impact of leadership styles on organizational performance

The leaders are strongly committed to their processes and procedures but not to their people. The author stated that an autocratic leader is the one who determines the activities, techniques and policies to the employees and expects the employees to follow the same. Choi (2007) also stated that a democratic leader is the one who focuses on the group discussion and group participation and as a result it positively influences the performance of the followers. As per the literature review, transformational leadership helps in establishing a value system along with providing the employees an opportunity to develop their skills and abilities. The continued success enjoyed by many organizations is derived from a balanced that are achieved in terms of goals of both the employees and the management of the organization through effective leadership. The transformational leadership style (β = 0.032; t= 0.276; P), democratic leadership style (β = 0.003; t= 0.09; P< 0.05) were independent predictors of organizational performance. ��`%�x(��������0�ŠH�I��\ � ~�e Γ�lM���,�1iB��0�Yo}�2 S҄�o�da*�!�zx�Pܕ"��?�u�!O�QԹ|�V��h]�%j�� ��P���I�X:>� �Ҷ�a���~i�{����w��E��x>����$G�������#��M�HQ�mf�����2-H�[�@�dͮh��Ѭ�w��&�_��6��;��@�Z�Oi�Z�I~�ePo�EF�c�Rr���@ŧlғď_��덵.u��g�gN;C1�R�� �B&a�xpt0e�*��uR��e5� 5U]�&ټ˛ڶ�I�Dm� ہ�z��o�w��e�6��CbXs�M8m3�2�W{��9t���J�D_��}�H6'�l��{�r9jqV��ڼ}�׽Pq�1`a3mپ�:�9��葤� Transactional leadership, Charismatic leadership, and bureaucratic leadership were found to have a negative relationship with the organizational performance with (r= -0.174, -0.432, -0.292; P<0.001) respectively. In addition such leaders do not have much faith on their followers. There is a considerable impact of the leadership styles on organizational performance. Sofi, M. A. Widely celebrated cases of a direct leadership–performance link may be found in numerous accounts of improvements of company’s performance attributed to changes in leadership (Nicholls, 1988; Simms, 1997). The role of leadership in an organization is crucial in terms of creating a vision, mission, determination and establishment of objectives, designing strategies, policies, and methods to achieve the organizational objectives effectively and efficiently along with directing and coordinating the efforts and organizational activities (Xu & Wang, 2008).Top quality leadership is essential to achieve the mission and vision along with coping with the changes occurring in the external environment (Harris, et al., 2007).In current time, many companies are facing problems related to unethical practices, high labor turnover, poor financial performance, etc. The study by Longe (2014) revealed that transactional leadership style has a positive impact on the organizational performance. Charismatic leadership style and organizational performance. They conducted a quantitative research on the employees of twenty banks based in Nigeria through a survey questionnaire. This study has provided deep insights about the leadership styles; the democratic, transformational, bureaucratic and autocratic leaderships have a positive impact on the organizational performance, however, the charismatic and transactional leaderships have negative impact on the organizational performance, as it does not provide opportunities and freedom to employees. Performance: The action or process of performing a task or function. Sougui, A. o., Bon, A. T. B. In order to determine the impact of the leadership style on organizational performance, the research hypothesis was formulated. & Sajuyigbe, A. S., 2012. The charismatic leadership invites innovation and creativity and is considered to be motivational for the employees. Igbaekemen and Odivwri (2015) also conducted a study on the impact of leadership styles on the performance of the organizations. The results in the table show that there is both a positive and a negative relationship between the selected dimensions of leadership and organizational performance. The finds of this study are in line with previous research studies (Wang, et al., 2010; Obiwuru, et al., 2011). ABSTRACT. This study aims to examine the impact of leadership style on organizational performance in selected Banks, in Lagos, Nigeria. endobj The charismatic leadership (β = -0.354; t = -2.432; P< 0.05), transactional leadership (β= -0.076; t = -0.272; P>0.05) and bureaucratic leadership (β = -0.453; t = -2.143; P < 0.05) have a negative effect on organizational performance. Unfortunately some organizations do not take cognizance of the leadership style adopted by their managers. In the autocratic leadership, employees have to work or follow the orders given by the leader and this works in favor of the organization as per the survey. Conceptually, it is argued that the visionary and inspirational skills of transformational leaders motivate followers to deliver superior performance (Nicholls, 1988; Quick, 1992). This leadership style particularly helps in creating an environment that is optimal for performance and also articulates the compelling vision that enhances the overall organizational performance (Longe, 2014). It is believed that an organization's kind of style of leadership influences its overall results. Hence, transactional leadership can be defined as the exchange of targets and rewards between the management and the employees (Ojokuku, et al., 2012). Leadership style is viewed as a combination of different characteristics, traits and behaviors that are used by leaders for interacting with their subordinates. The Cronbach’s alpha coefficient values for charismatic leadership, bureaucratic leadership, transformational leadership, transactional leadership, democratic leadership and autocratic leadership were found to be 0.813, 0.780, 0.087, 0.790, 0.753, and 0.650 respectively. & Nwankwere, I. It is important for a leadership style to offer opportunities to employees, offer a sense of belonging along with allowing them to participate in the decision -making. <> Relationship between Leadership Styles and Organizational Performance. The transformational leadership, according to Bass and Avolio (1994), occurs when the leaders broaden or elevate the interest of the employees. The study ranks the six leadership styles in terms of their positive impact on organisational climate, taking into account the climate drivers flexibility, responsibility, employee wellbeing, standards, leadership training, rewards, clarity and commitment. It does not motivate and induce the employees enough to retrieve the expected performances out of them (Ojokuku, et al., 2012). Copyright © 2020 IBIMA Publishing All rights reserved, The results show that transformational leadership, transactional leadership, democratic leadership and autocratic leadership styles predicted the organizational performance in a joint manner (F (5, 42) = 2.542; R. The results prove that the leadership styles contribute effectively in determining the organizational performance. According to Kumar (2005), when the goal of study is to find the relationship among variables, quantitative approach is usually utilized. The transformational, autocratic and democratic leadership styles were found to have a positive influence on organizational performance, whereas, the transactional, charismatic and bureaucratic leadership styles were found to have a negative impact on the organizational performance in the organizations taken for study. Leaders determine values, culture, change tolerance and employee motivation. Effects of Leadership Style on Organizational Performance in Small and Medium Scale Enterprises (SMEs) in Nigeria. But the major drawback of this style of leadership is that the followers are totally dependent on the leader and once the leader leaves the organization, they become direction-less. Klienet al (2013) proved this fact by using four factor theory of leadership along with the data collected from 2,662 employees working in 311 organizations. x��\[s�F�~w�����-�fpIR��9�]�V,e���>@$1�H���U~���3`H����S�N�Hs�����=���m1\�}w8X.��}y�rx5�����yV^w�I�M'GG���W�_�������W"��RFR�Ta�W�_E��~x��^��wp��ׯN��@B��j�j�~����88���t��>l#:�R%�Rv���Aܻ���5���A�,Qs�� endobj The leadership styles such as charismatic and bureaucratic leadership are good styles of leadership for short- term or small projects but as far as the long- term and future prospects are considered, they are not beneficial as they do not lead to employee development, and this does not bring out the expected performances from the employees.

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