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46
Human Capital and Organizations
e-ISSN: xxxx-xxxx
Homepage: https://sanscientific.com/journal/index.php/hco
1(1) 46-54 (2023)
DOI: https://doi.org/10.58777/hco.v1i1.121
Research Article
The Effect of Leadership and Teamwork on Employee
Turnover and Team Performance
Alin Rizkiani Putri1, Joseph M.J. Renwarin2^
1-2 Faculty of Communication and Business, Kalbis Institute of Technology and Business,
Jakarta, Indonesia
Received:10 Aug 2023; Accepted: 25 Sep 2023; Online: 08 Oct 2023;
Abstract
This study aims to investigate the influence of leadership and teamwork on team performance
while exploring the potential effects of team turnover. Our methodology involved distributing
questionnaires to 60 individuals who met our specific criteria. The data collected was analyzed
using the advanced statistical analysis software SPSS 20.0. Our findings indicate that leadership
and teamwork are crucial in team performance, with a significant impact observed. Additionally,
our research indicates that team turnover does not affect team performance. For a company to
achieve optimal success and productivity, it is imperative to thoroughly examine and analyze the
influence of leadership and teamwork on team performance and turnover. By doing so,
organizations can better understand the underlying factors contributing to these outcomes and
make informed decisions to enhance team dynamics and drive positive results.
Keywords: Leadership, teamwork, turnover intention, team performance
JEL Classification: M00, M50, M54
How to cite: Putri, A. R., Renwari, J. M. J., (2023). The Effect of Leadership and Teamwork on
Employee Turnover and Team Performance, Human Capital and Organizations (HCO)
1(1), 46-55
Corresponding author: Joseph M.J. Renwarin (joseph.renwarin1@gmail.com)
This is an open-access article under the CC-BY-SA international license.
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1. Introduction
The business industry faces intense competition in domestic and foreign markets in today's
globalized world. Job seekers must possess globally recognized competencies to stand out and
succeed in foreign markets. Even in the domestic market, a high level of competence is necessary
to outperform competitors. As of February 2020, the working-age population in Indonesia was
199.4 million, an increase of 2.92 million from the previous year, according to the Central Statistics
Agency (BPS). This statistic means prospective employees must compete with at least 199.4 million
Indonesians to enter the workforce. The working-age population includes individuals aged 15 years
and above. To succeed in this competitive landscape, prospective employees must have academic
and non-academic competencies that can set them apart and act as a selling point to potential
employers. Companies seek out employees with desirable competencies to maximize their
effectiveness and performance. Hence, a well-managed human resources department can
significantly benefit a company and help achieve its goals. From recruitment to training, how HR
is handled can directly impact employee performance in the future. Companies need to control
their human resources to avoid problems and reduce expenses. One problem that can arise from a
lack of control is employee turnover, which has become a trend in the business world, especially
with the entrance of Generation Z into the workforce.
Over the past few years, a concerning phenomenon has affected entrepreneurs' businesses. The
issue is that high employee turnover rates can significantly reduce a company's productivity and
increase costs associated with recruiting and training new employees. Additionally, the remaining
employees may experience changes in their work environment, leading to feelings of laziness and
stress due to an increased workload. Ultimately, this can trigger a desire to leave the company and
move to a more stable environment (Kim et al., 2021; Rani & Samuel, 2016).
Studies have identified multiple factors influencing an employee's intention to leave. These factors
include organizational characteristics, workplace culture, interpersonal relations, and management
style. The work environment, such as workload, perceived justice, financial incentives, working
conditions, and access to power, also plays a role. Individual factors like demographics, vocational
drive, professional values, job satisfaction, work incivility, performance, work engagement,
commitment, burnout, and role perceptions (Lu & Gursoy, 2016; Siahaan & Gatari, 2020;
Tricahyadinata et al., 2020). External factors like work-life balance and the job market also impact
employees' decisions to leave their jobs (George & Wallio, 2017; Kim et al., 2021; Tricahyadinata
et al., 2020). The present study studies leadership and teamwork as determinants of turnover
intentions and their subsequent effects on team performance.
Studies have shown a negative relationship between leadership style and employees' intention to
leave their jobs across various industries (Sulamuthu & Yusof, 2018). However, study found that
teamwork did not significantly affect turnover intention. They concluded that there was no
relationship between leadership style, teamwork, and employee turnover intention. On the other
hand, Kim Siew (2017) found that the transformational leadership style had a more significant
contribution to turnover intention than the transactional leadership style within small and medium-
sized enterprises (SMEs) in Malaysia. Another study by Zaheer et al. (2019) revealed that positive
teamwork perceptions can affect turnover intentions. Kim Siew and Zaheer concluded that
leadership style and teamwork contribute the most to turnover intention (Zaheer et al., 2019). In
light of these findings, further research is necessary to determine the extent of influence that
leadership and teamwork have on employee turnover and team performance. To improve
employee performance, leaders must provide support and value for employee contributions while
attending to their welfare. Team performance can be measured by task completion and employee
participation in company contribution. This study aims to investigate the factors of leadership and
teamwork that affect employee turnover and their impact on team performance, with the research
subjects being employees of PT. DTI.
2. Literature Review and Hypothesis
Social exchange theory (Blau, 1964) suggests that social behavior results from an exchange process.
People assess the potential rewards and risks of their social relationships. They may end or abandon
the relationship if the risks outweigh the benefits. The goal of this exchange is to maximize rewards
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and minimize costs. Although most relationships involve some level of give-and-take, they are not
always equal. Social exchange theory suggests that the value of benefits and costs determine
whether to continue a social association. The theory proposes that we subtract the costs from the
benefits to determine the relationship's worth. Costs such as investing money, time, and effort into
a relationship are considered harmful. Benefits are considered positive aspects, such as fun,
friendship, companionship, and social support. A friend may be a freeloader but also bring
excitement and enjoyment to life. The benefits outweigh the potential costs when evaluating the
value of the friendship. Hence, how employees decide to remain organized closely relates to their
consideration of process exchanges. For example, employees treated well by their leadership tend
to produce more committed employees who strive to repay this kindness by working better.
Leadership
Leadership is an integral aspect of team performance, and it is vital to have a skilled leader who
can inspire, guide, and influence team members to work productively and achieve common
objectives. Effective leadership entails a wide range of qualities and attributes that enable leaders
to inspire and motivate team members to work hard and feel enthusiastic about their work. One
critical quality of a leader is their ability to share a clear vision of the team's goals and inspire team
members to aim for them. When leaders can communicate the values and purpose of work, it helps
move the team in the desired direction and create a sense of direction and focus. A skilled leader
should also be able to build strong teamwork among team members. They should know how to
form effective teams, develop trust and relationships between team members, encourage
collaboration, and resolve conflicts wisely. Leaders fostering harmonious and synergistic teamwork
can help increase productivity and create a positive work environment (Boies et al., 2015). A leader
must be able to identify each team member's strengths and weaknesses, assign tasks accordingly,
and create an environment where team members feel valued and supported.
In summary, effective leadership is critical to the success of any team. Leaders who possess the
above qualities can inspire, motivate, and guide team members to achieve their goals and enable
them to work together harmoniously to achieve common objectives. By building strong teamwork
and fostering a positive work environment, leaders can increase productivity, achieve better results,
and create a culture of excellence within the team (Achmadi et al., 2022; Chiu & Hung, 2020;
Lyubovnikova et al., 2017).
H1: There is a significant correlation between leadership and team performance.
Turnover is a global problem, costing organizations and countries massive amounts of money.
More specifically, Robbins et al. (2015) explain that turnover is voluntary or involuntary
withdrawal, an individual's decision to leave an organization caused by the lack of attractiveness
of the current job and the availability of other job alternatives. It can be concluded that turnover is
the withdrawal or replacement of employees who voluntarily leave the organization due to job
dissatisfaction, which can cause losses.
The role of leadership in an organization is crucial as the behavior of the leaders can either enhance
or deteriorate the organization. The direction and approach of the organization are influenced by
the style of leadership adopted by its leaders. Leadership is essential in shaping the organization's
plans, and leaders' actions and practices encourage their followers to strive to achieve the goals.
Therefore, the followers often emulate their leaders' behavior while performing their duties
(Maaitah, 2018). A positive relationship between employees and their leaders can reduce turnover
intention. Leaders who listen, care, and are fair to employees tend to build strong relationships.
Additionally, when employees feel they are treated well by their leaders, they are likelier to stay
with the company. Previous studies have confirmed the relationship between leadership and
turnover intention (Ausar et al., 2016; Azanza et al., 2015; Magbity et al., 2020; Park & Pierce,
2020; Ribeiro et al., 2018); hence, this study also proposes a similar hypothesis:
H2: Leadership influences turnover intention.
Teamwork
Teamwork is the process of a group working together on a task characterized by effective
coordination, communication, decision-making, conflict management, and performance feedback
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that all individuals must learn. We can see good teamwork in the company atmosphere. A
harmonious company atmosphere and minimal conflict signal that teamwork is running smoothly.
A leader can only lead well with cohesion in the team he leads. Good teamwork is characteristic
of being open to others and fellow team members. Implementing an open system will make joining
the team easier for new employees. With this, new employees will feel welcome, and the
atmosphere will run as well as it should (Rydenfält et al., 2019).
Working together involves effective coordination, communication, decision-making, conflict
management, and performance feedback. All individuals must learn these skills to contribute to the
task's success. A company with minimal conflict and a harmonious atmosphere indicates good
teamwork. A leader can only lead well with a cohesive team. Openness to new ideas and team
members is crucial to successful teamwork. An open system makes it easier for new employees to
join the team and feel welcome, contributing to a positive atmosphere. Working together as a team
encourages members to collaborate towards achieving shared objectives. Collaboration allows
Team members to share ideas, information, and resources more effectively. This collaboration
helps to avoid duplicating work and make the most of each individual's expertise. In a cooperative
team, any arising problems can be resolved much faster and more efficiently. Team members can
bring diverse perspectives to the table and think creatively. By working collaboratively, teams have
access to a wealth of intellectual resources, enabling them to overcome challenges and find optimal
solutions. Weimar et al. (2017) found that team performance is closely linked to the quality of
teamwork, as assessed by both team members and stakeholders. Berber et al. (2020) further explain
that positive relationships exist between teamwork performance and factors such as innovative
behavior of team members, quality, and teamwork synergy.
H3: Teamwork influences team performance
The impact of employee turnover on team performance is a critical aspect that cannot be
overlooked. The influence can be either positive or negative and depends on various factors. The
reasons behind the employee's departure, how the replacement is managed, and the new
employee's integration into the team are some significant factors that come into play. Suppose a
skilled and experienced team member leaves. In that case, the team loses valuable knowledge and
expertise, severely impacting performance unless a replacement plan exists.
Moreover, when an employee leaves, there is a transition period that the team must undergo, which
can further impact productivity. During this time, the team may experience a decrease in
productivity as they adjust to the new members and change work processes. This period can be
challenging, and it is crucial to manage it well to ensure that the team adjusts effectively. It is
essential to address these transitions effectively to maintain team cohesion and ensure that the team
continues to deliver results (Jiang et al., 2019; Lee, 2018; Pieper et al., 2019). In addition, a study
conducted by Osman et al. (2015) demonstrated that teamwork fosters strong commitment among
team members. Additionally, two-way communication is essential as it encourages feedback,
ensures clear job expectations, and helps maintain long-term relationships within the team. These
findings are further supported by the conclusions of Hidayah and Chaerudin (2020), who found
that teamwork positively impacts employee turnover.
H4: Turnover influences team performance
3. Data and Method
The population in this study were employees from PT DTI, both female and male, from the lower
classes to the upper classes, with an uncountable population. The research sample consisted of 60
randomly selected employees using a convenience approach. In order to conduct our study, we
employed a combination of primary and secondary data collection methods. To gather primary
data, we utilized online questionnaires through Google Forms, which were directly distributed in
the field. Meanwhile, secondary data was gathered through a comprehensive literature review of
various scientific journals, books, and mass media sources. Our research was conducted in Jakarta
in 2021, and we distributed questionnaires over three months to ensure a thorough sampling. We
created, distributed, collected, and processed the questionnaires.
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Most respondents, accounting for 68% or 41 participants, were female. The remaining 32% or 32
respondents were male. The data indicates that the questionnaire was primarily distributed to
female workers, constituting 89% of the respondents. The age group with the most participants was
18-25 years, accounting for 90% or 54 respondents. The second-ranked age group was 26-35 years,
comprising 8% or five respondents. Only 2% or one respondent belonged to the age group of 36-45
years, and there were no participants over 45. The results show that the age group of 18-25 years
was dominant in this study, with 90% of the participants falling into that category. In terms of
education, 67% or 40 respondents had at least SMA/SMK education. The second-ranked group
had an S1 degree, accounting for 32% or 19 respondents. Only 1% or one respondent belonged to
the S2 group, while no participants were from the D3 and Others groups. The findings of this
research indicate that SMA/SMK education was the dominant characteristic among the
participants, accounting for 67% of the final education category.
In this research, leadership is described as the ability to influence a group towards a common goal,
whether appointed formally or informally. Two dimensions related to leadership are Inspirational
Motivation and Intellectual Stimulation. Teamwork, on the other hand, is defined as a group of
individuals assigned to work together on a task, and the dimensions related to teamwork in this
study are interacting with teammates and conflict management. Turnover, which is the voluntary
or involuntary withdrawal of an individual from an organization, is caused by factors such as the
lack of attractiveness of the current job and the availability of other job alternatives. Two
dimensions related to turnover in this research are job embeddedness and commitment. Lastly,
team performance is a crucial measure of efficient human resource management that companies
must produce. Effective team performance is crucial for management in managing human
resources to ensure efficient company operations. It is a significant component of "healthy
organizational outcomes," encompassing a holistic approach beyond work-related aspects. There
are two dimensions related to team performance in this research - discipline and co-workers
(colleagues).
4. Results and Discussion
After calculating the coefficient table, the results of the multiple linear regression are as follows:
Initially, during the path analysis test, it was observed that the turnover variable did not impact the
team performance variable. However, it was found that the leadership and teamwork variables
directly affected team performance. Upon further testing using the Sobel test, it was discovered that
the turnover variable can influence the team performance variable. Consequently, the leadership
and teamwork variables do not directly affect team performance. These two tests have concluded
that each company can have different results when assessing or improving team performance. The
turnover variable may or may not intervene in team performance.
The structural model was evaluated using R Square for intervening and dependent variables, as
well as the significance of the structural path coefficients in Figure 1 and the t-test for hypotheses.
Moreover, compare equations one and two using SPSS media and the Sobel Test. The following
are the results of linear regression tests on leadership and teamwork variables on turnover.
The research indicates that leadership plays a crucial role in team performance, with a t count of
4.222. The Pearson correlation results reveal that the leaders who allow team members to view
problems as learning opportunities (K1.1) and encourage them to solve problems calmly (K1.5)
have the most significant impact on the inspirational motivation dimension. In the intellectual
stimulation dimension, the leaders who provide direction on work to be carried out (K2.1) and
listen to their employees' ideas (K2.5) have the highest value as causal indicators. These four
statements impact team performance on the leadership variable. This result aligns with previous
research that found that different full-range leadership styles have varying degrees of effectiveness
as direct and indirect predictors of team performance. Although there are slight variations in the
results from previous research, leadership variables significantly influence team performance.
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Table 1. Regression analysis
Coeff
SE
b
t-value
sig
Model 1 Turnover
Leadership
0.457
0.159
0.401
2.883
0.006
Teamwork
0.310
0.136
0.318
2.288
0.026
Model 2 Team
performance
Leadership
0.506
0.120
0.472
4.222
0.000
Teamwork
0.312
0.100
0.340
3.121
0.003
Turnover
0.108
0.094
0.114
1.152
0.254
According to the research conducted at PT DTI, it was found that teamwork has a significant
impact on team performance, with a t-value of 3.121. The highest correlation was observed in the
Interacting with Teammates dimension, mainly when each member contributes their thoughts and
energy (TW1.2) and when team members have a sense of trust (TW1.4). Additionally, the Conflict
Management dimension significantly influenced team performance by finding solutions for every
problem (TW2.5) and being responsible for the quality of work (TW2.2). These four statements
were identified as crucial factors that affect the team's performance at PT Dreamaxtion Teknologi
Internasional. The study conducted by Weimar et al. (2017) also supports the idea that the quality
of teamwork is significantly related to team performance. Similarly, suggest that good teamwork
can lead to higher team performance and satisfaction. In conclusion, teamwork is crucial in
determining team performance.
Turnover does not significantly impact team performance, as seen with a t count of 1.152. Although
the Job Embeddedness dimension has the highest value in Pearson correlation results, employees
may still leave for a higher salary offer from another company (TO1.1) while being satisfied with
their current job that suits their abilities (TO1.4). On the other hand, in the Commitment
dimension, employees feel that the company has made a significant contribution to their lives
(TO2.5), and they desire to continue working there (TO2.3). These statements do not affect team
performance, even though they have the highest values in each dimension at PT Dreamaxtion
Teknologi Internasional on the turnover variable. These findings are consistent, which also states
that a higher turnover rate does not affect team performance. Although there may be slight
differences in the results between this research and previous research, the turnover variable can
impact or mediate team performance, depending on the company.
Implication
With advances in science and technology, it has become the basis for development in the business
world, especially human resource management. With that, the management of PT. DTI has
determined that the products offered are technology-based. Data is entered, managed, and
produced using the help of technology. PT. DTI is an integrated human resources solutions
company committed to improving recruitment and assessment for companies, academics, and
talent. This company was founded in 2017 as a service and information technology in Human
Capital and technology-based self-assessment. PT. DTI has a superior product, namely
Dreamtalent. Dreamtalent is an online psychometric testing platform for recruiting and predictive
assessment. Individuals and companies can access this platform to determine whether they suit
themselves and prospective employees Dreamtalent's role at PT. DTI, which manages employee
data, plays a significant role and helps HRD recruit, train, and place employees within the
company. Dreamtalent is not only intended for companies; young people and even older adults
can also access it to discover their interests, work preferences, and personal character. Not only is
the psychometric test website offered by PT. DTI also offers training programs they have created
and tested first and are ready to use in companies that need employee training programs.
The team performance variable showed that the discipline dimension obtained the highest score in
the KT1.1 indicator, which states that employees obey the regulations set by the institution.
Management is advised to retain existing employees and be selective in hiring those who comply
with company rules to maintain performance. Conversely, the KT1.2 indicator, which states that
leaders who implement punishment will be recognized for their leadership, received the lowest
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score. This suggests that a firm leader is unnecessary for team performance. It advises leaders to
maintain their current attitudes, as employees feel satisfied and can see their performance. For the
co-worker dimension, the KT2.1 indicator, which states that good human relations within the
agency create employee discipline, received the highest score. This positive value for management
suggests that socialization, such as company gatherings, can increase team performance. The
lowest score was in the KT2.2 indicator, which states that employees feel uncomfortable being
paired with anyone in the workgroup. The researcher recommends that leaders or management
pay more attention to team formation, as forcing employees to work together can decrease team
performance and impact the company.
The research findings indicate that implementing managerial recommendations can make a
practical contribution to the management of PT DTI. The study revealed that leadership and
teamwork significantly impact performance, as seen in partial and simultaneous tests. However,
the turnover variable does not affect team performance. The researcher suggests that PT. DTI
management maintains its leadership practices to prevent similar problems and ensure continued
learning from past issues. The lowest score was on the indicator (K1.3), indicating that
management does not recognize employee achievements. The researcher suggests that
management gives more appreciation to employee performance. The highest value was on the
indicator (K2.1), indicating that providing clear direction can improve team performance. The
researcher suggests that management always provides clear directions for continued success. The
lowest value of the indicator (K2.4) showed that management does not consider different solutions.
The researcher suggests that management be more innovative and listen to suggestions from
colleagues.
Regarding teamwork, the dimension of interacting with teammates received the highest score in
the indicator (TW 1.2), stating that team members contributed to each other's energy and thoughts.
This shows that group members work together, and it is recommended to maintain this aspect to
ensure the team's continued performance. On the other hand, the indicator (TW 1.5) received the
lowest score, wherein the statement suggests that one team member always takes over the group's
leadership. The research results indicate that PT Dreamaxtion Teknologi Internasional's team
performance is good because no one dominates the group, avoiding arguments. In conflict
management, the highest score was received by the indicator (TW 2.5), stating that the team looks
for solutions together in every problem. It is recommended to continue forming a healthy team by
management. Meanwhile, the lowest scores were received by indicators (TW 2.3 and TW 2.4),
stating that team members need a good leader to mediate problems and make decisions about
future solutions.
Regarding job embeddedness, turnover received the highest score in the dimension (TO 1.1),
stating that an employee may leave the company if offered a higher salary elsewhere. The research
suggests that employees will be loyal if their income or benefits meet their expectations.
Management may negotiate compensation or create a pleasant work environment to improve team
performance. Meanwhile, the lowest score was received by the indicator (TO 1.5), stating that the
company may be somewhere other than where the employee achieves their career goals. The
research indicates good career prospects, and providing feedback or appreciation to employees is
recommended. The highest score in the commitment dimension was received by the indicator (TO
2.5), stating that employees feel that the company has done a lot for their lives. This can be a threat
or an advantage, and it is suggested that management provide appropriate feedback to encourage
sincere employee work. Meanwhile, the lowest score was received by the statement (TO 2.4),
stating that employees find it difficult to leave the company for fear of not finding job opportunities
elsewhere. The researchers suggest sharing connections or inviting employees to collaborate with
other companies.
6. Conclusion
This study investigates the impact of leadership and teamwork on team performance and whether
turnover affects team performance. The research involved distributing questionnaires to 60
individuals who met specific criteria, and the data collected was analyzed using the statistical
analysis software SPSS 20.0. The findings indicate that both leadership and teamwork have a
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significant impact on team performance. Additionally, it was found that turnover does not affect
team performance.
This research focuses solely on leadership, teamwork, turnover, and team performance variables.
Therefore, it can only be applied to some situations as many other factors can impact it. Future
researchers will use different software to analyze the results and determine if they align with the
findings of this study. This model can also be utilized in other analytical units and management
areas. Future studies could benefit from examining a larger population, such as companies in the
enterprise stage, to provide more comprehensive and varied results for each variable. Additionally,
distributing questionnaires to more respondents will result in a more thorough analysis and aid
management decision-making.
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