KORELACIJA STILOVA LIDERSTVA I ZADRŽAVANJA ZAPOSLENIH
CORRELATION OF LEADERSHIP STYLES AND EMPLOYEE RETENTION

Summary/Abstract: Leadership is largely related to motivation and, as such, influences employee turnover and retention. A leader establishes plans, predicts and diagnoses the consequences of future events, and solves complex issues of employee motivation. Employee retention implies various actions and strategies that the company develops to retain employees. Within these strategies, leadership is considered one of the main factors that can promote long-term retention. A 2020 Work Institute survey found that leadership behaviour is one of the leading reasons for employee turnover. The issue of employee retention and loyalty is not only related to the application of adequate motivational techniques, but also to resolving demotivators, such as leadership styles that do not enable the achievement of company goals by activating the intrinsic and extrinsic motivation of employees. This paper analyzes the main characteristics of transformational and transactional leadership. The research in the selected company examines the attitudes of employees and managers regarding the applied leadership style and the main turnover factors. Using Pearson's correlation coefficient, the hypothesis that transformational leadership has a positive correlation with employee retention is tested.

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