International Journal of Organizational Leadership

Abstract

The trends in the business world such as the transition to a service-based economy and the development of ICTs have significantly increased the importance of relationship-based loyalty for firms. In line with these changes, a long-term relationship with the customer has become a vital strategy in banking industry. The purpose of this paper is to show the role of organizational leadership in customer loyalty by examining the association between managing conflict, relationship quality and customer loyalty in banking services. In this respect, Agriculture bank of Iran was selected as the target population of the suggested theoretical model of this study and 417 customers of the bank have participated as the statistical samples to achieve the goals of this paper. Samples were selected using simple random sampling and research hypotheses were tested using structural modeling technique and AMOS software. The results showed that the managing conflict has an indirect and positive effect on customer loyalty through relationship quality. Furthermore, the managing conflict had a direct and positive effect on Trust, commitment, and customer satisfaction. In addition, an increase in trust, commitment and customer satisfaction with the bank led to increases in customer loyalty. Findings revealed that the organizational leadership by managing conflict between employees and customers can improve the quality of the customer-company relationship and lead to customer loyalty.