Turnover intentions of employees of information technology outsourcing suppliers in Vietnam

Voluntary employee turnover creates considerable direct and indirect cost for a company. It can also harm customers. In the case of information technology (IT) outsourcing, the turnover often decreases the quality of delivered services because the newly assigned employees need to adjust to the new tasks and customer. Reports indicate that turnover of IT employees in offshore locations is very high. The research on this phenomenon is still limited and inconclusive, but there are indications that the standard model of employee turnover developed for Western industrialised countries does not apply equally for emerging economies, which are prime destinations for IT outsourcing. We analyse which factors determine employee turnover at IT outsourcing suppliers in Vietnam, a growing IT outsourcing destination. The results show that compensation and job alternatives play an important role, as in Western countries. However, relationships with superiors and peers also significantly affect employee turnover intention, which reflects cultural differences.