LEADERSHIP STYLES EXPLORED
THEIR RELATION TO THE ORGANIZATIONAL CLIMATE AND EMPLOYEES’ JOB TYPE
Master thesis, MscBA, specialization Human Resource Management University of Groningen, Faculty of Economics and Business
July 14, 2010
GEESJE VAN DEN AKKER Student number: 1752839 Alsemveld 15 7006 TC Doetinchem Tel: +31(0)628407999 e-mail: geesjevdakker@gmail.com Supervisor – university: dr. P.H (Peter) van der Meer
Co-assessor – university: drs. J. (Hans) van Polen
Supervisor – field of study This information is not provided.
TABLE OF CONTENTS ABSTRACT 1. INTRODUCTION………...……… 4 1.1 Leadership………. 4 1.2 Organizational Climate………. 5 1.3 Job Type……… 6 2. THEORETICAL FRAMEWORK………...…………... 7
2.1 Leadership style influencing organizational climate dimensions……….…… 7
2.1.1 Passive/ avoidant leadership style……….……… ……. 8
2.1.2 Transactional leadership style……… 9
2.1.3 Transformational leadership style……….………. 9
2.2 Transactional and Transformational leadership paradigm…………..………. 11
2.3 The Organizational Climate influencing Leadership Styles………. 14
2.3.1 Business Strategy……… 14
2.3.2 Organizational Climate and Leadership.……… 16
2.4 Leadership style influenced by job type………... 17
3. RESEARCH METHODOLOGY………. ………. 18
3.1 Participants……….. 19
3.2 Procedure………. 19
3.3 Measures and data analyses………. 21
4. RESULTS……….. 23
4.1 Description of results… .………...………. 24
4.2 Sub-questions and expectations.………. 26
4.2.1 Leadership style influencing organizational climate dimensions……….. 26
4.2.2 Transactional and Transformational leadership paradigm…………..………... 27
4.2.3 The Organizational Climate influencing Leadership Styles……….. 28
4.2.4 Leadership style influenced by job type……… 28
5. DISCUSSION……… 29 5.1 Summary………. 29 5.2 Theoretical implications…………..……… 30 5.3 Research limitations………..……….. 32 5.4 Conclusion………..………. 33 REFERENCES……….. 34
Appendix A, Climate Survey 2009 ………. 37
Appendix B, The Multifactor Leadership Interview………... 39
LEADERSHIP STYLES EXPLORED
THEIR RELATION TO THE ORGANIZATIONAL CLIMATE AND EMPLOYEES’ JOB TYPE
GEESJE F. VAN DEN AKKER University of Groningen
ABSTRACT
Although academic research has focused on the antecedents of leadership, there is still minor work concerning the existence of the relationship between leadership style and the organizational climate of an organization. This is astounding, given the importance of leadership and a good organizational climate for most modern work organizations. Building on this notion, the present study empirically investigated the link between leadership and organizational climate, and also the effect of the job type on leadership styles of executives is studied. Sub-questions and expectations were developed in order to answer the research questions, and tested with the help of executives and employees of a soft drink organization. Results indicated that the leadership styles of executives did not influence the explored dimensions of the organizational climate in this company. However, the organizational climate seems to affect the leadership styles within the organization. The job type of employees may possibly influence the leadership styles of executives, too. Future research is necessary to demonstrate the relation of leadership to organizational climate and job type in depth.
1. INTRODUCTION
Leadership is one of the most researched areas around the globe and important for the effective functioning of any organization. Leaders influence not only tasks, strategies and organizational goals, but also beliefs, attitudes and behaviour of organizational members (Yukl & Van Fleet, 1998 cited Suar et al., 2006 p. 95). However, times are changing as a consequence of the globalization of the market, and rapidly changing environments confronting organizations today has resulted in calls for more adaptive leadership (Bass et al., 2003). Therefore our knowledge and practice of leadership must adjust to these changes if organizations want to continue playing a role in the market (Sarros & Santora, 2001).
In recent years, topics of leadership and organizational climate have attracted considerable interest from academics and practitioners. Subsequently, the questions arise: what is it that makes these topics interesting? How are the concepts leadership and organizational climate described? And, does it matter whether these concepts are aligned?
Fresh, a soft drinks manufacturer, distributor and sales organization, operates in a fairly competitive environment, with close relationships, participation, and caring for employees. In this organization there is a growing interest in the organizational climate and leadership after results of their Climate Survey in 2007 showed ‘leadership’ as an area of improvement. Therefore, the present study takes a closer look into: the different leadership styles of Fresh’s executives, the relation between the leadership styles of executives and dimensions of the organizational climate, and the influence of employees’ job type on their style of leadership. The research begins with a review of the literature on the concepts of leadership and organizational climate. Furthermore, the influence of the job type of employees on executives’ leadership styles is described. The next section, the ‘theoretical framework’, elaborates further on these concepts, and sub-questions and expectations are developed. This is followed by the methodology adopted for the study and the outcomes of this investigation will be described in the results section. At the end, the discussion section will give a final answer to the research questions. But first, in order to deepen our understanding on the relationship between the concepts leadership, organizational climate and job type, the following subsections explain what is meant by these concepts.
1.1 Leadership
p. 8). In this investigation, three different leadership styles are elaborated: the transformational, transactional and passive/ avoidant leadership style. Initially, Burns (1978) differentiated the two main types of leadership, the transactional and transformational style. According to Burns (1978), the transformational leader motivates its team to be effective and efficient. The leader is adaptive and participative and communication is the key word for goal achievement. These leaders focus on the big picture and are always looking for ideas that move the organization to reach the company’s vision. The leader is highly visible and uses a chain of command to get the job done. On the other hand, Burns (1978) viewed the transactional leader as a leader who initiates contact with subordinates in an effort to exchange something of value, such as rewards for performance, mutual support, or bilateral disclosure. Power is given to the leader to evaluate, correct and train subordinates when productivity is not up to the desired level, however effectiveness is rewarded when an expected outcome is reached. The third leadership style, passive/ avoidant leadership is an avoidance or absence of leadership. The leader who utilizes this style tends to react only after problems have become serious to take corrective action, and often avoids making any decision at all (Judge & Piccolo, 2004). This style is only considered active to the extent that the leader ‘chooses’ to avoid taking action. This component is generally considered the most ineffective form of leadership (Antonakis et al., 2003).
1.2 Organizational Climate
The other concept, organizational climate is often equated to organizational culture. Denison (1996) stated that “the climate and culture literature actually address a common phenomenon: the creation and influence of social contexts in organizations”. However, culture and climate are generally characterized differently but they are also related to each other. Watkin & Hubbard (2003) defined the organizational climate as a measure of employees’ perception of those aspects of their environment that directly impact how well they can do their jobs. It has been conceptualised more extensive as the “relatively enduring quality of the internal environment of an organization that a) is experienced by its members, b) influences their behaviour, and c) can be described in terms of the values of a particular set of characteristics (or attitudes) of the organization” (Tagiuri & Litwin (1986) cited Burton et al. 2004, p. 69). Similarly, Joyce & Slocum (1984) observe that the organizational climate influences the work-related attitudes and behaviours of employees. They argue that it provides a frame of reference through which individuals make sense of organizational life (Ngo et al. 2009).
environments as “being rooted in the organization’s value system, but tends to present these social environments in relatively static terms” (Denison, 1996). Thus, climate often refers to a situation and is linked to thoughts, feelings and behaviours of organizational members. It is temporal, subjective, and depending on the social environment perceived by organizational members. Culture influences the characteristics of the climate by its effect on the actions and through processes of the leader (Denison, 1996). It can be stated that culture has an influence on the organizational climate of the organization.
Unfortunately, only a few studies focus on explaining the role of leadership in managing organizational climate. Most studies describe the role of leadership related to organizational outcomes such as productivity (Ekvall & Ryhammar, 1998), and innovation (Jung et al. 2003). Also the impact of transformational, transactional and passive/avoidant leadership on follower performance, satisfaction, and effectiveness are highlighted (Bass & Avolio, 1993; Howell & Avolio, 1993). Consequently, little research has been devoted to understand the link between leadership style and organizational climate. The relationship between organizational climate and leadership models has been largely neglected and further analysis is necessary to gain remarkable insight in those concepts.
1.3 Job Type
It would be interesting for this study to examine how jobs on different levels of the organizational hierarchy, with different tasks, influence the impact of the transformational, transactional and passive/ avoidant leadership styles. Additionally, the job type, job level and individual accountability of employees may influence the leadership styles of executives. Suar et al. (2006) indicated that important aspects related to styles of leadership are: traits of a leader, attributes of employees and situational factors (e.g. nature of task). In this way, a leader needs to operate in a specific way depending on the maturity of employees and situational factors. There may be presumed that employees lower or higher in the organization are in need of different leadership styles depending on their nature of task and level of maturity (Suar et al., 2006). In a matter of speaking, the nature of task actually decides the achieved level of education needed for an employee to perform well in the job. In this research the nature of task and, the employees’ education level needed to accomplish the job, is called the ‘job type’. Thus, according to the literature of Suar et al. (2006) leadership styles seem dependent on the job type of employees as well. In chapter 2 of this research, the influence of job type on executives’ leadership styles is described more extensively. Considering the research findings in this area, the limited character of these findings suggests a need to investigate the nature of the relationship between leadership style and job type. Hence, the present study will evaluate the role of job type in relation to leadership.
Is there a relationship between leadership styles and the organizational climate? Does the job type of employees influence the leadership styles of executives?
To answer these questions, there are a few other things that need to be taken into consideration:
- Do executives of Fresh make use of different leadership styles or a combination of styles? Or does one specific leadership style dominate?
- Is there a relationship between leadership styles and the organizational climate of Fresh?
- If executives of Fresh display different styles of leadership, is this caused by differences in job type between employees?
2. THEORETICAL FRAMEWORK
This section will give an extended description of the different concepts of this research. After each description sub-questions and expectations are developed in order to answer the research questions. In the first part, the effect of leadership styles on dimensions of the organizational climate is outlined (2.1), and the passive/ avoidant, transactional and transformational leadership styles are further elaborated (2.1.1, 2.1.2 & 2.1.3). Next, the augmentation model of both leadership styles is evaluated combined with the leadership strategy of Fresh (2.2). Subsequently, the importance of the organizational climate is stressed and how this influences leadership, then the leadership strategy of Fresh is analysed (2.3, 2.3.1 & 2.3.2). Finally, the relationship between the different leadership styles and the role of job type is explored (2.4).
2.1 Leadership Style influencing Organizational Climate Dimensions
subordinates (Ngo et al., 2009). An example of dimensions of the organizational climate are perceptions of employees about the: direction, goals and objectives of an organization, the management team, their leader, their job, cooperation and teamwork with other departments and within their own team, external focus, innovation, rewards and recognition, personal development, and their overall attitude about the organization. In Fresh, all the perceptions of employees about these dimensions of the organizational climate are measured by making use of a Climate Survey customized for the organization. But, are these organizational climate dimensions affected by the use of different leadership styles? In this research, the organizational climate dimensions Innovation, Rewards & Recognition and My Manager are used to investigate this possible relationship. Appendix A presents a part of the Climate Survey in 2009, there will be elaborated on this survey in the methodology section of this study.
As mentioned in the introduction, three different leadership styles are investigated at Fresh: the transactional, transformational and passive/avoidant leadership style. Below, the transactional and transformational leadership styles are further described. First, a short explanation is given about the passive/ avoidant style.
2.1.1 Passive/ avoidant Leadership Style
2.1.2 Transactional Leadership Style
Transactional leadership, also called the telling style, has dominated leadership research since World War ІІ. Exhibiting transactional leadership meant that followers agreed with, accepted, or complied with the leader in exchange for praise, rewards, and resources or the avoidance of disciplinary action. Rewards and recognition were provided on followers successfully carrying out their roles and assignments (Podsakoff, Todor & Skov, 1982 cited Bass et al. 2003 p. 208). According to Bass (1985), transactional leadership clarifies expectations and offers recognition when goals are achieved. Bass (1985) differentiated two types of transactional leadership according to the leader’s level of engagement with followers and activity level. In the first type, the contingent reward leadership, the leader and follower negotiate an agreement regarding what rewards or recognition the follower will receive for a specific level of performance. Rewards, recognition, or both are provided when the follower attains the contracted level of performance. Furthermore, the leader discusses in specific terms who is responsible for achieving performance targets. The majority of research findings suggest that contingent reward leadership has a positive effect on individual follower performance (Howell & Hall-Merenda, 1999). The second type, management-by-exception (active), contains a leader who avoids giving directions if the old ways are working and allows followers to continue doing their jobs as always if performance goals are met. This leadership style implies closely monitoring for deviances, mistakes and errors and then taking corrective action as quickly as possible when they occur. Empirical examination of the impact of management-by-exception (active) leadership on followers’ performance has obtained mixed results (Howell & Hall-Merenda, 1999).
2.1.3 Transformational Leadership Style
followers’ needs on Maslow’s hierarchy of needs (Hater & Bass, 1988). Howell & Hall-Merenda (1999), observe that transformational leaders who encourage followers to question assumptions and generate new ideas, develop their capabilities, and aspire to accomplish challenging future goals are expected to enhance followers’ performance on the job. Also, results of Politis (2001) indicate that the leadership styles that are characterized by participative behaviour, mutual trust and respect for subordinates’ ideas and feelings are correlated stronger. Shamir, House and Arthur (1993) suggested that transformational leaders transform the self-concepts of their followers. They build personal and social identification among followers with the mission and goals of the leader and organization. The followers’ feelings of involvement, cohesiveness, commitment, potency, and performance are because of that enhanced. Transformational leadership develops followers to believe in themselves and their mission (Bass et al. 2003). In sum, Bass & Avolio (2003) categorized the features of transformational leadership in the following factors. At first: Idealized influence (attributes and behaviour), the leader instills pride, faith, respect and displays a sense of power and confidence. The leader has a gift for seeing what is really important, and transmits a sense of mission. Secondly: Inspirational motivation, these leaders behave in ways that motivate those around them by providing meaning and challenge to their followers’ work. They are enthusiastic and optimism is displayed. Furthermore, these leaders articulate a compelling vision of the future. The third factor is: Intellectual stimulation, these leaders stimulate their subordinates to be innovative and creative by questioning assumptions and approaching old situations in new ways. There is no ridicule or public criticism of individual members’ mistakes. At last, the factor: Individual consideration plays a role in transformational leadership. Attention is paid by the leader to the individual’s need for achievement and growth by acting as a coach. New learning opportunities are created along with a supportive climate in which to grow and individual differences in terms of needs and desires are recognized.
Sub-question 1) Do executives of Fresh make use of different leadership styles? And if so, which leadership styles do they generally apply?
Expectation 1a) Based on the literature, I expect that executives who make use of the transactional leadership style will have a more positive influence on the perceptions of employees concerning the rewards and recognition dimension of the organizational climate compared to executives who display the transformational leadership style.
Expectation 1b) Based on the literature, I expect that executives who make use of the transformational leadership style will have a more positive influence on the perceptions of employees concerning the innovation dimension of the organizational climate compared to executives who display the transactional leadership style.
2.2 Transactional and Transformational Leadership Paradigm
Burns (1978) first introduced the concepts of transformational and transactional leadership in his treatment of political leadership. Burns considered the transformational leader to be distinct from the transactional leader, where the latter is viewed as a leader who initiates contact with subordinates in an effort to exchange something of value, such as rewards for performance, mutual support, or bilateral disclosure. At the other pole of the leadership style dimension, Burns viewed the transformational leader as one who engages with others in such a way that the leader and the follower raise one another to a higher level of motivation and morality (Lowe, et al. 1996).
transactional to a mix of both transformational and transactional leadership styles. Thus, the full range of potential is achieved through both, not either one versus the other leadership style (Bass & Avolio, 2004). Also Howell & Avolio (1993) and Judge & Piccolo (2004) pointed out that transformational leadership does not replace transactional leadership, but augments transactional leadership in achieving the goals of the leader, associate, group, and organization.
In figure 1, the newer paradigm, transformational leadership is added to previous transactional leadership models.
FIGURE 1
The Augmentation model of Transactional and Transformational Leadership
Source: Bass & Avolio (2004)
for an organizational mission, which serves as a motivator itself (cited Hater & Bass, 1988 p. 695). More than three decades of research in performance-oriented and maintenance-oriented behaviour by leaders has provided consistent evidence that both types of behaviour, thus combined leadership styles, lead to success within the team (Hater & Bass, 1988).
Also Bass & Avolio (2003) state that the best leaders use a full range of transformational and transactional leadership styles, both styles are related to the success of the department. They assume that the success of departments is measured by the level of extra effort accomplished by executives, their effectiveness, and the satisfaction of the executives about their own leadership style. In this way, executives try to increase the willingness of employees to work effectively and to achieve successful team performances. Besides, an executive satisfied about his/her leadership style may positively affect the success of the department (Bass & Avolio, 2003). In addition, Bass & Avolio (2003) state that transformational and transactional leadership are both related to the satisfaction of the employees about their leader. They suppose that employees are more satisfied when executives make use of both leadership styles. Based on the literature of Hater & Bass (1988) and Bass & Avolio (2003, 2004), I expect positive results concerning the success of the departments, when executives use a combination of both transformational and transactional leadership styles. I expect that the extra effort of the executive, his or her effectiveness and satisfaction about leadership may influence this success. Therefore, another question is added below the research questions:
“Does a mix of both transactional and transformational leadership behaviours positively influence the perceived success of executives in the department and employees’ satisfaction about their leader?”
However, before this additional question can be answered it would be wise to know more about the leadership strategy of Fresh. What kind of leadership strategy does Fresh prescribe, and does this organization stimulate the use of both transformational and transactional leadership styles?
Sub-question 2) Do executives of Fresh make use of a combination of both the transformational and transactional leadership styles, or do they principally apply one specific leadership style?
Expectation 2a) Based on the literature, I expect that executives who display both the transformational and transactional leadership style perceive more success within their department than executives who display either the transformational or transactional leadership style.
Expectation 2b) Based on the literature, I expect that executives who display both the transformational and transactional leadership style have more employees that are satisfied about their leadership style than executives who display either the transformational or transactional leadership style.
2.3 The Organizational Climate influencing Leadership Styles 2.3.1 Business Strategy
Burns & Stalker (1961) introduced the mechanistic and organic regimes. In the mechanical regime the task (or department) that the employee is responsible for is not brought into relation with the organization’s overall production process. The coordination of independent tasks takes place at a higher level of the hierarchy (cited Bax, 2003 p. 66). Fresh can be characterized as an organization with an organic regime. Here it is all about the communal achievement of the goals. The process of dividing labour within the organization ensures a mutual dependency that creates bonds and cohesion. As also confirmed by Bax (2003), a dynamic, complex environment with a normal level of competition requires an organic regime because of its flexibility and quick adjustments.
Furthermore, Bax (2003) describes the relationship between characteristics of the production technology, the environment, the culture and structure of an organization. He developed the TECS (technology, environment, culture and structure) model, an analytical instrument with which you can systematically put the organization into perspective from the demand side of the labour allocation process. This model shows whether or not the demand side of the labour allocation process is internally consistent and if it is in alignment with environmental requirements. Applying this model, Fresh must pay attention to ensure that each of their choices remain consistent with other elements of their business policy. Figure 2 shows an example of the TECS model in balance applied to Fresh.
FIGURE 2
An example of the TECS model in balance applied to Fresh
Mechanical Organic
T
■
E
■
C
■
S
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hard contracting people have jobs rather than careers (Bax, 2003). In sum, Fresh can be characterized as an organic organization with soft contracts. Based on the strategy of Fresh, Miles and Snow (1987) would classify Fresh principally as a prospector. These organizations follow a strategy of innovation and try to bring new products and services to the market (Bax, 2003). The prospector tries to create a distinctive product. This fits to the business strategy of Fresh. In figure 3 an overall picture of Fresh’s strategy and traits is outlined. In addition the theory of Bax (2003) is added to the figure.
FIGURE 3
A summary of Fresh’s Strategic Orientation Category (Miles & Snow, 1987) and the Classification Scheme (Bax, 2003)
Strategic Orientation
Main focus Traits Classification
scheme
Contract type Prospector Entrepreneurial,
innovative and new opportunity orientated
External orientation, environment scanning,
maximizing new opportunities. Innovative to meet marked needs. Flexibility and freedom from constraining company rules and regulations. Welcomes changes and sees the
environment as 'uncertain'
Organic Soft
2.3.2 Organizational Climate and Leadership
expected in an organic environment as Fresh. However, the leadership strategy of Fresh strives for a combination of both transformational and transactional leadership. The results of this research show if executives are following the leadership style prescribed by Fresh or whether they are following a transformational leadership style which fits the organic character of the organization.
Overall, the literature on culture and leadership clearly indicates that organizational culture and leadership are linked. Schein (1992) suggests that the relationship between culture and leadership represents an ongoing interplay in which the leader shapes the culture and in turn is shaped by the resulting culture (cited Ogbonna et al., 2000 p. 770). Similarly, Brown (1992) observes that good leaders need to develop the skills that enable them to alter aspects of their culture in order to improve their organizational performance (cited, Ogbonna et al., 2000 p. 770). Thus, as far as leadership is concerned, leadership not only affects the organizational culture, but is also affected by culture itself (Mamatoglu, 2008). Because organizational climate is part of the organizational culture I expect the same relationship between climate and leadership. The following sub-question and expectation are developed:
Sub-question 3) Does the organizational climate affect the leadership styles of executives?
Expectation 3a) Based on the organic character of Fresh, I expect that executives generally display the transformational leadership style .
2.4 Leadership Style influenced by Job Type
increases the organizational performance and satisfaction of the subordinates in higher levels of the organization (Suar et al., 2006). Applying this literature to the organization Fresh, the nature of the job and education level of the employee may also affect the leadership style of executives. Although, the leadership style is expected to be mainly transformational, it may occur that executives who manage lower levels of the organization apply a more transactional leadership style based on the degree of maturity of the employees. For instance, employees with a lower level of education in the production area of Fresh, who accomplish simple tasks, may not understand, accept or are just not interested in the organization’s normative structure and vision of the organization. In this case a transactional, telling leadership style could work best for the team. Therefore it is expected that the concepts leadership and job type are linked (Suar et al., 2006). As mentioned before, the job type is described as the nature of task in combination with the educational level of the employee. For this research employees with a lower level of education are certified at a Secondary Vocational Education level (MBO), and employees with a higher level of education are at least certified at a Higher Vocational Education level (HBO).
I suppose that the job type of employees has an influence on the leadership styles of executives, too. According to this expectation the following sub-question and expectations are proposed:
Sub-question 4) Do executives of Fresh display different leadership styles depending on the job type of employees?
Expectation 4a) Based on the literature, I expect that executives display relatively more transactional leadership styles in departments where employees work who are certified at a lower level of education and accomplish simple tasks.
Expectation 4b) Based on the literature, I expect that executives display relatively more transformational leadership styles in departments where employees work who are certified at a higher level of education and accomplish more complex tasks.
3. RESEARCH METHODOLOGY
3.1 Participants
Data for the present study were gathered from 21 executives in the upper level of the organization in order to explore their leadership styles and perceived success within the department. These data were acquired from executives of the main departments of Fresh, which are the Food, Marketing, Out of Home & Export, Supply Chain, Security and the Human Resources department. Most executives participating in this research were male (95%) and the age of the executives ranged from 32 to 56 years. The educational level of executives ranged from Higher Vocational Education to University level. Employees participated in this study too, in order to examine their perceptions about dimensions of the organizational climate of Fresh. Concerning the employees, mainly males participated in this research (84%). The age of the employees ranged from 23 to 63 years. The employees were educated from Secondary Vocational Education level to University level. The teams of the departments involved were ranging in size from 5 to 20 members. The participants seem to be representative because all prominent leaders participated in this study and only departments of at least 6 employees were used for a comparison between leadership styles and organizational climate dimensions.
3.2 Procedure
Interviews. Interviews were developed by translating the Multifactor Leadership Questionnaire
Climate Survey. Employees’ answers on statements of the Climate Survey were used to analyse
the sub-questions and expectations in which the climate dimensions Innovation, Rewards & Recognition and My Manager were involved. In appendix A, these climate dimensions are presented, as they are part of the Climate Survey. The data with answers of all participating employees in the Climate Survey were gathered in an Excel file from the Organizational Climate department. In order to acquire reliable results, departments with at least 6 employees completed the survey and a reliability analysis was made for the Innovation, Rewards & Recognition and My Manager dimensions to measure the internal consistency between the statements belonging to each climate dimension. Therefore, the Climate Survey output was converted from Excel to the SPSS program so that the Cronbach’s Alpha for each climate dimension could be analysed. Unfortunately, it was not possible to use SPSS for the comparison between the organizational climate dimensions and the different leadership styles. This was due to the fact that the acquired Climate Survey answers of employees were recorded in the Excel file according to the five main departments of Fresh in its entirety. For instance, one of the main departments ‘Out of Home’ exists of 5 executives who were interviewed. All answers of the Climate Survey concerning the employees working in the Out of Home department were recorded together, hence it was not possible to filter these answers separately according to the different executives of the department. Therefore, the online ‘Climate Survey Tool’ was utilized in this research to see the results of employees concerning their favourableness about the climate dimensions Innovation, Rewards & Recognition, and My Manager for each department. From 2 out of 21 departments it was not possible to analyse the answers of employees considering all climate dimensions. The first department consisted mainly of temporary workers and for this reason their answers were not taken into account. For the other department, I was not able to obtain reliable results because of a low response rate. In another department the executive started working at Fresh after the implementation of the Climate Survey in 2009, therefore it was not possible to compare the results of this department, concerning the climate dimension My Manager, to the leadership style of the executive.
Job descriptions. The information about the job type of employees was gathered by making use
of job descriptions of all jobs within Fresh. With the help of these job descriptions it was possible to differentiate jobs with employees certified at a lower level of education who are accomplishing simple tasks and jobs with higher educated employees who are accomplishing more complex tasks.
3.3 Measures and Data Analysis
Leadership styles of executives
purposes. Thirty-two descriptive statements are mentioned during this interview, each of them is related to the transformational, transactional or passive/avoidant leadership style. Appendix C demonstrates the statements that belong to each leadership style. In this self rating, leaders evaluate how frequently, or to what degree, they believe they engage in a certain leadership behaviour toward their associates. However, a combined style of the two leadership styles, transformational and transactional leadership, is also a possibility. For rating the frequency of leadership behaviours a five point scale is used, according to a tested list of anchors provided by Bass, Cascio, and O’Connor (1974). The anchors used to evaluate the MLQ factors are presented as follows:
Rating Scale for Leadership Items 0 = Not at all
1 = Once in a while 2 = Sometimes 3 = Fairly often
4 = Frequently, if not always
All 21 most prominent executives were invited for this investigation and 21 interviews were accomplished, giving a participation rate of 100%. In view of the high participation rate and the willingness of executives to react to the statements during the interview, the interview seems representative enough to use as a source for the evaluation of the sub-questions and expectations.
Success factors
Furthermore, at the end of the interview, statements about the level of extra effort accomplished by executives, their effectiveness, and the satisfaction about their own leadership behaviour are used in this interview to measure the perceived success of executives in their department. At the bottom of appendix C the statements related to success are described. In this study, the Multifactor Leadership Interview was only useful to measure the perceptions of executives about the statements related to success. In order to measure the satisfaction of employees about the leadership style of their executives, answers of the climate survey were used concerning the organizational climate dimension ‘My Manager’.
Leadership styles and organizational climate dimensions
of employees on the climate dimensions of the Climate Survey, a six point scale is used. The anchors used to evaluate the Climate Survey are presented as follows:
Rating Scales for Climate Survey
1= Strongly Agree 1= Very Good
2= Agree 2= Good
3= Neither Agree Nor Disagree 3= Average
4 =Disagree 4= Poor
5= Strongly Disagree 5= Very Poor 6= Not Applicable 6= Not Applicable
In total, 357 Climate Surveys were distributed and 307 surveys completed giving a response rate of 86%. Thus, 307 employees of Fresh were involved in this investigation. With the help of the online ‘Climate Survey Tool’, the results of employees concerning their favourableness about the climate dimensions Innovation, Rewards & Recognition, and My Manager were presented in percentages. The expected relationship between leadership styles and organizational climate dimensions was investigated by making use of these outcomes in percentages. The percentages of all departments, with executives who display a common leadership style, were added up and a mean was calculated for each leadership style. The mean of these percentages was utilized to calculate the number of employees who were favourable about a certain climate dimension and in command of the same leadership style. This information clarified whether differences in the leadership styles of executives affect the organizational climate dimensions.
As mentioned in the procedure (3.2), the reliability analysis evaluated the internal consistency between the statements belonging to Innovation, Rewards & Recognition and My Manager, in order to make a reliable conclusion about leadership styles affecting these climate dimensions. The reliability statistics presented the following outcomes:
- Innovation was measured by 3 items. The response rate for the dimension innovation was 99.4%. The Cronbach’s Alpha for these questions was .69.
- Rewards & Recognition was measured by 3 items. The response rate for this dimension was 99.0%. The Cronbach’s Alpha for these questions was .62.
- My Manager was measured by 8 items. The response rate for this dimension was 99.4%. The Cronbach’s Alpha was .93.
climate of Fresh on the different leadership styles of executives was also taken into consideration. These outcomes were gathered by making use of the Multifactor Leadership Interview to see whether the transformational leadership style was generally displayed, as expected, within the organic organization Fresh.
Leadership styles influenced by job type
Job type was measured by making use of the company documentation of Fresh. The job descriptions for each department indicated the job type of employees. This information supplies an overview of the departments with employees educated below the Higher Vocational Education level who are accomplishing simple tasks. It was expected that the job type of employees would influence the leadership style of executives. The interview results, with information about the different leadership styles of executives, were compared to the job types in Fresh to see whether a relatively more transactional leadership style is displayed in departments where lower level educated employees accomplish simple tasks. Whereas, a relatively more transformational leadership style is applied in departments where employees certified at a higher level of education accomplish more complex tasks.
4. RESULTS
4.1 Description of Results
The results of the interviews conducted explain to what degree executives believe they engage in a certain leadership behaviour toward their associates. In view of table 1, most executives of Fresh generally display a more transformational leadership style. Secondly, the combined style of both transformational and transactional leadership is applied. None of the executives make use of the transactional or passive/ avoidant leadership style.
TABLE 1
Interview Results of Leadership Styles related to the norm Leadership Styles of
Executives
Number of Executives Mean Score on Leadership Style Transformational 13 3,4 Transformational & Transactional 7 3,4 Transactional 0 0,0 Passive/ Avoidant 0 0,0 Below Norm 1 2,1 Total Executives 21 Note: Norm ≥ 3.0
TABLE 2
Interview results concerning perceived success of Executives Leadership Styles of
Executives
Number of Executives Mean Score on Success Perceived Success in % Transformational 13 3,2 80% Transformational & Transactional 7 3,5 88% Transactional 0 0,0 0% Passive/ Avoidant 0 0,0 0% Below Norm 1 2,6 0% Total Executives 21 Note: Norm ≥ 3.0
The answers of employees according to the dimensions of Climate Survey were analysed in order to make a comparison between the different leadership styles of executives and the organizational climate dimensions Innovation, Rewards & Recognition and My Manager. Table 3 indicates that employees led by a combined style of both transformational and transactional leadership are most favourable about all climate dimensions compared to executives who utilize only the transformational leadership style. However, there is only a small difference in percentage between the outcomes of employees arranged according to the transformational or the combined leadership style.
TABLE 3
Employees’ Climate Survey Scores on the Climate Dimensions Leadership Styles of Executives Total Employ. Employees favourable about IV = in % Employees favourable about RR = in % Employees favourable about MM = in % Transformational 129 80 62% 71 55% 92 71% Transformational & Transactional 178 121 68% 105 59% 137 77% Transactional 0 0 0% 0 0% 0 0% Passive/ Avoidant 0 0 0% 0 0% 0 0% Total Employees 307
Finally, job descriptions of every department in Fresh were analysed. They indicate the difference in job type between employees. The results concerning leadership styles and job type are shown in table 4. It shows that transformational leadership styles are principally displayed for higher educated employees who accomplish relatively more complex tasks. At the same time, executives leading employees in the production sector of Fresh, who are lower educated and accomplish simple tasks, make more use of both transformational and transactional leadership.
TABLE 4
Leadership styles and job type Leadership Styles of
Executives
Executives leading Higher Educated employees
(complex tasks)
Executives leading Lower Educated employees (simple tasks) Transformational 11 1 Transformational & Transactional 6 2 Transactional 0 0 Passive/ Avoidant 0 0 Below Norm 1 0 Total Executives 18 3 Note: Norm ≥ 3.0
4.2 Sub-questions and Expectations
4.2.1 Leadership style influencing organizational climate dimensions
perceive their style as generally transactional. Moreover, 59% of the employees, managed by executives with a mix of both leadership styles, are favourable about rewards and recognition within the organization. At the same time, also 55% of the employees, led by executives with only a transformational leadership style, are favourable about rewards & recognition. This indicates a small difference in percentages between the outcomes of the employees arranged according to the transformational and combined style of both transformational and transactional leadership. Therefore no clear relationship is noticeable between the different leadership styles and the Rewards & Recognition dimension.
Expectation 1b predicted that executives who make use of the transformational leadership style will have a more positive influence on the perceptions of employees concerning the Innovation dimension of the organizational climate compared to executives who display the transactional leadership style. Actually, table 3 demonstrated that 62% of the employees, who are managed by a transformational leadership style, are positive about innovation. However, employees with a manager who uses a combination of both transformational and transactional leadership are even more favourable about the innovation in the organization (68%). For expectation 1b also counts that no relationship is noticeable between the leadership styles and the Innovation dimension.
4.2.2 Transactional and transformational leadership paradigm
According to the second sub-question it can be stated that besides executives who display either a transformational or transactional leadership style, there are also executives who use both leadership styles. As mentioned before, 7 executives of Fresh use a combination of both transformational and transactional leadership. Using this information it was possible to answer the expectations. The first expectation (2a) predicted that executives who display both leadership styles perceive more success within their department than executives who display only a transformational or transactional leadership style. Table 2 indicated that executives who apply a mix of both transformational and transactional leadership experienced on average more success in their team (88%) compared to executives who made use of only a transformational style of leadership (80%). Anyhow, both leadership styles show a high percentage of perceived success. This argues that 20 of the 21 executives are satisfied about the factors that lead to success in their team.
is visible between the leadership styles in relation to the ‘satisfaction about the leader’ and, on average, most employees are satisfied about their leader.
However, while studying the results of the Climate Survey it is notable that employees working in the production sector of Fresh are less satisfied about their leader. On average, only 53% of the employees working in the production sector are satisfied about their leader. This is noteworthy because the transformational or mixed leadership style is used by all executives of Fresh while a transactional leadership style may work best for the production departments where lower level educated employees are accomplishing simple tasks.
4.2.3 The organizational climate influencing leadership styles
It was expected, that the organizational climate affected the leadership styles of executives. As described in the section ‘business strategy’ (2.3.1), the organizational character of Fresh is considered as organic. Table 1 and 2 indicated that approximately two-thirds of all executives are displaying the transformational leadership style, that fits the organic character of Fresh. But, also one-third of the executives make use of a combination of both transformational and transactional leadership behaviour. It can be stated that the leadership styles within Fresh are generally based on the organizational climate of the organization.
4.2.4 Leadership style influenced by job type
5. DISCUSSION
5.1 Summary
The goal of the present study was to investigate a possible relationship between leadership styles and the organizational climate. Furthermore, the impact of the job type of employees was examined in relation to leadership. Other questions that needed to be considered were:
- Do executives make use of different leadership styles or a combination of styles? Or does one specific leadership style dominate?
- Is there a relationship between leadership styles and the organizational climate of Fresh?
- If executives of Fresh display different styles of leadership, is this caused by differences in job type between employees?
- Does a mix of both transactional and transformational leadership behaviours positively influence the perceived success of executives in the department and employees’ satisfaction about their leader?
5.2 Theoretical Implications
In the present study the results display that executives of Fresh principally make use of the transformational leadership style. Secondly, the combination style of both transformational and transactional leadership is used. The other leadership styles, transactional or passive/ avoidant, are not applied by any executive. The results in this study are consistent with the findings of Bass (1985) and Lowe et al. (1996), who demonstrated that transformational leadership is more likely to emerge in organizations with less constrictive, organic environments. Thus, in Fresh the leadership style dominates that fits the organic regime, namely the transformational leadership style. The adoption of a combination of both transformational and transactional leadership by executives is not surprising, either. Based on the leadership strategy of Fresh, both transformational and transactional aspects are described (Van den Brink & Van der Veer, 2008). The use of both leadership styles could be explained by the prescribed leadership style of Fresh in which the use of transactional leadership is partly stimulated by the organization. Therefore, the prescribed leadership style of the organization exemplifies that one-third of the executives makes use of both leadership styles.
leadership styles. Unfortunately, here, too, counts that no comparison could be made with executives using the transactional leadership style. In general, employees are more positive about innovation than about rewards & recognition within the organization. This emphasizes the common use of transformational leadership behaviour.
Yet, the organizational climate may possibly affect the leadership styles within the organization. It is not by chance, that most executives make use of a transformational leadership style that fits the organizational culture and climate. Even in departments with employees certified at a lower level of education who accomplish simple tasks, the transformational style or combined style is used. This indicates that the organizational culture of Fresh, that influences the climate, determines the leadership styles within the organization. This is in line with the literature of Ogbonna et al. (2000) and Mamatoglu (2008). They stated that as far as leadership is concerned, leadership not only affects the organizational culture, but is also affected by the culture itself.
Furthermore, the results display that executives who applied the combined style of both transactional and transformational leadership behaviours experienced on average more success in their team compared to executives who made use of only the transformational style of leadership. Broadly speaking, the results indicate that executives are on average very satisfied concerning the success within their team, if a combination of transformational and transactional leadership is used. This is in line with the literature of Bass & Avolio (2004) and Suar et al. (2006) who disseminate that both leadership styles are necessary for leadership effectiveness, satisfaction with the leadership and extra effort (performance beyond expectations). However, executives with only a transformational style of leadership perceive a high level of success in their team, too. Therefore, it cannot be concluded that executives who display both leadership styles are more satisfied than transformational leaders, concerning the success of the group. Just as no comparison could be made with executives using the transactional or passive/avoidant leadership style. The same conclusion counts for the outcomes based on the ‘satisfaction about the leader’ measured with the organizational climate dimension My manager. Executives who display both leadership styles have on average very positive results concerning the satisfaction of employees about their leadership. This is in line with the literature of Bass & Avolio (2003) who stated that employees are more satisfied when executives make use of both leadership styles. But the results showed a high percentage of satisfied employees about transformational leaders, too. Nevertheless, in both cases the scores about ‘perceived success’ and ‘my manager’ are slightly higher when leaders make use of both leadership styles compared to transformational leaders. However, irrespective of the leadership style of their executives, most employees are satisfied about their leader. Only employees working in the production sector of Fresh are on average less satisfied about their leader.
job type of employees may possibly influence the leadership styles of executives. It can be stated that transformational leadership styles are generally used for departments with higher educated employees who accomplish relatively more complex tasks. Although, the combined style is applied more often by executives who lead lower educated employees who perform simple tasks. This outcome was partly expected according to the theory of Suar et al. (2006). They stated that the preferred leadership style for less mature subordinates with simple tasks is a transactional leadership style. The results showed that in Fresh the transactional leadership style is also displayed relatively more often in departments with lower level educated employees who accomplish simple tasks, even though this transactional style is combined with transformational leadership. This result can be explained by the fact that employees educated at a lower level are in need of a more transactional leadership style. These employees would like to be directed by their leader. In this case, the transactional leadership style works best for the team, although the transformational leadership style is applied in other departments where employees educated at a higher level are in need of a more transformational leadership style.
5.3 Research Limitations
Some limitations should be considered carefully when interpreting the findings. First it is important to make notice of the executives who were part of the research sample. Like mentioned in the methods section, executives used the Self Rating Leader Form of the Multifactor Leadership Questionnaire, where supervisors rate themselves as leaders. For this investigation only the perceptions of executives themselves are used to describe their leadership style. However, since leadership is in the ‘eye of the beholder’, why are data only collected from the ‘self beholder’? Unfortunately, interviewing 357 employees was no option, and it was not authorized to accomplish leadership surveys for employees. Nonetheless, the Self Rating Form for executives was experienced as representative because of the high response rate on my invitation email and 100% participation rate. All executives were willing and enthusiastic to take part in my research. For further research, involving the Rater Form of the Multifactor Leadership Questionnaire gives an even stronger establishment for the research findings. This rater form is used by employees to describe the leadership style of their executive as they perceive it.
Secondly, as explained in the procedure (3.2) of this research, for 2 out of 21 executives it was not possible to make a comparison between their leadership styles and the organizational climate dimensions. For another department, it was not possible to compare the results concerning the climate dimension My Manager to the leadership style of the executive.
low. Taking this into consideration, a measurement error may have attenuated the results concerning the relationship between Rewards & Recognition and leadership styles.
In the fourth place, it was not possible to compare the results between the organizational climate dimensions and the different leadership styles with the use of the SPSS program. Fortunately, the ‘Climate Survey Tool’ could be applied in order to make this comparison.
Finally, it was unfortunate that no comparisons could be made between executives displaying either a transformational or transactional leadership style. None of the executives made use of a solitary transactional leadership style while this was expected for the research.
5.4 Conclusion
Broadly speaking, the results show that about two-thirds of Fresh’s executives generally make use of the transformational leadership style. Also one-third of the executives displays a mix of both transformational and transactional leadership behaviour. In this study, the leadership styles do not affect the explored dimensions of the organizational climate. However, the outcomes explain that the organizational climate may possibly influence the leadership styles within the organization. The results indicate as well, that differences in job type between employees may possibly affect the leadership styles of executives. Evidence, that the combined leadership style more positively influences the perceived success of executives about their team and the satisfaction of employees about their leader compared to executives displaying the transformational leadership style, is too small to demonstrate a relationship.
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Appendix A
Climate Survey 2009
C My Manager
10 How would you rate your direct manager on: Dealing fairly with everyone, playing no favourites
Very
Good Good Average Poor Very Poor
Not applicable 11 How would you rate your direct manager on: Being
accessible/ available when you need him or her
Very
Good Good Average Poor Very Poor
Not applicable 12 I have trust and confidence in my direct manager Strongly Agree Agree
Neither Agree Nor
Disagree
Disagree Disagree Strongly applicable Not 13 Day-to-day decisions and actions of my direct manager are consistent with his/her words Strongly Agree Agree
Neither Agree Nor
Disagree
Disagree Disagree Strongly applicable Not 14 My direct manager stimulates me to improve my performance Strongly Agree Agree
Neither Agree Nor
Disagree
Disagree Disagree Strongly applicable Not 15 My direct manager provides clear and regular
feedback on my performance Strongly Agree Agree Neither Agree Nor Disagree Disagree Strongly Disagree Not applicable 16 My direct manager keeps me informed about
important company developments
Strongly Agree Agree Neither Agree Nor Disagree Disagree Strongly Disagree Not applicable 17 I can freely express my views without fear Strongly
Agree Agree Neither Agree Nor Disagree Disagree Strongly Disagree Not applicable F Innovation
32 I am encouraged to be innovative in my job (i.e., to come up with new or better ways of doing things)
33 Employees are encouraged to take reasonable risks (e.g., try new ideas, new ways of doing things)
Strongly Agree Agree Neither Agree Nor Disagree Disagree Strongly Disagree Not applicable 34 I often waste a significant amount of time and effort because of unnecessary procedures Strongly Agree Agree
Neither Agree Nor
Disagree
Disagree Disagree Strongly applicable Not
H Rewards and Recognition 38 I believe I am paid fairly for the work I do Strongly Agree Agree
Neither Agree Nor
Disagree
Disagree Disagree Strongly applicable Not 39 The better my performance, the better my pay will be Strongly
Agree Agree Neither Agree Nor Disagree Disagree Strongly Disagree Not applicable 40 I receive recognition when I do a good job Strongly
Appendix B
Multifactor Leadership
Interview
Leadership styles of Executives
MULTIFACTOR LEADERSHIP INTERVIEW
This interview is to describe your leadership style as you perceive it. If an item is irrelevant, or you are unsure or do not know the answer, the item is left blank. Thirty-two descriptive statements are mentioned during this interview. Judge how frequently each statement fits you.
The following rating scale is used:
Not at all 0 Once in a while 1 Sometimes 2 Fairly often 3
Frequently, if not always 4
