Impact of leadership quality on employee retention

Leadership and relationships play a key role in organizational success. The approach of superior to subordinates determines the quality of relationship. This tone of relationship between them either positive or negative has a strong say in the success or failure of the organization. Though the objective of either, on organizational and employee view is common, yet the human approach from the top determines the retention of employees apart from other essential needs as mentioned by Maslow.

The style adopted by managers in organizations is likely to have impact with the performance of employees. In the present days were the quality of workforce has improved manifold, the practice of Authoritative or Autocratic style would result in retreat and not in progress. It would lead to stress and result in burnout in employees’ perspective and to employer poor quality production or less production leads to attrition of experienced employees.

Leadership is the capability of a person to lead and influence others. A leader is a person who has leadership qualities, or the one who leads. Robert Tannebaum therefore, defined leadership as interpersonal influence exercised in a situation and directed through the communication process, towards the attainment of a specialized goal or goals.

The behaviour or the leadership style, a superior adopts may considerably determine the orientation of the subordinates. As, how a manager has expectations of his subordinates, so too the subordinates expect their superior to behave in certain manner. It is necessary for every manager to fit his behavior within the expectation level of his subordinates and superiors for a healthy balanced relationship. Today the scarcity is not on the efficiency but on how well one is able to influence others in getting the quality work done. Failing which, will cause non-co-operation resulting sabotage, hardwork or unidentification results in lack of interest and losing interest results low production, turning the organization sick and leads to higher attrition rate.

Therefore, the manager is a person who embarks on the importance of human values and emotions. His importance in the organization does not merely lies on the implementation of the policies of the management but inturn should understand the employees acceptance for their comfortable work environment. Not considering the importance on employee retention will leave the organization in holding employees of only routine skills and lose people with talents. Managers could improve retention rates by creating amiable work environment for the motivating employees.

The skill sets of employees in the recent days are very significant. To how best these skill sets could be utilized from the employees for the benefit of the organization’s growth is quite a challenging task for the manager. There are instances where the employees prove themselves to be more efficient than the manager. Therefore charting the target and implementing the work towards the target, from the employees perview is not at all a difficult task.

As a manager, the responsibilities relies in identifying the employees and delegating the work based on the skill sets and making them feel at ease in the work environment. With this initiation it is necessary for him to navigate, if the channel of work is soothing and human values are connected in a healthy way. The inculcation of organizational values and trustworthiness is predominant as a leader manager.

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An employee in an organization is not an investor of finance but of efficiency. Employees comprise the most vital assets of the company. He expects compensation for his contribution and not a profit share. His satisfaction on compensation and viable work environment is a motivating factor for the organizational growth. The manager’s intervention during the time of inconveniences would make them feel identified and feel their presence wanting to the organization. This attitude of, willing employees would make the work environment positive towards the development of the organization. This concept of willing employee and comfortable leader is the days demand in every organization. For availability of unbounded resources and innovation, the driving operational force is the magical wand of the positive social approach by the managers. The changes in the willingness to exist with the industry and comfort ability of the managers would result in retention.

Willing Employee and uncomfortable Leader

Distance & Avoidance – Leads to lack of work update

Inspite of hardwork – effort unrecognized, feel isolated and lose


Resources never revealed – work planning impossible

Lacks involvement – timely work suffers

Wrong interpretation by peers – hatred towards the employee

Employee Burn Out – loss of positive resources

Unwilling employee and Uncomfortable leader

Manipulate – makes use of negatives in an unhealthy way for the org.growth

Less productive – remain unnoticed

Creates groupism – try to win over the majority in hiding the flaws

Organizational conflict – question of industry’s existence

Need for Organisational change and development in both aspects.

Unwilling employee and comfortable leader

Manipulate – finds cause and try to rectify action

Less productive – motivate by training and development to become more productive

Creates groupism – understand the cause for groupism and calls forth for the

Employee redressal forum

Organizational conflict – identify the required interventions for finding a solution

Willing employee and comfortable leader

High values – respect

High quality – motivation

Needs fulfilled – ensures organisational long term growth

Increased production with less – appraisal


Approachable – any inconveniences learnt and jointly finds ways

and means for rectification

Positive attitude – added responsibility to support the group


Better relationship among employees – work planned easily and target fixed with

practical possibility

Innovative – organizational growth & expansion

In a work place where employees are not able to use their full potential and not heard and valued, they are likely to leave because of stress and frustration whereas in a transparent environment the employees get a sense of achievement and belongingness from a healthy

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work environment by which , the company is benefited with a stronger, reliable work-force, harboring bright new ideas for its growth.

Leadership Makes a Difference

The style followed by every manager encompass the employees on various aspects like job satisfaction, high production, quality , achieving the target, less rejection, job involvement. It is understood from the earlier studies that the leadership style matters for job retention.

â-ª After 20 years of research and 60,000 exit interviews, the Saratoga Institute

reports that 80% of turnover is directly related to unsatisfactory relationships with one’s boss.

â-ª According to a recent Gallup Organization study of approximately 1 million workers, the number one reason people leave their jobs is because of “bad bosses.”

â-ª Another recent Gallup study found poorly managed workgroups are an average of 50 percent less productive and 44 percent less profitable than well-managed groups.

â-ª.A conclusion reached by Roger Herman is that 3/4 of people voluntarily leaving jobs don’t quit their jobs; they quit their bosses. (Herman, Roger. Winning the War for Talent. The ASTD Trends Watch: The Forces That Shape Workplace Performance and Improvement. American Society for Training And Development, pp. 23-32, 1999, p. 28)

Blake mouton’s managerial grid theory determines a manager’s leadersipstyle on two behavioural aspects, i.e., on its concern for people and concern for production. The former builds better harmony in work environment while the latter work towards the organizational goal. In his leadership style of Team Management he emphasizes the leader to have concern for high production and high people concern. According to him, these leaders stress production needs and the needs of the people equally highly. The premise here is that employees are involved in understanding organizational purpose and determining production needs. When employees are committed to, and have a stake in the organization’s success, their needs and production needs coincide. This creates a team environment based on trust and respect, which leads to high satisfaction and motivation and, as a result, high production.

The satisfaction level of employees determines the agreement/disagreement with their leader based on his style and approach. This approach has a strong say in rating the level of employee retention.

The leader plays a key role in employee retention and retention management. The leader is the main factor in what motivates people’s decision to stay or leave. For organizations to keep its key employees their number one priority should be to look at their management, because people leave managers and not companies. Characteristics in a leader that are of prime importance are – trust builder, esteem builder, communicator, talent developer and coach, and talent finder. The leader’s relation to the employees plays a central role in retaining employees.

Building rich retention starts from the first day of employment.

Organisations’s outlook:

Ensuring right job to a right person. The necessity of the job, designing the tasks, responsibilities, and expectation from the job and position.

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Orientation on organisation’s goals and values.

Making the physical and social environment feel comfortable by introduction, support and training programmes.

Clarity of job. Any job should be a part of the whole. The support to be saught for the completion of the task and the support to be given to the carryover of the task.

Being open to suggestions and giving feedback.

Timely appreciations and corrections will build better rapport on work and social behaviour.

Clarity on compensation , its revision scale schedule and periodical performance appraisal.

Greivance redressal forum

Considering the welfare of the employees, who in turn will value the organizations’ welfare.

Clear communication on organizational expectations and its policies is important.

Manager’s outlook:

A person, approachable with passion.

Be a role model of integrity.

Uniform approach to his people irrespective of the positions held. No favoritism.

Good and unbiased listener.

Analysed decision making. Tough situations to be dealt from solution point of view rather than treating as problem.

Look for increasing managerial skills in winning people who do their work with duty conscious. Attending leadership training programmes will help to focus on the employees retention.

Giving values to the employees say.

Setting procedures

Non – egoistic

Knowledgeable person

With these outlook an employee would work to the expectations of the management. Some people work for love; others work for personal fulfillment. Others like to accomplish goals and feel as if they are contributing to something larger than themselves, something important. Some people have personal missions they accomplish through meaningful work. Others truly love what they do or the clients they serve. Some like the camaraderie and interaction with customers and coworkers. Other people like to fill their time with activity. Some workers like change, challenge, and diverse problems to solve. What so ever may be, the ultimate expected reward is the monetary benefit. Fair benefits and pay are the cornerstone of a successful company that recruits and retains committed workers. If you provide a living wage for your employees, you can then work on additional motivation issues. Without the fair, living wage, however, you risk losing your best people to a better-paying employer.

Mandatory Disclosure



            The Concept and Creative Head


            National Conference on Business Strategies for Sustainable Growth

            Department of Management Studies

            Karpagam College of Engineering


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I solemnly certify that the paper titled “Impact of leadership quality on employee retention” authored by Dr./Prof./Mr./Ms._Sudharani.S has not been published or accepted for publication elsewhere or currently under any other review  

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Name :   Sudharani.s                                                 

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