Executive Summary: Retaining a Diverse Work Force, cont'd
Implications
The internal application of marketing principles to relationships with employees, particularly in terms of market segmentation, will allow organizations to identify specific values and retention criteria for target populations within the organization. This, in turn, can lead to a cohesive sustainable strategy for retaining diverse employees. IMO works largely through developing and enriching relationships between employees and organizations. These stronger relationships should result in more positive attitudes, such as job satisfaction and organizational commitment, increased identification with the organization, and lower turnover. A conceptual model illustrating the components of an IMO plan focusing on the retention of diverse employees is presented in Figure 1.
Steps in the implementation of IMO are outlined in Table 1. The activities necessary for the realization of employee potential through IMO begin with the generation of employee information. Information generation methods typically include focus groups, surveys, and interviews. HR managers have used these methods of collecting data for decades. However, such data have rarely been subject to the comprehensive marketing-driven uses described here. A marketing approach to information generation allows organizations to gather information specifically regarding how different groups of employees feel about the organization and the things they consider most important, and focuses on tailoring strategic responses to these groups. The organization is also able to steer its corporate branding effort through IMO, gauge how employees feel about the corporate brand, and assess employee knowledge of and alignment with the corporate brand.
The three steps of IMO each have important implications for the organization.
Information generation activities may include collecting employee value
attributes, identifying exchanges of value among employees, segmenting
the internal market according to their specific value attributes, evaluating
external market conditions facing employees, and, finally, developing
retention strategies for each of the employee segments. After information
has been collected from internal customers, it is imperative that the
information be communicated throughout the organization. Open communication
among managers and between managers and their subordinates facilitates
the effective use of valuable employee-provided information. As an organization
responds to the information, it will provide employees with tangible evidence
of their efforts to understand the information provided by the employees
(e.g., job redesign, improved communication channels, alignment of reward
systems, training and development opportunities, management consideration,
and responses to external market alternatives).
Finally, organizations may want to assess the extent to which they are
currently engaging in IMO activities.
Research has not provided a valid and reliable measure of internal market orientation.14, 15 Given the IMO focus on relationship building with employees, the authors developed a measure of employee perceptions of IMO activities. Following the conceptual identification of the likely important dimensions of IMO, new items to tap these dimensions were generated and some items from a widely used market orientation scale were adapted.16 These items focused on information generation, information dissemination, responsiveness, and branding.
To gauge the content validity, four outside experts—marketing professors with expertise in IMO—assessed the suitability of the items as compared to the construct definition. Slight revisions were made based on the expert assessments. An initial pilot study was performed with 49 employed adults who were also undergraduate students to assess the reliability and dimensionality of the scale and to refine the items. Exploratory factor analysis helped eliminate items that did not load cleanly on one factor, and also suggested that items related to information generation and information dissemination loaded on the same factor. This factor was renamed information exchange. The responsiveness items loaded on two factors, one that seemed to represent responsiveness, and one that seemed to address segmentation. This resulted in four dimensions, each exhibiting good reliability: information exchange, responsiveness, segmentation, and branding.
A second pilot study was conducted with 66 employed adults who were also graduate and undergraduate students. Results of both exploratory and confirmatory factor analysis suggested that a 14-item scale representing the four dimensions noted above has a reasonably stable factor structure with acceptable reliability (as regards the internal consistency of items in a multi-item measurement scale). The authors also began the process of assessing the convergent and discriminant validity of the IMO measure.17 Patterns of correlations within dimensions, with measures of job satisfaction and turnover intentions, and with a measure of self-monitoring provide some preliminary evidence of both convergent and discriminant validity. Of particular interest, each dimension of IMO was significantly positively correlated with job satisfaction, and significantly negatively correlated with turnover intentions.
The final 14-item internal market orientation scale is presented in Table 2. This scale captures four related but distinct dimensions of the internal market orientation construct. Preliminary data in two pilot tests suggests these measures have acceptable reliability, a relatively simple factor structure, are positively correlated with job satisfaction, and are negatively correlated with turnover intentions. Despite these promising early results, this measure requires further confirmatory testing before use. A well-developed IMO scale will be useful in helping organizations assess their present level of IMO activities and to focus their development of an IMO plan.
Conclusion
Many organizations desire to develop retention strategies and practices that focus on specific, high value, high turnover segments of their work force, and the potentially unique factors driving these employees’ decisions to participate in the organization. Organizations can establish and strengthen internal relationships consistent with their corporate brand by applying an IMO, which can be a critical strategic tool in identifying diverse employees and responding to their needs. IMO activities enable organizations to tailor their retention strategies to specific employee segments. The IMO scale developed in this study can be used by organizations to gauge their current level of IMO, while the model and implementation strategies can serve as a starting point for organizations desiring to adopt or improve their IMO. In sum, the internal application of marketing principles to relationships with employees, particularly in terms of market segmentation, will allow organizations to identify specific values and retention criteria for target populations within the organization. This, in turn, can lead to a cohesive sustainable strategy for retaining diverse employees.
Endnotes
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