Predictive models of employee voluntary turnover in a North American professional sales force using data-mining analysis

Abstract

With the supply of talented employees for the predicted available jobs around the world declining, employee retention and voluntary turnover have jumped to the forefront of HRD practitioners’, as well as senior managers’, strategic initiative. By 2008, demographers predict that 76 million baby boomers will be eligible for retirement. The generations that followed these individuals, born between 1946 and 1962, are not numerically adequate to fill the vacancies that these retirements will create. A growing concern exists that the expected annual growth in the number of eligible employees will be outpaced by economic growth predictions. While employee retention and employee voluntary turnover have received considerable scholarly attention, few research studies have examined the phenomenon in a professional sales arena. No investigation to date has tracked employee voluntary turnover and retention over a 14-year longitudinal wave as was the focus of this study. This population study examined employee retention of a Fortune 500 North American industrial automation manufacturer’s professional sales force over a 14-year period. It focused on personal characteristics, work characteristics, and human resource development (HRD) intervention factors influencing employee voluntary turnover. The results suggest that training and development participation contributes more significantly to employee retention than salary and job title promotions to the firm’s ability to retain sales professionals. The theoretical underpinnings associated with these findings reinforce the importance of human capital theory, social identity theory, expectancy theory, and distributive justice theory. They also suggest that employee retention should be included in calculations that measure the return on investment for training and development interventions. Further, these results that emerged from comprehensive data mining suggest that a structured training and development program embeds aspects of employee socialization that can influence a professional sales employee’s tenure in the organization. Formal training can serve to socialize the employee into the organization, thus, deepening the effect of social capital theory to build normative organizational commitment, a mediator of employee retention. This effect appeared to be more significant for non-Caucasian sales professionals who remained in the organization when included in a structured sales training program.