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Dimensions of transformational leadership and organizational performance: the mediating effect of job satisfaction

Author

Listed:
  • Sam Kris Hilton
  • Wonder Madilo
  • Fred Awaah
  • Helen Arkorful

Abstract

Purpose - Poor corporate governance was reported to significantly contribute to the 2017/2018 financial crisis in Ghana. As leadership is a vital concept in the corporate governance system, this study aims to examine the effect of transformational leadership on organizational performance and hypothesizes that job satisfaction mediates such a relationship. Design/methodology/approach - This study adopted a quantitative research approach where a cross-sectional survey design was used to collect the data from 300 purposively sampled employees of five selected commercial banks. The data was analysed using PROCESS version 3.4.1. Findings - The results show that individualized consideration is the dominant transformational leadership dimension being practiced by supervisors and managers in the selected commercial banks. Again, the four dimensions of transformational leadership have a positive effect on organizational performance, and such effect is significantly mediated by job satisfaction. Practical implications - The findings suggest that the dimensions of transformational leadership should be continuously improved alongside strategically motivating employees to increase their satisfaction level to enhance organizational performance. Originality/value - This study provides evidence that bank managers need to be cognizant that job satisfaction is vital in the industry and must be a focal point of corporate governance practices. The mere initiating of transformational leadership behaviours without a clear link to employee satisfaction may result in employee disengagement, consequently affecting the banks’ performance and survival.

Suggested Citation

  • Sam Kris Hilton & Wonder Madilo & Fred Awaah & Helen Arkorful, 2021. "Dimensions of transformational leadership and organizational performance: the mediating effect of job satisfaction," Management Research Review, Emerald Group Publishing Limited, vol. 46(1), pages 1-19, December.
    • Handle: RePEc:eme:mrrpps:mrr-02-2021-0152
    DOI: 10.1108/MRR-02-2021-0152
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    Cited by:

    1. Nor Sabrena Norizan & Ahmad Fadhly Arham & Ahmad Firdhaus Arham & Fatanah Jislan & Siti Norashikin Bashirun, 2024. "Perceived Organisational Support, Transformational Leadership and Organizational Performance: Perspectives of Hospitality Industry in Malaysia," Information Management and Business Review, AMH International, vol. 16(1), pages 157-172.
    2. Dr. Nasir Javed Awan, 2024. "Enhancing Organizational Performance: Investigating the Intersection of Employees’ Job Outcomes and Workplace Environment," Bulletin of Business and Economics (BBE), Research Foundation for Humanity (RFH), vol. 13(2), pages 310-328.

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