In the current economic climate, redundancies, budget reductions and pay cuts are commonplace leading to low morale for those staff fortunate enough to have remained in employment. It is in times like these that individuals with leadership responsibilities need to place significant emphasis on their own leadership effectiveness, which in turn leads to employee satisfaction (Folkman, 2010:1). According to Stewart (2002, cited in Kelly, 2004:142) people want to work for effective leaders because they get employees to share and people who share tend to stay together.
However, although effective leadership is clearly important for ensuring the ongoing commitment of staff, evidence has shown that there are numerous factors which may incite individuals to leave organisations, some of which are related to effective leadership. The proposal is to study this area further, the rationale being that by exploring the reasons ‘why’ individuals leave organisations. Previous studies have found many factors that affect employee decision to leave organisation. For instance, according to Curtis and Wright (2001), one of the important indicators in this regard is lack of organisational commitment. Organisational commitment is affected by practices and norms of the organisation (Kaliprasad 2006). According to Hytter (2007), personal commitment also plays important role in employee decision to stay or to leave the organisation. Hence, this study intends to explore the role of both personal and organisational factors in employee decision to leave the organisations. Hytter (2007) further finds that role of leadership is vital in instilling organisational commitment, which has positive relationship with employee retention in the organisation. Walker (2001) finds that leadership role is vital in employee retention by focusing on appreciation of performed tasks and compensation, offering challenging tasks, equal and transparent opportunities for promotion, encouraging relations within the organisation, efforts to offer work life balance, putting in place effective communication system, enhancing job autonomy, and encouraging employee participation.
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