Why People Stay: How Leadership Competence, Trust, and Organisational Culture May Influence Employee Retention

Abstract

Employee retention is defined as pay, workload, career opportunities and employment conditions. These factors matter, but do not explain why employees choose to stay in some organisations and leave others. Leadership may propose part of the answer because employees experience their organisation through routine communications with leaders. These interactions form perceptions of fairness, competence, development, accountability and trust.

This paper develops a qualitative framework to explore how leadership competence may underwrite to employee retention through organisational trust in different organisational cultures. It draws on an integrative synthesis of present research more than primary employee data. The analysis submits that leadership competence is better stated as a set of proficiencies than as a single leadership style. Future-oriented leadership can propose direction, whereas aptitude management can boost employee capability. However, these effects are designed by organisational culture.

The reviewed evidence indicates that leadership competencies interact differently with hierarchical, developmental, rational and group-oriented cultural conditions. The paper therefore proposes a qualitatively developed conceptual model in which leadership competence creates the conditions for trust. That trust reinforces willingness to stay, and organisational culture profiles the meaning and strength of these relationships.

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