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Overcoming Turnover Intention Problems: Direct-Indirect Model To...

OVERCOMING TURNOVER INTENTION


PROBLEMS: DIRECT– INDIRECT MODEL
TO IDENTIFY THE EFFECT OF PERCEIVED
ORGANIZATIONAL SUPPORT AND
JAM JOB SATISFACTION IN SERVICE-BASED
19 17, 3 ORGANIZATIONS
Received, July 2019
19 Revised, July 2019
August 2019
Accepted, August 2019 Elvira Azis
Arif Partono Prasetio
Kristian Heri Utomo
School of Economic and Business, Telkom University, Bandung, Indonesia

Abstract:Current study investigates the direct effect of perceived organizational support


on turnover intention and the mediation of job satisfaction in the relation. The turnover
intention has become important issues in human resource management. It can cause losses
and distraction in the business. The organization needs to identify what are the main
factors which contribute or drive an employee to resign. By identifying such factors, they
can improve their human resources practices to retain outstanding employees. Perceived
organizational support considered havingan important effect on employee regarding their
perception towards the organization. Meanwhile, the thoughts of leaving the organization
can also develop from a low satisfaction level. The organization must be aware of this
condition to retain the best performers. This study used 366 participants from the various
organization in West Java and consisted of a manager, supervisor, and officer. We con-
ducted mediation analysis, and the result showed only a small direct effect from perceiving
organizational support on turnover intention while job satisfaction mediated the relation.
The intervention proves to have a greater impact on reducing the intention. This finding
corroborated previous literature and underlined that perceive organizational support and
job satisfaction can help an organization in mitigating turnover level.

Keywords: Turnover Intention, Job Satisfaction, Perceived Organizational Support, Media-


tion Analysis
Journal of Applied
Management (JAM)
Volume 17 Number 3, Cite this article as: Azis,E., Arif P. Prasetio, and Kristian H. Utomo. 2019. Overcoming
September 2019 Turnover Intention Problems: Direct– Indirect Model to Identify the Effect of Perceived
Indexed in Google Scholar Organizational Support and Job Satisfaction in Service-Based Organizations. Jurnal
Aplikasi Manajemen, Volume 17, Number 3, Pages 555–566. Malang: Universitas Brawijaya.
http://dx.doi.org/10.21776/ub.jam.2019.017.03.20

The contribution of human no engagement would fail the company. An organi-


Corresponding Author: resources in supporting com- zation has to care about their employees for them
Elvira Azis, School of Eco-
nomic and Business, Telkom pany success has been rec- to support the organization achieving its target. It is
University, Bandung, Indone-
sia, DOI: http://dx.doi.org/10.
ognized. Boyce (2015) as- a must for paying attention to employees’ concerns
21776/ub.jam.2019.017.03.20 sured that an employee with and development since all activities in the business

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Elvira Azis, Arif Partono Prasetio, Kristian Heri Utomo

organization will always be related to human contri- over in Indonesia is currently 15,8% and is ranked
bution (Ferres, 2015; Ryan, 2016). The demands on 4th in the world (Gutmann, 2016). In their report in
creativity, decision-making ability, and analytic think- 2015, Michael Page (2015) stated that 72% of re-
ing are increasing in the work field. All of them are spondents said they considered to resign in 12
related to human. months. The proportion should be enough to encour-
Moreover, Leonard (2019) informed that em- age organizations to be attentive to TI.
ployees who work well contribute to the success of The current study aims to analyze the TI level
the company as a whole. Therefore, the company in service companies (installation, retail, contractors).
needs to manage its human resources optimally. One It aims as well to examine whether TI is affected
of the indicators of good human resources manage- by the perceived organizational support and employ-
ment is the low number of resignation.There are ees’ job satisfaction. High level of turnover can
many examples where the employee resignation cause problems to companies which depend on hu-
impacts the company. Nowadays, employment re- man resources. A continuous change will hamper
cruitment is getting more competitive. Every com- business and cost big money (Faugno, 2017). Ac-
pany gives a competitive offer to attract or main- cording to LinkedIn (Booz, 2018),the service sector
tain well-achieved employees. has the highest level of turnover. In 2017, the soft-
On top of that, currently, many younger gen- ware company was in first place with a percentage
erations are introduced to the labor market. It causes of 13,2%. It is followed by the retail company with
inevitable employee circulation and also adds the (13.0%), media/entertainment (11.4%), and profes-
complexity of workplace interactions.This differ- sional services (11.4%). The data shows that com-
ences can act as a driver, which trigger the inten- panies in the service sector have a hard time to
tion to leave. Resignation is a common thing and maintain their employees.
even cannot be avoided. However, if it happens in Mean while, service business dependson its em-
large numbers in a short time, it will affect the busi- ployees. Moreover, Dale Carnegie’s survey result
ness activity (Moran, 2011). There will be financial showed that younger generations develop a lack of
(recruitment and training cost) and non-financial loyalty to the company (Triwijanarko, 2017), which
(consumer loss, decreasing productivity, unachieved can increase the challenge to retain good employ-
sales, increasing complain) loss. This is in line with ees. Identifying employee turnover after it occurred
Pertiwi’s (2018) statement that turnover affects will be too late. Accordingly, many studies about
employees’ financial and moral aspect. Due to its employees’ resignation focus on whether there is
negative effect, the level of turnover should be man- or no intention to resign. This is empowered by the
aged. notion that employees’ resignation is influenced by
To overcome turnover intention, a company the existence of the intention to resign (Rai, 2017).
needs to know what factors essential to do so. Pre- The current study examines the turnover problems
vious studies have suggested factors which influ- in three organizations in West Java, that is A (retail
ence employees’ degree of turnover intention (TI). business), B (cable installation), and C (contractors).
Park & Kim (2009) found a negative correlation of This study will benefit in preventing phenomenon
job satisfaction and organizational culture with TI in which will harm the organization in the long term.
South Korea. Other factors with high correlation Analyzing deeply about potential aspect causing
with TI are affective commitment (Lee et al., 2018), resignation will allow the organization to detect in
perception of justice (Cao et al., 2013), work-fam- advance and prevent employees’ voluntary resig-
ily enhancement (McNall et al., 2010), engagement nation.
(Ang et al., 2013), perceived organizational support
(Park et al., 2015), company citizenship (Islam et LITERATURE REVIEW
al., 2018), clan-oriented organization culture POS (Perceived organizational support) is a
(Haggalla & Jayatilake, 2017). The level of turn- perception and belief of an individual related to the

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Overcoming Turnover Intention Problems: Direct-Indirect Model To...

degree of support provided by the organization to of the improvement of commitment to the organiza-
keep works run well. Robbins & Judge (2017) de- tion (Allen et al., 2003), high engagement (Shantz
fined POS as the degree of employee’s belief that et al., 2014), and boosted corporate citizenship spirit
the organization they work appreciate and care about (Miao & Kim, 2010). Another positive impact is that
their contribution. Meanwhile, Eisenberger et al. positive work attitudes and behaviors imply the ful-
(2001) explained that POS is a perception of em- fillment of the company performance target. How-
ployee about organization appreciation and care to ever, if the employees did not feel the support from
their work and welfare. POS is frequently related the organization, then as the social exchange con-
to employees’ feeling about the recognition they get cept stated, they slowly will consider leaving. This
from the company. Recognition comes in many is supported by Park et al. (2015), Islam et al. (2018),
forms, such as offering interesting payment, respect- Tuzun & Kalemci (2012), Allen et al. (2003),
ing their rights, understanding their needs, creating Blomme et al. (2010), Kumar et al. (2018), Oliveira
a good work atmosphere, equity, fairness, and ap- et al., (2017), Arshadi (2011), and Shantz et al.
preciating their contribution. Employees who feel (2014). A study with respondents with various back-
like they are strongly supported will develop a posi- ground from China, United States, Turkey, Pakistan,
tive perception. A meta-analysis suggested that there Netherland, India, Brazil, Iran, and England showed
is a strong and moderate impact of POS on job sat- a negative correlation. It implies that as the per-
isfaction, engagement, commitment to the organi- ceived support from the company gets stronger, they
zation, corporate citizenship behavior, and turnover will repay with higher engagement and remain in
(Ahmed & Nawaz, 2015). the company longer.
As previous studies have confirmed, one of the Maleki (2016) explained the term job satisfac-
impacts of POS is the degree of employees’ turn- tion as an emotional response of employees when
over. Turnover is the rate of employees’ resignation evaluating diverse dimension in their job. The di-
(Dessler, 2013). Snell & Bohlander (2013) explained mension involves job type, carrier development, in-
further that it is an employees’ movement to resign teraction with employer and colleague, as well as
from the company. This movement is encouraged received compensation. Meanwhile, the definition
by the intention to resign. Turnover intention is the stated by Robbins & Judge (2017) it is a positive
tendency of employees in trying to leave their com- feeling on the job after evaluating every character-
pany, which they might put into action later (Chen istic of their jobs. Based on preceding statements,
et al., 2014). The employees who have this kind of job satisfaction is referred to like the feeling of plea-
tendency can cause problems for the company. The sure and convenience in employees toward every
intention can cause a decrease in productivity and aspect of their job. The judgment has resulted after
performance as well (De Winne et al., 2018; Kuvaas quite long experience and different conditions.
et al., 2017; Kwon & Rupp, 2013) if this tendency Therefore this satisfaction on the job is dynamic by
comes real, then the organization will suffer a big- its nature. The employees may satisfy at a time but
ger loss. Huang & Su (2016) The company will lose feel the opposite in another time.
important knowledge. The company will also suffer The urgency of employees’ satisfaction makes
the decreasing consumer’s satisfaction (Hurley & researching this topic become essential. The com-
Estelami, 2007), the increasing cost (North et al., pany needs to be assured that its employees have a
2012), lack of group collaboration (Bae et al., 2010). high degree of job satisfaction. The positive impact
Based on the reciprocity concept suggested by of employees being satisfied has been proved
Gouldner (1960), there is a sense of obligation in through researches in many countries. Alsiewi &
someone to help others who helped them. Concern- Agil (2014) found that there is a significant positive
ing the work environment, employees who perceived association between job satisfaction and affective
the ease and support from the company will repay commitment of teachers working in a public educa-
through positive behaviors. This can be in the form tion institution in Libya. Another positive correlation

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Elvira Azis, Arif Partono Prasetio, Kristian Heri Utomo

was found in a study on bankers in Malaysia (Islam H1: Perceived organizational support will have a sig-
et al., 2014). The high degree of job satisfaction nificant negative effect on TI
leads to the improvement of employees’ loyalty H2: Job Satisfaction will have a significant nega-
(Onsardi et al., 2016), motivation at work tive effect on TI
(Bonenberger et al., 2014), employees’ trust (Nasra H3: Perceived organizational support will have a sig-
& Heilbrunn, 2015), learning spirit (Mirkamali et al., nificant positive effect on job satisfaction
2011), and eventually employees’ performance H4: Job Satisfaction will have a mediation role in
(Fried et al., 2008; Mendis & Weerakkody, 2017). the effect of perceived organizational support
The high level of loyalty can be judged from the low on TI
level of turnover intention.
Job satisfaction is frequently addressed as an METHOD
important factor to maintain employees in the orga- Participants
nization. Employees who feel satisfied with their jobs
Data were collected using a non-probability
fully or partially through various dimensions, such
method with convenience sampling and receive valid
as leadership, salary, and colleagues carrier devel-
responses from 366 employees from three compa-
opment tend to have low turnover intention. The
nies; A (retail), B (cable installation), and C (con-
satisfaction of salary is strongly negatively corre-
tractor). 83% of participants are male, and 17% of
lated to TI (Raza et al., 2017). Employees who per-
the female. We distributed a questionnaire through
ceived compatible leadership and feel satisfied will
the human resource department of each company
less likely to resign (Tnay et al., 2013). A study con-
(200 for the retail, 150 for the cable installation, and
ducted by Westlund & Hannon (2008) suggested
200 for a contractor).This distribution was conducted
the negative relationship of satisfaction related to
under permission of the human resources depart-
colleagues, carrier, and working atmosphere to the
ment starting from January until July 2018.We get
employees’ tendency to resign. Study in United
171 useable responsesfrom retail, 85 responses from
States, South Korea, Iran, Cyprus, Bangladesh,
cable installation, and 110 responses from a con-
Pakistan, and Spain also found that job satisfaction
tractor. 34% of the respondents were 30 - 35 years
negatively correlated to TI (Allen et al., 2003; Chung
old, while participants over 40 years old were only
et al., 2017; Fayyazi & Aslani, 2015; Daskin et al.,
9%. It is likely the service sector prefers the younger
2015; Rubel & Kee, 2015; Malik et al., 2010; Vidal
employees to deal with their customers. The respon-
et al., 2007). Those findings support the view that
dents work for a relatively long period. Most of them
job satisfaction associated with the degree of TI
work for 3 to 5 years. The majority of the partici-
negatively (in the opposite direction).
pants had not married (51%) and work up to 9 hours
This direct relationship between job satisfac-
a day.
tion with TI encouraged some researches to label
job satisfaction as the mediating factor of other in-
Analysis Technique
dependent variables and the degree of TI. Those
studies established the position of job satisfaction This study examined the association between
as mediating element of work-life balance, work- stress level and TI with job satisfaction as a medi-
family conflict, perceived organization support, or- ating variable. The correlation of variables was ana-
ganization culture, and work stress (Noor, 2011; lyzed using SPSS version 21. To analyze the effect
Mihelic, 2014; Park & Kim, 2009; Allen et al., 2003; of stress level on TI and mediating element of job
Fried et al., 2008). satisfaction, the bootstrapping approach was made
Based on the review of previous studies re- using PROCESS Macro (Hayes, 2018). This tech-
lated to organizational support, job satisfaction, and nique is considered suitable since the normality as-
degree of TI, the current study proposed the fol- sumption did not have to be satisfied through the
lowing hypotheses; application of bootstrapping confidence intervals

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Overcoming Turnover Intention Problems: Direct-Indirect Model To...

Table 1 Respondents Profile Table

Characteristic Category Number Percentage Characteristic Category Number Percentage


Gender Male 304 83% Tenure < 1 years 39 11%
Female 62 17% 1 - 3 years 80 22%
Age < 25 years 45 12% > 3 - 5 years 158 43%
25 - 30 years 87 24% > 5 - 10 years 62 17%
> 30 - 35 years 123 34% > 10 years 27 7%
> 35 - 40 years 47 13% Position Officer 282 77%
> 40 - 45 years 29 8% Supervisor 18 5%
> 45 - 50 years 20 5% Manager 66 18%
> 50 years 15 4% Education High School 257 70%
Marital Married 168 46% Diploma 53 14%
Single 188 51% Under Graduate 47 13%
Separated 10 3% Post Graduate 9 2%
Children Yes 162 44% Work Hour ≤9 hours 327 89%
No 204 56% >9 hours 39 11%

(Preacher et al., 2007). The mediating element of the middle point. This is to avoid respondents se-
job satisfaction determined using upper level and lecting middle choice (neutral or moderate) as it fre-
lower level confidence interval, which did not con- quently happens in eastern cultural society. The low-
tain zero. The previous studies which employed the est point 1 represents Not Agree, and the highest
same technique were Costa et al. (2014) and Gray point 6 implies Agree.
et al. (2015).
RESULTS
Measures Table 2 shows the correlation coefficient of
There were 6 Items to measure perceived or- demographic, perceived organizational support, job
ganizational support and were adopted from satisfaction, and TI. It implies that demographic
Eisenberger et al. (2001). The Cronbach Alpha is aspects correlated to variables are just position and
.940. Items to measure job satisfaction were adopted education. High-educated employees are less likely
from Prasetio et al. (2017) with Cronbach Alpha of to perceive organizational support. It prevails as well
.929. Items to measure TI was adopted from to the higher-level-educated employees. Perceived
Prasetio et al. (2019) with Cronbach Alpha of .798. organizational support and job satisfaction have a
All items were administered using a six-point Likert positive correlation. However, both variables are
scale. Fourth and fifth points were extended from negatively correlated with TI.

Table 2 Mean, Deviation Standard, & Correlation

Std.
Mean 1 2 3 4 5 6 7 8 9
Deviation
1. Age 3.1311 1.52037 1
**
2. Marital 1.5683 .54845 -.504 1
** **
3. Tenure 2.8852 1.04839 .680 -.415 1
** ** **
4. Position 1.4098 .77729 .622 -.451 .535 1
** ** ** **
5. Education 1.4754 .80967 .459 -.345 .332 .630 1
** ** ** ** **
6. Workhour 1.1066 .30897 .273 -.180 .232 .217 .191 1
7. Perceive Support 5.0167 .77651 -.088 .121* .068 -.136** -.212** -.057 1
* **
8. Job Satisfaction 4.9947 .53358 -.060 .026 .134 -.052 -.073 -.090 .540 1
9. Turnover Intention 2.4970 .84297 .049 -.050 -.091 .083 .067 .075 -.359 -.524**
**
1

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Elvira Azis, Arif Partono Prasetio, Kristian Heri Utomo

Regression coefficient in Table 3 showed that Therefore H1, H2, and H3 were failed to be rejected.
p-value < .005 for all variable correlation. It implies Organizational support affects the degree of job
that all independent variables significantly affected satisfaction and turnover intention. It obtains as well
the dependent variable. It differs in terms of the that as job satisfaction increases, the employees
direction. The negative direction is for the effect of more likely to remain in the organization.
organizational support and job satisfaction to TI.

Table 3 Model coefficient

Job Satisfaction Turnover


Coeff SE p-value Coeff SE p-value
Perceived Support 0.371 0.030 0.000 -0.116 0.083 0.000
Job Satisfaction - - - -0.737 0.057 0.043
Constant 3.134 0.154 0.000 6.761 0.358 0.000
R Square 0.291 R Square 0.283
F= 149.65 F= 71.622
p= 0.000 p= 0.000

Before discussing the results, it is informed that ferent degree of POS, yet the same level of job
the analysis result is in the form of the satisfaction will decrease in TI as much as -.116.
unstandardized coefficient. Employees with strong The combined effect is -.273 + (-.116) = -.389.
POS will have a higher satisfaction on their job. It is What comes next is the analysis of job satis-
observed from the table as well that everyone en- faction as a mediating variable. As defined before,
hancement of POS will improve .371 of job satis- there should not be zero in Lower Level a positive
faction. Furthermore, one improvement of job sat- in Upper Level (Hayes, 2018). The analysis using
isfaction will cause a decrease in 0,737 of turnover Process are shown in Table 4. Both of the points
intention. The indirect impact of POS on TI was were negative. Therefore, it can be concluded that
mediated by job satisfaction. The magnitude is .371 job satisfaction has a role as a mediating element in
x -.731 = -.273. It means that the employees who the correlation of perceived organizational support
perceived support from their company and is satis- and TI. Figure 1 shows the illustration of associa-
fied with their job will lessen their intention to re- tion among variables.
sign as much as .273. Employees who have a dif-

Table 4 Indirect Effect of Job satisfaction

Effect BootSE BootLLCI BootULCI


Perceive Support  Job
-0.273 0.051 -0.378 -0.181
Satisfaction  Turnover

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Overcoming Turnover Intention Problems: Direct-Indirect Model To...

Job Satisfaction
p value < 0.01 p value < 0.05
0.371 -0.737

Turnover
Perceived Support
Intention
-0.116
p value < 0.01
Figure 1 Mediation model

DISCUSSION found by Dawley et al. (2010) in the United States,


It is proven that POS, job satisfaction, and TI Park et al. (2015) in China, Blomme et al. (2010) in
have a significant association. Due to its positive Belanda, Tumwesigye (2010) in Uganda, and
impact on job satisfaction, organizational support Perryer et al. (2010) in Australia.
should be included in the internal practice of an or- Furthermore, satisfied employees will give a
ganization. Rewarding employees for their dedica- positive response because of two main reasons.
tion and contribution, provide health insurance to Firstly, according to the conservation of resources,
outstanding employees, providing a formal channel one will collect as much as possible resources they
which can be used to address employee’s problems, believe they need in the future. Job, carrier, salary,
attentive to employees’ work or non-work related and a good environment are important resources. If
constrain are several options that can be imple- an individual has all of them, they certainly will try
mented to show support.With such support, employ- to keep them preserved. One of the ways is to keep
ees will be satisfied with their job. If one takes a working in a company which provides those re-
close look, the steps taken by the organization to sources. Therefore, there will be a reason for them
manifest positive support to their employees have a to quit, secondly, based on a social exchange, which
similar dimension with the ones in job satisfaction; stated that an individual tends to return what they
caring employer, supportive colleagues, sufficient have received. The positive condition given by the
compensation, fun work, and carrier continuity war- company will lead to a positive return as well. Em-
rant. Therefore, it is not a surprise if a high degree ployees will work harder, more diligent, productive,
of POS will affect job satisfaction. These findings and loyal. This will lessen the turnover intention.
supported the results of Bilgin & Demirer’s study Individuals who perceived attention, adequate sup-
(2012) in Turkey, Donald et al. (2016) in South Af- ports, and needs fulfillment will reciprocate to re-
rica, and Alcover et al. (2018) in Spain. The signifi- turn the favour by stay longer in the organization.
cance of the association of POS and job satisfac- This is reinforced by Daskin et al. (2015) in Cyprus,
tion were represented enough in researches from Jaramillo et al. (2006) in the United States, Ang et
different backgrounds. al. (2013) in Australia, and Ibrahim et al. (2016) in
Employees who perceived that their company Nigeria.
is supporting them will have a lesser tendency to Since the direct effect of POS to turnover in-
walk out. According to the conservation of resources tention was low, and the indirect effect of job satis-
theory, an individual will strive to maintain resources faction show stronger value, the company have to
benefitting them. Employees will not let go of the focus on supportthat will enhance employee’s sat-
organization in an ideal condition which gives them isfaction. Job satisfaction usually concerns about
discretion. This is in line with the findings of Islam salary, leader, co-worker, career, and job it-self. In
et al. (2018) in Pakistan that fostered POS will de- that case, the support should address those impor-
crease the intention to resign. Similar results were tant factors. Evaluating or re-design job can make

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Elvira Azis, Arif Partono Prasetio, Kristian Heri Utomo

it interesting, a dull job can be frustrated for em- namic and unpredictable, human resources manager
ployees, so the company needs to developa chal- should anticipate those conditions. This is vital to
lenging environment. They also have to equip the conduct routinely since the resignation of well-
leader or manager with interpersonal skills, which achieved employees will cause a big loss for the
can help increase communication quality. Not just organization.
discussing work-related problems, but also they can However interesting, this study still has some
provide a personal touch in building relationships with limitations. First, the number of participants need to
their sub-ordinate. The challenging job should be be increased if scholars want to enhance the gen-
accompanied by a promising career and reward. eralization capability of the study. It should cover
The positive work environment also playsa crucial more industries also. Secondly, this is a cross-sec-
role. Interaction with co-worker should be monitor tional study which gathered data from the one-time
closely not to interfere but to identify whether there point. As we deal with human and their attitude and
are problems or negative behavior. Early detection behavior can change overtime, the longitudinal study
regarding co-worker relation can help decrease the can be applied to increase the accuracy of the mea-
negative environment caused by bad relation. surement. With this, we can identify the attitude and
Next thing to do to show support is that man- behavior pattern in more detail.
agement needs to setup a clear career path and
continuously provide advancement opportunity. CONCLUSIONS
Employees should be notified whether they are per- All hypotheses in this research are failed to be
formed or need improvement. This has to be done rejected. This implies that POS directly and indi-
to keep the employee informed regarding their ca- rectly (through job satisfaction) affects turnover in-
reer opportunity. Lastly, since most of the turnover tention. In this competitive era, the corporation which
intention emergence affected by the outside envi- shows their full support to the employees will re-
ronment, the company needs to be aware of com- ceive a positive impact in increasing job satisfaction
petitors. Nowadays, competition is not just about and will also muffle employees’ intention to resign.
winning over consumers, but also about attracting The organization will find it hard to compete if they
new and high-quality talents. Despite getting rec- have turnover problems. They will suffer in terms
ognition and fulfilled needs, employees will move to of time and cost. This study proved that job satis-
the place with better opportunity. A crucial aspect faction is a mediating factor between POS and TI.
that often offers to our employees is a better salary. Future study can be conducted using longitudinal
It is never enough regarding how much money data to give more detail measurement of attitude
should we earned. This is also according to human and behavior which can also increase the accuracy
nature. Interesting offer will move individuals to of the result.To enhance generalization capability, it
strengthen their resources for the future. Company should also be considering the use of more partici-
whether they like it or not has to adjust or at least pants from other service industries such as bank-
not to be far behind in terms of salary offer.To opti- ing, hotel or hospitality, education, financial planner,
mize organization ability to keep high-standing em- and healthcare.
ployees, they need to follow the progress on human
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