Case: HBAT Employee Retention

HBAT employs thousands of workers in different operations around the world. Like many firms,
one of its biggest management problems is attracting and keeping productive employees. The
cost to replace and retain employees is high. HBAT management would like to understand the
factors that contribute to employee retention. A better understanding can be gained by learning
how to measure key constructs. Thus, HBAT is interested in developing and testing a
measurement model made up of constructs that affect employees’ attitudes and behaviors about
remaining with HBAT. To conduct the study, HBAT hired consultants with a working
knowledge of the organizational behavior theory dealing with employee retention. Based on
published literature and some preliminary interviews with employees, a study was designed
focusing on five key constructs. The consulting team and HBAT management also agreed on
construct definition based on how they have been used in the past. The five constructs along with
a working definition are as follows:

Job Satisfaction (JS): Reactions resulting from an appraisal of one’s job situation.

Organizational Commitment (OC): The extent to which an employee identifies and feels part of
HBAT.

Staying Intention (SI): The extent to which an employee intends to continue working for HBAT
and is not participating in activities that make quitting more likely.

Environmental Perceptions (EP: Beliefs an employee has about day-to-day, physical working
conditions.

Attitude Toward Coworkers (AC): Attitude an employee has toward the coworkers he/she
interacts with on a regular basis.

The consultants proposed a set of multi item reflective scales to measure each construct. The
scale is produced in Annexure I. Data were collected from 400 employees of each HBAT’s
divisions. The data were presented in SPSS file named ………….. HBAT_CFA.sav

This material is based on the example discussed in the book: Multivariate Data Analysis
authored by Hair, Black, Babin and Anderson.