Does Leader-Member Exchange and Organizational Commitment Affects Turnover Intention of Employees? A New Perspective in The Banking Sector

Abstract

The success of an organization largely depends on how well the leadership process is executed. Now a days, relationship-based approaches of leadership are tapping the attentions of scholars. The study mainly focused on the effect of leader-member exchange and organizational commitment on employee turnover intention. Methodologically, the study was explanatory research in design. Besides, cross-sectional survey method was employed in an attempt to gather the relevant data at one point in time. A total of 399 respondents were participated in the survey. However, 371 respondents gave relevant information and their response score included in the final data analysis. Exploratory factor analysis via SPSS 23 and confirmatory factor analysis via AMOS 23 was conducted. Structural equation modeling using AMOS 23 was applied to examine the causal relationship between leader-member exchange, organizational commitment and turnover intention. The overall analysis result shows that, leader-member exchange has a positive and significant effect on employee organizational commitment level. In addition, organizational commitment significantly and negatively affects employee turnover intention. Moreover, organizational commitment fully mediates the causal link between leader-member exchange and turnover intention level of bank employees. The study result gives a clue that the level of relationship leaders and followers are reciprocating with each other significantly affects turnover intention of employees in the banking sector. The study result may broaden the understanding of leadership research in the context of the banking sector. Because of the study's use of a cross-sectional survey methodology, only less can be learned about causality. Future studies must be carried out in a manner that involves data collection using several approaches and longitudinal research designs.