Indian organizations are dealing with significant chaos, churn, and change in the business world. There is competition in every aspect of their business, and one constant they have to manage is their employees. Employee retention and loyalty affect the organization at several levels, and leadership plays a significant role in this.
This blog explores the leadership qualities that drive the growth of leading organizations across the country. With employees more aware of their options, their need to balance work and personal lives, and their need to be understood and nurtured, leadership will play a pivotal role in organizational growth. At Great Place to Work®, we work with companies to help them evaluate their culture, build leadership capability, and reduce employee attrition.
This blog will examine leadership qualities from employees’ perspectives, supported by data from employee surveys.
How Do Leadership Qualities Affect Employee Loyalty and Retention?
The impact of leadership can be summed up by this famous quote: “People leave managers, not companies.” While employees may be drawn to join a company because of the brand, remuneration package, career growth prospects, and learning opportunities, they stay because of the leadership.
What Does Leadership Mean?
Leadership can be defined by the culture, communication, career definition, support systems, listening skills, and managerial input they provide to their team. When an employee joins a company, their main touchpoints are with the HR department, team, and their team leader. While the HR department helps with settling-in matters and the team handles daily tasks, leaders play a crucial role.
Leaders or managers ensure that the employee:
- Knows what is expected of them, both in the short and long term
- Makes them feel valued in terms of their role and how they work with the team
- Feels that they can share new ideas, which, when viable, they can work on
- Ensures that good work is appreciated and recognized within and outside the team
- Connects their work to the company’s purpose and mission
- Supports them when they face difficulties in their professional and personal lives
In Indian organizations, managers and team leaders hold significant influence, power, and responsibility. Any employee, new or old, looks up to their leaders for guidance and support, and when this need is not met, they feel let down, disconnected, or disillusioned.
Which Leadership Qualities Are Crucial to Ensure Growth and Loyalty?
Here’s a look at some key leadership qualities that employees seek to grow with the organization and feel they should be loyal to.
Leadership Quality #1: Caring and Empathy
Studies on this aspect indicate that leaders who show a caring and empathetic side when required are five times more likely to retain employees. Caring in this context does not mean that leaders have to solve all problems. It means having a more present and connected attitude.
Employees appreciate leaders who interact with them regularly and listen to their input. They appreciate leaders who:
- Lead discussions on the work they are doing, understand where they are, enquire about any roadblocks, and provide solutions where possible.
- Understand work pressures, streamline processes, and help the team work cohesively to meet their goals.
- Show empathy when employees face a crisis, whether personal or professional, and offer resources to help resolve it.
- Help employees understand how their work contributions matter and how this will affect their career growth.
When leaders display empathy and care, they earn employees’ trust, which, in turn, supports employee growth and retention.
Leadership Quality #2: Inspiration and Guidance
Studies show that when a leader inspires and guides employees in times of need, employees are 5 times more likely to stay with the same company. This factor ranks equally with leaders being caring and empathetic. Indian employees aspire to be like their managers and team leaders when a leader inspires their team to do their best and guides them through difficult situations.
Employees are more likely to show loyalty when their manager inspires rather than controls. They will look up to leaders who:
- Have understood the nuances of their work, appreciate it, and help them do it better, either through process changes or by adapting technology.
- Showcase growth opportunities by mentoring employees through difficult periods and providing them with resources to grow more.
- Lead the team by setting an example and adapting to systemic and technological advances without hesitation.
Leaders who inspire and guide will likely ensure employees feel valued and continue to stay and grow with the company.
Leadership Quality #3: Acknowledge, Recognize, and Reward
In most companies, the rewards and recognition event occurs annually and is based on a complicated process. However, the daily life of employees is full of challenges and small wins, and a leader who recognizes and acknowledges them is appreciated.
Studies show that employees whose work is acknowledged, recognized, and rewarded are twice as likely to stay with the company. They like leaders who give them credit for the work they do by:
- Taking the time to recognize employees’ work, acknowledge the results in public, and reward them with small gifts, certificates, etc.
- Giving employees credit for their ideas; if possible, involve them in the project in a leadership or consultant role.
- Encouraging team members to appreciate each other, creating an atmosphere of peer-level appreciation and camaraderie.
Leadership Quality #4: Active Listening and Responding
Leadership is often associated with being good orators who communicate their thoughts and share their knowledge with their teams. However, an underrated and often-overlooked leadership trait is being a good, open listener. Leaders who take the time to listen to what employees say and understand what goes unsaid tend to be good at retaining their teams and inspiring them to do their best.
According to a study, employees are twice as likely to stay at companies where their managers and leaders listen to them. They like it when leadership:
- Takes the time to ask them relevant questions, listens to their response with an open mind without bias, and follows up with actions where applicable.
- Understands team dynamics and provides support as needed to foster a better work environment.
- Steps up to solve customer issues when the team lacks the skills or resources to do so.
- Takes a proactive approach to keeping the team updated on potential career opportunities and encourages them to take on new challenges.
- Interacts informally with the team and occasionally engages them in fun activities to help everyone feel included.
These interactions can provide powerful insights into what employees think and feel, and the problems they are dealing with before they become bigger issues.
Leadership Quality #5: Sharing Values, Information, and Plans
When leaders take the time to share and live the company values, the team follows the example and ensures everyone is on the same page. Teams feel included when leaders take the time to keep them updated on the company’s plans and share information that helps them work better.
Here’s how sharing by leadership helps employees feel motivated:
- They understand the tasks that must be prioritized as per the company’s long-term plans and work accordingly.
- Being included in the company’s growth plans is a great way to increase employee growth and loyalty towards their job and the organization.
- Sharing progress on previously shared plans shows employees that their work matters and that they are part of the company’s growth journey.
Leadership that encourages two-way communication and is transparent about the company’s plans (to the extent possible) builds teams of loyal and growth-oriented employees.
Leadership Quality #6: Making Good Hiring Decisions
Employees spend half their waking hours, five days a week, with their team, and their interactions with their colleagues shape their day, mood, and outlook. When leadership ensures the hiring process considers factors beyond skill and experience, it positively impacts growth and loyalty.
The onus is on the leadership team to evaluate candidates for team fit, organizational culture, and values to ensure the team is comfortable working together. This demonstrates that leadership cares about the below-given aspects:
- Team morale and the ability to work together without any problems
- Considers the team dynamics and reduces the need for micromanagement
- Helps the team improve customer experience with ease at all times
Leadership Quality #7: Enabling Career Growth
Career ambitions and aspirations are common factors that motivate employees to remain loyal to the company. Leadership can play a big role in paving the path for employees to grow in their careers. When a leader takes time to explain the goals and signposts employees must meet to grow, provides support through learning and training opportunities, and mentors them to grow further.
People are more likely to stay loyal and want to grow with the organization when leadership offers:
- Two-way communication about the company’s growth plan and how employees can align their career goals with this.
- Encouragement for employees who want to expand beyond their area of expertise and move into other areas by offering resources to learn and grow.
- Empower the human resources department to counsel employees on what to expect when they move up the career ladder and offer resources to help them adapt.
Leadership goes beyond management, control, or dominance. Leadership is about two-way communication, support, and an open approach to managing challenges.
How to Develop Leadership in Today’s Business Environment?
In most Indian organizations, leaders are appointed based on their experience, technical skills, and ability to communicate. This is a good starting point, as it ensures that the leadership team has a holistic view of the company’s inner workings, has earned the respect of employees, and has earned the trust of customers.
However, leadership is a skill that requires unlearning certain behaviors and learning new ones. Here are some aspects that leadership must be trained on.
Open Listening Skills
Excellent listening skills and great communication is the hallmark of a good manager or team leader. In cases when a manager rises from the ranks, there is a chance that they are good at technical skills but may need some training on the softer aspects of leadership.
People Management
In many cases, leadership is seen as authority and guidance rather than managing people alongside deliverables. However, people management is a big part of the leadership team, which includes understanding how people interact with each other, reading silences, anticipating issues before they occur, and motivating people to do their best.
Cultural Mindset
The onus of living the company’s values and culture visibly is on leadership as people under them emulate their actions. Part of leadership training is ensuring they understand which cultural aspects they must work and help them develop the areas in which they are lacking.
Remove Biases
As human beings, leaders are also prone to their prejudices due to their lives and experience. It is crucial for leaders to be aware of their biases and ensure that it does not affect their decision-making adversely. As leaders, it is important for them to be percieved as fair and just to ensure employees respect and obey them.
360-Degree Feedback
Another critical aspect that leaders must be trained on is to ask for feedback from their team members. This can be done anonymously. Leaders must be encouraged to view the feedback analytics and tweak certain aspects of their managerial style based on that. When team members feel heard, they are more likely to be motivated to do their best.
Leadership Qualities Are the Foundation for Growth and Loyalty
Any organization in today’s competitive market can future-proof their growth trajectory and the loyalty of their people by investing in leadership development. The discerning employee of today wants a competitive remuneration package, good working conditions, and leaders that inspire them.
In a world where growth aspirations and mentorship is critical, it is important for organizations to be equip their leadership with the soft skills that will make a difference. When this happens, it will permeate every level of the organization and directly impact all stakeholders. The key to building maximum customer lifetime value is by ensuring growth of the organization and employee loyalty.
At Great Place To Work India, our team works with your leadership team to build leadership capability. Our employee surveys help you understand their pulse. We also provide culture consulting services to help you act on the results. Want to take this forward? Click here to connect with us.
Frequently Asked Questions
Is it possible to train leaders on soft skills required for growth and loyalty?
Yes, it is possible to train leaders on soft skills as long as they have an open mind and are willing to adapt to the changing needs of the workforce. In many cases, the leaders are not aware of the areas in which they need to improve and making them aware of these areas and training them will help.
Why is effective leadership critical for organizational development?
In any organization, all the stakeholders like the employees, vendors, suppliers, contractors, shareholders, and all other parties look up to the leadership when assessing a company. When a company’s leadership consistently presents a charismatic, communicative, and controlled front, it leaves a positive impression on all the stakeholders and wins their confidence.
Do authority and control continue to be valuable leadership qualities?
Yes, authority and control are valuable leadership qualities and become even more effective when the leadership is open to input from others, good at communication, takes responsibility, offers guidance, and lives the company’s values.
How can leaders be trained on the required soft skills to help them succeed?
Leaders can be trained on the required soft skills through interactive workshops, case studies, gamification, self-learning modules, and practical classes. It is important to ensure that leaders are open to the training and understand the importance of these skills for the training to be effective.
