The Relationship between Leadership Behaviour and Firm Performance in the Ready-Made Garments Industries of Bangladesh

This research examined the relationship between leaders' behaviour, emotional intelligence, competitive advantage, firm strategy and performance. The three-factor model of leadership behaviour linking competitive advantage and firm performance is a unique model tested in this research. This study is also one of the first attempts which survey 400 leaders from Bangladeshi companies to test this model in a developing country. Quantitative analyses revealed that relation-oriented behaviour significantly relates to firm performance through competitive advantage. The task and change-oriented leadership behaviours revealed a weaker version of the same association trend. The research also showed that emotional intelligence moderated the relationship between leader behaviours and competitive advantage, and firm strategy moderated the relationship between competitive advantage and firm performance. Results favoured a three-factor model that included change-oriented behaviour as the extension of the classic two-factor leadership behaviour model. This information will benefit organisations in several ways. Theoretically, it will fill the gap existing in the leadership literature. Practically, it will provide current leaders with the understanding required to enhance their leadership behaviour and use it to increase firm performance. Most importantly, firms may use these findings to design professional leadership training, improve employees' emotional intelligence, prepare future leaders, and sustain competitive advantage.