Investigating the turnover of middle and senior managers in the pharmaceutical industry in South Africa

Abstract

Orientation: Today, knowledge is a commodity and thus skilled knowledge workers, particularly in management positions, are vital for organisations’ success; their increased turnover has an adverse effect on productivity and profitability. High staff turnover is a cause for alarm, not only because of the costs associated with recruitment, selection and training, but also due to the increasing scarcity of experienced talent.Research purpose: This research investigates the reasons for the turnover of middle and senior managers in the pharmaceutical industry in South Africa in order to identify the possible reasons and formulate solutions to address the issue.Motivation for the study: In South Africa, employment, retention and turnover occur against the backdrop of a history of discrimination and inequality and attempts by government and organisations at redress. The significance of this background cannot be underestimated.Research approach, design and method: This study was qualitative and inductive to allow dominant themes to emerge from the raw data. Data was collected through in-depth, semi-structured one-on-one interviews as well as a review of company turnover reports and employment equity reports.Main findings: The study found that in the sampled organisations, employee turnover averaged almost 22% per annum between 2007 and 2010. Reasons for the turnover include a range of industry, company and personal factors.Practical/managerial implications: The overall turnover rate remains high, particularly amongst black knowledge workers, the attraction, recruitment and retention of whom is as important for addressing historical inequities in the local industry as it is for ensuring the diversity that companies need to reach a bigger market and gain a competitive edge. Further, as government is a significant purchaser of pharmaceutical goods and services, companies must ensure that the required Black Economic Empowerment (BEE) rating level is achieved so they can continue to win government business.Contribution: The research found that it is important that the turnover rate of knowledge workers in the South African pharmaceutical industry be reduced through addressing the personal, organisational and industry factors that the workers themselves view as important, rather than giving consideration only to what human resource managers perceive as important. In particular, sufficient significance must be placed on personal factors.