The role of leadership development programs in improving employee retention

Abstract

Recent talent management challenges in the growing Asian economy have led many businesses to recognize the need to develop and retain their Asian leaders. Organizations in Singapore not only experience high employee turnover but also lose their employees after investing in training for them. The need for a leadership pipeline, the high costs involved in the investment of a leadership development program (LDP) and high employee turnover, as well as the researcher’s observation of employees feeling obligated to stay with their employer after attending an LDP, triggered an interest in exploring how the psychological contract concept can be applied to improve employee retention. Studies of the psychological contract concept show that there is the potential to apply the construct to retaining employees through contract fulfillment and the obligation they feel to stay with their employer, in exchange for the organizational inducement of attending an LDP. However, the existing literature contains neither psychological contract studies in the Singaporean context nor studies pertaining specifically to LDPs. This research explores how company-sponsored LDPs can increase an employee’s intent to stay with their employers. This is done through the application of the psychological contract concept, by adapting a qualitative and phenomenological methodology to study and evaluate the perceptions that employees had of such programs and the experiences they encountered while attending these programs. Data gathered from a purposeful sample of 30 Singaporean professionals working in private organizations, through semi-structured interviews conducted in person, over the phone and via instant messaging, as well as through open-ended qualitative questionnaires, were analyzed using the Stevick-Colaizzi-Keen analytical method (Creswell,2007,2013) and content analysis. Results showed that participants generally perceived LDPs as an employer obligation within the psychological contract and mostly had positive experiences of the sponsored LDPs they attended. Certain LDP experiences and features had been found to influence some participants to increase their intent to stay with their employers, in one or more ways: by enhancing their affective commitment to their employers; by generating a felt obligation to stay in reciprocation for the development investment; and by elevating their belief that career opportunities laid ahead of them. Perceived organizational support (POS) was found to be important in influencing such intent to stay. The findings of this research support the view that organizations can play a role in influencing employee psychological contracts through their LDP practices, by shaping the messages these programs potentially signal to employees. The results led to the development of a model grounded in the social exchange constructs of POS and the psychological contract, which relates LDPs to employee intent to stay with their employers. New insights into the critical LDP experiences and features that influenced each of the ways that employee retention was enhanced were presented. The findings add to the understanding of employee psychological contracts and POS when related to a specific human resources practice, providing a value to organizational practice around LDPs by identifying the ways organizations can potentially increase their return on investment in LDPs by improving the retention of their talent. As a result of these investigations, suggestions are identified for future research.

Date of Award	2016
Original language	English
Supervisor	Deborah Blackman (Supervisor) & Sharon Eng (Supervisor)