Does Flexibility of Employee–Management Relationship Influence the Operational Performance of Firms? A Case Study

Abstract

Employee turnover (ET) is a function of the employee–management relationship. To some extent it is good for the organization as it injects new blood and enhances productivity through innovations and creativity. Still, a gap exists between an employee–management relationship due to various factors such as comfort zone of employee and management. However, to a certain extent, such gaps are bearable, but beyond a specific degree of ET, it may have an adverse effect on the firms’ operations and performance. Our study aims to measure the influence of this flexibility in employee–management relationship beyond tolerable limit on the operational performance of firms with special reference to Tata Consultancy Services over the period of 2005–2018. We have applied descriptive statistics to understand the basic features of the relationship between employees and management. Simple linear regression model has been used to determine the relationship and influence of ET on operational performance, and owner’s equity. Our study revealed that ET explains significantly about net sales to total assets, net profit to total assets and operating profit to total assets. However, ET does not influence much of the net worth of the business.