CHAPTER 3 RESEARCH ARTICLE The influence of leaders’ personality types and emotional intelligence on retention factors
Orientation: Retention is becoming increasingly important in today’s world of work, especially in the asset management industry.
Research purpose: The objectives of the study were: (1) to determine whether staff and leaders differ significantly regarding their perceptions of leaders’ emotional intelligence and retention factors; (2) to explore the relationship between leaders’ personality types, emotional intelligence and retention factors; and (3) to assess whether people from different gender, race and age groups and business units differ significantly in terms of the retention factors.
Motivation for study: Retention is critical to maintaining an organisation’s competitive edge and is an indicator of organisational success. Voluntary turnover causes a talent gap in organisations and often results in employees moving to competing firms, thereby sharing their skills and knowledge with competitors.
Research design, approach, or method: A quantitative research approach was used for this study. Descriptive, correlational and inferential statistical analyses were performed. A cross-sectional survey was used on a purposive sample of 160 participants employed within the asset management industry.
Main findings: The ESTJ profile was the dominant MBTI personality type in the study which suggests that the leaders are highly task-focused and favour creating logical order and structure in the organisation. Leaders and staff differed significantly only in terms of their perceptions of the ECP self-motivation variable (current behaviour).
In terms of the importance of behaviour, a gap analysis indicated that emotional literacy and self-management to be of less importance to staff members compared to what leaders thought.
Extraversion-introversion presented a significant correlation with self-rated emotional competence. A positive correlation existed between supervisor support and the thinking-feeling personality type. All the retention factors, except work/life balance, related significantly to the emotional competencies of leaders (as rated by staff). Work/life balance only correlated with the self-motivation behavioural competency. The personality preference of sensing-intuitive related significantly to change resilience.
Extraverted personality preference types appeared to rate themselves higher on their self-esteem competencies. There were significant differences between leaders and staff members in terms of their retention scores on job characteristics and work/life balance. The male participants scored significantly lower than the females on the work/life balance. African and White respondents differed significantly in terms of the retention factors and age groups differed significantly in terms of job characteristics.
Practical implications: Individuals and organisations need to acknowledge individuals’ needs in terms of what will make them leave or stay in an organisation.
Contribution: The findings contributed to the existing retention literature regarding the relationship between leaders’ personality types, emotional intelligence and retention factors.
Keywords: Personality, personality types, personality preferences, emotional intelligence, emotional competence, retention factors, retention practices and leadership.
Key focus of the study
Talent is becoming increasingly important to the success of organisations (Hiltrop, 1999). Fishman (1998) states that the demand for talent will increase and the supply will decline with the consequence being a war for talent. Talent can be described as “the vehicle that moves the organisation to where it wants to be” (Lockwood, 2006, p.2).
It is therefore becoming increasingly important that companies retain skilled and talented employees in order to maintain their competitive advantage (Walker, 2001). Losing such employees will result in financial losses as new employees will have to be hired and trained (Walker, 2001). Another risk is that employees take their skills and know-how with them, which translates into a potential risk of losing confidential information to competitors (Frank et al., 2004; Walker, 2001).
Research has suggested numerous reasons why employees consider leaving their employers, such as inadequate pay and benefits, lack of career opportunities, training and development, poor communication and subordinate-supervisor relationships, a negative perception of leadership and culture, an unsatisfactory work environment, a lack of autonomy and decision-making authority and conflict between family and work responsibilities (Carraher, Parnell, Carraher, Carraher & Sullivan, 2006b; Flinkman, Laine, Leino-Kilpi, Hasselhorn & Salanterä, 2008; Gaiduk, Gaiduk & Fields, 2009; Gberevbie, 2010; Strothmann & Ohler, 2011).
The war for talent in the asset management sector remains a global concern (Anonymous, 2010). Ellis (cited in Anonymous, 2010) states that retention packages are critical for the retention of investment professionals.
Background to the study
Not having the right people in place to lead and confront business challenges can have a significant impact and serious implications for organisations (Beechler & Woodward, 2009). Retaining core employees while keeping staff turnover to a set target is a key strategic issue for organisations (Martins & Coetzee, 2007). Retaining talent is regarded as being important in order to achieve business results (Frank, 2006).
Retention is viewed as critical in maintaining an organisation’s competitive edge and serves as an indicator of success (Bogdanowicz & Bailey, 2002). Voluntary turnover causes a talent gap in organisations and often results in employees moving to competing firms and sharing their skills and knowledge with competitors (Stovel & Bontis, 2002). The question then arises whether leaders’ personality types and emotional intelligence relate to retention factors.
The present study aims to explore the relationship between leaders’ personality types, emotional intelligence, and retention factors. The study intends to make new contributions to organisational retention practices.
Voluntary organisational turnover is often dysfunctional and can be detrimental to the success of organisations (Mobley, 1982). Leaders may have an impact on the effectiveness of groups and also impact group members’ attitudes and feelings (Smith & Canger, 2004). It may be more enjoyable and satisfying to work for an approachable and sympathetic leader than a person who leads by fear and intimidation. There is a link between job satisfaction, attitudes and turnover (Smith & Canger, 2004) and several authors have noted the critical role that leaders play in the retention of key employees (Harris & Brannick, 1999; Kaye & Jordan-Evans, 1999).
Research revealed that emotionally intelligent individuals are experts at putting themselves in positive affective states. Even though emotionally intelligent individuals may experience negative affection states at times, these do not have significant destructive consequences (Babalola, 2007). Emotionally intelligent leaders are likely to see the positive side of things and use their emotions in a positive ways to find solutions (Grandey, 2009). Bar-On and Parker (2000) argue that those with high emotional intelligence will deal with difficult situations in adaptive ways.
Across all jobs and organisations, emotional intelligence matters in staff turnover (Fatt & Howe, 2003). Emotionally intelligent leaders seem to be able to inspire a sense of enthusiasm, trust and co-operation within and amongst employees (Stuart & Pauquet, 2001). Collins (2001) found that managers who had higher emotion management skills had subordinates who showed higher levels of organisational commitment. Most effective managers have the ability to sense how employees feel about a situation and to intervene when employees are dissatisfied or discouraged (Cherniss & Goleman, 2001). Cherniss and Goleman (2001) further state that effective managers are able to manage their own emotions and as a result, employees trust them and feel good about working with them. In short, it can be stated that managers whose employees stay are those that manage with emotional intelligence (Cherniss & Goleman, 2001). Among others, Cherniss and Goleman (2001) argue that emotional intelligence influences an organisation in a number of areas such as recruitment, retention, development of talent, teamwork, employee commitment, morale and health.
Dunn (2001) believes that effective employee retention depends on emotional intelligence. One cannot retain good employees if the general culture in the office exhibits low emotional intelligence. The job content is important but every job has to do with the interpersonal relationships within the organisation, which has an impact on employees’ satisfaction (Dunn, 2001).
Trends from the research literature
The theory of relevance to this study is Myers and Briggs’s (Myers, 1987) personality type theory, which is based on Jung’s (1921, 1959, 1971, 1990) theory of psychological type. Jung (1921) developed a personality theory where he postulate psychological type as a major construct by which personality could be understood. Jung’s (1990) theory of personality types provide a framework for understanding personality differences regarding cognitive and perceptual styles, motives and values.
Psychological type refers to a personality pattern which involves certain psychological processes that determine an individual’s orientation to life (Jung, 1921, 1971, 1990). People differ according to the various combinations of their processes that constitute their types (Jung, 1971). Jung’s (1990) theory suggests two attitudinal orientations namely introversion (I) and extraversion (E), as well as four psychological functions namely sensation (S) or intuition (N) and thinking (T) or feeling (F).
Personality development is viewed as a dynamic process that takes place throughout life and, according to Jung (1969), personality develops through a series of stages. The stages of life can be grouped into four general stages namely childhood, youth, middle life and old age (Jung, 1969).
Each personality may be divided into one of the various personality types according to two constructs, namely attitudes and functions (Jung, 1990). An attitude is a predisposition to act or react in a characteristic direction, whereas a function is how one observes one’s world and assigns meaning to each experience (Jung, 1990).
The two basic attitudes are extraversion and introversion. The two attitudes do not present a dichotomy, as every personality has both introvert and extravert characteristics, with one of the two being dominant and conscious and the other subordinate and unconscious (Jung, 1921, 1971, 1990). The subordinate attitude will compensate for the dominant attitude and vice versa. Jung’s (1990) theory of personality types is concerned with the conscious use of functions, perception and judgement (decision-making). Apart from the dominant attitude, people have specific ways of assigning meaning to experiences. Jung (1990) distinguishes four conscious mental functions, namely two perception functions (sensing and intuition) and judgment functions (thinking and feeling).
When the individual’s dominant attitude and function are combined the basic personality type may be determined (Jung, 1990). Thus, personality types are patterns in the way people prefer to perceive things and make judgements (Jung, 1990).
Myers (1987) argued that a personality theory must portray and explain people as they are. Myers (1980) extended Jung’s (1990) theory of personality types to include a degree of balance between the functions of perception and judgement and the attitudes of extraversion and introversion. The judging-perception dichotomy was added to Jung’s model (Myers et al., 1998). The Myers and Briggs’ (Myers, 1987) theory of personality types differentiates between sixteen personality types. The Myers and Briggs (Myers, 1987) personality type theory is concerned with four bipolar preferences to determine the relative preference of one over the other. The four scales correspond to the four dimensions of personality type theory, shown in Table 3.1.
Emotional intelligence (EI) can be defined as the capacity to recognise a person’s own emotions as well as those of others (Hicks & Dess, 2008). According to Macaleer and Shannon (2002), emotional intelligence is generally accepted to be a combination of emotional and interpersonal competencies that influence behaviour, thinking and interaction with other people. Emotional intelligence reflects how knowledge is applied and reflected throughout life (Macaleer & Shannon, 2002). Wolmarans and Martin’s (2001) model of emotional competence is relevant to the present study.
Emotional intelligence assists individuals in negotiating their way through interpersonal exchanges and regulating their emotional experiences (Coetzee et al., 2006). According to Wolmarans (cited in Coetzee et al., 2006), emotional competence implies a positive inner state of being and an ability to competently, creatively and confidently adapt in an unstructured, unsure and changing socio-cultural environment. Wolmarans and Martins (2001), categorise emotional intelligence into seven clusters of emotional competencies. These clusters are labelled as:
inter-personal relations; and
integration of the head and heart.
These seven dimensions will briefly be discussed below:
Emotional literacy refers to understanding the flow of an individual’s own and others’ emotions – what caused it and how to react to the particular emotion within the specific context (Wolmarans
Martins, 2001). To put it differently, it is an awareness of the ebb and flow of one’s own and other’s emotions with an understanding of what causes the emotions, combined with the skill to interact in an appropriate emotional manner at the right time, with the right person and within the boundaries of the context (Wolmarans & Martins, 2001). Emotional literacy is demonstrated by an ability to acknowledge and apologise for hurt caused and to express sincere regret in order to mend damaged relationships.
Self-esteem or self-regard
Self-esteem refers to “an honest, objective and realistic assessment of, and respect for, one’s own worth as an equal human being” (Palmer, et al., 2006, p.10). It is about accepting one’s own strengths and weaknesses and the ability to laugh at oneself without feeling inferior (Wolmarans & Martins, 2001). Self-esteem includes unconditional, non-defensive acceptance of one’s talents, values, shortcomings and skills. Self-esteem is evident when one has the courage to act in accordance with personal values in the face of opposition (Wolmarans & Martins, 2001).
Self-management is the ability to handle stress and stressful situations without over-reacting, and finding a balance between mind, body and soul in order to handle emotions optimally (Wolmarans & Martins, 2001). This is visible in the ability to remain calm in the face of conflict and provocation, thereby minimising defensiveness and restoring rationality in the aggravated party (Wolmarans & Martins, 2001).
Self-motivation is about setting one’s own challenging goals and extending individual capabilities in an effort to achieve them while staying focused and optimistic, regardless of hardship or setbacks. Self-motivation is also explained as unceasingly striving towards one’s own goals (Wolmarans & Martins, 2001). Self-motivation entails taking responsibility for one’s successes and failures, and to “hang in there” when others have given up (Wolmarans & Martins, 2001).
Change resilience is characterised by being flexible and open to new things and to change when needed. Those with high change resilience are able to cope with and thrive in times of difficulty, and remain excited and driven by future prospects (Wolmarans & Martins, 2001). Change resilience is demonstrated by an ability to cope with ambiguity, to thrive amidst chaos and to be re-energised by beautiful scenes encountered along the way (Wolmarans & Martins, 2001). An advanced level of change resilience is demonstrated by the above-mentioned factors, as well as displaying anticipation of the unknown (Palmer et al., 2006).
Interpersonal relations are characterised by an intuitive understanding of, and a deep level of caring and compassion for, people. This suggests that one needs to have a real concern for the well-being, growth and development of others. It further suggests that one takes pleasure in, and recognise their success. Interpersonal relations involve motivating others by setting high expectations and getting them to commit to a cause. This competency also includes the ability to be a team leader as well as a team contributor in order to achieve set goals. A high level of interpersonal relations is demonstrated through the ability to connect with others on an emotional level and by being able to build trust and loyalty in order to sustain long-term relationships (Wolmarans & Martins, 2001).
Integration of head and heart
The integration of the head and the heart is one’s ability to use both left and right sides of one’s brain in decision-making and problem-solving. Those who are able to integrate feelings and facts create win-win solutions that serve both the goals and relationship concerned (Wolmarans Martins, 2001). This integration is demonstrated by the ability to turn adversity into opportunity and making inventive, intuitive and implementable breakthroughs in a crisis situation (Wolmarans & Martins, 2001).
Emotional intelligence is a critical component of leadership effectiveness as leaders deal with teams (Goleman, Boyatzis & McKee, 2002). Emotionally intelligent leaders with a great deal of personal efficacy are more motivated to face situations with confidence (Sosik & Megerian, 1999). Goleman (1998) and Lewis (2000) found that a lack of emotional control amongst leaders relates to leader ineffectiveness. An increased self-awareness will cause individuals to more diligently monitor their actions as well as the actions of other team members (Erez & Somech, 1996). Abraham (1999) suggests that emotional intelligence is directly related to performance.
The emotional intelligence of an individual dictates interpersonal relationships (Klausner, 1997). Carefully managed emotions can drive loyalty, trust and commitment as well as increased productivity, innovation and accomplishment (Cooper, 1997).
Retention can be described as initiatives taken by employers to keep employees from leaving organisations (Cascio, 2003). This is done through rewards for performing jobs effectively, building harmonious working relations between managers and employees and maintaining a healthy, safe work environment. One of the greatest concerns for any organisation, especially high-growth organisations, is the retention of employees (Peterson, 2005). Döckel (2003) identified six critical factors that must be considered in the retention of employees namely compensation, job characteristics, training and development opportunities, supervisor support, career opportunities and work/life policies. Retention factors are factors that encourage organisational commitment and thus increase the retention of employees (Döckel, 2003).
Maximising motivation, team engagement, attendance and retention of staff are vital in today’s highly competitive environment (Clayton, 2006). The retention of key productive employees is a significant challenge, both locally and internationally, and has major cost implications, both directly and indirectly (Tanton, 2007). Döckel’s (2003) framework of retention factors is of relevance to the present study as it has been researched in the South African context. Each of these factors will briefly be discussed.
Money seems to be the primary incentive used to lure professionals (Döckel, Basson & Coetzee, 2006). Reward systems are also frequently used by employers to retain staff (Farris, 2000). Higginbotham (1997) states that there is a strong correlation between good and fair salaries and the intention to stay in a specific organisation, which indicates that compensation is a competitive measure but not the primary factor in retention. Hoyt and Gerdloff (1999) raise the point that compensation offers an opportunity for autonomy, security, improved self-worth and recognition.
Professionals that view their tasks as challenging with learning and development opportunities are less likely to leave an organisation (Amabile, Conti, Coon, Lazenby & Herron, 1996). Mottaz (1988) states that specific job characteristics like variety and autonomy are determinants of organisational commitment. Hackman and Oldham (1980) define job autonomy as the degree to which a job provides independence, substantial freedom and discretion for one to schedule work and determine the processes to carry it out. Organisational commitment is influenced by the degree of independence and freedom experienced in a job, as well as participation in planning and organising thereof (Bailyn & Lynch, 1983). The degree to which a job requires the use of a number of different skills and talents also impacts on commitment and retention (Hackman & Oldham, 1980).
Training and development opportunities
Training is essential for the survival of scarce skilled workers (Cataldo, Assen & D’Alessandro, 2000). Cataldo et al. (2000) further state that employees stay with companies that promote career opportunities, and where new skills learned through training can be applied. Meyer and Allen (1997) argue that employee training provides an opportunity for advancement, which can be perceived as the organisation valuing the employee which in turn builds stronger affective commitment.
Supervisor support can be defined as supervisory behaviours that sustain employees’ innovation (Döckel, 2003). Feedback from supervisors and co-workers are considered important (Kochanski & Ledford, 2001). Thomas and Velthouse (1990) argue that where employees can test new skills, exercise discretion and receive regular performance feedback, intrinsic motivation will increase. Recognition from a supervisor relates to affective commitment (Paré, Tremblay & Lalonde, 2001).
Career opportunities are closely related to retention (Kochanski & Lendford, 2001). Managerial roles are generally the most attractive roles as they are considered to carry the highest compensation, prestige and influence (Petroni, 2000). Taking a technical career route entails the accumulation of more skills while remaining involved in technical work (Petroni, 2000). Allen and Katz (1992) state that some employees prefer the opportunity to engage in challenging and exciting activities and projects, irrespective of promotional possibilities.
According to Cooper and Burke (2002), work/life policies should include flexible work schedules, family leave policies and childcare assistance. Many employees value work/life initiatives as meaningful and more important that new positions (Dubie, 2000).
Integration: Personality types, emotional intelligence and retention factors
Research indicated that successful leadership consists of leaders who are self-aware and have an understanding of their own and others’ emotions and who use this understanding to effectively inspire, motivate, connect with and challenge others (Gardner, 1999; Goleman et al., 2002; Kouzes & Posner, 1995). In the qualitative study completed by Kouzes and Posner (1995), leaders’ described their proudest moments in terms of feelings, emotions and challenges.
Leadership is, in part, about managing emotions (Antonakis, Ashkanasy & Dasborough, 2009). It has been proven through many studies that emotional intelligence is tied to successful leadership and it follows that the skills of emotionally intelligent people, like conflict management, flexibility, persuasion and social reasoning are becoming increasingly important (Mandell & Pherwani, 2003). According to Antonakis et al. (2009), good leadership depends on intelligence and whether or not leaders have the right personality characteristics. Being sensitive towards others and acting on and managing one’s emotions in an appropriate way depends on IQ. Being overly sensitive to the emotional states of others or not acting appropriately depends on personality (Antonakis et al., 2009). Dulewicz and Higgs (2003) state that emotional intelligence competencies are crucial for directors of organisations in that these competencies play a role in motivation, interpersonal sensitivity, intuitiveness, conscientiousness and integrity. Emotional intelligence competencies are relevant to a director’s role in shaping a company’s vision, mission and values (Dulewicz & Higgs, 2003).
TABLE OF CONTENTS
LIST OF FIGURES
LIST OF TABLES
CHAPTER 1 SCIENTIFIC ORIENTATION OF THE RESEARCH
1.1 BACKGROUND AND MOTIVATION FOR THIS STUDY
1.2 PROBLEM STATEMENT
1.3 AIMS .
1.4 THE PARADIGM PERSPECTIVE OF THE STUDY
1.5 RESEARCH DESIGN
1.6 RESEARCH METHOD
1.7 CHAPTER LAYOUT
1.8 CHAPTER SUMMARY
CHAPTER 2 LITERATURE REVIEW: PERSONALITY TYPE, EMOTIONAL INTELLIGENCE AND RETENTION FACTORS
2.1 PERSONALITY TYPE
2.2 EMOTIONAL INTELLIGENCE
2.3 RETENTION FACTORS
2.5 RESEARCH HYPOTHESES
2.6 CHAPTER SUMMARY
CHAPTER 3 RESEARCH ARTICLE
3.2 RESEARCH DESIGN
CHAPTER 4 CONCLUSION, LIMITATIONS AND RECOMMENDATIONS
4.1 CONCLUSIONS RELATING TO THE DEFINED OBJECTIVES
4.4 INTEGRATION OF THE RESEARCH
4.5 CHAPTER SUMMARY
GET THE COMPLETE PROJECT
THE INFLUENCE OF LEADERS’ PERSONALITY TYPES AND EMOTIONAL INTELLIGENCE ON RETENTION FACTORS