Servant Leadership Style and High-Performance Work System Practices: Pathway to a Sustainable Jordanian Airline Industry

Abstract

The purpose of this study is to examine how servant leadership (SL) and high-performance work systems (HPWS) practices enable organizational performance, as shown by employee retention and employee satisfaction. Data was obtained from 300 full time employees in a private airline company in Jordan. The data was collected in three rounds, each separated by one-week time-lag. Structural equation modeling was used to test the proposed relationships and revealed that both servant leadership and HPWS practices were positively linked with employee satisfaction and retention, which were used as indicators of organizational sustainability. In order to understand how servant leadership and HPWS influence employee satisfaction and retention, we investigated the mediating role of employee engagement and discovered that it serves as a critical mechanism. The study affirmed that, in line with studies carried out in the west, servant leadership is also an effective leadership characteristic in the context of Jordan. Furthermore, the study helps to clarify the reason that servant leadership and HPWS lead to positive outcomes, due to the fact that these improve the engagement of employees. Thus, we understand that the increases in employee retention and satisfaction are due to the enhanced engagement of employees, and we show that engagement can be improved both by servant leadership and the application of HPWS in organizations. Consequently, the effectiveness and sustainability of the airline companies in Jordan will need to focus on primarily improving employee engagement.

1. Introduction

Servant leaders provide leadership with an emphasis on serving the goals of the group; the leadership is more based on enabling followers and is not seen a status symbol. This is a vital leadership style in any organization, focusing on empowering subordinates for organization sustainability, developing communication between subordinates and management, and serving the desires of followers [1,2,3]. According to Bass [4] servant leadership plays a primary role in fulfilling follower needs so that they can reach the common goals. Servant leadership focuses on effective relationships between the leader and the subordinates, which reflects on the sustainability and success of organization [5]. In their review of the servant leadership literature, Parris and Peachey [6] state that although there is an agreement that servant leadership is an important leadership theory and is related to both organizational effectiveness and individual well-being, a consensus still has not been reached on its definition. Other reviews have argued that a common theme of the various definitions of servant leadership is ‘selfless service’ [7].

According to Eccles, Ioannou and Serafeim, [8], sustainability in the organization requires not only considering the short-term gains, but also taking the long-term contribution into account. Servant leadership is believed to have a significant contribution to organizational sustainability and the increased personal growth of followers [2,9]. Kumar [7] reports that servant leadership can be seen as a milestone in value based ethical leadership, and that it contributes to a more sustainable vision for organizations. In the same view, Lee and Ha-Brookshire [10] highlighted the need to achieve organizational sustainability in the fashion retail industry in the USA by demonstrating the role of leadership in changing employee attitudes and reducing their turnover intentions. Recently, Tarkang and Ozturen [11] investigated the influence of ethical leadership as a yard stick to produce sustainable employee outcomes in the hotel industry in Cameroon. Kang [12], added to the existing literature by investigating managers’ sustainable ethical leadership and its influence on employees work performance in South Korea. Similarly, servant leadership, with its focus on enabling employee achievements, and playing a supportive role to leaders, leads to sustainable organizational performance and not just short-term achievements through opportunistic tactics. Organizations should be able to retain their employees and keep them satisfied in order to be sustainable. Having a workforce with high turnover will result in employees who are less committed to the mission of the organization. The result of constantly changing employees is a psychological contract that is more transactional and less relational. Therefore, the employees have less interest in the sustainable mission of the organization and are more interested in the transaction based psychological contract, which simply says that employees give their time and effort and receive their pay in return.

Some studies have addressed the relationship between servant leadership and organizational performance. According to Dierendonck and Cropanzano [13], it is the responsibility of the servant leaders to meet the needs and interests of those who follow them before their own interests. The characteristics of this type of leadership have been associated with many different outcomes: job performance, help, organizational commitment, citizenship behavior, and engagement [14,15,16]. Additionally, servant leadership has been linked to several variables in the extant literature; Carter and Baghurst [14], and De Clercq et al. [17], highlighted the positive role of servant leaders in enhancing employee engagement. The role of servant leadership as a vital predictor of organizational performance in the service sector has also been reported. For example, Huang et al. [18] suggested that servant leadership is an important factor influencing hotel performance. Harwiki [19] considers servant leadership as a tool to enhance employee commitment and performance. However, more empirical research is needed to explore the mechanism through which servant leadership is related to these outcomes. By understanding the way servant leadership influences these outcomes, we can not only contribute to the servant leadership theory but also improve its application in a variety of settings. In particular, there is a is a gap in the literature about how servant leadership in the services sector can contribute to organizational sustainability, as indicated by employee retention and satisfaction.

Since servant leadership is based on the idea that leaders should first have the desire to help, thus provide leadership with the intention to serve the needs of the group, it may be perceived differently by societies with differing value systems. Thus, there is a need to assess whether the effect of servant leadership may differ from one culture to another [20,21]. Jordan, as an Arabic society, is characterized by high collectivism and a high power distance. Studies in settings with similar cultural values, such as Oman, have shown that employees consider their leaders to have moderate levels of servant leadership [20]. However, there is also evidence from studies conducted in Turkey, another collectivist culture with a high power distance, that as servant leadership increases, the performance of the staff increases [22].

Taking employee retention and satisfaction levels as proxies to indicate organizational sustainability, this paper aims: to examine the effects of servant leadership on organizational sustainability [23]; to examine the relationship between high-performance work systems (HPWS) practices and organizational sustainability; and to examine how employee engagement may act as a mediator in the relationships of servant leadership and HPWS practices with organizational sustainability. This paper also aims to assess the magnitude of servant leadership (SL) and HPWS impacts on organizational sustainability, and investigate the mechanism through which SL and HPWS operate to improve organizational sustainability, to be able to contribute to the theoretical discussion in the SL and HPWS fields.

2. The Tourism Industry in Jordan

Jordan is one of the Arab countries in the southwest of Asia. It is a small country with limited natural resources, and its land mass is covered by dessert. People in Jordan speak Arabic as the official language, and the majority are Muslim. The population of Jordan is slightly over 10 million as of the year 2017. Arabs constitute 95% of the Jordanian population and the remaining are Circassians, Chechens, and Armenians. Jordan is a very attractive place for foreign investments due to political stability, safety, and a central location within the Middle East [24].

Tourism is one of the largest contributors to Jordan’s gross domestic product and one of its largest foreign currency earners. According to the report of the Central Bank of Jordanian tourism, revenue reached $2.55 billion in 2013 [25,26]. Competition in tourism is relatively open and based on the underlying price and quality of services [27]. The increase in the number of recent studies in the literature on tourism in Jordan has attracted several questions [28]. Moreover, both local and international tourism in Jordan significantly contributes to the national income. Transportation advancement plays a crucial role in tourism’s development and sustainability in Jordan and the whole world [29]. Transportation is one of the most important factors in the developing tourism industry and for ensuring sustainability, thus the efficiency and performance of the airline sector is a critical component of the tourism industry of Jordan.

3. Theoretical Background and Hypotheses Development

3.1. The Relationship between Servant Leadership, and Employee Satisfaction and Retention

The concept of servant leadership, even if it was not labelled as such, dates back several centuries [30]. Greenleaf [31] (p. 29) defined servant leaders as “servant first” and described the process as beginning “with the natural feeling that one wants to serve, and then the conscious choice brings one to aspire to lead.” Servant leadership positively and significantly contributes to organizational success and increases followers’ personal growth [2,9]. In empirical studies, it has a significant impact on organizations’ performances; for instance, Jones [32] found a positive relationship between servant leadership and organizations’ performances. Baykal at al. [33] and Peterson et al. [34] also showed that servant leadership was of paramount importance to improving an organization and argued it was essential to organizational sustainability [12]. Moreover, studies have revealed the significant effects of servant leadership on individual performance levels. For example, Donia et al. [35] found that it enhanced the level of satisfaction among supervisors in a service industry (communication and banking) organization in Pakistan. Additionally, Sepahvand et al. [36] and Rozika et al. [37] indicate that it is related to satisfaction. Moreover, Hunter et al. [38] and Jaramillo et al. [39] reported that it is positively related to a reduced employee turnover intention rate, and Wong et al. [40] and Brohi et al. [41] showed that it is positively associated with retention. Taking into consideration the high value placed on serving others in the cultural context of Jordan, we expect that employees will be more satisfied and more likely to stay with their organization if they see that their leaders are interested in the benefits of the group more than their own leadership status. This interest will result in the sustainability of the organization. Thus, the study proposed the following hypotheses:

Hypothesis 1a (H1a).

Servant leadership has a positive effect on employee satisfaction;

Hypothesis 1b (H1b).

Servant leadership has a positive effect on employee retention.

3.2. The Relationship between HPWS, and Employee Satisfaction and Retention

The increasing popularity of HPWS can be attributed to the recognition of people as the most important source of competitive advantage [42,43,44], and the most critical aspect of human effort is to achieve sustainable results [23]. This study uses the term HPWS [45], but the concept has also been discussed by several authors using terms ranging from [46], high-performance work practices [47], high commitment work systems [48], high-performance human resource management [49], and system human resource management [50]. Scholars define HPWS as a mixture of HR practices that improve employee skills and motivations, impacting employee attitudes and outcomes [51,52]. Thus, HPWS is “designed to enhance employees’ skills, commitment, and productivity in such a way that employees become a source of sustainable competitive advantage” which aids in organizational sustainability [42] (p. 138).

The relationship between HPWS practices and organizational performance can be developed via the precepts of resource-based view (RBV) theory. Specifically, RBV theory proposes that organizations must identify and utilize their unique resources that are not easily imitated by the competition and use these resources as their competitive advantage. HPWS helps to identify and invest in the human capital and helps to achieve higher levels of organizational performance [53]. Previous empirical studies on HPWS and its impact on organizational performance can be classified into three categories. The first category shows how the HPWS practices as a bundle have an impact on overall organizational performance [49,54,55]. The second category of studies reveals the influence of individual HPWS practices, such as recruitment and selection [56,57], training and development [58,59], compensation and rewards [60,61], and performance appraisal [62] on organizational performance. The third category of studies shows the effects of HPWS practices on certain indicators of organizational performance, such as job satisfaction [63,64,65], employee engagement [66,67,68], and employee retention [69,70].

A study of a power company in India, Muduli [71] demonstrated the positive associations between six HPWS practices (i.e., staffing, compensation, flexible job assignments, teamwork, training, and communication) and organizational performance. Jyoti and Rani [45] also noted that HPWS fostered organizational performance by providing a good working environment for both the employees and the community in a telecommunication organization. Based on their results, Katou and Budhwar [72] advocated a positive influence of HPWS practices on organizational performance through recruitment, training, promotion, incentives, benefits, involvement, health, and safety. Additionally, in a study of employees working in the hotel sector in India, Chand, and Katou [73] claimed that recruitment and selection, manpower planning, job design, training and development, quality circles, and pay systems were positively associated with better hotel performance.

In the same vein, there is evidence that HPWS influences employee satisfaction: García-Chas et al. [65] showed that HPWS was of paramount importance for improving satisfaction in a variety of sectors in Spain. Another influential role of HPWS is to help employees solve problems they face in their jobs and gain new knowledge to increase productivity [45]. Consistent with this role, Haider et al. [74] stated that HPWS practices support employee retention. Similarly, Azeez [75] indicated that HPWS practices, such as leadership, rewards, salary, compensation, training and development, career development, and recognition are influential for job satisfaction and lower turnover. Hong et al. [76] stressed that HPWS practices, namely training and development, appraisal systems, and compensation, positively affect retention. With an economy open to competition, airlines in Jordan need to utilize their human resources in the best way in order to develop a competitive advantage. Based on the above arguments, the following hypotheses are proposed:

Hypothesis 2a (H2a).

The HPWS practices of selection and recruitment, training and development, performance appraisals, and compensation, have positive effects on employee satisfaction.

Hypothesis 2b (H2b).

The HPWS practices of selection and recruitment, training and development, performance appraisals, and compensation, have positive effects on employee retention.

3.3. The Relationship between Employee Engagement, and Employee Satisfaction and Retention

Employee engagement has also been discussed [77], said to include work engagement [78] and personal engagement [79], and is seen as a critical factor in many employee outcomes. Robinson et al. [80] described employee engagement as a positive employee attitude on the job that creates commitment to the organization and leads to improved organizational performance and effective achievement of the organization’s goals [81]. Karatepe [78], Harter et al. [82], and Saks [52] also contended that engagement plays a vital role in improving organizational performance. According to Truss et al. [83] and Kaliannan and Adjovu [84], employee engagement supports organizational success by enhancing competitive advantage. Studies have also provided evidence that employee engagement enhances organizational performance. For example, Demerouti and Cropanzano [13] demonstrated that employee engagement positively influences organizational performance. Furthermore, Baumruk [85] indicated that employee engagement promotes teamwork and job sharing, leading to attainment of the organization’s goals and sustainability. In a study of employees in the hotel sector, Kim and Koo [86] found that engagement fostered organizational performance. Some empirical studies have found significant relationships of engagement with satisfaction and retention, as measures of individual performance. For example, Alarcon and Lyons [87], Rayton and Yalabik [88] reported that employee engagement positively influences employee satisfaction. Moreover, Bhatnagar [89] showed that employee engagement increased retention in an information technology enabled service (ITES) organization in India. More recently, Kundu and Lata [90] reported that employee engagement enhances retention in both public and private sector organizations. Given these findings, the following hypotheses are proposed:

Hypothesis 3a (H3a).

Employee engagement has a positive effect on employee satisfaction;

Hypothesis 3b (H3b).

Employee engagement has a positive effect on employee retention.

3.4. Employee Engagement as a Mediator between HPWS Practices, and Employee Satisfaction and Retention

Social exchange theory (SET) argues that individuals assess what they give and what they receive in a relationship and they are satisfied if they perceive that there is a fair exchange. Thus, it serves as a viable theoretical framework to examine how HPWS practices and organizational performance are related [91]. The employees perceive the high-performance practices—such as training—as investment in their skills, and the performance appraisal and rewards systems as recognition for their achievements. The employees also consider the recruitment and selection systems as the importance the organization places on them. Thus, they feel that the relationship that they have with the organization is not merely a simple transaction but a fair social exchange that is based on an ongoing relationship [91]. Therefore, the HPWS practices play a vital role in improving the level organizational performance through the increased employee engagement with the organization. For example, the level of employee engagement with organization increases by providing training programs to improve employees’ skills and knowledge that positively affect their performance. According to Zacharatos et al. [92], the main purpose of HPWS is to engage employees in decision making by empowering them in an organization that enhances employee trust and efficiency.

Considering the relationship between HPWS practices and employee engagement, a number of empirical studies have asserted a link between these constructs. For example, Davies et al. [93] indicated that HPWS practices, such as training and development, influence employee engagement. Karatepe [78] showed that training, empowerment, and reward systems boosted engagement among employees in the hotel sector. Presbitero [68] found that HPWS practices, such as training and development, and rewards, positively influenced engagement in the Philippines’ hotel sector. In concordance with these findings, Ling Suan et al. [94] showed that training and performance appraisals enhanced employee engagement in the Malaysian hotel sector. In addition, Juhdi et al. [95] reported that HPWS practices, such as compensation, rewards, development opportunities, career management, personal–job fit, and job control positively influenced employee engagement. Furthermore, Babakus et al. [96] demonstrated that training, empowerment, and rewards improved work engagement and reduced turnover intentions, leading to the following hypothesis:

Hypothesis 4 (H4).

The HPWS practices of selection and recruitment, training and development, performance appraisals, and compensation have positive effects on employee engagement.

There is evidence that employee engagement plays a mediating role in multiple relationships. For example, Schaufeli and Salanova [97] reported that engagement fully mediates the effect of job resources on proactive behavior. Similarly, in a study of the banking sector in the UK, Yalabik et al. [98] showed that it plays a mediating role in the relationship between job satisfaction and employee performance. Moreover, Karatepe and Aga [99] found that employee engagement fully mediates the relationships of organizational mission fulfillment and perceived organizational support with job performance, among frontline employees in banks in Northern Cyprus. Moreover, empirical research has revealed that engagement plays a mediating role between HPWS practices and organizational performance. For example, Karatepe and Olugbade [67] contended that HPWS practices, such as selective staffing, job security, teamwork, and career opportunities, impact job outcomes through employee engagement. Similarly, Karatepe [78] found that engagement (i.e., vigor, dedication, and absorption) fully mediates the relationship between HPWS practices (i.e., training, empowerment, and rewards) and job and extra-role performance.

Based on the social exchange theory, the HPWS will help create higher levels of engagement by developing a relationship that employees will wish to sustain with the organization due to the perception of a fair relationship. In line with the empirical evidence provided above, we expect that this increased level of employee engagement leads to improved employee satisfaction and retention.

Consequently, the present study proposes that employee engagement is a mediator between HPWS practices (selection and recruitment, training and development, performance appraisal, and compensation) and organizational performance (employee satisfaction and employee retention), leading to the following hypotheses:

Hypothesis 5a (H5a).

Employee engagement (EE) mediates the effects of HPWS practices on employee satisfaction.

Hypothesis 5b (H5b).

EE mediates the effects of HPWS practices on employee retention.

3.5. Employee Engagement as a Mediator between Servant Leadership and Organizational Performance

On the basis of leader–member exchange (LMX) theory, since a servant leader seeks to meet employee needs and provide a safe environment, their employees will exhibit higher levels of work engagement, leading to the success of the organization [31,79]. Servant leaders’ attention to employee needs and resource development can increase employee engagement [82]. According to Van Dierendonck [100], servant leadership is related to improving the employee outcomes, because the servant leaders invest the time to learn about their followers’ unique characteristics and help to develop them. Within the same scope, Carter et al [14] and De Clercq et al [17] highlight the positive role of servant leadership on engagement. According to Kell [101], serving the employee selflessly is one of the most important characteristics of servant leaders that results in employees’ feeling safe, thus engaging them with organization [79]. An additional supporting view is suggested by Wong et al. [40] and Macey and Schneider [102], who see leadership as one of the biggest factors that influences engagement in the workplace. Karatepe and Talebzadeh [103] showed that SL played a vital role in enhancing employee engagement in an airline in Iran. De Clercq et al. [17] indicated a significant impact of SL on EE in an information technology organization in Ukraine. Although there are some studies have shown that servant leadership can be a vital predictor of engagement in the service industry, empirical studies focusing on the relationship between servant leadership and employee engagement in the service sector are inadequate [14]. Based on the discussion above we expect:

Hypothesis 6 (H6).

Servant leadership has a positive effect on employee engagement.

Studies have also revealed that servant leadership significantly influences individual performance levels, such as employee satisfaction and retention. In a study of university employees, Chain, Ding et al. [104] found that servant leadership fostered satisfaction and employee loyalty. Hunter et al. [38] also provided empirical results for the relationship between servant leadership and employee turnover intentions. Additionally, Wong et al. [40] and Kaur [105] showed that servant leadership is positively associated with retention.

We believe that the reason for this relationship between servant leadership and employee outcomes is higher levels of employee engagement. As discussed above, servant leaders create relationships that increase the engagement of employees, and it is this improved engagement that leads to the satisfaction and retention of employees.

However, no empirical research has measured the mediating role of employee engagement in the relationships of servant leadership with employee satisfaction and retention. Thus, the following hypotheses are proposed:

Hypothesis 7a (H7a).

Employee engagement mediates the effects of servant leadership on employee satisfaction;

Hypothesis 7b (H7b).

Employee engagement mediates the effects of servant leadership on employee retention.

The conceptual model is shown in Figure 1. The model suggests that HPWS practices are directly linked to employee engagement. In addition, the model shows that employee engagement enhance organizational performance. The researcher proposed that employee engagement the effect of HPWS practices and servant leadership on organizational performance.

4. Research Methodology

4.1. Data Collection

The context of this study is the airline sector in the Hashemite Kingdom of Jordan, which is comprised of eight airlines (3 public and 5 private). Information and necessary permissions were obtained from the Jordan Civil Aviation Organization at the time of the study. The participants in the current study were employees working in the private airline sector in Jordan. Questionnaires were distributed to 300 employees and 277 responses were returned. There were 23 questionnaires where 50% of the items had missing responses and these were excluded from the analysis. The response rate was 92%. The current study used the judgmental sampling technique; according to Karatepe [78], this technique allows the researcher to choose the participants based on particular standards, which are presupposed to be representative of the population. The particular standards in this study were being a full-time employee in the airline sector. Based on that, the data were collected from the full-time employees (e.g., those in check-in, transit check-in, and baggage service) in private airlines in Jordan. To decrease the common method bias [78], the questionnaires were distributed within a time lag of one week in between the three rounds. The responses of the same respondents were matched in the three rounds using code numbered questionnaires. The nature of the airline industry that uses the same crews in different shifts allowed the questionnaire to be collected from same respondents in different rounds. The questions about employees’ perceptions of the servant leadership of their immediate supervisor and their view of HPWS implemented in their workplace were collected in the first round of the data collection; employees’ responses to their level of engagement were collected in the second round; and employee satisfaction and employee retention responses were collected in the third round. The responses to leader and administrative system questions, engagement questions, and the employee outcome questions were collected in the different rounds in order place some temporal space between them and reduce bias that could arise from prior items and responses in the questionnaire.

4.2. Measurement Scales

Twenty-one items developed by Amin et al. [106] were adopted for measuring HPWS practices. Selection methods were measured with 4 items, such as, “Valid and standardized tests are used when required in the selection process;” training and development methods were measured with 6 items, such as, “Training needs identified are realistic, useful, and based on business strategy;” performance appraisal was measured with 6 items, such as, “Performance evaluation is considered an important task;” and 5 items were used to measure compensation and rewards, such as, “Salary is comparable to others in the market.” All the items were rated on a 5-point scale ranging from strongly agree (5) to strongly disagree (1).

Servant leadership was measure using five items adapted from Otero-Neira et al. [107]. A sample item was, “My supervisor works hard at finding ways to help others be the best they can be.” All the items were rated on a 5-point scale ranging from strongly agree (5) to strongly disagree (1).

Employee satisfaction was measured with seven items from Barakat et al. [108] and eight items adapted from Kundu et al. [90] were used to measure employee retention. A sample item for satisfaction is, “I like the work I currently do in this company,” and “I am likely to stay in this organization for next five years,” for employee retention. All the items were rated on a 5-point scale ranging from strongly agree (5) to strongly disagree (1).

Employee engagement was measured by three indicators: vigor, dedication, and absorption, using fifteen items adapted from Schaufeli et al. [109]. Sample items for vigor, dedication and absorption were, “At my work, I feel bursting with energy,” “I find the work that I do full of meaning and purpose,” and “Time flies when I am working,” respectively. The responses to the items were rated on a 7-point frequency rating ranging from always (7) to never (1). The questionnaire exists in Appendix A.

5. Results

5.1. Sample Characteristics

Table 1. Participant profiles.

Items	Frequency	Percentage
Gender
Male	168	60.6
Female	108	39.4
Age
18–27	95	34.3
28–37	116	41.9
38–47	53	19.1
47–above	13	4.7
Education level
Two-year college	105	37.9
Four-year	149	53.8
Graduate	23	8.3
Position of the job
Manager	19	6.9
Assistant	49	17.7
Employee	108	75.4
Type of the job
Check-in	80	28.9
Transit check-in	45	16.2
Baggage service	43	15.5
Other	108	39.4

shows the profile of the participants. The number of male respondents was 168 (60.6%), and the females numbered 108 (39.4%). Regarding the participants’ age, the highest percentage was (41.9%) between 28 and 37, while the percentage those of the ages 18 to 27 was 34.3%, and for the ages 38 to 47, was 19.1%. The rest were 48 and above. In terms of the educational level, the percentage of a four-year education was 53.8%, and of the two-year colleges was 37.9%; the remaining 8.3% was the percentage of graduate participants. Considering the participants’ position, the percentage of manager respondents was 6.9% and assistant manager was 17.7%. The rest were regular employees. Percentages of respondents working in the check-in, transit check-in, and baggage service were 28.9%, 16.2%, 15.5% respectively. The remaining 39.4% was assigned to other duties.

5.2. Reliability Scale

Table 2. Scale items and confirmatory factor analysis (CFA) results.

Scale Items	Loading	Alpha	AVE	CR
Servant Leadership		0.92	0.64	0.94
-SL1	0.81
-SL2	0.8
-SL3	0.9
-SL4	0.82
-SL5	0.74
Employee Retention		0.71	0.53	0.94
-ER6	0.73
-ER7	0.62
-ER8	0.8
-ER9	0.7
-ER10	0.8
-ER11	0.7
-ER12	0.72
-ER13	0.8
Employee Satisfaction	0.84	0.53	0.86
-ES14	0.54
-ES15	***
-ES16	0.8
-ES17	0.62
-ES18	0.81
-ES19	0.8
-ES20	0.8
HPWS practices		0.91	0.5	0.94
-HPWS21	***
-HPWS22	***
-HPWS23	0.62
-HPWS24	***
-HPWS25	0.7
-HPWS26	0.72
-HPWS27	0.73
-HPWS28	0.73
-HPWS29	0.75
-HPWS30	0.72
-HPWS31	0.71
-HPWS32	0.7
-HPWS33	0.7
-HPWS34	0.7
-HPWS35	0.61
-HPWS36	***
-HPWS37	0.7
-HPWS38	0.83
-HPWS39	0.73
-HPWS40	***
-HPWS41	0.6
Employee Engagement		0.91	0.54	0.9
-EE42	0.74
-EE43	0.8
-EE44	0.8
-EE45	0.7
-EE46	0.7
-EE47	***
-EE48	0.74
-EE49	0.8
-EE50	0.63
-EE51	0.8
-EE52	***
-EE53	***
-EE54	0.8
-EE55	0.8
-EE56	0.71
-EE57	0.8
-EE58	0.7

Note: *** cross-loading.

shows the results of the confirmatory factor analysis (CFA), Cronbach’s alpha, average variance extracted (AVE), and composite reliability (CR). Based on the CFA results, five items from HPWS, three items from employee engagement (EE), and one item from employee satisfaction (ES) were deleted because of cross-loading. The factor loads ranged from 0.60 to 0.90. Thus, all loadings were 0.60 or greater, indicating convergent validity [109,110]. As demonstrated (see Table 2), the values of Cronbach’s alpha were higher than 0.70, providing evidence of reliability [111]. The AVE values for servant leadership (SL), ES, ER, HPWS practices, and EE were 0.64, 0.53, 0.53, 0.50, and 0.54, respectively, and were greater than cut-off level, 0.50, supporting discriminant validity [110]. Moreover, the CR of each factor was higher than 0.60 [111].

Table 3. The means, standard deviations and correlations.

	Mean	SD	1	2	3	4	5
1. Servant Leadership	3.88	0.759	-
2. Employee Retention	3.71	0.475	0.503 **	-
3. Employee Satisfaction	4.05	0.769	0.538 **	0.461 **	-
4. HPWS Practices	3.9	0.701	0.547 **	0.463 **	0.571 **	-
5. Employee Engagement	5.71	0.934	0.475 **	0.437 **	0.520 **	0.425 **	-

Note: SD = standard deviation. ** Correlation are significant at the p < 0.01 level (two-tailed).

shows the means, standard deviations, and correlations for HPWS practices, EE, SL, ER, and ES. The results show that HPWS practices were significantly related to EE (r = 0.425, p < 0.05), ER (r = 0.463, p < 0.05), and ES (r = 0.571, p < 0.05). Positive associations were observed between EE and ER (r = 0.437, p < 0.001), and between EE and ES (r = 0.530, p < 0.001). SL was positively corelated to ER (r = 0.503, p < 0.001), whereas SL was positively corelated to EE (r = 0.538, p < 0.001). All correlation values were below the cut-off of 0.70.

5.3. Test of Hypothesized Model

As demonstrated (see

Table 4. Results of the social exchange theory (SEM) hypotheses.

Hypotheses Testing	Std. Est.	SE	CR	p	Results
H1a: Servant leadership→Employee Satisfaction	0.39	0.041	5.21	0.001	Supported
H1b: Servant leadership→Employee Retention	0.55	0.063	8.11	0.001	Supported
H2a: HPWS practices→Employee Satisfaction	0.36	0.045	3.69	0.001	Supported
H2b: HPWS practices→Employee Retention	0.56	0.08	6.16	0.001	Supported
H3a: Employee Engagement→Employee Satisfaction	0.31	0.076	2.69	0.007	Supported
H3b: Employee Engagement→Employee Retention	0.327	0.08	2.01	0.04	Supported
H4: HPWS practices→Employee Engagement	0.346	0.052	4.46	0.001	Supported
H6: Servant leadership→Employee Engagement	0.37	0.046	5.14	0.001	Supported

Note: Std. Est. = standardized estimate, SE = standard error, CR = critical ratio.

), the hypothesized model fit the data (χ² = 986.857, df = 478, χ²/df = 2.00, CFI = 0.902, RMSEA (Root mean square error of approximation) = 0.062, and SRMR = 0.065). The χ²/df value of 2.00 is less than three, indicating an acceptable fit. In addition, CFI was 0.902, which is greater than 0.90; values close to one indicate a good fit. Finally, the values of SRMR (Standardized root mean square residual) were both less than 0.08, indicating an acceptable fit.

Hypotheses H1a and H1b, which proposed that SL positively affects ES and ER, are supported by path coefficients of β = 0.389 (p < 0.001) and β = 0.550 (p < 0.001), respectively. Hypotheses H2a and H2b proposed that HPWS practices positively relate to ES and ER. The path coefficients were β = 0.361 (p < 0.001) and β = 0.560 (p < 0.001), thus supporting H2a and H2b, respectively. EE was positively associated with both ES (β = 0.310, p < 0.007) and ER (β = 0.327, p < 0.040), respectively. Therefore, H3a and H3b were supported. The results also indicated that HPWS practices positively relate to EE (β = 0.346, p < 0.001), supporting H4. SL was also positively affected EE (β = 0.370, p < 0.001), supporting H6. All values are shown in Figure 2.

The findings (see

Table 5. Path estimates of direct effect models.

	Standardized Regression Weights	p
Direct effect without mediation
HPWS practices→Employee Satisfaction	0.36	0.001
HPWS practices→Employee Retention	0.56	0.001
Servant leadership→Employee Satisfaction	0.39	0.001
Servant leadership→Employee Retention	0.55	0.001
Direct effect with mediation
HPWS practices→Employee Satisfaction	0.29	0.001
HPWS practices→Employee Retention	0.51	0.001
Servant leadership→Employee Satisfaction	0.32	0.001
Servant leadership→Employee Retention	0.5	0.001

) show the path estimates of the direct effect models. The results show the effect of HPWS practices on ES, which decreased from standardized estimate (Std.Est.) = 0.36 (p = 0.001) to Std.Est. = 0.29 (p = 0.001) when EE was added to the model. Thus, EE partially mediates the relationship between HPWS practices and ES. In addition, the effects of HPWS practices on ER decreased from Std.Est. = 0.56 (p = 0.001) to Std.Est. = 0.51 (p = 0.001) when EE entered the model.

Consequently, EE plays a partial mediating role in this relationship, supporting H6a and H6b. Furthermore, when EE entered the model, the impact of SL on ES was reduced from Std.Est. = 0.39 (p = 0.001) to Std.Est. = 0.32 (p = 0.001), and the effect of SL on ER was reduced from Std.Est. = 0.55 (p = 0.001) to Std.Est. = 0.50 (p = 0.001). Thus, EE plays a partial mediator role, and H7a and H7b are supported.

Additionally, mediation was confirmed by bootstrapping using 2000 resamples with 95% bias-corrected confidence intervals. The results (see

Table 6. Bootstrapping results of mediating of employee engagement.

Hypothesis	Direct Relationship	Mediation	Direct Effect	p	Indirect Effect	LLCI	ULCI	p
H4a	HPW and ES	EE	0.43	0.001	0.27	0.02	0.133	0.001
H4b	HPW and ER	EE	0.56	0.001	0.51	0.004	0.098	0.001
H7a	SL and ES	EE	0.39	0.001	0.22	0.018	0.125	0.001
H7b	SL and ER	EE	0.41	0.001	0.38	0.002	0.087	0.001

Note: bootstrapping by 2000 resamples with 95% bias-corrected confidence intervals was employed to test the significant of the indirect effect. LLCI = lower-level confidence intervals; ULCI = upper-level confidence intervals.

) show the direct effect of HPWS on ES (β = 0.43, p < 0.001); and the indirect effect that is from HPWS practices effect on the ES and is mediated by the EE is between 0.020 and 0.133, with a 95% bias corrected percentile method, using a bootstrapping method with 2000 resamples (β = 0.270, p < 0.001). In addition, it provides the direct effect of HPWS on ER (β = 0.56, p < 0.001); and the indirect effect that is from HPWS practices’ effect on ER via the EE is between 0.004 and 0.098, with a 95% bias corrected percentile method, using a bootstrapping method with 2000 resamples (β = 0.51, p < 0.001). This result provides the evidence that there is mediation. Therefore, H5a and H5b are supported. Additionally, the table shows the direct effect of SL on ES (β = 0.39, p < 0.001); and the indirect effect that is from SL’s interaction with ES, and mediated by the EE, is between 0.018 and 0.125, with a 95% bias corrected percentile method, using a bootstrapping method with 2000 resamples (β = 0.22, p < 0.001). In addition, it provides the direct effect of SL on ER (β = 0.41 p < 0.001); and the indirect effect that is from SL practices’ effect on ER via the EE is between 0.002 and 0.087, with a 95% bias corrected percentile method, using a bootstrapping method with 2000 resamples (β = 0.38, p < 0.001). This result proves that there is mediation. Therefore, H7a and H7b are supported.

6. Discussion and Implications

Our study examined how servant leadership and HPWS practices improve organizational performance. We reveal that increased employee engagement due to servant leadership and HPWS is part of the reason for the mechanism through which these factors lead to organizational performance. All hypotheses were supported by the data obtained from 277 employees working in private airlines in Jordan, indicating that servant leadership and HPWS lead to increased employee satisfaction and retention, and that the mechanism that enables this relationship is employee engagement.

As predicted, servant leadership strengthens employees and increases their satisfaction [5,112]. In prior research, that has been linked to sustainability [12]. The results of this study found that the airline employees in Jordan will be more satisfied and more likely to stay if they see that their leader is interested in the success of the group members more than his/her own status. This is expected to result in sustaining the organization in the longer term. Our results are consistent with Donia et al. [35], who also reported a positive impact of servant leadership on satisfaction, and Hunter et al. [38], who found a significant impact for servant leadership on retention. The unique contribution of our study is that our results not only show that servant leadership leads to satisfaction and retention, but also that this relationship is due to the increased employee engagement in the organization, when the leader is perceived to be a servant leader. The increased engagement is related to higher levels of satisfaction and retention. Therefore, our findings go beyond demonstrating the relationship between servant leadership and outcomes. It helps in explaining how this relationship occurs and the significance of these relationships on the organization.

There is evidence in extant literature of a link between HPWS, and retention and satisfaction. For example, Azeez [75] and García-Chas et al. [65] asserted that HPWS leads to significant results, such as satisfaction and retention of employees. Steijn [113] indicated that HPWS practices positively impact satisfaction in the public sector. Benish and Gulzar [114] found that HPWS practices have significant impacts on retention. Our results also confirm the findings of the prior research. Furthermore, we also investigated the mechanism that links HPWS to employee retention and satisfaction. Since sustainability of a service organization is dependent on the consistency of service delivery, the lower employee turnover levels will enhance organizational sustainability. Therefore, the study found out that HPWS improves satisfaction and retention, by improving employee engagement within the organization.

As hypothesized, employee engagement partially mediates the relationships of both servant leadership and HPWS practices with satisfaction and retention. The presence of servant leadership and HPWS practices improve engagement that in turn leads to higher levels of satisfaction and retention. Our results also agree with the finding of Karatepe and Olugbade [67], who found out that HPWS practices—such as selective staffing, job security, teamwork, and career opportunities—have a positive impact on work outcomes via engagement in the hotel sector. In summary, engagement acts as a partial mediator influencing servant leadership and HPWS’s effects on employee satisfaction and retention. Our study shows that engagement should be seen as a key issue in service organizations and that engagement can be improved by having fair policies that invest in employees, also by having leaders who care about the success of their employees in order to achieve organizational goals.

The current study has critical implications that can be effective for managers who have interests in improving their employees’ organizational performance, maintaining and sustaining the organization. The results of this study state that leaders can represent a motivating factor for their followers if those leaders can show that they understand their followers’ interests and can align the organizational goals to employee objectives. This can be done through many different procedures, such as improving the followers’ performance and engaging their workers in decision making. This study also highlights the importance of the sociability of the servant leaders to enhance the morale at work and increase the satisfaction of the employees. Thus, managers are advised to take servant leadership into consideration in order to improve the organizational effectiveness and sustainability. Moreover, the current study demonstrates that servant leadership helps to achieve better outcomes by increasing the engagement of employees. The success of servant leadership through leading to outcomes, depends on its ability to increase employee engagement. Thus, it is the management’s responsibility to provide a work environment with resources that facilitate the engagement of their followers, to act in a good manner, and to establish positive relationships with their followers [103]. We recommend managers to focus on the engagement of their employees, which can be partially achieved by using SL and HPWS, if they would like to achieve better outcomes.

Limitations and Future Research

Despite the robust contribution made by this study, especially in regard to the sustainability of the airline industry in Jordan, the limitations of the study are worth noting. This study has certain limitations and points to directions for future research. First, HPWS was manifested by selection and recruitment, training and development, performance appraisal, and compensation. There are other essential practices, such as work–life balance and rewards, that could be studied in the future. Second, collecting data from employees in a single sector (i.e., the airline sector) might limit the generalizability of the findings. Therefore, future studies may gather data from different service industries (e.g., hotels and banks) in different countries. In addition, the current study focused on the individual performance levels, such as satisfaction and retention. Therefore, future studies could assess the influence of HPWS practices on performance at the organizational level, such as financial performance. Additionally, this study investigated the study variables as though they were contributing to organizational sustainability; further studies could check the influence of organizational ethical practices and employee goals as influencers for sustainability.

7. Conclusions

Our findings can be interpreted by social exchange theory, as Takeuchi et al., [91] explains that HPWS helps the employees to feel that the organization places more importance on their talents, achievements, and development, with its HR policies and practices. In turn, they feel obliged to reciprocate by becoming more engaged, which leads to higher satisfaction levels and intentions to stay in the organization. Furthermore, we see that when the leadership acts as a facilitator and provides servant leadership practices, which focus on employee success, the employees feel that they should also give back to their leaders by embracing the values of the organization and remaining committed to the mission of sustainability. We also demonstrate that with the findings of this study, the way that HPWS and servant leadership can contribute to sustainable results is that they improve employee engagement. This understanding helps us to have a more focused approach in the management of human resources. Our leadership style and our human resource policies should strive to increase employee engagement. Our ability to enhance the satisfaction and retention is proportionate to the level of engagement we can create. Organizations should realize the critical role of employee engagement as a tool that leads to sustainability, and focus on improving it with an appropriate combination of leadership and HR policies.