See discussions, stats, and author profiles for this publication at: https://www.researchgate.

net/publication/336675522

Succession Management Practices And Employee Retention In The Property

Industry: Evidence From Malaysia

Article · October 2019

CITATIONS READS

8 600

5 authors, including:

Kowang Owee Tan Adriana Mohd. Rizal

Universiti Teknologi Malaysia Abcam
105 PUBLICATIONS   624 CITATIONS    49 PUBLICATIONS   79 CITATIONS   

SEE PROFILE SEE PROFILE

Some of the authors of this publication are also working on these related projects:

Business Research Project View project

UTAUT2 on postnatal services industry View project

All content following this page was uploaded by Ong Choon Hee on 20 October 2019.

The user has requested enhancement of the downloaded file.

 INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 8, ISSUE 10, OCTOBER 2019 ISSN 2277-8616

Succession Management Practices And

Employee Retention In The Property Industry:
Evidence From Malaysia
Ong Choon Hee, Yeo Hui Ying, Tan Owee Kowang, Adriana Mohd Rizal, Lim Lee Ping

Abstract: The purpose of this study is to identify the relationship between succession management practices and employee
retention in the property industry in Southern Malaysia. The independent variables of this study are career planning programs,
mentoring and coaching and job rotation while the dependent variable is employee retention. The research design of this study
is using quantitative and cross-sectional approach. Online survey questionnaire was employed to collect data and yielded 397
responses. The findings revealed that career planning programs, mentoring and coaching and job rotation were significantly
related to employee retention. This research is able to provide essential information for companies in the property industry to
increase understanding on employees’ career needs and implement effective employee retention strategies to retain talented
workforce. It further assists organizations to integrate their succession management practices with employee retention efforts to
ensure talents remain in the organization to succeed succession management plan.

Index Terms: Succession management practices, employee retention, property industry, Malaysia.
——————————  ——————————

1. INTRODUCTION 2 LITERATURE REVIEW AND HYPOTHESIS

Owing to the fast pace of change in the world and emergence DEVELOPMENT
of globalization, different demands are required to fulfil by
employees to develop their career in an organization. 2.1 Succession Management Practices
Employee turnover leads to costly impact towards Succession management practices are core activities in the
organizations in terms of monetary implications. This raises stages of succession planning. The aim of succession
the importance of succession management practices in management practices is to identify potential successors and
employee retention. The property imbalance situation in Johor, narrow the capability and readiness gap between the current
Malaysia raised the concerns of systemic risk in the property management staffs and potential successors. Succession
industry. Researcher [1] further shared the challenges found in management practices play essential role in retaining the
the current property industry such as large percentage existing talents as well as saving organizational costs on
surpluses of unsold residential properties, severe congestion external recruitment. Researcher [2] expressed that
at the border crossing to Singapore and the postponement of succession management practices are to ensure the
KL-Singapore high-speed rail (HSR) project. This may lead to readiness of skilled talents to take over any key roles in the
an increase in unemployment rate since employees would organization. Investment in succession management practices
have low confidence in facing the current bleak situation. is crucial. Organizations should involve senior management in
Therefore, there is a need to find a solution to overcome this succession management practices actively to ensure its
situation. Although Johor is one of the rapid-growing states in effectiveness. In a study of [3], succession management
Southern Malaysia, limited studies have been conducted to practices allow employees at all levels to create positive
identify the relationship between succession management organizational learning culture. Among the successful
practices and employee retention. Hence, this study attempts succession management practices are mentorship, coaching,
to fill the research gap by raising the below questions: career planning program and job rotation.
1. What is the relationship between career planning
program and employee retention in the property industry? 2.2 Career Planning Program and Employee Retention
2. What is the relationship between mentoring and coaching Today, one of the drastic challenges to organizations is to
and employee retention in the property industry? retain the quality talents for the long term due to economy
3. What is the relationship between job rotation and uncertainty, increasing competition and lack of skilled
employee retention in the property industry? workforce. Researchers [4] pointed out that majority of the
———————————————— employees leave their jobs due to lack of career progression.
 Corresponding Author: Ong Choon Hee, Azman Hashim Researcher [5] claimed that career planning is a ―constant
International Business School, Universiti Teknologi Malaysia, Johor, procedure of self-appraisal and objective setting planned by
Malaysia. E-mail: ongchoonhee@gmail.com. representative and business keeping in mind the end goal to
 Co-Authors: Yeo Hui Ying, Tan Owee Kowang, Adriana Mohd Rizal, work in accordance with hierarchical target‖. Besides,
Lim Lee Ping, Azman Hashim International Business School,
Universiti Teknologi Malaysia, Johor, Malaysia.
researcher’s [5] study also established that career planning
program contributed towards efforts on employee retention.
Previous study have indicated that career planning has
positive correlation with employee retention [6]. Hence, it is
hypothesized that:

1409
IJSTR©2019
www.ijstr.org
 INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 8, ISSUE 10, OCTOBER 2019 ISSN 2277-8616

H1: Career planning program has a significant positive while items for job rotation (5 items) were adapted from [22]. A
relationship with employee retention. 5-point Likert scale was used to measure the level of
agreement for all the study variables.
2.3 Mentoring and Coaching and Employee Retention
Researcher [7] mentioned that mentoring and coaching ease 4 RESULTS AND DISCUSSION
in developing new process of thinking among the interactions
between experienced individuals and newbies in order to 4.1 Profile of the Respondents
conquer obstacles faced in organizations. It has been Among the 397 respondents, 144 were males and 253 were
reinforced as a key managerial behavior that organizations females. Majority of the respondents were aged between 26 to
must encourage for the purpose of employees’ development 30 years old which accounted for 50.1% of the respondents. In
and higher levels of performance achievement. Researcher terms of marital status, 290 of the respondents were single
[2] made the point that mentoring and coaching potential (73%) and 107 (27%) were married. In the category of
talents in succession management is to ensure they are well- education background, most of the respondents (293, 73.8%)
equipped with necessary skills and knowledge required. were bachelor’s degree holders.
Researchers [8] also mentioned that employees who received
proper mentoring and coaching are more likely to stay in the 4.2 Factor Analysis and Reliability Test
organization. This was also supported by researcher [9] where Factor Analysis was conducted by employing Principal
mentoring and coaching have common effects on employee Component Analysis (PCA) to assess validity of the study
commitment, performance, employee turnover intention, variables. Table I shows the results of factor analysis for the
employee retention and other related factors. Therefore, based independent variables (i.e. career planning program,
on the above explanation, it is hypothesized that: mentoring and coaching, job rotation). Table II indicates a
single factor for the dependent variable (i.e. employee
H2: Mentoring and coaching has a significant positive retention). All the variables were deemed reliable as they had
relationship with employee retention. surpassed the alpha value of 0.70 as suggested by [23].

2.4 Job Rotation and Employee Retention TABLE I. FACTOR ANALYSIS FOR THE INDEPENDENT VARAIBLES
Job rotation is defined as systematic employees’ movement Factor Loading
from one job to another at planned intervals [10, 11]. It is one Item Description
1 2 3
of the job design approaches organization used to train
employees in the way that they expose to different areas of CP1 Career planning programs
0.834
provide insight to my future.
knowledge [12]. Researchers [13] shared that job rotation is a CP2 Career planning in
useful technique to improve employees work performance as organization makes me more 0.837
well as increase employee engagement and employee engaged in work.
retention. Researchers [14] revealed that job rotation allows CP3 Career advancement
employees to improve their skills, increase productivity as well possibilities increase my 0.812
as cultivate new relationships across the organization which is motivation in work.
CP4 Defining career path clarifies
essential for employee retention. Hence, it is hypothesized me in the direction of learning 0.790
that: and improvements.
CP5 Clear career planning helps
0.800
H3: Job rotation has a significant positive relationship with me to set career goals.
employee retention. MC1 I have supportive superior in 0.850
mentoring and coaching me
during work.
3 METHODOLOGY MC2 I receive regular feedback on 0.807
my job performance.
3.1 Population, Sample and Sampling Procedure MC3 I perform work using the 0.813
The total population of this study consists of employees approaches shared by my
superior.
working in the property industry in Johor. According to [15],
JR1 I receive workshops and
people who engaged in real estate services in 2017 were seminars by management
176,382 persons where people who engaged in construction 0.706
team on the importance of job
sector reached 1,330,266 persons in 2018. The sample size of rotation.
the study is targeted to be at least 384 respondents which JR2 I understand job rotation
determined by using researchers’ [16] sampling table. The functions and policy in
0.805
succession management
sampling procedure used in the study is snowball sampling.
practices.
Snowball sampling method was chosen because it is efficient JR3 I feel the supportiveness from
to obtain large number of samples. Online survey management team on 0.795
questionnaire was employed in this study which yielded 397 employees’ job rotation.
responses. JR4 I am clear that there is a need
for employees to involve in job
0.732
rotation for career
3.2 Measures advancement.
The measures of employee retention (6 items) were adapted JR5 I understand the value of job
from the study of [17]. The items of career planning program (5 rotation is to enhance staff
0.726
items) were adapted from [18], [19] and [20]. Mentoring and motivation, commitment and
coaching’s measurements (5 items) were adapted from [21] participation in work.

1410
IJSTR©2019
www.ijstr.org
 INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 8, ISSUE 10, OCTOBER 2019 ISSN 2277-8616

Eigenvalue 6.216 1.863 1.203 planning program was found to be significantly related to
Percentage of Variance Explained (%) 47.813 14.330 9.257 employee retention (β=0.195, p<0.001). Researchers [26]
Cumulative Percentage (%) 47.813 62.143 71.400 asserted that career planning program assists in employee
Reliability Coefficient (Cronbach Alpha) 0.907 0.866 0.847
retention because employees’ sense of loyalty towards
Note: KMO = 0.883, Bartlett’s test of Sphericity; Approx.Chi- employer increase as they viewed employers’ efforts of career
Square = 3220.943, p < 001. planning programs as organization’s investment towards them.
Career planning program gives employees opportunities in
TABLE II. FACTOR ANALYSIS FOR EMPLOYEE RETENTION exposing them to different duties and responsibilities. These
Factor Loading
Item Description
1
opportunities facilitate the elevation of employees’ confidence,
I did not survey on job opportunities in self-esteem, job gratification and retention [27]. Next, it was
ER1 0.589 revealed that job rotation (β=0.124, p<0.05) is significantly
current market.
I am willing to work in current company for related to employee retention. Employees who experience job
ER2 0.904
the rest of my lifetime. rotation are exposed to different areas of knowledge and thus
I enjoy working in current company and improve their performance and productivity [28]. As there are
ER3 0.922
don’t wish to switch to another company.
different roles in the property industry, employees who are
ER4 I am proud to work for this company. 0.845
I found the meaningfulness working in multi-skilled and multi-tasked would be more appreciated, gain
ER5 0.821 more satisfaction and perform better. High performance
current company.
Eigenvalue 3.402 employees are less likely to switch their job and leave the
Percentage of Variance Explained (%) 68.048 organization [29].
Cumulative Percentage (%) 68.048
Reliability Coefficient (Cronbach Alpha) 0.874
5 CONCLUSION
Note: KMO = 0.811, Bartlett’s test of Sphericity; Approx.Chi- This study provides a coherent view on the relationship
Square = 1304.651, p < 0.001. between succession management practices and employee
retention in the property industry in Johor, Malaysia. It gives a
4.3 Multiple Regression Analysis clearer direction for management to make more reliable
Table III shows the multiple linear regression analysis among decisions in designing employee retention strategies.
the independent variables and employee retention. The results Management should pay attention to these results and identify
indicate that 36.6 percent (R2=0.366) of the variance of effective succession management practices such as career
employee retention can be explained by the three independent planning program, mentoring and coaching and job rotation to
variables. The analysis shows that all independent variables increase employee retention.
have significant positive relationship with employee retention.
Mentoring and coaching (β=0.409, p<0.001) has the strongest
relationship with employee retention, followed by career ACKNOWLEDGMENT
planning program (β=0.195, p<0.001) and job rotation The authors wish to thank the Malaysian Ministry of Education
(β=0.124, p<0.05). Therefore, hypothesis H1, H2 and H3 are and Universiti Teknologi Malaysia (GUP Tier 2: 15J99) for
accepted. providing financial support to publish this paper.

TABLE III. MULTIPLE REGRESSION ANALYSIS FOR THE REFERENCES

INDEPENDENT VARIABLES AND EMPLOYEE RETENTION [1] Saad, H. (2018). Is the Johor property industry prepared
Independent Employee Retention H Result for the worst? Retrieved from
Variables Beta, β Sig. B Std. https://www.malaysiakini.com/letters/449792
Error [2] Mathur, A. (2011). Succession Planning: A Planning that
Career turns out into a legacy. International Journal of
0.195** 0.00 0.27
Planning 0.067 H1 Accepted
Program (CP)
* 0 5 Management and Technology, 19(2), 50-59.
Mentoring [3] Ali, A. A., Freyedon, A., & Javad, A. (2012). Talent
0.409** 0.00 0.44 management and succession planning. Interdisciplinary
and Coaching 0.055 H2 Accepted
* 0 9
(MC) Journal of Contemporary Research in Business, 4(1), 213-
Job Rotation 0.01 0.15 224.
0.124* 0.067 H3 Accepted
(JR) 8 9 [4] Nyambura, K. N., & Kamara, M. (2017). Influence of
F value 75.724
career development practices on employee retention in
R Square 0.366
public universities in Kenya: A case of Technical University
***Significant at the 0.001 level. *Significant at the 0.05
of Kenya. The Strategic Journal of Business and Change
level.
Management, 4(2), 510-522.
The findings showed that there is a significant positive
[5] Wane, K. (2016). Effect of career development programs
relationship between mentoring and coaching and employee
on employee retention in international non-governmental
performance (β=0.409, p<0.001). Researchers [24] supported
organizations in Kenya. Master’s thesis. University of
that one of the best alternatives to keep employees at all
Nairobi.
levels to feel cared and engaged is through mentoring and
[6] Das, B. L., & Baruah, M. (2013). Employee retention: a
coaching. Researchers [25] emphasized that mentoring and
review of literature. IOSR Journal of Business and
coaching is the method of transferring knowledge in order to
Management, 14(2), 8-16.
realize and nurture the potentials of talented employees.
[7] Neupane, R. (2015). Effects of coaching and mentoring on
Researcher’s [7] study also denoted that mentoring and
employee performance in the UK hotel industry.
coaching helps in enhancing employee willingness to stay in
International Journal of Social Sciences and Management,
the organization. As reported in the analysis results, career
2(2), 123-138.
1411
IJSTR©2019
www.ijstr.org
 INTERNATIONAL JOURNAL OF SCIENTIFIC & TECHNOLOGY RESEARCH VOLUME 8, ISSUE 10, OCTOBER 2019 ISSN 2277-8616

[8] Nkomo, M. W., & Thwala, W. D. (2016). Mentoring on [25] Reitman, A., & Benatti, S. (2014). Mentoring versus
retention of employees in the construction sector: a coaching: what’s the difference? Retrieved from
literature review, presented at Creative Construction https://www.td.org/insights/mentoring-versus-coaching-
Conference 2016, (pp. 305-310). Budapest, Hungary: whats -the-difference
University of Johannesburg. [26] Long, C.S., Kowang, T.O., Chin, T.A., Hee, O.C. (2016).
[9] Woo, H. R. (2017). Exploratory study examining the joint Improving organizational performance through training
impacts of mentoring and managerial coaching on function: A review. International Business Management,
organizational commitment. Sustainability, 9(2), 181. 10(4), 475-478.
[10] Hee, O.C., Cheng, T.Y., Yaw, C.C., Gee, W.V., Kamaludin, [27] Jehanzeb, K., & Bashir, N. A. (2013). Training and
S.M., Prabhagaran, J.R. (2016). The Influence of Human development program and its benefits to employee and
Resource Management Practices on Career Satisfaction: organization: a conceptual study. European Journal of
Evidence from Malaysia. International Review of Business and Management, 5(2), 243-252.
Management and Marketing, 6(3), 517-521. [28] Tarus, B. K. (2014). Effects of job rotation strategy on high
[11] Sinha, C., & Sinha, R. (2012). Factors affecting employee performance workplace, in Lake Victoria North Water
retention: A comparative analysis of two organizations Services Board, Kenya. International Journal of Business
from heavy engineering industry. European Journal of and Management, 9(11), 139-146.
Business and Management, 4(3), 145-162. [29] Hee. O.C., Kamaludin, N., Ping, L. (2016). Motivation and
[12] Ajusa, R. K., & Atambo, W. N. (2016). Influence of job job performance among nurses in the health tourism
rotation on organizational productivity: A case of Mount hospital in Malaysia. International Review of Management
Kenya University. Imperial Journal of Interdisciplinary and Marketing, 6(4), 668- 672.
Research, 2(10), 1361-1395.
[13] Mohan, K. & Gomathi, S. (2015). The effects of job
rotation practices on employee development: An empirical
study on nurses in the hospitals of Vellore district.
Mediterranean Journal of Social Sciences, 6(1), 209-215.
[14] Oparanma, A., & Nwaeke, L. (2015). Impact of job rotation
on organizational performance. British Journal of
Economics, Management and Trade, 7, 183-187.
[15] Department of Statistics Malaysia. (2019). The real estate
services recorded gross output value of RM32.8 billion in
2017. Retrieved from https://www.dosm.gov.my
[16] Krejcie, R.V. & Morgan, D.W. (1970). Determining sample
size for research activities. Educational and Psychological
Measurement, 30, 607-610.
[17] Kyndt, E., Dochy, F., Michielsen, M., & Moeyaert, B.
(2009). Employee retention: Organizational and personal
perspectives. Vocations and Learning, 2(3), 195-215.
[18] Ozmutaf, N. M. (2009). The effect of individual career
planning on job satisfaction: A comparative study on
academic and administrative staff. Journal of Faculty of
Economics and Administrative Sciences, 14(1), 239-254.
[19] Palmen, L. (2008). The motivational effect of a career path
model in a specialist organization. (Unpublished
thesis). Haaga-Helia University of Applied Sciences,
Helsinki, Finland.
[20] State Service Commission. (2005). Career progression
and development in the NZ public service. Retrieved from
http://www.ssc.govt.nz/upload/downloadable_files/CPDS-
2005-App3-Questionnaire.pdf
[21] Ndungu, C. N. (2016). The effect of mentoring on
employee career success in Nairobi’s star rated hotels.
Master’s thesis, University of Nairobi.
[22] Mohammadi, F. A., & Ramezani, M. (2017). Evaluate the
effectiveness of job rotation system and its impact on
employees’ readiness for job rotation. International
Review, 1-2, 27-35.
[23] Tavakol, M., & Dennick, R. (2011). Making Sense of
Cronbach's Alpha. International Journal of Medical
Education, 2, 53–55. https://doi.org/10.5116/ijme.4dfb.8dfd
[24] Hee, O.C., Ibrahim, R., Kowang, T.O., Fei, G.C (2018).
Employee engagement as a mediator between
transformational leadership and employee performance.
Asian Journal of Scientific Research, 11(3), 441-448.

1412
IJSTR©2019
View publication stats
www.ijstr.org