Decision-theoretic utility analysis applied to employee separations and acquisitions.

A decision-theor etic utility model that describes the consequences of employee movements out of and into the organization (separations and acquisitions) is presented. The model is developed for three types of employee movement: (a) repeated acquisitions without separations, (b) repeated unreplaced separations over time, and (c) repeated separations over time that are replaced with new employees. The latter model is the most general case, and provides an explicit link between separation utility and existing selection utility models. In addition to a conceptual and algebraic model development, a computer algorithm is developed and used to provide a numerical simulation. The results strongly suggest that decisions about employee separations can substantially affect the utility of human resources. Literature-based implications for future selection and turnover research are presented.

[1]  D. R. Dalton,et al.  Turnover turned over: an expanded and positive perspective. , 1979, Academy of management review. Academy of Management.

[2]  D. R. Dalton,et al.  Functional Turnover: An Empirical Assessment. , 1981 .

[3]  Madhav V. Rajan,et al.  Cost Accounting: A Managerial Emphasis , 1972 .

[4]  M. Abelson,et al.  Optimal and dysfunctional turnover: toward an organizational level model. , 1984, Academy of management review. Academy of Management.

[5]  Lyman W. Porter,et al.  Perspectives on behavior in organizations , 1977 .

[6]  H. E. Brogden,et al.  On the interpretation of the correlation coefficient as a measure of predictive efficiency. , 1946, Journal of educational psychology.

[7]  J. Arnold,et al.  Validation and utility of a strength test for selecting steelworkers. , 1982 .

[8]  Keith B. Ehrenreich,et al.  Cost/benefit analysis of human resource accounting alternatives , 1976 .

[9]  John E. Hunter,et al.  Task Differences as Moderators of Aptitude Test Validity in Selection: A Red Herring , 1981 .

[10]  F. Schmidt,et al.  ASSESSING THE ECONOMIC IMPACT OF PERSONNEL PROGRAMS ON WORKFORCE PRODUCTIVITY , 1982 .

[11]  John W. Boudreau,et al.  Economic considerations in estimating the utility of human resource productivity improvement programs. , 1983 .

[12]  Philip Bobko,et al.  Estimation of standard deviations in utility analyses: An empirical test. , 1983 .

[13]  J. Boudreau.  A conceptual model of employee movement utility , 1981 .

[14]  Wayne F. Cascio,et al.  Utility of the assessment center as a selection device. , 1979 .

[15]  Dan R. Dalton,et al.  Turnover: A Lucrative Hard Dollar Phenomenon , 1982 .

[16]  Cynthia M. Pavett,et al.  TURNOVER AMONG NURSES: IT CAN BE MANAGED , 1978 .

[17]  Richard M. Steers,et al.  Organizational, work, and personal factors in employee turnover and absenteeism. , 1973 .

[18]  John W. Boudreau,et al.  Role of recruitment in staffing utility analysis. , 1985 .

[19]  F. Schmidt,et al.  Ability Tests: Economic Benefits Versus the Issue of Fairness , 1982 .

[20]  C W Mueller,et al.  A causal model for turnover for nurses. , 1981, Academy of Management journal. Academy of Management.

[21]  J. Hunter,et al.  Validity and Utility of Alternative Predictors of Job Performance , 1984 .

[22]  William H. Mobley,et al.  Some Unanswered Questions in Turnover and Withdrawal Research , 1982 .

[23]  F. Schmidt,et al.  Individual differences in productivity: An empirical test of estimates derived from studies of selection procedure utility. , 1983 .

[24]  J. Boudreau.  Effects of employee flows on utility analysis of human resource productivity improvement programs. , 1983 .

[25]  Michael J. Burke,et al.  Two modified procedures for estimating standard deviations in utility analyses. , 1984 .

[26]  Frederick J. Gaudet,et al.  Labor turnover : calculation and cost , 1960 .

[27]  V. Vroom.  Work and motivation , 1964 .

[28]  H. L. Smith,et al.  Managing manpower turnover costs. , 1978, The Personnel administrator.

[29]  J. C. Naylor,et al.  A table for determining the increase in mean criterion score obtained by using a selection device. , 1965 .

[30]  Randall S. Schuler,et al.  Applied readings in personnel and human resource management , 1981 .

[31]  G. Dreher.  The Role of Performance in the Turnover Process , 1982 .

[32]  F. Schmidt,et al.  Contemporary problems in personnel , 1983 .

[33]  John E. Hunter,et al.  Impact of valid selection procedures on work-force productivity. , 1979 .

[34]  J. F. Byrnes,et al.  Costing Human Resources: The Financial Impact of Behavior in Organizations , 1984 .

[35]  Robert P. Vecchio,et al.  Mobley, W. H., Griffeth, R. W., Hand, H. H., & Meglino, B. W. 1979. Review and conceptual analysis of the employee turnover process. Psychological Bulletin, 86: 493-522. , 1985 .

[36]  Charles W. Mueller,et al.  Job performance and turnover. , 1981 .

[37]  J. Boudreau.  Utility Analysis Models for Productivity Improvement Programs Affecting Work Group Composition. , 1984 .

[38]  John W. Boudreau,et al.  Decision Theory Contributions to HRM Research and Practice , 1984 .

[39]  William H. Mobley,et al.  Employee turnover : causes, consequences, and control , 1983 .

[40]  R. Jacobs,et al.  Utility concepts in performance measurement , 1982 .

[41]  Barry M. Staw,et al.  The consequences of turnover , 1980 .

[42]  Hubert E. Brogden,et al.  When Testing Pays Off , 1949 .

[43]  J. W. Walker,et al.  Human resource planning , 1980 .

[44]  Bernard M. Bass,et al.  FURTHER EVIDENCE ON THE DYNAMIC CHARACTER OF CRITERIA , 1962 .

[45]  W. Mobley,et al.  Review and Conceptual Analysis of the Employee Turnover Process , 1979 .