Impact of Leadership Styles on Employee Empowerment

By Krishna Murari

The book is based on exploratory research carried out by the author in Indian Business Organizations. The book is based on exploratory research carried out by the author in Indian Business Organizations. It gives insights to Employee Empowerment and five important leadership styles namely Transformational Leadership, Transactional Leadership, Se

• Language: English
• Publisher: STAMPA GLOBAL
• Release date: Dec 10, 2019
• ISBN: 9781951585396

Krishna Murari

The author is presently working as DGM (Quality), CMD, HAL, Bangalore. He is B.Tech. (Mech. Engg.), MBA (Operations Management), Advanced Diplomas in Human Resource and Marketing Management. He has published / presented more than 20 research papers in national / international journals/seminars. He is visting faculty of reputed Mangement Schools. He has received Raksha Manthri Award for Excellence in performance from Ministry fo Defence, Government of India.

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Copyright ©2019 Krishna Murari

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Contents

CHAPTER 1 Changing Business Scenario, Leadership and Empowerment

Changing Business Scenario

Leadership

Leadership and Leadership styles

Empowerment & its importance

Leadership Style and Employee Empowerment

Conclusion

CHAPTER 2 Leadership - Models and Theories

Introduction

Definition of Leadership

Models of Leadership

Leadership theories

Other Leadership Styles

Conclusion

CHAPTER 3 Employee Empowerment

Introduction

Definition of Empowerment

Employee empowerment perspectives

Culture of Empowerment

Empowering Factors identified Various Scholars

Common Empowering Factors

Leadership and Empowerment

Outcomes of Empowerment

Conclusion

CHAPTER 4 Employee Personality and Empowerment

Introduction

Positive Organisational Behaviour

Personal Characteristics of Empowered Employees

Conclusion

CHAPTER 5 Significant Leadership Styles for Employee Empowerment and Their Characteristics

Introduction

Interrelationship of Various Leadership Styles

Limitation of Some Leadership Styles

Conclusion

CHAPTER 6 Initial Conceptual Framework-Leadership Styles, Employee Personal Characteristics and Empowerment

Introduction

Leadership Styles Selected for Study and Their Characteristics

Employee Personal Characteristics

Employee Empowerment Variables

Consequences of Empowerment

Conceptual Framework

Conclusion

CHAPTER 7 Detailed Research on Leadership Styles and Empowerment

INTRODUCTION

Empowerment Variables Selected for Study:

Personal Characteristics of Empowered Employees

Hypotheses

Research Design

Development of Instrument (Questionnaire)

Population and Sampling

Procedure for Data Collection

Reliability of the instrument

Data Analysis and Interpretation

Factor Analysis

Final Study

Factor Analysis

Reliability of Modified Scale

Statistical Tests

Correlation Analysis

Regression Analysis

Conclusion

CHAPTER 8 Transformational Leadership Style, Employee Personality, Employee Empowerment and Consequences

Introduction

Correlation among Transformational Leadership, Empowerment and Consequence Variables

Transformational Leadership Variables and Empowerment

Transformational Leadership and Empowerment

Transformational Leadership, Employee Personal Characteristics and Empowerment

Conclusion

CHAPTER 9 Transactional Leadership Style and Its Relationship with Employee Personality, Employee Empowerment and Consequences

Introduction

Correlation among Transactional Leadership, Empowerment and Consequence Variables

Transactional Leadership Variables and Empowerment

Transactional Leadership and Empowerment

Conclusion

CHAPTER 10 Servant Leadership Style and Its Relationship with Employee Personality, Employee Empowerment and Consequences

Introduction

Correlation among Servant Leadership, Empowerment and Consequence Variables

Servant Leadership Variables and Empowerment

Servant Leadership and Empowerment

Servant Leadership, Employee Personal Characteristics and Empowerment

Conclusion

CHAPTER 11 Abusive Leadership Style and Its Relationship with Employee Personality, Employee Empowerment and Consequences

Introduction

Correlation among Abusive Leadership, Empowerment and Consequence Variables

Abusive Leadership Variables and Empowerment

Abusive leadership and Empowerment

Conclusion

CHAPTER 12 Ethical Leadership Style and Its Correlation with Employee Personality, Employee Empowerment and Consequences

Introduction

Ethical leadership variables and empowerment

Ethical Leadership and Empowerment

Ethical Leadership, Employee Personal Characteristics and Empowerment

Conclusion

CHAPTER 13 Employee Personality

Characteristics Variables and Its Correlation with Empowerment and Consequences

Introduction

Employees Personality Characteristics and Empowerment

Conclusion

CHAPTER 14 Employee Empowerment Variables and Its Correlation with Consequences

Introduction

Stepwise Regression Analysis on Empowerment Variables and Consequences

Empowerment variables and Quality of Work Life

Stepwise Regression Analysis on Empowerment variables and Commitment

Stepwise Regression Analysis on Empowerment Variables and Job Involvement

Conclusion

CHAPTER 15 Testing of Hypotheses

Introduction

Testing of Hypothesis 1

Testing of Hypothesis 2

Testing of Hypothesis 3

Testing of Hypothesis 4

Testing of Hypothesis 5

Conclusion

CHAPTER 16 Modified Conceptual Framework for Leadership Styles, Employee Personal Characteristics and Empowerment

Identification of Empowering Leadership Characteristics

Regression Analysis between Leadership Characteristics and Empowerment

Modified Conceptual Framework

Conclusion

CHAPTER 17 General Conclusions and Implications

Introduction

Conclusions on Research Hypotheses

Implications for Theory

Implication for Results

Limitations of the Study

Scope for Further Research

To my loving wife

Sunita

and my dearest daughters

Richa and Nupur

and

Wonderful Son-in-law

Anupam

For the fulfillment they brought to my life

PREFACE

In this age of globalization, an organisation that wants to be competitive and thrive has to focus on employee empowerment. The success of employee empowerment in an organisation depends on what leadership style it adopts. The various types of leadership styles have different impact on empowerment of the employees. The fast-changing business environment is a major factor in the new emphasis on leadership. However, it has been found that there is no consensus on the definition of leadership among scholars. The characterization of leadership depends on the leader’s abilities, personality traits, influence, relationships, cognitive versus emotional intelligence, focus on individual versus group, and appeal to self interest versus collective interests (Bass, 1990; Yukl, 1994).

Similarly, there are many types of leadership styles indentified by models, theories and various scholars. Research has identified several important leadership styles, such as visionary, bureaucratic, autocratic, charismatic, participative, democratic, laissez-faire, relations-oriented, people-oriented, human relation, servant, task-oriented, transactional, transformational, ethical, abusive, primal, entrepreneurial, holistic, and transcendental. During research by the author, five distinct leadership styles – transactional, transformational, servant, abusive and ethical – have been identified. Every organisation needs to understand them so that it can practice the right kind of leadership style in enhancing employee empowerment and developing a positive environment of success, especially in today’s cut throat competition among local and global markets. This book presents the outcome of a research conducted among high technology-oriented organizations in India, which has been developed using questionnaires that measures the characteristics of five distinct leadership styles, empowerment and consequence variables that are based on ten characteristics of leadership styles identified by various research scholars.

Significance of this book

Literature survey has found that although many researches had been carried out in the fields of leadership styles and empowerment that separately linked these to organizational efficiency and effectiveness, there is still no specific research on the level of significance of a particular leadership style for the empowerment of employees. This is also true on the role of various interventions in overcoming the barriers created by certain leadership styles in the organizations.

Various types of leadership styles have different impact on the empowerment of the employees. Personality traits of the employees also play a significant role in empowerment. One style may be supportive of some of the employees while it may be a barrier for other employees. Self-empowered people can possibly develop into leaders themselves, particularly when they get the support that they need. The opposite can happen under unfavourable leadership from their superiors.

The interrelationship of leadership have been studied and found that there are five styles distinct in nature as follows:

i) Transactional leadership

ii) Transformational leadership

iii) Servant leadership

iv) Abusive leadership

v) Ethical leadership

This book focuses on these leadership styles and their relationship with employee empowerment. Also covered in this book is a discussion on employee characteristics and their impact on leadership and empowerment.

The following are the objectives of the book:

• To explore the impact of various leadership styles on the empowerment of employees;

• To emphasize the employees’ personal traits, which play a significant role in empowerment;

• To highlight how one kind of leadership is supportive of some of the employees while it is a barrier for others.

• To explain the role of various interventions in enhancing empowerment by overcoming the barriers created by certain leadership styles in the organizations;

• To underline the impact of negative and positive roles of various leadership styles on self-empowered individuals.

In the initial development of a framework for the relationship between leadership styles and empowerment, the exploratory research methodology was found to be beneficial as it helped in finding out various possible relationships among different variables. The literature survey was used to examine and compare the various findings for better understanding.

Based on explorative study, the measuring instrument (inventory) was developed to find out the concrete relationship among various leadership styles and empowerment at various levels of managers and employees in an organization using the focused descriptive research.

Significant contributions of the book include:

• Identifying the role of leadership styles in empowerment;

• Developing conceptual framework

• Developing an instrument to measure leadership style and empowerment

• Presenting the effect of various leadership styles on empowerment

• Explaining the effect of intervention like rewards (promotion) on empowerment

• Helping formulation of a strategy for empowering the employees to gain a competitive advantage

These contributions are discussed with the support of facts and figures. Recommendations to organizations are made in order to improve employee empowerment by adopting the preferred leadership style.

The study highlights that transformational, servant and ethical leadership styles increase employee empowerment while abusive leadership suppresses it. Transactional leadership has no impact on empowerment. A certain leadership style can be both supportive and barrier for empowerment. The employee’s personal characteristics play a very important role in empowerment. As a whole, employee empowerment results in job involvement, commitment and work environment leading to a higher performance by the organization.

Outline of the book

The book is divided into the following sections:

Chapter 1: Gives a glimpse of a current changing business scenario and introduces leadership, employee empowerment, and their importance to each other.

Chapter 2: Reviews the relevant literature on leadership and leadership styles, and presents an understanding of various leadership styles, and their relationship to each other.

Chapter 3: Reviews the literature on empowerment, understanding of empowerment. It defines what empowerment is and discusses its culture and factors identified by various scholars. The chapter explains the relationship between leadership and empowerment and the outcome of the latter.

Chapter 4: Identifies different employee personalities and their impact on empowerment, positive organizational behaviour and personal characteristics of empowered employees

Chapter 5: Finds out the interrelationship of various leadership styles and identifies five distinct leadership styles. It also reviews the characteristics of each of these leadership styles.

Chapter 6: Develops an initial conceptual framework among leadership styles, employee personal characteristics, empowerment and its consequences

Chapter 7: Explains the research methodology used in this study. It includes development of the instrument, reliability test for the instrument, procedure for sampling and data collection, methods of data analysis applied in research and interpretation. It discusses the pilot study and establishes the reliability of the instrument for sets of questions related to five selected leadership styles, employee personal characteristics, empowerment and consequences. Final study, factor analysis, reliability of modified scale and correlation analysis with variables related to selected leadership styles, employee personal characteristics and empowerment are also covered.

Chapter 8: Covers correlation among the transformational leadership empowerment and consequence variables, regression analysis between transformational leadership variables and empowerment; transformational leadership and empowerment; transformational leadership, employee personal characteristics and empowerment

Chapter 9: Covers correlation among the transactional leadership, empowerment and consequence variables, regression analysis between transactional leadership variables and empowerment, transactional leadership and empowerment, transactional leadership, employee personal characteristics and empowerment.

Chapter 10: Covers correlation among the servant leadership, empowerment and consequence variables, regression analysis between servant leadership variables and empowerment; servant leadership and empowerment; servant leadership, employee personal characteristics and empowerment.

Chapter 11: Covers correlation among the abusive leadership, empowerment and consequence variables, regression analysis between abusive leadership variables and empowerment; abusive leadership and empowerment; abusive leadership, employee personal characteristics and empowerment

Chapter 12: Covers correlation among the ethical leadership, empowerment and consequence variables, regression analysis between ethical leadership variables and empowerment; ethical leadership and empowerment; ethical leadership, employee personal characteristics and empowerment

Chapter 13: Covers correlation between the employee personality characteristics and empowerment and consequences, regression analysis between employee personality characteristics variables, empowerment and consequence variables and regression between employees personality characteristics and empowerment

Chapter 14: Covers correlation between the empowerment variables and consequence variables, regression analysis between empowerment variables and consequences; empowerment variables and quality of work life; empowerment variables and commitment and empowerment variables and Job involvement

Chapter 15: Covers testing of hypotheses for impact of leadership styles on employee empowerment, role of intervention, effect of personal traits of employees.

Chapter 16: Covers modified conceptual framework for leadership styles, employee personal characteristics and empowerment by identification of empowering leadership characteristics, regression analysis between leadership characteristics and empowerment

Chapter 17: Covers conclusion on research hypotheses, implications for theory, implication for results, limitations of the study and scope for further research

ACKNOWLEDGEMENTS

It is a privilege to thank people for their support and help in this project and in life in general. Without the friendship, humour, cooperation, guidance, and forgiveness of many good people, the dream of writing this book would have not been fulfilled.

I wish to express my appreciation to the many people who provided support to me during my pursuit of writing this book. I am indebted to Dr. K. S. Gupta who has always been available when I needed his guidance. He put up a lot of his time in guiding me, supporting me and providing a path when I saw a wall in front of me. I sincerely thank Dr. N.M. Agrawal, professor, IIM, Bangalore for encouragement and support.

I am thankful to many colleagues in Hindustan Aeronautics Limited (HAL) and other industries who provided support in getting the response to my survey. Specifically, I would like to express my sincere thanks to Mr. Ram Saran Singh, Mr. Sanjay Kumar, Mr. Sanjay Sharma and Mr. K.J. Shivaraju who have wholeheartedly supported me at various stages of my research. I am thankful to the respondents who spared some of their time to provide valuable response for my study.

A special thanks to Mr. P. Soundarajan, Ex. Managing Director, Helicopter Complex, HAL, Bangalore, Mr. V. Sadagopan, Ex-Chief Executive Officer, Helicopter Complex, HAL and Mr. S.V. Suresh, Ex-General Manager, Composites Manufacturing Division, HAL whose leadership styles encouraged me to take up this study.

I express my sincere thanks to Mr. Anantha Agsthya, Ex- Executive Director, HAL Management Academy (HMA), HAL, Bangalore for his wholehearted support and encouragement during my learning and development process and the same sincere thanks to Dr. Srikanth Sharma, Dr. Bharthi for their support during this endeavor.

I am most grateful to my family, to my daughters Richa and Nupur who cheered me up through many years of my adult education, and to my wife Sunita who sacrificed the most for me during the years of my research for the book. Finally, I thank God for giving me strength to carry out this study.

CHAPTER 1 

Changing Business Scenario, Leadership and Empowerment 

Changing Business Scenario 

In recent years, the pace of organisational change has been imaginatively fast, the pressure to compete from outside the organisation has increased. Not to mention, more and more organisations have been operating in a more complex, unpredictable, and dynamic environment. Hence, in today’s rapidly changing and very threatening environments, organisations always harp for the competitive advantage. They understand that they must continually improve the way they organise and manage themselves in order to be successful and competitive. They have realised that organisational competitiveness depends on their capability to prepare their people and design a system for optimal execution of strategy. The growing consensus is that an effective approach to management is a powerful competitive advantage for a corporation (Lawler et al., 1998).

Competing in the global economy of the 21st century is an enthralling concept. Business tycoons, politicians, scholars and individuals have argued the effects of amplified competitiveness. Competitiveness has been subscribed as the antidote to a number of social problems such as unemployment and inflation which are the causes for developmental roadblocks, communal sclerosis and regional tension. Yet, stimulating and ambiguous arguments are heard from organised labour, environmentalists, cultural campaigners and supporters of nationalism. The pandemonium that appeared during the WTO meetings in Seattle, and the protests that occurred in Washington at the IMF and World Bank annual meetings (Bernstein, 2000; Cooper & Phillips, 2000), is expounding of the strong feelings related to globalisation, open markets and increased competitiveness.

The concerns related to removing farm subsidies, cutting down tariffs on goods and services, removing taxes and regulations for e-commerce, provisions for environmental protections in the trade agreements, guidelines for bio-engineered foods, guarantee for labour rights, implementing stronger antitrust rules, and reexamination of current investment rules are raised. However, developing nations want more relaxation in anti-dumping enforcement, the design of special policy for developing nations, the opportunity for export markets for farm goods, garments and textiles, and the restraining of intellectual property protection.

For the past twenty years, companies have invested in technology as they felt that technology would provide competitiveness. Unfortunately, they found that anyone can acquire and utilize the latest technology. The fact is that competitors reproduce most technological advances within a year. This is applicable for both products and processes. As a result, the competition for technological dominance usually ends in equivalence. Technology may be desirable in order to stay in the competition, but by itself, technology is hardly ever the main basis of competitive success. Hence, the means which are the source of competitive advantage must be found somewhere else.

Globalisation and growing interdependencies forced new game plans. Wealth of nations, competitiveness in global market, the richness of the projects and amalgamation within worldwide value chains result in an increase in competitiveness worldwide.

The industry sectors of the state’s economy contribute by the expansion of their competitiveness on GDP growth and supplementary value, while other things bring their support by its developed action on:

• Increasing the quality of life by providing health, culture, social assistance,

• Developing a competent labour force,

• Guarantee of the proficient execution of justice system,

• Security of private rights and of citizen’s protection,

• Declining the criminality rate,

• Dipping the risk of political unsteadiness,

• Expanding social solidity,

• Reducing social inequality, and

• Reducing unfairness against women and minority groups.

In this age of globalisation, there is necessity of employee empowerment in the organisation so that employees will be able to make quick decisions and take action quickly on any changes in the business environment. Organisations which are committed to employee empowerment are able to motivate and retain their employees. Nevertheless, employee empowerment is a complex management tool which needs to be cultivated and used with a lot of care. Employee empowerment pilots for enhancing productivity, performance and job satisfaction. In a free market economy where there is unrestricted competition, challenges to offer quality products and services, high-level innovativeness and chaotic changes in the macro-environment, employee empowerment is very much required. The employee empowerment literature emphasises that empowered employees will lead in achieving a competitive advantage (Conger and Kanungo, 1988; Quinn and Spreitzer, 1997; Sundbo, 1999; Forrester, 2000).

Scholars and leaders worldwide have prescribed for the empowerment of employees to assist their organisation to compete effectively in the highly competitive environment. In spite of the appeal of empowerment, many employees do not experience empowered by their managers. Research has not made much clear the circumstance under which managers are enthusiastic and able to empower employees. Researchers have called for further assessment of the past history and individual characteristics on empowerment, as well as development of the concept of leadership.

Leadership 

Leadership is the ability to influence people towards the attainment of organisational goals. The dynamics of the leadership process occurs among people. The management power promotes stability, order, and problem solving within the organisation, whereas the leadership power promotes vision, creativity, and change in the organisation.

In early stage of the development of leadership concept, many scholars scrutinized great leaders in the history and tried to find out their traits. The personality traits which were found to be important include personal integrity, emotional steadiness, diplomacy, self-confidence, determination, uniqueness, ingenuity, and scholarly capability such as the ability to judge, knowledge, and verbal communication skill. Important physical traits include age, height, weight, and physical magnetism. The role of leadership in business is unquestionable. Great leaders create great business and ordinary leaders create ordinary business.

There is no agreement on the definition of leadership among scholars. Definitions vary in terms of stress on leader capability, personality traits, persuading relationships, cognitive versus emotional inclination, individual versus group’s inclination and appeal to self versus collective wellbeing (Bass, 1990, Yukl, 1994).

Barrow (1977), Cartwright & Zander (1998), Hollander (1985) define leadership as a reciprocal process. Any characteristic of the leader, group member or change in conditions can affect and be affected by other variable in the system. An instructional view assumes that leadership is a fluid, dynamic process involving continual adjustments among the three elements. Leadership is a transactional process (Burns ,1978, Hollander & Julian ,1969 and Pigors, 1935). The leader and follower relationship is a form of social trade; leaders and followers operate their time and energy in gaining financial and social benefits. On the other hand, Bass (1985) and Bass et al. (1987) detail that leadership is frequently a transformational process. The transformational leader amplifies followers’ inspiration, self-assurance and fulfilment by uniting them and transforming their beliefs, values and requirements. Grimes (1978) explains that leadership is a supportive process of genuine influence than absolute power.

Few leaders recognise the complete implication of leadership style’s influence on the performance and fulfilment of their employees. Leaders manage interpersonal, as well as monetary rewards and punishments which form employee behaviour and manipulate an employee’s performance, enthusiasm, and mindset. They can influence an employee’s personality and consequential potential in either a positive or negative way by being encouraging, fair, and supportive; or unsupportive, incoherent, and critical. In addition, a leader’s behaviour has an impact on employee’s health and energy level. The power of a leader’s style reaches greater magnitude as its effects on subordinates begin to have a snowballing effect on group performance. However, there are other variables other than a leader’s style that influence employee performance and satisfaction. Definitely, job challenge and significance, organisational work environment, growth and developmental opportunities, and peer relations, etc. should also be considered. However, the prospective consequences of a leader’s style should be understood and not be taken too lightly (Warrick,1981).

Leadership and Leadership styles 

A leader is an agent of change, and progress is about change. In the words of Robert F Kennedy, Progress is a nice word; but change is its motivator. Leadership is about raising the aspirations of followers and enthusing people with a desire to reach for the stars. For instance, Mahatma Gandhi created a vision for independence in India and raised the aspirations of Indians. A leader has to raise the confidence of followers. He should make them understand that tough times are part of life and that they will come out better at the end of it. He has to maintain their hope, and their energy levels to tackle the difficult days. The leader has to create optimism. He has to create a believable story about a better future for the organisation, everyone should be able to see the rainbow and grab a part of it. (Narayan Murthy, 2005)¹

Increasing competition, a global economy, and rapid technological change require organisations to innovate continually and be flexible in order to survive. This requires a mindset and lived realities throughout the organisation. People are the most important asset of an organisation. One’s technologies, products and structures can be copied by competitors. No one, however, can match highly charged, motivated people who care. People are the firm’s depository of knowledge and central to the organisation’s competitive advantage. In today’s highly competitive and fast moving world, organisations need highly educated, trained and motivated workforce who can help in development and creativity. Also, they should be able to execute the strategies to assure the competitiveness of the organisation (Spreitzer and Quinn, 2001).

Leadership styles are crucial to success. We find ourselves taking leadership roles at one point