Abstract

This study investigates the impact of leadership styles on employee performance with Global Health System Solution (GHSS) as a case study. The study assessed five major leadership styles: autocratic, democratic, laisser-faire, transformational, and transactional on the performance of employees. Data was obtained by administering questionnaire to personnel in GHSS. The data was analyzed with the help of statistical software program SPSS-17. Pearson correlation was conducted to examine whether the hypothesis was accepted or rejected.

Findings show that a strong correlation existed between leadership styles and employee performance, with democratic leadership style being the dominant style with a significant impact compared to other variables. It shows that if the leaders involve the employees or team members more in the decision making process, it will increase job satisfaction and also helps to develop people’s skills thereby increasing performance. Employees will fell in control of their own destiny and be motivated to work hard, beside financial reward. This implies that leadership of GHSS was keen on building team and long lasting relations with employees to achieve project targets and future work.

The study also revealed that while democratic leadership style had a strong positive impact on employee performance; laisser-faire leadership style is not practiced at the organisation. In conclusion, a mixed of leadership style (democratic, autocratic, transformational and transactional leadership styles), depending on the situation, is the most appropriate. It was therefore recommended that the mix of democratic, autocratic, transformational and transactional leadership styles should be implemented but with due consideration to the situation and nature of the tasks assigned to the employees.

CHAPTER ONE

INTRODUCTION

1.1 Background of Study

Business environment today is changing radically as a result of major societal forces. Technological advances, globalization, consumer awareness and competition are having a great impact on organisational performances and creating new leadership styles and challenges. Businesses are constantly in search of the right leader who would take the organization into the next level of greatness and profitability.

Thus the interest in understanding the nuances of various leadership styles and its impact on employees’ performance has caught the attention of researchers over the past several decades. Although many factors may influence the performance of an organisation, it is clear that the quality of leadership is one of the most critical determinants of ultimate success. Leaders and the leadership styles play critical role in accomplishment of organisation goals and boost employee performance.

Leaders are perceived as persons who can create order out of chaos, direct organizations path or course through unthinkable environmental instability and bring mightiness out of mediocrity. They are also found to influence followers in many ways: coordinating, training, communicating, motivating, and rewarding (Yukl, 1989) through their leadership styles.

Leadership style is the behaviour and techniques used by the leaders to give vision and roadmap to reach the vision, formulations and executions of strategies and plan (House &Aditya, 1997).  Thus, a good leadership style accelerates the development of most organizations. However, organizational goals can never be achieved without proper leadership styles. It is important to note that the effective performance of an individual employee is a function of both his personal characteristics and the individual environment.

Therefore, it plays a critical role in the performance of organisations. Jamaludin’s (2011) research on leadership styles have suggested that effective leaders are those who use their powers for betterment of the followers and organization as well.  According to Raelin (2011) leadership is directly related to the practices to which people are dedicated. The most substantial of leaders is their influential personality that has positive relation with the follower’s work performance (Lian et al, 2011).

Leadership styles encompass a consistent combination of individual behaviors and attitudes towards group members in order to achieve goals (Bass and Bass, 2009). Obviously, every leader in their management and operations uses a particular leadership style in the organization; thus, in the competitive world with technological changes within the business environment, it is vital that organisations employ leadership styles that enable them to survive in a dynamic environment (Maritz, 1995; Bass, 1997).

However, “(Stogdill, 1974), highlighted two central factors to leadership: “Initiating Structure” and “Consideration”. Initiating structure addressed task behaviours, which served to fulfill duties whereas consideration represented relationship behaviours, which aided to build leaders-followers links. Tasks behaviors are important for the day-to-day survival of the organisation, while developing people and team relationship are important for the long-range performance of the organisation. Great leaders are both task and people orientated, while poor leaders become fixated on one or the other. It is extremely important to balance the ability to get things done (tasks) with keeping the team together (people).

Leadershipstyle encompasses a consistent combination of individual behaviors and attitudes towards group members in order to achieve goals (Bass and Bass, 2009). Obviously, every leader in their management and operations uses a particular leadership style in the organization; thus, in the competitive world with technological changes within the business environment, it is vital that organisations employ leadership styles that enable organisations to survive in a dynamic environment (Maritz, 1995; Bass, 1997).

Many leadership theories have been proposed in the last 50 years, which are claimed to have influenced the overall effectiveness of the organisations. These theories explain the leadership process in different ways (Bass & Bass, 2009). Among these leadership theories are, trait theory, behavioral theory and contingency theory, which are called traditional theories of leadership, while transformational and transactional theories are called new leadership theories. Current leadership theories describe leaders based upon trait or how influence and power are used to achieve objectives. When using trait-based description, leaders may be classified as autocratic, democratic, bureaucratic or charismatic, while viewing leadership from the perspective of the exchange of power and its utilization to secure outcomes; leaders are situational, transactional or transformational.

Understanding the different aspects can provide a vocabulary for discussion that can lead to meaningful and desired result. In addition, identifying an individual leader style is central to evaluating leadership quality and effectiveness especially as it’s relates to organizational goal. In every organization, organizational effectiveness depends heavily on the leadership. Thus scholars have different views about the effectiveness and role of leaders in organizational success and failure, but most of these scholars agree that leaders and their leadership styles play a vital role in organizational success. An important aspect of organisational leadership can be evaluated from employee performance, which is an extremely vital criterion that determines organizational successes or failures.

On the other hand, employee performance is an important building block of an organization and factors, which lay the foundation for high performance, must be analyzed by the organizations. Organization progress by depending on collective effort of all the members of the organization. Performance is a major multidimensional construct aimed to achieve results and has a strong link to strategic goals of an organization (Mwita, 2000).

Pattanayak (2005) states that performance of an employee is resultant behaviour on a task, which can be observed and evaluated. To him, employee performance is the contribution made by an individual in the accomplishment of organizational goals. Here employee performance is simply the result of patterns of action carried out to satisfy an objective according to some standards. This means employee performance is a behavior, which consists of direct observable actions of an employee, and also mental actions or products such as answers or decisions, which result in organizational outcomes in the form of attainment of goals. Many companies assess their employee’s performance on an annual or quarterly basis in order to define certain areas that need improvement.

Now with this understanding, an effective leadership program can be of an immense assistance to help identify and build leadership qualities among individuals within an organization. The relationship between leadership and performance was indirect as well as direct (Gadot, 2007), which proves the importance of developing leaders through leadership development programs. Latest studies suggest that organizations heavily invest in human resource development interventions and skill the employees need in order to attain employee performance and job satisfaction.

These skills can be impacted by providing necessary technical/non-technical training and coaching (Rowold, 2008). Currently leadership is widely recognized, and verified through research. Leadership development can be impacted through experiential learning, vicarious learning and transformational learning and it is impacted as leaders can influence the people and motivate them (Popper, 2005). According to Adei (2003), for organisation to move forward, there should be in place effective leadership styles that are critical for improving performance and productivity in an organization.

Performance is an increasingly important concern for GHSS, who’s focus, is on staff performance and staff retention (GHSS article 2013). The GHSS was established as a consulting firm for non-governmental organization and is dedicated to seeking innovative solutions to strengthen health systems in developing countries for effective service delivery and surveillance of infectious, non-infectious, and neglected tropical diseases. GHSS believes that leadership styles is a major consideration and challenge across the globe and has a major influence on employees’ performance. In view of this, the study would establish the leadership styles that are exhibited at GHSS and find out how these leadership styles are linked to the performance of its employees.

However instead of concentrating on a single leadership style, leaders can vary their approaches depending on three factors: forces in the leaders, forces in the subordinates and forces in the situation. An effective leader is measured by his ability to manage and withstand forces around him and how to effectively utilized human and material resources to attain organizational objectives. Douglas McGregor put it clear that there is a close relationship between leaders’ expectation and the resulting performance of subordinates. He further explains that if leaders’ expectations are high, performance and productivity will be high.

1.2 Problem Statement

The centrality of this study is that, we often think a manager or leader is expected to exhibit a right behaviour towards employees or subordinates. Yet it is realised that in most organisations, there is inflexibility in the leadership styles of most leaders, and yet decisions and policies are imposed on subordinates.

These leaders failed to adjust their leading style to the changing situation of the business environment and this failure is due to the lack of understanding that no particular leadership style can fit all situation and must be flexible to give room for change. Because of this, for effective and efficient organisations leadership, the style must be critically looked out for the performance of employees. The objective of this study is to establish leadership styles and to determine how it affects the performance of employees.

Also, some studies such example Peterson, Smith, Martorana, & Owens (2003) suggest that leadership styles are critically important for an organization to achieve a high level of employees’ performance whereas other studies, such as Meindl, Ehrlich &Dukerich (1985) suggest that leadership styles are not so important in achieving employees’ performance as well as organizational performance. Therefore, these contradictory findings about the leadership styles and employee performance justify the need for the study.

In the context of this situation, this study seeks to provide answers to the main research question, on how leadership styles impact employee performance at Global Health Systems Solution and the following specific questions;

1. What are the leadership styles practiced by Global Health System Solution?
2. How does the leadership style practiced by Global Health Systems Solution affect employee performance?

1.3 Research Objectives

The main goal of this study is to determine how leadership styles affect employee performance in the Global Health Systems Solution. Specifically:

1. To determine the leadership styles practiced by the Global Health Systems Solution.
2. To examine how the leadership styles practiced by Global Health Systems Solution impact on workers’ performance.
3. To make recommendations on how the leadership styles of GHSS can be improved upon so as to increase employee’s performance.

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