Current Leadership Styles At Mtc Namibia Management Essay

Facebook, Twitter, WhatsApp, BlackBerry messaging these applications are used, hourly actually they are accessed minute after minute with instant updates regarding the status of family, friends and colleques. All these communication is currently accessible via mobile phones, one of the fastest growing industries, and one that touch the lives of millions on a daily basis.

The company under question is currently the leader in the mobile telecommunications industry in Namibia. Some might even refer to the company as the main player in the telecommunications industry in Namibia. A new entrant in the mobile space entered the market about 5 yeas back and for brief moments there were real competition in the market. Competition in the industry is almost non-existent, but the playing field is changing and the market is gearing itself for competition amongst the major players, but new players are also entering the market.

The company in this study is doing well financially; the company is growing and expanding almost every day. As stated, there is no real competition in the market – is the management team of the company ready to face real competition from old and new players? Are they ready for the new competitive arena, or are they riding the wave of the successes from previous years?

It is necessary for the company to understand the changes in the arena of the industry. The company requires the management team to be ready for the new challenges. The aim of this study is to analyse the leadership styles, compare this with various other studies and eventually predict if the current leadership styles from the management team is indeed good enough to move the company into the next decade in the telecommunications industry in Namibia. Are the leadership styles of the management team sufficient to thrive or just survive?

Chapter 1: Introduction

Orientation of the proposed study

Namibia is a very small country and due to our short history, the main studies in the leadership field focused traditional leadership. Limited research has been done in the area of leadership styles in the country. One of the most recent studies regarding leadership styles focused on the leadership styles of 148 middle managers in Namibia, in the Windhoek area. The study focused on the relationship between emotional intelligence and leadership styles of these managers. The study matched the emotional intelligence orientation of the individuals with leadership styles in order to draw a conclusion / link between the two fields of study. (Hoffman, 2012)

Some of the major findings by (Hoffman, 2012) Still need to fine tune this

H1: There is a significant relationship between EI traits and leadership styles. Hypothesis 1 can be partly accepted as there is a significant positive relationship between Emotional Intelligence and Transformational Leadership and a significant negative relationship between Emotional Intelligence and Laissez-faire style. Transactional leadership style does not correlate significantly with Emotional Intelligence and needs thus be excluded from the hypothesis.

H2: There is a significant relationship between EI traits and Laissez-faire leadership style. A definite relationship has been found. It needs to be pointed out though that the relationship was a negative one. Causality needs to be evaluated under regression analysis to determine if low emotional intelligence can culminate in a passive leadership style.

H3: There is a significant relationship between EI traits and Transactional Leadership style. There is no significant correlation between Emotional Intelligence and Transactional Leadership styles. This style has the possibility to flow to both sides of the spectrum. It seems that the negative correlation that has been found with Laissez-faire style and emotional intelligence is loaded on some of the factors. The hypothesis needs to be rejected as emotional intelligence did not seem to correlate with this style.

H4: There is a significant relationship between EI traits and Transformational Leadership style. Hypothesis 4 is accepted due to a significant correlation between this leadership style and the Emotional Intelligence scores. The intensity of the correlations is higher than .30 and can be regarded as strong.

This study will focus on a smaller population, the management team of MTC Namibia. The aim is to understand the leadership styles of the management team. One aim of the study is to understand / test if the leadership style of the management team is conducive to ttake up the challenges that the company might face within the next few years. With this study the researcher will include middle, senior and executive team members in the population.

Statement of Problem

The company in this study is doing well financially; the company is growing and expanding almost every day. As stated, there is no real competition in the market – is the management team of the company ready to face real competition from old and new players? Are they ready for the new competitive arena, or are they riding the wave of the successes from previous years?

The researcher want to analyse the leadership styles of the management team in the company and compare the outcome of the leadership style questionnaire with the best of breeds in order to predict if the current leadership styles are sufficient for the challenges that the company face. The main purpose of the study is to analyse the leadership styles of the management team, and based on the results, if there are gaps, make recommendations that can be implemented in the company in order to improve the leadership styles.

Objectives of the study and research problems

Brief objectives of the study

The Multifactor Leadership Questionnaire (MLQ) from Bruce J. Avolio and Bernard M. Bass is one of the most widely used tools for used for analysing Leadership styles, with a focus on Transformational, Transactional and Laissez-faire leadership styles. The researcher will analyse the leadership styles of the management team based on the MLQ. The aim is to analyse the current leadership styles and to not single-out the individuals that does not display the best of breed leadership styles, the aim of the study is to create a benchmark for the current leaders and to provide recommendations as to how the company can implement changes in order to improve the leadership styles and the leadership effectiveness of the various team members. Leadership styles will be compared with an MTC Internal 360 degree questionnaire that is completed by the staff of the management team twice a year

Questions that the researcher want answered:

What are the Leadership styles of the Management team in the company? What style is the most prevalent leadership style?

What is the possible impact of the current leadership styles on the performance of the company?

Based on the various Leadership styles, is the management team ready to face the obstacles of the rapid changes in the industry? Will I have enough time for this?

Based on the various leadership styles what is the status of the quality readiness (effective leadership) of the management team within the company. Will PMAT vs leadership style give me this?

What possible changes / improvements should be introduced in order to equip the management team even more for the challenges in the industry.

Significance of the study

The ICT industry is rapidly changing, telecommunications forms part of this industry. The researcher, with this study, wants to highlight and promote firstly to the company in question, and secondly to the industry, a guideline as to what leadership styles is conducive to the type of environment. The researcher also wants to challenge the company, and the industry, to train and mentor the leaders within this industry if the company, and the industry wants to achieve continuous growth and improvement

Limitation of the study

The main limitation of this study is the time-frame allocated in order to complete the study. The study needs to be completed within a period of roughly 75 days. The researcher, once the proposal is approved, need to purchase the various instruments that will be used for data collection for this study, this in itself is a limitation as the financial implications for these tools is very high. Most of these instruments can be acquired via the internet and should be paid in US Dollars.

The researcher will focus on a management team within MTC Namibia. The management team of MTC Namibia is mostly centralized in the city of Windhoek. The management team will include members from middle management, senior and executive teams but the survey will exclude the MTC Namibia board members. Staff members in the company that does not have the word “manager” in the title of the position will not be included in the survey.

Literature Review

Review of Leadership Theories – last decades

Leadership has been the centre for numerous studies over the last few decades. Various studies focused on what traits of a leader, or leadership style sets that individual or individuals apart from others. Why are certain leaders great and stand out amongst the masses? Literature reviews of leadership theories make it clear that over the decades various “School of Thoughts” (Bolden, Gosling, Marturano, 2003) evolved over the decades. The various schools of thought are mainly categorised based on the main traits that defines the leader. Main areas of thought are: Great Man Theory, Trait Theory, Behavioural Theories, Contingency Theories, Transactional Theories and Transformational Theories (Leadership-Central, 2012). According to the study by Bolden et al., 2003 there is another theory that should slot in between the behavioural and the contingency theory, this theory is called the Situational Theory. In total there are 7 main theories from Great man theories to transformational theories.

Let us review a short summary of the mentioned theories:

Theory

Main point of focus

Great man Theory

Great leaders are born with the ability to lead, these individuals are exceptional and they were destined to be leaders. The term “man” was used intentionally until the latter part of the twentieth century as leadership was seen in the context of male, military and in the western society. Some leaders that fall in this category are: Alexander the Great, Julius Caesar, Napoleon, Queen Elizabeth I, and Abraham Lincoln

Trait Theory

According to the trait theory the leaders have the deep-seated traits that give them the power to be leaders. Some of these traits are assertiveness, dependability, persistence and adaptability it is convenient to list the elements that Ralph Stodgill (1974), the originator of the trait theory, determined. B.F. Skinner argues that the traits can be trained and behaviour can be adjusted. This is in contract with the theory that sates the trait is “innate”. According to (Goffee & Jones, 2011) leadership theory research started in all earnest in the 1920s. This theory made an effort to identify and categorise common characteristics that were found in effective leaders. Leaders were subjected to various psychological tests they even went to areas such as weighing and measuring leaders in order to search for these common characteristics. The decline in the support for the trait theory started when the conclusion from expensive studies showed that “…effective leaders were either above-average height or below” (Goffee & Jones, 2011, p. 53)

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Behavioural Theory

The Behavioural theorists analyse leaders based on the behaviour of the leader. The use the behaviour of a leader in order to analyse and predict how successful or influential such a leader would be. This theory lends itself to the discussion that the behaviour of a leader can be adjusted and a leader can be trained on how to change his or her behaviour based on the situation or external factors.

There are two main behavioural study theorists, Ohio State University (1940) – The created the Leaders Behavior Description Questionnaire (LBQD) They used 150 different statements that measures nine different behavioural dimensions of leadership. After analysing the responses to the questionnaire from various respondents it was clear that there are two different behavioural orientations in leadership: Task orientation and People orientation. Task orientated leaders focussed on control, the procedure and the organizational structure.

Situational Theory

Kenneth Blanchard and Paul Hersey pioneered the situational leadership style theory. The theory states that the same leadership style cannot be applied in all circumstances. The pioneers state that leadership style will change depending on the situation or circumstance the leaders finds themselves. There are 4 different styles of leadership under this theory:

S1: Telling – these leaders are constantly telling their staff hoe, why and when task have to be performed

S2: Selling – Communication is two ways between leader and staff member, the leader provide controlled direction to staff members. The leader assures that he / she has buy-in from the team members in order to reach the required output.

S3: Participating – the leaders seek the opinion and the participation of the team members as solutions as how tasks should be performed.

S4: Delegating – here the leader is involved in making the decision, but the responsibility on how the task will be completed is passed on to the staff member. the leaders only reviews the progress of the task and is not actively involved.

According to this theory, the leaders should analyse and investigate the current situation and then apply a leadership style that is best suited to the situation. The leadership style that will be used is also dependent on the level of development of the staff member

Contingency Theory

The main aspect of this theory is that there is no one leadership theory. In every leadership situation there will be a difference in the leader, the followers and the circumstances or situation – all these variables will be unique. “Common sense dictates that a leader, in order to continue being one, will have to adjust to what happens in the environment, that is, contingencies” (Leadership Theories, 2012)

A list of the major contingency theories are:

Strategic Contingency Theory

Fielders’ Contingency Theory “group performance depends on leader’s psychological make-up, as well as group atmosphere, task, and the leader’s power position”

Hersey & Blanchard’s situational theory

Vroom and Yetton’s decision participation contingency theory – decision quality, acceptance by the audience, amount and quality of information available to leader, integrity of hierarchy

Other categories of contingency are:

Behavioralism

Tasks

Organizational (system) integrity

System environments

Transactional Theory

“Punishment and reward motivate people and this underpins transactional leadership theories” (Leadership Theories, 2012) According to the author, there must be a structure where it is clear who the leaders are and who the followers are. The subordinates need only to obey their leader; nothing more is required. Whether they can actually accomplish the task is irrelevant” (Leadership Theories, 2012). “An overlap exists between transactional leadership theories and contingency leadership theories in that both aver that the circumstances, or context, dictate leadership style” (Leadership Theories, 2012) This leadership styles are also seen as a “totalitarian dictatorship” (Leadership Theories, 2012). The manager instructs the follower to perform a certain task -“…no questions asked” (Leadership Theories, 2012) This theory puts much emphasis on the relationship between the leader and the follower. (Bolden, Gosling, Marturano, & Dennison, 2003)

Transformational Theory

The focus of this theory is that the community is more important than the individual. The individual operates in the structure of the organization or community. “There is an emphasis on cooperation and collective action and stress is included in the long-range goals of an organization. Individuals exist within the context of the community, rather than competing with each other.” (Leadership Theories, 2012)

Source: (Bolden, Gosling, Marturano, & Dennison, 2003), (Leadership Theories, 2012)

The earlier theories are mainly concerned with the behaviour and the character of leaders, the later theories started focusing on the contact in which the leaders leads. The later theories also started to consider the role that is played by the followers of these successful leaders. Whereas the foundation of the mentioned theories is in the management sciences, there is a new theory developing called ‘dispersed’ leadership, the foundation for this new theory is mainly in the sociology, psychology and politics sciences. (Hogg, 7 Must Have Transformational Leadership Qualities, 2012). These new theories focus more on the fact that role of leadership is distributed in an organization and that is not solely the roll of the designated leaders (Bolden, Gosling, Marturano, & Dennison, 2003). In this study however I will focus more on the traditional theories on leadership and the leadership styles of the individual leaders ta the company

Transformational leadership is more need today than ever before. We need leaders that are courageous that can empower other people to reach heights they never thought is possible. Leaders should leave the arena of transactional leadership and move into a new arena of transformational leadership. Leaders should start looking at solutions for the long term and not be short sighted and only focus on immediate gains. Leaders need to start to focus and build their capacity in order to become transformational leaders. (Hogg, 7 Must Have Transformational Leadership Qualities, 2012, p. 1)

Methodology

Research Design

The researcher will follow a structured approach in order to collect the data. The Multifactor Leadership Questionnaire (Mind Garden, 2012) is a quantitative research Instrument and us one of the best in the world in order to measure the different leadership styles. The instrument assists leaders to understand how they measure-up with others. Re-testing is also allowed in order to track changes in leadership. If the proposed instrument is not available, the researcher will use another “free” qualitative research instruments. The main aim is to use instruments that have been proved, tested and verified in the industry in order to have reputable results.

Population

The population of the study is the MTC Namibia Management team. In total the population size is about 35 team members.

Sample

The researcher will make use of the “Convenience Sample” Technique. The researcher will first inform all the subjects about the research to be done. During this information session / notification it will be made clear that all information will be kept confidential. The researcher will then send an online questionnaire to the sample group.

Research Instruments

The researcher will use a questionnaire from current published leadership style and quality leadership publications and analyse the feedback based on the specific publication. Various instruments are available in the market. During the research the researcher came in contact with the following instruments. Some of these instruments does carry a huge cost and the researcher is in the process of negotiating the opportunity to possibly use some of these instruments:

The researcher will follow a structured approach in order to collect the data. The Multifactor Leadership Questionnaire (Mind Garden, 2012) is a quantitative research Instrument and us one of the best in the world in order to measure the different leadership styles. The tool assists leaders to understand how they measure-up with others. The researcher will use the standard measurement tool that includes 45 questions. The portion of the instrument that will be used is the section where leaders should describe their own leadership style as how they perceive it.

The Performance management assessment instrument (PMAT) from MTC is an internal 360 degree tool. MTC only use the portion where staff rates managers and the scoring is done twice a year, in March and again on October. The researcher will require the respondents to include their PMAT scores for the period October 2011 and March 2012. The following are measured by the PMAT scoring system:

Measures the setting of outputs and key performance areas (KPA)

Measures the Quality of the interaction that was had with staff

Measures the understanding of the process by both manager and employee

Measures the Understanding of the forms

Measures the use of the ranking and rating process

Measures on-going coaching and development

Procedure

The researcher will make the MLQ instrument available to the internal team via an internal survey website based on Microsoft SharePoint technology. The survey will be send to the participants via an internal email system. The system will only allow each participant to complete the survey once.

Chapter 2: Literature Review

Theories of Leadership

The literature review of leadership, according to Bolden et al (Bolden, Gosling, Marturano, & Dennison, 2003, p. 6) will make it clear that there are various “Schools of thought”. As mentioned earlier the main schools of thought are: Great Man Theory, Trait Theory, Behavioural Theories, Contingency Theories, Transactional Theories and Transformational Theories (Leadership-Central, 2012) as described in Chapter 1.

Phases of leadership

Before one get into the theories of leadership, it is good to understand that there is a leadership timeline that include three different phases ( (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009, p. 556). These phases explain the “metamorphoses” or process a leader needs to undergo in order to become a leader of the future. This process is “…in line with Koselleck (1985, 2002), and it defines and captures human development fuelled by the vision of possibilities” (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009)

Figure The Leader’s Timeline

(Isaac Mostovicz, Kakabadse, & Kakabadse, 2009)

The past

One of the questions asked about leadership is what makes a good leader and “…what qualities do an ideal leader require?” one of these qualities as first stated by Goleman and is “self-awareness” which we define as “having a deep understanding of one’s emotions, strengths, weaknesses, needs, and drives”. (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009). Based on this definition it is clear that a leader should have a clear understanding of their values and also about their own goals. Leaders need these qualities in order to communicate their emotions and goals clearly and openly to those around them. This ability to put ones emotions and goals into words is a difficult challenge for most humans, according to (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009) where they cited Niemeyer et al., 2001

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The present

The present phases is described as the area of control or the area in which a leaders functions. Empathy is one of the skills required and found in leaders, Goleman defines empathy as “the ability to understand the emotional makeup of other people” and “the skill of treating people according to their emotional reactions” (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009, p. 566) The challenge is that leaders often does not even understand their own values, goals and purpose these constraints make it difficult for leaders to emphasize with other having the same difficulties.

The future

“Humans need a purpose” people are unique and each person searches for his or her own unique purpose in life. This statement links back to the basics of Judaism: “the foundation of Judaism and the basis of all true religions is the realization that existence is purposeful, and that man has a purpose in life” (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009). This notion of man searching for purpose in life is also supported by cognitive psychologists. One of the qualities of a leader is maturity; maturity is much needed in order for leaders to keep on focusing and searching for a goal. The searching for purpose is linked to that a marathon runner. Running a marathon requires the ability to focus on a goal that does not become clear until the very end. Runners need to focus not on the target, but on the act of running, until the end goal becomes clear, or more visible. Marathon runners are mostly older than the runner that takes part in short distance events, this is the same for leaders: “…leaders’ applied abilities improve with age because they have stronger mental stamina.” Another leadership trait is motivation, motivation is defined as” “passion to work for reasons that go beyond money and status” (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009, p. 567)

Four Popular Myths about Leadership

In their research and consulting work, Goffee and Jones (Goffee & Jones, 2011, p. 55) have come across executives that do not have a clear understanding of what qualities is need for an inspirational leader. Below is a short discussion of the most common myths that executives have about leadership:

“Everyone can be a leader – Not True”

Leadership requires executives to have traits or behaviours or one can even call it abilities to know you and to be truthful – many executives do not have these abilities. These are not the only two traits, many talented and promising individuals do not want to become leaders, they do not want to carry the burden of leadership. Many other individuals do not want to spend too much time on their work, they want to balance their work-life time, and being a leader will mean that you spend more time at the office. (Goffee & Jones, 2011, p. 55)

The notion that some people do not want to lead was also findings by Howard and Wilson (1982). Their findings showed that leaders must have an urge or aspiration to lead. If a leader wants to be successful, then the leader must have the will to lead. The right training and skills will not guarantee the success in a leadership position if the person does not have the motivation to lead. (Henman, 2012, p. 9)

“Leaders deliver business results – Not always.”

How easy would it be if we could use company results in order to classify and identify good leaders, this would have made it very easy to “head hunt” your next leadership team, unfortunately finding good leaders is much more complicated than that. Companies with relative competent mangers deliver excellent results, and companies with exceptional leaders do not always deliver the best results, especially not in the short term.

“People who get to the top are leaders – Not necessarily.”

One main misunderstand of leadership is that people on leadership positions are indeed good leaders. Being in a leadership position can be a result of family links or political links and not necessarily because of good leadership skills. Leaders are not only found in the top structures of organizations. Looking at the definition of leadership, it states that leaders are people that have followers, and that rank and position does not have anything to do with it.

“Leaders are great coaches – Rarely.”

There is a perception that good leaders must also be good coaches. This statement adopts the viewpoint that one person can motivate or inspire individuals as well as teach them the necessary skills to excel at their jobs. This is very possible, as stated by Goffee & Jones, but it happens only occasionally. Leaders like Steve Jobs “…strengths lie in their ability to excite others through their vision rather than through their coaching talents.” (Goffee & Jones, 2011, p. 55)

The leadership challenge

In the study of (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009, p. 102) they refer ot a study that was done by Kakabadse and Kakabadse’s (2007) in this study it was clear that not all individuals that occupied leader positions actually led. Most of the individuals in the study saw their role as a leader as one of pleasing shareholders or by being more concerned about their own reputation. Appointing leaders is becoming a very challenging task. Leaders are more and more aware of the demands that come with leadership positions. Many of these leaders opt for a work life balance rather than applying their leadership skills in the field of business management (Goffee & Jones, 2011)

Being leaders imply that there is a drive and continual process of purpose seeking. Although much effort might be spend in building legacies, a leader’s commitment to purpose seeking goes much deeper. This commitment to purpose seeking must not be confused with a concept from a leader that it is my way or the high way, it does not imply that what is not the way of the leaders is wrong. The total commitment to this process takes a lot of motivation – just at the marathon runner needs to focus a distant goal. The leaders must stay true his / her viewpoints but is also required to have an understanding of the viewpoints of others. This respect that the leader has for others is called empathy or what Lorenz (1974) calls a bond associated with being both non-hierarchical and non-distancing. (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009, p. 571) In their article (Isaac Mostovicz, Kakabadse, & Kakabadse, 2009) refers to Wilson that stated empathy requires three qualities: avoidance of distancing, respect for the integrity of the other; and harmonious aggression.

Leadership styles

After a brief introduction into leadership styles in chapter one, it can be said that a board of directors of a multinational or a small medium enterprise owner will favour the leadership theories such as transactional and transformational leadership styles. As discussed by (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, p. 102) Burns, 1978 generated two aspects that helped differentiate between “ordinary” and “extraordinary” leadership namely transactional and transformational leadership. Transactional leadership is the standard concept where the compliance of people (effort, productivity, and loyalty) is rewarded. Transformational leadership make clear the importance and the value of a certain outcome to his / her followers as well as guide them on how this can be achieved. This process of making followers consciously aware of the value and goals of the firm makes followers perform beyond expectations as first stated by Burns, 1978; Bass, 1985 (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, pp. 102-103)

Burns (1978″…observes that transformational leadership involves the process of influencing major changes in organizational attitudes in order to achieve the organization’s objectives and strategies” Bass (1985) observed that transactional leaders followed standard policies and procedures in order to change the organizational cultures whereas the culture change were transformational leaders are in the lead, change the culture based on new vision, and a rethinking of current assumptions as well as the values and norms. (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, pp. 102-103)

Look at the history and time-line of transactional, transformational theories

Transactional, Transformational and laissez-faire leadership styles have had various changes over the last few decades. Burns 1978 “…distinguished between characteristics of transformational and transactional leadership.” (Sahaya, 2012, p. 97) Bass 1985 from the outset worked the six-factor model of leadership. Bass and Avolio 1990 suggested that the characteristics of Transactional and transformational leadership styles had a nine-factor model. Avolio and bass in 1991 proposed the “Full Range Leadership Theory” the building blocks of this theory were transformational, transactional, and no transactional laissez-faire leadership, these were again broken down in nine different factors.

Numerous researches used the nine-factor model for their research while others removed or added items from the nine-factor model for their own studies. The nine-factor model also known as the full range leadership model was revised by Bass and Avolio (2004). Transformational leadership have five different factors: idealized influence (attributed) idealized influence (behaviour), inspirational motivation, intellectual stimulation, and individualized consideration. Transactional Leadership style has two factors: contingent reward and management-by-exception (active), and laissez-faire has two factors as well namely management-by-exception (passive) and laissez-faire leadership style. (Sahaya, 2012, p. 97)

Transformational leaders have in general a positive effect on the followers especially as far as moral, morals and motivation is concerned. Transactional leaders on the other hand focus on the immediate self-interest of their followers. Bass summed it up as follows: “…transformational leader emphasizes what you can do for your country; the transactional leader, on what your country can do for you.” (Bass, Two Decades of Research and Development in Transformational Leadership, 1999, p. 9)

In most studies transactional and transformational leadership styles are discussed as almost two sides of the same coin, it leaves the impression that the one cannot survive without the other the researches will however split transactional and transformational leadership and discuss explicit viewpoints regarding each, before combining the discussion as it appears in literature.

Transactional Leadership

Transactional leadership according to Boehnke et al, 2003, is described as a process of exchanging where the followers comply with the request from the leader. Actors need to complete their task in order to achieve the organizational goals. The transformational leader must make sure the actors clearly understand how to achieve the given objective or goal as well as keep the actors motivated during the process. Transactional leadership is based on the process of clarification of goals and objectives as well as giving credit once these gaols are achieved. The transactional leader closely monitors the progress and act immediately if there are any problems that might occur. The leader will take immediate actions when problems are identified. (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, p. 104)

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Burns (1978) viewed Transactional leadership as an exchange of rewards for the performance of followers. Bass (1985) defined that “Transactional leadership is the essentially exchange-oriented base.” (Sahaya, 2012) Waldman noted that this exchange of are focussed on short-term goals (Sahaya, 2012)

Transactional leadership style comprises of two main factors, contingent reward and management-by-exception (Bass & Avolio, 2004). (Sahaya, 2012, p. 98) Summed it up as follows:

“Contingent Reward: Leaders, who have behaviours of expectation clarifying, negotiation, promises making, and contingent rewards offering to followers when the goals are achieved (Bass & Avolio, 2004).”

“Management-By-Exception (Active): Leaders, who have behaviours of active monitor for errors, concentrate on the mistakes and deviations from standard of task, and take immediate actions when the irregularities occurred (Bass & Avolio, 1994)”

Bolden et al published a summary from Covey, 1992 in order to explain the difference or rather to compare or contrast transactional and transformational leadership styles. In this study it is argued that Transactional leadership focussed on the “bottom line” of companies, whereas Transformational leadership focusses on the “top line” of companies. According to Bolden et al both leadership styles are necessary. Many companies have not yet taken on the challenge to move to transformational leadership style, and for these entities the Transactional leadership style is still the model of choice.

Transactional Leadership

Transformational Leadership

• Builds on man’s need to get a job done and make a living

• Is preoccupied with power and position, politics and perks

• Is mired in daily affairs

• Is short-term and hard data orientated

• Focuses on tactical issues

• Relies on human relations to lubricate human interactions

• Follows and fulfils role expectations by striving to work effectively within current systems

• Supports structures and systems that reinforce the bottom line, maximise efficiency, and guarantee short-term profits

• Builds on a man’s need for meaning

• Is preoccupied with purposes and values, morals, and ethics

• Transcends daily affairs

• Is orientated toward long-term goals without compromising human values and principles

• Focuses more on missions and strategies

• Releases human potential – identifying and developing new talent

• Designs and redesigns jobs to make them meaningful and challenging

• Aligns internal structures and systems to reinforce overarching values and goals

Figure Comparison of Transactional and Transformational Leadership (Covey, 1992)

(Bolden, Gosling, Marturano, & Dennison, 2003)

Transformational Leadership

What is transformational leadership? During the discussion about transactional leadership, the reader could sense what transformational leadership might entail. One main difference between transactional and transformational leadership is in the way the leaders motivated their followers. The transactional leader motivates followers to deliver more than what was expected, the behaviour of transformational leaders is guided by the leader’s personal values and beliefs. Obiwuru et al quoted Burns (1978), Burns identified transformational leadership as a process where, “one or more persons engage with others in such a way that leaders and followers raise one another to higher levels of motivation and morality”.

Followers of transformational leaders trusts, admires respect and have loyalty to their leaders. The transformational leader makes the followers aware of the importance of the different tasks at hand. Due to the motivation from the leader, the followers are willing to sacrifice their own interest in order to achieve the goals of the company. The leaders inspires followers to view problems from different angles, to search for new ways to do their jobs, this inclusion of the followers result in intellectual stimulation as well as an increase in performance as argued by Podsakoff et al, 1996. (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, p. 103)

Transformational leadership were described as “…moving the leader beyond immediate self-interest…” (Bass, Two Decades of Research and Development in Transformational Leadership, 1999, p. 11) divided in four different components or behaviours by Bass in 1990. These components are charisma – also later referred to as idealized influence – inspirational motivation, intellectual stimulation and individual consideration” (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, p. 109) (Bass, Two Decades of Research and Development in Transformational Leadership, 1999, p. 11)

Charisma or “Idealised Influence” according to (Humphreys & Einstein, 2003) has various characters that include vision, mission, a sense of installing pride within the group as well as creating respect and trust. Individual followers are encouraged by this charismatic behaviour to move beyond their self-interest and to start focusing on what is good for the group (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, p. 109) Idealized Influence is when a leader can visualise a desired outcome explain how this outcome can be reached and set an example for his / her followers. This type of leader display confidence and follow their goals with determination and set high performance standard for themselves as well as for their followers.

“Inspirational motivation” usually goes hand-in-hand with charisma and focus on leaders setting high standards and in doing so become a reference or goal for others to achieve the same. The behaviour of this leader is that they are always optimistic when talking about the future and explain this vision clearly to their followers. They encourage their followers to visualise a positive outcome in the future, both for themselves as well as for the organization.

The third dimension of transformational leadership is “intellectual” stimulation followers are confronted with new ideas and followers are required to break away from doing things the old way and to search for new solutions to problems. The leader will promote intelligence a discarding the old way of thinking and coming up with a new different way of thinking. The focus will be on logical thinking and will encourage followers to focus on careful problem solving. The leader will encourage and assist followers to think about new ways to do old things, thinking out of the box, analyse situations but taking a new point of view on the approach to solving these problems, followers are guided on how to be more creative and how to think more innovative. (Bass 1985), (Bass, Two Decades of Research and Development in Transformational Leadership, 1999, p. 11)

The fourth and last dimension of transformational leadership is “individual consideration” this dimension focus on the mentoring and coaching followers (Bass, 1985; Bass & Avolio, 1990) the leader will pay close attention to the individuals and will become a mentor to them, assisting with developing their strengths, helping them to achieve a higher level of maturity and …”to enhance effective ways of addressing their goals and challenges” (Bass, 1985) (Obiwuru, Okwu., Akpa, & Nwankwere, 2011, p. 103)

Laissez-Faire Leadership Style – Still need to re-type and get more info

Leaders, who have behaviours of avoid responsibilities, lake of direction and decisions, loss of influence, fail to communication, and lack of any kind of leadership (Bass, 1985; Geyer & Steyrer, 1998; Avolio et al., 1999; Antonakis et al, 2003; Avolio & Bass, 2004; Sarver, 2008). (Sahaya, 2012)

“Laissez-faire leadership, the avoidance of leadership, such as “is absent when needed”, and “takes no action even when problems become chronic” was strongly associated with subordinate dissatisfaction, conflict, and ineffectiveness. But, early on, it included some items which assessed the more positive empowerment, such as “lets me decide on matters about which I know best”. Empowerment by the leader implied giving follower’s autonomy but giving it with reason and interest in what was delegated. laissez-faire leadership is almost uniformly negatively correlated with outcomes. There has been some demonstration of the contributions of transformational leadership to other criteria such as innovativeness and quality improvement. None the less, there has been relatively little basic research testing of the many models of linkages proposed by Bass (1985) to explain how transformational leadership works. (Bass, Two Decades of Research and Development in Transformational Leadership, 1999, pp. 22-23)

“Laissez-faire leadership is the avoidance or absence of leadership and is the most inactive as well as most ineffective among all other styles of leadership (Bass, 1998). This type of leader displays an absence of behaviour, where decisions are not made, actions are delayed, and authority is not utilised.”

Passive-Avoidant Leadership Style

Passive-avoidant leadership styles were comprised of two factors (Bass & Avolio, 2004). The details are following:

Management-By-Exception (Passive)

Leaders, who have behaviors of waiting until a problem become serious, wait for things to go wrong before taking action (Avolio & Bass, 2004). These behaviours were no leadership. (Sahaya, 2012, p. 98)

Chapter 3: Methodology

MLQ

“The Multifactor Leadership Questionnaire (MLQ) (Bass & Avolio, 1995) was used to measure the leadership styles. MLQ is a multidimensional scale consisting of 37 items and measures a broad range of leadership styles such as transformational, transactional, and laissez-faire leadership. The transformational leadership style consisted of 21 items. Some of the items included in transformational leadership style were, for example, “talks optimistically about the future” and “spends time in teaching and coaching”. The respondents were asked to rate their general opinion about their immediate boss on a five-point scale ranging from “to a very great extent (5)” to “not at all (1)”. The Cronbach’s alpha of this scale was .96. Transactional leadership style consisted of 12 items. Some of the items in this scale included, “expresses his/her satisfaction when I do a good job”, and “keeps track of my mistakes”. The Cronbach’s alpha of this scale was .72. The laissez-faire leadership style consisted of four items. Items in the scale included, for example, “avoids making decisions”. The Cronbach’s alpha of this revised scale was .93. The categorisation of age of the employees into groups was based on career-stage theory as described by Gruneberg (1976), and Kacmar and Ferris (1989). According to this theory, the older the employee, the higher is the satisfaction towards the job. If a person is satisfied, then there is a possibility that his leadership style will be more impressive. The categorisation of job experience of employees into groups was based on Maslow’s hierarchy of needs theory (1943). It said that there are five levels of need in a person’s career, namely, physiological, security, belongingness, esteem, and self-actualisation needs. With increasing age, the needs of a person might vary. All these needs contribute to the development of leadership qualities. Thus, based on the present data the following job experience and career stages groups were formed for further analyses.” (Giri & Santra, 2009, p. 88)

Definitions:

Transformational leadership: leader behaviors that transform and inspire followers to perform beyond expectations while transcending self-interest for the good of the organization

References

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