Academy of Strategic Management Journal (Print ISSN: 1544-1458; Online ISSN: 1939-6104)

Research Article: 2018 Vol: 17 Issue: 1

Relationship between Leader Behavior and Subordinate Intention to Remain: Mediating Role of Critical Thinking and Empowerment

Rama Krishna Yelamanchili, Ethiopian Civil Service University

Keywords

Leadership, Sales Teams, Sales Training, Voluntary Attrition, SEM, Employee Retention.

Introduction

Around sixty years back Christian (1960) pointed out that no industrial firm has its marketing work force problem really solved. With constantly growing economy the marketing work force problem persists. Even today, organizations face major difficulties in recruiting and retaining salespeople. On the other hand, the highly competitive market and tough margins are forcing employers to become more demanding of salespeople skillsets. At the same time salespeople turnover brings higher costs in terms of lost sales and abandoned sales territories in addition to the costs associated with recruitment, training and managing new salespeople (Darmon, 2008). Furthermore, when a salesperson leaves an organization he carries valuable market information and customers along with him. In view of this, studying salespersons’ retention remains an important research priority (Jones et al., 1996).

The basic question, then, centres on identifying the predictors those can influence employee intention to remain with current organization. An examination of existing research results into two important factors-leadership and employee empowerment that foster high intention to remain. In addition, in modern sales context, it is posited that critical thinking skills of salespeople will have significant relationship with intention to remain. Earlier research has demonstrated that leader behaviour had positive influence on employee intention to remain (Albrecht & Andreetta, 2011; Chen et al., 2011). Despite recognition that appropriate leader behaviour can enhance employee intention to remain, there is limited research evaluating mechanism by which leadership behaviour influences employee intention to remain. In understanding the mechanism by which leaders influence subordinates intention to remain, two concepts attracted much interest of researchers. They are critical thinking skills and empowerment. There exists handful research on empowerment relating to employee intention to remain (Klerk & Marius, 2014), but very dismal research on association between critical thinking skills and intention to remain. Recent research advised that salespeople should be trained on critical thinking skills for their better performance (Cecilia et al., 2015). Hopkins, Raymond & Carlson (2011) suggested that improved skillset is required by the changing role of salesperson in this milieu. Cecilia et al. (2015) opines that today’s business environment is labelled by globalization, competition, technology and changing demographics and suggested that salespeople today need critical thinking skills to effectively perform in more challenging and multifaceted roles.

Employee retention is one of the important enduring managerial issues faced by employers. This issue is more relevant in highly demanding sales job. Past research demonstrated impact of employee attrition or intention to leave behaviour on organizational performance. In response to this, many organizations are implementing different strategies to enhance employee intention to remain. However, the dynamics of salespeople management and motivation is different. Salespeople work in a highly competitive and challenging job environment. In addition, customers are informative and demanding. In this context, this research tries to examine whether there is any relationship between leader behaviour and employee intention to remain. The research questions that are to be discussed in this paper are: 1) Is there a positive relationship between leadership and intention to remain, 2) what are the mechanisms that leaders adapt to foster intention to remain and 3) which mechanism yields better result.

Present study investigates influence of leadership and two mechanisms (critical thinking and empowerment) on intention to remain, more specifically, how far leader behaviour, encouragement to subordinates to think critically and empowering behaviour will influence salespersons intention to remain. This paper advances the existing literature by linking leadership, critical thinking and empowerment as predictors for salespeople intention to remain. The following section discusses relevant literature. Then, methodology, data analysis, results and discussion are presented. Finally, recommendations are drawn.

Literature Review

Leadership

The topic of leadership is extensively used in academic research. Academicians are interested in knowing who leaders are, what they do, how they do and how they exert power on followers to reach organizational goals. Earlier research related leadership with different outcome variables like, job satisfaction (Dutta & Sahney, 2016; Musinguzi et al., 2017) employee performance (Huang et al., 2016) commitment (Moldogaziev, 2014) empowerment (Newman et al., 2017) intention to stay (Chami & Thomas, 2013; Furtado et al., 2011; Mike, 2015).

Importantly leadership had shown significant positive effect on employee intention to remain. Authentic leadership was negatively related to employee turnover intention (Gatling et al., 2016). Similarly, authentic leadership had significant negative influence on employee intention to quit (Munyaka et al., 2017). On the other hand, transformational leadership behaviours significantly influenced subordinates intention to stay (Chami & Thomas, 2013; Furtado et al., 2011; Mike, 2015). In another context servant leadership effected turnover intention through a mediated effect of organizational commitment (Jaramillo et al., 2009). Kashyap & Santosh (2014) reported that servant leadership influenced positive relationship with perceived employee retention intentions. Support leadership dimension of path-goal leadership style was most highly correlated with reduced group members’ turnover intention (Dixon & Laura, 2010). Employee perceptions of retention were impacted by leader behaviour (Murrell-Jones, 2012). Mekraz & Raghava (2016) reported negative correlation between leadership and employee turnover rate. The leader’s behaviour with subordinates and the resulting dissatisfaction was one of the major reasons employees leaving their job (Jones et al., 1996; Mulki & Fernando, 2011). On the same line, DeConinck & Dean (2004) reported that subordinates satisfaction with the leader was a strong predictor of employee turnover intentions. As against to positive association between leadership and intention to remain no association was found between leadership style and retention (Carol, 2004).

Intention to Remain

Physical and mental burnout components were significant in explaining worker’s intention to leave (Weisberg, 1994). Weisberg suggested that by implementing appropriate strategies managers can reduce employee turnover. Barnes et al. (1998) recommended that management should provide supportive environment to reduce employee turnover. Loyalty to supervisor was positively associated with intention to stay (Chen, 2001). Quality of supervision was significantly correlated with intention to leave (Wilson, 2015). Recent studies indicated that leader behaviours lead to low turnover intentions (Albrecht & Andreetta, 2011; Chen et al., 2011).

Critical Thinking

Watson & Glaser (1964 & 1994) were pioneers in the conceptualization and measurement of critical thinking. They conceptualized critical thinking as a composite of attitudes, knowledge and skills. Sternberg (1986) defined critical thinking as “the mental processes, strategies and representations people use to solve problems, make decision and learn new concepts.” Novelli & Sylvester (1993) believed that critical thinking was directly associated with the ability to generate and operate from multiple perspectives that inform a multilogical view.

Lassk et al. (2012) suggested that sales education should strive to develop critical thinking skills of salespeople. According to Cecilia et al. (2015), salespeople should be trained on critical thinking skills for their better performance. Present day, many organizations are encouraging their salespeople to think critically and asking sales managers to train salespeople in critical thinking skills. It is strongly advocated that to enhance the critical thinking skills of salespeople, managers need to coach, mentor and support salespeople. Furthermore, when salespersons are supported to think in innovate and unconventional way and design novel strategies to meet customer expectations will make salespersons work interesting and exciting and lead to higher intentions to remain.

Empowerment

The concept of empowerment promotes the idea that leaders share power and decision-making processes with followers to improve performance (Wagner, 1994). Deci et al. (1989) argued that leader should play critical role in providing subordinates with empowering experiences because the characteristics of work shaped by the leader contribute directly to followers’ intrinsic task motivation. Earlier research reported significant positive impact of empowerment on job satisfaction, work productivity, task performance (Menon, 2001; Spreitzer, 1995; Thomas & Velthouse, 1990), employee motivation and creativity (George & Zhou, 2007; Zhang & Kathryn, 2010). Significant positive effect was reported between empowerment and customer oriented selling (Martin & Bush, 2006). In another study empowerment was negatively correlated with turnover intention (Klerk & Marius, 2014).

Theoretical Framework And Hypotheses

From the discussion made in introduction and literature review sections, it is clearly evident that employee retention is a major concern of organizations. The existing literature suggested a positive relationship between leadership and intention to remain and a positive relationship between empowerment and employee intention to remain. In contrast, there are certain studies that failed to report significant association between leadership and intention to remain and empowerment and intention to remain. In addition, there is limited research in understanding the mechanism of how leadership influences intention to remain. It is observed that empowerment as one of the predictors of employee retention. Similarly, prevailing research posit that critical thinking skills of employees may have significant positive effect on intention to remain. Today’s highly competitive business environment is demanding highest performance and loyalty from employees. Especially in the sales context, salespeople loyalty and commitment is much expected. In this scenario the present study posit that those leaders who continually encourage salespeople to think critically and come up with innovative solutions to attract, convince and gain customers, leads to salespeople intention to remain. Furthermore, it is hypothesized that leaders empowering behaviour promotes employee accountability, responsibility and a sense of belongingness which in turn leads to high intention to remain. In developing a model linking leadership and employee intention to remain, this study further drew on the empowerment literature and the critical thinking literature to posit two mediating mechanisms with high potential to help explain linkages between leadership and intention to remain.

Models

The conceptual models tested in this study are presented in Figures 1 and 2. The proposed models indicate that leaders’ behaviour may have its impact on intention to remain both directly and indirectly through two mediators (critical thinking and empowerment).

strategic-management-Intention-Remain

Figure 1.Mediating Role Of Critical Thinking Between Leader Behaviour And Intention To Remain (Model 1).

strategic-management-Leader-Behaviour

Figure 2.Mediating Role Of Empowerment Between Leader Behaviour And Intention To Remain (Model 2).

Hypotheses

Based on the above discussion, as well as empirical evidence provided by previous
studies, this study developed the following hypotheses.

Direct Effects

H1: Leader behaviour is positively related to salespeople intention to remain.

H2: Leader behaviour is positively related to critical thinking.

H3: Critical thinking is positively related to intention to remain.

H4: Leader behaviour is positively related to empowerment.

H5: Empowerment is positively related to intention to remain.

Mediation Effect (Indirect Effect of Leadership)

H6: Critical thinking mediates positive relationship between leader behaviour and intention to remain.

H7: Empowerment mediates the positive relationship between leader behaviour and intention to
remain.

Methodology

Context

The passenger car market is highly competitive and cluttered. In passenger car selling environment competition is twofold. One is among manufacturers and the other among dealers of same manufacturer. On the other hand, customers are flooded with abundant of information. They source information from company website and from third party websites. Before their visit to dealer, customers search and read specifications of their choice segment car, compare it with same segment car of other manufacturers and then finalize their preferred manufacturer. Then they call different dealers of same manufacturer to know the price, discount, service quality, speed of service, financing options, etc. As customers are informative and selective, salespersons need to be more knowledgeable, proactive and innovative and adopt newer techniques to convince customer and close the deal. Keeping this in mind, dealers provide continuous training to their salespersons’ on critical thinking and innovative selling techniques. In addition, they empower salespersons’ and encourage them to think critically and come up with innovative selling strategies.

Measurements

For this study, a construct was developed that contains four sub scales. The four sub scales were leader behaviour, critical thinking, empowerment and intention to remain. Each sub scale has five statements those measured on five point Likert scale. Followers rated their leader behaviour, leader’s encouragement to think critically and empowerment that leader gives. In addition, followers expressed their intention to remain in the same organization. These subscales were developed in accordance with the guidelines suggested by Carmines & McIver (1981).

Leader Behaviour

To measure leader behaviour a five-item sub scale was developed. Items were anchored using five point Likert scale (1=Strongly Disagree, 2=Disagree, 3=Can’t Decide, 4=Agree, 5=Strongly Agree). A sample question included the statement ‘My manager clearly speaks goals and uses those goals to measure my progress’.

Critical Thinking

Critical thinking was measured on sub scale that contained five-items. All the five items use Likert five point scale (1=Strongly Disagree to 5=Strongly Agree). A sample statement included ‘My manager uses experiential learning methods to enhance my selling skills’.

Empowerment

Empowerment was assessed using a sub scale that required salespersons’ to rate their manager’s empowering behaviour on a five-point scale ranging from 1 (Strongly Disagree) to 5 (Strongly Agree). The sample item in the scale included ‘My manager gives me authority to make decisions on the spot.’

Intention to Remain

Intention to remain sub scale measured respondents’ intention to remain in the organization. All participants were instructed to reflect their perceptions towards intention to remain in the organization. Sample statement in the scale included ‘I see a bright future for myself within this organization’.

Data Collection

Data were collected from salespeople working for dealers of passenger car manufacturers. Field survey method was used to gather data. Geographic location of the city was divided into five zones. In each zone, 140 questionnaires were administered among salespeople totalling to a sample size of 700. Of the 700 questionnaires administered, 593 questionnaires were received back. In the received questionnaires, 28 questionnaires had more than 60% of missing data and 23 respondents did not answer demographic questions. These 51 questionnaires were removed from final analysis resulted to 542 usable responses (77% response rate).

Participants

All the participants in this study were men with an average age of 28 years. Eighty one percent of respondents were below age of 35 years. Of the total participants, 54 percent hold bachelor’s degree and another 39 percent hold master’s degree. Forty seven percent of respondents were having work experience less than three years and another 29 percent were having work experience of less than five years.

Data Analysis

Reliability Statistics

Scale reliability was calculated using Cronbach’s Alpha. In support of reliability test, F-test was run to examine the hypothesis of internal consistency among scale items. The reliability scores for the four scales (N=542) were, leader behaviour (M=3.92, SD=0.85, α=0.87, IIC=0.58, F(541,4)=3.29, ρ<0.05); critical thinking (M=3.74, SD=0.95, α=0.86, IIC=0.55, F(541,4)=14.10, ρ<0.05); empowerment (M=3.78, SD=0.94, α=0.88, IIC=0.60, F(541,4)=17.79, ρ<0.05) and intention to remain (M=3.59, SD=1.1, α=0.91, IIC=0.67, F(541,4)=2.67, ρ<0.05). All the four scales had satisfactory alpha values (>0.80) and internal consistency of the scale items were significant (ρ<0.05) (Table 1).

Table 1: Reliability Test Result (Cronbach’s Alpha Value And Anova Values)
Scale No. of Items N Cronbach’s Alpha Items Mean Mean Correl df f Sig
Leader Behaviour 5 542 0.873 3.92 0.580 (541,4) 3.29 0.010
Critical Thinking 5 542 0.860 3.74 0.550 (541,4) 14.10 0.000
Empowerment 5 542 0.880 3.78 0.600 (541,4) 17.79 0.000
Intention to Remain 5 542 0.909 3.59 0.670 (541,4) 2.67 0.031

Factor Analysis

Factor analysis was run with correlation matrix, Principal Component Analysis (PCA) and Varimax rotation. The objective was to extract factors with eigenvalues greater than 1. It was observed that factor loadings ranged between 0.59 and 0.87 with no cross loadings. PCA resulted into four factors with eigenvalues greater than 1. The rotated sums of squared loading explained 69% variance. First factor with an eigenvalue of 3.75 explained 18.74% of variance and fourth factor with an eigenvalue of 3.24 explained 16.21% of total variance. Next, to measure the strength of relationship among factors and to examine sampling adequacy, Kaiser-Meyer-Olkin measure of sampling adequacy (KMO) and Bartlett’s test were calculated. The KMO value was 0.92 and Bartlett’s test of Sphericity Approximation Chi-Square value was 6202.42 (ρ<0.05). Table 2 presents result of PCA.

Table 2: Factor Analysis Result
KMO and Bartlett’s Test
Kaiser-Meyer-Olkin Measure of Sampling Adequacy 0.923
Bartlett’s Test of Sphericity Approx. Chi-Square 6202.421
Sig. 0.000
Rotated Component Matrixa
Component
1 2 3 4
R3 0.876 0.009 0.025 0.060
R2 0.865 0.028 0.130 -0.004
R4 0.859 0.085 -0.012 0.046
R5 0.849 0.070 0.048 0.058
R1 0.839 0.086 0.064 0.056
L2 0.059 0.787 0.149 0.112
L1 0.041 0.753 0.191 0.262
L3 0.108 0.752 0.262 0.194
L4 0.051 0.737 0.265 0.249
L5 0.066 0.733 0.251 0.195
E3 0.108 0.112 0.803 0.274
E5 0.096 0.281 0.761 0.261
E2 0.064 0.284 0.746 0.232
E1 0.012 0.311 0.724 0.187
E4 0.023 0.379 0.599 0.307
CT2 0.029 0.201 0.296 0.777
CT1 0.081 0.236 0.049 0.768
CT4 0.089 0.231 0.249 0.719
CT3 -0.020 0.245 0.288 0.700
CT5 0.065 0.106 0.377 0.696
Extraction Method: Principal Component Analysis.
Rotation Method: Varimax with Kaiser Normalization.
Matrixa: Rotation converged in 5 iterations.
Total Variance Explained
Component Rotation Sums of Squared Loadings
Total % of Variance Cumulative %
1 3.749 18.745 18.745
2 3.485 17.425 36.170
3 3.323 16.617 52.787
4 3.241 16.206 68.993
Extraction Method: Principal Component Analysis.

Confirmatory Factor Analysis

Confirmatory Factor Analysis (CFA) was performed using normally suggested model-fit indices suggested by Lorenzo-Seva & Ferrando (2013). Factor software was used to examine the four-factor structure. The following fit indices were computed: Goodness-of-Fit Index (Joreskog & Sorbom, 1996), Comparative Fit Index (Bentler, 1990), Bayesian Information Criterion (BIC), Non-Normed Fit Index (NNFI) and Root Mean Square Error of Approximation (Bentler, 1990). The result indicated that fitness of the four-factor model was satisfactory (χ2=14,490; df =190; GFI=0.99; AGFI=0.99; CFI=0.99; BIC=901.179, NNFI=0.98; RMSEA=0.05). All fit indices values were in accordance to specified standards and confirmed four-factor model.

Results

The present study examined relationship between leader behaviour and intention to remain (hypothesis 1), leader behaviour and critical thinking (hypothesis 2), critical thinking and intention to remain (hypothesis 3), leader behaviour and empowerment (hypothesis 4), empowerment and intention to remain (hypothesis 5). Then, mediating role of critical thinking between leader behaviour and intention to remain (hypothesis 6) and mediating role of empowerment between leader behaviour and intention to remain (hypothesis 7) were assessed. Hypotheses testing were done using regression and mediating effect was calculated using meditational analysis suggested by Barron & Kenny (1986) using Preacher & Hayes (2008) process script for SPSS.

Regression Analysis

Hypothesis 1 of this study predicted that the leader behaviour would be positively related to intention to remain, this hypothesis was confirmed (β=0.18, t=3.54, ρ<0.05). Leader behaviour explained only 2.3% of the variance (R2=0.023). Hypothesis 2 predicted that the leader behaviour would be positively related to critical thinking was as expected. Leader behaviour explained 26.4% of variance of critical thinking (R2=0.264, β=0.57, t=13.91, ρ<0.05). Hypothesis 3 stated that critical thinking is positively related to intention to remain, was received support (β=0.15, t=3.51, ρ<0.05). Hypothesis 4, which stated that leader behaviour is positively related to empowerment, was also supported. The result indicated that leader behaviour had significant positive effect and explained 56.5% of variance (R2=0.565, β=0.63, t=15.91, ρ<0.05). Finally, a positive direct relationship existed between empowerment and intention to remain and empowerment was able to explain 16.7% of variance of intention to remain. (R2=0.167, β=0.17, t=3.94, ρ<0.05) (Hypothesis 5) (Tables 3a, 3b, 4a and 4b).

Table 3a: Hypothesis Test Result-Mediation Analysis Of Critical Thinking Between Leader Behaviour And Intention To Remain
IV DV N R R2 F df Sig
Leader Behaviour Intention to Remain 542 0.151 0.023 12.548 (1,540) 0.000
Leader Behaviour Critical Thinking 542 0.513 0.264 193.373 (1,540) 0.000
Critical Thinking Intention to Remain 542 0.149 0.022 12.304 (1,540) 0.000
Leader Behaviour Intention to Remain 542 0.172 0.030 8.256 (2,539) 0.000
Critical Thinking              
Table 3b: Hypothesis Test Result-Mediation Analysis Of Critical Thinking Between Leader Behaviour And Intention To Remain
IV DV Path Beta Std. Error t sig. LLCI ULCI
Leader Behaviour Intention to Remain C 0.187 0.053 3.542 0.000
Leader Behaviour Critical Thinking A 0.572 0.041 13.906 0.000
Critical Thinking Intention to Remain B 0.166 0.047 3.508 0.000
Leader Behaviour Intention to Remain C’ 0.125 0.061 2.034 0.042 0.004 0.245
Critical Thinking     0.109 0.055 1.974 0.049 0.001 0.217
Table 4a: Hypothesis Testing-Mediation Analysis Of Empowerment Between Leader Behaviour And Intention To Remain
IV DV N R R2 F df Sig
Leader Behaviour Intention to Remain 542 0.151 0.023 12.548 (1, 540) 0.000
Leader Behaviour Empowerment 542 0.565 0.319 253.225 (1, 540) 0.000
Empowerment Intention to Remain 542 0.167 0.028 15.502 (1, 540) 0.000
Leader Behaviour Intention to Remain 542 0.180 0.033 9.071 (2, 539) 0.000
Empowerment              
Table 4b: Hypothesis Testing-Mediation Analysis Of Empowerment Between Leader Behaviour And Intention To Remain
IV DV Beta Std. Error t sig. LLCI ULCI
Leader Behaviour Intention to Remain C 0.187 0.053 3.542 0.000
Leader Behaviour Empowerment A 0.628 0.039 15.913 0.000
Empowerment Intention to Remain B 0.186 0.047 3.937 0.000
Leader Behaviour Intention to Remain C’ 0.102 0.064 1.611 0.108 -0.022 0.227
Empowerment     0.134 0.057 2.343 0.019 0.022 0.247

Mediation Analysis (Indirect Effect of Leadership)

Model 1 Analysis: Leader Behaviour-Critical Thinking-Intention to Remain

First, a regression was run to predict intention to remain (Y) from leader behaviour (X). The unstandardized regression coefficient for prediction of intention to remain from leader behaviour was β=0.19, (t(540)=3.54, ρ<0.05). Thus, the overall effect of leader behaviour on intention to remain was statistically significant. Next, a regression was performed to predict mediating variable (critical thinking) from predictor variable (leader behaviour). The unstandardized coefficient was β=0.57, (t(540)=13.91, ρ<0.05). Next, a regression was performed to predict criterion variable (intention to remain) from mediating variable (critical thinking). The unstandardized coefficient for prediction of intention to remain from critical thinking was β=0.17, (t(540)=3.51, ρ<0.05). Finally, a regression was performed to predict intention to remain from both leader behaviour and critical thinking. This regression provides estimates of the unstandardized coefficients for independent variable and mediating variable. The mediating variable was β=0.11, (t(539)=1.97, ρ<0.05); and direct path was β=0.13, (t(539)=2.03, ρ<0.05).

That all conditions held in predicted direction, coupled with findings that the effect of leader behaviour was less in final equation than in first equation, establishes partial mediation. Sobel (1982) significance test for indirect effect of independent variable on dependent variable through the mediator was also significant at ρ<0.05. For Model 1, the r2=0.03 and this was statistically significant, F(539, 2)=8.26, ρ<0.05.

To measure the direct and indirect effects of the paths, bootstrapping for indirect effects with 5000 samples was calculated. Bias corrected confidence interval with 95% confidence intervals was obtained. The result indicated indirect coefficient was significant, β=0.13, SE=06, 95% LLCI=0.004 and ULCI=0.245. Result confirms partial mediation effect of critical thinking between leader behaviour and intention to remain. Partial mediation effect of critical thinking between leader behaviour and intention to remain indicated that there was a clear implication that other indirect effects could be examined and tested empirically.

Model 2 Analysis: Leader Behaviour-Empowerment-Intention to Remain

First, a regression was run to predict intention to remain (Y) from leader behaviour (X). The unstandardized regression coefficient for the prediction of intention to remain from leader behaviour was β=0.19, (t(540)=3.54, ρ<0.05). Thus, the overall effect of leader behaviour on intention to remain was statistically significant. Next, a regression was performed to predict the mediating variable (empowerment) from the predictor variable (leader behaviour). The unstandardized coefficient was β=0.63, (t(540)=15.91, ρ<0.05). Next, a regression was performed to predict the criterion variable (intention to remain) from mediating variable (empowerment). The unstandardized coefficient for the prediction of intention to remain from empowerment was β=0.19, (t(540)=3.94, ρ<0.05). Finally, a regression was performed to predict intention to remain from both leader behaviour and empowerment. This regression provided estimates of the unstandardized coefficients for independent variable and mediating variable. The mediating variable was β=0.13, (t(539)=2.34, ρ<0.05); and direct path was β=0.10, (t(539)=1.61, ρ=0.11). For model 2, the r2=0.033 and this was statistically significant, (F(539, 2)=8.26, ρ<0.05).

The result of mediation analysis in model 2 found that the effect of leader behaviour on intention to remain was not significant when empowerment was entered and established full mediation. The Sobel (1982) significance test for indirect effect of independent variable on dependent variable through the mediator was significant at 0.05 levels. This provided support for the hypothesis and suggested that empowerment fully mediated the relationship between leader behaviour and intention to remain. Full mediation effect of empowerment suggested that the process by which leader behaviour influences intention to remain was completely explained.

The indirect effect of leader behaviour on intention to remain through critical thinking was (β=0.11, t=1.97, ρ=0.042); the indirect effect of leader behaviour on intention to remain through empowerment was (β=0.10, t=2.34, ρ=0.11). The result supported Hypothesis 6 and Hypothesis 7 that critical thinking mediated the relationship between leader behaviour and intention to remain; and that empowerment mediated the association between leader behaviour and intention to remain.

Model 1 hypothesized mediation effect of critical thinking, it was found that leader behaviour was significant and there was no zero in confidence interval values (ρ=0.04, LLCI=0.004, ULCI=0.245), this indicated partial mediation effect of critical thinking between leader behaviour and intention to remain. Model 2 predicted mediation effect of empowerment, here leader behaviour was not significant and there was zero in between confidence interval values (ρ=0.11, LLCI=-0.02, ULCI=0.227), this indicated full mediation effect of empowerment between leader behaviour and intention to remain.

Discussion

Brashear, Chris & Charles (2005) opined that employee turnover is one of the most researched topics, especially in sales literature, since salespersons turnover costs is very significant including hiring, training and cost of lost opportunity when the territory is not covered. The present research aimed to suggest some practical resolutions to minimize salespersons turnover. In another aspect, this study extends the research of Shoemaker (1999); Mackenzie et al. (2001) who suggested investigating the effect of leader behaviour on employee turnover especially in the context of sales force. Mackenzie et al. (2001) hypothesized that when sales managers’ extend support to salespeople; salespeople become satisfied with their job, more committed to the organization and as a result, less likely to voluntarily leave the organization. This study also tried to understand the mechanism with which leaders influence subordinates intention to remain. Predominantly this research examines these characteristics.

This study hypothesized that critical thinking skills might foster intention to remain. Result of the study provided convincing evidence that this hypothesize is true. The study found a significant link between employee critical thinking skills and their intention to remain in the present organization. This study also showed that empowerment is positively related to intention to remain. In fact, empowerment explained highest variance in predicting employee intention to remain. Overall, this study displayed that leadership; critical thinking skills and employee empowerment were positively related to intention to remain. These findings help fill an unexplored linkage mechanism between leadership and employee retention.

The findings from this empirical study indicated that it might be possible to enhance employee intention to remain with current organization by coaching and mentoring critical thinking skills and by delegating authority and responsibility. The results suggested that employees who improve their critical thinking skills and perceive empowered will utilize their knowledge and skills at work, get motivated, accept the challenges and show interest in facing the challenges and solve problems with innovate and unconventional approaches. This makes their job more interesting and challenging and makes them to remain with present organization.

The distinct contribution of this study is that it built and tested two conceptual models that uniquely integrated leadership theory with employee intention to remain. Although a number of previous studies have examined relationship between leader behaviour and turnover intentions, the mechanism with which leaders’ foster subordinates’ intention to remain was not investigated extensively. This study addressed the underlying mechanism and empirically found support that critical thinking skills and employee empowerment mediated the positive relationship between leader behaviour and employee intention to remain.

Results indicated that leader behaviour influence subordinates intention to remain through critical thinking and empowerment. Sales managers’ leadership behaviour has strong direct and indirect relationship with critical thinking, empowerment and salespeople intention to remain.

Findings revealed that when sales managers support critical thinking skills of salespeople and empower them with distributed decision-making and delegation of authority, salespeople morale will boost and leads to greater commitment and loyalty. Similarly, when sales managers take time to enhance salespeople selling skills through experiential learning and encourage them to think ahead will help salespeople to come up innovative selling strategies and makes their job more exciting. Furthermore, with enhanced skills and critical thinking abilities, salespeople would be able to improve their performance, reduce stress and fear which result into salespeople less voluntarily intention to leave the organization.

In addition, when sales managers gives flexibility to salespeople to take decision related to discount offers or other promotion schemes when they were with customers, will help them to close the sale instantly and makes them feel sense of achievement. Moreover, when managers hold salespeople accountable for their work, they feel prodigious. These findings confirm that sales managers by empowering and delegating authority to salespeople can augment salespersons’ intention to remain in the organization.

This study contributes to leadership literature by investigating and confirming mediating mechanism of critical thinking and empowerment between leadership and intention to remain. Results confirm mediation effect of both critical thinking and empowerment, however, it is observed that critical thinking had partial mediation effect and empowerment had full mediation effect. Furthermore, findings of the study revealed that empowerment explained more variance of intention to remain than both leader behaviour and critical thinking.

Recommendations

This research found that leader behaviour; critical thinking and empowerment are significant positively related to intention to remain. However, the variance explained by these variables is very small. Future research should examine the effect of external forcing factors like, better opportunities in other organizations, career growth, general employment market condition, work stress and burnout, work life balance. In present study, 76 percent of respondents have experience less than five years. As they are new to career they may not be able to adjust with demanding work environment. Future studies should investigate the effect of these variables on senior salespeople. In addition, future research should focus on understanding the relationship between demographic variables and intention to remain. The present study is conducted in the context of automobile retail sales, to examine the models proposed in this study; future research should include multiple industries. This study used self-reported data from salespeople. Therefore, social desirability bias could may have affected salespeople responses. As all data were collected using single questionnaire, common method variance may bloat strength of associations. All the sales managers and salespeople participated in this study were men. Results of this study may not be pertinent to female salespeople.

References