The Effect of employee turnover management on organizational performance among digital credit providers in Kenya

Abstract

The turbulent and ever-changing business environment in Kenya has necessitated organizations to start investing in training their workforce. However, digital credit providers in Kenya grapple with a notable level of employee turnover, a concern heightened by the associated costs of losing experienced and skilled employees. The organizations invest significant resources in recruiting and training new employees, making the escalating trend of employee departures, excluding the exceptional years of 2019 and 2020 during the global COVID-19 pandemic, a cause for both management and employee apprehension. Therefore, the study sought to examine the effect of employee turnover management on organizational performance in digital credit providers in Kenya. The specific objectives of the study were to establish the effect of work-life balance, structured reward scheme, employee recognition and career growth on organizational performance in digital credit providers in Kenya. The study was anchored on Herzberg two factor theory and the balanced scorecard. The study adopted a positivism research philosophy and descriptive cross-sectional research design. The target population was therefore, all the 946 employees working in the 5 selected digital credit providers in Kenya. The study utilized Slovin's Formula in the determination of the sample size. Simple random sampling was used in the selection of the study’s sample size. Primary data was used, which was collected through structured questionnaires. The research instrument generated quantitative data, which underwent editing, coding, and entry into the Statistical Package for Social Sciences (SPSS version 22). Descriptive statistics, including frequency distribution, percentages, mean, and standard deviation, were employed. Subsequently, inferential statistics such as Pearson correlation analysis and regression analysis were conducted. The results were presented through tables and graphical representations like bar charts and pie charts. The study findings indicated that work-life balance has a positive and significant effect on organizational performance in digital credit providers in Kenya. In addition, the study found that structured reward scheme has a positive and significant effect on organizational performance in digital credit providers in Kenya. The study established that employee recognition has a positive and significant effect on organizational performance in digital credit providers in Kenya. The study also revealed that career growth has a positive and significant effect on organizational performance in digital credit providers in Kenya. The study concludes that employee turnover management, in terms of work-life balance, structured reward scheme, employee recognition and career growth, has a significant effect on organizational performance in digital credit providers in Kenya. The findings imply that prioritizing employee turnover management strategies, including work-life balance, structured rewards, recognition, and career growth, would lead to an improvement in organizational performance in digital credit providers in Kenya. Therefore, the study recommends that the management of digital credit providers should develop awareness campaigns within their companies to educate employees about the various flexible work options available to them and how they can utilize them to achieve better work-life balance. They should also review and potentially enhance retirement savings and pension plans offered to ensure they adequately support employees' future financial security.