Guarding Against Turnover Contagion

Aug 31, 2017
Management
As Featured In 
Academy of Management Review

A 360-degree Approach Can Anchor Teams

Organizations need strong leaders who can build high-quality relationships with their subordinates. But the same leaders create a liability when they exit because loyal employees will often follow them out the door. The result can be “turnover contagion.”

The opposite happens when bad leaders depart. Employees are more likely to celebrate. So what’s an organization to do? Research by four authors, including professors Debra L. Shapiro and Rajshree Agarwal at the University of Maryland’s Robert H. Smith School of Business, explores ways to anchor employees to their organizations so they don’t want to leave.

The key is to invest in organization-wide developmental climates that feature developers at all levels — top-down, laterally and bottom-up — so employees never depend too much on any one person for their support. “A 360-degree relational perspective means that developers may not necessarily be authority figures or even people more senior in the organization,” Shapiro says.

Learning cultures like this don’t happen by accident. Shapiro says organizations must work to align their incentives, rewards, training programs and performance appraisal systems to encourage a range of multidirectional developmental activities. Organizations must also promote many development roles, including but not limited to mentor, coach, sponsor and friend.

Nothing lasts forever, including the tenure of a great leader. “It’s natural for great leaders to move on to other career opportunities,” Shapiro says. “But losing strong leaders admired and trusted by their employees need not weaken organizational attachment.”

Read more: How do leader departures affect subordinates’ organizational attachment?: A 360-degree relational perspective is featured in the Academy of Management Review.

About the Author(s)

Rajshree Agarwal

Rajshree Agarwal is the Rudolph Lamone Professor of Entrepreneurship and Strategy and director of the Ed Snider Center for Enterprise and Markets at the University of Maryland. She studies the evolution of industries, firms and individual careers, as fostered by the twin engines of innovation and enterprise. Agarwal's scholarship uses an interdisciplinary lens to provide insights on strategic innovation for new venture creation and for firm renewal. She routinely publishes in leading journals in strategy and entrepreneurship. An author of more than 60 studies, her research has been cited more than 10,000 times, received numerous best paper awards, and funded by grants from various foundations, including the Kauffman Foundation, the Rockefeller Foundation and the National Science Foundation. She is currently the co-editor of the Strategic Management Journal and has previously served in co-editor and senior editor roles at Strategic Entrepreneurship Journal and Organization Science respectively.

Debra L. Shapiro

Debra L. Shapiro (Ph.D. Northwestern U) is the Clarice Smith Professor at the U of Maryland (UMD), formerly the Willard Graham Distinguished Professor at UNC-Chapel Hill where she was 1986-2003. Debra has led UNC's and MD's business schools' PhD Programs (as Associate Dean at UNC from 1998-2001 and UMD from 2008-2011).

More in

Management

How Noncompete Agreements Stifle Workers
Maryland Smith’s Evan Starr has extensively studied noncompetes, with the same conclusion: the agreements hurt workers.
Dec 03, 2020
Show Your Work: A Plea For Better Research Methods
A new paper says management researchers should show more data and use a simple graphical tool.
Dec 03, 2020
Leadership Lessons from Japan’s Cotton Spinning Industry
When it comes to a company’s success, is it better to have one strong leader at the top or several leaders sharing responsibilities? The early Japanese cotton spinning industry might have the answer.
Nov 10, 2020
Robert H. Smith School of Business