This assignment is for Masters of Business Administration degree and it is an attempt to research and evaluate literature review on the critical issues faced by the businesses today and in the future. The selected topic for this literature review is ‘leadership and employee retention in the age of uncertainty’. A large amount of academic research has already been published on leadership and these have given convincing evidence of the leadership impacts on the employee engagement. In such uncertain economic climate, the leaders show the map to retain the employees within the organisation to encourage the growth, maximise the employee engagement and prepare the best for the organisations (McManus 2016).
Employee retention is related to various steps taken by the leaders to satisfy the needs of the employees. In this uncertain age, the leaders take the strong measure to retain the potential employees who have spent a good time in the organisation. Talented employees help the organisation to achieve the objectives and the leaders try to make the employees loyal towards the organisation so that the employees must contribute effectively (Raducan and Raducan 2014). As stated by Bolden and Herman (2016), the employees leave the organisation suddenly because of the nature of immediate supervisors and it is the responsibility of the leaders to ensure the team members must get adequate support. Moreover, Greenberg (2014) mentioned that the contemporary leaders are facing the issue of volatile, uncertain, complex and ambiguous (VUCA) environment and the leaders need to have the different attributes and skills. Therefore, the leaders need to ensure within the workplace that the work pressure does not seem to be a burden for the team members and the leaders can make the work interesting so that the team members always be eager for change. Day et al. (2014) suggested that leadership in the age of uncertainty is about making the work process happen, contingent. Leaders in the workplace create change by playing the pivotal role in the process of change in which the team members are empowered to act.
Leadership and Management in the age of uncertainty
In the business sector; leadership is very critical to gain the success of the business and most of the academic researches stated that there are conceptual differences between the leadership and the management. As stated by Bolden (2016), the primary difference between leadership and management is that leaders do not necessarily hold the position of the management like the managers do. The leaders do not occupy the formal power as the leaders get the temporary power based on their ability. Segal (2016), mentioned that management and leadership both are the integrated whole in order to get the success of the organisation and both are committed to achieving the common goal of the business success. Ghasabeh et al. (2015) concluded that within the organisation’s managers lead and leaders manage the employees. On the other hand, Vann et al. (2014) argued that one person can play both roles as managers and the leaders; however, both have the equal values. Leaders within the organisations are the immediate supervisors of the team members and the team members direct communication with the team leaders. Team leaders play an important part to engage the team members towards the success of the organisation. In recent time, the team leaders motivate the team members to be engaged and the talented employees are valued by the management.
As pointed out by Yahaya and Ebrahim (2016), of late, the leaders within the organisations provide special emphasis on the emotional quotient of the employees and the good leadership is about showing sensitivity, listening to the employees’ issues and the understanding the problems of the employees so that they can accelerate the skills of the employees. In recent time, the management finds easier to connect to the employees; however, the leaders make the employees clear the concept regarding the education, culture, age, language and gender. Vann et al. (2014) argued that knowledge and information are the raw material; the leaders and management play the role to separate the significant employees from the insignificant one. As opined by Greenberg (2014), the management within the organisation does the work in bureaucratic process, whereas the leaders are the facilitators. Of late, business organisations face the issue from the external forces as economic crisis plunges into the recession and the competition is intense for the organisations. The managers of the organisations strive to retain the employees to keep the talent and fulfil the issue of a subsequent talent gap.
Leadership and culture
In order to execute the business strategy; the leaders need to follow the organisational culture. Organisational culture is very significant as it can motivate or demotivate the employees. Leaders within the organisation should understand the organisational culture and they must recognise the responsibility in changing or creating the culture (Renz and Herman 2016). Leadership culture is about the self-reinforcing the belief, patterns and practice of the leaders. The leaders must interact and make the decisions about the leadership culture. Leaders have their own unconscious and conscious beliefs that must drive the decisions and behaviours of the employees. Leadership culture has three basic ways; the first one is about the dependent leadership which operates with the belief that individuals in authority are responsible for the leadership (Segal et al. 2016). Independent leadership cultures sometimes operate with the belief that leadership comes out of the individual expertise. Interdependent leadership culture deals with the belief that leadership can be defined as a collective action for the benefit of the company as a whole. The management of the organisation can decode the leadership culture by assessing the leaders’ shared direction, aligning the work process and maintaining the commitment. Therefore, the leadership culture is the process of creating the direction, alignment and commitment (DAC). As stated by Birkinshaw (2014), the employees decide to share the direction, the employees also coordinate the work and the leaders maintain the commitment to the collective work.
As pointed out by Buchanan and Huczynski (2013), international trade creates the physical distance between the offices and between the executives; however; implementation of the ICT in the international trade removes the physical and communication distance; but not the cultural distance. The authors further stated that increasing globalisation among the nations develops the understanding of the cultural influences on the organisational practices and the leadership. The leaders have been facing the changing complexity in the cultural context. The employees may come from the different ethnic backgrounds and the team members may belong to the different religious background; the role of the team leaders is to make easier to work with the employees. Cross-cultural awareness is very important for the leaders and it helps to make the link between the leadership styles and national cultures (Byrne et al. 2016). On the contrary, Chin (2016) commented that leadership theories of the authors neglected to consider the cultural impact and the diversity. However, the project GLOBE used both qualitative and quantitative survey methodologies and this project has been done based on 60 different countries attempted to explore leadership beliefs and attributes of the different cultures.
Leadership and employee engagement
Leaders’ duty is to engage the employees so that the employees become motivated to do the proper work at right time. The leaders can take the strategy of telling and showing the employees how the employees matter within the organisation. The leaders must be clear about the organisation and values and leaders can talk about the meaning of the work (Day 2014). The leaders can enable the employees to be more effective in the job as the leaders need to listen to the point of view and they can ask for the feedback. According to Giancola (2016), leaders within the organisation can encourage the growth of the employees by providing the challenge and opportunities to test the new skills and the leaders can support the decisions that the employees make. In addition, employee engagement within the organisation can be done through the leaders’ support and willingness to help the team members in a hard situation. The employees can treat the employees with dignity and they can show the respect (Ghoshal 2015). The employees can seek the ways to celebrate the accomplishment and they can look forward to sharing the dream of the future.
McGregor Theory of X and Y talks about two different styles of management- authoritarian and participative. If the team members dislike the work and the team members have just little motivation; it can be assumed that the team leaders have the authoritarian style of leadership. This authoritarian style (theory X) is usually associated with the micromanaging of the people to make sure that the process gets done in proper way. On the other side, as stated by Frank et al. (2018), the members of the organisation take pride in their work and the employees are likely to adopt the participative management style. Managers use this approach to trust the people so that they can take the ownership and do effectively by themselves. As opined by Hartman and McCambridge (2011), in theory, X, the management assumes that employees do not like work and they avoid the responsibility. On the other side, theory Y states that management assumes that employees are happy to work in the initiative and people are self-motivated.
Factors impacting on employee engagement
Employee engagement is utmost priority of an organisation and motivated employees are the productive employees. The employees must be committed to achieving the company’s goal. The leaders must be motivated to deliver great employee morale and it must produce the results of the organisation. Haddon et al. (2014) commented that engagement represents the situation under which the employees can make an emotionally-based choice to be loyal to the company. Employees demonstrate the people’s engagement through the positive expenditure of the discretionary energy and the clear communication and commitment to e organisation’s strategies, vision and goal. As stated by Henker et al. (2015), the organisation must have considered happiness and engagement incentives; the leaders should think about the employees must be fit for the job role. If the employees have the meaningful job role, they can benefit from the clear goal and the higher level of autonomy. Factors of employee engagement are the fast evolution of the new technologies like intranet and social media network (Carasco-Saul et al. 2015).
Employees in the organisation need to be constantly challenged in the job role in order to perform in a perfect way. The management of the organisation needs to make the workplace culture in a way so that the employees provide value to the organisation. If the employees provide value to the job role and the employees have the happiness and feeling of pride working in the organisation; they will not leave the organisation. Soane (2014) proposed that employees can be engaged through career and growth opportunities that are being given by the organisation; this case is true for the top talents. Most of the secondary data sources and ongoing learning suggest that talent mobility is the ultimate goal of the employees and the employees expect career growth and new opportunity. If the employees lose the motivation for working in the organisation; they will transmit the knowledge to the other job opportunity. In addition, the employee can be engaged through the networking opportunities with the colleagues as the employees can gain the knowledge through building a relationship. As highlighted by Leder et al. (2016), building positive relations with the workers can foster the sense of loyalty, belonging and camaraderie and moral support of the fellow workers. In addition, the extrinsic motivation comes from the leaders and management’s strategies about the compensation package and benefits given to the employees in the form of fringe benefits. It is has been studied that 10% salary increase only contributed to1% increase of satisfaction to the employees (Huang and Rundle-Thiele 2014). One of the factors of employee engagement is associated with the fringe benefits as the employees expect to have the extra compensation other than fixed salaries and the employees also expect to have the work-life balance from the job.
Importance of employee engagement in the age of uncertainty
The employees are expected to have the fair wage for both men and women. The leaders within the organisation measure the performance of the employees based on the employee engagement. The leaders within the organisation can measure the engagement with the help of data tracking and consolidating software like ERP (Garban 2016). This system allows the employees to review and monitor their own progress in relation to the professional objectives. According to Gallup; managers can focus on both engagement and the performance to maximise the employees’ satisfaction level and retention. Good and strong managers can maximise the engagement keeping in mind of difference. Self-determination theory represents the broad framework of human motivation and the personality as this theory articulates the meta-theory framing the motivational concept (Legault 2017). Self-determination theory states about intrinsic and extrinsic sources of motivation along with cognitive and social development. Therefore, employee engagement has the behaviour specific implication and the individuals experience competency, autonomy and relatedness. In recent time, it has been observing that employee engagement dropped 2% in the global arena and some of the leading countries showed the conflict or uncertainty in the form of elections, terror attacks and refugee settlement. However, as stated by Hunag et al. (2016), employee engagement in the organisation is very important as can help the employees to cause the marketing and it leads to the better productivity. The leaders in the organisation make the work culture so that the employees must be engaged as the engaged employees are less likely to quit the organisations. According to Mone and London (2018), engaged employees tend to positive and engaged employees are more philanthropy minded.
Conclusions
It has been observed that leadership concept has faced the rapid evaluation and it has been topic of controversy regarding the workplace culture. Research studies provided that ethical leadership and empowered leaders can improve the communication with the subordinates. The subordinates may get the chance to showcase the decision-making skills. It has also been noticed that congruence between the management and organisational leadership can impact on the effective organisational success. (Karanges et al. 2015) observed that management of the organisations sometimes influences by the external forces and the decisions of the leaders get determined by the external choices as well. Employee engagement is about managing the people and companies seen to grasp the concept of having the employees engaged in the work to embrace the responsibility of making 21st-century workplace. Managers can interact the most with the employees and leaders can engage the employees to reach towards organisational objectives. The leaders in the workplace make suitable workplace culture where the employees can work preferably. Leaders themselves have to be engaged before they engage their team members. The gap in literature found in the high ratio of engaged to non-engaged employees who have better employee retention and reduced absenteeism. Future leadership is immersed to have the positive energy in each of the employees and it stimulates the best in every individual to develop potential energy.
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