Piórkowska K., Managers’ loyalty as an organizational resource in the strategic context,
‘Managing Transformation with Creativity’, Omerzel D.G., Nastav B., Sedmak S. (eds.),
Corvinius University of Budapest, Budapeszt 2012, pp.
1053-1066,
ISSN 1854-4312.
MANAGERS’ LOYALTY AS AN ORGANISATIONAL RESOURCE IN
THE STRATEGIC CONTEXT
PhD Eng., Katarzyna Piórkowska, University of Economics in Wrocław, Poland
katarzyna.piorkowska@ue.wroc.pl
ABSTRACT
The paper’s aim is to analyse managers’ loyalty as an organizational resource in the
strategic context. The studies constitute the basis for developing the conceptual framework
and model of creating managers’ loyalty in enterprises. The main part of the paper concerns
the results of the research on attributes of managers’ loyalty constituting main features of an
internal and external dimension of the future model of creating managers’ loyalty in
enterprises.
The results of measuring managers’ loyalty from its attributes perspective were
presented in accordance with the criterion of respondents’ characteristics, the criterion of
enterprise’s size, and the criterion of a sector. Finally, the implications for further research in
this area were proposed.
Key words: managers’ loyalty, attributes of managers’ loyalty, managers’ loyalty ratio,
dimensions of managers’ loyalty, model of creating managers’ loyalty.
INTRODUCTION
Uncertainty, especially in strategic planning that has a relatively long period of existing, is a
main feature of the context of contemporary strategic management. Both in theory and in
practice the movement from a planning school of strategic management and a positional one
to an evolutionary approach and a resource-based view is noticed. For these latest not a long-
time plan but an opportunity (a chance, an occasion) becomes a basic category of growth
operationalization.
Resources, especially theirs possession and access to them, is significantly important for
flexible behaviour of organizations. Many definitions of flexibility refer to the potential of an
enterprise in the scope of using occasions. Consequently, it can be said that the determinant of
using occasions is, among others, to possess resources, especially to possess the redundancy
of resources, or at least to have the access to them. Nevertheless, this implication can be
perceived in a different way dependently on an exogenous or endogenous approach to the
strategy of an enterprise (or in other words on preferring a positional school or a resource-
based view in strategic management).
According to an exogenous perspective, a market is the most important and the essence of a
strategy is adaptation to requirements connected with a defined market position. The
adaptation including the usage of noticed occasions is determined by possessing (having an
access) resources, theirs redundancy and flexibility. Thus, a role of resources from an
exogenous perspective is rather tactical. Resources are rather the measure for realizing market
goals of an enterprise than a goal for its own.
According to an endogenic perspective, a situation is diverse. Not directed detailed actions,
but resources, the architecture of resources (configuration one another), having a potential of
activities are goals of an enterprise. An action understood as having a given market position
takes place at a tactical level. Consequently, a role of resources in using occasions means
creating a general potential in this scope and it is not connected with implementing a given
market strategy.
Literature studies unequivocally prove that contemporarily in strategic management resource-
based approaches are dominant. It means that a strategy of an organization should be
developed on a basis of original resources – rare in a sector and difficult to be copied.
According to empirical research of R. Krupski (Krupski 2006), (Krupski 2006a), mainly the
following resources reveal features of original resources: privileged non-formalised
relationships and employee attitudes, motivation and behaviour. Among these last
undoubtedly one of the most important is employee loyalty and managers’ loyalty.
The main goal of the paper is to present the results of empirical research on such a category of
attitude like managers’ loyalty in strategic context.
Managers’ loyalty – the concept and the structure of a loyalty strategy
Managers’ loyalty is a valuable strategic resource in an organization. This resource is also a
rare, difficult to imitate and to substitute resource. Generally, loyalty is defined in dictionaries
as the category of integrity, faithfulness and reliability between people. T.O. Jones and W.E.
Sassem Jr think that employee loyalty first of all means a feeling of a bond and attachment to
an organization (Rudawska 2005). On the other hand, F. Reichheld thinks that employee
loyalty is the willingness of a person – a customer, an employee, a friend to renounce in order
to deepen relations (Reichheld 2004, 44), (Reichheld 2001). A. Lipka treats employee loyalty
as a kind of organizational behaviour translating into employee’s attachment to a company
and being the feature of human resources (Lipka 2005, 76-77). Similarly, A.K. Koźmiński
names loyalty among other human resources’ qualities, namely employee commitment, an
ethical level, an innovation level and the ability to cooperate. These features are essential to
act in uncertain environment respond to unpredictable changes in environment, to create new
products, penetrate markets, enter into alliances and leave ones (Koźmiński 2004, 45). The
structure of a loyalty strategy can be presented as in the picture 1. Loyalty as an attitude
and/or the behaviour of a man towards other people is especially important in interpersonal
hierarchic relations, which are main relations in classical management (superior – inferior
relations). In this meaning, it is necessary to acknowledge loyalty as a peculiar valuable
resource (the figure 1). Loyalty enables to accomplish both superior and inferior goals and it
is also a goals indication by a superior – regardless of its basis (calculated loyalty or
emotionalism). Managers’ loyalty means managers’ identification with an organization,
strong emotional attachment arising due to identification with a chosen object. Loyalty creates
a feeling of closeness, safety and commitment (especially affective commitment entailing
Organizational Citizenship Behaviour). It facilitates the conduct in accordance with
established norms parallel to the skill of a continuous critical attitude.
The expected
effects of
managers’ loyalty
Vision
A valuable resource:
the importance of loyalty for an organization
The way of resource’s
acquiring:
the consolidation and
development of a
loyalty system
Distinctive features of
loyalty: psychological,
personnel,
organizational
Skills
in a range of managers’ loyalty
which is used for both
occasion exploit and value
generation for an organization
Figure 1. The strategy of employee loyalty as a system UC (adapted from Krupski, Piórkowska 2008).
The research methodology
1
So as to verify the veracity of assumptions made on a basis of literature studies and
concerning dimensions (features) of managers’ loyalty the qualitative studies and quantitative
ones were planned. The research is the part of a research project conducted in Poland in a year
2011 and 2012 titled ‘Managerial attitudes from a strategic perspective’ (a research project
no. ZIF/KSMZ-411/7/11).
The research on managers’ loyalty was rooted in the following paradigms: critical theory,
structuralism, theory of social conflict, theory of exchange, symbolic interaction, naturalism,
ethnomethodology, grounded theory, ethnography, an interpretative paradigm, and a
paradigm of radical humanism. Using theoretical triangulation determined using
methodological triangulation in studies.
The character of studies on managers’ loyalty constituting the element of research in
management science is determined by descriptive-normative methodology and precised
methodology that is characteristic for detailed empirical science, especially social science
including management one.
Using deduction and induction connotative meaning of ‘loyalty’, and attributes of managers’
loyalty were identified. An analogy in a close version and comparison of selected enterprises
with a defined level of managers’ loyalty was also used.
A direct interview – personal free slightly directed (non-standardized), a direct interview with
a standardized list of sought information, a behavioural interview, and a situational interview
were used.
1
The main assumptions of the research methodology were adapted from the research on creating employee
loyalty in enterprises conducted in Poland in a year 2007 in the scope of PhD thesis.
The assumption that managers’ loyalty is a polytomous variable was made. It is frequently
said that loyalty is a variable with various intensity towards its subject or object. It is also
regarded that it is a quantitative and metric variable.
A sample group turned out to be a sequential one. Probabilistic sampling was not used due to
difficulties with respondents’ availability. Consequently, as a result of not successful
probabilistic attempts sampling based on respondents’ availability was used. Managers from
top management, middle management, and low management (156 managers from 72
enterprises) from Poland (especially Lower Silesia) were surveyed.
The precised goals of the research were as follows: a) to identify connotative meaning of
managers’ loyalty, b) to identify attributes of managers’ loyalty, c) to measure a level of
managers’ loyalty in researched enterprises.
A table 1 presents the features of a loyal manager due to respondents’ opinions with a number
and percentage structure of these views.
Table 1. The features of a loyal manager due to respondents’ opinions
The features of a loyal manager due to respondents’ opinions
A
number
structure
of
indications
(from 156)
Indications
[%]
Honesty towards an owner
69
44,23%
Honesty towards co-workers
45
28,85%
Enhancing a market position of a company
72
46,15%
Punctuality
25
16,03%
A sense of duty
31
19,87%
Not sharing information about the enterprise with people beyond
the company
66
42,31%
Commitment with co-workers
46
29,49%
Caring about a positive image of an enterprise
65
41,67%
Caring about welfare of an enterprise
68
43,59%
Preference of organization welfare to own one
58
37,18%
Interesting in a lot and the future of an enterprise
71
45,51%
Responsibility
33
21,15%
Following the established norms
35
22,44%
Meeting obligations
24
15,38%
Devoting to work in an enterprise
59
37,82%
Integrity and conscientiousness
68
43,59%
Informing an owner about problems and willingness to solve
problems mutually
66
42,31%
Ability to devote oneself, ability to more efforts when a situation
requires it
55
35,26%
Emotional attachment to an enterprise
69
44,23%
Not discouraging by temporary problems of an enterprise,
willingness to help a company
39
25,00%
Caring about positive climate in an enterprise
28
17,95%
Sharing experience, ideas, information with co-workers
70
44,87%
Conformity of own occupational goals with enterprise’s goals
77
49,36%
Openness
39
25,00%
Willingness to meet expectations of an owner
56
35,90%
Caring about material goods of an enterprise
61
39,10%
Identifying with an enterprise
58
37,18%
Trustworthy
50
32,05%
Engagement
69
44,23%
Not avoiding critics
22
14,10%
Feeling of co-responsibility for an enterprise
68
43,59%
Willingness to contributing to enterpise’s growth
74
47,44%
Not exposing an enterprise to financial and moral loses
55
35,26%
Not abandoning an enterprise in a case of better work offers
59
37,82%
Willingness to develop qualifications for organization’s growth
44
28,21%
Not working for competitors
59
37,82%
Source: own study.
The features of a loyal manager mostly pointed by respondents were as follows: a) enhancing
a market position of a company, b) caring about welfare of an enterprise, c) interesting in a lot
and the future of an enterprise, d) integrity and conscientiousness, e) sharing experience,
ideas, information with co-workers, f) conformity of own occupational goals with enterprise’s
goals, g) engagement, h) feeling of co-responsibility for an enterprise, i) willingness to
contribute to enterprise’s growth, j) honesty towards an owner, k) caring about a positive
image of an enterprise, l) not sharing information about the enterprise with people beyond the
company, ł) emotional attachment to an enterprise.
Consequently, the following meaning of the notion ‘managers’ loyalty’ was adopted.
Managers’ loyalty considered in two dimensions (as an attitude and behaviour) means
identifying with an enterprise, strong emotional attachment resulting from the fact that
identification with a selected object creates the feeling of closeness and safety, commitment
(especially affective implicating Organizational Citizenship Behaviour), representing and
realizing organization’s goals, creating a positive image of an enterprise, aiming to
organization’ growth, enhancing a market position of a company, protecting tangible and
intangible resources of an enterprise.
According to attributes of a loyal manager mainly pointed by respondents and according to
literature studies, the measure of managers’ loyalty in surveyed enterprises was made. The
measure was based on a ratio determining an average level of managers’ loyalty and taking
into consideration the evaluation of particular attributes of managers’ loyalty. The evaluation
was made on a basis of Likert scale. A table 2 presents a level of managers’ loyalty
dependently on a value from the scale.
Table 2. A level of managers’ loyalty dependently on a value from the scale
A level of managers’ loyalty
Value
A manager is strongly loyal
(4 – 5]
A manager is loyal but not satisfactorily
(3,5 – 4]
It is difficult to assess a level of managers’ loyalty, it is rather average
(3 – 3,5]
A manager is rather disloyal
(2 – 3]
A manager is strongly disloyal
[1 – 2]
Source: own study.
The key research results
Managers’ loyalty in surveyed enterprises was evaluated averagely at the level 3,98. A table 3
presents the percentage share of respondents regarding a level of managers’ loyalty.
Table 3. The percentage share of respondents regarding a level of managers’ loyalty
A level of managers’ loyalty
The
share
of
respondents [%]
A manager is strongly loyal, scale (4 – 5]
33,24
A manager is loyal but not satisfactorily, scale (3,5 – 4]
28,19
It is difficult to assess a level of managers’ loyalty, it is rather average,
scale (3 – 3,5]
24,51
A manager is rather disloyal, scale (2 – 3]
11,96
A manager is strongly disloyal, scale [1 – 2]
2,10
Source: own study.
A table 4 presents a level of managers’ loyalty from a general perspective and due to criteria
describing respondents. A table 5 presents a matrix of correlation between attributes of
managers’ loyalty. A table 6 presents a level of managers’ loyalty in reference to the criterion
of enterprise’s size. A table 7 shows a level of managers’ loyalty in reference to the criterion
of a sector.
In the process of analyzing research data the following criteria were considered: the criterion
of respondents’ characteristics, the criterion of enterprise’s size, and the criterion of a sector.
Taking into consideration the criterion of respondents’ characteristics (see the table 4) and
considering education empirical data authorize the statement that respondents with higher
education revealed a relatively bigger level of loyalty. According to the conditions of
employment, the highest value of a managers’ loyalty ratio was noted in a case of a
managerial contract and a contract for an indefinite period. According to the criterion of
enterprise’s size measured by a number of employees, the highest value of a managers’
loyalty ratio was observed in micro- enterprises and the lowest in small companies (see the
table 6). According to the criterion of a sector, the following sectors were taken into
consideration: a mining industry, trade, production, services. The highest value of a
managers’ loyalty ratio was noted in a production sector; the lowest in services (see the table
7).
Table 4. A level of managers’ loyalty from a general perspective and due to criteria describing respondents
Source: own study.
Respondents’
characteristics
1
2
3
4
5
6
7
8
9
10
11
12
13
The average evaluation
The variance
All respondents
4,41 3,86
3,40
4,20
3,75
3,38
4,12
3,95
4,42
4,00
4,25
4,00 3,96
3,98
0,34
Secondary school
degree
4,20 3,50
2,80
2,50
3,50
2,84
3,20
3,51
3,22
3,05
3,31
3,95 4,21
3,37
0,48
Higher education (BA,
MA, PhD)
4,15 4,10
3,65
3,88
3,52
3,15
3,99
3,80
4,02
3,90
4,05
3,95 4,06
3,86
0,32
A contract for an
indefinite period
4,45 3,98
3,60
4,35
3,85
3,42
4,00
4,12
4,50
4,10
4,15
3,95 4,12
4,04
0,20
A fixed-term contract
of employment
4,10 3,72
3,07
3,95
3,55
3,07
3,98
3,92
4,21
3,55
3,95
3,68 3,85
3,74
0,37
Civil law agreement
(mandate, specific task)
3,96 3,96
3,50
3,80
3,65
2,95
3,86
3,50
3,65
4,00
4,15
3,95 3,55
3,73
0,32
A managerial contract
4,45 3,92
3,65
4,25
3,95
3,56
4,15
4,25
4,56
4,25
4,12
3,98 4,08
4,09
0,30
Legend:
1 – Enhancing a market position of a company
2 - Caring about welfare of an enterprise
3 – Interesting in a lot and the future of an enterprise
4 -
Integrity and conscientiousness
5 – Sharing experience, ideas, information with co-workers
6 – Conformity of own occupational goals with enterprise’s goals
7 – Commitment
8 – Feeling of co-responsibility for an enterprise
9 – Willingness to contributing to enterprise’s growth
10 – Honesty towards an owner
11 - Caring about a positive image of an enterprise
12 - Not sharing information about the enterprise with people beyond the company
13 - Emotional attachment to an enterprise
Table 5. A matrix of correlation between attributes of managers’ loyalty
Source: own study.
Attributes
of
managers’
loyalty
1
2
3
4
5
6
7
8
9
10
11
12
13
1
0,71
0,65
0,54
0,48
0,59
0,60
0,65
0,68
0,49
0,66
0,54
0,58
2
0,66
0,70
0,58
0,69
0,71
0,58
0,59
0,55
0,55
0,56
0,78
3
0,55
0,47
0,68
0,55
0,68
0,60
0,58
0,54
0,51
0,60
4
0,51
0,45
0,48
0,55
0,49
0,54
0,48
0,52
0,49
5
0,51
0,42
0,45
0,45
0,40
0,37
0,41
0,39
6
0,59
0,61
0,59
0,58
0,50
0,51
0,55
7
0,75
0,74
0,65
0,57
0,68
0,33
8
0,65
0,62
0,58
0,69
0,58
9
0,66
0,55
0,65
0,55
10
0,60
0,55
0,61
11
0,66
0,72
12
0,69
13
Legend:
1 – Enhancing a market position of a company
2 - Caring about welfare of an enterprise
3 – Interesting in a lot and the future of an enterprise
4 -
Integrity and conscientiousness
5 – Sharing experience, ideas, information with co-workers
6 – Conformity of own occupational goals with enterprise’s goals
7 – Commitment
8 – Feeling of co-responsibility for an enterprise
9 – Willingness to contributing to enterprise’s growth
10 – Honesty towards an owner
11 - Caring about a positive image of an enterprise
12 - Not sharing information about the enterprise with people beyond the company
13 - Emotional attachment to an enterprise
Table 6. A level of managers’ loyalty in reference to the criterion of enterprise’s size
Respondents’
characteristics
1
2
3
4
5
6
7
8
9
10
11
12
13
The average
evaluation
The variance
All respondents
4,41
3,86
3,40
4,20
3,75
3,38
4,12
3,95
4,42
4,00
4,25
4,00 3,96
3,98
0,34
Micro- enterprises
4,21
3,77
3,45
3,95
3,85
3,23
4,00
4,02
4,18
3,96
4,18
3,99 4,02
3,91
0,29
Small enterprises
3,45
2,96
3,23
3,48
3,15
2,95
3,56
3,29
3,73
3,12
2,97
3,55 3,40
3,30
0,26
Medium enterprises
3,66
3,44
3,25
3,85
3,35
3,25
3,65
3,55
3,71
3,11
3,18
3,12 3,51
3,43
0,24
Big enterprises
3,75
3,48
3,25
3,95
3,33
3,41
3,76
3,65
3,82
3,26
3,74
3,25 3,65
3,56
0,24
Legend:
1 – Enhancing a market position of a company
2 - Caring about welfare of an enterprise
3 – Interesting in a lot and the future of an enterprise
4 - Integrity and conscientiousness
5 – Sharing experience, ideas, information with co-workers
6 – Conformity of own occupational goals with enterprise’s goals
7 – Commitment
8 – Feeling of co-responsibility for an enterprise
9 – Willingness to contributing to enterprise’s growth
10 – Honesty towards an owner
11 - Caring about a positive image of an enterprise
12 - Not sharing information about the enterprise with people beyond the company
13 - Emotional attachment to an enterprise
Source: own study.
Table 7.
A level of managers’ loyalty in reference to the criterion of a sector
Respondents’
characteristics
1
2
3
4
5
6
7
8
9
10
11
12
13
The average
evaluation
The variance
Mining industry
3,35
3,65
3,55
3,30
3,65
3,45
3,84
3,58
3,99
3,30
3,55
3,58
3,25
3,54
0,22
Trade
3,39
3,58
3,02
3,01
3,24
2,98
3,45
3,76
3,65
3,55
3,76
3,25
3,56
3,34
0,28
Production
3,66
3,46
3,25
4,25
3,56
3,45
3,35
3,75
3,96
3,66
3,45
3,66
3,44
3,61
0,27
Services
3,35
3,19
3,31
3,01
3,24
3,01
3,18
3,44
3,42
3,28
3,33
3,14
3,25
3,24
0,14
Legend:
1 – Enhancing a market position of a company
2 - Caring about welfare of an enterprise
3 – Interesting in a lot and the future of an enterprise
4 -
Integrity and conscientiousness
5 – Sharing experience, ideas, information with co-workers
6 – Conformity of own occupational goals with enterprise’s goals
7 – Commitment
8 – Feeling of co-responsibility for an enterprise
9 – Willingness to contributing to enterprise’s growth
10 – Honesty towards an owner
11 - Caring about a positive image of an enterprise
12 - Not sharing information about the enterprise with people beyond the company
13 - Emotional attachment to an enterprise
Source: own study.
Directions for further research
A presented part of research is the part of studies connected with developing a model of
creating managers’ loyalty in enterprises. Determining attributes of a loyal manager it is
necessary to set managers’ loyalty dimensions (internal: an attitude, external: behaviour) that
are one part of a mentioned model. So as to create a complete managers’ loyalty model apart
from studying dimensions of managers’ loyalty determining managers’ loyalty factors and
determinants influencing a level of managers’ loyalty should be researched. It requires
conducting further research on managers’ loyalty and it will be the subject of the next part of
studies.
THE KEY CONCLUSIONS
Summing up considerations about managers’ loyalty in surveyed enterprises the following
conclusions were formulated:
1.
Researched managers turned out to be loyal but not satisfactorily.
2.
Managers with higher education represented a higher value of loyalty.
3.
A managerial contract and a contract for an indefinite period are important conditions
creating managers’ loyalty.
4.
All correlations between particular attributes of a loyal manager constitute statistically
significant correlations and strong or moderate correlations what means that existence or a
lack of a given attribute of a loyal manager determines existence or a lack of other
attributes of a loyal manager.
5.
The following attributes of managers’ loyalty had the highest values of a managers’ loyalty
ratio: enhancing a market position of a company, integrity and conscientiousness,
commitment, willingness to contribute to enterprise’s growth, honesty towards an owner,
caring about a positive image of an enterprise, not sharing information about the enterprise
with people beyond the company.
6.
According to the criterion of enterprise’s size, the highest value of a managers’ loyalty was
observed in micro- enterprises and big ones, and the lowest in small companies.
7.
According to the criterion of a sector, the highest value of managers’ loyalty ratio was
noted in a production sector, the lowest in services.
8.
A level of managers’ loyalty determines qualitative and quantitative intensity of
correlations between particular attributes of managers’ loyalty.
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