Impact of Rewards on Employee Retention Intention: Evidence from a Novel Industry in Sri Lanka

The fast-moving business environment demands that organizations pursue a competitive advantage in effectively managing human resources. ABC Private Limited is a business processing organization that collaborates with customers from the United States of America in a novel industry introduced in Sri Lanka only ten years ago. Despite its heavy investment in rewards, ABC has been experiencing a steep increase in turnover. This study evaluates the correlation between rewards (Recognition, Compensation, Supervisor Influence, and Work-life Balance) and employee retention to enhance the latter. The study utilized mixed methodology, collecting quantitative and qualitative data through a survey questionnaire from 132 respondents. It confirmed the existing retention problem using IBM Statistical Package for the Social Sciences (SPSS) for quantitative assessment and content analysis for qualitative. The four dimensions of reward accounted for 80.1% variance in retention. The study found statistically significant positive correlations with those four predictors: compensation and supervisor influence – moderate; and recognition and work-life balance - strong. Accordingly, the researcher arrived at recommendations for the organization and a broad scale to a novel industry.