TRANSACTIONAL LEADERSHIP AND EMPLOYEE COMMITMENT

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The most valuable and indispensable resource that any organization needs in order to be effective and efficient is human resource. Givens (2008) has argued that well-qualified and capable personnel are important in context of achieving goals and objectives of an organization. The success of an organization depends on the hard working, loyal and involved managers and employees. Leadership is a bond which makes people to work together. Organizations at present are more concerned about understanding, development and improvement of their leadership. Transformational leadership is a modern approach towards leadership. Thamrin (2012) has defined transformational leadership as what leaders’ do in order to transforms the values, needs, aspirations, followers’ priorities and also motivates their followers to exceed expectations.

Transformational leadership theory has captured the interest of many researchers in  the  field  of organizational leadership over the past three decades. Burns developed this theory (1978) and later Bass (1978,1985). The major premise of the transformational leadership theory is the leader’s ability to   motivate the follower  to   accomplish  more  than   what   the   follower  planned  to   accomplish  (Metwally, 2014). Transformational leadership has four components: idealized influence, inspirational motivation, intellectual stimulation,  and  individualized  consideration  (Thamrin, (2012).  Transformational  leaders  inspire followers to accomplish more by concentrating on the follower’s values and helping the follower align these values with the values of the organization. Furthermore, Burns identified transformational leadership as a relationship in which the leader and the follower motivated each other to higher levels which resulted in value system congruence between the leader and the follower (Metwally, 2014).

Transformational leadership has been associated with the personal outcomes, (Arnold K, Barling J, Kelloway K., 2000) of the follower as well as organizational outcomes. Research has shown that transformational leadership impacts follower  satisfaction  (Metwally, 2014)  and  commitment  to   the   organization  (Givens 2008).  Research  has  also   shown  that transformational leadership impacts employee commitment to organizational change and organizational conditions (Arnold K, Barling J, Kelloway K., 2000). Due to its impact on personal and organizational outcomes, transformational leadership is needed in all organizations (Givens 2008).

Leadership is associated with organizational and employee performance, (Thamrin 2012). Leadership plays an important role in determining employees’ commitment. Researchers have found that employees who are pleased with their supervisors/leaders and feel that they are being treated with respect and are valued by their management feel more attachment with their organizations ( Usman A 2011). Commer P., (2013), defined employee commitment as worker’s level of involvement with his job and organization. Organizational commitment can be attributed as employees’ loyalty and faithfulness towards organization and his intensions to be the part of that organization. Organizational commitment has significant importance because committed workers have less intension to quit the job, less often absent and highly motivated to perform at advanced level. An employee’s commitment to an organization is usually a choice that they make depending on their environmental surroundings. Therefore, the study is intended to examine the relationship between transformational leadership and employee commitment.

1.2 STATEMENT OF PROBLEM

An employee’s commitment to an organization is usually a choice that they make depending on their environmental surroundings. Employee commitment as worker’s level of involvement with his job and organization it includes executing defined duties, meeting deadlines, employee competency, effectiveness and efficiency in doing work. Various organizations need strong transformational leadership styles that stimulate the employee commitment. Some organizations such as NNPC Port Harcourt face the problems:

1. a) Poor innovation,
2. b) Low productivity,
3. c) Inability to meet performance targets.
4. d) Inability to achieve departmental goal.

This problems happens due to lack of strategic interventions of specific transformational leadership to the particular situations was predicted as the problem at hand. This problem was continuously affecting employee commitment. That’s why study investigates how transformational leadership stimulates the commitment of employee’s.

1.3 OBJECTIVES OF THE STUDY

The main objective of the study was to investigate the relationship between transformational leadership and employee commitment. The specific objectives are as follows:

1. To examine the relationship between Inspirational Motivation and employee commitment.
2. To examine the relationship between Intellectual Stimulation and employee commitment.
3. To examine the relationship between Idealized Influence and employee commitment.
4. To examine the relationship between organizational culture and employee commitment.

1.4 RESEARCH QUESTIONS

1. Does Inspirational Motivation associate with employee commitment?
2. Does Intellectual Stimulation associate with employee commitment?
3. Does Idealized Influence associate with employee commitment?
4. Does organizational culture associate with employee commitment?

1.5 SIGNIFICANCE OF THE STUDY

The completion of this dissertation will provide understanding of the concept present so as to generate data and information that every planner could use in order to come up with strategies, plans and designs that will strategically position them in the highly competitive, diverse, and complex business environment that is experienced at present.

By fulfilling the aims that were stated in the objectives section, this study will be helpful for other researchers who may be focusing on understanding the concept of effective transformational leadership style. The notable significance of this study is the possibility that other researchers may be able to use the findings in this study for future studies that will create a huge impact on society. This study finding can be used for other findings that might prove to be helpful in introducing changes to the business.

The present study findings have been significant in number of ways. It has been contributed to the body of knowledge by; since the present area is highly under researched in Nigeria and developing countries. No study has been found to investigate the relationship between transformational leadership employee commitments in Nigeria. So, present study suppose that the findings of the present study has been helped the leaders in organization of Nigeria especially in NNPC Port Harcourt and those in developing countries in general to answer the long standing question of how to enhance employee commitment.

1.6 SCOPE OF THE STUDY

This study covered an examination of strategic contributions of transformational leadership on employee commitment of NNPC Port Harcourt, Rivers State as its geographical scope.

The study only focused on exploring how intellectual stimulation, Inspirational motivation and idealized influence.

1.7 LIMITATION OF THE STUDY

In carrying out an investigation of this native the researcher must of necessity be faced the following constraint.

Firstly, the time constraint’s the time frame provision for this study was short.

Secondly, financial constraints. Usually, a study of this nature involved some level of expenditure therefore, finance was also a limiting factor.

Thirdly, poor response from the respondent and inability to access the entire population of the study. In the next segment significance of the study will be discussed. Lastly, poor measurement instrument.

1.7 DEFINITION OF TERMS

EMPLOYEE COMMITMENT: An employee’s commitment to an organization is usually a choice that they make depending on their environmental surroundings.

EMPLOYEES: A person employed for wages or salary, especially at non-executive level.

LEADERSHIP: The action of leading a group of people or an organization, or the ability to do this.

PERFORMANCE: The action or process of performing a task or function.

SUBORDINATE: A person under the authority or control of another within an organization.