Managers Leadership and Bank Institutions in the US - Research Paper Example

Banker’s perception of their Managers leadership styles and the effect on the performance of the banking s in the US Table Contents Introduction 4 Literature review 4 Purpose 4 Organization’s leadership styles within situational leadership theory 5 Situational leadership style 6 Transformational leadership style 7 Transactional leadership style 7 Presentation of your Material (Analysis of your topic) 8 Problem and the Aim of the Study 8 Research questions 8 Design of the study 9 Design of the Instrument 9 Research Variables 9 Data collection procedures 10 Analysis of the Data 10 Summary and Conclusions 10 References 12 Abstract The manner in which staff members in the banking institution perceive their managers’ leadership style influences their individual performance and that of the entire banking institution. The study examines the extent of this influence. This quantitative study examined banker’s perception of the leadership styles of their managers as transformational, transactional or passive-avoidant in improving and non-improving .The population for this study was a sample size of 100 bank staff in 10 banks in US. The study made use of Multifactor Leadership Questionnaire to measure leadership behaviors, as the bankers perceive them. To analyze the research questions, the study used open-ended question and multiple regression. The study found out that bankers had minimal differences in how they perceived their managers leadership styles. The three leadership styles were all significant predictors of organizations performance. Transactional leadership had an adverse relationship while the transformational and passive avoidant styles had a positive correlation with the organization performance. Banker’s perception of their Managers leadership styles and the effect on the performance of the banking institutions in the US Introduction Management and leadership are essential functions in any profession. Motivating leadership together with reliable management is vital in every level of an organization to ensure employee learning, alignment and career development. Management and leadership go hand in hand. For instance if an organization has strong management and lacks good leadership, bureaucracy knocks in. On the contrary, the presence of strong leadership in the organization without proper management results in unnecessary and senseless change within the organization. Leaders can be managers though managers may not be leaders. Leaders usually have character traits that lend their skills more to directing a company rather than managing resources. Having lived the experience of being a manager and a leader, the principal interest is to understand the concepts of leadership and management and specifically the notion of philosophy and the styles of leadership. Literature review Since the early 20th century, hundreds of researchers have been conducting studies on the traits of leaders. The studies have produced a long list of essential leadership traits such as trustworthiness, dependability, sociability, open-mindedness, confidence articulateness, diligence, self-assurance, conscientiousness among others. All these qualities relate to effective leadership (Northouse, 2012). Purpose The aim of this division is to review the literature exploring the effects of leadership styles on the organization’s capacity. Organizational capacity is a concept that has received considerable attention from the public and nonprofit management literature over recent several years. Capacity entails an organization ability of realizing its goals. Capacity has been of absolute attention to scholars interested in understanding the variables that influence the organizational performance (Christensen and Gazley, 2008). The conceptual framework reflects on situational leadership theory transformational and transactional leadership styles. For the purpose of this paper, employee focused leadership refers to the decisions and actions of organization-based managers who in directing their organization and decisions, affect the employee capacity on the organization’s performance. The style of leadership influences the organizations ability. An effective organizational leader selects the leadership style that positively affects company’s ability to increase its performance. The literature review contains the analysis of the relationship between leadership style and organizations function. The review of the literature discusses the relationship between transactional and transformational leadership styles and the organizations reaction to the style. Organization’s leadership styles within situational leadership theory The administration role is essential to improving the organization performance through leadership style and organizations capacity. Situational theories of leadership encourage interactions among leaders, subordinates, and forces within the organization. Effective situational leadership diagnoses the forces in a particular organization and a leadership style that fits the specific situation. The challenge of situational leadership is that in practice, leaders who know the forces in operation in a specific position must also have the ability to modify their leadership style to cope with the changes in the work environment Situational leadership style The section reviews the synthesis of the leadership styles defined as the situational theory to explain the flexibility of the superior’s choices. The use of combined leadership styles creates a tool for the leader. Blasé and Blasé, (1999) noted that situational leadership theory provides the superiors with transactional and transformational tools to ensure the best interest of the organization that focuses on employees effectiveness. According to Bertocci, (2009), the four situational models of leadership are similar because they look at the dynamics of leadership rather than the traits or behavior. Fiedler’s contingency theory reflects that leaders are relationship or task oriented, and they work best in situations engineered to fit that style. Fiedler further competes that followers opt different leadership styles depending on the structure of the task, the relationship between the leader and the position power of the head of the organization. The interaction of the situation and the different personality factors determines the effectiveness of the leader. The Path-Goal Model of leadership shows that leaders can increase their effectiveness by using task reward techniques. The model also shows that each follower has different motivational needs that the leader must consider using the model correctly. The path-goal model indicate that effective leaders communicate directly and clearly, the behavior that suits the organization best and determines the actions that need completion to receive the awards. The Hersey- Blanchard theory reflects that leaders must adjust their style of leadership to fit a particular task and relationship with the followers. The ability of the follower to take responsibility affects the leadership style of the leader by putting into consideration the skills and the maturity of the every follower. Effective leaders can adapt coaching, directing, supporting and delegating styles of leadership to fit a follower’s level of maturity experience and skills (Blanchard & Hersey, 1979). The Vertical-Dyad Linkage or Leader-Member Exchange Theory just like the Hersey-Blanchard Theory indicates that leaders must learn to adapt and ensure that they are not consistent with all the followers. The theory classifies followers as either in-group or out-group. In-group members have a common bond and values with the leader. On the other hand, out-group followers do not have many similarities with the manager. The most effective leader can adapt the leadership style to fit a followers needs and the situation of a group. Transformational leadership style This section of the literature review surveyed transformational leadership relating to organization’s capacity. The transformational leadership style offers results that define the management culture. A report by Burns, (1978) showed that there existed no central leadership concept even with all the abundant relevant literature. The generalizations are only possible by studying the human psychology. In transformation leadership, the leader educates and motivates the followers towards own decision making without supervision. This style of leadership gives the employees a higher level of self-efficacy. A study conducted by Abdussamad, Akib, Jasruddin, and Paramata, (2015) on the effect of transformational leadership on employee performance shows that employee performance can be achieved optimally in transformational leadership, work motivation and organizational culture that favors the employee on their working environments. Transactional leadership style Transactional leadership style occurs when a leader communicates the particular standards of conformity as he monitors those who defy and rewarding those that comply. A review of literature relating to transactional leadership shows frequent comparisons to transformational leadership. Transactional leadership style encourages followers to identify what they need to accomplish and offers them the authority to complete the tasks therefore promoting their self-efficacy. Presentation of your Material (Analysis of your topic) This section introduces the methodology used to investigate the potential relationship between organization leadership style, employee demographics, and the organization performance. The study used data collected in surveys. The unit is divided into the following themes which are statement of the problem/ purpose of the study, research questions, design of the study, design of the instrument, research variables, data collection procedures and data analysis. Problem and the Aim of the Study Organization leaders use various styles of leadership when making decisions that may affect the success of their employees who in turn influences the performance of the entire organization. Researchers recommend further studies to investigate the determinants of employee performance outside the work motivation, organizational culture and transformational leadership. The core objective of this paper was to find out the relationship between employee’s perception of their superior’s leadership styles and the organization performance. Research questions 1. How do the employees perceive the leadership styles of their superiors in high performing and low performing organizations? 2. What is the relationship between transactional, transformational and passive -avoidant leadership styles of the superiors as perceived by their followers? 3. What are the behaviors of superiors that influence organization performance as perceived by the employees? 4. How do the employees perceive the leadership styles of their superiors as leadership outcomes of effectiveness, satisfaction, and extra effort? Design of the study This study is an exploratory, non-experimental, correlational study that examines the relationship between the managers’ leadership style and the bankers’ performance in specific banks in the US. The classification of the study is non-experimental due to the inability of the researcher to control any factors influencing the respondents. The design of this paper utilized a quantitative survey instrument to collect data from the subordinates to identify their perception of the leadership styles of their superiors. The study used a correlational research design to determine the relationship of the bankers’ perception of the manager’s leadership style and organization performance of banks in the US. Design of the Instrument The instrument in this study intended to measure the bankers’ perception of their manager’s leadership style and provide the banker’s demographic data. The examination of the leadership styles was within the defined leadership behaviors of the multifactor leadership questionnaire and characterized as transactional, transformational and passive avoidant. The questionnaire had one open-ended question was included in the survey to provide a chance for the bankers to include additional information, not in the questionnaire. The study used the multifactor leadership questionnaire to measure the leadership styles since it is a broadly acceptable and a reliable instrument used by researchers. The instrument measures the leader’s use of transformational, passive avoidant and transactional forms. Research Variables Dependent variables measure any change that occurs because of the independent variable. On the other hand independent variable measure what the researcher manipulates through experimental methods to discover the relationship with the dependent variable. The study used leadership styles, which are transformational, transactional, or passive-avoidant as the dependent variable.The independent variable performance level of the banks, which is defined as either improving or non-improving. Data collection procedures The survey made use of data from secondary sources from the sampled firms annual accounts and report. The study will also use other secondary sources, such as journals, books, web pages, and statistics. In addition, a questionnaire distributed to the sample population will help to gather the perceptions of the bankers on their managers’ style of leadership and level of customer satisfaction. To collect data, the survey used multilevel questionnaire MLQ and a demographic survey that addresses the respondent’s gender, age, years of the banking experience and years in the current banking institution. Analysis of the Data The research made use of descriptive statistics to scrutinize the numeric data to comprehend and explain the results. To study the relationship between leadership and customer satisfaction, the researcher used inferential statistics. The study made use of regression analysis to determine if there exists a connection between the leadership styles and the level of customer satisfaction. Summary and Conclusions The study explored how bankers’ perception of their superior’s leadership style affected the performance of the institution in terms customer satisfaction. Raising the level of customer satisfaction is the ultimate goal of the leaders in the bank. Superiors have the potential to influence the degree of client satisfaction through the leadership decision the impact of such decisions on the subordinates and ultimately the customers. Situational leadership theory provided a framework for this research by examining the bankers’ perception of the superiors’ leadership style and its influence on the bank’s capacity and level of customer satisfaction. Leaders in the banking institution have the ability to choose leadership styles that that influences the practices of their subordinates either positively or negatively. The study noted that banker’s perception of superiors demonstrating transformational leadership qualities identified in the MLQ was only by a small margin. The study recommends the need for the training of the superiors to build their repertoire of leadership styles successful and to ensure that the institutions capacity supports effective employee practices and increases customer satisfaction References Abdussamad, J., Akib, H., Jasruddin, & Paramata, J. (2015). Effect Of transformational leadership and organizational culture on employee performance toward the department of education, youth and sports Gorontalo province, Indonesia. International Journal Of Academic Research, 7(1), 386-390. Doi:10.7813/2075-4124.2015/7-1/B.65 Bertocci, D. I. (2009). Leadership in organizations: There is a difference between leaders and managers. Lanham, Md: University Press of America. Christensen, R. K., & Gazley, B. (2008). Capacity for public administration: Analysis of meaning and measurement. Public Administration and Development, 28(4), 265-279. Northouse, P. G. (2012). Introduction to Leadership: Concepts and Practice. Thousand Oaks, Calif: SAGE Publications. Read More