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SME Retention and Organizational Profitability

Introduction

This paper will review the relationship between subject matter experts and organizational success. The subject will require the focus to lie on organizational profitability and subject matter expert retention. It will answer two research questions. The first being as subject matter experts leave an organization is there a direct correlation with profitability decrease? The second question being do subject matter experts leave when there is a lack of organizational success? With the end goal of proving that a subject matter expert’s retention is imperative to the ongoing profitability of organizations.

Scope and Limitations of Research

The scope of this research study will be limited to prior research published in peer reviewed journals. With the one exception definitions of the terms. There are several terms referenced throughout this paper. The definition of these terms was taken from various websites.

Variables and Hypothesis

There are two variables that will be used for this study. The first being organizational profitability. The second being subject matter expert retention. Organizational profitability for the purpose of this study is defined as an organizations ability to turn a profit. Subject matter expert retention is defined as companies’ ability to retain their subject matter experts. Based on prior research completed within these two subjects this paper should be able to show that the more subject matter experts an organization is able to retain, the more profitable they will be.

Significance of Research

If subject matter experts are the one of the many cogs in the profitability wheel. Understanding the need to keep them within their current organization and how it affects profitability. Can help guide organizations towards a more profitable future.

Subject Matter Expert Definition

To help understand the relevance of this topic. It will help to step back and explain what a subject matter expert or SME is. According to OPM.GOV the definition of a subject matter expert is A subject matter expert, or SME, is a "person with bona fide expert knowledge about what it takes to do a particular job.  First-level supervisors are normally good SMEs. Superior incumbents in the same or very similar positions and other individuals can also be used as SMEs if they have current and thorough knowledge of the job's requirements". This particular example is related to project management and how you adequately capture business requirements for change process. However this could be applied to every day work of various roles. Lets take the role of the business analyst as a example as noted on business-analysis-excellence.com Although this role as a Business Analyst is solid and likely to have a good knowledge base of Business Analysis approaches and techniques, this role runs the risk of transforming into a subject matter expert role because all work is done within the same domain.

Question 1

When an organization loses its subject matter experts, the ones it can count to come through when in need is there a loss in profitability for the organization? This would seem like the question would answer itself. As an organization loses its knowledgeable staff and replaces them with less experienced employees there should be loss in turnaround times, there should be more mistakes etc. There are several studies that review the effect of SME retention on organizations. For the purpose of this paper we will review three. According to Pittino, Visintin, Lenger and Sternad (2016), High performing employee exits can remove the competitive edge that companies have in financial performance and productivity. Are high performing employee’s subject matter experts? According to hrzone.com, High performers are people who are highly competent and possess the necessary skills needed for a job. Based on the previous definition of subject matter experts in this paper, that they possess the skills or experience necessary to accomplish the job. One could argue that based on this definition that they are.  In other words, they are people who are the best fit for the job. According to Gberevbie (2008), there is a direct linkage between organization and performance, employee retention strategies. There is a sliding scale between the two, the less adequate the strategy, the less likely the organization is to perform (Gberevbie, 2008). Staff retention and organizational performance are related in such away to have a direct effect on profitability (Gberevbie, 2008). Why do subject matter experts matter so much to organization profitability? Is it due to their vast knowledge of the systems they support? Their ability to navigate the political climates of the organization that they have become so intimately familiar with over the course of their tenure? According to Abdul-Jalal, Toulson and Tweed (2013), knowledgably employees add value to organizations that give them a competitive advantage. (Abdul-Jalal, Toulson, and Tweed, 2013).

Question 2

Do subject matter experts leave because companies are less than profitable? This question is the anti-question to question one. If subject matter experts leave when an organization is on a downward spiral. Then it would stand to negate the studies done one question one. In example if they leave for this reason instead of being let go. Then the fact that they left the organization has nothing to do with the actual lack in profitability. Finding peer reviewed research on this question was difficult at best. The only information that could be found in the time allotted revolves around employees in general not subject matter experts. In example according to Bergman and Scarpello (2001), employees are more inclined to stay and work when the organization is stable and friendly working environment. This does not specifically call out subject matter experts. Granted subject matter experts are part of the population as whole. However for this study subject matter experts are being viewed as sub population of the workforce that’s behaviors are different than that of the general population. The studies found here where to general to develop a conclusive answer.

Conclusion

The goal of this paper was to prove that there is a relationship between the number of subject matter experts retained and organization profitability. To help prove this relationship two research questions were reviewed. The first one being is there a direct link between organizational profitability and subject matter expert retention. During review of this question several previous studies where reviewed. These studies all prove that there is a link. During this research I was unable to find studies that proved otherwise. The second research question asked was do subject matter experts leave organizations as they become less profitable. This question was asked due to its potential negative effect on this research. If this was true than the results of the first question would be potentially questioned. During the review of this question no research specific to subject matter expert was found. There were several studies that show employee leave organizations as a whole as it becomes less profitable. Due to the scope of these studies the results of this research question were inconclusive. The hypothesis proposed in this paper was the more subject matter experts an organization is able to retain. The more profitable they will be. Based on the limited research completed in this study. More research is needed to understand this relationship.

References

Abdul-Jalal, Hayati, &Toulson, Paul, & Tweed, David (2013). Knowledge Sharing Success for Sustaining Organizational Competitive Advantage. Procedia Economics and Finance, 7, 150 – 157.

Gbervevbie, Daniel Eseme (2008). Employee Retention Strategies and Organizational Performance. An International Journal of Psychology in Africa, 16, 131 – 152

Chowdhury, Abdullah & Al, Mamun & Nazmul, Hasan(2017). Factors affecting employee turnover and sound retention strategies in business organizations: a conceptual view. Problem and Perspectives in Management, 15(1), 63-71.

Bergmann, T. J. and Scarpello, V. G. (2001) Compensation Decision Making (4th ed.). Harcourt, Fort Worth, TX.

n.d.OPM.GOV. Retrieved from https://www.opm.gov/FAQs/QA.aspx?fid=a6da6c2e-e1cb-4841-b72d-53eb4adf1ab1&pid=c9d6d33b-a98c-45f5-ad76-497565d58bcf

.hrzone.com. Retrieved from https://www.hrzone.com/community-voice/blogs/elan/qualities-of-high-performing-employees

& n.d.Business Analysis Excellence. Retrieved from http://business-analysis-excellence.com/role-of-business-analyst/

https://www-sciencedirect-com.ezproxy.uttyler.edu/science/article/pii/S2212567113002293