Leadership is an essential process that influences leaders and workers in an attempt to improve job satisfaction. The purpose of this study is to explore the role played by effective leadership to enhance employee satisfaction. An exploratory qualitative study will be conducted to collect data to determine the impact of effective leadership on employee job satisfaction. I will seek to know the perceptions and experiences of Hong Kong Management about effective leadership and main challenges to employee job satisfaction. Data collection will be done using questionnaires. Data will be analyzed using descriptive statistics by considering issues such as the economy of the design, and the ability to understand the sampled population. A pilot study will be necessary to assist in the verification of the reliability and validity of the research questions. The analyzed data will be presented with the aid research tools such as graphs for ease of understanding. The findings will aid in changing the attitudes of employers in utilizing outstanding leadership skills and to improve employee turnover, promote employee retention, ensure job satisfaction among workers, and to promote ethical leadership qualities among managers.


Most scholars argue that the success of an organization depends on effective leadership styles and skills. The role of leadership in every field is vitally beneficial for employees’ job satisfaction. As employees are the backbone of every organization, their decision to quit the job may negatively impact the organizational performance. Employees’ turnover remains a crucial factor that results to declining productivity in different ways; more so, in Hong Kong, and other Asian countries (Abbasi & Hollman 2000). Staff turnover is costly to individuals, companies, and to the society (Brakefield 1990). A study conducted in Hong Kong revealed that staff turnover has a strong association with employees’ commitment with the organization they work in and this commitment has a significant relationship with the leadership of the organization. These outcomes have also been support by other researchers such as Arnold & Feldman (1982), Kim et al (1996, pg. 36). Estimates of the full cost of turnover range between 70 to 200% of the departing employee's annual salary (Kaye & Jordan-Evans 2001; Abbasi & Hollman, 2000). It makes sound financial sense, therefore, to execute plans and programs to retain skilled employees (Kaye & Jordan-Evans 2001 pg. 11). Effective leaders rank above both pay and benefits, as reasons that employees stay on a given job (Creswell 2002). Coworkers, pay, benefits, and work environment rank fourth, fifth and sixth. Thus, leaders largely determine the retention of skilled workers, which provides the best return on investment (ROI) (Kaye & Jordan-Evans 2001).

Statement of the problem

In Hong Kong, a shortage of qualified employees has been a concern for several decades especially during the globalization period when competition from multinational companies has given employees more opportunities to quite job for better working conditions offered by multinational companies (Wong 1985; Ko and Chung 1997). Employee turnover is an important factor for consideration among organization leaders. Furthermore, it is viewed as a negative occurrence on organizational bottom-line (Miller 2008).  Previous studies have demonstrated that voluntary employee turnover can cause negative impacts and is very costly to an organization (Clark 2008; Miller 2008; O’Reiley 2008). When productive workers leave, an organization can incur huge losses associated with training and recruitment, reduced production, as well, as disoriented customer relationships. According to Sexton et al., (2004, p. 2) high employee turnover reduces an organizational productivity and drains corporate profits. Because of the expensive consequences traditionally associated with employee turnover, many employers invest large expenditures in employee retention programs in an effort to avoid the employee turnover costs. Although there are multitude of factors that can help organizations retain their employees, the leadership plays a vital role in motivating and retaining employees. The leader-member exchange theory suggests that the relationship between employees and their managers as similar to an exchange relationship in which employees reciprocate fair treatment from their managers by working hard to fulfill their managers’ requests. This theory explains an employee’s feeling of obligation to return a favor for being given an opportunity for employment. Even more, employees reciprocate with feelings of commitment toward their managers and organization (Liden, Wayne, & Sparrowe). These feelings of commitment create a desire to remain with the organization. In this context, this study is an attempt to examine and investigate the relationship between effective leadership and employees’ turnover in Hong Kong.

Research objectives

1. To examine the factors of employees’ turnover and retention in Hong Kong based on effective leadership styles

2. To examine the relationship between job satisfaction and leadership styles

3. To investigate the role of effective leadership styles on employees job satisfaction

4. To recommend HRM strategies for retaining employees through effective leadership styles in Hong Kong


In order to examine the influence of leadership styles on employees’ job satisfaction, the following hypotheses will be tested

H1: There is a significant relationship between effective leadership styles on job satisfaction levels of subordinates

H2: There is a positive relationship between job satisfaction and organizational commitment to effective leadership styles

H3: organizational commitment to effective leadership styles would have a strong effect on employees’ turnover and retention.

Proposed Methodology

This will be an explanatory and descriptive study that will utilize questions focusing on discovering the effect of effective leadership on employees’ job satisfaction. For this purpose, the researcher will adopt the qualitative research method. Researchers typically use either quantitative or qualitative research methods (Neuman 2006, pg. 45). Quantitative research is most appropriate to support hypotheses with statistical analysis when variables are known and the researcher is interested in examining one variable in detail or describing the relationship between variables (Neuman 2006). Quantitative research is not appropriate when a general problem is largely unknown, and variables are not identified. The qualitative approach is useful to explore a central phenomenon associated with a general problem. Qualitative research studies can involve field notes, interviews, photographs, documents, and journals to explore the perceptions of individuals who have experienced a particular phenomenon. The qualitative research method is most appropriate when the variables are unknown and need to be identified (Neuman 2006). The current research study is an exploration of one central phenomenon, the employees’ turnover in Hong Kong and the role of the effective leadership to retain these employees. The qualitative research method is the most appropriate approach for the current research study as an exploration of a phenomenon present in the natural flow of social life (Neuman 2006).

Data collection

Data collection methods typically consist of interviews to explore the perceptions of individuals who have experienced a particular phenomenon. Qualitative researchers perform a detailed analysis of a situation, or phenomenon, as it occurs in a natural context in order to further enhance the understanding of a phenomenon based on external context factors (Neuman 2006). In this study, semi-structured interviews with the management of Hong Kong companies will be conducted in order to ascertain their perceptions and experience of employees’ turnover and the leadership effectiveness for retaining them. Qualitative research facilitates capturing and understanding the perceptions and lived experiences related to a phenomenon in order to better understand underlying theoretical constructs and behavioral meanings (Moustakas 1994).

Population and Sampling

A research population is a set of individuals who share a common characteristic that distinguishes those individuals from other groups. The population for the qualitative research study will be the management of the selected Hong Kong organizations. Purposeful sampling will be used to intentionally select individuals who can provide information for the understanding of a central phenomenon. The homogeneous sampling technique will ensure all research participants have similar defining characteristics.


This dissertation will open up a new vista of academic research and explore the factors that cause employees’ job satisfaction. Further, through this study, the researcher will be able to apply the theories of HRM, leadership and employees management learnt during the course of this study. As this will be a qualitative study in which the researcher will have to interact with the management of some selected organizations, the researcher will be able to understand how semi structured interviews or questionnaires are conducted and how participants’ experiences and knowledge is gained for proving or rejecting a hypothesis. The participants will be representative to the general population.  In order to address this issue, various leadership theories and models have been explored to assist in understanding the modern workplace environment. However, some researchers seem to support the notion that effective leadership styles assist in achieving organizational performance. In most countries, different leadership styles and leadership effectiveness result into different job satisfaction among subordinates (Schriber and Gutek 1987). The subject of leadership types and its effects on job satisfaction has received increasing debates by many researchers over the last decades, hence calling for more attention to investigate the perceptions and experiences of Hong Kong Management concerning effective leadership and effects on employee satisfaction. In an organization, employees are the most important assets. Effective leaders can ensure that employees are motivated in their daily activities and achieve the organizational mission (Vroom 1964). This study will compare effective leadership styles and the employees’ levels of commitment by increasing satisfaction, policies, as well as work conditions. The study will provide recommendations on how effective leaders should take actions to improve work conditions that will be conducive to provide a stimulating and challenging work environments, because effective leadership and job satisfaction are fundamental factors in an organizations achievement (Wang 1986).

The most effective way to evaluate the performance and effectiveness of an organization is job satisfaction among workers (Robbins 2009). In most successful organizations, effective leaders provide direction and lead their subordinates towards achieving organizational goals (Akehurst, et al. 2009). Furthermore, satisfied employees are more likely to exert more effort in their roles or assigned tasks, which enhances organizational interests (Akinboye 2005, pg. 23). A good leadership style inspires employees into higher levels of team work, through an approach of providing direction, implementing plans, and motivating workers (Antonakis, e al. 2003). Differences in leadership styles affect job satisfaction. A study conducted by Maritz (1995) identified different styles of leadership. These styles are becoming a necessity for many organizations. Effective leaders show concern for subordinates; hence, lead a very productive workforce. According to McClelland (1988) an effective must react to work place situations promptly to improve employee motivation, and therefore, contributes to job satisfaction. Good leaders understand the meaning and importance of job satisfaction and are involved in contributions to make conscious interventions to improve job satisfaction. According to Avolio, et al., (1988) leadership styles are constant and each style has its merits and demerits, and relevance to certain situations. Previous studies demonstrate that an effective leader may have knowledge and skills to perform effectively in one situation, but may not perform effectively in another work situation. Therefore, changes in leadership styles and effects on employee job satisfaction cannot be refuted. In most organizations, managers strive to improve employee satisfaction by using appropriate leadership styles to work situations (Bass & Bass 1990). Job satisfaction is the extent to which the employee is committed to the job, and is evident in the attitude that the employee demonstrates, such as, contentment to the task assigned task (Bass 1985). There are various job characteristics that an effective leader significantly influences, in order to achieve work outcomes, such as job satisfaction (Bass 1998).


The results produced will be used to justify or refute the hypothesis on the impact on workers’ job satisfaction under the influence of the behavior of leaders, which is a better indicator in the evaluation of effective leadership, including employees’ satisfaction, and to confirm how effective leadership has a significant relationship to working condition and work assignment, which are (Ristow et al.1999) dimensions in job satisfaction. Leadership effectiveness contains many variables, which are not only determined by the leader alone. The projected limitations revolve around sampling issues, since this study will not focus on specific target group. Moreover, the questionnaires will only be distributed randomly to the participants. As a result, it may affect the study findings. Data will be obtained from participants and will be based on their demographic characteristics.

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