I
[Forthcoming in Communications of the ACM]
Are Companies Fighting a “Turnover Culture” Within IT?
Insights and Implications
JO ELLEN MOORE, Ph.D.
Southern Illinois University at Edwardsville
Department of Computer Management and Information Systems
Campus Box 1106
Edwardsville, IL 62026-1106
Phone: (618) 650-5816
Email: joemoor@siue.edu
LISA A. BURKE, Ph.D., SPHR
Louisiana State University in Shreveport
Department of Management and Marketing
One University Place
Shreveport, LA 71115
Phone: (318) 797-5185
Email: lburke@pilot.lsus.edu
Are Companies Fighting a “Turnover Culture” Within IT?
Insights and Implications
The ability of an organization to retain information technology (IT) staff has become a critical factor in the achievement of strategic goals for most firms today. When an IT professional leaves an organization, not only is the number of IT professionals available for assignment to projects decreased, but the IT professional often takes specialized skills, tacit knowledge, and understanding of specific business operations and information systems out the door. Important business opportunities may be lost when key contributors leave, and the exit of an IT professional who knows a project inside and out can delay or even abolish the implementation of a new technology or information system.
Turnover rates between 25-35% have been reported in Fortune 500 companies, and a supply-demand gap in the IT labor market conceivably exacerbates the IT retention problem as technology professionals not satisfied in present positions are likely to find alternative employment opportunities plentiful [2]. Fortune magazine recently noted that quitting in the technology profession has become literally an annual event, as the average job tenure in IT has shrunk to about 13 months, down from about 18 months two years ago [5]. Turnover in IT has become so accepted that an IT manager recently confided that his subordinates “look at my career and think I’m a loser because I’ve pretty much stayed put in one place” [7].
The concept of turnover culture is emerging in the management literature and can enhance our understanding of what is happening in regard to turnover in IT. Turnover culture has been defined as “the systematic patterns of shared cognitions by organizational or subunit incumbents that influence decisions regarding job movement” [1]. More simply stated, a high turnover culture reflects an acceptance of turnover as part of workgroup norms. In other words, an employee who works within a high turnover culture is likely to believe that turnover is appropriate and perhaps even expected.
Whereas changing companies may be an effective career strategy for some individual IT professionals, most organizations today are striving to retain valued technology personnel. Accordingly, the purpose of the present article is to draw attention of IT managers to the realities of turnover culture, and to explain how this new perspective sheds light on actions needed to retain valued IT talent. Toward this end, we explain the concept of turnover culture, how it develops, the levels at which it may operate, and the potential for turnover culture to specifically affect technology professionals. Then we discuss the implications of turnover culture for IT managers.
TURNOVER CULTURE
The construct of turnover culture is firmly grounded in organizational culture research. Organizational culture has been widely studied by anthropologists and organizational researchers and is generally defined as a set of values and cognitions shared by members of a social unit. These shared values and beliefs are acquired via socialization and social learning processes as individuals experience membership in the company. In addition to the general construct of organizational culture, facet-specific constructs, such as absence and service cultures, have been defined to focus on certain aspects of the general organizational culture. Turnover culture is regarded as a facet-specific construct and, as such, emphasizes the reinforcing influence of social experiences on employee cognition and behavior related to turnover [1].
Two key dimensions of organizational culture constructs, direction and intensity, have been identified by researchers [4]. Direction refers to the actual content or substance of the culture, reflected in the values, behavioral norms, and thinking styles it emphasizes. Intensity is the strength of this emphasis. Organizational cultures varying in intensity have differing degrees of influence on members, and cultures that vary in direction support different behavioral norms and thinking styles. In regard to direction of turnover culture, we use the term high turnover culture to refer to a culture that promotes turnover behavior, and the term low turnover culture to denote a culture that discourages turnover.
How Turnover Culture Develops
Turnover culture evolves in a manner similar to organizational culture, in that artifacts (e.g., stories, customs, information flows, structures) are interpreted by and influence organizational members. When shared, the created artifacts ultimately transform into basic assumptions and mutual cognitive schema regarding turnover perceptions, intentions, and behaviors in the firm. These shared perceptions can intensify as interaction breeds similarity. In other words, as individuals become more emotionally attached to groups, units, or cohorts, over time they become more compliant with established turnover norms, be they high or low.
Social learning theories, a loose descriptive term for a number of approaches that emphasize social and symbolic controls of individual behavior, help us to understand and explain the development of turnover culture. Bandura’s social cognitive theory emphasizes the role of socially-mediated antecedents and consequences of individual-level behavior. Recognizing that people are not autonomous agents, Bandura’s model suggests that behavior, personal characteristics, and environmental events interact to influence each other. Central to his theory are vicarious processes in which individuals learn from attending to and modeling others’ behavior. Therefore, as related to turnover culture, employees learn prevailing attitudes and values about turnover norms by observing others in their work environment.
Salancik and Pfeffer’s social information processing theory sheds additional light on the development of turnover culture. Their theory examines the role of environmental influences on employees’ perceptions and attitudes. It suggests that individuals evaluate their jobs based partly on the social cues provided by others. If colleagues make positive statements about their work, then the favorable aspects of the person’s job become more salient and perceptions of the work situation correspondingly become more positive. Similarly, frequent criticisms from coworkers negatively affect one’s attitudes and perceptions.
These theories elucidate the influence of attitudes and behaviors of others on an individual employee’s decision to quit. Communication patterns and information flows are therefore expected to play a vital role in the development of turnover culture. Indeed, reports from one study indicated that the more similar coworkers were to each other (e.g., occupying similar positions or roles in communication networks) the more likely it was that they would arrive at the same decision to leave or stay [8]. In effect, this study showed that turnover patterns are not independently distributed in organizations, but rather are influenced by informal communication relationships. The researchers ultimately extended a snowball analogy to explain their findings, suggesting that turnover itself breeds more turnover given the enduring effects of social networks and negative effects on those workers who remain.
This leads to viewing the development of turnover culture as a social contagion process. Social contagion denotes a spontaneous spread of affective and/or behavioral reactions among individual members of a group or social collective. A contagion results when a behavior or affect is instigated by “initiators” who function as models by displaying for observers the general form of the act and the positive consequences that result from it. Behaviors tend to be most contagious for observers when high-status models exhibit the behavior and appear to experience positive consequences [12]. Within this framework, acts of turnover by highly-regarded employees are likely to trigger a social contagion process that can lead to a high turnover culture.
To summarize, turnover culture is grounded in organizational theories that emphasize the influence of social processes on an individual’s beliefs and decisions regarding job movement. As such, it captures an important reality -- that attitudes and behaviors of other IT professionals affect an individual worker’s decision to leave the job.
Levels of Operation
Although the level at which turnover culture operates has not been fully addressed by researchers, the management literature suggests that it can operate at industry, organizational, and workgroup levels. Turnover culture at the industry level implies that a particular turnover culture may be common across companies within a specific industry. Essentially, firms within the same industry may adopt similar philosophies and practices related to turnover and, as a result, a high or low turnover culture may become common within that industry. Turnover culture at the organizational level refers to beliefs and attitudes shared by individuals within a firm. Organizational philosophies and management approaches regarding turnover are inclined to differ between organizations and, as a result, turnover cultures are likely to vary from firm to firm. Turnover culture at the workgroup level applies to individuals within an organizational unit (e.g., department or project team). The workgroup level of operation is consistent with organizational researchers who contend that different subcultures often exist within a company and who view this as a natural byproduct of organizational differences in level and function [4].
In addition to those levels of operation, we argue that turnover culture can operate at the occupational group level as well. In other words, turnover culture can exist within an occupational group, such as IT professionals, across firms. IT employees from different companies meet through professional associations, conferences, training classes, and graduate programs at universities, as well as social, community, school and church functions. Attitudes and norms regarding turnover within the IT profession can spread through these interactions. Furthermore, articles regarding IT turnover and the IT labor market in publications commonly read by technology professionals can contribute to turnover culture at the IT occupational group level.
In general, the labor market for a particular occupational group is expected to contribute to turnover culture within that profession. For example, high demand for workers in IT is often enough to trigger some individual IT employees to change jobs, and this activity can fuel a high turnover culture. Similarly, low labor market demand would suppress the urge to move and possibly contribute to a low turnover culture within an occupational group.
TURNOVER CULTURE AND
THE RETENTION OF TECHNOLOGY PROFESSIONALS
The role of turnover culture in an individual’s decision to leave is illustrated in Figure 1. As reflected by the blue lines in the figure, an IT professional’s job satisfaction, perception of job alternatives, and intention to leave the present job are affected by the level of those same sentiments expressed by IT colleagues and friends, as well as by turnover behavior exhibited by those referent others. The technology professional’s turnover attitudes and behavior are also influenced by other sources of information regarding the labor market and movement of IT workers, such as trade magazines, newspapers, and headhunters. The red lines represent the potential impact of the departure of a technology worker on the attitudes and behaviors of other IT professionals.
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Insert Figure 1 about here
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Bottom line, the network of connections in Figure 1 reflect the nature of turnover culture -- that turnover beliefs and behaviors naturally spread through normal, often informal, communication channels. These communication channels and information flows are going to exist in virtually any work environment and, therefore, need to be acknowledged and dealt with. For managers striving to retain IT staff, the occupational and workgroup levels of turnover culture are likely to be of primary interest, so we consider turnover culture at those levels in more detail.
Turnover Culture in the IT Profession
As previously noted, high marketability of job skills likely contributes to a high turnover culture within an occupational group such as IT. Furthermore, within the IT profession, some skillsets may be even more highly marketable than others. In today’s environment, for example, skills associated with network and database management and with Enterprise Resource Planning (ERP) systems (e.g., products such as PeopleSoft and SAP) are in very high demand. In some ways, our management practices may actually contribute to a high turnover culture for such professionals. For example, paying top dollar for contractors to work alongside our own IT staff boldly calls our staff’s attention to the marketability of certain skills and the potential for their own movement to other organizations.
For many technology professionals, inquiries received from headhunters serve as a validation of their marketability. An IT manager participating in a university-sponsored practitioner roundtable on the issue of retaining technology professionals recently remarked that the norm among IT workers is that you should be receiving headhunter calls -- if you aren’t, there is something wrong with you. Bottom line, for IT professionals with specific skillsets or IT professionals in toto, strong labor market demand stimulates the movement of individual workers and likely contributes to a high turnover culture within the IT occupational group.
Turnover Culture in IT Workgroups
An IT workgroup is considered to be an organizational unit that includes a staff of IT professionals, and management practices often contribute to turnover culture in IT workgroups. For example, offering compensation and rewards that are significantly inferior to those being offered by other companies for the same type of work can trigger employee movement and contribute to high turnover culture within an IT workgroup. The sentiment of “why work for peanuts when there’s real money to be made?” can spread through the group, infecting even those IT professionals who prior to taking in this perspective had been perfectly satisfied in their jobs.
A tendency to move mid-career IT workers aside and bring in recent college graduates can also contribute to a high turnover culture at the IT workgroup level. Recent college graduates tend to command lower salaries than IT professionals who have been with the company a while, and they are often familiar with new technologies that the company may be wanting to incorporate. Displacement from desirable projects may lead mid-career workers to look for job opportunities outside the company or to look for alternative career opportunities outside of IT.
And, depending on how they are managed, a turnover culture may develop among the newly-hired college graduates. Some have charged that a desire for cheap labor is at the heart of managing IT human resources, and recent college graduates are a primary source of cheaper labor [9]. Recent graduates are typically single and, presumably, can work large amounts of overtime without being constrained by family responsibilities. Such an IT human resource management strategy is reflected in a quote from a hiring manager in a Silicon Valley firm: “You work the young ones for five years and then replace them” [9].
Along that same line, persistently overloading IT professionals with work (at any stage of their career) is likely to contribute to a high turnover culture in IT workgroups. Research shows that IT professionals experiencing work exhaustion report significantly higher intentions to leave the job [10]. Exhausted technology professionals have described work environments in which “management places unrealistic and arbitrary goals on us, then refuses to hire anyone to help" [10]. If work overload and exhaustion are common within the workgroup, IT professionals are likely to have observed others experience the problem and successfully resolve it by leaving the job. In this manner, work overload and exhaustion can contribute to a high turnover culture in IT workgroups.
Ultimately, a high turnover culture in IT workgroups is a real concern for managers because it can impede progress toward corporate goals. For example, if IT professionals on ERP projects consistently depart within a year of receiving ERP training, the organization’s implementation efforts can be severely hampered. This would, in turn, likely heighten the workload and frustration levels of remaining workers, further exacerbating a high turnover culture.
“Romance of Turnover”
Finally, a high turnover culture at any level could involve a “romance of turnover.” Departing IT professionals are often treated as heroes -- those who succeeded in finding a way out. Often only the positive aspects of the departing employee’s new job (those factors that made him or her decide to leave for the new position) are shared with coworkers and friends. The actual consequences (good and bad) that result from the job change may never be known to those left behind. As a result, observers could romanticize turnover as the ultimate solution to problems and issues encountered by IT professionals. A “romance of turnover” may enhance perceptions of the acceptability and outcomes of turnover and, ultimately, act to perpetuate and strengthen a high turnover culture.
IMPLICATIONS
Does Turnover Culture Matter?
Traditional turnover research has tended to focus solely on individual-level variables and, consequently, has produced a much too narrow view of the turnover picture. The concept of turnover culture provides a valuable perspective for understanding how turnover can breed more turnover. Decisions to leave can spread like a social contagion, particularly within a favorable labor market. Although this contagion may operate at the industry level and very probably operates at the occupational group level, managers are likely to more immediately influence turnover culture at the workgroup and organizational levels. Accordingly, this is where we focus our discussion of practical implications for IT managers.
Let us consider the ramifications to an organization experiencing a high turnover culture. In addition to oft-cited estimates of expenses incurred when an employee is lost (e.g., $150,000 each time a worker leaves a particular IT consulting firm [9]), additional, less-quantifiable consequences are likely to occur when a high turnover culture persists. In his classic treatise on exit and voice, Hirschman noted that when exit is an easy alternative, the use of voice tends to atrophy [6]. The organization loses valuable comments and suggestions from those workers who exit and, as a result, employee voice needed to push the organization to correct a situation may be lost.
Essentially, in a favorable labor market, employees can opt for the neatness of exit over the messiness of voice: “Why raise your voice in contradiction and get yourself in trouble as long as you can… remove yourself entirely from any given environment should it become too unpleasant?” [6]. Hence, incorrect situations (situations not aligned with corporate goals) may go uncorrected in a high turnover culture because employees have begun to see exit as a simpler, more expedient, and more viable solution than voice.
Furthermore, frequent exits can disrupt employee development efforts. Tim Stone, a product manager at a large technology company, noted in personal communication with one of the authors that constant job movement can reduce the level of personal responsibility a worker feels. By not staying on the job long enough to observe and experience the ramifications of their work and decisions, IT professionals may not feel or understand the very real impact their actions have on the corporation. Without such feedback, individuals miss important opportunities for performance improvement and opportunities to learn from mistakes. And loyal IT staff will be the first to point out that, in environments where job-hopping is common, they are the ones left behind to deal with the fallout from workers exercising their mobility. This can perpetuate a high turnover culture, as previously loyal IT professionals tire of continuously dealing with such fallout and decide to exercise their own mobility.
Along this same line, a high turnover culture can contribute to a recently identified paradox in the movement toward managing organizational knowledge. Some HR practices in IT (such as placing a hiring focus on specific skillsets and recent college graduates) work directly against the goals of organizational knowledge management [11]. Such practices can displace an organization’s mid-career IT professionals from key, leading-edge projects; ironically, these are the workers who possess the most extensive and valuable tacit knowledge. To manage organizational knowledge, firms have been encouraged to pay careful attention to the management of tacit as well as explicit knowledge, because tacit knowledge enables the firm to learn faster and to develop more creative and valuable insights than its competitors. Unfortunately, a high turnover culture, particularly one that encourages mid- and senior-level workers to leave, can thwart the attainment of corporate goals that involve the creation, protection, and management of organizational knowledge.
What To Do?
Results from a recent study of IT personnel practices in successful organizations elucidate the importance of clearly defining and articulating an IT human resource strategy. Moreover, firms are encouraged to shift their focus from myopic HR remedies (e.g., one-time inducements or bonuses) to more holistic HR solutions [2]. Firms are therefore encouraged to contemplate systemic solutions that comprehensively address the retention of valued IT personnel, through foundational elements such as the proper management of workloads and assignments, rewards, and training and development.
In a systemic approach to curb the development and spread of a high turnover culture, we advise managers to begin by dealing with workgroups rather than the entire organizational workforce. This strategy implies that improvements in turnover culture within workgroups can spread to an improved turnover culture at the organizational level. The key to this strategy is twofold. A manager must: (1) improve communication channels, and (2) address unresolved issues felt by the workgroup.
These tactics are in line with Hirschman’s classic views on exit and voice. He noted that when one mechanism (such as exit) becomes predominant, use of the less familiar mechanism (voice) requires that its power be discovered or rediscovered [6]. Managerial practices to improve communication and address primary concerns of valuable IT employees are necessary to reestablish the effectiveness and viability of voice. Bottom line, IT professionals need to discover (or rediscover) voice as a viable means by which they can alleviate job problems and initiate improvement and corrections in their work environment in order for a high turnover culture to be curtailed.
For IT managers, listening is very likely the first step to correcting problems. Listening, alone, may help to retain IT professionals whose biggest gripe is that their ideas are ignored [3]. Bruce Fern, an IT retention consultant at Integral Training Systems, as quoted by Steve Alexander in Computerworld, advises managers to be on the lookout for quiet people who start complaining and for complainers who become quiet. The latter may have stopped complaining because they’ve given up on their jobs and are starting to look for something better [3]. Also, managers can utilize improved communication channels to point out the advantages of staying with the firm (while working to make those advantages realities).
Rather than throwing more money towards the retention problem, in the form of burgeoning bonuses, extraordinary benefits, and bulging salaries, the aforementioned recommendations point to the need for managers to include IT professionals in the formulation of a turnover solution. Firms experiencing a high turnover culture need to listen to their IT staff and begin creating direct responses to the various dissatisfactions IT professionals are actually experiencing in their jobs (e.g., adjustments to workload or assignments), as opposed to simply buffing up the job’s extrinsic accoutrements. Essentially, the key to diffusing a high turnover culture lies in good communication with and active management of valued employees. As Fortune magazine recently argued, most people don’t quit because of money -- they quit because of bad bosses [5].
CONCLUSION
Practitioners and researchers alike need to incorporate turnover culture in efforts to understand, manage, and predict the turnover of IT professionals. This relatively young construct promises to enhance our understanding of how individual turnover decisions are influenced, and how tendencies for job movement spread through workgroups and companies and even professions. In addition to illuminating values and beliefs of IT employees in regard to turnover, attention to turnover culture can lead to a more accurate and comprehensive picture of how managerial practices and social networks influence the turnover of IT professionals.
References
1. Abelson, M.A. Turnover cultures. Research in Personnel and Human Resources Management, 11 (1993), 339-376.
2. Agarwal, R., and Ferratt, T.W. Coping with Labor Scarcity in Information Technology. Pinnaflex Educational Resources, Cincinnati, OH, 1999.
3. Alexander, S. Hints of discontent. Computerworld, 31, 49 (1997), 62.
4. Cooke, R.A., and Rousseau, D.M. Behavioral norms and expectations: A quantitative approach to the assessment of organizational culture. Group & Organization Studies, 13 (1988), 245-273.
5. Daniels, C., and Vinzant, C. On the job: The joy of quitting. Fortune, February 7, 2000, 199-202.
6. Hirschman, A.O. Exit, voice, and loyalty. Harvard University Press, Cambridge, MA, 1970.
7. Hymowitz, C. On the Job: Coping with Youth -- and Impatience. The Wall Street Journal Sunday, St. Louis Post-Dispatch, December 19, 1999, E3.
8. Krackhardt, D., and Porter, L.W. The snowball effect: Turnover embedded in communication networks. Journal of Applied Psychology, 71 (1986), 50-55.
9. Matloff, N. Debunking the myth of a desperate software labor shortage. Testimony presented to the U.S. House Judiciary Committee on Immigration, April 21, 1998.
10. Moore, J.E. One road to turnover: An examination of work exhaustion in technology professionals. MIS Quarterly, 24 (2000), 141-168.
11. Trauth, E.M. Who owns my soul? The paradox of pursuing organizational knowledge in a work culture of individualism. In Proceedings of the 1999 ACM SIGCPR Conference (New Orleans, LA), ACM Press, NY, 1999, 159-163.
12. Wheeler, L. Toward a theory of behavioral contagion. Psychological Review, 73 (1966), 179-192.
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Figure 1. Turnover Culture: Key Communication Flows Related to an
IT Professional’s Departure
IT Professionals
Outside the Organization
IT Workgroup
Other Sources of Information
About Job Movement in IT
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