High employee turnover rate has been considered as one of the highest drivers for direct and chance cost to lift for companies. In the Coca Cola Retailing Research. Blake ( 2000 ) estimates that about US $ 5. 8 billion yearly are lost in the supermarket sector entirely due to employee turnover. More significantly. this figure significantly reduces the profitableness of houses to every bit much as 40 % . Hence. the mantra that human resources or people are still the most of import factor of production sing the betterments in engineering is still a prevailing impression among bookmans and business communities likewise ( Buckingham and Vosburgh. 2001 ) .

With this in head. human resources direction is driven to pull and retain employees that have proved valuable in the company over periods of clip. Basically. employee keeping and the decrease of employee turnover rate had been studied in the literature and in company instance surveies. However. despite the legion surveies provided to us. there are still debates that demand to be resolved on the most powerful factors that would do employees remain.

This paper presents a instance survey of Coca Cola Company peculiarly its plan on employee keeping. the issues and challenges that it faces in footings of employee turnover. its impact on the company both financially and operationally. and the betterments that can be made in order to heighten the employee keeping plan and cut down turnover rates. Employee Retention: Factors and Drivers Employee keeping on a macro-scale had by and large been impacted by the external economic system in general and the tendencies in the concern sector ( Frank and Taylor. 2004 ) .

On a micro-scale nevertheless. employee keeping are affected by programs/policies of the company. rewards and benefits in relation to its rivals. accomplishments. preparation and publicity. employee motive and satisfaction every bit good as other factors that are internal to the company. For case. while the US economic system had been considered at a low degree in recent old ages. employee turnover had been maximal in the periods 2002-2003 because of the retrenchment that had been prevalent in US companies.

Add to this factor. employee discontent harmonizing to the study of the Conference Board ( 2003 ) had been highest since 1995 and that employees are merely waiting for a market recovery to look for other occupations ( Kaihla. 2003 ) . Hence. aside from these factors that needs to be considered by companies. employee turnover affects the cost of the US economic system by at least US $ 5 trillion yearly ( Journal of Business Strategy. 2003 ) and reduces stock monetary values and net incomes to approximately 38 % ( Sibson. 2000 ) .

Consequently. aside from the fiscal impact of employee turnover. employee keeping has been straight correlated by Dresang ( 2002 ) to increase productiveness every bit good as client trueness. Employee keeping had been attributed to several factors ; allow us foremost analyze the factors identified in the literature to lend employee keeping and decrease of turnover. In Coca Cola. the top keeping drivers between hourly employees and direction employees were identified as follows.

For the hourly employees. supplying waies. handiness of equipment and supplies and immediate supervising were identified as drivers for keeping while for directors. it would be organisational way. preparation and promotion ( Frank. 2000 ) . These factors validate earlier surveies that front-line leaders play a critical function in the keeping of employees ( SHRM Retention Survey. 2000 ) . This is because hapless direction would drive employees off because of their sensed deficiency of importance accorded to them by the company.

Consequently. this consequence implies that directors being critical factors in employee keeping would necessitate to be improved in footings of preparation and professional development plans by the company ( Gantz Wiley Research. 2004 ) . Hence. Frank ( 2000 ) asserted that organisational and direction patterns as drivers for keeping have specific and identifiable ends. First. for employees working by the hr. tactical patterns in carry throughing their occupations efficaciously are considered to be of import.

This is because these employees derive their satisfaction and motive from the feedback that they receive from their immediate supervisors. Hence. their executing of their specific undertakings is of import in order to do them experience of import in the company. However. direction keeping had been attributed to the strategic way of the company every bit good as their professional preparation and promotion. This implies that directors are more likely to remain in a company with a preparation plan that would promote professional growing every bit good as a plan with concrete publicity guidelines.

Coca Cola Employee Retention Program Coca Cola. the taking maker of carbonated drinks had been considered as one of the top employers non merely in footings of supplying 100s of occupations worldwide but besides in strategically pull offing its employees turn over rate. The protagonism of Coca Cola rests on the productiveness and accomplishments of its employees in supplying quality merchandises and guaranting quality control of its ware.

In return. Coca Cola incorporates in its nucleus policies the Workplace Rights Policies which includes a holistic position of its workers guaranting that its policies serves up to the publicity of a holistic employee growing ( The Coca Cola Company. 2008 ) . Unlike PepsiCo. Coca Cola allows brotherhoods and provides for a corporate bargaining in order to protect the rights of its employees. This has led to the unorganization of the employees of PepsiCo compared to that of Coca Cola- while there is a high degree of corporate bargaining in Coca Cola. PepsiCo has non provided its employees the locale to aerate its grudges.

However. compared to PepsiCo’s Taste to Success employment trade name statement and its legion plans for employee keeping such as “Culture of Shared Principles” . “Ability to Make an Impact” . “Quality People” and “Passion for Growth” . Coca Cola’s run for employee keeping is still in the procedure of germinating. For one. the 2000 research employed by Coca Cola to find the cost and the chances for employee keeping. the company had redeveloped its corporate scheme to specifically turn to its direction and rank and file keeping issues by altering its scheme.

For case. Coca Cola has the “talent magnets” plan in jubilation of directors who are able to pull outstanding endowments in their squad. This is done by Coca Cola in order to supply promotion non merely for directors but for rank and file employees every bit good. Consequently. Coca Cola in its mission statement includes four constituents bespeaking the duty of directors to develop the rank and file employees.

For illustration. in Coca Cola’s Competency/Success Model. it targets the ego and others. rank and file employees would supply the necessary feedback on their director sing their development success and compensation based on their accomplishments. Based on these standards. the directors are so judged by upper direction ( Olian. et Al. 1998 ) . Hence. the focal point of Coca Cola is on squads and non on persons entirely. This is similar to the patterns in PepsiCo but to a lesser extent. For case. PepsiCo still values single accomplishment and accomplishments in its publicity and promotion.

In footings of compensation and wage. both PepsiCo and Coca Cola had been criticized by foreign states by supplying below flat compensation for employees. In the United States. typically. the pay of same degree employees is the same for both. Consequently. the benefits for regular and portion clip employees are comparable with one another. Furthermore. both companies provide developing and development plans. diverseness and multi-cultural work environment every bit good as plans for promotion. However. the primary difference is that Coca Cola had been considered to basically more sound strategically than that of PepsiCo.

For case. while PepsiCo offers different assortment of merchandises in the drink and bite sector and hold declared bankruptcy in the yesteryear. Coca Cola’s sound direction basicss have prevented it from puting in hazardous ventures. While both PepsiCo and Coca Cola had been fraught with workers issues peculiarly in low wages and rewards every bit good as the issues of better rights for workers. Coca Cola had fared good better in retaining its employees because it is more stable than PepsiCo ( which had closed 4 workss in New Jersey ) and because of the presence and tolerance of brotherhoods.

To a big extent. brotherhoods in Coca Cola had perennially protected the rights of its workers and hence. led to lower employee turnover in Coca Cola. Valid and Effective Employee Retention Program Employee keeping plans while it should see external facets of its operations such as the economic public presentation of the state. the rewards and salary in that specific state every bit good as competition. internal factors within the human resource sector would besides needed to be re-examined peculiarly in finding the agencies to retain employees.

It should be noted that adept employees and directors are considered to be cherished and scarce trade goods in today’s employment universe. This is the ground why companies such as Coca Cola militias wagess for its top performing artists in merchandising and marketing its merchandises. For case. those who have shown superior public presentation than others are given calling promotions readily. preparations and professional development growings are available and they have better dickering power.

Hence. these workers can demand for better work conditions peculiarly in equilibrating their work-family life. This nevertheless. does non merely use for directors but besides for rank and file employees. While precedences would differ for the two categories. the demand to be valued by the organisation is of import. This is manifested in footings of wage and rewards. benefits. publicities. promotion. work status every bit good as the demand to cognize their function in the organisational mission.

Hence. employee keeping plans should concentrate on the internal and external factors of employees: wage. benefits and publicity every bit good as the working dealingss of the employees on their immediate higher-ups and colleagues every bit good as in supplying a better consideration for themselves as a individual and non merely a worker. For case. feedback from the director are of import considerations from rank and file employees ( Frank. 2000 ) connoting that it is no longer the wage and compensation that affairs for keeping but besides on the relationship of subsidiaries to higher-ups.

Hence. plans on employee keeping should concentrate on managers’ ability to better their subsidiaries and drive their squad to accomplish. This would connote that promotions would besides concentrate on the ability of the directors to develop and better the place and compensation of their employees. Finally. the ability of companies such as Coca Cola to supply a better balance in the life of the employees by supplying chances for better working conditions such as work-life balance can better the trueness of the employees every bit good as heighten their productiveness ( Younger. Smallwood and Ulrich. 2007 ) .

Method in Determining Effective Employee Retention Program The Coca Cola Study had proposed 13 ( 13 ) graduated tables for direction and organisational patterns that can function as a benchmark in measuring the employee keeping plan: 1 ) organisational way ; 2 ) immediate supervising ; 3 ) providing waies ; 4 ) supplying feedback ; 5 ) equipment and supplies ; 6 ) working conditions ; 7 ) work organisation ; 8 ) wage disposal ; 9 ) wage and benefits ; 10 ) promotion ; 11 ) impact ; 12 ) preparation ; and 13 ) capacity ( Frank. 2000 ) . These graduated tables serve as a benchmark in measuring current employee keeping plans in Coca Cola.

Consequently. these factors would be critically assessed in the following subdivision utilizing the Coca Cola survey in order to find the countries where Coca Cola had improved since the survey was completed in 2000 and the countries that would necessitate betterment. It should be noted that this graduated table system is specific to supermarket merchandises and may non reflect with other companies. Discussion and Recommendations for Effective Employee Retention Program in Coca Cola Traditional construct on employee keeping had been that: increase the wage and employees will remain.

However. in current concern environment where skilled workers are offered with legion occupation offers. the range of employee keeping had besides broadened. First. employees now consider the organisational way of the company. As shown in the study of Coca Cola. organisational way is of import for directors in order to find their ends in line with that of the company. A company with good cardinal organisational ends is more likely to retain directors who align themselves within the organisational way. However. this is non merely the instance for directors as implied in the 2nd factor which is immediate supervising.

Directors and supervisors are tasked with the demand to better on the quality of its supervisory capacity in order to retain rank and file employees. In Coca Cola. directors who are in charge of a squad are judged non on their single public presentation but on how the squad had performed. Hence. effectual supervising and direction are critical in finding the success of employees both in the managerial every bit good as the rank and file degree. The rule is no longer that directors will lift entirely but instead. rank and register employees will lift alongside their director.

This is besides the nucleus policy of Coca Cola’s ego and others plan wherein one is non merely responsible for his or her ego but for the squad every bit good. Third. supplying waies is no longer the monopoly of supervisors and directors. Typically. the perpendicular or line hierarchy within concern houses had been replaced by horizontal and a more synergistic workplace. Rank and file employees now have the freedom for better independency every bit good as in supplying input to the direction. In Coca Cola. this is no longer prohibited but is encouraged in order to derive fresh and better penetrations to better on public presentation.

The rule behind this is that those who do the work are better equipped with the cognition on how to better it. Along this line is the acknowledgment that rank and file employees can supply way to the organisation as good which is the 4th factor in the item- providing feedback. The feedback system in Coca Cola does non rest entirely on the discretion of the directors but besides on the records of the employee. However. the feedback given by the immediate supervisors are of import in finding the capacity and accomplishments every bit good as the importance accorded to an employee.

At Coca Cola. since squads are driven to bring forth. supervisors and directors can supply immediate feedback. Positive feedback gives the sense of achievement for employees every bit good as the feeling that they are valued members of the organisation. This in kernel. additions employee motive and satisfaction. The fifth and 6th factors include handiness of equipments and supplies every bit good as working conditions of the employees. It should be noted that in order to carry through a undertaking. stuffs necessary would hold to be available.

For rank and file employees. the direction that ensures that these stuffs are available is tantamount to the perceptual experience that the work they accomplish is of import in the organisation. This leads us to the 6th factor which is working status. The work environment has been considered as one of the more of import determiner of employee motive and hence. employee keeping and turnover. Those employees whose work is non recognized are more likely to be unmotivated. Coca Cola for its portion has better working conditions than PepsiCo.

However. working conditions outside of the United States would necessitate to be improved because of their hapless managerial and works support. In the United States. these issues are less pressing. Therefore. it is the duty of the top direction to guarantee that despite the demand of workers in 3rd universe states of work. its betterment would cut the rate of employee turnover and increase the possibility of keeping. Seventh. one good manner to better employee keeping is for the Coca Cola direction to utilize a motto that will function as the company’s end similar to that of PepsiCo.

Many corporations use the motto. “People are our most of import plus. ” Similarly. many companies contend that their values back up teamwork. unity. regard. and self-respect. While this may sound good. it takes difficult. consistent work in policies. statements and actions for employees to believe it. Eight. the authoritative wage doctrine is to supply rewards that will pull and retain qualified employees. Bing cognizant of the pay rates in an organization’s external market topographic point is critical to Coca Cola’s success for retaining employees.

The instance of the Coca Cola’s pay graduated table is low ; the company has already lost employees to other sectors that pay a higher rate. Hence. there is a demand for betterments in the compensation by bettering on public presentation wages. For case. lump sum virtue awards on the other manus provide fiscal acknowledgment for an individual’s occupation public presentation in stead of merit-based salary additions. This is an effectual manner to supply fiscal acknowledgment. particularly to those persons whose base wage is already comparatively high.