1.

Salary Hike:
a. Profitability: It would add to the costs of the company if it decides to
increase the salaries of the existing employees in order to retain them.
Thus, adversely affecting the profitability.
b. Employee Satisfaction: As per the recent observations of the
employees and their exit interviews, a major factor for motivating the
employees and retaining them today is a monetary incentive and not a
familiar and comfortable environment. Thus, this would improve employee
satisfaction to a large extent.
c. Gestation Period: The impact of this alternative is expected to take
place within the first two months as the salary hikes would have an
immediate impact on the mentality of the employee.

2. Increasing Managers involvement:

a. Profitability: The company would have to incur the training cost for the
managers to develop their interpersonal skills. Thus adversely affecting
profitability.
b. Employee Satisfaction: A greater involvement from his/her superior
would lead to a greater satisfaction for the employee.
c. Gestation Period: The gestation period of this policy would be around
12-15 months as it would take a significant amount of time to inculcate
this on an organizational level.