The Impact of In-Circle Group on Employees Turnover in Saudi Arabia Business - Research Proposal Example

Research proposal On The impact of in-circle group on employees’ turnover in Saudi Arabia Business, using guanxi within LMX approach Table of contents 1. Introduction 4 2. Statement of the problem 5 3. Purpose of the research 6 4. Significance of the research 6 5. Research questions 7 6. Research hypothesis 8 7. Aims and objectives 9 8. Literature review 9 9. Research plan 11 9.1 Research framework 11 9.2 Proposed research methodology 12 9.3 Study region 13 9.4 Data collection and sampling 13 9.5 Data analysis 13 10. Ethical issues 14 11. Implications of the research 14 12. References 15 Abstract In the transforming societal norms, the managerial leadership has emerged as vital issue that significantly influences the employees’ turnover and performance. The research investigates the impact of in-circle group on employees’ turnover using guanxi as independent variable in LMX approach within the industries/ business of the private sector in Saudi Arabia. The Western culture is vastly different to Islamic culture of Saudi Arabia that fosters conflicts across the workforce. Consequently, high turnover has emerged as major issue across the private sector in Saudi Arabia. The private sector therefore needs to evolve effective mechanisms of reducing high turnover of Saudi nationals by exploiting the various perspectives of guanxi, the Chinese relationship-building phenomenon within the LMX approach. 1. Introduction Globalization has significantly changed the dynamics of social structure and provided businesses with socio-cultural diversity that is indeed diverse in its application of ideas, ideologies and competencies across people coming from different race, culture, color and nationality. As such the role of HRM is crucial in creating a diverse workforce whose competencies are judiciously exploited for increasing organizational productivity (Gillham, Wood & Somerville, 2007). In the transforming societal norms, the managerial leadership has emerged as vital issue that significantly influences the employees’ turnover and performance. As such, investigating the role of leadership in predicting employees’ behavior and workplace commitment becomes an important issue for studying its impact on employees’ turnover (Gilly et al., 2009). The research would therefore investigate the impact of in-circle group on employees’ turnover using guanxi as independent variable in LMX approach within the industries/ business of the private sector in Saudi Arabia. In the current environment of highly volatile market conditions and rapid globalization, the organizational change is unavoidable and necessitates changes in the organizational structure, policies and operations (Kotter & Schlesinger, 2008; Hodgson, 2009). The workforce becomes critical ingredient in the organizational change processes as they are the key facilitators for implementing these changes for higher performance outcome (George & Jones, 2005). The on-going relationship between the managerial leadership and the workforce becomes the major stimulant of mutual exchange that encourages workers to adopt changes to meet new challenges (Lee, 2008). Consequently, the role of leadership as a social change process evolves as a vital aspect of organizational change which takes place between the leaders and the followers. Moreover, guanxi is a relationship-building phenomenon in Chinese society that considerably impacts workplace relationships. Guanxi as an independent variable can be exploited within the LMX or the Leaders-Member-Exchange approach. LMX relies on the assumption that relational leadership is an effective mechanism of predicting employees’ behavior and turnover as it promotes a positive social exchange between the leaders and the followers (Graen & Uh-Bien, 1995). Saudi Arabia as a fast developing oil economy of the Middle East is facing challenges of high employees’ turnover due to many reasons which need to be addressed urgently. 2. Statement of the problem Saudi Arabia is a major oil economy of the Middle East with one of the largest oil reserves in the world. In the last few decades, it has seen massive changes in its socio-economic development processes. It is witnessing rapid urbanization and upsurge in expatriate population due to fast growth of multinational organizations (sa, .n.d). The private sector is extensively involved in the economic development with the help of the government through investment in Saudi economy. In order to safeguard the interests of the Saudi nationals, the government policy has introduced quota system that requires private organizations to employ Saudis in place of foreign workers while enforcing restrictions on the foreign employees (Looney, 2004). The Western culture is vastly different to Islamic culture of Saudi Arabia that fosters conflicts across the workforce (Bierke & AlMeer, 1993). Thus, various industries in private sector especially MNCs are challenged by the high turnover of employees that is adversely impacting firms’ performance. 3. Purpose of the research The basic purpose of the research is to exploit the tenets of social relationships within the workplace so that leaders can influence employees’ turnover. The managerial leadership in the private sector of Saudi Arabia is not well versed in the cultural competencies and skills so as to overcome the differences of socio-cultural ideologies and differing value system (Butler, 2009). The in-circle communication between leaders and members of in-group play vital role in creating a facilitating work environment that promotes commitment, job satisfaction and low turnover. At the same time, in-circle communication across groups becomes constructive or destructive according to the level of leadership initiative in building strong workplace relationship based cross cultural understanding and mutual respect (Harris et al., 2009). The application of guanxi within the relational leadership processes helps to inculcate trust across the diverse workplace. It is assumed that guanxi could be successfully used within different dimensions of the LMX approach for improving the performance of the workers. 4. Significance of the research The research would be hugely significant for private sector in Saudi Arabia as it would address the high turnover of employees in the different organizations of the private. The country needs to involve its people in the development processes. It is witnessing fast transformation in almost all areas of public concern vis-à-vis health, education, transport, environment and infrastructure development. The low employment of the locals in the private sector is a major concern of the government. Though the government’s policies have ensured jobs for the Saudi nationals but there is distinct lack of employees’ commitment and low turnover due to lack of requisite skills and qualifications. The research would help the organizations to use the research outcome for motivating the local workforce adopt new mechanisms of improving performance. Gamble and Huang (2008) assert that cultural variance is vital element that has substantial impact on the employee commitment and their turnover. The study highlights the ways of improving the effectiveness of leaders of an organization for enhancing the workplace performance and influencing employees’ turnover. It ensures that people contribute to the development processes of the nation. 5. Research questions 1. What are the effective roles of LMX that affect employee turnover intention of in-circle group? 2. To what extent, the effectiveness of LMX is influenced by the conscious application of ‘guanxi’ between organizational leadership and workforce? 3. How does the affect of in-circle group influence turnover intention in the private sector in Saudi Arabia? 4. To what extent private organization make efforts to exploit the tenets of social relationship within the broader context of LMX theory for employee turnover intention? 5. Which particular LMX dimensions are affected by guanxi which need to be undertaken for improving employees’ turnover intentions? 6. Research hypothesis Workers are the pillars of the organizations who play key role in the change process. Many scholars emphasize the role of individuals rather than management in implementing change (Lamm & Gordon, 2010). The basic premise is that individual member’s behavior is at the ‘core of organizational change’ (Porras & Robertson, 1992, p. 724). Workers are often challenged by the change as it tends to disturb the routine and the comfort zone of workers. Consequently, they resist change that adversely impacts the productive outcome of the organization. In the highly competitive global scenario, change becomes an integral part of development process in order to meet the myriad conditions of increased competition vis-à-vis globalization, advancing technology; government regulations, communication etc. (Heuvel & Schalk, 2009). The change initiatives therefore emerge as a major test for organizational leadership because it not only requires quick responses to change but it must also ensure that changes are understood by the workers so that they are accepted with greater responsibility and implemented with high commitment to the organization. Indeed, it is important that changes are looked upon as new opportunities of growth. The various dimensions of leadership such as affect loyalty, contribution, commitment, etc. emerge as vital exchanges between the leadership behavior and employee outcome during organizational change process (Neves, 2009). Thus, relational leadership approach becomes vital ingredient of change process because it tends to develop individual exchange process between the leader and individual worker to understand change and remove uncertainties regarding change. The LMX approach promotes communication in in-circle group to inculcate trust, confidence and understanding which influences employees’ turnover intention. 7. Aims and objectives 1. Investigate the various dimensions of LMX that are significantly influenced by guanxi. 2. Examine the various variable of in-circle group that are influenced by the LMX. 3. Explore the different paradigms of employees’ turnover intentions that are impacted by the exchanges within in-circle group members and leaders. 4. Studying the critical success factors of employees’ outcome and their turnover intentions within the broader framework of guanxi based LMX approach. 8. Literature review The environmental compulsions become powerful antecedents that necessitate proactive participation of the workforce in the change process (Oakland & Turner, 2007). The various imperatives that impact the effectiveness of organizational leadership focus on developing a facilitating exchange between the leaders and the workforce so as to influence workers’ perspectives and workplace behavior. Various scholars emphasize the importance of Guanxi that significantly influences the didactic relationship between the leader and the worker in an organization (Cheung, Wu, Chan and Wong, 2009). It is important concept that encourages positive leader-follower exchange relationship as it incorporates the different perspectives of the manager and the worker. The concept of guanxi is pertinent as it helps to develop high quality exchange relations between the organizational leadership and the workforce. Thus, guanxi augmented exchanges can be judiciously employed across different aspects of LMX to influence employees’ turnover intentions (Lau, Lam, & Salamon, 2008). Hughes et al., (2010) insist on the quality of LMX and its role as mediator between the leadership behavior and employees’ outcome. Uhl-Bien, Maslyn, and Ospina (2012) also assert that didactic relationship of leaders and employees tends to influence employees’ outcome. Saudi Arabia is categorized by its unique cultural aspects that shape its value system and work ethics (Robertson et al., 2002). Moreover, Islamic work ethics envisage the workplace as a community with a strong sense of a brotherhood (Pellegrini & Scandura, 2006). They prefer informality and the personal approach in their relationships with their employees (Dedfar et al., 2003). This often becomes a causal antecedent for in-group members that promote exchange for loyalty, respect, contribution etc. (Schermerhorn, Hunt, & Osborn, 2011). The guanxi based LMX approach therefore becomes relevant for promoting constructive employees’ turnover and commitment. The effectiveness of leadership in the workplace is based on the various dimensions of social exchange process that are used to develop formal/informal relationship (Chen, Lamb, & Zhong, 2007). The exchange between members of in-group and out-group differ vastly because of the social exchanges that foster varying degree of close association between the leaders and the members of the two groups. Dulebohn et al., (2011) affirm that leadership is central to LMX theory as leaders’ behavior is key facilitator that enhances the quality of exchange. The members of in-circle group are more productive because of the high quality of exchange that leads to greater responsibility, sense of commitment and contribution to the organization (O’Donnell et al., 2012). The causal relationship between the supervisor and subordinate has emerged as important factor within the broader precinct of LMX approach. It exploits guanxi for building strong personal and professional bonds based on mutual trust and respect. Most importantly, few studies have focused on the impact of LMX on the employees’ turnover intentions but they are limited in their perspectives on the role of social relationships within the organizations. The current study would therefore fill the gap in its inclusion of guanxi within the LMX approach while studying the impact of in-circle group exchange on the employees’ turnover intentions. The private sector of Saudi Arabia is distinct in its diverse workforce that needs to address the concerns of the cultural variance and the contextual compulsions of the native population that may be lacking in requisite skills and competencies. The Guanxi focused LMX approach therefore could become critical paradigm for positively impacting the employees’ turnover intention through leadership initiatives that relies on relationship building and creating facilitating environment of growth for the workers. 9. Research plan 9.1 Research framework The research would address different dimensions of LMX theory and evaluate the role of guanxi, in the LMX approach to investigate the impact of in-circle group on employees’ turnover intentions in the industries of private sector in Saudi Arabia. Thus, the research epistemology would be interpretive in nature. It is relevant to my research as the broad spectrum of knowledge gained through this methodology would greatly facilitate in realizing the aims and objectives of the study (Denzin, 1989). Interpretivism is designed to interpret the various elements of relational leadership approach within the in-circle group in terms of employees’ turnover intention. This would facilitate organizations to encourage didactic relationships for improving employees’ turnover leading to organizational productivity. It would also help me to explore and investigate reasons that could be used to improve the framework of organizational leadership exchange process in order to influence employees’ turnover intentions in the private sector of Saudi Arabia. 9.2 Proposed research methodology The research methodology would be mainly quantitative in nature but encompass elements of qualitative approach also for more accurate conclusions. Quantitative research is mainly based on statistical data which serve as important tool for evaluating various imperatives of LMX approach using guanxi as an independent variable. It would help study the affect of in-circle group on employees’ turnover. It would also help to develop linkages with various dimensions of LMX approach within the broader scope of guanxi and influence employee’s behavior and perspectives on the organizational change processes. In the hugely competitive business dynamics of contemporary times, the methodology would help identify variables of social exchanges that can be exploited for influencing employees’ turnover intentions. High turnover of employees has become a major concern within the private sector of Saudi Arabia. The methodology is useful for my research topic as the data can be quantifies which would enable better evaluation and identification of factors that contribute towards effectiveness of organizational leadership. The statistical data is solid evidence and therefore, would lend more credibility to the generalizations (Saunders et al., 2012). The qualitative methodology of the research through interview schedules would give wider perspective to the research paradigms. Qualitative research serves as major tool to evaluate trends and behavioral pattern of the people who can influence a set of defined parameters. In the current study, it would help provide deeper awareness into the role and impact of social exchange processes within LMX and how it impacts employees’ turnover. 9.3 Study region The study would be conducted in Riyadh, Saudi Arabia where industries of private sector would be investigated for research aims and objectives. 9.4 Data collection and sampling Two types of semi-structured questionnaires and interview schedules would be used as sampling tools to collect data from the managers/ leaders and employees of private sector. Sample size would be 300 and the respondents would be selected from six industries in Riyadh. Banks, fast food industry, retail and telecommunication firms would be the main industries of private sector in Saudi Arabia. 9.5 Data analysis Data analysis would use statistical and scientific methods so the results are conclusive. It would facilitate proper evidence in terms of the employees’ turnover and the factors that enhance the effectiveness of leaders to influence employees’ behavior. Efforts would also be made to ensure that the analysis of data gives a clear picture of the wider ramifications of the organizational leadership and the extent of its effectiveness. 10. Ethical issues Ethical considerations are intrinsic part of research and must ensure the trust and confidentiality of the respondents. Saudi Arabia is a culturally sensitive state with patriarchal society. Thus the need to endorse the right to privacy of the participants and encourage confidentiality and trust building is critical to gain information which is accurate. The participants would be informed about the details of the research. A consent form would be used to protect the respondents’ rights and the confidentiality of the information given by them. 11. Implications of the research The research investigates the role of social exchange as critical facilitator of higher performance. The research outcome would therefore become highly pertinent in evaluating the various interacting elements of social exchange that can be exploited within LMX approach of organizational leadership for influencing employees’ turnover intentions. It would also encourage future research on the various imperatives of guanxi and multi-dimensional aspects of LMX approach in the private sector of Saudi Arabia. (words: 2630) Reference Bierke, B., & Al-Meer, A. (1993). 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