to
recruit and retain top talent in an industry with increasing demands and opportunities.
Confidentiality: Everyone will have an identifying number that is unique to your name. At no
point will management of this organization or outside this organization will have access to it.
All documents collected for study purposes will be kept in a locked location at the LSU in the
STRATEGIC HRM AND ITS IMPACT ON TURNOVER 17

office of Human Resources for 5 years after the completion of the finalized paper. Demographic
sheets will not be kept after entry in the databases used for analysis. The final paper may be
published but only aggregated data will be used.
Compensation: You will not receive any compensation for your participation in this study.
Availability for Questions: Should you have any questions or concerns, please reach out to
either Robin Morgan at [email protected] or Tammy Hardin at [email protected]. If you would
like to ask questions to our department head concerning participant rights or confidentiality,
please give them a call at 225-578-2710.
Freedom to Withdraw after Study Begins: You have the right to not enroll in this study as
well as the right to withdraw at any time. You do not have to provide a reason for withdrawal.
If you choose to withdraw, your decision will in no way impact your job or your confidentiality.
Consent: If you do decide to participate in this study, you will complete an interview,
participate in a follow-up if necessary, and have the opportunity to comment on findings from
the research.
STRATEGIC HRM AND ITS IMPACT ON TURNOVER 18

Appendix B

Informed Consent Form

Title of Study: _________________________________________________________

Head of Research: _______________________________________________________
Researchers Conducting Interviews: _________________________________________
I acknowledge the following:

● The study was thoroughly explained in plain language and a language I can comprehend. All
questions and concerns about the study have been answered. I understand the process of being
a participant in this study and what is expected of me.
● I have been informed that this study is completely voluntary. I know that I may choose to not
participate or withdraw from this study at any time without reason.
● I have been informed that anything I say during the interview or during the post-research
findings session will be completely confidential. I also have been informed that I can choose to
make my name known. However, without specific written consent my name will be withheld
from any and all documents pertaining to the findings.
● I have the right to not allow the use of my interview to be used in the paper or findings. If my
words from the interviews are used in the findings or the paper, my name will not appear on the
document unless I give written consent to do so.

Commitments:

Commitment Circle Response

I agree to participate in this study. Yes No

I agree that my own words may be used in the final findings and report. Yes No

I agree to have my interview audio recorded. Yes No

Participant Information:
By signing below, you are giving consent to participate and the explanation of the study was given to
me in a language I can understand.

Printed Name of Participant: ________________________________________________

Signature of Participant: ___________________________________________________
Today’s Date: __________________

Witness Information:
Printed name of Witness: _________________________________________________
Signature of Participant: __________________________________________________
Today’s Date: _________________
STRATEGIC HRM AND ITS IMPACT ON TURNOVER 19

Initials of participant after being given a copy of this document and the cover letter: ___________
Appendix C
Stay Interview
“Thanks for taking the time to have this discussion. As one of our key employees, I want to
informally pose some simple questions that can help me to understand the factors that cause you
to enjoy and stay in your current role.”

1. Tell me a little about yourself and the job that you do here.
2. What do you value most in your job?
3. Do you think your employer understands what you value? Explain.
4. Why did you take this job over other potential jobs?
5. What do you enjoy most about working for this organization?
6. Do you feel that you have good work/life balance?
7. What might make you consider leaving your job?
a. What types of things, or needs, isn’t the organization considering when trying to
keep workers such as yourself?
8. What role do you see yourself in at this company in five years? Do you feel that the
company is taking steps to help you to achieve your five-year goals?
9. What specific training or skill would you like to acquire in the short term?
a. If training were offered, would you be interested in participating?
10. Are there any areas of responsibility would you like to take on?
a. If you were given additional responsibility, would it affect your decision to stay