Transformational Leadership and employee turnover intention: The mediating role of affective commitment.

Abstract

Leadership, an enabler of individual and collective efforts, is a crucial element that influences the wellbeing of both employees and their organizations. Over the last two and half decades, transformational leadership has become the most preferred subject in the leadership literature by both academics and practitioners (Bass and Avolio, 1990). For instance, transformational leaders are said to possess leadership behaviours such as intellectual stimulation, idealized influence, individualized consideration and inspirational motivation (Bass and Avolio, 2000; Bass, 1999).

Previous research have tested the positive impact of transformational leadership on work attitude and job satisfaction (Aryee et al., 2002), commitment and trust (Top et al., 2013), and tasks performance (Judge and Piccolo, 2004; Aryee and Chu, 2012) as well as negative influence on turnover intention (Alexandrov et al., 2004; Dupré and Day, 2007) and actual turnover (Burton and Peachey, 2009; Wells and Peachey, 2011). Furthermore, some studies in Ghana have examined the influence of leadership on outcomes such as job satisfaction (Aryee et al., 2002; Sanda and Kuada, 2013), organizational commitment and performance (Sanda and Kuada, 2013). However, there remains to be seen how affective commitment may connect transformational leadership to employee turnover intention. Affective organizational commitment was employed as the mediating variable because it is robust with strong reliability and validity (Meyer et al., 2002; Stazyk et al., 2011) and among the three-component model, it was found to correlate the strongest with both individual and organizational outcomes (Meyer et al., 2002). Also, the mechanisms that brings about the indirect effect of transformational leadership on turnover intention may be complicated than perceived by most management and business researchers. Additionally, concerns have been raised at the lack of context-specific research in leadership (Jordan et al., 2010; Liden and Antonakis, 2009; Schriesheim et al., 2009; Yukl, 1999). Hence, conducting a study of this nature in a segment of the non-bank financial sector in Ghana is both timely, imperative and warranted.

Following Sanda and Kuada (2013) and Yucel et al. (2013) studies in Ghana and Turkey, respectively, Ghana is a collectivist culture (Hofstede, 1980) and thus the Ghanaian context further provides support for a thorough insight into leadership research in a collectivist culture as opposed to the most leadership studies conducted in individualist cultures (Hofstede, 1980) in the UK and USA. Finally, due to the habitual poaching habit of most retail banks and the desire of most employees to work with the retail banks, it is perceived that low levels of transformational leadership may create feelings of discontent among employees in the SLCs and eventually increase their quitting intention. Hence, this study further aims to explore an understudied context for leadership in a developing economy like Ghana. This study focuses on SLCs because private enterprises like the SLCs drive economic growth through lowering the levels of real unemployment and strengthening the capacity of individual’s to care for themselves and their immediate families (Kuada, 2015; Barakatt and Sereke-Brhan, 2010; Nafukho and Muyia, 2010).

Drawing on Mercurio’s (2015) model of affective commitment as the core essence of organizational commitment and Kanter’s (1968) attitudinal commitment theory, our study sought to address these gaps in the literature by testing a mediated model of affective commitment with a sample of employees from the SLC in Ghana. First, we examine transformational leadership and affective commitment as antecedents of turnover intention. Second, we also examine the mediating role of affective commitment between transformational leadership and turnover intention.

Our study contributes to the literature in three ways. First, drawing on the affective commitment model and the attitudinal commitment theory, we argue that employees emotional attachment to and identification with the organization would decline their quitting intention and serves to promote a greater degree of trust and willingness to follow their leader’s guidance. Second, we make an empirical contribution to the extant literature by examining the mediated role of affective commitment in an organization within a collectivist culture, contrary to previous studies which have typically used samples from individualist cultures in the West (Hughes et al., 2010; Meyer et al., 2002). Besides the theoretical and empirical contributions, our study also make a significant practical contribution by providing advice to both middle and top managers on how to create an atmosphere of trust, admiration, loyalty and respect for employees which will in turn help to lessen their turnover intentions. The paper first and foremost presents the literature review. This is followed by the research framework and the research methods. Finally, the paper looks at the results as well as discussions and implications for future research.