The Effect of Leadership on Employee Loyalty and Organizational Trust As Mediation Variables

Abstract

Leadership is an important factor in an organization's work in keeping the organization running to achieve its goals. In an effort to increase employee loyalty, every organization needs to test the level of organizational trust. This study aims to determine the effect of leadership on employee loyalty, and organizational trust as a mediating variable. The sample in this research is all employees in the regional secretariat office of Wakatobi Regency. The sample in this study used convenience sampling with a total sample of 250. The data analysis method used in this study was structural equation modeling (SEM) using Amos version 24. The results of this study indicate that leadership has a negative effect on employee loyalty on the probability value of the test results which are above 5% 0.805 and the critical ratio (CR) test results -0.247. shows that leadership has a positive effect on organizational trust, the probability value of the test results is (0%) and the critical ratio (CR) is 7.964. shows that organizational trust has a positive effect on employee loyalty on the probability value of (0%) and the critical ratio (CR) of 5.896. the mediation variable above shows that there is an indirect variable influence with a coefficient of 0.05 and the estimated standard inderct effect value of 0.867

The effect of leadership and teamwork on employee loyalty and organizational trust as a mediating variable

“…Organizational trust may be defined simply as the staff's trust in the decisions made by the corporation. This might refer to trust in management or specific team members, but it also includes organisational aspects like the company's mission, the purpose of senior leadership and the principles and culture of the company (Sudiarditha et al, 2022). Whereas, employee loyalty refers to as the employees who are dedicated to the success of their company and think that working there is in their best interests are said to be loyal to it.…”

“…One of the key factors in an organization's development is organisational trust (Hong-Cheng et al, 2021). This is because it fosters organisational stability, customer satisfaction, helps to lessen negative confrontations, and improves effective problem-solving solutions (Sudiarditha et al, 2022). Trust inside a company benefits both the organisation and the personnel in a variety of ways.…”

“…Dependence on others helps people to cooperate and get along with others(He et al, 2022).One of the key factors in an organization's development is organisational trust(Hong- Cheng et al, 2021). This is due to the fact that it promotes organisational stability, customer satisfaction, and aids in reducing unpleasant confrontations, and enhances efficient problem-solving techniques(Sudiarditha et al, 2022). There are many ways that trust inside a corporation is advantageous to both the organisation and the staff.…”