Workforce Attrition and Turnover at RasGas Company in Qatar: It’s Implications on the Company’s Performance
Table of Contents
1. Background of the Study 3
2. Literature Review 5
2.1 Employee Attrition and Turnover 5
2.1.1 Definition 5
2.1.2 Causes of Employee Attrition and Turnover 6
2.2 Workforce Attrition/Turnover and Organisational Performance 10
2.3 The Role of Organisational Leadership in Reducing Employee Attrition/Turnover 11
3. Project Goal, Objectives and Research Questions 13
3.1 Research Objectives 13
3.2 Research Questions 14
4. Proposed Methodology 15
4.1 Research Design 15
4.2 Research Philosophy 16
4.3 Research Approach 17
4.4 Research Strategy 17
4.5 Sampling and Data Collection Methods 18
4.6 Ethical Considerations 19
5. Project Timescale 19
6. Resources Required 20
7. Conclusion 21
Reference List 22
1. Background of the Study
Over the past few years, business organisations have been facing increasing loss of talented workforce through turnover and attrition. Reinforced by the increasing poaching of talents in the contemporary organisations, loss of talented employees has become more prevalent over the past decade. Of the greatest concern is the highly turbulent economic environment which necessitates firms to retain their talented employees in order to foster their competitiveness, while achieving higher performances (Hendry, 2012). One of the most critical sectors is the energy sector whose role in the global economy can not be underestimated. Based on a study conducted by Bradshaw (2013), the energy sector comprises of about 29% of the global economy, and thus emerging to be among the top economic pillars across the world. One of the countries whose economy largely depends on the energy sector is Qatar whose 50% of its GDP is contributed by oil and gas products comprising of about 85% of its export earnings (Theodora, 2014). The same report also indicates that, about 13% of natural gas reserves are based in Qatar.
Among the key organisations in Qatar’s gas industry is RasGas Company which is among the leading liquefied natural gas in the world (RasGas, 2013). This is because the company has developed a stupendous reputation for safe and reliable LPG. As such, RasGas has transformed the national natural resource in Qatar into a major player into the global energy sector by contributing over 40% of the LPG products exported from Qatar (Bradshaw, 2013). This reinforces the significance of RasGas in not only the Qatar economy, but also the global energy sector. According to RasGas (2013), RasGas has two production facilities at Qatar, 2 helium producing units, numerous shipping contracts, and many other business partnerships across the world in the energy industry. The company oversees various management practices across all the units it operates in order to enhance the success of its operations. With its impact being not only significant in the local industry level, but also globally, there is no doubt that the role of RasGas in the global petroleum industry is massive.
Over the over recent years, RasGas has developed excellence facilities (both on-shore and off-shore) as it seems to facilitate high performance in its production, process, and refinery plants (RasGas, 2013). Quite importantly, RasGas has developed to be among the leading job providers in Qatar for both local and foreigners in its various production units. In addition to being an employer to large number of workers, RasGas has also been on corporate social responsibility as part of its brand building strategy. In line with Qatar vision 20130, RasGas has been careful on implementing fair working conditions, safer environment within its facilities and community development programs. In this regard, the company has been establishing programs that tough on public health, education, environmental preservation and general community development initiatives including creation of employment opportunities. Together with other contributions into the economic and social development of Qatar, RasGas seems to be one of the key organisations in Qatar.
However, despite the central role played by RasGas in the economic and social development of Qatar, it ha suffered an increasing level of workforce turnover and attrition over the past decade (RasGas, 2013). This loss of talented workforce through attrition and turnover has largely impacted negatively on its productivity. According to a study conducted by Mohamed (2014), employee attrition at RasGas increased from 5% to 20% by the end of the year 2013. This shows that, majority of the employees would only work for a very period of time, and quit immediately. While this rate of attrition was only observed in the operations departments of the company, the situation could be very risky for the productivity of the company as the company continues to lose talented technical employees in the company. This necessitates a study in order to unveil the specific factors contributing to the prevalent issue of employee attrition and turnover in the company (Coyle & Simmons, 2014).
As noted by Talent Management Alliance (2013), staff attrition and turnover is one of the key factors which have contributed to the inability of organisations to achieve their strategic goals and objectives. This is because workforce attrition and turnover erodes away crucial talents and experienced workforce which are necessary for the creation of competitive advantage in organisations (Dixon, 2013; Coyle & Simmons, 2014). With very few empirical studies on employee turnover and attrition in government owned petroleum organisations in Qatar, there is need to conduct a study on RasGas in order to establish the specific factors which have contributed towards the recently prevalent issues on workforce attrition and turnover in the company. Quite importantly, the level of attrition and turnover of staff at RasGas is quite alarming, and thus a study to investigate the factors contributing to this trend is necessary. This study therefore seeks to explore the factors contributing to the high employee attrition and turnover rate at RasGas, and establish how it has the potential impact on the performance of the organisation in the long-run.
2. Literature Review
2.1 Employee Attrition and Turnover
In most cases, the concepts of employee attrition and turnover have been used interchangeably (Armstrong and Armstrong, 2011; Ellickson, 2007). While the two terms can be considered to be similar in the context of human resources where they generally involve the loss of workforce in an organisation, they ideally have different meanings (Hendry, 2012). According to Kaiser & Ringlstetter (2011), in employee attrition, there is no replacement of lost workers in organisation, unlike in employee turnover where lost employees are replaced through new recruitments. In this regard, employee attrition can be considered to be having permanent impact on the organisation since there is usually no replacement for the gap created by lost organisations, whereas in employee turnover the lost employees are replaced with time (for a period of no more than three months as suggested by Lee et al (2008)).
It is also important to note that, both employee attrition and turnover can either be voluntary or involuntary. According to Lee et al (2008), involuntary attrition mainly involves an action taken by the department of human resource management to terminate the services offered by some employees based on various issues like performance, layoffs or disciplinary actions among others; whereas voluntary attrition and turnover involves a self-initiated decision or natural calamities like death or disabilities among employee of leaving their job. When the lost employees are replaced through recruitment, then such cases a turnover occurs. While workforce replacement may not always mean that an organisation is restored to its initial performance level since the lost employees may be more talented and experienced than the newly recruited one (Mathis & Jackson, 2011), it can be argued that attrition can be as worse as turnover in most cases. There are many reasons why organisations face employee loss through attrition or turnover among which talent poaching, workforce dissatisfaction, organisational dynamics (workplace environment), lack of career development opportunities, poor organisational leadership, and poor job-fit and organisational fit issues are the most common.
2.1.2 Causes of Employee Attrition and Turnover
a) Talent poaching
Talent poaching refers to the selection and snatching of the best talents within an organisation by offering them better terms of employment (Skabelund, 2008). In essence, talent poaching involves offering better remuneration packages for talented employees from other companies within an industry. According to Stringer, C., Didham and Theivananthampillai (2011), talent poaching is among the most common issues in the contemporary business environment where growing companies tend to poach outstanding talents from other organisations in order to enhance their competitiveness. Quite importantly, the reason behind poaching is to increase profitability and performance of organisations through having a highly talented pool of workforce capable of maintaining high quality production within an organisation. While talent poaching is most popular in technical industries, its implications to the losing organisation is a deteriorating performance due to loss of competitiveness (Talent Management Alliance, 2013). As a result of loss of competitive edge, organisations whose employees have been poached end up experiencing low productivity. It is therefore important for firms to be vigilant on the factors which may lead to their loss of workforce through poaching in order to bridge the gap before it is too late for them.
b) Workforce dissatisfaction
Employee dissatisfaction occurs when the expectations of employees are not fulfilled, leading to the need for better opportunities which can enable the employees to satisfy their needs (Toker, 2011). According to Testa (2008), employee dissatisfaction is one of the most common reasons why employees tend to leave their organisations for better opportunities elsewhere. While in some cases employee dissatisfaction may be as a result of external forces within an industry, Armstrong and Armstrong (2011) observed that the nature of work itself and organisation-related factors are the most prevalent causes of employee dissatisfaction. In this regard, therefore, when employees are expectations are not fulfilled, they tend to develop very low attachment to their job in which when better opportunities show up, such employees leave for other organisations. Among the key factors which determine employee satisfaction include the remuneration rates, and job-related stress which accounts for over 80% of the attrition and turnover rates of employees in the contemporary organisations (Hendry, 2012). It is therefore very important for managers to be very observant on how they remunerate their employees and the nature of work-related relationship between employees and their organisations in order to ensure that the employees are satisfied in order to enable them develop positive attachment for their work.
c) Organisational dynamics/ workplace environment
Organisational dynamics play a central role in influencing the extent at which employees feel satisfied and happy with their job (Ellickson, 2007). Based on a study conducted by Kaiser & Ringlstetter (2011), the favourability of the workplace environment determines the degree of the attachment that employees have with their employer. With regard Lee et al (2008) ideas, a rampant workplace environment where employees feel safe, secure and comfortable working in is becoming a key factor determining the retentionability of employees in their organisation. In a workplace environment where employees feel psychologically unsafe as a result of the poor workplace supervision culture, Mathis & Jackson (2011) observed that it becomes difficult for the employees to feel satisfied and subsequently develop positive attitude towards their job. As a result, many employees exposed to psychological fear at workplace tend to experience high level of attrition and turnover intentions. More so, the physical safety of employees also plays an important role in determining their retention in an organisation (Monks & McMackin, 2008). This is because when employees experience safety threats for their health at their workplace environment, they tend to develop high turnover/attrition intentions.
d) Lack of career development opportunities
Based on Herzberg’s two-factor theory, one of the key motivators which nurture commitment among the employees in their job is the availability of career development opportunities especially in the professional and technical jobs (Skabelund, 2008). In essence, when employees get development opportunities for their careers, they usually feel satisfied because they achieve self actualisation (Stringer, Didham and Theivananthampillai, 2011). In this regard, when an organisation provides opportunities for employees to enhance their careers, they enjoy high levels of high employees’ commitment as a result of the high satisfaction that the employees get from their job. While career development opportunities may be in the form of on/off-job training or study leaves, employees tend to gain more skills which foster their efficiency and competency in their job. In cases where employees are not offered career development opportunities in their organisation, they usually tend to develop low job commitment which in return contributes towards increased turnover/attrition intentions (Talent Management Alliance, 2013). This clearly shows that, lack of career development opportunities is one of the key factors contributing towards the loss of workforce in an organisation through attrition or turnover.
e) Poor organisational leadership
According to a study conducted by Testa (2008), the nature of organisational leadership is among the key factors which influence behaviours within the organisation. This is because the organisational leadership is responsible for designing of workplace culture, employee remuneration, and the general workplace interactions in organisations. In this regard, the quality of supervision offered by leaders within an organisation determines whether employees are satisfied or not. For example, Toker (2011) observed that, when an organisational leadership offers a supportive learning environment where employees are free to interact with the supervisors and other leaders within an organisation, employees develop positive attitudes towards the organisation. However, when employees perceive an organisational leadership to be oppressive or unfavourable to them, they usually have low attachment to their organisation which in most cases leads to the employees leaving the organisation resulting into attrition of job turnover (Testa, 2008). This clearly shows that, the quality of leadership in organisations is a major factor that determines the retentionability of the employees within the organisation.
f) Poor job-fit and organisational fit
Job-fit is is the conformity between en employee skills and the skill requirement of a particular job; whereas organisational fit refers to the ability of an employee to cope or conform to the organisational culture within a company (Stringer Didham and Theivananthampillai, 2011). Both job-fit and organisational-fit are considered by Monks & McMackin (2008) to be fundamental factors determining the ability of employees to retain their job or to experience attrition or turnover. For example, employees with poor job-fit tend to be less productive, and usually face involuntary attrition or turnover; whereas employees with poor organisational-fit usually find it difficult to remain in the organisation because they feel unsafe and dissatisfied within the organisation (Mathis & Jackson, 2011). As a result, it can be argued that poor organisational-fit and job-fit is a key factor which influences whether employees are retained in their organisation or not, leading to attrition or turnover intentions.
2.2 Workforce Attrition/Turnover and Organisational Performance
There are numerous studies established to investigate the relationship between employee attrition/turnover with organisational performance (Lee et al, 2008). Based on a study conducted by Kaiser & Ringlstetter (2011), high rate employee loss within an organisation is dangerous as it contributes to the loss of talents within an organisation which in the long-run leads to the loss of the competitive advantage of the organisation. In cases of attrition, an organisation may end up being unable to conduct some functions since the people who could have conducted such activities are lost. In essence, there is no doubt that workforce attrition/turnover in organisations affects the performance of the organisation adversely. As noted by Hendry (2012), employees’ loss through attrition or turnover usually leads to quality deterioration in cases where talented employees are lost. This is because some of the technical jobs may be given less experienced people with limited skills on the nature of the job; leading to compromise in the quality of final products within the organisation.
Moreover, a study conducted by Ellickson (2007) also revealed that high levels of employee attrition or turnover usually leads to poor financial performance in the organisation. While poor financial performance in an organisation may be as a result of many factors within or outside the organisation (Armstrong and Armstrong, 2011); high attrition or turnover rate of employees plays a major role in influencing financial crisis within an organisation (Toker, 2011). For the case of employee turnover, recruiting new employees is usually a costly process, leading to extra unnecessary costs within the organisation. Moreover, newly recruited staff members may not be as productive and efficient as the lost employees, and this may adversely affect the performance of the organisation in terms of productivity. It is also important to note that, high customer turnover rate may affect the confidence of the customers and this usually leads to decreased sales, leading to the overall decline in the performance of the organisation. In this regard, therefore, it can be argued that high rate of employee attrition negatively affect the performance of an organisation.
2.3 The Role of Organisational Leadership in Reducing Employee Attrition/Turnover
Organisational leadership is described by Testa (2008) as the central pillar of an organisation because it determines the success or failure of the organisation through its various functions. According to Stringer, Didham and Theivananthampillai (2011), the human resource management department plays a central role in influencing behaviours of the employees in the organisation in various ways. First, the quality of supervision offered in the organisation is a key determinant of the satisfaction level of employees in the organisation. This is because when the -line managers offer supportive leadership to the employees by engaging them in solving complex problems in their work, they tend to develop positive attitude towards their work, unlike in case where the line managers are strict, harsh and non-supportive to the employees in cases of difficulties. In such cases, employees tend to develop low satisfaction in their job, leading to negative attitude towards the organisation and subsequent high attrition/turnover intentions.
The issue of employees’ remuneration and recognition is also identified by Skabelund (2008) to be a key factor that influences employee behaviour at workplace. When employees are remunerated satisfactorily, while being recognised for their efforts within an organisation, they usually develop positive attitude towards their job which increased their attachment to the organisation. On the other hand, Monks & McMackin (2008) observed that when employees are subjected to poor remuneration they usually tend to be less satisfied in their job and this increases the chances of them leaving the organisation. Similarly, when employees’ efforts fail to be recognised and appraised by the leaders within an organisation, they usually remain less motivated which in return contributes to their high turnover/attrition intentions. This clearly shows that, poor remuneration and lack of recognition of employees is a key factor which organisational managers can be blamed for high rates of employees’ turnover or attrition.
Adequate staffing and employee development is also another key important role of organisational leadership which need to be given priority in order to reduce cases of employee attrition and turnover (Mathis & Jackson, 2011). When employees are overburdened with work as a result of poor work schedules, they usually tend to be experience low work-life balance which is a key factor contributing towards employee dissatisfaction. The organisational leadership is therefore mandated to ensure that there is sufficient number of staff members for the available amount of work in order to avoid overburdening the existing employees (Lee et al, 2008; Kaiser & Ringlstetter, 2011). On the other hand, developing employee skills and competency through training and other staff development methods ought to be given priority also. This is because when employees are given career development opportunities through training (both on-job and off-job), they usually tend to remain satisfied which in return contributes towards their retention in the organisation.
3. Project Goal, Objectives and Research Questions
The ultimate goal of this project is to establish the factors which contribute to the high level of attrition and turnover at RasGas Company, Qatar. Given the importance nature of the company in not only Qatar economy, but also globally, this study focuses on unveiling how RasGas can achieve high performance through focusing on the causes of attrition and turnover of employees in the company over the recent years. Successful completion of this project is also expected to contribute to the practical realms on how the management of RasGas can contribute to the success of the company by implementing various strategies which reduce employee attrition and turnover intentions, while unleashing the potential of company’s workforce in terms of productivity. The following sub-sections present the research objectives and questions in the light of the research goals in this project.
3.1 Research Objectives
This research project will be based on the following research objectives:
– To evaluate the trend of employee turnover and attrition at RasGas from the year 2011 to the year 2013
– To identify the main factors which influence employee attrition and turnover at RasGas over the recent years
– To position the current situation of RasGas in the field of academic literature by identifying the underlying reasons for the prevalent high level of employee turnover
– To Examine whether employee attrition and turnover at RasGas influences its performance over the past few three years
– To suggest long-term solutions on how the management of RasGas can enhance employee satisfaction, while reducing the rate of employee attrition and turnover at RasGas
3.2 Research Questions
This project will be guided by the following overarching research question: “What are the main causes of employee attrition at RasGas over the recent years?” In the context of this question, the following sub-questions will be adopted to guide the researcher:
– What is the trend of employee attrition at RasGas over the past years between the years 2011 and 2013
– What are the factors which have contributed to the identified levels of employee attrition and turnover at RasGas?
– What does the academic literature say about the trends observed at RasGas with regard to employee attrition and turnover at the company
– How can the management of RasGas mitigate the situation in the company with regard to employee attrition and turnover in the company
4. Proposed Methodology
4.1 Research Design
According to Bryman and Bell (2007), research design is the conceptual structure in which a study is conducted which presents the road map for the collection, measuring and analysis of a research problem. In essence, the research design defines the scope of research a phenomenon which establishes a pathway in which a study is executed, the nature of data to be collected, and the sources of data to be collected. There are four main research designs which include exploratory design, explanatory, correlation, and descriptive design (as shown in figure 1 below).
In this study, the researcher will consider integrating both exploratory and explanatory designs in order to enhance comprehensive coverage of the research problem (Saunders et al, 2009; Fisher, 2010). Since explanatory design focuses establishing the causal relationship between variables, while exploratory design explores how a research phenomenon to determine the underlying cause-effect relationships between/among among the variables involved (Bryman and Bell, 2007); the researcher will be able to enhance extensive coverage of the reasons why employees leave RasGas, and subsequently suggest long-term solutions based on the existing theoretical framework on employee attrition and turnover.
Figure 1 – Types of Research Design
Source: Bryman and Bell (2007).
4.2 Research Philosophy
The research philosophy represents the development of knowledge and the various assumptions made by a researcher during a research process (Krauss, 2005). In essence, the research philosophy represents the researcher’s point of view with respect to the discipline in which the research problem being explored falls into. In the field of management, Simon (2011) suggests two main research philosophies which include positivism and interpretivism. In this study, the researcher considers to combine both interpretivism and positivism with regard to the research problem. Positivism philosophy is mainly concerned with the systematic verification of knowledge or claims through scientific inquiries; whereas interpretivism is based on how meanings are extracted with respect to social constructs (Wilson, 2010). As such, combining both interpretivism and positivism philosophies would enable the researcher to be able to elaboratively explore the key issues facing RasGas with regard to workforce management and the reasons why employees leave the organisation.
4.3 Research Approach
There are two main research approaches which include induction and deduction (Simon, 2011). According to Kumar (2008), deduction involves the proving of theories through testing data with regard to an existing framework of scientific procedures; whereas induction is concerned with development of theories using a new data collected in a study. In this study, the researcher has considered an integration of both inductive and deductive approaches in order to test the factors identified in the literature review with regard to employee attrition and turnover at RasGas, while also gaining deeper insights on what efforts the management has been doing to ensure that the employees in the company are maintained in the long-run.
4.4 Research Strategy
The research strategy refers to the general orientation of a research study which defines the spheres within which a research is conducted, while providing a scheme on the entire data collection process (Fisher, 2010). According to Saunders et al (2009), there seven main research strategies which include survey, case study, archival study, action research, experiment, grounded theory, and ethnography. In this study, the researcher considers to use case study in order to be able to explore the research problem more comprehensively. Survey is not considered to be a suitable research strategy because of the small number of participants, and also because this study focuses only on a single case organisation. Case study strategy is expected to enable the researcher to comprehensively cover the research problem by focusing only on limited number of participants belonging to the same organisation.
4.5 Sampling and Data Collection Methods
The research population in this study will be the employees and the management of RasGas. The choice of RasGas Company in Qatar was guided by its significance in not only the Qatar petroleum industry, but also in the global petroleum industry as well. Having been experiencing continued level of employee attrition over the past few years, the researcher will focus on establishing the reasons why such trends have been prevalent, and what the management is doing to mitigate the problem. While selecting the participants, simple random selection strategy will be used where a sample of 60 employees from the company will be selected. In the case of the company’s management side, purposive sampling strategy will be used to select the participant who will be interviewed in order to get deeper insights on what the management is doing to mitigate employee attrition and turnover in the company. As such, one of the human resource management professionals in the company will be selected based on their seniority in order to select somebody who will be able to give detailed information about the management of workforce at RasGas Company.
In this study, both primary and secondary data will be collected. Secondary data will be collected from published materials including company reports, industry reviews, books, scholarly materials and credible internet sources. On the other hand, primary data will be collected using questionnaires and interviews. The sample of 60 participants who will be selected will be issues with questionnaires to fill. The questionnaires will comprise of open-ended and closed-ended questions which aims at collecting information about the participants’ experiences in the company and their intentions to stay in the organisation.
On the other hand, an interview with one of the senior HR professionals in the company will also be conducted. This will enable the researcher to be able to get deeper insights on the key measures that the company is taking to ensure high rates of employee retention in the company, while reducing the rampant employee attrition and turnover in the company. Since both quantitative and qualitative data will be collected in this study, a comprehensive data analysis procedure will be conducted. For the findings from questionnaires, SPSS 17.0 program will be used in analysis the data, whereas thematic analysis technique will be employed in analysing qualitative data from the interview.
4.6 Ethical Considerations
Research ethics are usually very important in any study because they enhance the credibility and reliability of the research findings (Easterby-Smith and Jackson, 2012). Based on Bryman and Bell (2007) ideas, ensuring the participants’ confidentiality, informed consent and safety are among the fundamental considerations in any social and scientific study. On this basis, the researcher will ensure that the confidentiality of the participants is safeguarded, they have informed consent and their safety (physical, emotional and psychological) is guaranteed throughout the study. By doing so, the researcher believes the entire research process will be credible, and thus foster the reliability of the research findings.
5. Project Timescale
This project is expected to be completed within a period of 12 weeks from 1st March 2015 to 1st June 2015. Among the key activities that will be conducted during the project include completing the research project proposal, research relevant literature review materials, writing up literature review, data collection, data analysis, writing up the entire dissertation, and submitting it for review by supervisor (as shown in table 1 below). Considering the limited amount of time given on this project, the researcher expects that every planned activity will not be faced by complications which may require longer time to be completed.
Table 1 – Gantt Chart showing the Project Schedule
6. Resources Required
This project is expected to require a number of resources in order to be successfully executed. First, the researcher will need some money for travelling which is estimated to be about $1000 USD. Online search of materials in databases and online databases is also expected to cost about $500 USD (as shown in table 2 below). Further, the researcher will be required to purchase a recorder which will be used during the interviews which is expected to cost about $200 USD. Printing of questionnaires and other stationery is also expected to cost about $300. In addition, miscellaneous expenses are also planned to be about $500 USD in order to enable the research project to be successful.
Table 2 – The Project Budget
Description Amount (USD)
1 Travelling expenses $1000
2 Online research (databases and libraries) $500
3 Recorder $200
4 Stationery and printing $300
5 Miscellaneous $500
As it has been revealed in this proposal, RasGas Company is one of the key pillars in the petroleum industry of Qatar, and also the world. As such, its performance is a key determinant for the welfare of not only the Qatar petroleum industry, but also globally. With the continued increase in the level of employee attrition and turnover in the company over the recent years, there is risk of deteriorating performance in the company as a result of continued loss of talented and experienced workforce in the company. By conducting this study, the researcher is expected to shed more light on the key HR issues facing the company, and subsequently suggest holistic solutions for long-lasting mitigation of workforce attrition and turnover in the company.
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