The competitive advantage can be gained in current era by efficient human resource management as it adds to the capacities related to production. Human resource management is becoming a major aspect of business management as it is the systematic approach to select, develop and retain the employees and assure them of their role as the part of the organization. humans add value to the business and thus it is important to care for their wellbeing.

All the resources can be copied by the competitors except the human capital as it is not easy to imitate because of distinctive in nature while the resources of capital and technology can be copied easily. Personnel of the organization is most important factors as these provide the organization with adaptability and flexibility to adjust particularly when changes are required.

The management needs to retain the best employees to develop a capable workforce so that the employees remain committed to the organization. This also facilitates attracting employees with additional qualities. This becomes crucial as the business environment is experiencing a shift of powers from employers to employees and can be reason for competitive advantage

The organization can do well by retaining the mediocre employees but it can flourish to exceptional levels by retaining those employees who are most capable. However, there is a risk of collapse of business if the employees do not have required qualities and skills to carry out job tasks. This expansion of organization either to the great extent or shift to the downfall is resultant of human resource management as it is the responsibility of HRD to develop the employees who are loyal and committed. However, retaining the employees is seen as the challenge to the human resource managers. The same problem is faced by the human resource managers at ABC Limited. The reports reveal that the turnover of the company until 2010 was very low i.e. 5%. However, a drastic increase in turnover rate is noticed in the last two years and has reached to 10%. This has become a major problem as these turnovers, especially in key managerial positions, created a gap in the operation which will take a significant time to close with a new hire. Employee retention can be achieved if the policies and practices of human resource are in place to promote employee satisfaction which will result in employees staying with the organization and their intention to leave is minimized. The need for employee retention is further justified due to the investments that are invested in the employees when they join an organization and during their time with the company. When talented employees leave the organization, losses are incurred in terms of recruitment, training and work productivity.

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