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Leadership Style And Organizational Performance: A Comparative Study Between Transformational And Transactional Leadership Styles

Author

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  • Hammad Tahir

    (Institute of Business & Technology)

Abstract

Purpose This study has been conducted with objective to investigate the various leadership characteristics of Transformational and Transactional Leadership and then to empirically analyze the effect of each type of leadership on the organizational performance.Methodology/Sampling This study considers a sample of 800 respondents has been interviewed to collect the required information.The sample includes employees at tactical and operational management in corporate sector.Factor analysis which has been applied to determine the key characteristics of each type of leadership, thereafter the OLS estimation has been applied to test the hypotheses of the study.Findings The study concludes that the Charismatic Action, Intellectual Stimulation, Inspiration Motivation, Encouragement for High Morale characteristics of Transformational Leadership has significant positive effect on the Organizational Performance.In regard of the Transformational Leadership the further concludes that the Individual Consideration act of Transformational Leadership does not has significant effect on the Organizational Performance.A final conclusion based on the empirical analysis is that Transformational Leadership has significant positive effect on Organizational Performance, whereas, the Transactional Leadership has significant negative effect on the organizational Leadership.Practical Implications This study provides empirical evidences that the Transformational Leadership is the most effective leadership in organizational performance.The key success factors or characteristics for a transformational leadership are Charismatic Action, Intellectual Stimulation, Inspiration Motivation, and Encouragement for High Morale characteristics of Transformational Leadership.

Suggested Citation

  • Hammad Tahir, 2015. "Leadership Style And Organizational Performance: A Comparative Study Between Transformational And Transactional Leadership Styles," IBT Journal of Business Studies (JBS), Ilma University, Faculty of Management Science, vol. 11(2), pages 257-274.
    • Handle: RePEc:aib:ibtjbs:v:11:y:2015:i:2:p:257-274
    DOI: https://doi.org/10.46745/ilma.ibtjbs.2015.112.19
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    Citations

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    Cited by:

    1. Aborampah Amoah-Mensah & Patrick Darkwa, 2018. "Leadership Styles Of Owner-Managers And Employees’ Performance: The Moderating Role Of Age And Experience," Romanian Economic Business Review, Romanian-American University, vol. 13(3), pages 34-60, September.
    2. repec:rau:journl:v:13:y:2018:i:3:p:47-73 is not listed on IDEAS
    3. Ying-Leh Ling & Sun-Sun Ho, 2022. "Transformational Leadership and Subordinate’s Work Performance in Penang Private Higher Learning Institutions," International Journal of Research and Innovation in Social Science, International Journal of Research and Innovation in Social Science (IJRISS), vol. 9(12), pages 78-84, December.

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