Improving Employees Retention Rate Through Knowledge Management and Business Intelligence Components

Abstract

The fundamental thrust of this paper is to uncover certain dimensions of organizational context through Knowledge Management (KM) and Business Intelligence (BI). KM is identified as important antecedent of employee retention that leads to direct their positive attitude toward work place. The structural model indicates that KM and BI strategies integer worker instant to retain. For data collection, the unbiased sources have been used i-e., past literature, journals, and secondary data of discussions with top management and employee's feedback. An analysis of the big data serves as the basis for determining the impact of KM trough BI and using employee retention scale. This paper discusses some reasons for turnover to include components of BI. The problems with so much data from sensors, social media, and online applications often flow and accumulate much faster than humans could possibly analyze or act on it. Further, the lack of analytical system drives organizations to a lot more depends to their employees. Most significant findings for this study demonstrate that the needs of the good analytical system in BI could generalize the training sets of data so that can help the organizations to improving their employees' retention rate.

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Knowledge Management International Conference (KMICe) 2016, 29 – 30 August 2016, Chiang Mai, Thailand
http://www.kmice.cms.net.my/ 13
Improving Employees Retention Rate Through Knowledge Management
and Business Intelligence Components
Herison Surbakti1, and Azman Ta’a2
1Universitas Respati Yogyakarta (UNRIYO), Indonesia, herisonsurbakticc@gmail.com
2Universiti Utara Malaysia (UUM), Malaysia, azman@uum.edu.my
ABSTRACT
The fundamental thrust of this paper is to uncover
certain dimensions of organizational context through
Knowledge Management (KM) and Business
Intelligence (BI). KM is identified as important
antecedent of employee retention that leads to direct
their positive attitude toward work place. The
structural model indicates that KM and BI strategies
integer worker instant to retain. For data collection,
the unbiased sources have been used i-e., past
literature, journals, and secondary data of discussions
with top management and employee’s feedback. An
analysis of the big data serves as the basis for
determining the impact of KM trough BI and using
employee retention scale. This paper discusses some
reasons for turnover to include components of BI.
The problems with so much data from sensors, social
media, and online applications often flow and
accumulate much faster than humans could possibly
analyze or act on it. Further, the lack of analytical
system drives organizations to a lot more depends to
their employees. Most significant findings for this
study demonstrate that the needs of the good
analytical system in BI could generalize the training
sets of data so that can help the organizations to
improving their employees’ retention rate.
Keywords: Knowledge Management, Business
intelligence, Employee retention rate, Analytical
Systems
I INTRODUCTION
Knowledge Management (KM) is opted as strategic
tool by executives to keep their team motivated. These
teams consist of employees who have higher level of
inspiration and competency. In modern era, worker
turnover rate is crucial issue for businesses to attain
competitive advantage. Employee’s retention can be
measured by their level of motivation and task
orientation in work environment. No organization can
compromise for loss of skilled employee because it is
much essential than any other source of development.
The KM is platform that supports strategic business
decisions with people, process, and technology
aspects.
It is widely believed that job satisfaction is wholly
dependent upon leadership integrity and justified
processes of decisions within organization. Thus,
intelligence has been a significant factor in managing
human capital. It covers all aspects of customer,
competitor, markets, technological and environmental
intelligence (Surbakti, 2015b). Business Intelligence
(BI) is process that generates valuable information
with DSS (Decision Support System), data mining and
advanced analytics for corporate strategic decisions. It
is constant approach for creating and enriching
significant information in the managerial context. For
knowledge based organizations BI is considered as
backbone in organizational structure. It turns data into
actionable intelligence for executives to make
strategies for work environment stability (Pirttimäki,
2007). Business are keen interested to use latest
technology for meeting external and internal
competition. BI adopts an effective aid to intelligence
practitioners for realizing complete picture of
resources in form of humans.
Many past studies have verified that utilizing high
association work practices “can boost firm
competitiveness” (Nwokocha & Iheriohanma, 2012;
Pirttimäki, 2007; Ranjbar & Amiri, 2015).
Competitive advantage on the basis of employees is
the most focused strategic goal for firms. Executive do
believe that it is not so easy to imitate human mind.
Skills and abilities take time to reach to a stage where
employee’s intellectual worth even crosses tangible
assets.
Moreover, the use of BI applications for knowledge is
the major portion of the enterprise software consists of
business intelligence, big data, and data analytics
(Chen, Chiang, & Storey, 2012). Most recent example
is of the acquisition of WhatsApp for a worth of USD
20 billion by Facebook. WhatsApp has only 32
engineers with 450 million active users. The 72%
users are active everyday and its users share 500m
photos a day, which is almost certainly more than
Facebook (Evans, 2014). This considering as one of
the small example of the rising of big data to analyze.
For instance, with the rise of big data, the data
accumulated from different sources such as; social
media and online applications often stream in bulk and
are much faster than a human could conceivably
analyze or act on it.

Knowledge Management International Conference (KMICe) 2016, 29 – 30 August 2016, Chiang Mai, Thailand
http://www.kmice.cms.net.my/ 14
Within firms, KM is the heart of progression planning.
Businesses that properly manage the alteration of new
employees by replacing old ones allow job and
industrial information to be transferred through the
organization to ensure that such particulars are not
lost. Either employees leave organization voluntarily
or involuntarily.
As mentioned above, that there’s a problem in
analyzing the data and act on it, especially the big
data, which is with the rise of big data, the data
accumulated from different sources such as; social
media and online applications often stream in bulk and
are much faster than a human could conceivably
analyze or act on it.
Certain business concerns included complexity,
references to the increasing pace of change,
globalization, information flow, economy, networking
and proactively. Massive development in the
information technology and communications demand
to adopt BI applications in order to deal with business
mechanisms, staying at the marketplace, rivalry,
customer control, and retention.
II LITERATURE REVIEW
In this segment, we present an analysis of the existing
literature along with critical assessment of the earlier
presented techniques encompassing BI and KM
components for most valuable assets of organization.
A. Knowledge Management
Fleig-Palmer & Schoorman (2011) recognized that in
future KM linked strategies will operate as a basis of
competitive intensity for any business. Knowledge
Management is the most influential factor for strategic
management of Business Intelligence (Fleig-Palmer &
Schoorman, 2011). Knowledge management also
closely associates with employee’s attitude and
behavior toward the job. They will stay with firms
where their views and suggestions are given
importance.
Knowledge management speaks to strategies, policies,
and techniques intended at sustaining an
organization‘s competitiveness by optimizing the
environment needed for efficiency enhancement,
modernization, and teamwork among employees
(Iqbal & Mahmood, 2012).
B. Business Intelligence
BI is recognized as managerial tool used to produce up
to date information for strategic decision making
(Pirttimäki, 2007).
According to Kanaan, Masa’deh, & Gharibeh (2013),
BI is combination of data, knowledge about
company’s operational environment that leads to
creating competitive advantage for business.
BI is viewed as a way and process of improving
company performance by giving influential assistance
for executive decision maker to allow them to have
actionable data and information at hand (Kanaan,
Masa'deh, & Gharibeh, 2013). The basic quality for BI
tool is that it is talent to collect data from diverse
source, to acquire advance analytical methods, and the
skill to assist multi user’s demands (Ranjan, 2009).
C. Employee Retention
Retention is an intentional move by an organization to
build an environment which holds employees for long
term (Samuel & Chipunza, 2009). Most of the time
when these employees apart, they move to competing
organizations with the knowledge and internal secrets
obtained from their former organizations (Curado &
Bontis, 2007). The improvement has significantly
changed human resource performance in the area of
attracting accomplished employees into organizations,
and most significantly is the strategy for their
retention in organization (Yarbrough, Martin, &
Alfred, 2016).
If organization gets fail to retain employees then from
the outlook of remaining employees, high turnover
rates raise their normal workload (Guha &
Chakrabarti, 2015).
Such extra burdens increase the stress level of the rest
of the team members, employee retention is also
defined as loyalty depicted from worker side and
fulfillment of satisfaction from employer side
(Yarbrough et al., 2016). Employer must care about
psychological contracts. Once these contracts are
broken employees motivational level is badly effected
(Ibrahim, 2015). Their attitude toward the work also
starts diminishing (Roblek, Štok, Meško, & Erenda,
2013). There are five reasons for employee not willing
to retain in organization (Roblek et al., 2013):
1. Poor recruitment practices
2. Management style
3. Lack of appreciation
4. Lack of competition in the
5. Stressful workplace environment.
D. Turnover
Branham (2005) affirmed that turnover rate can be in
brief described as how quick the employers hire and
lose employees.
The involuntary turnover refers to the firing of
employees, while voluntary turnover occurs when
employees resign. While many studies have compared
these two divergent classifications, this study is
aiming to examine voluntary turnover specifically
(Branham, 2005).

Knowledge Management International Conference (KMICe) 2016, 29 – 30 August 2016, Chiang Mai, Thailand
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It is found that a continually high turnover rate de-
motivate the remaining employees by inspiring
training obligation to them. Motivation and attitude of
employees are key factors toward success. Goals and
objectives not require systems and machinery but the
people who run both (Ranjan, 2009). Hence,
organization opt for downsizing, outsourcing etc.
instead of turnover (Ranjbar & Amiri, 2015).
III METHODOLOGY
For this empirical research, qualitative research
technique is practiced for collection of adequate facts
and figures. It included secondary data of self-
interviews to executives and managers in corporate
sector, evaluation of existing literature and
comparison with previous, past researches, journal,
and articles and proposed models of BI to empowering
KM. Employee’s feedback is also considered by
secondary data resources while analyzing corporate
practical strategies. Past data is also preferred as proof
to their performance management activities within
organization as financial reports, market share and
customer service data bases. All those data are
collected trough secondary data for this paper
purposes.
Fig I: Building relationship between components of BI and
KM to maximize Employee Retention Rate: Proposed
Framework
The question session covers all aspects of BI to
empowering the KM significance for organizational
competitiveness in market place. Therefore, the
following key research questions are proposed:
1. What is the relationship between business
intelligence, knowledge management, and
employee retention in organizational context?
2. How business intelligence ensure to reduce
employees turnover rate?
3. How business intelligence empowering the
knowledge?
4. To what extent are BI and KM being used in
influencing retention and increase
competitiveness?
5. How does Business intelligence control
internal and external operations in competitive
environment?
6. How efficiently Knowledge management
build relation between employee and
workplace?
With superior tools of BI, now employees can also
easily convert their business information via the
systematic intelligence to solve many business issues
with technological advancement. In the light of
multiple views and arguments, the model is proposed
for KM and BI integration. Open ended questions
facilitated individuals to openly share their views.
Everyone was welcomed to participate and share his
knowledge and experiences. Thus, the role of both
fundamental elements are appreciable if practiced
effectively but to some extent organizations seem fail
to adopt them. People functioning in business
intelligence have developed tools that simplify the
work, particularly when the intelligence task involves
assembly and assessing large quantities of
unstructured data.
To obtain desired position in market without effective
BI to target process-oriented organizations is not
possible. Various problems on re-engineering in
business process are being focused. According to
Surbakti (2015), enterprises are on track of building
BI systems that support in analysis and decision
making to better recognize their operations and
compete in the marketplace (Surbakti, 2015a).
Further, we examined from certain sources of data that
companies still feel that BI has technical complexities
and serviceable only by technically specialists. They
also feel that BI is costly. BI takes a long time to yield
accurate analysis. However, Business Intelligence is
becoming need of the organizations who have to
handle big data (Gupta, Goul, & Dinter, 2015). Hence,
in this research different models regarding data
warehouse and data mining.
Data mining is component of BI that is heavily
inclined toward traditional statistical techniques and
even most data-mining methods reveal a strong base
of statistical and data analysis methods. DSS also

Knowledge Management International Conference (KMICe) 2016, 29 – 30 August 2016, Chiang Mai, Thailand
http://www.kmice.cms.net.my/ 16
come with results of valued processed information that
assist management to take business long term
decisions. Hence, Employees can treated in best
manners by adopting such strategic tools and can be
retained as valuable tangible assets.
IV CONCLUSION AND DISCUSSION
Today’s business environment has become very
competitive thus making skilled employees the major
differentiating factor for most organizations. The
present study assumed that managers in the
organizations have responsibility to properly
recognize and apply motivational variables that can
manipulate employees to stay in an Organization.
Replacing existing employee is expensive to
organizations and critical to competitiveness. These
key (termed knowledge workers) are particularly risky
since their value to the organization is fundamentally
intangible and not easily simulated. This is why senior
management must avoid more loss by codifying
intellectual assets in a deliberately planned knowledge
management system. By applying a knowledge
management strategy, the business can protect them
from knowledge erosion. This state of affairs demands
corporate executives to consider the consequences of
voluntary turnover to create contingent plans.
Fig II: Implementation phase of Proposed Model: KM & BI
role for employee retention
The above model illustrates that integration of good
BI in analyzing big data can improve and empowering
the knowledge in organizations. Thus, make possible
retention of employee on long term basis. Lack of
knowledge sharing among employees and
management causes frustration leading to confusion
and inefficiencies. Knowledge management and
business intelligence emphasize for employees
empowerment. Empowered employees have the
freedom to participate in decisions within
organization. Employment contract highlights the
significance of attracting and maintaining skilled
assets as the key to strategic employment in the
modern workplace. A lot of firm talent can be lost if
the employees experience attentive in dead-end
positions.
It is only a comprehensive blend of knowledge
management (KM) and business intelligence (BI)
motivational variables that can increase retention and
diminish the high rate of employee turnover in various
organizations.
The paper explored the concepts of BI, its
components, concepts of KM, turnover causes and
consequences, technology requirements, designing
and implementing business intelligence, and various
BI tools for competitiveness.
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