Identity leadership increases organizational commitment

Employee loyalty in the traditional sense is losing ground. Organizational commitment, based on social exchange, is not strong enough to create attachment within work relationships in today’s changing nature of work. This is one of the conclusions from Dr. Ali Fenwick’s dissertation titled ‘Creating a Committed Workforce: Using Social Exchange and Social Identity to Enhance Psychological Attachment within an Ever-changing Workplace’, for which he received his doctorate from Nyenrode Business Universiteit on December 12, 2018.

Dr. Fenwick’s research uncovers a psychological mechanism that increases organizational commitment: social identity. Social identity helps develop a cognitive form of attachment, which results in a sense of belongingness and commitment. Dr. Fenwick claims that ‘organizational identification helps build a more resilient form of organizational commitment, which improves employee retention and performance’.

An end to loyalty, but not to commitment

Most organizational commitment models were developed about 30 years ago. The traditional model to enhance employee loyalty towards the organization is based on a social exchange relationship, reflecting promises of job security in exchange for employee effort and commitment. This is done through the provisioning of transactional (e.g. salary, benefits) and social (e.g. recognition, support, trust) commodities. This is still the foundation upon which most (HR) managers today seek to enhance organizational commitment and employee performance.

According to Dr. Fenwick, ‘Due to dynamic market forces affecting the labor market and the increase of remote work setups, it is becoming increasingly difficult to guarantee a balanced work relationship based on social exchanges alone.’ Dr. Fenwick concludes that there is an end to loyalty as we once knew it, which is why new approaches to enhancing employee attachment to organizations are required.

New attachment mechanism: social identity

Research shows that highly identified employees are able to better deal with uncertain situations, are more intrinsically motivated to pursue organizational goals and have a better understanding of what is happening in the organization. Dr. Fenwick’s research has uncovered an attachment mechanism to create a more durable form of organizational commitment: social identity. Identifying with organizational characteristics such as values, norms, ideology and management styles, enhance an employee’s sense of pride and belongingness.

This process of identification allows for the incorporation of organizational characteristics into one’s identity and aligns individual behaviors with group norms. Dr. Fenwick explains: ‘organizational membership is the process through which employees shape their own identity. The more an employee identifies with the organization, the more influence the organization has over the employee and the attachment an employee feels towards the organization.’

Core values, shared goals, purpose and meaningful work are therefore important organizational tools to use to connect and engage employees. Dr. Fenwick: ‘Social identity helps to connect people in organizations – even when employees don’t work in the same location – and helps direct behavior in a common direction.’

He therefore concludes that ‘social exchange and social identity factors together enhance organizational commitment in today’s dynamic working environment.’ His research has resulted in the development of a new model of organizational commitment.

Scientific contribution to commitment potential

Dr. Fenwick’s research provides scientific evidence how to psychologically attach employees in a dynamic work environment. He concludes that ‘organizations who effectively apply identity leadership throughout the whole talent management cycle will be in a better position to strategically drive performance. This not only contributes to the value creation process and effectiveness of the organization, but also helps achieve a firm-level competitive advantage.’

The dissertation provides HR managers and organizational leaders valuable insights and tools on how to improve organizational commitment and employee engagement in a rapidly changing business environment.