The Influence of Leadership on Employee Retention in Tanzania Commercial Banks

Abstract

Leadership is one of important aspects in any form of activity that involves people. Leadership may make employees either stay or leave the organisation hence it becomes one of factors that influence employee retention. Organisations spend and invest a lot in their employees and this starts from recruitment and selection, training and development, compensation and other Human Resource Management functions. This entails that letting an employee leave your organisation is a costly decision one can ever make. Various studies done in Tanzania have been investigating employee retention by associating it with other factors such as salaries, working hours, training and development, working environment and promotion among others. This study examined the link between leadership and employee retention. The study used Akiba Commercial Bank (Buguruni Branch) and Tanzania Postal Bank (Morogoro Branch) as the study cases and data were collected using questionnaires. Linear regression analysis was employed to examine the relationship between the variables. It was found that there is significant linear relationship between leadership and employee retention in Tanzania commercial banks. The study recommends provision of training to bank managers and supervisors on leadership skills since managing and leading go hand in hand. It further reminds managers and supervisors to seek for feedback from their subordinates on how they perceive leadership styles used in respective banks and make improvements before the employees decide to leave.