Toward understanding the relationship between IT human resource management systems and retention

Abstract

Organizations design their human resource management (HRM) systems to achieve a variety of goals such as developing and retaining employees, increasing productivity, and enhancing overall firm performance. However, the mechanisms through which HRM systems exhibit these effects are less understood. The focus of this work is on illuminating the relationship between HRM systems and one important organizational outcome: employee retention, in the context of the IT function. We ask the question Does an HRM system have an effect on the intentions to stay of IT professionals? Arguments in support of this relationship are developed from two different theoretical perspectives: the rational HRM system view and the behavioral or enacted HRM system view. We apply these perspectives at different levels of analyses with multiple measurement approaches to field data collected from over 350 IT professionals in 10 organizations. Results show that, in general, the enacted HRM system perspective explains greater variance in intentions to stay. The group and individual levels of analysis offer more explanatory power than the organizational level of analysis, and indirect measures of HRM systems explain intentions to stay better than direct measures. Theoretical and pragmatic implications of the findings are presented.