ABSTRACT
The most important quality of human resources is the ability to transform organizations into an excellent entity by improving productivity and profitability. According to Davenport, (1999), organizations must be sensitive and cautious in choosing workforce so that workers are not a burden to the organization. However, challenges arise on how to ensure employees remain loyal and committed to their organizations? Beauregard et. al., (2009) added, if company are successful in overcoming this, then problem on employee turnover can be avoided In Malaysia Economic Report (2007), stated that SME is an important sector in the Malaysian economy. The sector provides almost one-third of the total employment and represents more than half of companies registered in the Companies Commission of Malaysia. In Malaysia, SME have been identified an important contributor in helping manufacturing sectors to produce components and auxiliary equipments. They are the pillars of downstream suppliers and service providers to large industries and multinational companies. When the first national car launched in 1983, SME have been leading the development of ancillary industries to support the use of local components required by the national car project. SME have contributed RM397.9 million or 10.8 percent of parts and components for the national car project in 1998, and increased tremendously to 77 percent in 2003.
