Employees’ readiness for change: The role of employees’
needs and supervisors’ leadership styles
Employees’ readiness for change: The role of employees’
needs and supervisors’ leadership styles
B.M.J. VAN HANNEN
Rijksuniversiteit Groningen Faculty of Economics and Business
MSc Business Administration – Change Management MSc Human Resource Management
ABSTRACT
This research, conducted among 149 employees of a large international organization, examines the influence of employees’ needs on their, readiness for change, and the moderating role of supervisors’ leadership styles. This research focuses on three employee needs (i.e., need for motivating power, need for structure, and need for empowerment) and three leadership styles (i.e., transformational leadership, transactional leadership, and participative leadership). It is expected that the three employee’s needs will have a negative relationship with change readiness. In addition, this study predicts that the relation between needs and change readiness is moderated by the leadership style. Unfortunately, results do not match our expectations. Instead analysis revealed that, transformational leadership, transactional leadership and participative leadership positively influence employees’ readiness for change. The different styles have no moderating influence on the relationship between the need and change readiness but all three have direct impact on change readiness.
Key words: change readiness, employee needs, leadership style.
PREFACE
The master thesis that is lying in front of you is the result of five months intensive research. In February 2014, after a theoretical study period I decided that it was time to orientate myself more practical. I planned to write my master thesis as an intern at a large organization. While applying, I became more and more enthusiastic and fortunately the good news came in June. I had the opportunity to write my thesis at KPMG headquarters. Before I knew it my first day had begun. It was a fantastic period and I learned a lot about both, research and practice. Especially during the first few weeks, it was difficult to find the right topic that would cover change management and human resource management, and would match with my interests. Many brainstorm sessions later I ended up with a subject I was really interested in and that excited me every day. My research was about employees’ readiness for change in large change projects. It was disappointing to find no direct evidence of the proposed relationships in my research. Still, I learned a lot from this research
and the energy I have put into it, was definitely worth it as I also received a lot of energy in return.
I would like to take the opportunity to thank a number of people. First of all, I would like to thank my two supervisors: Hanneke Grutterink and Sanne Feenstra. Without your enthusiasm and support I would never have finished this research on time. You both gave me guidance during the process and you always responded quickly and extensively. Even though your views were very critical, your feedback was always very helpful to me. Thank you for that. I also would like to thank Chantal Dekker for her supervision, input and feedback. You did not only help me structure my writing process but you also made me enthusiastic about applying theory to real business cases. Because of you I was involved in many areas of the organization and you showed me that it is possible to successfully apply theory to practice. Next to Chantal I would like to thank KPMG and the People & Change department for giving me the opportunity to come and joint them in their daily practices. I had a great time and I look forward to working with you. In addition, I would like to thank Marnix van Deursen for the encouragement you gave me. Finally, I would like to thank my parents because they made everything possible for me during my studies. Not only by offering financial aid but also by offering me complete freedom to do what I wanted during my studies You have always supported me.
Babeth van Hannen Amstelveen, January 2015
TABLE OF CONTENTS
INTRODUCTION ... 7
THEORETICAL FRAMEWORK AND HYPOTHESES ... 11
2.1 Readiness for Change and Employees’ Needs ... 11
2.2 Need for Motivating Power and the Moderating Role of Transformational Leadership .... 13
2.3 Need for Structure and the Moderating Role of Transactional Leadership ... 15
2.4 Need for Empowerment and the Moderating Role of Participative Leadership ... 17
METHODOLOGY ... 20
3. 1 Data collection and sample ... 20
3.2 Measurement ... 21
3.3 Analysis ... 23
RESULTS ... 25
Descriptive Statistics ... 25
4.1 The Need for Motivating Power and the Transformational Leadership Style ... 27
4.2 The Need for Structure and the Transactional Leadership Style ... 27
4.3 The Need for Empowerment and the Participative Leadership Style ... 28
DISCUSSION ... 30
5.1 Main findings ... 30
5.2 Limitations and recommendations for further research ... 32
5.3 Theoretical implications ... 33 5.4 Practical implications ... 34 5.5 Conclusion ... 34 REFERENCES ... 36 APPENDICES ... 44 APPENDIX A: SURVEY ... 44
APPENDIX B: SURVEY SCALES ... 48
APPENDIX C: CORRELATION TABLE CONTROL VARIABLE ... 56
FIGURES AND TABLES
Figure 1, p. 15: Conceptual model 1.0 The Need for Motivating Power and the Moderating Role of Transformational Leadership Predicting Readiness for Change.
Figure 2, p. 17: Conceptual model 2.0: The Personal Need for Structure and the Moderating Role of Transactional Leadership Predicting Readiness for Change.
Figure 3, p. 19: Conceptual model 3.0: The Need for Empowerment and the Moderating Role of Participative Leadership Predicting Readiness for Change.
Table 1, p. 21: The modified scale for the need for motivating power
Table 2, p. 26: Means, standard deviations and Pearson correlations between used variables
Table 3, p. 27: Hierarchical Linear Regression of Change Readiness on Motivating Power and Transformational Leadership
Table 4, p. 28: Hierarchical Linear Regression of Change Readiness on Need for Structure and Transactional Leadership
Table 5, p. 29: Hierarchical Linear Regression of Change Readiness on Need for Empowerment and Participative Leadership
INTRODUCTION
The complexity of social, economic, legal and technological changes has made change projects an integral part of daily business (Greenwood & Hinnings, 1996; Kellerman, 2007). This implies that, organizations need to respond to these changes in order to effectively cope with fast changing contextual forces. The capacity of coping with these changing forces is an important determinant in creating a competitive advantage, for an organization’s survival (D’ Aveni, 1995; D’Avemi, 2010; Fullan, 2011). Research shows that most change projects fail as 70% of all projects do not achieve their objectives (Bashein, Markus & Riley, 1994; Sirkin, Keeman & Jackson, 2005).
Research also shows that employees are the most important determinant of success during a change project (Vakola & Nikolaou, 2005; Kotter, 1995; Shum, Bove & Auh, 2008). Their reactions and attitudes are often decisive during a change project, such that without commitment and adaptations of employees success rates are low (Kotter, 1995) However, not every employee has the same feeling about a project and, their needs can differ significantly. For example, some employees prefer close involvement, active participation and a certain sense of empowerment, where others prefer a clear change (Yun, Cox & Sims, 2006). It is important that employees are willing as these projects require their involvement. Readiness for change is therefore essential during a change project.
Change readiness describes an individual’s attitude, belief and intention towards a change project. Due to the important role of the employees in organizations, the employee’s change readiness has a significant impact on the outcome of a project (Bartunek, Rousseau, Rudolph & DePalma, 2006). This means that every organization needs a certain degree of readiness to create followership and commitment (Armenakis, Harris, & Mossholder, 1993) necessary for the creation of a successful change (Sirkin, 2005). It is interesting to note that, despite the importance of readiness, little is known about the antecedents of employees’ readiness for change. This explains the legitimacy of this research as it focuses on the needs of employees and the prediction of their readiness for change. Moreover this study will examine how leaders can influence their employees’ readiness for change as it is crucial for organizations to know what skills and characteristics of al leadership style match best with the employees’ needs. The following research question is formulated:
Do specific follower needs influence the individual readiness for change and is this relationship moderated by leadership styles?
This study will especially focus on three different needs: (1) need for motivating power, (2) personal need for structure and (3) need for empowerment. The choice for these particular needs is based on existing academic literature. These needs can be mapped on to the leadership styles, that is useful because this creates a link with leadership research.
First, need for motivating power refers to the amount of motivation that an employee needs from his or her leader. Motivation as a need is derived from a claim in the article of Wiley (1995). He states that motivation is not an obvious trait. But, “It refers to a dynamic internal state resulting from the influence of personal and situational factors” (p. 263). As such, an employee may have the need for motivating power from the environment or from the leader. When an employee is self-motivated to his work this does not necessarily mean that the employee is also self-motivated to work on a change project. Changes can alter work in such a way that their motivation also changes. It is clear from the literature that motivation is essential to the success of a change project (Kotter, 1995). “Without motivation, people won’t help and the effort goes nowhere” (Kotter, 1995, p.60). This statement of Kotter is related to employees’ readiness for change because their attitude, belief and intention affect the amount of motivational power of the leader that is needed. Need for motivating power is relevant because in order to achieve a successful change project, the staff should be at least as enthusiastic as the leaders (Kouzes & Posner, 2011). Regarding to this relatively new item, the expectation is that there is a negative relationship between the need for motivating power and the change readiness of an employee.
Second, the need for structure is cited in the literature of Thompson and colleaus (2001). They suggest that change projects give rise to uncertainties and fragilities. Therefor some followers become aware of their personal need for structure, because of the unnatural character of change, structure is an important aspect. Yet, employees may differ in their preference for structure. As such, it will be interesting to measure this need and investigate whether it is negatively related to change readiness, as this study expects.
Finally, need for empowerment refers to an employee’s call to four cognitions: a sense of meaning, competence, self-determination, and impact (Thomas & Velthouse, 1990). These dimensions represent the essence of empowerment. Today many people are highly educated and have easy access to all sorts of information which they want to use to provide input. The need for
empowerment is an emerging need and therefore it is interesting to examine whether there is a negative relationship between this need and the readiness for change.
It is remarkable that, the existing literature give little attention to the relation between employee’s needs and the influence of a particular leadership style on the change readiness, although the concepts leadership and change are currently inseparable. In this research, this important relation is exposed. Research has shown that the success rate of a change project is influenced by the employees’ response to the project – their response, however, depends on whether or not their existing need has been addressed. The leader is very important during a change project and a good leader can be a key to success. At the same time it must be stated that leadership during a change project can be difficult (Yukl, 2010). In line with the claim of Higgs and Rowland (2000), leadership can be seen as a suitable instrument to increase employees’ readiness for change. However this is only true when the applied leadership style matches the specific needs of the employees. Each leadership style has its own properties. As such, the styles differ in applicability, depending on the situation and the needs on the work floor. Leaders must be aware of the fact that not all employees will react in the same way.
This study will elaborate on three different leadership styles. The first style is known as the transformational leadership style. The use of this style enables a leader to influence his/her employees by communicating a vision while, at the same time, recognizing the employee’s feelings (Bass, 1985; Podsakoff, MacKenzie, Moorman & Fetter, 1990). A transformational leader recognizes the employees’ needs, for example the need for motivating power. In general, this style can be seen as one of the most successful ways of approaching people during a change situation. Therefore it is expected that this style moderates the negative relationship between the need for moderating power and the change readiness, in such a way that this relationship is only negative when transformational leadership style is low. The second leadership style is known as transactional leadership style and refers to more task-oriented factors. According to Burnes (1978) it represents an exchange relation between the leader and the employees. The mutual expectations are clear and the main focus is on the tasks that need to be performed. There is a certain structure and in regard to this it is expected that the negative relationship between the need for structure and change readiness may be influenced by the transactional leadership style. Finally, participative leadership refers to joint decision making (Koopman & Wierdsma, 1998). This type of leader does not define what should be done and how. A participative leader creates a framework within the
employees can function optimally and it stimulates them to take initiative and come up with new ideas (Druskat & Weeler, 2003). In this way a leader can empower his employees. It is also expected that the negative relationship between the need for empowerment and the readiness for change may be influenced by the participative leadership style.
This study will extend the findings of prior research in several ways. First, I will examine what needs influence employees’ readiness for change. This research is one of the first to examine readiness for change from the perspective of the employee. Most of the change literature has focused on the role of leader’s and supervisor’s for employee’s readiness for change (Bass, 1985; Avolio, Walumba & Weber, 2009). This is remarkable considering that research has shown that the readiness and attitudes of employees play a key role in the success or failure of change projects (Bartunek et al., 2006). Second I will examine the moderating role of leadership styles for the relationship between employees’ needs and readiness for change. Today, little is known about how leaders can influence employees’ needs and readiness for change. Existing research only highlights leadership styles in change, whereas insights of the influence of leadership styles of the needs of employee’s are missing (Ford, Ford & Polin, 2014). The results of this study will therefore contribute to the development of the academic literature, by adding the followers and employees perspective. More knowledge about these perspectives will also contribute to a better understanding and applicability of existing leadership literature.
THEORETICAL FRAMEWORK AND HYPOTHESES
This chapter provides further explanation regarding the concepts discussed in the introduction. First, readiness for change and employee needs are defined. Second, employee’s needs and their relationship with readiness for change will be explained. Additionally, the expected effects of leadership on the relationship between needs and change readiness will be discussed.
2.1 Readiness for Change and Employees’ Needs
Employees’ past experiences and their perceptions of the organization provide some preconceived notions about change (Bovey & Hede, 2001). Experiences and perceptions exist over time and they are also likely to evolve over time. Each employee has a unique interpretation of the environment and organizational context. It is therefore conceivable that, within the same organization, employees may hold different perceptions of a similar situation (Spreitzer, 1996).
The readiness for change suggests that the perceptions and experiences are indicative of the organization’s capacity of making successful changes. The broad construct readiness for change consists of an individual’s attitude, belief and intention towards a change project (Armenakis et al., 1993). This readiness for change closely resembles a followers’ mindset for change implementation or, as Lewin (1951) notes, the concept of unfreezing. This process of unfreezing means that the mindset of an organizational member about change is altered in such a way that he or she observes the change as essential and valuable. However, readiness for change is more exactly defined by Armenakis and colleagues (1993, p.683) as “the cognitive precursor to the behavior of either resistance to, or support for a change effort”.
Holt and colleagues define change readiness as “a comprehensive attitude, that is influenced simultaneously by the context (i.e., what is being changed), the process (i.e., how the change is being implemented), the context (i.e., circumstances under which the change is occurring), and the individuals (i.e., characteristics of those being asked to change) involved” (Holt, Armenakis, Field & Harris, 2008, p.235). It is a reflection of change acceptation. Hence, change readiness reflects to what extent employees will go along with the change project. This is also the definition used in this study.
In this study, the individuals will be represented by employees. Change readiness of employees is an important determinant in the implementation and success of a change project
(Bartunek et al., 2006; McManus, Russell, Freeman & Rohricht, 1995). Studying readiness for change also emphasizes the importance of the employee in the implementation process. There must be readiness for change to ensure that employees will join change actively.
Reactions of employees’ towards change can differ significantly, which is partly due to individual needs. Social, economic, legal and technological changes influence employees’ needs and because of the continuity of change in organizations, their needs at work also apply in change projects. General needs op employees can be understood in different terms such as autonomy, competence and feelings of relatedness (Hetland, Hetland, Andreassen, Pallesen & Notelaers, 2011). Needs can be considered as necessities that provide proactivity and optimal development (Deci & Vansteenkiste, 2004).Change projects cause doubts and uncertainties and in such situations people attach more value to certainties and their psychological needs (Atkinson, Crawford & Ward, 2006).
Much is written about individual needs at work. McCallaster (2004) recognized that people experience change projects in different ways, which lead to different needs among employees. There are lots of needs, each with own characteristics. Due to these differences they have various effects within the organization. It is interesting to gain more insight into the effects of the extent to which leaders fulfill employees’ needs. Previous research has found that fulfilling a need increased job satisfaction significantly (Haivas, Hofmans & Pepermans, 2013; Van den Broeck,
Vansteenkiste, De Witte & Lens, 2008).
As mentioned earlier, three different needs are selected for this research: (1) need for motivating power, (2) need for structure and (3) need for empowerment. It is important to emphasize the difference between need for motivating power and need for empowerment. The most important difference is explained by the definitions. The needs are mutually exclusive, need for motivating power is about someone’s need to be motivated to work in a change project and need for empowerment refers to an employee’s need to increase his participation. It may happen that an employee needs a lot of motivating power of its leader because this person did not see the benefits of the change project. This differs from need for more empowerment. The employee can be satisfied with the level of empowerment but at the same time he can still have a need for motivating power.
2.2 Need for Motivating Power and the Moderating Role of Transformational Leadership In general employees do not prefer change because it feels unnatural to them (Gill, 2002). They misunderstand or disclaim the effects of the change project for their individual commitment within the organization (Strebel, 1996). In addition, it is crucial that the employee is enthusiastic and motivated about the change project. Many motivating factors can be identified, such as recognition, responsibility and growth (Herzberg, 1966). In many cases it requires a fair amount of motivating power provided by the leader to get the employees both motivated and enthusiastic. Because of the unnatural character of change an extra need for motivation will exist. Due to the exemplary role of the leader a certain expectation and need may arise in uncertain situations (Kouzes & Posner, 2010). The need that arise can be defined as the need for a strong force by which a leader motivates his employees. In this study need for motivating power refers to the motivating power of a leader to take his employees into the change project.
Strong motivating power has a real long-term positive effect on employees (Banks, 1997). It is expected that high unmet need for motivating power will have a negative effect on the change readiness. When employees need the motivating power of their leader to go along with the change, their mindset towards the change implementation is not ideal. This will influence the change acceptation negative and thereby the change readiness. Therefore, it is predicted that individuals with a high need for motivating power, dislike change and their change readiness can be considered as limited. In other words, we predict a negative relationship between need for motivating power and change readiness. Based on this the following hypothesis is proposed:
H1: There is a negative relationship between an individual’s need for motivating power and an individual’s readiness for change.
Despite the different motivating factors, transformational power of a leader is most important to ensure a kick-start in a change project (Eisenbach, Watson & Pillai, 1999). Transformational leadership must establish a sense of urgency and create a context for change in combination with interesting outcomes for employees. Kotter (1995) states that employees become more motivated when the sense of urgency is clearly defined and actively stimulated by the leader. Transformational leadership style seems a great instrument in order to achieve this and to fulfil the need for motivating power.
motivation and the leadership style. Transformational leadership evokes strong reactions from employees. This means that they will be more inclined to put some extra effort in the project (Thrash & Elliot, 2003). Transformational leadership is based on exhibited behavior of the leader. This behavior should make employees more aware of the importance of change and it must ensure willingness to work for organizational interests (Yukl, 2002). It implies the extent to which a leader is able to influence their employees by communicating a new vision. This type of leader is also able to recognize employees’ individual needs, transfer their beliefs and attitudes and stimulate their intellectual development (Bass, 1985; House, 1977; Podsakoff, MacKenzie, Moorman & Fetter, 1990). The focus of transformational leadership is on the followers’ well-being and personal feelings.
This is in line with the above mentioned information and means that the leader is able to influence his or her employees. This capacity is in line with the need for motivating power. The exemplary behavior of a transformational leader can fulfil this need. Employees with a high need for motivating power need to be convinced of urgency, stimulated by the leader (Kotter, 1995). Another connection between the two aspects is the component formation of cohesion among employees to pursue goals set by the leader (Podsakoff, et al., 1990). Need for motivating power reflects that some employees need motivation from their leader to become just as excited about the change project as the leader himself. Important words within the definition of the concepts are influence, transfer and stimulate. Therefore it is expected that especially people with a need for motivating power will benefit from this leadership style. This research states that a leader can be able to respond to this need by using the transformational leadership style. Here, the expectation is that readiness for change of a particular individual increases when the need for motivating power is fulfilled. In this situation they are aware of the urgency and are willing to work in accordance with the new method. Based on this the following hypothesis is proposed:
H2: The relationship between the need for motivating power and the readiness for change is moderated by leaders’ transformational leadership style, such that his relationship is negative when the transformational leadership style is low.
FIGURE 1
Conceptual model 1.0 - The Need for Motivating Power and the Moderating Role of Transformational Leadership Predicting Readiness for Change.
2.3 Need for Structure and the Moderating Role of Transactional Leadership
Within the social environment much information is available and technological changes and developments continue rapidly. This results in an information overload in which an individual needs to bring more structure. Due to all different reactions and attitudes it is argued that each individual will structure this in a unique way and develops his own need for structure. A similar situation exists in the workplace. Change programs often introduce several new aspects and information and each employee will respond differently. Need for structure is cited in the literature of Thompson et al. (2001). The researchers suggest that change projects give rise to uncertainties and fragilities. Therefore some followers become aware of their personal need for structure. Therefore, need for structure refers to the need of clarifying situations and structuring information. In this study the need for structure refers to an employee’s desire for simple structures and routines (Neuberg & Newson, 1993).
There are differences in the desire of employees for simple structures. These differences may influence important factors like reactions and the way employees see their environment (Neuberg et al., 1993). Followers with a high need for structure prefer clearly defined situations without uncertainties (Thompson et al., 2001). Change projects are the opposite of clearly defined situations. Regarding to an individual’s readiness for change it is expected that a high need for structure ensures a lower change readiness because the required structure disappears. Change
Readiness for change
Transformational leadership style The need for motivating
power
projects ensure uncertainties and it is expected that this will influences the attitudes and perceptions towards change in a negative way. Due to the uncertainty reticent behavior is expected in relation to the change project. Based on this the following hypotheses is proposed:
H3: There is a negative relationship between an individual’s need for structure and the individual’s readiness for change.
Transactional leadership seems a great tool as it can help to provide some structure. Transactional leadership refers to a more task-oriented work method which is in contrast to instinctive transformational style. According to Burnes (1978) it represents an exchange relation between the leader and his employees. Within this style the leader clarifies what is expected from the employees, and in return employees must accept several performance criteria. Hereby the reward often depends on employees ‘achievements and the focus is much more on performance (Lord, Brown & Freiberg, 1999; Hamstra, van Yperen, Wisse & Sassenberg, 2013). In general, it seems that all theories around the transactional leadership style are based on a range of exchanges or implicit negotiations between leader and employee (Hartog et al., 1997).
The exchanges listed above are predetermined and there is a certain structure. A transactional leader creates clear conditions and employees know what is expected. This provides more clarity which is helpful for employees with a high need for structure. It may help them to cope with the uncertainties of a change project. Thereby transactional leadership leads to some extra effort of employees which can have a positive influence on the relation between the need and change readiness.
In this study it is expected that a transactional leader can provide guidance by offering more structure in uncertain situations. A leader can respond tactically to the personal need for structure and by doing this he can increase the change readiness. Following this, the next hypothesis is addressed:
H4: The relationship between the personal need for structure power and the readiness for change is moderated by leaders’ transactional leadership style, such that his relationship is negative when the transactional leadership style is low.
FIGURE 2
Conceptual model 2.0 - The Need for Structure and the Moderating Role of Transactional Leadership Predicting Readiness for Change.
2.4 Need for Empowerment and the Moderating Role of Participative Leadership
Another important need that is addressed in this research is need for empowerment of individuals. Workers want to perceive some ‘freedom’ in how they carry out their work. Spreitzer (1995) suggest that empowerment consist of four dimensions identified as meaning, competence, self-determination and impact. Meaning refers to ‘the value’ of work. Competences are knowledge and skills that individuals possess to deliver high performance. Self-determination relates to a piece of autonomy and choice in performing the task. Impact refers to the amount of influence an individual has on his or her tasks. Need for empowerment refers to the degree of autonomy and freedom experienced by employees in performing their work. Empowerment becomes increasingly important due to global competition and complexity (Drucker, 1988). It is interesting to note that there has been little growth in the area of empowerment despite the fact that this is very important to employees.
Empowerment can be seen as an important aspect because of its influence. Today, employees will not be committed when they are constantly monitored or in situations with a lot of top down control (Argyris, 2001). As Spreitzer (1995) claims, empowerment is among other related with impact and meaning. Employees want to contribute to decisions and share their ideas. When they need to participate in a fully developed change project their need for empowerment
The personal need for structure
Transactional leadership style
Readiness for change
will influence the acceptance of the change project and thereby their change readiness. With regard to change readiness of an employee the following is expected. When an employee has a low need for empowerment he probably dislikes change projects. It is expected that most of these people also dislike participation and are satisfied with the status quo. It seems that employees with a low need for empowerment see changes often as unnecessary. Based on this the following hypotheses is proposed:
H 5: There is a negative relationship between an individual’s need for empowerment and the individual’s readiness for change.
Most leaders undermine the phenomenon of empowerment. In theory, leaders are enthusiastic about empowerment. However, in practice they are afraid of losing control and do not go into action. They stick to the command-and-control model, because this is familiar to them (Argyris, 2001). Herzberg (1986) concluded that management often fails to enrich jobs. The result of their actions are often a reduction of the individual contribution of employees instead of creating opportunities and increase empowerment.
A leadership style that fits well with this need is the participative leadership style. Koopman & Wierdsma (1998) define this style as joint decision making, which requires at least some room for ideas and influences of employees during the decision making process. Leader and employee cooperate in several relevant processes. Followers are asked for suggestions and ideas and besides that there is a lot of contact and consultation between all parties involved. In this way, employees have the opportunity to discuss their issues and/or influence organizational decisions (Somech, 2005). Key words in the participative leadership style are participation and empowerment. The main purpose is to get to a situation in which employees translate the organizational objective into their own objectives. A useful instrument that could support achieving this would be delegating responsibilities in order to end up with higher organization performance (Stewart, 2006).
There is a logical connection between need for empowerment and participative leadership style. Employees want to experience some freedom in their work just as they want to be enabled to deliver value and make an impact (Wrzesniewski & Dutton, 2001). The participative leadership style is applicable because of these characteristics. This type of leader involves people during the generation of new ideas. They may be seen as proponents of the cooperation between the leader
Readiness for change The need for
empowerment
Participative leadership style
and his employees. Cooperation ensures that responsibilities can be transferred and the need can be easily fulfilled. The employee gets the idea that he delivers valuable work and becomes empowered to make impact. The need for empowerment in fulfilled by the participative leadership style. A successful participative leader will be able to ensure that his employees are satisfied. This means that there is less negative impact on the change readiness because the participation level fits within the need for empowerment. The next hypothesis is addressed in accordance to the information above mentioned:
H 6: The relationship between the need for empowerment and the readiness for change is moderated by leaders’ participative leadership style, such that his relationship is negative when the participative leadership style is low.
FIGURE 3
Conceptual model 3.0 - The Need for Empowerment and the Moderating Role of Participative Leadership Predicting Readiness for Change.
METHODOLOGY
3. 1 Data collection and sampleIn order to find an answer to our research question an empirical study was conducted using an online questionnaire. The data needed for this study were collected at a large multinational in the Netherlands. The organization is market leader in the complementary areas audit, tax and advisory services. In the Netherlands, a total of 2915 people are working for this organization, spread across twelve offices. More than 1,700 people work at the headquarters in Amstelveen which is the location where this research took place. The group of respondents consists of 66% female and 34% male employees. The organization is engaged in the implementation of a major internal change project. This change project guides several internal changes, which were based on seven workflows. All these workflows focus on different topics within the organization and many employees were involved in the implementation of the project. The project is the companies response on internal and external critics on existing work methods and should restore the trust in the organization.
The survey was only sent to followers within the organization as this study is explicitly focused on the followers’ perspective of readiness for change. The survey (see appendix A) was carefully constructed and tested in advance on applicability and usability. The items from the survey were individually discussed with ten people from within and outside the organization. Hereafter, employees of the advisory management consulting branch were approached by email and asked for co-operation in this research. A reminder followed after one week. The choice for this branch is based on accessibility and because its considered as representative for a large part of the organization. In addition, the department was largely involved in the change process by dialogue sessions with leaders and the right to provide feedback and ideas.
The questionnaire was sent to a total number of 420 employees. Eventually149 respondents completed the whole survey which resulted in a response rate of 35.5%. The final sample consisted of 99 (66.3%) male and 50 (33.7%) female employees. It is interesting to note, that most respondents can be placed in two age-categories. Seventy (47%) respondents were between, 25 – 34 years old and forty (27%) respondents were between, 35 – 44 years old. From the other respondents, nineteen (13%) were between, 45 – 55 years old, eighteen (12%) were younger than 25 and only two of them (1%) were older than 55 years old. Most of the participants were Dutch
(95.3%). Except two employees from Germany and one employee from Turkey, Ireland, Romania, South-Africa and India.
3.2 Measurement
Several measurement scales were adapted to the particular work field to improve the applicability of the questionnaire. Furthermore, the size of the questionnaire was taken into account, for the reason that a long survey is negatively associated with the response rate (Burchell & Marsh, 1992). All measures were rated on a 5-point Likert-scale ranging from 1 (strongly disagree) to 5 (strongly agree).
Readiness for change was measured with the 12 items of Holt and colleagues (2007). Their
work is based on four factors that represent different themes, namely; appropriateness,
management support, change efficacy and personally beneficial. Sample items included: “ I think that the organization will benefit from this change” and “There are legitimate reasons for us to make this change”. The mean value for this variable was 3.92 (SD = .40), with a minimum of 2.83
and a maximum of 5.00. Cronbach’s α for this scale was .75.
Need for motivating power, was measured with an adjusted version of the 6-item scale for
transformational leadership from van der Kam et al. (2014). Table 1 depicts the original and modified version of the scale. The sixth item of the need for motivating power scale was removed, based on the fact that the Cronbach’s alpha should be higher than .60. The mean value for this variable was 4.04 (SD = .50), with a minimum of 2.60 and a maximum of 5.00. Cronbach’s α for this scale with the remaining five items was .74.
TABLE 1 The original and modified Need for Motivating Power scale
Original item Modified item
1. My supervisor inspires others with his/her plans for the future.
1. I need to be inspired by my leaders future plans.
2. My supervisor leads by example. 2. I need a leader who leads by example.
3. My supervisor develops a team attitude and spirit among employees.
3. I need the help of my leader in developing a team attitude.
4. My supervisor shows respect for my personal feelings.
4. I need a leader that shows respect for my personal feelings.
5. My supervisor has stimulated me to rethink the way I do things.
5. I need the encouragement of my leader to rethink the way I do things.
6. My supervisor will not settle for second best. 6. I need a leader who encourages me not to settle for second best.
Need for structure was measured with 6-items from Thompson, Naccarato & Parker
(1989). Sample items included: “I find that a consistent routine enables me to enjoy work more” and “I enjoy having a clear and structured way of work”. The sixth item of the need for structure scale was removed, based on the fact that the Cronbach’s alpha should be higher than .60. The mean value for this variable was 2.61 (SD = .67), with a minimum of 1.00 and a maximum of 4.20. Cronbach’s α for this scale was .79.
Need for empowerment was measured by the scale from Molleman, Nauta & Jehn (2004),
combined with Spreitzer (1995). In appendix B an overview is presented of all the original scale items of the survey and the final questions. Sample items included: “I like significant autonomy in
how I do my job” and “I find it important to be able to decide for myself what my end result will look like”. The sixth item of the need for empowerment scale was removed, because of a
Cronbach’s alpha higher than .60. The mean value for this variable was 4.01 (SD = .48), with a minimum of 2.80 and a maximum of 5.00. Cronbach’s α for this scale was .62.
Transformational leadership style, was measured by the 6-item scale from van der Kam
et al. (2014). Sample items included: “My supervisor leads by example” and “My supervisor
inspires others with his/her plans for the future”. The mean value for this variable was 3.69 (SD
= .64), with a minimum of 1.00 and a maximum of 5.00. Cronbach’s α for this scale was .84.
Transactional leadership style was measured by six items from the Multi-Factor
Leadership Questionnaire (MLQ) from Bass & Avolio (1996). It is a modified version, due to the difficulty of finding the whole copy of the questionnaire. The same accounts for the whole MLQ
applicable to transactional leadership and therefore the most appropriate section was used. It is a licensed-imposed patent so there was only access to part of the questions. Sample items included:
“My supervisor tells me what to do if I want to be rewarded for my work” and “My supervisor provides recognition when I reach my goals”. The mean value for this variable was 3.42 (SD =
.55), with a minimum of 1.67 and a maximum of 5.00. Cronbach’s α for this scale was .76.
Participative leadership style was measured with the 3-item scale from de Poel, Stoker &
Van der Zee (2014). Sample items included: “My supervisor consults with us, even on important
items” and “My supervisor gives his/her team members enough responsibility”. The mean value
for this variable was 3.52 (SD = .71), with a minimum of 1.30 and a maximum of 5.00. Cronbach’s α for this scale was .61. Appendix B provides an overview of the original scales.
Control variables. The age of the respondents was measured in five categories and for this
reason the average age is not known. Plan was to test the influence of both, nationality and gender. Because of the fact that 95% of the respondents were Dutch, it is not possible to perform this test. Participants’ gender was also considered as possible covariates because previous research has shown that there is a relation between readiness for change and gender (Madsen, Miller & John,, 2005). This study analysis the influence of gender but it does not influence results (see appendix C).
3.3 Analysis
Analyses were performed with help of the SPSS program. Cronbach’s alphas of all items scored >.60. Following this, combined variables were created. After checking the assumptions, such as the normal distribution, correlations and outliers it has been decided to remove the items 17 and 52. Then the standardized scores of the independent and moderator variables were calculated. Moreover, collinearity and the variation inflation factor (VIF) were calculated before the regression was performed. It is particularly important that the VIF is less than 4,0 or equal to 4,0. Otherwise the multi-collinearity between the corresponding variables is regarded as a problem (Field, 2009). In this study, VIF values were all roughly 1.0, implying that no problems were present.
The hypotheses are tested by the use of hierarchical linear regression analysis. The regression analysis was performed with standardized independent variables. In the first step of regression I implies the addition of the control variable gender. The second step contained the predictors, the need and the leadership style, to see the main effects of these variables. During the
final step we looked at the effect of the interaction between the employee need and leadership style.
RESULTS
The data set contained no specific outliers. Furthermore, we found all normal distributed variables. The normally distributed variables made it possible to carry out a regression analysis. The tables at the end of each section provide an overview of the important values that were applicable to the particular model. First we will discuss the normal distribution and the correlations.
Descriptive Statistics
The descriptive statistics and an overview of the correlations are depicted in Table 3. As predicted the need for motivating power correlates significantly with readiness for change (r = .23,
p < .01). Unexpectedly this is a positive relationship instead of the expected negative relationship.
The need for personal structure (r = .005, p > .01) and the need for empowerment (r = .064, p > .01) have no significant relationship with the change readiness.
In addition, the transformational leadership style correlates significantly with the change readiness (r = .34, p < .01). The transactional leadership style also has a significant relationship with the change readiness (r = .45, p < .01). Finally there is also a significant relationship between the participative leadership style and the change readiness ( r = .31, p < .01).
TABLE 2
Means, standard deviations and Pearson correlations between used variables
4.1 The Need for Motivating Power and the Transformational Leadership Style
Table 4 depicts the results of the hierarchical regression analysis to test the predictions of model 1. Contrary to our expectations, analysis revealed a positive effect of need for motivating power on readiness for change (∆R² = .17, ∆F = 14.51, p < .01) Remarkable is that the beta value indicates a positive relation while a negative relationship was expected (B = .09, t = 3.1, p < .01). This means that the first hypothesis was not supported. Furthermore, analysis revealed a positive effect of transformational leadership style for readiness for change ( B = .14, t = 4.49, p < .001). The second hypothesis stated that the relationship between need for motivating power and readiness for change would be moderated by leaders’ transformational leadership style. In the third step of our analysis, the interaction between need for motivating power and transformational leadership style did not contribute significantly to change readiness (∆R² = .18, ∆F = 1.01, p < .05). Hence, the second hypothesis is not supported (B = -.03, t = - 1.0, p < .05).
TABLE 3
Hierarchical Linear Regression of Change Readiness on Motivating Power and Transformational Leadership
** p < .01 *** p<.001
4.2 The Need for Structure and the Transactional Leadership Style
Table 5 depicts the results of the hierarchical regression analysis to test the predictions of model 2. There was no significant main effect of need for structure on change readiness (∆R² =
Model 1 Model 2 Model 3
R2 ,004 ,166*** ,006
β β β
Gender ,052 ,014 ,012
Need for Motivating Power ,093** ,091**
Transformational Leadership ,136*** ,147***
Need for Motivating Power x Transformational Leadership
-,034
.20, ∆F = 18.17, p > .01). Against the prediction, the component need for personal structure has no effect on the change readiness. The third hypothesis was not supported (B = .01, t = .28, p < .05). Furthermore, analysis revealed a positive effect of transactional leadership style for readiness for change (B = . 18, t = 6.03, p < .001).
Hypothesis four states that the relationship between the need for personal structure and readiness for change is moderated by leaders’ transactional leadership style. In the third step of our analysis, the interaction of the personal need for structure and the transactional leadership style did not contribute significantly to change readiness (∆R² = .21, ∆F = .28, p > .05). Hence, the fourth hypothesis is not supported ( B = .02, t = .53, p > .05).
TABLE 4
Hierarchical Linear Regression of Change Readiness on Need for Structure and Transactional Leadership
Model 1 Model 2 Model 3
R2 ,004 ,200*** ,002***
β β β
Gender ,052 ,023 ,023
Need for Structure ,008 ,006
Transactional Leadership ,178*** ,178***
Interaction ,016
** p < .01 *** p<.001
4.3 The Need for Empowerment and the Participative Leadership Style
for change (B = . 12, t = 3.9, p < .001).
Hypothesis six states that the relationship between the need for empowerment and readiness for change is moderated by leaders’ participative leadership style. In the third step of our analysis, the interaction of need for empowerment and the participative leadership style did not contribute significantly to change readiness (∆R² = .10, ∆F = .08, p > .01). Hence, the sixth hypothesis is not supported (B = .01, t = .20, p > .05).
TABLE 5
Hierarchical Linear Regression of Change Readiness on Need for Empowerment and Participative Leadership
** p < .01 *** p<.001
Model 1 Model 2 Model 3
R2 ,004 ,100*** ,001
β β β
Gender ,052 ,023 ,023
Need for Empowerment ,032 ,034
Participative Leadership ,124*** ,123***
Interaction ,008
DISCUSSION
This study aims to find out whether specific follower needs influence employee’s readiness for change and whether this relationship is moderated by leadership styles. Among the three employee needs, (i.e. need for motivating power, need for personal structure, and need for empowerment), only need for motivating power was associated with employees’ readiness for change. However, the relationship is not affected by supervisors’ transformational leadership, and although the influence was expected to be negative, results show a positive relationship. For the two other needs no relationship with change readiness was found. It is interesting to note that all leadership styles have a direct relationship with change readiness when they are viewed separately. It can further be stated that the leadership styles do not have the expected moderating effect.
5.1 Main findings
In this section, we will explain our main findings. For each model we will discuss two hypothesis and stress what we have found. First, we will discuss the need in relation with change readiness and then the moderating role of the leadership style will follow.
In accordance with previous research, the findings show that need for motivating power from the leader has a significant influence on a person’s change readiness. This result is also consistent with theory about the exemplary behavior of leaders. This theory suggests that employees often want to be motivated by someone from the top of the organization (Kouzes & Posner, 2010). As the results is not in line with the expected negative relationship, it suggests that employees who need strong motivation power of their leader are more willing to change than others. This could be explained by a docile nature of people with need for motivating power. This type of employees are strongly influenced by pressure from the society and they tend to adjust their behavior to expectations (Simon, 1995). They will be more willing to change when this is expected.
Motivating power of a leader has a strong long-term positive effect on employees. Stoker (2005) claims that leadership is primarily focused on change and making people want to act. This corresponds with the idea that a transformational leader is able to recognize employees’ individual needs and transfer their beliefs and attitudes (Bass, 1985; House, 1977; Podsakoff et al., 1990). You may expect that a leader with his motivating power is able to do this in a way that it is positive to the change readiness towards a project. However, in this study, no influence of the
transformational leadership style as a moderator is found. Although there is a relationship between the need for motivating power and change readiness it seems that this relationship is not affected by the transformational leadership style. This in contrast to the claim of Moorman & Fetter (1990) who argue that a transformational leader is able to identify and respond to the needs of his employees. The need for motivating power remains unanswered, and eliminates the influence of
the leader of the needs. However, a positive main effect was found from transformational
leadership on readiness for change. This is consistent with the claim of Eisenbach and colleagues (1999), that transformational power of a leader is one of the most important factors to ensure a kick-start in a change project. Although this relationship was not tested with a specific hypothesis, this claim is confirmed by the results.
Secondly, it was argued that followers with a high need for structure prefer clearly defined situations without uncertainties (Thompson et al., 2001). Here the expectation was that people with a high need for structure would have a low readiness for change, based on the uncertainties and fragilities associated with a change project (Thompson et al., 2001). This study shows that need for structure does not influence the change readiness. The impact on the reactions and the behavior of employees (Neuberg & Newson, 1993) does not affect someone’s change readiness. This was expected because Neuberg & Newsom argued that the differences in need for structure affect their reaction to the environment. Subsequently, it was expected that this will affect someone’s change readiness.
In order to meet an employees’ need for structure it seems that the transactional leadership style would be a great tool. This style represents an exchange relation between the leader and the employees (Burnes, 1978). It is based on the arrangement of exchanges or implicit negotiations (Hartog et al., 1997). Due to the clarity of this style it was expected that this could help employees with a high need for structure by increasing their change readiness. This expectation was not supported by the results. The clear expectations which can be associated with the transactional leadership style (Hartog et al., 1997) are not consistent with need for structure. The transactional leadership style only has a direct influence on the change readiness.
Thirdly, the need for empowerment have no effect on the change readiness. This study expects that people with a low need for empowerment also have a low readiness for change which is in line with the study of Argyris (2001). Employees with low need for empowerment are often satisfied with the status quo and do not have natural preferences for change. However, the results
of this study show that this assumption is not correct. The amount of the need for empowerment does not affect the changes readiness.
Employees with a need for empowerment do not see change projects as a chance to fulfill their need. The expectation was that a participative leadership style creates the opportunity for employees to generate ideas and fulfill their need for empowerment. But even though Steward (2006) used the keywords in the participative leadership style are participation and empowerment, there was no mutual influence found. However, a main effect of the participative leadership style on change readiness was found. Due to the opportunities and possibilities that are created by this style (Somech, 2005), the change readiness might be effected.
Remarkable in the findings is that, the needs are less related to the change readiness than expected. The leadership styles on the other hand, do show a direct relationship with change readiness. This is consistent with the suggested relation between leadership and change readiness (Caldwell, Chatman, O’Reillly, Ormiston & Lapiz, 2008; Armenakis et al., 1993). It states that the influence of leaders can have a strong effect on the change readiness.
5.2 Limitations and recommendations for further research
This research has several limitations. First of all, employees who have completed the survey are all employed by the same organization. All data were collected from one source. This could have some impact on the results because an organization often has a certain type of employees, that all fit in a particular culture. The external validation is low, therefor it is only possible to draw a conclusion for the concerning business. For further research, it is interesting to involve different types of organizations that work within different industries.
Secondly, the sample size is a restriction. The size of the sample was N = 149. It affects the reliability of the results because of a higher variability. When you have a bigger sample your results will be more reliable and generalizable, because it is a better representation of the reality.
it is interesting to confirm this influence and measure the effect for particular research in the
analyzes.
The fact that there are two variables deleted based on only the Cronbach’s alpha is also a limitation. Normally this is not but because the need for motivating power was not measured by a validated scale this constitutes a weakness. This must be improved in further research. In addition, the item need for motivating power is weak operationalized because this scale is based on a transformational leadership scale. It is a new item and further research in the future is recommended.
Despite the limitations, the results of this study are viable for the company. For further research it would be interesting to carry out more research on the direct impact of the leadership styles. It was found that the three investigated styles of this research directly affect an individual’s change readiness. A more detailed study to this relationship will be valuable. For example, there can be examined which leadership traits have the most effect on change readiness. This will contribute to the development of leadership literature.
Another suggestion is to carry out a similar type of research in various types of industries. It is interesting to look for differences in type of education, level of education and daily work. Finally it would be also interesting to carry out a specific research to the difference between need for motivating power and need for empowerment. These are two important factors for employees that differ but at the same time there can be some overlap. There are also some other needs that may be interesting in change readiness research. For example the need for payoff (McAllaster, 2004) and need for communication (Kotter, 1995).
5.3 Theoretical implications
complemented in this study. Future research concerning both change readiness and employee needs could be based on other combinations of needs and leadership styles or could investigate other expected relationships.
In addition, three leadership styles are included in this study and all three styles have a direct positive influence on employees’ change readiness. Not the fulfillment of the employee needs but rather the leadership style is of great influence. This is an interesting addition to the leadership literature of the three tested styles (Van der Kam et al., 2014; Bass et al., 1996; de Poel et al., 2014).
5.4 Practical implications
Due to the turbulent environment around organizations it is valuable for companies to have some understanding of organizational and human factors that affect the change readiness of employees. If the employees’ needs are well identified, the leader can find out whether this has an effect on change readiness. A better understanding of this might result in a higher success rate of
change projects in the future. Although not all failures are caused by a lack of change readiness or
not fulfilling employee’s needs, the percentage of 70% is disturbing (Cartwright, Schoenberg, 2006).With new insights concerning the relation between employees’ needs and the leadership styles, the change readiness will increase and the failure rate can be reduced (Vakola, 2013). This is partly because new insights will lead to a more effective and efficient approach of change projects.
Because most expected relationships are not significant, it is difficult to provide the practical implications. The chosen needs have no significant influence in this organization. This is valuable information for the change policy in the future. They can focus on the characteristics of leaders who appeal to employees.
5.5 Conclusion
This study was conducted to gain insight in how employee needs influence change readiness. It is also examined whether a specific leadership style can influence this relation. The following research question was formulized in order to obtain those insights: Do specific follower
needs influence the individual readiness for change and is this relationship moderated by
leadership styles?
The hypotheses based on expectations in accordance with academic research, are not supported. Need for motivating power does have an effect on someone's readiness for change, however, a positive relationship is found instead of a negative relationship. Both the expected relationships between change readiness, need for structure and need for empowerment are not shown to be significant. Moreover, there is evidence for a direct relationship between the leadership styles (i.e. transformational, transactional and participative) and change readiness. Although these relationships were not specifically included in our assumptions and expectations, they support current claims in the literature about the positive relationship between leadership styles and change readiness. Lastly it can be concluded that there is little relationship between the selected employee needs and change readiness and also the interaction effect of the specific leadership styles is not shown to be significant.
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