Leadership styles towards employee retention in hotel industry: a study in Sibu Town, Sarawak
List of Authors
  • Chan, Herbert Geh Ming , Mohd Zainal Munshid Harun , Wong, Winnie Poh Ming

Keyword
  • Directive, employee retention, hotel industry, laissez-faire, leadership styles, participative, servant

Abstract
  • The nature of leadership itself may influence an individual employee’s intention to leave or remain in the organisation. The present study was carried out to examine the impact of directive, servant, participative, and laissez-faire leadership styles in predicting employee retention among employees working in hotels of Sibu Sarawak. Using Role Theory as the underpinning basic theory, the present study explains the relationship between the chosen variables in the proposed model. A quantitative research design was chosen for this research study. WarpPLS (version 6.0) was employed to perform the Partial Least Square-Structural Equation Modeling (PLS-SEM) estimation procedure to examine the developed direct relationship. The purposive sampling technique was used for data collection. A total of 230 usable questionnaires were collected from employees coming from different levels/department in local hotels. Interestingly, the results showed that two predictive factors emerged from the directive and servant leadership styles, which are prevalent in employee retention in the hotel industry. The result of present study may be informative and act as a basic guideline for the future hotel industry players. Additionally, the research is of theoretical importance as it helps to identify the factors that contribute to hotel employee retention. This study also demonstrates the importance of effective leadership style/leadership behaviour for the retention of talented employees in the hotel industry. Some of the theoretical and practical implications have also been highlighted in the study.

Reference
  • 1. Adair, J. (2003). Not bosses but leaders: How to lead the way to success (3rd ed.). London: Kogan Page.
    2. Adekanbi, A. F. (2016). An investigation into the impact of leadership style on employee retention: Identifying which leadership style best encourages employee retention in the Nigerian banking sector. A case study of Zenith Bank Plc., Nigeria. Unpublished Dissertation, National College of Ireland, Ireland.
    3. Ahearne, M., Mathieu, J., & Rapp, A. 2005. To empower or not to empower your sales force? An empirical examination of the influence of leadership empowerment behavior on customer satisfaction and performance. Journal of Applied Psychology, 90(5), 945–955.
    4. Akter, S., D’Ambra, J., & Ray, P. (2011). An evaluation of PLS based complex models: The roles of power analysis, predictive relevance and GoF index, In Proceedings of the Seventeenth Americas Conference on Information Systems, August 4th-7th, Detroit, Michigan.
    5. Ali, A. H., Ismael, A. J., Sulaiman, M., & Nikbin, D. 2011. The impact of personality and leadership styles on leading change capability of Malaysian managers. Australian Journal of Business and Management Research, 1(2), 70-98.
    6. Amzat, I. H. & Ali, A. K. 2011. The relationship between the leadership styles of heads of departments and academic staff’s self-efficacy in a selected Malaysian Islamic University. Interdisciplinary Journal of Contemporary Research in Business, 3(1), 940-964.
    7. Aruna, M. & Anitha, J. 2015. Employee retention enablers: Generation Y employees. SCMS Journal of Indian Management, July – September, XII (3).
    8. Atilgan, C. & McCullen, P. 2011. Improving supply chain performance through auditing: A change management perspective. Supply Chain Management: An International Journal, 16(1), 11-19.
    9. Bagozzi, R. & Yi, Y. 1988. On the evaluation of structural equation models. Journal of the Academy of Marketing Science, 16(1), 74-94.
    10. Barbuto, J. E., Jr. & Wheeler, D. W. 2006. Scale development and construct clarification of servant leadership. Group & Organisation Management, 31(3), 300-326.
    11. Barroso, C., Carrión, G. C., & Roldán, J. L. (2010). Handbook of partial least squares: Concept, methods and applications. In Esposito, et al. (Ed.), Applying maximum likelihood and PLS on different sample sizes: Studies on SERVQUAL model and employee behavior model. (pp. 427-447). Germany: Springer-Verlag Berlin Heidelberg.
    12. Bass, B. M. & Avolio, B. (2000). Multifactor leadership questionnaire: Manual leader form, rater, and scoring key for mlq (Form5x-Short). Redwood City, CA: Mind Garden.
    13. Bass, B. M. & Avolio, B. J. (1997). Full Range Leadership Development: Manual for the Multifactor Leadership Questionnaire. Palo Alto, CA: Mindgarden.
    14. Bass, B. M. & Riggio, R. E. (2006). Transformational leadership (2nd ed.). Mahwah, NJ: Lawrence Erlbaum Associates Inc.
    15. Bass, B. M. & Stogdill, R. M. (2008). Bass and Stogdill's Handbook of leadership: Theory, research and managerial applications (vol 4). New York: Free Press.
    16. Bass, B. M. 1981. Personal selling and transactional/ transformational leadership. Journal of Personal Selling and Sales Management, 7(3), 19–28.
    17. Bass, B. M. (1985). Leadership and performance beyond expectations. New York: Free Press.
    18. Bass, B. M. (1990). Bass and Stogdill‟s handbook of leadership, theory, research, and managerial applications (3rd ed.). New York: Free Press.
    19. Bell, C. & Mjoli, T. Q. 2014. The effects of participative leadership on organizational commitment: Comparing its effects on two gender groups among bank clerks. African Journal of Business Management, 8(12), 451-459.
    20. Bittel, L. R. (1989). The McGraw-Hill 36-hour management course. New York: McGraw-Hill.
    21. Chen, N. Y. F. & Tjosvold, D. 2006. Participative leadership by American and Chinese managers in China: The role of relationships. Journal of Management Studies, 43(8), 1727-1752.
    22. Cherry, K. (2019). Leadership styles. Retrieved on July 28, 2019 from https://s3.amazonaws.com/academia.edu.
    23. Chew, J. C. L. (2004). The influence of human resource management practices on the retention of core employees of Australian organisation. Unpublished doctoral dissertation, Murdoch University.
    24. Chin, W. W. 1998. Issues and opinions on structural equation modeling. MIS Quarterly, 22(1), 7-16.
    25. Chin, W. W. (2010). In Esposito Vinzi, V., Chin, W.W., Henseler, J. and Wang, H., Eds., Handbook of Partial Least Squares: Concepts, Methods and Applications. How to write up and report PLS analyses. (pp. 655-690). New York: Springer.
    26. Chow, W. S. & Chan, L. S. 2008. Social network, social trust and shared goals in organizational knowledge sharing. Information and Management, 45, 458-465.
    27. Coad, A. F. & Berry, A. J. 1998. Transformational leadership and learning orientation. Leadership and Organization, 19(3), 164–172.
    28. Coggins, E. D. & Bocarnea, M. C. 2015. The impact of servant leadership to followers’ psychological capital: A comparative study of evangelical Christian leader-follower relationships in the United States and Cambodia. Journal of Leadership, Accountability and Ethics, 12(4), 111–144.
    29. Dolatabadi, R. H. & Safa, M. 2011. The effect of directive and participative leadership style on employees’ commitment to service quality. Journal of Business and Management, 4(2), 1117-3653.
    30. Fincham, R. & Rhodes, P. (2005). Principles of organizational behaviour (5th ed.). New York: Oxford University Press.
    31. Fornell, C. & Larcker, D. 1981. Evaluating structural equation models with unobservable variable and measurement error. Journal of Marketing Research, 18(1), 39-50.
    32. Foster-Fishman, P. G., Salem, D. A., Chibnall, S., Legler, R., & Yapchai, C. 1998. Empirical support for the critical assumptions of empowerment theory. American Journal of Community Psychology, 26(4), 507–536.
    33. Frank, F. D., Finnegan, R. P., & Taylor, C. R. 2004. The race for talent: Retaining and engaging workers in the 21st century. People of Strategy, 27(3), 12-25.
    34. Fry, L.W. 2003. Toward a theory of spiritual leadership. The Leadership Quarterly, 14(6), 693-727.
    35. Gill, E. (2014). What is Laissez-faire Leadership? How autonomy can drive success. Retrieved November 25, 2014 from http://online.stu.edu/laissez-faire- leadership.
    36. Gillet, J., Cartwright, E., & Van Vugt, M. 2011. Selfish or servant leadership? Evolutionary predictions on leadership personalities in coordination games. Personality and Individual Differences, 51(3), 231-236.
    37. Glebbeek, A. C. & Bax, E. H. 2004. Is high employee turnover really harmful? An empirical test using company records. Academy of Management Journal, 47, 277-286.
    38. Gold, A. H., Malhotra, A., & Segars, A. H. 2001. Knowledge management: An organisational capabilities perspective. Journal of Management, 18(1), 185-214.
    39. Gordon, T. (1955). Group-centered Leadership: A way of releasing the creative power of groups. Boston: Houghton Mifflin.
    40. Govaerts, N., Kyndt, E., Dochy, F., & Baert, H. 2011. Influence of learning and working climate on the retention of talented employees. Journal of Workplace Learning, 23(1), 35-55.
    41. Greenleaf, R. K. (1977). Servant leadership: A journey into the nature of legitimate power and greatness. New York: Paulist Press.
    42. Greenleaf, R. K., Frick, D. M., & Spears, L. C. (1996). On becoming a servant-leader. San Francisco: Jossey-Bass Publishers.
    43. Guest, D. 2017. Human resource management and employee well-being: Towards a new analytic framework. Human Resource Management Journal, 27(1), 22-38.
    44. Gutierrez-Wirsching, S. (2018). The relationship between motivating language and servant leadership. Unpublished Phd dissertation. Texas A&M International University.
    45. Hair, J. F., Black, W. C., Babin, B. J., & Anderson, R. E. (2010). Multivariate data analysis (7th ed.). United State: Pearson Education.
    46. Hair, J., Ringle, C., & Sarstedt, M. 2013. Partial least squares structural equation modeling: Rigorous applications, better results and higher acceptance. Long Range Planning, 46, 1-12.
    47. Hajjaj, K.G. 2014. Relationship between servant leadership style and intent to stay among the employees in the Municipality of Gaza. International Journal of Business and Social Science, 5(7), 95-101.
    48. Halawi, L. & McCarthy, R. 2008. Measuring students perceptions of blackboard using the Technology Acceptance Model: A PLS approach. Issues in Information Systems, 9(20), 95-102.
    49. Heneman, R. L. & Gresham, M. T. (1999). The effects of changes in the nature of work on compensation. USA: Ohio State University.
    50. Henseler, J., Ringle, C. M., & Sinkovics, R. R. 2009. The use of partial least squares path modeling in international marketing. Advances in International Marketing, 20, 277-319.
    51. Herbert, S. L. (2005). A comprehensive literature review and critical analysis of servant leadership theory. Unpublished master dissertation, University of Wisconsin-Stout.
    52. Hong, K. S., Mustafa, R., Songan, P., Hasbee H. U., Gan, S. L., & Ngui, K. S. (2009). Relationships between leadership behaviours, university culture and leadership effectiveness for academic work in Malaysian Public Universities. Universiti Malaysia Sarawak, Kota Samarahan.
    53. Huang, X., Iun, J., Liu, A., & Gong, Y. 2010. Does participative leadership enhance work performance by inducing empowerment or trust? The differential effects on managerial and non-managerial subordinates. Journal of Organizational Behavior, 31(1), 122–143.
    54. Indvik, J. (1985). A path-goal theory investigation of superior-subordinate relationships. Unpublished Phd thesis. University of Wisconsin-Madison.
    55. Ittner, C. D. & Larcker, D. F. (2002). Determinants of performance measure choice in work incentive plans. Chicago, USA: Sunrise Printery.
    56. Jones, D. & Rudd, R. 2008. Transactional, transformational, or laissez-faire leadership: An assessment of college of agriculture academic program leaders’ (deans) leadership styles. Journal of Agricultural Education, 49(2), 88-97.
    57. Kelloway, E. K., Turner, N., Barling, J., & Loughlin, C. 2012. Transformational leadership and employee psychological well-being: The mediating role of employee trust in leadership. Work and Stress, 26(1), 39-55.
    58. Kline, R. (2011). Principles and practice of structural equation modelling (3rd ed.). New York: Guilford Press.
    59. Kock, N. & Hidaya, P. 2018. Minimum sample size estimation in PLS-SEM: The inverse root and gamma-exponential methods. Info Systems Journals, 28(1), 227-261.
    60. Lewin, K., Lippitt, R., & White, R. K. 1939. Patterns of aggressive behaviour in experimental created ‘Social Climates’. Journal of Science Psychology, 10(2), 271-299.
    61. Luthar, H. K. 1996. Gender differences in evaluation of performance and leadership ability. Autocratic vs. democratic managers. Sex Roles, 35(5–6), 337–361.
    62. Manly, B. E. J. (2001). Randomization, bootstrap, and monte carlo methods in biology (2nd ed.). Boca Raton: Chapman & Hall.
    63. Mat, J. (2008). The influence of leadership style on internal marketing in retailing. Unpublished PhD thesis. University of Stirling.
    64. Mathieu, J. E. & Zajac, D. M. 1990. A review and meta-analysis of the antecedents, correlates, and consequences of organizational commitment. Psychological Bulletin, 108(2), 171-194.
    65. Merton, R. M. 1957. The role set. British Journal of Sociology, 8, 106-120.
    66. Muindi, F. (2010). The relationship between participation in decision making and job satisfaction among academic staff in the school of business university of Nairobi. Unpublished master dissertation. University of Nairobi.
    67. Netswera, F.G., Rankhumise, E. M., & Mavundila, T. R. 2005. Employee retention factors for South African higher education institutions: A case study. SA Journal of Human Resource Management, 3(2), 36-40.
    68. Newman, A., Rose, P., & Teo, S. T. T. 2012. The role of participative leadership and trust-based mechanisms in eliciting intern performance: Evidence from China. Human Resource Management, 55(1), 56-67.
    69. Northouse, P. G. (2010). Leadership: Theory and practice (5th ed.). Thousand Oaks, CA: Sage.
    70. Ojo, O. 2009. Leadership behavior and organization transformation: A theoretical and empirical analysis. Annals of University of Bucharest, Economic and Administrative Series, 3, 185-199.
    71. Patterson, K. (2003). Servant leadership: A theoretical model. Unpublished PhD dissertation. Regent University.
    72. Pauw, D. (2011). The influence of leadings’ personality types and emotional intelligence on retention factors. Unpublished Master Thesis. University of South Africa.
    73. Pelz, D. C. 1956. Some social factors related to performance in a research organization. Administrative Science Quarterly, 1, 310-325.
    74. Puni, A., Agyemang, C. B., & Asamoah, E. S. 2016. Leadership styles: Employee turnover intentions, and counterproductive work behaviours. International Journal of innovative Research and Development, 5(1), 1-8.
    75. Puni, A., Ofei, S. B., & Okoe, A. 2014. The effect of leadership styles on firm performance in Ghana. International Journal of Marketing Studies, 6(1), 177-185.
    76. Rad, A. M. M. & Yarmohammadian, M. H. 2006. A study of relationship between managers’ leadership style and employees’ job satisfaction. Leadership in Health Services Journal, 19(2), 11-28.
    77. Rai, R. & Prakash, A. 2012. A relational perspective to knowledge creation: Role of servant leadership. Journal of Leadership Studies, 6(2), 61-85.
    78. Ramayah, T., Cheah, J., Chuah, F., Ting, H., & Memon, M. (2018). Partial least squares structural equation modeling (PLS-SEM) using Smart PLS 3.0 (2nd ed.). Kuala Lumpur, Malaysia: Pearson Malaysia Sdn Bhd.
    79. Randeree, K. & Chaudhry, A. G. 2012. Leadership – style, satisfaction and commitment: an exploration in the United Arab Emirates’ construction sector. Engineering, Construction, and Architectural Management, 19(1), 61-85.
    80. Rieke, M., Hammermeister, J., & Chase, M. 2008. Servant leadership in sport: A new paradigm for effective coach behavior. International Journal of Sports Science & Coaching, 3(2), 226-239.
    81. Robertson, J. C. (2013). Leadership styles and intention to quit among southern baptist pastors. Unpublished PhD dissertation. Tennessee Temple University.
    82. Roscoe, J. T. (1975). Fundamental research statistics for the behavioural sciences (2nd ed.). New York: Holt Rinehart and Winston.
    83. Sagnak, M. 2016. Participative leadership and change-oriented organizational citizenship: The mediating effect of intrinsic motivation. Eurasian Journal of Educational Research, 62, 181-194.
    84. Sekaran, U. (1992). Research methods for business: A skill-building approach. New York: John Willey & Sons.
    85. Sherman, D. K. & Cohan. G. L. 2006. The psychology of self-defence: Self-affirmation theory. Advances in Experimental Social Psychology, 38, 183-242.
    86. Skakon, J., Nielsen, K., Borg, V., & Guzman, J. 2010. Are leaders’ well-being, behaviours and style associated with the affective well-being of their employees? A systematic review of three decades of research. Work and Stress, 24, 107-139.
    87. Skogstad, A., Einarsen, S., Torsheim, T., Aasland, M. S., & Hetland, H. 2007. The destructiveness of laissez-faire leadership behaviour. Journal of Occupational Health Psychology, 12(1), 80-92.
    88. Skogstad, A., Hetland, J., Glasø, L., & Einarsen, S. 2014. Is avoidant leadership a root cause of subordinate stress? Longitudinal relationships between laissez-faire leadership and role ambiguity. Work and Stress, 28(4), 1-21.
    89. Somech, A. 2005. Directive versus participative leadership: Two complementary approaches to managing school effectiveness. Educational Administration Quarterly, 41(5), 777-800.
    90. Stoner, J. A. F. (1982). Management (2nd ed.). Englewood Cliffs, NJ: Prentice.
    91. Sun, P. Y. 2013. The servant identity: Influences on the cognition and behaviour of servant leaders. The Leadership Quarterly, 24(4), 544-557.
    92. Tenenhaus, M., Vinzi, V. E., Chatelin, Y. M., & Lauro, C. 2005. PLS path modeling. Computational Statistics & Data Analysis, 48(1), 159-205.
    93. Thiriku, M. & Were, S. 2016. Effect of talent management strategies on employee retention among private firms in Kenya: A case of data centre LTD-Kenya. International Academic Journal of Human Resource and Business Administration, 2(2), 145-157.
    94. Van Dierendonck, D. & Jacobs, G. 2012. Survivors and victims, a meta-analytical review of fairness and organizational commitment after downsizing. British Journal of Management, 23(1), 96–109.
    95. Verhagen, T. & Van Dolen, W. 2009. Online purchase intentions: A multi-channel store image perspective. Information and Management, 46, 77-82.
    96. Voorhees, C. M., Brady, M. K., Calantone, R., & Ramirez, E. 2016. Discriminant validity testing in marketing: an analysis, causes for concern, and proposed remedies. Journal of the Academy of Marketing Science, 44(1), 119-134.
    97. Wilson, J. M., George, J., Wellins, R.S., & Byham, W.C. (1994). Leadership trapeze: Strategies for leadership in team based organizations. San Francisco: Jossey-Bass Publishers.
    98. Winkler, I. (2009). Contemporary leadership theories: Enhancing the understanding of the complexity, subjectivity and dynamic of leadership. New York: Springer.
    99. Xirasagar, S. 2004. Transformational, transactional, and laissez-faire leadership among physician executives. Journal of Health Organization and Management, 22(6), 599-613.
    100. Yaseen, A. 2010. Leadership styles of men and women in the Arab world. Education, Business and Society: Contemporary Middle Eastern Issues, 3(1), 63-70.
    101. Yousef, D. A. 2000. Organizational commitment: A mediator of the relationships of leadership behavior with job satisfaction and performance in a non-western country. Journal of Managerial Psychology, 15(1), 6-24.
    102. Yukl, G. A. 1989. Managerial leadership: A review of theory and research. Yearly Review of Management, 15(2), 251-289.
    103. Yukl, G. A. 2008. How leaders influence organizational effectiveness. The Leadership Quarterly, 19(6), 708-722.