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Relationship between leadership styles and organizational performance<br />
Adam Mohamud Ali and Abdukadir Mohamed Abdullahi<br />
SIMAD UNIVERSITY 2016<br />
ABSTRACT<br />
The study focuses the relationship between leadership styles specially the transformational and<br />
transactional leadership styles and Mogadishu municipality performance; it explores the effect of<br />
each municipal leadership style on the effectiveness and efficiency of Mogadishu municipality.<br />
The study conveys the clear and stable role of effective leadership model and how that can effect<br />
the degree of organizational performance, the study tests performance-maintenance theory and<br />
survey was used to collect data through questionnaires.<br />
The major findings of this research showed there is a significant relationship between<br />
transformational leadership style and Mogadishu municipality performance (r=.683,p .000), also<br />
the transactional leadership style was studied and proved that there is a positive relationship<br />
between transactional leadership style and Mogadishu municipality performance (r.608, p .000).<br />
and it is also a prove that both transformational and transactional leadership styles are adopted in<br />
the municipality.<br />
This study is crucial for top managers in Mogadishu municipality to enhance the performance of<br />
the organization by increasing the involvement of these two models in their relationship with<br />
organizational members and staff.<br />
1
CONTENTS<br />
TABLE OF FIGURES 3<br />
CHAPTER ONE 3<br />
INTRODUCTION 3<br />
1.1 Background of the study 3<br />
1.2 Statement of problem 3<br />
1.3 Purpose of the research 3<br />
1.4 Objectives of the study 3<br />
1.5 Research questions 3<br />
1.7 Scope of the research 3<br />
1.8 Significance of the research 3<br />
1.9 Operational definitions 3<br />
CHAPTER TWO 3<br />
LITERATURE REVIEW 3<br />
2.1 Introduction of leadership: 3<br />
2.2 Definitions and concept of leadership 3<br />
Characteristics of transformational leadership 3<br />
Idealized Influence 3<br />
Inspirational Motivation 3<br />
Intellectual Stimulation 3<br />
Individualized Consideration 3<br />
Characteristics of transactional leadership 3<br />
2.3 Comparison between transactional leadership and transformational 3<br />
2.4 Definitions and Concepts of Organizational Performance 3<br />
2.5 Key Measurements of Organizational Performance 3<br />
2
2.6 Organizational Performance Characteristics 3<br />
2.7 Leadership and organizational performance 3<br />
2.8 Conceptual framework and hypothesis 3<br />
2.8.1 Statement of Hypothesis 3<br />
2.9 Summary 3<br />
Conclusion 3<br />
CHAPTER 3 3<br />
METHODOLOGY 3<br />
3.0 Introduction 3<br />
3.1 Research design 3<br />
3.2 Research population 3<br />
3.2.1 Sample size 3<br />
3.2.2 Sampling procedure 3<br />
3.3 Research instrument 3<br />
3.4 Reliability and validity test 3<br />
3.5 Data gathering procedure 3<br />
3.6 Data Analysis 3<br />
3.7 Ethical Consideration 3<br />
3.8 Limitations of the Study 3<br />
CHAPTER FOUR 3<br />
DATA ANALAYSIS AND INTERPRETATION 3<br />
4.0 Introduction 3<br />
4.1 Demographic Characteristics Of The Respondents 3<br />
4.4 Regression analysis 3<br />
4.4. Major Findings 3<br />
4.4 Discussion 3<br />
3
5.0 Introduction 3<br />
5.1 Conclusions Of The Study 3<br />
Implications of the study 3<br />
Implications in practice 3<br />
Implications in theory 3<br />
5.2 Recommendations 3<br />
Recommendations for the research 3<br />
Recommendations for practice 3<br />
APPENDIX A 3<br />
Time Framework 3<br />
APPENDIX B 3<br />
Budget (expenses incurred) 3<br />
References 3<br />
4
TABLE OF FIGURES<br />
Table 1 comparison between styles……………………………………………………………..18<br />
Table 2 descriptive ranges……………………………………………………………………….40<br />
Table 3 demographics……………………………………………………………………………43<br />
Table 4 leadership descriptives…………………………………………………………………..45<br />
Table 5 organizational performance description………………………………………………....47<br />
Table 6 correlation coefficient…………………………………………………………………..49<br />
Table 7 hyothesis test……………………………………………………………………………49<br />
5
CHAPTER ONE<br />
INTRODUCTION<br />
1.1 Background of the study<br />
Leadership has been a central, but sometimes controversial, topic in organizational research<br />
(e.g., Chemers, 2000; Hogan, Curphy, & Hogan, 1994; House & Aditya, 1997; Judge & Piccolo,<br />
2004; Khurana, 2002; Meindl, 1990). for at least the past thirty years, the concept of leadership<br />
has been subject to criticism and marginalization by the dominant organizational paradigms and<br />
perspectives” (Podolny, Khurana, & Hill-Popper, 2005).Part of this controversies has resulted<br />
from questions from the difinitions of whether leadership has the ultimate effect on<br />
organizational outcome (Hannan & Young, 1984; Pfeffer, 1977). Proponents of leadership argue<br />
that leaders have important role and responsibility that help their organizations succeed in<br />
achieving their enabled objectives (e.g., Bass, 1991; Waldman & Yammarino, 1999). In contrast,<br />
organizations are viewed as heavily constrained and that leadership is largely irrelevant and, at<br />
best, a social construction (e.g., Hannan & Freeman, 1989; Meindl, 1990).<br />
In the western world leadership influence in large complex organizations, is assumed<br />
commonly to be greatly significant (liberson & f. o'connor, 1972), but One must consider that<br />
organisational performance may be influenced by a number of factors, such as, the employees’<br />
high satisfaction with their jobs, high commitment to their organization, high motivation to serve<br />
the public and strong intentions to work for the organization willingly and devotedly (Kim, 2005,<br />
p245).<br />
In fast growing economies like Turkey Leadership capability and styles are widely considered a<br />
critical variable in the success of small and medium businesses, which are more vulnerable to<br />
market fluctuations and competition. (Sexon & Bowman, 1985).<br />
Kenyan studies found that leadership style behaviors jointly predict organizational performance.<br />
The study concluded that six leadership styles behaviors should be employed by the Banks’<br />
management in order to perform stronger in the competitive environment (Samaitan, 2014).<br />
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Performance-maintenance (PM) Theory of leadership beginning with replications of the<br />
experimental study by Kurt Le win et al in 1939, the PM theory of leadership has been developed<br />
in Japan as an extensive interdisciplinary and intercultural approach to leadership. The primary<br />
Japanese-born theory of leadership is expressed by Misumi (1995). Misumi carried out<br />
wide-scale research on over 5,000 Japanese workers and managers, and analysed the results<br />
according to two metrics: Performance (P), and Maintenance (M). Performance is concerned<br />
with the achievement of goals, particularly goals relevant to the work group; Maintenance is<br />
concerned with the cohesion of the work group. The original paper which proposed the theory<br />
((Misumi, 1964)) explains the distinction as follows: Assuming three types of leadership, P, M,<br />
and PM, we experimentally analyzed their relationship with the productivity of the group. P-type<br />
corresponds to conventional “autocratic” or “work-centered” type. M-type corresponds to<br />
“democratic” or “human-relation-centered” type, and PM-type is both work and human relation<br />
centered. The results obtained at a governmental training institution showed that PM type<br />
leadership was most effective in terms of both productivity and group moral. Another study<br />
conducted with eight groups of coal mine workers confirmed that also PM style of leadership has<br />
an effective impact on the organizational performance.<br />
Leader means the person with followers (drucker, 1991).<br />
Leadership, as defined by Northouse (2004), is a process whereby an individual influences a<br />
group of individuals to achieve a common goal. Leadership style is the way in which that process<br />
is carried out. Leadership as viewed by Kouzes and Posner (1987) is an ongoing process of<br />
building and sustaining a relationship between those who aspire to lead and those willing to<br />
follow. Performance refers to both behaviors and results, and adjusting organizational behaviors<br />
and actions of work to achieve results or outcomes (Brumbach (1988), as cited in Armstrong<br />
(2001)),<br />
Leadership in public service is defined as Leadership may be defined as a collection of skills and<br />
actions that encourage broad-based participation, facilitate consensus building, distribute shared<br />
responsibility, develop new leaders and enable groups to work effectively to achieve their shared<br />
goals in serving society( h. Aref kashfi,2007).<br />
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Koontz and Donnell (1993) define organizational performance as the ability of an enterprise to<br />
achieve such objectives as high profit, quality product, large market share, good financial results,<br />
and survival at pre-determined time using relevant strategy for action.<br />
Performance is the accomplishment and execution of tasks. According to (Albrecht (2011),<br />
performance is the extent to which an organization achieves a set of pre-defined targets that are<br />
unique to its mission. Leadership style is a key determinant of the success or failure of any<br />
organization.<br />
The performance leadership function (P) is oriented toward goal achievement or problem<br />
solving, and the maintenance leadership function (M) oriented toward preserving group social<br />
stability (el, 1939).<br />
Our research will use the leadership as defined by Northouse (2004), is a process whereby an<br />
individual influences a group of individuals to achieve a common goal, whereas organizational<br />
performance as defined by Koontz and Donnell (1993) that organizational performance is the<br />
ability of an enterprise to achieve such objectives as high profit, quality product, large market<br />
share, good financial results, and survival at pre-determined time using relevant strategy for<br />
action. Leadership style and organizational performance is a necessary topic for discussion since<br />
it is helpful for any organization whether public or private to know how the functions and<br />
qualities of leadership needed to boost organizational performance and we also chose Mogadishu<br />
public departments as our research cite because of the weak functions of our institutions.<br />
1.2 Statement of problem<br />
Today organizational leadership is transformed organizations to a place where people are<br />
empowered, motivated and supported in their personal and professional growth throughout their<br />
careers this has contributed to the enhancement of organizational performance (Gregory Stone,<br />
Kathleen Patterson, 2005).<br />
However, when we talk about Mogadishu municipality, lack of motivation, empowerment, and<br />
support for the employees has caused decline on the effectiveness and efficiency of Mogadishu<br />
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municipality, therefore our research aims to find the appropriate leadership style that can boost<br />
municipality performance so that the service quality of the municipality becomes satisfactory.<br />
1.3 Purpose of the research<br />
This study examines leadership style and organizational performance testing PM theory of<br />
leadership in Mogadishu municipality, our current research spells PM theory of leadership in<br />
enhancing performance of Mogadishu municipality departments in Mogadishu Somalia.<br />
1.4 Objectives of the study<br />
The specific objectives of this study include:<br />
I. To determine how transformational leadership style can influence organizational<br />
performance.<br />
II. To examine if transactional leadership style can effect organizational<br />
performance.<br />
1.5 Research questions<br />
I. Does transformational leadership style increase organizational performance?<br />
II. Is transactional leadership style boost organizational performance?<br />
1.7 Scope of the research<br />
This study aimed to investigate the effect of leadership style on organizational performance in<br />
Mogadishu municipality and it is mainly focused on the effect of leadership style on the<br />
efficiency, and effectiveness in Mogadishu municipality, by testing performance and<br />
maintenance theory of leadership. this study was conducted at the SIMAD University in<br />
Mogadishu as part of Bachelor degree fulfillment at faculty of social science in between<br />
September 2015 and September 2016, the study is cross sectional study which utilizes<br />
questionnaire to collect data.<br />
1.8 Significance of the research<br />
This study is emphasizes Performance-Maintenance theory by giving a new insight in Somalia,<br />
since the Performance-Maintenance theory has been neglected for a while, however this study<br />
proves the theory is effective in every day organizational activities, our research is also a<br />
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stronghold position for anyone interested in further investigation that will enable many<br />
organizations in Mogadishu apply different researched leadership practices to enhance<br />
organizational performance.<br />
We have a very strong feeling that this research will help public institutions in Mogadishu<br />
especially Mogadishu municipality and beyond develop a sense of simplicity over the functions<br />
and quality of service they are acquired to serve the nation since our study posits a framework of<br />
studied styles of leadership and clarifying its powerful influence on organizational efficiency,<br />
productivity and growth.<br />
This study is also an enabling tool for students who are interested in knowing much about<br />
leadership and performance from variety of angles since we provide a distinctive approach for a<br />
topic that passed the horizon for wide range of disputes, our study however shortens precisely the<br />
scope for students and researchers using a dependable data and analysis. There by simplifying<br />
the interpretation of the findings and understanding of the research result.<br />
1.9 Operational definitions<br />
The only definition of a leader is the one who has followers (Drucker, 1991).<br />
Leadership in public service is defined as Leadership may be defined as a collection of skills and<br />
actions that encourage broad-based participation, facilitate consensus building, distribute shared<br />
responsibility, develop new leaders and enable groups to work effectively to achieve their shared<br />
goals in serving society.<br />
Organizational performance is the ability of an organization to achieve such objectives as high<br />
productivity, efficiency and survival at pre-determined time using relevant strategy for action.<br />
Efficiency: the ability to do something without wasting materials, time or energy, it is defined as<br />
a term practiced by organization or firm to use people and resources to carry out important<br />
operations in way which minimizes the costs.(Karamat, 2013).<br />
Effectiveness: organization is the degree to which it moves toward the attainment of its mission<br />
and realizes its goals(Mc et al., 2014)<br />
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CHAPTER TWO<br />
LITERATURE REVIEW<br />
2.1 Introduction of leadership:<br />
In this chapter the researchers will focuses on to review prior literature that related to the<br />
concept of leadership styles and organizational performance in Mogadishu –Somalia, this<br />
chapter will focuses on five sections that is very important ,firstly it reviews the definitions of<br />
independent variables followed by styles of leadership and its characteristics. Secondly it<br />
studies literature of organizational performance followed by characteristics of organizational<br />
performance. The Third section presents prior literature of the relationship between the two<br />
variables leadership and organizational performance. Fourth section the study presents and<br />
explains the conceptual framework of the study. And the last section presents summary and<br />
conclusion of the chapter.<br />
2.2 Definitions and concept of leadership<br />
Leadership as “followers are central to leadership because they are significantly involved<br />
in the negotiations central to the transactions of power they have minds of their own”. (Burn,<br />
1978) Leadership refers to the behavior/ attitude of a leader to collect and direct the individuals<br />
towards any goal. Leadership is a communication process of leader and individuals. (aneesullah,<br />
2013). So the effectiveness of the organization depends on effective leader and it is the one who<br />
have effective leadership style.<br />
In 1957 Political Sociologists defined leadership as “infuse values and purpose of leaders into a<br />
group”. In 1977 Robert Greenleaf described leadership as: “Great leaders serve the group they<br />
lead, by creating and maintaining an environment which encourages and supports everyone in<br />
maximizing their potential”. (Greenleaf, 1997) .<br />
A historian/ political scientist James M Burn also defined in 1978 gave his idea about.<br />
11
One of the best definitions of leadership is proposed by Kim and Maubouregne (1992), which<br />
indicates leadership, is the capability to inspire confidence and support among an organization’s<br />
people who are needed to achieve organizational goals. Rost (1993, P102), defines leadership as<br />
follows; “Leadership is an influence relationship among leaders and followers who intend real<br />
changes that reflect their mutual purposes”. Also, Bass (1990) believes leadership is the<br />
“principal dynamic force that motivates and coordinates the organization in the accomplishment<br />
of its objectives. Also we should note that we can find leadership in all level of positions in<br />
organizations and it does not just stick to high level positions”.<br />
There are varieties of leadership behaviors that are important for a firm. The framework used<br />
by Hart & Quinn (1993) who focus on the roles of the CEO. They declare that CEOs play four<br />
roles to achieve organizational performance. The four roles are vision setter, motivator, analyzer,<br />
and taskmaster, each involving certain duties in the organization. The vision setter defines and<br />
articulates a firm's basic purpose and future direction with attention to the emerging social,<br />
economic, and technological trends. The motivator translates an organization's vision and<br />
economic strategy into a “cause worth fighting for”. To fulfill this role, the CEO must inspire<br />
and motivate employees to accomplish the organization's goals. The analyzer focuses on the<br />
efficient management of internal operating systems, shaping operating decisions, and controlling<br />
management processes. The taskmaster focuses on firm performance and responsibilities by<br />
influencing subordinates' decisions and allocating resources to the highest priority activities. An<br />
effective executive demonstrates a high level of behavioral complexity by being able to perform<br />
all four roles simultaneously. Leadership is not only an in born personality trait. There are<br />
different types of leader. Such as;<br />
Transformational leadership: is defined as leadership approach that causes change in<br />
individuals and social system in its ideal form, it creates valuable and positive change in the<br />
followers with the end goal of developing followers into leaders.” (Burns, 1978)<br />
Transformational Style: Transformational leaders encourage subordinates to put in extra effort<br />
and to go beyond what they (subordinates) expected before (Burns, 1978). The subordinates of<br />
transformational leaders feel trust, admiration, loyalty, and respect toward leaders and are<br />
motivated to perform extra-role behaviors (Bass, 1985; Katz and Kahn, 1978). Transformational<br />
12
leaders achieve the greatest performance from subordinates since they are able to inspire their<br />
subordinates to raise their capabilities for success and develop subordinates‟ innovative problem<br />
solving skills (Bass, 1985).<br />
Characteristics of transformational leadership<br />
Idealized Influence<br />
The major characteristics of transformational leadership include engendering trust, admiration,<br />
loyalty, and respect amongst followers through application of charismatic vision and behavior.<br />
(Lievens, Van Geit, & Coetsier, 1997)Transformational leaders strive towards creating such a<br />
state of idealized influence by:<br />
●<br />
●<br />
●<br />
●<br />
●<br />
●<br />
articulating a vision and explaining how to attain the vision in an appealing manner<br />
leading by example<br />
acting confidently and optimistically<br />
sharing risks with followers<br />
emphasizing values and reinforcing them by symbolic actions<br />
displaying a high level of ethical and moral conduct<br />
Leaders who apply idealized influence on their followers gain the trust and confidence of the<br />
followers. The followers admire the leader as a role model and respect the decisions made by<br />
him or her.<br />
Inspirational Motivation<br />
The transformational leader inspires followers toward the new ideas or goals through<br />
inspirational motivation. The major characteristics of inspirational motivation leadership include:<br />
●<br />
●<br />
●<br />
articulation of a clear and appealing view of the future<br />
development of a shared vision in both economic and ideological terms so that the followers<br />
see meaning in their work<br />
making sure of each follower’s role in the fulfillment of the shared vision, and setting high<br />
standards for the followers to attain objectives<br />
13
●<br />
encouraging followers to integrate and become part of the overall organizational culture and<br />
environment<br />
Transformational leaders elevate people from low levels of need focused on survival by<br />
appealing toward their inborn desire to attain higher levels related to love, learning, leaving a<br />
legacy, and the like. The ways adopted to do so are many, and include:<br />
●<br />
●<br />
●<br />
●<br />
●<br />
making vivid descriptions of a good future that raises one’s imagination<br />
motivational speeches and conversations<br />
public display of optimism and enthusiasm<br />
highlighting positive outcomes<br />
stimulating teamwork<br />
While attempting to motivate followers toward a higher level of needs, transformational leaders<br />
appeal to their followers' own interests as far as possible. The major challenges however relate<br />
to:<br />
●<br />
●<br />
persuading followers to transcend their own interests for the collective team or organizational<br />
interest when required<br />
countering the followers’ emotional resistance to change<br />
Intellectual Stimulation<br />
Transformational leadership encourages change through intellectual stimulation aimed at<br />
self-reflective change of values and beliefs.<br />
Transformational leaders raise their followers’ awareness regarding problems and develop their<br />
capability to solve such problems in many ways. Some of these ways are:<br />
●<br />
●<br />
●<br />
●<br />
●<br />
fostering a climate that favors critical examination of commonly held notions, beliefs, and the<br />
status quo<br />
creating an environment conducive to the creation and sharing of knowledge<br />
encouraging innovation and creativity<br />
heightening sensitivity to environmental changes<br />
encouraging the suggestion of radical and controversial ideas without fear of punishment or<br />
ridicule<br />
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●<br />
empowerment and imposition of the leader's idea only in the absence of viable ideas from the<br />
followers<br />
Individualized Consideration<br />
Individualized consideration ranks among the major characteristics of transformational<br />
leadership. The transformational leader treats each follower as a “whole" individual rather than<br />
as an employee, and considers the individual’s talents and levels of knowledge to decide what<br />
suits him or her to reach higher levels of attainment.<br />
A transformational leader applies such individual considerations by:<br />
●<br />
●<br />
●<br />
●<br />
●<br />
●<br />
listening to each follower’s needs and concerns<br />
expressing words of thanks or praise as a means of motivation<br />
making public recognition of achievements and initiatives<br />
making private notes of congratulations to boost self confidence<br />
ensuring fair workload distribution<br />
undertaking individualized career counseling and mentoring<br />
Technological developments, global competition, the changing nature of the workforce, and<br />
modern management precepts such as Total Quality Management have in recent years forced<br />
organizations to become leaner and flatter. Leadership is the critical factor in the initiation and<br />
implementation of such a change process, and the transformational style of leadership engenders<br />
a positive impact on individuals, teams, and organizations during the change process.<br />
Transactional leadership : also known as managerial leadership, focuses on the role of<br />
supervision, organization ,and group performance , Transactional leadership is a stayl of<br />
leadership in which the leader promotes compliance of his or her followers through both rewards<br />
and punishments unlike Transformational leadership , leaders using the transactional approach<br />
are not looking to change the future ,they are looking to merely keep thing the same. Leaders<br />
using transactional leadership as a model pay attention to followers work in order to fin faults<br />
and deviations. This type of leadership is effective in crisis and emergence situations as well as<br />
for projects that need to be carried out in a specific way”. (Bass B. , 2008) Transactional Style:<br />
Transactional leaders focus mainly on the physical and the security needs of subordinates. The<br />
15
elationship that evolves between the leader and the follower is based on bargaining exchange or<br />
reward systems (Bass, 1985; Bass and Avolio, 1993).<br />
Characteristics of transactional leadership<br />
Transactional leaders use reward and punishments to gain compliance from their followers. They<br />
are extrinsic motivators that bring minimal compliance from followers. They accept goals,<br />
structure, and the culture of the existing organization. Transactional leaders tend to be directive<br />
and action-oriented.<br />
Transactional leaders are willing to work within existing systems and negotiate to attain goals of<br />
the organization. They tend to think inside the box when solving problems Transactional<br />
leadership is primarily passive. The behaviours most associated with this type of leadership are<br />
establishing the criteria for rewarding followers and maintaining the status quo. Within<br />
transactional leadership, there are two factors, contingent reward and management-by-exception.<br />
Contingent reward provides rewards for effort and recognizes good performance.<br />
Management-byexception maintains the status quo, intervenes when subordinates do not meet<br />
acceptable performance levels, and initiates corrective action to improve performance (Odumeru,<br />
Ifeanyi,2013)<br />
2.3 Comparison between transactional leadership and transformational<br />
Comparison Between Transformational and Transactional Leadership James Macgregor Burns<br />
distinguished between transactional leaders and transformational by explaining that:<br />
transactional leader are leaders who exchange tangible rewards for the work and loyalty of<br />
followers. Transformational leaders are leaders who engage with followers, focus on higher<br />
order intrinsic needs, and raise consciousness about the significance of specific outcomes and<br />
new ways in which those outcomes might be achieved (Hay, 2012). Transactional leaders tend to<br />
be more passive as transformational leaders demonstrate active behaviours that include providing<br />
a sense of mission.<br />
Table 2.1 comparisons between transactional and transformational leadership<br />
Transactional<br />
Transformational<br />
Leadership is responsive<br />
Leadership is proactive<br />
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Works within the organizational culture<br />
Employees achieve objectives through<br />
rewards and punishments set by leader<br />
Employees achieve objectives through<br />
higher ideals and moral values<br />
Motivates followers by appealing to their<br />
own self interest<br />
Management-by-exception: maintain the<br />
status quo; stress correct actions to improve<br />
performance.<br />
Works to change the organizational culture by<br />
implementing new ideas<br />
Employees achieve objectives through higher<br />
ideals and moral values<br />
Motivates followers by encouraging them to<br />
put group interests first<br />
Individualised consideration: Each behaviour is<br />
directed to each individual to express<br />
consideration and support. Intellectual<br />
stimulation: Promote creative and innovative<br />
ideas to solve problems.<br />
Douglas McGregor's Theory Y and Theory X can also be compared with these two leadership<br />
styles. Theory X can be compared with Transactional Leadership where managers need to rule<br />
by fear and consequences. In this style and theory, negative behaviour is punished and<br />
employees are motivated through incentives. Theory Y and Transformational Leadership are<br />
found to be similar, because the theory and style supports the idea that managers work to<br />
encourage their workers. Leaders assume the best of their employees. They believe them to be<br />
trusting, respectful, and self-motivated. The leaders help to supply the followers with tool they<br />
need to excel. (Odumeru, Ifeanyi,2013).<br />
2.4 Definitions and Concepts of Organizational Performance<br />
Performance is organizational ability in achieving something related to desired objectives<br />
(Kaithen, 2002). Performance is work results achieved by someone/leader or a group of people<br />
in an institution, in accordance with their respective authority and responsibility to reach the<br />
institutional goal legally, through implementing and respecting the laws of the institution, and in<br />
accordance with moral and ethics (Prawirosentono, 2000). Organizational performance was<br />
17
defined as the extent to which organizations, viewed as a social system fulfilled their objectives<br />
(Tannenbaum, 1957).<br />
The concept of organizational performance is the dependent variable of interested research topic<br />
and it concerned with any area of management (Richard et al., 2008). However the concept of<br />
organizational performance is very common generally in the academic literature, it does not have<br />
common definition and it is difficult to give specific definition because of its many meanings.<br />
For this reason, there isn’t a universally definition for this concept that is accepted.<br />
Managers began to understand that an organization is successful if it accomplishes its goals<br />
(effectiveness) using a minimum of resources (efficiency). Allthouth, organizational theories that<br />
followed supported the issue of an organization that achieves its performance objectives based<br />
on the challenges imposed by the limited resources (Lusthaus & Adrien, 1998 after Campbell,<br />
1970). In this context, profit became one of the many indicators of performance either the profit<br />
is public or private.<br />
We cannot ignore that the style of leadership affects performance since performance cannot<br />
be achieved in the absence of a leadership that can adapt to the changes and challenges of the<br />
environment that knows how to motivate and encourage the employees to do their work<br />
effectively to achieve a desired performance for the organization.<br />
Madrid et al. (2007) opine that high performing firms are able to generate a variety of industry<br />
and society benefits like generating resources, wealth achievement and jobs creation. They<br />
further observe that an accurate measure of performance can provide reliable insight into what<br />
affects performance and how organizations can develop good strategies, arrange resources, meet<br />
society expectations and compete. Good performance and good service for the society is the<br />
ultimate goal of public organizations. All the strategies designed and activities performed thereof<br />
are meant to cause this main objective. However, this does not mean that public organizations<br />
have no other goals. Public organizations could also have additional social, political and<br />
economic goals (Alexandru et al., 2008)<br />
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2.5 Key Measurements of Organizational Performance<br />
Performance is a multidimensional construct and therefore multiple dimensions of performance<br />
should be used (Lumpkin and Dess, 1996). Growth has been argued as an important element to<br />
the attainment of sustainable advantages and profitability (Marksman and Gartner, 2002) and it<br />
is hard to generate realized growth without profitability (Fitzsimmonset al., 2005). Profitability is<br />
also another important dimension of organizational performance that must be considered as it is<br />
unlikely that growth can be sustained without profit contributions (Fitzsimmons et al 2005).<br />
Furnham (2002) assert that the appropriate measurement outcome from leadership quality is<br />
effectiveness (reflecting the leader’s efficacy in achieving organizational outcomes, objectives,<br />
goals and subordinates‟ needs in their job). Therefore, the measure of organizational<br />
performance in this study is represented by the degree to which a company achieves its<br />
organizational objectives.<br />
II.6 Organizational Performance Characteristics<br />
Performance characteristics are qualities, traits, or individual characteristics that are required for<br />
satisfactory performance in a particular job, role or team. As a manager, you will need to select<br />
the characteristics that best emphasize the qualities that are needed for organizational employees<br />
to perform their job duties and objectives successfully (South Carolina university website)<br />
Communication Ability: the effectiveness with which the employee presents accurate<br />
information both verbally and in writing.<br />
Relationships with Others - the extent to which the employee establishes positive relationships<br />
with co-workers (for example, being a good team worker, being tactful and courteous with<br />
co-workers).<br />
Accuracy of Work: or errors that the degree to which the employee makes mistakes requires<br />
correction.<br />
Appearance: the physical appearance of the employee at work; cleanliness, grooming, neatness<br />
and appropriateness of dress for the job.<br />
19
Cooperation: the extent to which the employee cooperates with supervisors, associates and<br />
those for which work is performed.<br />
Dependability: the extent to which the employee can be relied upon to meet work schedules and<br />
fulfill job responsibilities and commitments.<br />
Use of Work Time: how effectively and efficiently the employee uses his/her time to<br />
accomplish his/her job tasks (for example, does not wait until the last minute to work on<br />
important projects).<br />
Meeting Schedules: The extent to which the employee efficiently completes his/her work and<br />
effectively meets deadlines..<br />
Safety: the extent to which the employee follows established safety practices and corrects unsafe<br />
work practices on the job.<br />
Favorable Job Attitude: the extent to which the employee displays interest and enthusiasm for<br />
his/her work and takes pride in a job well done.<br />
Job Knowledge: the extent to which the employee knows the details of the job and follows the<br />
job procedures.<br />
Quantity of Work: the extent to which the employee produces an amount of acceptable work in<br />
order to meet schedules over which he/she has control.<br />
Quality of Work: the extent to which the employee neatly, thoroughly, and accurately<br />
completes job assignments according to established standards of quality.<br />
Relationship with the Public: the extent to which the employee establishes good relationships<br />
with the public (for example, being courteous and helpful).<br />
Judgment: the quality or work-related decision made by the employee<br />
20
2.7 Leadership and organizational performance<br />
An article written titling the Impact of Leadership Style on Performance of the organization the<br />
objective of the study was to examine the leadership styles among Six Sigma professionals and<br />
their impact on performance. The method used was Quantitative description with 146 Six Sigma<br />
professionals working in Thailand were surveyed using the Multifactor Leadership Questionnaire<br />
The findings reveal that there are significant differences among the transformational,<br />
transactional and laissez-faire leadership styles on the organizational performances. (Saowalux<br />
Prasertwattanakul, Peng Chan,2007)<br />
Similarly another article called Human Resource Strategies as a Mediator between Leadership<br />
and Organizational Performance which has the purpose of examining how leadership styles are<br />
related to human resource strategies and organizational performance, The survey was<br />
quantitative description A total of 270 questionnaires were distributed; after eliminating 18<br />
incomplete questionnaires, 251 valid questionnaires remained. The average age of the<br />
respondents was 36 years. The survey resulted a direct positive relationship between leadership<br />
style and organizational performance and an indirect relationship between leadership style and<br />
human resource strategy as a mediator.( Abdulrahman Alsughayir,2014).<br />
Another study about Effects of Leadership Style on Organizational in Nigeria The purpose of<br />
this study was to examine effects of leadership styles on organizational performance in Lagos<br />
state, The study adopted the descriptive survey design using percentages and chi-square (X2) on<br />
hypothesis and questions formulated two hundred (200) employees’ were randomly selected<br />
from only twenty (20) registered SMEs in Lagos State, The findings of the study revealed that<br />
good leadership style enhances employee morale and that there is what is known as participatory<br />
leadership style of management where both employers and employees take decisions that have<br />
positive impact on the growth of the organization and good welfare facilities for the employees.(<br />
Ben-Bernard Prince Uchenwamgbe,2013).<br />
Also another study on Transformational Leadership Style and Its Relationship with<br />
Organisational Performance in Nigerian Work Context with the purpose of investigating the<br />
relationship between transformational leadership style and organizational performance in<br />
21
Nigerian work context, This paper relied on secondary data as its major source of information;<br />
this is to say that the primary method of study was an extensive review of available literature for<br />
description and analysis of the subject matter, The paper concluded that transformational<br />
leadership style has a significant positive relationship with organisational performance in<br />
Nigerian work context (Abasilim, Ugochukwu. David,2014).<br />
Similarly another research called the impact of leadership styles on the organizational<br />
performance. With the objective of exploring the impact of leadership styles on the<br />
organizational performance that uses quantitative method of questionnaire finds that there is a<br />
positive correlation between the transformational leadership style and the performance of the<br />
organizations.( Raluca-Elena Hurduzeu,2015).<br />
Same study on Leadership Practices and Organizational Performance examining leadership<br />
practices, and the relationship between these practices and organizational performance in a<br />
Norwegian context which utilizes quantitative method which The hypotheses were tested in a<br />
survey of 347 participants confirmed an overall positive relationship between transformational<br />
leadership practices and organizational performance.( Dag A Sandbakken,2006).<br />
Nigerian study on Enhancing Organisational Performance Through Effective Leadership In<br />
Nigeria’s Public Organisations which purposes to examine the role of effective Leadership in<br />
enhancing organizational performance in Nigeria’s Public Organizations, The study was a desk<br />
research; hence, secondary source of data was used through the review of theoretical and<br />
empirical literature relevant to the study, The findings clearly indicate that though leadership<br />
plays vital roles in improving organizational performance, many people in leadership positions in<br />
public organizations do not readily understand what constitute leadership functions, qualities and<br />
the dynamic nature of leadership styles (Ray Njoku1, Nwakw Uribe Adindu,2014).<br />
Typical study on Theory X and Theory Y Type Leadership Behavior and its Impact on<br />
Organizational Performance aiming is to find evidence whether leadership styles of the managers<br />
regarding Theory X and Theory Y have positive impact on organizational performance. The<br />
study used quantitative method Out of 200 surveys, 115 were returned. Two of the surveys had<br />
to be eliminated due to missing information. 113 remained (56,5 % response rate) and were<br />
22
analyzed afterwards found that Theory Y leadership behavior may have a general positive<br />
influence on the organizational performance but so far there has been no empirical evidence<br />
directly related to firm’s performance criteria(Aykut Arslana, Selva Staubb,2008).<br />
Another Nigerian research on Evaluation of Leadership and Organizational Performance on<br />
Small Scale Industries in Nigeria, The study aim at evaluating the leadership pattern and the<br />
extent to which it has affected organizational performance in some selected small scale industries<br />
in Nigeria which utilizes quantitative method 180 questionnaires were distributed that is 30 for<br />
each state and 10 per categories selected. 138 questionnaires were returned, The gender were<br />
92 male and 46female, revealed that leadership pattern in small-scale industries significantly<br />
affect overall performance of the business outfit(Idowu, Abiola,2012).<br />
American study on the relationship between leadership styles, organizationl commitment, and<br />
organizational outcome in Oklahoma’s volunteer fire departments, The grand purpose of this<br />
study was to determine if a relationship exists between leadership styles of fire chiefs and<br />
organizational commitment, and performance levels of volunteer firefighters. Members of<br />
volunteer fire departments in the state of Oklahoma were selected as the target population for<br />
the study using quantitative approach for, 220 volunteer firefighters from all across the state of<br />
Oklahoma completed the survey. In 2013, 7,800 volunteer firefighters served in Oklahoma’s<br />
volunteer fire departments (Oklahoma Firefighters Pension and Retirement System, 2013). The<br />
comprised 2.8% of the total volunteer firefighter population analysis showed that the null<br />
hypothesis should be rejected. This also suggests that a positive relationship exists between<br />
transformational and transactional leadership styles and organizational performance in fire<br />
fighters(Youngshix Shin,2013).<br />
According to Fu-Jin Wang , Shieh Chich-Jen and Tang Mei-Ling Discussed the relationship<br />
among the leadership style and the organizational performance the purpose of this study was to<br />
examine the relationships among the leadership style, and the organizational performance. the<br />
method used was Quantitative Descriptive and the sample was 246 valid questionnaires sent to<br />
the corporate owners, executors and operators of Kaohsiung’s Nanzi Export Processing Zone in<br />
south Taiwan The result was The charismatic, transformational and visionary of the leadership<br />
23
style are positively related to the organizational performance. (Wang, Chich-Jen, & Mei-ling,<br />
2010).<br />
In reference on researchers Obiwuru Timothy C Okwu, Andy T.Akpa, Victoria O.Nwankwere<br />
And Idowu A. Studied Relationship b/w leadership style and organizational performance<br />
October 2011 the purpose of this study was To investigated the effects of leadership style on<br />
organizational performance in small scale enterprises. The method used was quantitative<br />
questioner and the sample was Three small-scale enterprises were selected for sample size of<br />
fifteen respondents the result of this study was The analysis has shown that each of charisma and<br />
intellectual stimulation/individual consideration traits of transformational leadership style exerts<br />
positive. (Obiwuru, Okwu, Akpa, & Nwankwere, 2011)<br />
Similar research about Relationship b/w Ethical Leadership & Organizational Performance by<br />
Mohammad Khademfar, The purpose of this Study was to find out whether the Ethical<br />
leadership influences the financial and non- financial performance in Malaysian SMEs and the<br />
method used this research was Quantitative Questioner and the sample size for this study will<br />
reach to 280; the researcher will apply to 300 selected Malaysian SMEs. The result was the<br />
Ethical leadership improve the environment and promote the clients have a sensitive and positive<br />
attitude toward the organizations performance in private and public sector (Khademfar & Amiri,<br />
2013).<br />
In 2013 study is carried out in Somalia by Ahmad Hassan Mohamud, Mohamed Jamal Abdi,<br />
Ismail Ibrahim Mohamed titling Leadership Styles and Organizational performance case of some<br />
selected telecommunication companies in Mogadishu Somali. The purpose of this study is to<br />
examine the relationship between leadership styles and Organizational performance case of some<br />
selected telecommunication companies in Mogadishu-Somalia. The study uses This survey was<br />
through quantitative analysis The sample 100 staff and management working in two<br />
telecommunication companies in Mogadishu was obtained to be participating in this study. And<br />
the result was A significant strong relationship was found between Organizational performance<br />
and transformational (r=0.802, p=0.000). The result further indicated week positive significant<br />
24
elationship between organizational performance and transactional leadership style (r=0.272, p=<br />
0.007). (Mohamud, Abdi, & Mohamed, 2013).<br />
In Pakistan article published in 2012 by Muhammad Akram, Hassan Mobeen Alam, Liaqat Ali,<br />
Muhammad Muazzam Mughal about How Leadership Behaviors Affect Organizational<br />
Performance in Pakistan The purpose of this study to analyze which leadership behavior is most<br />
closely related with organizational performances A quantitative approach is used for Sample of<br />
500 managers and 500 employees the result was all leadership behaviors are positively<br />
interrelated with leader is perceived and employee has perceived organizational performances.<br />
(Akram, Alam, Ali, & Mughal, 2012)<br />
Simultaneous study about Impact of Leadership Styles on Organizational Performance 2014 by<br />
Amal Zada Khan, Nosheen Adnan, The purpose of the study is to examine leadership styles and<br />
their effects on organizational performance A quantitative study was conducted by using a<br />
questionnaire a sample of 240 leaders/managers who were working in various public and private<br />
organizations The result was transformational leadership has a positive relationship with<br />
organizational performance. (Khan & Adnan, 2014)<br />
Also Longe, Olukayode J. studied Leadership Style Paradigm Shift and Organizational<br />
Performance, the purpose of this study was To examine the effect of changes in leadership<br />
styles on organizational performance in a cement manufacturing firm in Ogun State of Nigeria.<br />
The method used was Questionnaire and in-depth interview were used for data collection And<br />
the sample was A total of 385 participants were selected for the study using stratified random<br />
sampling technique The result was the result showed a significant correlation between<br />
transformational, transactional and democratic leadership styles and organizational performance<br />
after the change of management. (Nasomboon, 2014)<br />
According to Albert Puni, Samuel B. Ofei & Abednego Okoe ,They studied The Effect of<br />
Leadership Styles on Firm Performance in Ghana, the purpose of the study was to examine the<br />
leadership styles of two Ghanaian banks and how they affect performance, the method used was<br />
The study was purely quantitative because reliable questionnaire was used to collect data, and<br />
25
The result showed that, none of the leadership styles significantly predicted financial<br />
performance of the two banks. (Puni, Ofei, & Okoe, 2014)<br />
Another study on Kashmir in 2015 by Muzaffar Ahmad Sofi1, Dr. K. Devanadhen titled Impact<br />
of Leadership Styles on Organizational Performance: An Empirical Assessment of Banking<br />
Sector in Jammu and Kashmir. the purpose was A Conceptual Model Of The Impact Of<br />
Leadership Styles (Transformational, Transactional, Participative, Supportive And Instrumental)<br />
On Organizational Performance Of Select Banking Organizations In Jammu and Kashmir, India<br />
The Data Collection Method Used In This Research Work Is Questionnaire Method. The<br />
Findings Reveal That Only Transformational Leadership Style Has Significant Direct Impact On<br />
Organizational Performance While Other Leadership Styles Showed Insignificant Impact.<br />
(Sofi & Devanadhen, 2015)<br />
some researchers like Dr. Emmanuel Iriemi Ejere, Ugochukwu David Abasilim studied Impact<br />
of two Leadership Styles on Organizational Performance Empirical Evidence from Nigeria, The<br />
purpose is to investigate the impact of transactional and transformational leadership styles on<br />
organizational performance in the Nigerian work context. The Research method was quantitative<br />
the data elicited from one hundred eighty four (184) randomly selected respondents. the result<br />
was This study affirms that both transformational and transactional leadership styles had<br />
significant positive impacts on organizational performance. (Ejere & Abasilim, n.d.)<br />
In june this year of 2015 study in Nigeria titling the effect of leadership Style on organizational<br />
performance in Small and Medium Scale enterprises in Makurdi metropolis of Benue State,<br />
Nigeria is carried out, for The purpose of the study was determining the effect of leadership<br />
Style on organizational performance in Small and Medium Scale enterprises using Quantative<br />
quaestionaire, Data was collected from a population and sample of 70 staff of the organizations<br />
The analysis has shown that charisma trait of transformational leadership style exerts positive but<br />
insignificant effect on employees performance (Saasongu, 2015).<br />
According to the Nigerian study covering An Empirical Investigation of Leadership Styles and<br />
Their relationship on Organizational Performance in Nigerian small and medium enterprises<br />
(SMEs) September 20 2014 , The purpose of this study is to examine empirically the relationship<br />
26
etween leadership style and organizational performances, the data generated were analysed by<br />
means of descriptive and inferential statistics, the servey were used sample of 260 small and<br />
mediam enterprice, The results found that the Nigerian SMEs are more autocratic and less<br />
participative as the power distance between business owner and employees is very wide<br />
(Abdulazeez Abioye Lawal1, 2014).<br />
Similar research about The Relationship of Leadership Styles and organizational performance<br />
among public Academic Leaders in Klang Valley Area in 2014, The purpose of this study was to<br />
examine the relationship between the leadership styles and the organizational performance, a<br />
quantitative method for A sample size of 201 academic leaders is chose in order to ensure the<br />
sample size is big enough to answer the questions accurately The results gained from this study<br />
had proven that the relationship between leadership styles and organizational performance was<br />
significant but not statistically significantly high (Hazira Mohd Nasir1, 2014).<br />
In 2014 study is carried out in Nigeria titling Leadership and organizational performance in the<br />
Nigeria small and medium enterprises, The purpose of this study is to examine empirically the<br />
relationship between leadership style and organizational effectiveness in the Nigerian small and<br />
medium enterprises. The study uses Quantitative method, Questionnaire is the main data<br />
collection instrument for this study with a sample of 200 respondents has concluded that the<br />
availability of appropriate tools of leadership management in SMES enhances employee<br />
performance so enhances organizational performance. (lawal, 2014)<br />
In Malaysian article published in 2014 about leadership behaviors and organizational<br />
performance, The purpose of this study to investigate the impact of leadership behaviors on the<br />
performance of services in Malaysia. A quantitative approach is used for 193 respondents have<br />
finalized that there is a significant positive relationship between the leadership behaviors and<br />
organizational performance of services (Arham, 2014)<br />
Simultaneous study about the Effects of Leadership Style on Organizational Performance in<br />
2014, The purpose of this study was to investigate the effects of leadership style on<br />
organizational performance in Brick Kilns in Jammu region. This study used quantitative<br />
description with a sample of 120 respondents The result showed that while transactional<br />
27
leadership style had significant positive effect on performance, transformational leadership style<br />
had positive but insignificant effect on performance (gubta, 2014).<br />
Also in 2014 study published in Kenya about the impact of leadership style on organizational<br />
performance in commercial Banks in Kenya. The purpose was to examine the impact of<br />
leadership style on organizational performance in commercial Banks in Kenya survey sampling<br />
technique was adopted and relevant primary data was gathered with the aid of a structured<br />
questionnaire administered on respondents, The target population for the study was all the 43<br />
commercial banks operating in Kenya and the study covered all the forty three banks. No<br />
sampling, Findings showed positive and negative correlation between leadership style and<br />
organizational performance (Cindy, 2014).<br />
Similar article published in 2013 with the title of leadership style and organizational performance<br />
with the purpose of describing, explaining and interpreting in depth the role of leadership styles<br />
on organizational outcomes, the research uses qualitative method with a primary source of data<br />
collected through interviews and concluded that leadership is important for organizational<br />
performance (1*Muhammad Bahzar, 2013)<br />
Another study on Kenya in 2012 about the effect of leadership styles on organizational<br />
performance in state owned corporations in Kenya aiming to investigate the main effects of<br />
leadership styles of organizational performance using quantitative method on 72 participants<br />
including middle and senior managerial employees in Mombasa state owned corporations<br />
indicated Contingent Rewards and Active Management by Exception have a medium positive<br />
correlation with organizational performance. (Koech, 2012)<br />
Finally some researchers are studied impact of leadership style and organizational performance,<br />
for the purpose of to examine the impact of leadership style on organizational performance in<br />
some selected banks in Ibadan Nigeria, this study were used quantitative description for sample<br />
of 60 respondents and the last the findings of this study showed positive and negative correlation<br />
b/w leadership style and organizational performance. it was also found that leadership stayl<br />
measurements jointly predict organizational performance (Ojokuku R. M1, 2012).<br />
28
However Most literatures relating to transformational leadership style proved that<br />
transformational leadership has strong positive relationship with organizational performance and<br />
outcomes (Avolio, 1999; Bass, 1998). However few studies made on transformational and<br />
transactional leaderships have predicted a positive relationship and most of them emphasize on<br />
transformational leadership to be stronger because of that transformational leaders ability to<br />
create more inspired, committed, and cohesive culture in their organizations (Greyer and Steyrer,<br />
1998).<br />
But that doesn’t mean that transactional leaders have no role in organizations outcome, the only<br />
reason why most researches lack positive correlation is that they lack proper mediating factor<br />
between transactional leaders and organizational performance (Yuke, 1999). For example,<br />
Transactional leadership can help an organization to more efficiently achieve its objectives by<br />
connecting job performance to rewards and also by ensuring that employees have the necessary<br />
resources (Zhu et al., 2005). Mehra et al. (2006) argued that organizations that are looking for<br />
efficient ways to outperform their competitors often focus on leadership. This leader-centered<br />
perspective has offered helpful insights into how leadership is related to team performance (Zhu<br />
et al., 2005). Some researchers (Keller, 1992; McGrath & MacMillan, 2000; Purcell et al., 2004;<br />
Northouse, 2011) have explored the strategic role of leadership and how leadership paradigms<br />
and leadership behavior can be used to improve organizational performance. Previous research<br />
has generated expectations that leadership paradigms will directly affect customer satisfaction,<br />
financial performance, and staff satisfaction. In the extant leadership research, results tend of<br />
depend on the level of analysis. House and Aditya (1997) identified micro-level research with a<br />
focus on leaders in relation to their subordinates and immediate superiors, as well as macro-level<br />
research that has a closer focus on the overall organization and the organization’s environment.<br />
According to Tarabishy et al. (2005) suggested that leaders, as well as their leadership styles,<br />
influence the subordinates and also influence organizational outcomes.<br />
2.8 Conceptual framework and hypothesis<br />
29
There are other factors which are also very important for achieving organizational performance<br />
such as organizational commitment, work motivation, but our study intends to leadership styles<br />
as the prime factor for higher organizational performance.<br />
2.8.1 Statement of Hypothesis<br />
Hypothesis 1<br />
: Transformational leadership has stronger positive relationship with organizational<br />
performance in Mogadishu municipality.<br />
Hypothesis 2<br />
: Transactional leadership is a predictor for better organizational performance in<br />
Mogadishu municipality.<br />
2.9 Summary<br />
After reviewing articles we can conclude that leaders in every organizational have an important<br />
role in enhancing organizational effectiveness by reaching the goals and objectives of the<br />
institution, by doing so they need to be either goal oriented or activity oriented which we mean<br />
by transformational and transactional leadership styles, and the majority of the articles and<br />
materials we reviewed prove that The need for adequate motivation, suitable working<br />
environment, compensation and efficient communication between employers and employees are<br />
important to promoting excellent organization performance.<br />
Conclusion<br />
in this chapter we have reviewed our research literature, definitions of the leadership and its<br />
dimensions mentioning transformational leadership, transactional leadership and laizess faire and<br />
their relationship with organizational performance mentioning growth and productivity as the<br />
measurements of the organizational behavior, then we have build concept about the relationship<br />
between the leadership measurement and organizational behavior measurements<br />
30
CHAPTER 3<br />
METHODOLOGY<br />
3.0 Introduction<br />
This chapter focuses on the methodology of the study. The chapter consists of several sections.<br />
First section is research design followed by research target population including sample size and<br />
sample selection procedure. The third section provides research instruments with the validity and<br />
reliability test of the data and the data gathering procedure, to analyze the data. Section five<br />
presents data analysis followed by the ethical consideration of study, while final section presents<br />
the constraint/limitation of the study.<br />
3.1 Research design<br />
Our research investigates the relationship between leadership styles and organizational<br />
performance in Mogadishu municipality, this study adopted descriptive and explanatory research<br />
design using questionnaire to gain data about the causal relationship between leadership styles<br />
and organizational performance, we will describe the respondents, compare the information,<br />
analysis and interpret the correlation between the variables, A cross-sectional survey was<br />
adopted for this purpose of this study because the Cross-sectional is cost and time effective<br />
because data can be gathered just once perhaps over a period of days or weeks or months, in<br />
order to answer research questions (Sekarana, 2003).<br />
3.2 Research population<br />
Our target population of the study is Mogadishu municipality and the accessible population is<br />
400 employees of local government in mogadishu municipality (Mohyadin, Farah, &<br />
Abdirashiid, 2014).<br />
3.2.1 Sample size<br />
We used Slovin’s formula to calculate the sample size, with maximum acceptable error of 5%.<br />
S =<br />
N<br />
1+Na 2<br />
31
N: Stands the population size<br />
S: sample size<br />
a. Stands acceptable error<br />
n = 200<br />
400<br />
=<br />
1+400(0.05) ˆ 2<br />
The sample sizes of the current study will be 200 employees from local government of<br />
Mogadishu.<br />
3.2.2 Sampling procedure<br />
The study will conduct probability sampling particularly stratified random sampling It<br />
refers probability sampling procedure in which the population is divided into two or more<br />
relevant strata. The main strata in this study will be male and female educated workers in<br />
Mogadishu municipality.<br />
3.3 Research instrument<br />
This study will use an adapted questionnaire as a tool of data collection from every respondent.<br />
The main purpose of the questionnaire is to collect a lot of information short period of time.<br />
Because questionnaire suitable if a population is large and time is limited, we use questionnaire<br />
to quantify the respondents, the researchers will adopt multifactor leadership questionnaire<br />
developed by bass and Avolio 1990, used by Ali yassin 2013, and organizational performance<br />
questionnaire developed by Md. Zohurul Islam and Sununta Siengthai,2009.<br />
Therefore the structure of this questionnaire will be two parts first part will demographic<br />
information about the respondents with four questions and the second part consist of questions<br />
about leadership styles and organizational performance of 21 questions, the questionnaire has<br />
scales to determine the level of agreeing the status such as strongly Agree, Agree, Don’t know,<br />
Disagree, and Strongly Disagree. The questionnaires will be distributed equally to all members<br />
of the target sample we will also avoid any contradiction and invention questions in our<br />
questionnaires.<br />
32
3.4 Reliability and validity test<br />
In order to make sure the accuracy and consistency of the survey we apply instrumental tests<br />
such as reliability, validity tests.<br />
Reliability refers to the extent to which data collection technique or techniques will yield<br />
consistent findings, similar observation would be made or conclusion reached by other<br />
researchers or there is transparency in how sense was made from the raw data (sounder et al,<br />
2009). In order to keep the quality of our study we would like to measure the internal consistent<br />
of the reliability test for the confidence of the output for the study can be applicable the<br />
measurement should exceeded 70% (Cronboch alpha, 1951), Thereby the research team will use<br />
show testing than reliability test, in order to maintain the consistent and validity of the instrument<br />
by aiding statistical package for Social Sciences,, (SPSS Version 16.0).<br />
Validity refers to the extent to which data collection method or methods accurately measure what<br />
they were intended to measure or to the extent to which research findings are really about what<br />
they are claimed to be about (Saunders et al., 2009). Thereby to establish validity, three experts<br />
will evaluate to the intent of this learn.<br />
3.5 Data gathering procedure<br />
A- Before gathering the data we will ask confirmation letter from the office of record and<br />
admission so that we can precede our research legitimately in the local government of<br />
Mogadishu and distribute questionnaires.<br />
B- After we get approval we will begin to visit departments in the municipality and<br />
distribute questionnaires and collect data from both primary and secondary sources, the primary<br />
sources will be databases available and previous literatures on leadership styles and its effect on<br />
organizational performance in Benadir region, the secondary data will be questionnaires we<br />
distribute to local government employees. When distributing the questionnaire we will avoid any<br />
kind of bias and prevent from irrelevant employees.<br />
33
C- Then we analysis the data using SPSS version 16.0 to know the correlation and<br />
regression analysis for the data and results will be published in our research papers.<br />
3.6 Data Analysis<br />
To analyze date we will use explanatory tools for analyzing in SPSS Version 16.0 such as<br />
regression and correlation. Regression will be used to test hypothesis, while correlation<br />
coefficient will be used to investigate the relationship between employee leadership styles and<br />
organizational performance in Mogadishu local government Somalia. Descriptive analyses will<br />
also be used as a measure of central tendencies such as mean, median and mode the following<br />
table will indicate how descriptive analysis is undertaken.<br />
Table 3.1 descriptive ranges<br />
No Range Description Meaning<br />
1 1-1.8 Strong Agree Very high<br />
2 1.8-2.6 Agree High<br />
3 2.6-3.4 Neutral Normal<br />
4 3.4-4.2 Disagree Low<br />
5 4.2-5.0 Strong Disagree Very low<br />
3.7 Ethical Consideration<br />
In this study the researchers will consider the ethical issues throughout the research project, and<br />
will keep the openness, privacy and confidentiality of the respondent, to keep the ethical issues<br />
data given by the respondent was used only for academic purpose, this research will conducted<br />
ethically, all copyright will observed and permission is required to reproduce materials will be<br />
sought.<br />
34
3.8 Limitations of the Study<br />
Our research has been an interesting journey for us and while our study we have seen a lot of<br />
people, we met many people and it was fruitful that we moved with smooth steps with no regrets<br />
and all the time in the past months we can conclude that it was perfect and we haven’t met any<br />
describable constraints<br />
CHAPTER FOUR<br />
DATA ANALAYSIS AND INTERPRETATION<br />
4.0 Introduction<br />
In this chapter, we put forward our research data and findings, the data was analyzed using<br />
statistical techniques such as, descriptive tools in the demographics of respondents and<br />
correlation and regression at the relationship of variables, and we present demographic variables<br />
of respondents using tables for further clarification of data collection. The data presentation and<br />
analysis under this chapter of the study is presented in complete research data that was collected<br />
from our target population, and finally research findings is shown in terms of statements and<br />
tabular then we conclude with discussions about the findings by interpreting the results of the<br />
study.<br />
4.1 Demographic Characteristics Of The Respondents<br />
In this part we emphasize the background information of the respondents whom we have<br />
collected our information from; the purpose of checking the backgrounds of the respondents in<br />
this study is to know the characteristics of the respondents and to present credible information.<br />
Furthermore, the respondents have also given the promise that all the data they provided is used<br />
for the purpose of Academic research and practice, and the identities of the respondents will be<br />
kept confidential. In total 100 respondents filled the questionnaires from the Mogadishu<br />
35
municipality. in the demographic section the questionnaire is classified upon in terms of Gender,<br />
Age, marital status, level of education, and work experience .<br />
In table 4.1 shows the gender of the respondents which is 64% male and 36% female Based on<br />
data gathered, the majority of the respondents of this study are male, while a significant number<br />
of the respondents are female. Thus, male employees have dominated in Mogadishu municipality<br />
since male workers are almost twice the women workers.<br />
Also in the table it is clear that the number of respondents aged 18-35 years are (62%) who are<br />
relatively greater than the percentage of respondents aged in 36-45 years (24%), and above 46<br />
years (14%), this implies, that majority of the respondents are young men and women between<br />
18-35 years of age, and quite significant number of middle aged employees of 24%.<br />
At the side of education and qualification we found that secondary level respondents were 18%<br />
also the diploma level were 18% but The majority of the respondents of this research were<br />
Bachelor level with (52%), we also found that those with higher than bachelor degree accounted<br />
for only 12% .<br />
The table also shows the marital status of the respondents which are 48% married, 48% single<br />
and the remaining 4 % of the respondents are others. This result showed that the majority of the<br />
respondents of this study are married due to their getting employed & family support.<br />
The Table also shows that 7% of the respondents have less than one year of experience, 20% have<br />
one year of experience, 26 also have two years experience and 47% out of total of 100 have more<br />
than two years of experience. So that, in the context the most respondents have more than two years<br />
of experience<br />
Table 4.1<br />
Demographic profile Frequencies Percentage<br />
1. Gender<br />
Male 64 64 %<br />
Female 36 36 %<br />
Total 100 100 %<br />
36
2. Age<br />
18- 35 62 62%<br />
36-45 24 24%<br />
45 And above 14 14%<br />
Total 100 100.0<br />
3. Educational Level<br />
Secondary 18 18<br />
Diploma 18 18<br />
Bachelor 52 52<br />
above 12 12<br />
Total 100 100.0<br />
4. Marital Status<br />
Single 48 48%<br />
Married 48 48%<br />
Others 4 4%<br />
Total 100 100.0<br />
5. Experience<br />
Less Than one year 7 7 %<br />
One Year 20 20 %<br />
Two year 26 26 %<br />
Above 47 47 %<br />
Total 100 100.0<br />
37
4.2. Descriptive findings of leadership style and organizational performance<br />
As you will see in table 4.2 in this part we discussed about variable finding of each item such as<br />
the mean index, standard deviation and interpretation of the result.<br />
Firstly we discussed about the independent variable, the first question has mean index 2.26 and<br />
Standard deviation 1.244 which shows that respondent Agreed in this question. The second<br />
question obtained mean of 2.38, standard deviation of 1.254 and interpretation of this question<br />
was Agree. The third question has 2.33 mean index and standard deviation 1.248 meaning that<br />
they agree for this question. The mean index for 4th question was 2.6, standard deviation of<br />
1.393 and the respondents denote agree in this question. The 5th question scored mean 2.68 and<br />
standard deviation of 1.377 which means the respondents agreed. The 6 th question obtained mean<br />
of 3.09, standard deviation of 1.386 and interprets Neutral. The 7 th question has 2.85 mean index<br />
and standard deviation 1.336 interpreting that the response is Neutral in this question.<br />
The mean index for 8 th question got 3.11 standard deviation of 1.399 and the respondents<br />
presents Neutral in this question. The 9 th question scored mean 3.03 and standard deviation of<br />
1.283 according of the interpretation respondents denotes Neutral. The 10th question obtained<br />
mean 2.66, standard deviation of 1.485 and interpretation of this question ware neutral.<br />
The 11 th question has mean index of 2.89 and standard deviation of 1.392 meaning neutral in this<br />
case. The overall mean index of the independent variable is 2.73 and standard deviation of 1.348<br />
that indicates neutral .<br />
Table 4.2: Descriptive analysis on leadership style<br />
SN Items Mean Standard Interpretation<br />
Deviation<br />
Transformational leadership<br />
1 My boss seek different prospective when solving 2.26 1.244 Agree<br />
problem<br />
2 My boss talks optimistically about a future 2.38 1.254 Agree<br />
38
3 My boss specifies the importance of having strong<br />
sense of purpose<br />
2.33 1.248 Agree<br />
4 My boss talks enthusiastically about what needs to<br />
accomplished<br />
2.6 1.393 Agree<br />
5 My boss spend time teaching and coaching 2.68 1.377 Neutral<br />
6 My boss acts in a way that builds my respect 3.09 1.386 Neutral<br />
Mean index 2.56 1.317 Agree<br />
Transactional leadership<br />
7 My boss provides me with assistance in exchange<br />
for my effort<br />
2.85 1.336 Neutral<br />
8 My boss fails to interface until problem become<br />
serious<br />
3.11 1.399 Neutral<br />
9 My boss waits for things to go wrong before<br />
taking action<br />
3.03 1.283 Neutral<br />
10 My boss makes clear what one can expect to<br />
receive<br />
2.66 1.485 Neutral<br />
11 My boss concentrates his/her attention on dealing<br />
with mistakes<br />
2.89 1.392 Neutral<br />
39
Mean index 2.9 1.379 Neutral<br />
Secondly we report the dependent variable questions results, the 1 st question has 2.90 mean index<br />
and standard deviation 1.446 interpreting that response is neutral in this question. The mean<br />
index for 2 nd question is 3.10, standard deviation of 1.487 and the respondents denote Neutral in<br />
this question. The 3 rd question has score mean index 2.95 and standard deviation of 1.388 in<br />
according to the interpretation respondents present Neutral. The 4 th question has a mean of 3.13<br />
and standard deviation of 1.45 according of the interpretation respondents denote Neutral. The<br />
mean index for 5 th question is 3.11, standard deviation of 1.39 and the respondent is Neutral in<br />
this question. The mean index for 6 th question was 2.84, standard deviation of 1.42 and the<br />
respondents denotes Neutral in this question.<br />
The 7 th question obtained mean 2.98, standard deviation of 1.49 and interpretation of this<br />
question is Neutral. The 8 th question has 3.23 mean index and standard deviation 1.302<br />
interpreting that the response is Neutral in this question.<br />
Now the Overall the average mean index of dependent variable questions was 3.03 and the<br />
standard deviation is 1.39 this indicates that the overall questions of dependent variable was<br />
neutral to the respondents according to the context.<br />
Next we described the dependent variables as follows:<br />
Efficiency<br />
12 To me, not many workers quit or leave their jobs<br />
in this organization<br />
2.90 1.446 Neutral<br />
13 Workers are getting overtime benefits 3.10 1.487 Neutral<br />
14 The work is always done in time 2.95 1.388 Neutral<br />
15 Financial Resources are utilized competently 3.13 1.454 Neutral<br />
Mean index 3.02 1.44375 Neutral<br />
40
Effectiveness<br />
16 Customers are satisfied with services delivered 3.11 1.392 Neutral<br />
17 Services are delivered in all working days<br />
conveniently<br />
2.84 1.426 Neutral<br />
18 My organization has annual objectives 2.98 1.497 Neutral<br />
19 Annual objectives are accomplished 3.23 1.302 Neutral<br />
4.3: Zero Table Correlated between leadership style and organizational performance<br />
As shown in table 4.3, the relationship between Leadership style dimensions and organizational<br />
performance in Local government Mogadishu are investigated using linear correlation<br />
coefficient. The first objective of our study was to explore the Impact of Transformational<br />
leadership on organizational performance. Thus, result indicates that there is positive correlation<br />
as shown, the correlation coefficient .000 levels, in this study the transformational leadership had<br />
a positive correlation with organizational performance (r= .683**, P .000).<br />
The 2 nd objective of our study was to investigate the impact of Transactional leadership on<br />
organizational performance, we found that Transactional leadership has positive relationship<br />
with organizational performance (r.608**, p .000).<br />
Since this study is exploratory in nature, the collected data are further analyzed using the<br />
Bivariate Correlation test. The Bivariate Correlation test computes Pearson‟s correlation<br />
coefficient, and measures how variables or rank orders are related. Pearson‟s correlation<br />
coefficient is a measure of linear association. The correlation coefficient value (r) range from<br />
0.10 to 0.29 is considered weak, from 0.30 to 0.49 is considered medium and from 0.50 to 1.0 is<br />
considered strong as shown in the following table.<br />
41
Table 4.3: Correlation Coefficient<br />
No Variable 1 2 3<br />
1 Transformational Leadership 1<br />
2 Transactional Leadership .612** 1<br />
3 Organizational performance .683** 608** 1<br />
4.4 Regression analysis<br />
In the study, regression analysis was conducted to test hypothesis, direction of relationship<br />
between independent variables and independent variable was also studied .It was observed that<br />
transformational leadership style (B= 0.497, p=.000) which means that transformational<br />
leadership influence and promotes organizational performance and transactional leadership style<br />
has (B= 0.303, p=.000) having positive and pronounced on organizational performance. The<br />
impact of independent variables on the dependent variable jointly explain 52% whereas only<br />
48% effect on organizational performance is explained by other variables not taken into<br />
account(R square =.524) which confirms the validity of the model as shown in the following<br />
table 4.4.<br />
Table 4.4: Hypothesis Test Using Regression Analysis<br />
Organizational performance<br />
Beta T Significance Remarks<br />
Variable<br />
Transformational .497 5.618 .000 Accepted<br />
Transactional .303 3.426 .001 Accepted<br />
R 0.724<br />
R square 0.524<br />
42
4.4. Major Findings<br />
The research we made in Mogadishu municipality was interesting and the people we met were<br />
delighted to cooperate with us since they answered the research questions with utmost sincerity,<br />
our objectives were to firstly test whether transformational leadership has an effect on the<br />
performance of Mogadishu municipality and after we collected information from employees of<br />
100 the results show impressive and in fact transformational leadership has a positive impact on<br />
the performance of Mogadishu municipality since most of the responses agreed with a Beta of<br />
.497 which indicates which means that transformational leadership influence and promotes<br />
organizational performance agreeing that transformational leadership traits are practiced in<br />
Mogadishu municipality, such as inspiration, focus on organizational goals and leading with<br />
vision.<br />
Secondly we aimed to see if transactional leadership style can influence on the effectiveness and<br />
efficiency of Mogadishu municipality and we found a Beta of .303 which means transactional<br />
leadership has a positive and pronounced effect on organizational performance and those<br />
transactional leadership traits such as problem solving and strong relationship between leaders<br />
and employees.<br />
43
4.4 Discussion<br />
As discussed in the previous topics this study was intended to investigate the relationship<br />
between Leadership style and organizational performance especially in Mogadishu municipality.<br />
To concentrate on the research problem we made objective for our study as follows:-<br />
● The 1 st objective of this study was to know the effect of transformational Leadership<br />
style on organizational performance in Mogadishu municipality.<br />
● The 2 nd objective was to examine how transactional leadership style can affect<br />
organizational performance of Mogadishu municipality.<br />
In the first objective We found that there is moderate positive relationship between<br />
transformational leadership and the performance of Mogadishu municipality (r= 0.683, p=0.000)<br />
which means that transformational traits of leadership practiced by Mogadishu municipality<br />
leaders have a better impact on the performance of the organization and it also means that<br />
whenever transformational leadership is practiced the more likely performance increases.<br />
The result of the second objective also shows a significant relationship was found between<br />
transactional and the performance of Mogadishu municipality, transactional leadership style<br />
positively influenced the performance of Mogadishu municipality.<br />
In general both transactional leadership style and transformational leadership style have a<br />
positive influence that can enhance the overall performance of Mogadishu municipality specially<br />
at the sides of efficiency and effectiveness of the entire organization, in other words, the results<br />
support that workers preferred both transformational and transactional leadership styles since<br />
there is a strong relationship between transformational leadership style and the performance of<br />
Mogadishu municipality as well as transactional leadership style and performance of Mogadishu<br />
municipality.<br />
44
CHAPTER FIVE<br />
CONCLUSIONS AND RECOMMENDATIONS<br />
5.0 Introduction<br />
In this chapter we concluded our study with conclusions and relative recommendations for the<br />
study in the first section we write some conclusion points on the research we carried out in<br />
Mogadishu municipality which was interesting and fruitful study, then in the second section we<br />
talked about brainstormed recommendations for the study and I hope it will be interesting too.<br />
5.1 Conclusions Of The Study<br />
This study was about the Leadership style and Organizational Performance In Mogadishu<br />
municipality. The target area was Mogadishu since it’s the capital of federal republic of Somalia,<br />
we preferred it to be role model for other municipalities in the country of our study which is<br />
Federal republic of Somalia, the target population of our study was Civil servants working in the<br />
different departments of Mogadishu municipality we used a descriptive design to investigate the<br />
charecteristics of respondents. Cross-sectional survey strategy was also conducted with a<br />
possible population of 100 citizens. And the aim was of The study was explanatory research<br />
design to test the relationship between Leadership Style and Organizational Perfomance in<br />
Mogadishu municipality.<br />
The first objective was to determine the role of Transformational Leadership Style on<br />
Organizational Performance in Mogadishu Municipality and we found that overall average of the<br />
responds agreed that there are transformational leaders in Mogadishu municipality who possess<br />
characteristics of the transformational leaders with a Beta of .497 and this contributes to the<br />
performance of Mogadishu municipality which means that transformational leadership influence<br />
and promotes organizational performance.<br />
The second objective of this study was to describe the effect of transactional Leadership On<br />
organizational performance. The researchers found a beta of .303 which indicate transactional<br />
leadership has a positive and pronounced effect on organizational performance<br />
45
On the other hand the first objective of the study was to explore the contribution of<br />
Transformational Leadership Style on Organizational Performance. Thus, result indicated that<br />
there is positive correlation as indicated correlation coefficient .000 levels, in this study the<br />
Transformation had positive and moderate correlated (r=.683; P .000).<br />
Objective two this study was to investigate the impact of Transactional Leadership Style On<br />
Organizational Performance, the researchers found that Transactional has positive significance<br />
on public service delivery as indicated (r=.608, p .000).<br />
Implications of the study<br />
This target of this research was to find out how leadership styles can effect organizational<br />
effectiveness and efficiency specially in Mogadishu municipality, so this research can support<br />
both the practice and theory of the study.<br />
Implications in practice<br />
1- This research indicates how important leadership style in both organizational efficiency<br />
and effectiveness and it proves how organizational management can enhance<br />
performance of the organization through effective leadership style .<br />
2- Mogadishu municipality can now ensure which style can benefit for the organization to<br />
effectively perform its role in service delivering through participation of the employees,<br />
trust among different departments and leading with vision.<br />
3- Mogadishu municipality managers have to analyze different situations that can enable<br />
organization to use its resource efficiently whether material or human beings through<br />
effective communication between the managers and the employees.<br />
Implications in theory<br />
1. The theory enabled was performance maintenance theory, it focused on how<br />
organizations can develop by successfully choosing effective leadership model applicable<br />
to every situation, so this study indicates how both transformational and transactional<br />
leadership have a parallel effect on organizational performance.<br />
46
2. Theoretical implications of this study suggest leadership style of the organization is<br />
sometimes not the ultimate factor that can enhance organizational effectiveness and<br />
efficiency that there are many other factors which can influence the performance of the<br />
organization, therefore theoretically this study focuses on one factor which is leadership<br />
style.<br />
5.2 Recommendations<br />
After we found the relationship between leadership style and organizational performance of<br />
Mogadishu municipality, In this part we would like to discuss about the possible ideas and<br />
recommendations for Mogadishu municipality the researchers of this study recommended the<br />
followings.<br />
Recommendations for the research<br />
1. We recommended a continuous research over the expanding size Mogadishu municipality<br />
functions in the near future.<br />
2. In this study we used questionnaire while there are several other instruments, we suggest<br />
application of different instruments that are useful too like interview in order to test<br />
whether the result is going to be the same or not.<br />
3. We also recommend that there are other important factors that affect the performance of<br />
Mogadishu municipality such as employee commitment organizational culture and<br />
environment, organizational accountability and capacity of employees to their job, so we<br />
suggest to study all the factors that are necessary to enhance the performance of<br />
Mogadishu municipality<br />
Recommendations for practice<br />
1. Mogadishu municipality should improve and tighten its security gate ways and hire<br />
professional security officers since there is a leak in the gate operations.<br />
2. Mogadishu municipality should identify key factors that affect performance of employees<br />
such as reward and promotion for the employees.<br />
47
3. Mogadishu municipality should fill social and economic needs of its employees such as<br />
health and housing facilities.<br />
4. Mogadishu municipality should implement a justice and accountability framework with<br />
reward and punishment discipline to develop a sense of responsibility among employees.<br />
48
NO. Time Frame<br />
APPENDIX A<br />
Time Framework<br />
Activities<br />
1 1-15october/2015 Planning of the project<br />
2 25/October/2015 Developing and submitted research topic<br />
3 2/November/2015 Submitted complete chapter one ”Introduction”<br />
4 18/November/2015 Chapter two “ Related Literature Review”<br />
5 25/November/2015 Chapter Three” Research Methodology’<br />
6 3/November/2015 submitted final draft of the research proposal<br />
7 8/ December / 2015 Defending of the project proposal<br />
8 5/April/2016 Submission of chapter four and five<br />
49
NO. Description<br />
APPENDIX B<br />
Budget (expenses incurred)<br />
Expense number<br />
1 Internet access $ 30<br />
2 Transportation expenses 30<br />
3 Printing expense 23<br />
4 stationary and supply material 5<br />
5 Telephone expense 15<br />
7 Supervision fee 120<br />
8 Miscellaneous expense 7<br />
TOTAL: $ 230<br />
50
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