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

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