ABSTRACT
This study focused on the implication of employee retention and turnover on organizational growth (A Study of Selected Firms in Abia State, Nigeria). The study sought to examine the effect of turnover rate (Vacancy cost, Replacement cost and advertising expenses) on organizational performance of Selected Firms in Abia State, assess the impact of employee retention (Rewards and recognition, Salaries and Promotion) on organizational effectiveness of Selected Firms in Abia State, determine the relationship between employee retention and turnover on organizational growth of Selected Firms in Abia State, explore the impacts of employee retention and turnover strategies adopted on organizational growth of Selected Firms in Abia State and analyze the limiting factors affecting employee retention and turnover on organizational growth of Selected Firms in Abia State. The researcher employed a survey research design. The researcher used primary and secondary sources of data to collect information from the respondents. The total population of the study was 259 management and staff of Nigeria Breweries Aba and Unilever Plc Aba, Abia State. The sample size of 157 was derived from Taro Yamane formula. The simple random sampling method was used to gather information from the respondents. Regression model, Pearson Correlation Coefficient analysis and ANOVA test was used to test the dependent and independent variables of the study. The study found out that Turnover rate (Vacancy cost, Replacement cost and Advertising cost) has a significant difference on organizational performance of Selected Firms in Abia State p-value = .009 < .05% significance level. Employee retention (Rewards and Recognition, Salaries and Promotion) has a significant difference on organizational effectiveness of Selected Firms in Abia State p-value = .005 < .05% significance level. There is a positive relationship between employee retention and turnover on organizational growth of Selected Firms in Abia State p-value = .005 < 0.05% significance level. The study concluded that there is a significant impact on employee retention and turnover strategies adopted on organizational growth of Selected Firms in Abia State p-value = 0.005 < .05% significance level. The study recommended that management under the study should endeavor to reduce the turnover rate of employees to enable them save the vacancy cost and replacement cost and also reduce the cost of train and develop new employees working in the organization.
TABLE OF CONTENTS
Cover Page i
Title
Page ii
Declaration iii
Dedication iv
Certification v
Acknowledgements vi
Table
of Contents vii
List
of Tables viii
Abstract ix
CHAPTER 1: INTRODUCTION
1.1 Background of the Study 1
1.2 Statement of the Problem 6
1.3 Objectives of the Study 7
1.4 Research Questions 8
1.5 Research Hypotheses 8
1.6 Significance of the Study 9
1.7 Scope of the Study 9
1.8 Limitations of the Study 10
1.9 Brief History of the Organization Under
Study 11
1.10 Operational Definition of Terms 12
CHAPTER 2: REVIEW OF RELATED LITERATURE
2.1 Conceptual Framework 14
2.1.1 Employee
turnover and retention 14
2.1.2 Types of employee turnover 18
2.1.3 Effect of employee turnover cost on
organization 19
2.1.4 Strategies that minimize employees’ turnover
and retention 25
2.1.5 Factors affecting employees’ turnover and retention 27
2.1.6 Rewards and job security 37
2.1.7 Determinant of job security 40
2.1.8 Types of rewards systems 46
2.1.9 Training and development and employees’
retention 47
2.1.10 Dimensions
of training and development 49
2.1.11 Benefits of training and development to
employees 50
2.1.12 Work-Life balance 50
2.1.13 Determinants of work-life balance 53
2.1.13 Compensation 55
2.1.14 Impact of employees’ turnover on organization
efficiency 60
2.1.15 Organizational growth 63
2.2 Theoretical Framework 65
2.2.1 Maslow’s hierarchy of needs theory (Abraham Maslow, 1943) 65
2.2.2 Herzberg’s two factor theory (Herzberg,
1959) 66
2.2.3
Equity theory (John Stacey Adam, 1998) 67
2.3 Empirical Review 67
2.4 Gap in Literature 70
2.5 Summary of Reviewed Related Literature 71
CHAPTER 3: METHODOLOGY
3.1 Research Design 73
3.2 Sources of Data 73
3.3 Population of the Study 73
3.4 Sample Size Determination 74
3.5 Sampling Technique 75
3.6 Description of the Research Instrument 75
3.7 Validity of the Research Instrument 75
3.8 Reliability of the Research Instrument 76
3.9 Method of Data Analysis 76
3.10 Model Specifications 76
CHAPTER 4: DATA PRESENTATION AND ANALYSIS
4.1 Return of Questionnaire 78
4.2 Data Presentation 80
4.3 Testing of Hypotheses 85
4.4 Discussion of Results 90
CHAPTER 5: SUMMARY OF FINDINGS, CONCLUSION AND
RECOMMENDATIONS
5.1 Summary of Findings 92
5.2 Conclusion 92
5.3 Recommendations 93
5.4 Areas of Further Studies 93
References
Questionnaire
Appendices
LIST OF TABLES
Table
Page
3.1: Population
Distribution Table 73
3.2: Population
Distribution Table 75
4.1: Return
of Questionnaire 78
4.2: Gender 78
4.3: Experience
78
4.4: Cadre 79
4.5: Qualification 79
4.6: Marital Status 79
4.7: Examine the effect of turnover rate
(Vacancy cost, Replacement cost and advertising 80
expenses) on organizational performance of Selected
Firms in Abia State
4.8: Assess
the impact of employee retention (Rewards and recognition, 81
Salaries and Promotion) on
organizational effectiveness of Selected Firms in Abia State.
4.9: Determine
the relationship between employee retention and turnover on 82
organizational growth of selected
Firms in Abia State.
4.10: Explore the impacts of employee retention and
turnover strategies adopted on 83
organizational growth of selected firms in Abia
State
4.11: Analyze
the limiting factors affecting employee retention and 84
turnover on organizational growth
of Selected Firms in Abia State.
4.12: Regression model on turnover rate on
organizational performance 85
4.13: Regression model on employee retention on
organizational effectiveness 86
4.14: Correlation coefficient model on Employee
Retention and Turnover on 87
Organizational Growth
4.15: ANOVA
test on employee retention and turnover strategies on 88
Organizational
Growth
4.16: Regression model on employee retention and
turnover factors on 89
organizational growth.
CHAPTER 1
INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Employee
Retention and Turnover is one of the important issues within firms competing in
the global market today as employees are the engine hubs in any organization.
Normally it is in a firm’s best interest to put its effort to retain and avoid
losing of the talented employees that they have, and not recruiting or sacking
anyone (Branham, 2005). Organizations all over the world are giving more attention
and importance to this issue as they know that high level employee’s turnover
and retention affects the performance of the employee’s as well as
organization. Besides, it inflates the expenses related to recruiting and
losses of employees as new employees are trained to fit in the organization
areas of specialization (Chen, Lin, & Lien, 2010).
Employee
turnover and retention is a persistent aspect of the global market in the
turbulence environment. Employee turnover and retention influences both firms
and their workers: firms have to incur the expenses on recruiting and training
of new employees, and as well increase the benefits of the workers to keep them
in the organization. However, incoming employees on the other hand may be more
highly skilled and better educated when recruited and while exiting employees
in the organization might like their job which motivates them to stay in the
organization. Therefore, employee turnover and retention may increase
organizational performance, and also provide opportunity which has fascinated the
growth of the organization (Sarah, Gaia, & Christopher, 2007).
Employee’s
turnover and retention issues still exist throughout the world in most of the
organizations. In the most developed business nations, the employee’s turnover
and retention rate is still very high. However, the ability or level of performance
of tasks accomplished by the employees will be achieved only if organization’s
employees are satisfied with the internal environment and it will reduce the
rate at which an employer gains and losses employee (Muhammad, Muhammad, and
Aisha, 2013). Organizational growth is crucial for the success of any economy.
In early theories, organizational growth has been recognized with high
productivity or with the maximization of the profits or with employee good
morale and efficient service. For achieving sustainable and increased business
results, an organization needs to implement good strategy that will engage
their employees to stay and not have the feeling of leaving the firm. For enhancing
organizational growth, business managers need to focus on retaining and maintaining
their employees, the structure that will improve organizational strategy. Thus,
this will lead to high employee retention and low turnover, high financial
performance and high customers’ satisfaction (Muhammad, Sheras, & Mahfooz,
2012).
Furthermore,
employees are more sensitive about their organizations and jobs. Hence, they
try to work hard for their respective departments, making strong relationship
between them and the organization which result in higher organizational growth
(Shumaila and Amir, 2011). Therefore, an organization’s success depends mainly
on employee retention and turnover, which will help the organizations reduce
employee’s job turnover and retain the best employee in the firm towards
increasing organizational growth (Mohsen, 2007).This sector is determined to
develop competitiveness to handle worldwide pressures and customer’s demands. In
this context there are many contributors to this scenario that are significant
to the employee turnover and retention. Such aspects can stem from both the organization
as well as the employees (Izzack, 2010). Most employers are more concerned with
the turnover and less concern with retention as it impacts negatively and a
very expensive aspect of the business world (Thomas,2003).
Martin
(2005) asserted that when employees leave or stay in the company, the employer
has to incur a considerable amount of direct and indirect expense. The costs of
employee turnover and retention can be staggering ranging from consuming quite
a substantial amount of annual wage that an employer would otherwise pay to its
workforce just to keep and prevent them from leaving the firm (Linda, 2002).
The costs of employees’ turnover and retention normally includes; paid holiday,
leaving allowance, awards, promotion and recognition, advertising expenses,
headhunting fees, resource management expenses, loss of time and efficiency,
work imbalance, and employee training and development expenses for new joiners
(Harrie,2002). If the company determines the most common causes of employee
turnover and retention, it would certainly be able to take the necessary steps
for recruiting and retaining well-qualified personnel from losing the job (Armstrong,
2006).
Martin
(2005) posits that a huge concern to most organizations is that employee
turnover and retention is a costly undertaking especially in organizations that
thrives and values viability of the business. Employees’ wages, company
benefits, training and development employee attendance, and job performance has
significant effects on organizational growth (Dessler, 2009). Murphy (2009) opines
that companies take a deep interest in their employee retention and turnover
rate because they both affect the running of the business by creating
disruptions which results to reduced production and profits of the organization
(Anthony, 2006).
These
expenses of employee turnover facing organizations include the cost of training
and development, loss of efficiency, new hires and customer retention.
Depending on the industry, and the job role, the annual wages and salaries
range between 30-200% of a single employer (Trevor, 2004). This is more
impactful on the lower paying jobs and they tend to cost companies less per
replacement of an employee than do higher paying job roles. However, they incur
the cost more often. For these reasons, most companies focus on employee
retention strategies regardless of pay levels (McClelland, 2003).
Oregon
(2004) states that most organizations find that employee retention and turnover
can be curtailed when issues affecting employee’s morale and motivation are
addressed. This is mainly through offering employees benefits such as
reasonable work-life-balance, performance reviews, and performance based
incentives, good working environment, good leadership, along with traditional
benefits such as paid holidays or sick days (Murphy, 2009).The extent to which
a company will go to in order to retain and gain an employee’s depends not only
on employee’s loyalty costs, but also on overall performance of the company
(Phillip, 2009). If a company is not getting the performance it is paying for, employee
replacement cost can be an enormous price to pay in the long run (Bratton,
2003).
Blahna
(2005) reveals that high turnover can be a setback to organizational efficiency,
effectiveness, quality, and profitability of firms of all sizes. Turnover is no
less a problem for major companies, which often spend millions of dollars a
year on turnover-related costs (Miller, 2006). For service-oriented
professions, such as management consulting or account management, high employee
turnover can also lead to customer dissatisfaction and turnover, as clients
feel little attachment to a revolving contact (Brian,2009). Customers are also
likely to experience dips in the quality of service each time their
representative changes (Miller,2006). However, the retention of employees will
also ensure the frequent outputs through products and services (Chew, 2004).
Basically,
according to size of firms, small businesses suffer more because of employees’
high expectation. Now-a-days the employees need and wants to grow every day and
they want more than their salary. As a result employee turnover is increasing.
On the other side the importance of retention become very important for every
organization that wants to survive in a harsh business world (Ming, 2008). In
this approach Kottolli (2010) found out that employee retention tends to
increase organizational performances. Retention also encourages current
employees to remain with the organization. Long term service of employee’s
means they are efficient and effective to their job duties only if they are
well motivated for a job well done.
Fitz-enz
(1997) states that there is significant economic impact when an organization
loses any of its critical employees, especially given the knowledge that is
lost with the employee’s departure. It will become significantly more important
in the years ahead to recognize the commitment of individuals to an
organization, as well as the organization’s need to create an environment in
which one would be willing to stay instead of leaving (Harris, 2000). However,
employee turnover and retention is affected by the organizations external and
internal environmental factors. Increase in demand and better working
conditions for particular skilled labour in the firm, the social and cultural
factors of the environment within which the organization operates are all
external factors that influence employee turnover and retention. Internal
factors such as the organizations structure, reward packages and policies also
affect the employee turnover and retention (Cooper, 2007). Organizations today
should either create an intellectual capital environment where the transmission
of knowledge takes place throughout the structure, or continue to lose
important individual knowledge that has been developed during the length of
service (Njanja, 2013). This deep knowledge is what many believe will help to
meet the needs and expectations of the customers and to create and sustain a
competitive advantage within the global economy in which organizations are
competing in today. This study therefore, empirically examined the implication
of employee retention and turnover on organizational growth (A Study of
Selected Firms in Abia State, Nigeria).
1.2 STATEMENT OF THE PROBLEM
In
recent times many organizations have experienced high rate of employee
turnover, while some manager’s find it very difficult to retain their best work
force. However, employee turnover can be harmful to a company’s efficiency if
skilled workers often leave the organization and the work population contains a
high percentage of novice workers (Armstrong, 2009). The key problem to
employees’ turnover is that the organization loses the most experienced and
skilled staff that the organization had invested heavily in training on various
organization job task functions as a result of unsafe working conditions, noisy
work environment, dissatisfaction, low level of motivation and satisfaction,
poor salary scale, status, job security, poor performance appraisal, supervision
and harsh company policy. On the other hand, moral conduct of some managers in
the company is total absurd where manager of a firm sexually abuses a female
worker, corrupt practices on the high side during promotion and tribalism.
Furthermore, as result of increased level of employees’ retention and turnover
rates, many organizations are found wanting of various employees’ retentions
strategies such as delay of employees’ benefits, decreased remuneration and
offering of various employees rewards, recognitions and awards, even a warm
handshake for a job well done. Also, some managers find it very hard to say
thank you to workers best performance, this however has led to decreased
organization growth and a decline in profit margin.
Another
major concern on the high rate of employee turnover and retention is the
segmentation and delegation of works in the firm, due to short staff nature of
some as a result of non-payment of salaries to employee the work loads are
usually much on those working the firm, some employee carried out two to three
persons duty with little salary accrued to it. Furthermore, assignment of
challenging jobs, achievement, work itself, non-payment of over time, work life
balance and difficult task assigned to workers without proper training, this
greatly degrades the quality of organization services and as result, low level
of customer satisfaction is realized. The organization sales revenue declines
and this lowers the level of organization efficiency.
The
retention and turnover rate of employees has become a major challenge for human
resource managers; they are faced with retention of critical skills, therefore,
talented job candidates have the luxury of choice where he/she selects the kind
of duty they perform in the firm. This is affecting organizations since they
are not only competing with one another but with organizations abroad.
It
becomes problematic for organizations when the rate of replacement rises over
time especially when highly skilled employees are involved. The real challenge
to HR managers therefore lies in devising ways of retaining employees in order
to reduce the rate of turnover and the associated cost. Brown (2006) erevealed
that the lack of proper retention strategies is having an adverse effect on
organizations, as replacing key employees is disruptive, expensive, time
consuming and even threaten the sustainability of an organization. The challenge
for most organizations today is the formulation of effective employee retention
strategies that will help in retaining employees that are considered critical
in attaining organizational goals. Employees who are highly motivated,
committed and engaged are more likely to stay longer on the job than those who
are bored and dejected. It is against this background that this study,
empirically is examining the implication of employee retention and turnover on
organizational growth (A Study of Selected Firms in Abia State, Nigeria).
1.3 OBJECTIVES OF THE STUDY
The
main objective of this study is to examine the
implication of employee retention and turnover on organizational growth (A
Study of Selected Firms in Abia State, Nigeria). Specific objectives are to:
i.
examine the effect of turnover
rate (Vacancy cost, Replacement cost and advertising expenses) on
organizational performance of Selected Firms in Abia State.
ii.
assess the impact of employee
retention (Rewards and recognition, Salaries and Promotion) on organizational
effectiveness of Selected Firms in Abia State.
iii.
determine the relationship
between employee retention and turnover on organizational growth of Selected
Firms in Abia State.
iv.
explore the impacts of employee
retention and turnover strategies adopted on organizational growth of Selected
Firms in Abia State.
v.
analyze the limiting factors affecting
employee retention and turnover on organizational growth of Selected Firms in
Abia State.
1.4 RESEARCH QUESTIONS
i.
What is the effect of turnover
rate (Vacancy cost, Replacement cost and Advertising cost) on organizational
performance of Selected Firms in Abia State?
ii.
What is the impact of employee
retention (Rewards and Recognition, Salaries and Promotion) on organizational
effectiveness of Selected Firms in Abia State?
iii.
What is the relationship
between employee retention and turnover on organizational growth of Selected
Firms in Abia State?
iv.
What are the impacts of
employee retention and turnover strategies adopted on organizational growth of
Selected Firms in Abia State?
v.
What are the limiting factors affecting
employee retention and turnover on organizational growth of Selected Firms in
Abia State?
1.5 RESEARCH HYPOTHESES
Ho1: Turnover rate (Vacancy cost, Replacement cost and Advertising cost)
has no significant difference on organizational performance of Selected Firms
in Abia State
Ho2: Employee retention (Rewards and Recognition, Salaries and
Promotion) has no significant difference on organizational effectiveness of
Selected Firms in Abia State.
Ho3: There is no positive relationship between employee retention and
turnover on organizational growth of Selected Firms in Abia State.
Ho4: There is no significant impact on employee retention and
turnover strategies adopted on organizational growth of Selected Firms in Abia
State.
Ho5: Employee retention and turnover factors do not affect
organizational growth of Selected Firms in Abia State.
1.6 SIGNIFICANCE OF THE STUDY
Non-Governmental Organizations (NGOs)
The study will be of great significance to the all NGO’s and all
organizations since it was highlighted some of the critical challenges
hindering increased growth of organizations of any kind. Organizations through various
stake holders hence facilitate development of operational policies that
influence increased rate of staff retention and turnover in the organization.
Firms/Organization
The
findings of this study will be of great significance to firms/organizations in
the country since by using the analyzed results, human resource managers in all
organizations will be in a better position to understand the causes of employee
turnover rates and be conversant with the best staff retention strategies to manage
high staff turnover rates.
Managers
The
outcome of such a study will help managers to have a better understanding about
the importance of employee’s retention and turnover rate and to formulate
policies and strategies to arrest such intentions.
Government
The
research study will be valuable tool to the government in understanding the
influence of employee retention and turnover on organizational growth of
Selected Firms in Abia State, Nigeria. This helped in coming up with policies
and also come up with decision making and implementation processes of the
policies related to employee retention and retention.
Researchers and Academic
This research work will equip the academic and researchers with
more knowledge and skills on the impact employee turnover and turnover. The
study further will make a myriad of contributions to the literature on employee
turnover and retention which was part of articles useful by researchers who
want to further this study and to other wider stakeholders in the academic
circles.
1.7 SCOPE OF THE STUDY
This
study examined the implication of employee retention and turnover on
organizational growth (A Study of Selected Firms in Abia State, Nigeria). Unit
Scope confined two manufacturing firms in Abia state, Unilever Plc and Nigeria
Breweries Company.
Content
scope attempted to examine the effect of turnover rate (Vacancy cost,
Replacement cost and advertising expenses) on organizational performance of
Selected Firms in Abia State, assess the impact of employee retention (Rewards
and recognition, Salaries and Promotion) on organizational effectiveness of
Selected Firms in Abia State, determine the relationship between employee
retention and turnover on organizational growth of Selected Firms in Abia State,
explore the impacts of employee retention and turnover strategies adopted on organizational
growth of Selected Firms in Abia State and analyze the limiting factors
affecting employee retention and turnover on organizational growth of Selected
Firms in Abia State.
1.8 LIMITATIONS OF THE STUDY
The
limitations for the completion of this work were based on the difficulty the
researcher encountered while trying to get information in the study area.
Some of
the most important ones include:
Most
workers or highly place employees of the selected firms were reluctant to give
out the needed information because according to
them, those were classified information and some respondents were biased and
dishonest in their answers considering that they were all commenting on their
employer. Most of the staffs especially
the lower level managers where ignorant of what the study was all about; it was
a challenge to collect information from them, which caused the researcher to
break down the context of the study to them before getting little information
from them. Since the study involved was
more than one firm, the researcher finds it very difficult moving from one firm
to another trying to retrieve the administered questionnaire due to
insufficient fund for transportation and to conduct statistical analysis. The
job nature of the researcher did not permit the researcher to frequent the
selected firm, however, some of the respondents assisted the researcher in completing
the questionnaire and also assisted in collecting the questionnaire from their
fellow respondents.
1.9 BRIEF HISTORY OF ORGANIZATION UNDER THE
STUDY
Nigeria Breweries Plc
Nigerian
Breweries Plc, the pioneer and largest brewing Company in Nigeria was
incorporated in 1946. In June 1949, the Company recorded a landmark when the
first bottle of STAR lager beer rolled off its Lagos Brewery bottling lines.
This first brewery in Lagos has undergone several optimization processes and as
at today boasts of the most modern brew house in the country.
In
1957, the Company commissioned its second brewery in Aba. This was followed by
Kaduna Brewery in 1963 and Ibadan Brewery in 1982. In 1993, the Company
acquired its fifth brewery in Enugu and in 2003, a sixth brewery (Ama Brewery),
sited at Amaeke Ngwo in Enugu State was commissioned. Ama Brewery is today, the
biggest brewery in Nigeria. Operations in the old Enugu Brewery were discontinued
in 2004 following the completion of Ama Brewery. An ultra-modern malting plant
was acquired in Aba in 2008.
In
October 2011, the Company acquired majority equity interest in Sona Systems
Associates Business Management Limited (Sona Systems), with two breweries in
Ota and Kaduna, and Life Breweries Company Limited (Life Breweries) with a
brewery in Onitsha. Sona Systems and Life Breweries were merged into an
enlarged Nigerian Breweries in the middle of 2012. Another malting plant was
acquired in Kaduna as a result of the acquisitions/mergers.
Thus,
from the humble beginning in 1946, the Company now has eight operational
breweries from which its high quality products are produced and then
distributed to all parts of Nigeria, in addition to the two malting plants in
Aba and Kaduna. It also has Sales Offices across the country.
Nigerian
Breweries Plc has a rich portfolio of high quality brands: Star lager
beer was launched in 1949, followed by Gulder
lager beer in 1970. Maltina,
the nourishing malt drink, was introduced in 1976, followed by Legend Extra Stout in 1992 and Amstel Malta in 1994. Heineken lager beer was re-launched
into the Nigerian market in 1998. Maltina
Sip-it, packaged in Tetrapaks was launched in 2005, while Fayrouz, the premium non-alcoholic
soft drink, was launched in 2006. Climax,
a herbal energy drink was launched in 2010. Following the acquisition of Sona
Systems and Life Breweries in 2011, Goldberg
lager, Malta Gold and Life Continental lager, were added to
the brand portfolio.
The
Company has an increasing export business that dates back to 1986. The current
export destinations are the United Kingdom, European Union and the West African
sub-region.
As
a major brewing concern, Nigerian Breweries Plc encourages the establishment of
ancillary businesses. These include manufacturers of bottles, crown corks,
labels, cartons, plastic crates and service providers such as hotels/clubs,
distributors, transporters, event managers, advertising and marketing
communication agencies amongst others.
The
Company was listed on the floor of The Nigerian Stock Exchange (NSE) in 1973.
As at 31st December, 2012, it had a market capitalisation of N1.1 trillion,
making it the second largest company in Nigeria. It has consistently been
honoured with awards relating to capital market matters including amongst
others, The NSE President’s Merit Award in the Brewery Sector and the NSE
Quoted Company of the Year Award. In 2012, the Company was recognised as the
most compliant company amongst those listed on the Nigerian Stock Exchange when
it won The NSE CEO’s Distinguished Award (Compliance) for Listed Companies.
Nigerian
Breweries Plc is also a recipient of many other awards for its operations and
high-quality brands.
Mission
Statement
“To be the leading beverage company in Nigeria,
marketing high quality brands to deliver superior customer satisfaction in an
environmentally friendly way’’
Vision
“To be a World-Class Company”
Core
Values
Respect; Passion for Quality; Enjoyment and Performance
Unilever Plc
Unilever
history in Nigeria dates back to 1923 when Robert Hesketh Leverhulme opened a
trading post in Nigeria under the business name, Lever Brothers (West Africa)
Ltd. The firm was primarily engaged in trading of soap and in 1924, the name
was changed to West African Soap Company. Sensing opportunity in the
country, the firm opened a soap factory in Apapa in 1925.
The company later expanded into the production of food products, it opened a
new soap factory in Aba in 1958 and changed its name to Lever
Brothers Nigeria Limited in 1955. In 1960, Lever Bros introduced Omo detergent
into the market, the new product gained traction among buyers, prompting the
firm to commission a factory to manufacture Omo detergents in 1964.
In
compliance with the indigenization decree of 1972,
Unilever became a publicly listed company in 1973, selling 60% of its shares to
the Nigerian public. The company became majorly Nigerian owned. The change in
equity ownership did not dent the firm's growth. In 1982, the firm began
producing edible products such as Royco, blue band and tree top in
Agbara, Ogun State. In addition, the company went through a
period of mergers and acquisition, firstly, acquiring Lipton Nigeria in 1985
and later merging with Vaseline manufacturer, Chesebrough Products Industries
in 1988. During this period, the company embarked on a backward integration scheme in order to
source its raw materials locally. This business decision led the company to
invest in crop production and oil palm milling. The company also invested in a
tea plantation in Mambilla to provide raw materials for lipton.
In 1995, Lever Brothers, 40% owned by Unilever merged with Unilever Nigeria
Limited, a subsidiary of the Unilever U.K. The merger gave Unilever control of
the newly merged entity, this was the first time since the indigenisation
decree was scrapped that a multinational will have majority equity in a quoted
Nigerian company. In 2001, the company changed its name to Unilever
Nigeria Plc.
Goals
Improving
Health and well-being for more than 1Billion
Reducing environmental impact
by half
Enhancing Livelihoods for millions
Vision
Together
we can change the way the world does business
Mission Statement
At Unilever we
meet everyday needs for nutrition, hygiene and personal care with brands that
help people feel good, look good and get more out of life
1.1.0 OPERATIONAL DEFINITIONS OF TERMS
Employee Retention:
Is the organizational goal of keeping talented employees and
reducing turnover by fostering a positive work atmosphere to promote
engagement, showing appreciation to employees, and providing competitive
pay and benefits and healthy work-life balance
Employee Turnover: Employee
turnover refers to the rate at which an employer losses employees. Employee
turnover is the most important activity of human resource of a firm in which
management is eager to censure.
Motivation: Motivation is
defined as a psychological force that determines the direction of a person's
behavior in an organization, a person's level of effort and a person's level of
persistence.
Replacement cost
or replacement value refers to the amount that an entity would have to pay to
replace an asset at the present time, according to its current worth.
Advertising costs
are a type of financial accounting that covers expenses associated with
promoting an industry, entity, brand, product, or service. They cover ads in
print media and online venues, broadcast time, radio time, and direct mail
advertising.
Rewards and Recognition
is a system where people are acknowledged for their performance in
intrinsic or extrinsic ways. Recognition & Reward is present in a work
environment where there is appropriate acknowledgement and appreciation of
employees' efforts in a fair and timely manner.
Salary
is a form of periodic payment from an employer to an employee, which may be
specified in an employment contract.
Promotion
refers to any type of marketing communication used to inform target audiences
of the relative merits of a product, service, brand or issue, most of the time
persuasive in nature.
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