The Role of Transformational Leadership on Employee Performance: A Perspective of Employee Empowerment

Abstract

Critical literature review revealed that individualised consideration and intellectual stimulation factors of transformational leadership are the heart of employee empowerment. This study is important because there was little and discrete information on how individualised consideration and intellectual stimulation empower the performance of banking sector employees in the Dar es Salaam city. The study, therefore, examined the role of transformational leadership on employee performance based on employee empowerment perspective. A sample of 325 banking sector employees was surveyed using a self-administered structured questionnaire. Multiple linear regressions were employed to find the relationship between individualised consideration and intellectual stimulation with the performance of banking sector employees. A Statistical Package for Social Sciences was employed as an analytical tool for quantitative data. An in-depth interview was conducted to twelve employees who were selected by using the purposive sampling technique from twelve different banks. Thematic analysis was used to analyse qualitative data from in-depth interview to supplement the quantitative findings. The study revealed that individualised consideration and intellectual stimulation had a positive relationship with the performance of banking sector employees. That relationship was enhanced by effectively empowering employees and also fostering an environment that encourages learning, creativity and innovation. The study recommends that leaders in any bank’s section have to empower employees and foster the learning, creativity and innovation environment as the preconditions for enhanced employees’ performance. However, the study was done in the Dar es Salaam city and therefore limiting the generalisation of the results due to contextual differences in sub-Saharan countries. The study contributes to knowledge that individualised consideration and intellectual stimulation factors of transformational leadership are the heart of employee empowerment.

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“…Next, this study finds that employee performance is significantly improved by transformational leadership. This finding is in line with the previous study by Magasi (2021) who conducted research in the banking sector. He concluded that intellectual leadership is the heart of empowering employee performance and suggested that the most appropriate employee performance indicators are quality and reliable products, quality and reliable financial services, quality and reliable markets, quality and reliable technology, multiple products, portfolio, and effective feedback from customers.…”

“…According to Chen et al (2021), Tuzzakiyah et al (2021), Hassi (2018), andAndreani et al (2016), transformational leadership is positively connected to employee satisfaction via the mediating role of the experienced relationship climate perceived by employees. Further, Yucel (2021), Magasi (2021), Kimani (2021), Riyanto et al (2021), Farisi et al (2020), and Andreani et al (2016 all found significant results and a positive relationship between transformational leadership and employee satisfaction.…”

“…This is in line with Yucel (2021) who discovered a significant and positive relationship between transformational leadership and employee performance and concluded that leaders must lead the team by increasing employee involvement to achieve company goals effectively and efficiently, such as by building good image, development, productivity, and profitability. Magasi (2021) affirmed that intellectual leadership becomes the heart of empowering employee performance and suggested that in the context of the banking industry, quality and dependable products, quality and reliable financial services, quality and reliable markets, quality and reliable technology, many products, portfolios, and effective client feedback are among the most appropriate employee key parameters. Meanwhile, Farisi and Paramita (2020) stated that the performance indicators are 1) quality, 2) quantity, 3) time, 4) emphasis on cost, 5) supervision, and 6) relationship between employees.…”

The influence of entrepreneurship education on entrepreneurial intentions

“…In a similar vein, the literature supports that psychological trait such as creativeness, innovativeness, locus of control, self-efficacy, risk-taking propensity, passion, need for resilience, passion and tolerance for ambiguity, predict well the entrepreneurial orientations (Baron, 2000;(Bygrave, 1989;Sánchez, 2015). Similarly, Magasi (2021) asserts that creating new ideas, imagination, creativity, independent thinking and changing own ideas into products and reality are the foremost factors for competition-winning, organization's superior performance, and business sustainability. Barba-Sánchez and Atienza-Sahuquillo's (2018) findings also show that a strong need for independence is one of the most important factors for entrepreneurial intention.…”

The Impact That the Application of a Certain Leadership Style Has on the Performance of Employees in the Catering Sector

“…Measuring the effectiveness of this leadership style is based on the degree of influence the leader has on employees Tajasom (2015) [14]. According to Khan, Anjam, Faiz and Khan (2020) [15] many leadership styles are related to increasing the performance of an organization. The level of job satisfaction is one of the key elements to measure performance in an organization.…”