Effects of Identity Variables and Job Performance on Employee Intentions to Leave: An Empirical Study in Indian Call Centers

Abstract

Voluntary employee turnover has remained one of the most important concerns for the practice of human resource management since it involves loss of investments made in the people who leave and increased costs of finding and training replacement (Hom and Griffeth, 1995). In the Indian international call center industry, employee turnover is the biggest HR problem (Ramesh, 2004). Recent studies have shown how identity centrality, i.e., the relative importance of one set of identities within multiple identities that a person holds, affects one's intention to leave in this industry. For example, national identity centrality, which is when a person holds their national identity to be one of the most important identities, is associated with a high intention to leave; whereas occupational identity centrality, or a high importance of one's professional identity, is associated with lower intention to leave. In this paper, we specifically explore how identity centrality and organizational identification (OI) interacts with performance to impact intention to leave in this industry. For this we conducted a survey with questions designed specifically to test a range of different identity centralities. Our data collection yielded 268 usable surveys from one Indian call center. Our findings show that both occupational and national identity centralities affect intention to leave over and above organizational identification. We also find that these identity centralities are moderated by variance in performance. Introduction The Indian international call center industry is a unique industry that has captured the imagination of people not only in India but across the world. This is evidenced from a large number of movies, novels, plays and journalistic reports that have been written on it (Das, 2007). It emerged as a result of processes of globalization of work that came from outsourcing service work to India. The industry rose in prominence yet, we find that is remains affected by a huge problem of employee attrition. Studies have stated this problem to range anything between 30% to 70% (Russel and Thite, 2010) - a figure that is extraordinarily high even for the call center industry globally which is otherwise known as a high turnover industry. While there is consensus on the loss of profitability engendered by employee turnover, there are relatively few academic studies that have focused on the factors that affect employee decisions to leave. Das, Dharwadkar and Brandes (2008) identified some of the interesting factors that are relevant to the nature of work done in this industry with respect to issues of employee identity and identification. They showed how national identity centrality is an important variable in this context, along with other identity variables in predicting intention to leave. In this paper, we take a step forward and show how these relations are moderated by employee performance. Since this industry is driven by very high performance orientation with high incentive pay for performance we believe that both employee performance and identity would interact to impact an employee's intention to leave (Budhwar et al, 2006). Thus, it is both relevant and interesting to investigate not only how the different identity variables affect turnover intentions but also how employee performance contributes in moderating the relationship. We try to answer these questions by carrying out an extensive study of Indian call centers with a survey in a third-party, mid-size, outbound call center in India. The study was also preceded by an in-depth pre-study of qualitative interviews with call center employees that helped us build the theoretical model to test through the survey. Literature Review and Theory Development The call center industry across the world has emerged as a new form of customer service that has redefined the way businesses are conducted. They have experienced tremendous growth with about two-thirds of customer interactions of all organizations now occurring from call centers (Barker, 1998). …