Vol. 1 No. 19 (2021): Journal of Leadership and Management
Articles
The Correlational Study of the Transformational Leadership Style Financial Managers of Small Business and Influence on the Job Performance Employees in the United States
Published
March 20, 2022
Keywords
- small business,
- transformational leadership,
- job satisfaction
How to Cite
Abdulrahman, A., & Kasztelnik, K. (2022). The Correlational Study of the Transformational Leadership Style Financial Managers of Small Business and Influence on the Job Performance Employees in the United States. Journal of Leadership and Management, 1(19). Retrieved from http://www.leadership.net.pl/JLM/article/view/213
Copyright (c) 2022 Author & JLM
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
Abstract
Research has shown that the leadership of a business can significantly impact employee performance, with dissatisfied employees performing at a lower level, potentially causing disruption and costs to the business. Several studies have documented the importance that small businesses have on the economy, and small businesses constitute over half of all jobs. This study investigated the relationship between transformational leadership style and employee satisfaction in small businesses in Virginia. The theoretical framework for this research is self-determination theory (SDT), which is vital for placing focus on certain human needs, particularly in the workplace, and transformational leadership. These things play key roles in focusing on the style used by managers and leaders when interacting with employees. More specifically, this research determined what characteristics of transformational leadership are demonstrated by managers of Virginia small businesses in dealing with employees, as measured by a transformational leadership scale, and what the employee satisfaction level is in the small businesses where managers demonstrate transformational skills, as measured by the Minnesota Satisfaction Questionnaire (MSQ). The research is important because the findings can help improve both personal lives and the health of small businesses and the economy. Readers would care because the findings could easily impact their workplace or the workplace of someone they know. A correlation coefficient was used to determine if a relationship existed. The research tries to make the workplace a more humane and efficient place while improving teamwork and workplace dynamics stemming from leadership. The findings show that there is a correlation between a more positive environment and employee performance. The sample size of 84 participants was obtained from a directory of small businesses in Virginia. Results of this study were discussed in terms of their implications for understanding how using a transformational leadership style affects employee satisfaction and performance and how these findings might relate to improving small business management and outcomes.
References
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Cohen-Schotanus, J., and Van der Vleuten, C. P. M. (2010). “A Standard Setting Method With the Best Performing Students As Point of Reference: Practical and Affordable.” Medical Teacher, 32(2), pp. 154–160: https://doi.org/10.3109/01421590903196979.
Conover, W. J., and Iman, R. L. (1981). “Rank Transformations As a Bridge Between Parametric and Nonparametric Statistics.” The American Statistician, 35(3), pp. 124–129: https://doi.org/10.1080/00031305.1981.10479327.
Deci, E. L. (1971). “Effects of Externally Mediated Rewards on Intrinsic Motivation.” Journal of Personality and Social Psychology, 18(1), pp. 105–115: https://doi.org/10.1037/h0030644.
Deci, E. L., Olafsen, A. H., and Ryan, R. (2017). “Self-Determination Theory in Work Organizations: The State of a Science.” The Annual Review of Organizational Psychology and Organizational Behavior, 4, pp. 19–43: https://doi.org/10.1146/annurev-orgpsych-032516-113108.
Delanoy, N., and Kasztelnik, K. (2020). “Business Open Data Analytics to Support Innovation Leadership and Management Decision in Canada.” Business Ethics and Leadership, 4(2), pp. 56–74: https://doi.org/10.21272/bel.4(2).56-74.2020.
Dilger, R. J. (2019). Small Business Administration and Job Creation. Congressional Research Service.
Goodwin, V. L., Whittington, J. L., Murray, B., and Nichols, T. (2011). “Moderator or Mediator? Examining the Role of Trust in the Transformational Leadership Paradigm.” Journal of Managerial Issues, 23(4), pp. 409–425.
Han, S. H., Seo, G., Yoon, S. W., and Yoon, D. (2016). “Transformational Leadership and Knowledge Sharing.” Journal of Workplace Learning, 28(3), pp. 130–149: https://doi.org/10.1108/jwl-09-2015-0066.
Ismail, A., Mohamad, M. H., Mohamed, H. A., Rafiuddin, N. M., and Zhen., K. W. P. (2010). “Transformational and Transactional Leadership Styles as a Predictor of Individual Outcomes.” Theoretical and Applied Economics, Volume XVII, 6(547), pp. 89–104.
Jager, J., Putnick, D. L., and Bornstein, M. H. (2017). “More than Just Convenient: The Scientific Merits of Homogeneous Convenience Samples.” Monographs of the Society for Research in Child Development, 82(2), pp. 13–30: https://doi.org/10.1111/mono.12296.
Jyoti, J., and Dev, M. (2015). “The Impact of Transformational Leadership on Employee Creativity: The Role of Learning Orientation.” Journal of Asia Business Studies, 9(1), pp. 78–98: https://doi.org/10.1108/jabs-03-2014-0022.
Kanat-Maymon, Y., Elimelech, M., and Roth, G. (2020). “Work Motivations as Antecedents and Outcomes of Leadership: Integrating Self-Determination Theory and the Full Range Leadership Theory.” European Management Journal: https://doi.org/10.1016/j.emj.2020.01.003.
Kasztelnik, K. (2020). “Innovative Empirical Model for Predicting National Bank’s Financial Failure with Artificial Intelligence Subset Data Analysis in the United States.” Open Economics, 3, pp. 98–111: https://doi.org/10.1515/openec-2020-0106.
Kawiana, I. G. P., Dewi, L. K. C., Martini, L. K. B., and Suardana, I. B. R. (2018). “The Influence of Organizational Culture, Employee Satisfaction, Personality, and Organizational Commitment Towards Employee Performance.” International Research Journal of Management, IT and Social Sciences, 5(3), pp. 35–45.
Kouni, Z., Koutsoukos, M., and Panta, D. (2018). “Transformational Leadership and Job Satisfaction: The Case of Secondary Education Teachers in Greece.” Journal of Education and Training Studies, 6(10), p. 158: https://doi.org/10.11114/jets.v6i10.3451.
Lan, X. M., and Chong, W. Y. (2015). “The Mediating Role of Psychological Empowerment Between Transformational Leadership and Employee Work Attitudes.” Procedia – Social and Behavioral Sciences, 172, pp. 184–191: https://doi.org/10.1016/j.sbspro.2015.01.353.
Ling, Q., Lin, M., and Wu, X. (2016). “The Trickle-Down Effect of Servant Leadership on Frontline Employee Service Behaviors and Performance: A Multilevel Study of Chinese Hotels.” Tourism Management, 52, pp. 341–368: https://doi.org/10.1016/j.tourman.2015.07.008. Locke, E. A. (1968). “Toward a Theory of Task Motivation and Incentives.” Organizational Behavior and Human Performance, 3(2), pp. 157–189: https://doi.org/10.1016/0030-5073(68)90004-4.
Luturlean, B. S., Prasetio, A. P., and Saragih, R. (2019). “Increasing Employee’s Job Satisfaction Through the Implementation of Transformational Leadership and Work Stress Level Management.” Journal of Management and Marketing Review, 4(3), pp. 209–217: https://doi.org/10.35609/jmmr.2019.4.3(6).
Malik, W. U., Javed, M., and Hassan, S. T. (2017). “Influence of Transformational Leadership Components on Job Satisfaction and Organizational Commitment.” Pakistan Journal of Commerce and Social Sciences, 11(1), pp. 147–166.
Martinaityte, I., Sacramento, C., and Aryee, S. (2019). “Delighting the Customer: Creativity-Oriented High-Performance Work Systems, Frontline Employee Creative Performance, and Customer Satisfaction.” Journal of Management, 45(2), pp. 728–751: https://doi.org/10.1177/0149206316672532.
Maslow, A. H. (1943). “A Theory of Human Motivation.” Psychological Review, 50(4), pp. 728–751: https://doi.org/10.1037/h0054346.
Ng, H. S., Kee, D. M. H., and Ramayah, T. (2016). “The Role of Transformational Leadership, Entrepreneurial Competence and Technical Competence on Enterprise Success of Owner-Managed SMEs.” Journal of General Management, 42(1), pp. 23–43: https://doi.org/10.1177/030630701604200103.
Para-González, L., Jiménez-Jiménez, D., and Martínez-Lorente, A. R. (2018). “Exploring the Mediating Effects Between Transformational Leadership and Organizational Performance.” Employee Relations, 40(2), pp. 412–432: https://doi.org/10.1108/ER-10-2016-0190.
Purohit, H., Yadav, A., and Goyal, S. (2016). “Validation of Minnesota Satisfaction Questionnaire: A Study of Front-Line Retail Employees.” SSRN: https://doi.org/10.2139/ssrn.2864211.
Rudd, H., Kent, T., Blair, C. A., and Schuele, U. (2009). “Leader Behavior Inventory: A Test of Measure Equivalence in Germany and the United States.” International Journal of Leadership Studies, 5(1), pp. 22–36.
Ryan, R. M., and Deci, E. L. (2000). “Self-Determination Theory and the Facilitation of Intrinsic Motivation, Social Development, and Well-Being.” American Psychologist, 55(1), pp. 68–78: https://doi.org/10.1037/0003-0066X.55.1.68.
Saleem, H. (2015). “The Impact of Leadership Styles on Job Satisfaction and Mediating Role of Perceived Organizational Politics.” Procedia – Social and Behavioral Sciences, 172(27), pp. 563–569: https://doi.org/10.1016/j.sbspro.2015.01.403.
Top, M., Akdere, M., & Tarcan, M. (2014). “Examining Transformational Leadership, Job Satisfaction, Organizational Commitment and Organizational Trust in Turkish Hospitals: Public Servants Versus Private Sector Employees.” The International Journal of Human Resource Management, 26(9), pp. 1259–1282: https://doi.org/10.1080/09585192.2014.939987.
Umadia, K., and Kasztelnik, K. (2020). “The Financial Innovative Business Strategies of Small to Medium Scale Enterprises in Developing Country and Influence for the Global Economy Performance.” SocioEconomic Challenges, 4(3), pp. 20–32: https://doi.org/10.21272/sec.4(3).20–32.2020.
Valdiserri, G. A., and Wilson, J. L. (2010). “The Study of Leadership in Small Business Organizations: Impact on Profitability and Organizational Success.” The Entrepreneurial Executive, 15, p. 47.
Wang, Y., and Poutziouris, P. (2010). “Leadership Styles, Management Systems, and Growth: Empirical Evidence From UK Owner-Managed Smes.” Journal of Enterprising Culture, 18(3), pp. 331–354: https://doi.org/10.1142/S0218495810000604.
Weiss, D. J., Dawis, R. V., England, G. W., and Lofquist, L. H. (1967). “Manual for the Minnesota Satisfaction Questionnaire.” Minnesota Studies in Vocational Rehabilitation, XXII: https://vpr.psych.umn.edu/sites/vpr.umn.edu/files/files/monograph_xxii_-_manual_for_the_mn_satisfaction_questionnaire.pdf.
Yalabik, Z. Y., Rayton, B. A., and Rapti, A. (2017). “Facets of Job Satisfaction and Work Engagement.” Evidence-Based HRM: A Global Forum for Empirical Scholarship, 5(3), pp. 248–265.
Choi, S. L., Goh, C. F., Adam, M. B. H., and Tan, O. K. (2016). “Transformational Leadership, Empowerment, and Job Satisfaction: The Mediating Role of Employee Empowerment.” Human Resources for Health, 14(1), p. 73: https://doi.org/10.1186/s12960-016-0171-2.
Cohen-Schotanus, J., and Van der Vleuten, C. P. M. (2010). “A Standard Setting Method With the Best Performing Students As Point of Reference: Practical and Affordable.” Medical Teacher, 32(2), pp. 154–160: https://doi.org/10.3109/01421590903196979.
Conover, W. J., and Iman, R. L. (1981). “Rank Transformations As a Bridge Between Parametric and Nonparametric Statistics.” The American Statistician, 35(3), pp. 124–129: https://doi.org/10.1080/00031305.1981.10479327.
Deci, E. L. (1971). “Effects of Externally Mediated Rewards on Intrinsic Motivation.” Journal of Personality and Social Psychology, 18(1), pp. 105–115: https://doi.org/10.1037/h0030644.
Deci, E. L., Olafsen, A. H., and Ryan, R. (2017). “Self-Determination Theory in Work Organizations: The State of a Science.” The Annual Review of Organizational Psychology and Organizational Behavior, 4, pp. 19–43: https://doi.org/10.1146/annurev-orgpsych-032516-113108.
Delanoy, N., and Kasztelnik, K. (2020). “Business Open Data Analytics to Support Innovation Leadership and Management Decision in Canada.” Business Ethics and Leadership, 4(2), pp. 56–74: https://doi.org/10.21272/bel.4(2).56-74.2020.
Dilger, R. J. (2019). Small Business Administration and Job Creation. Congressional Research Service.
Goodwin, V. L., Whittington, J. L., Murray, B., and Nichols, T. (2011). “Moderator or Mediator? Examining the Role of Trust in the Transformational Leadership Paradigm.” Journal of Managerial Issues, 23(4), pp. 409–425.
Han, S. H., Seo, G., Yoon, S. W., and Yoon, D. (2016). “Transformational Leadership and Knowledge Sharing.” Journal of Workplace Learning, 28(3), pp. 130–149: https://doi.org/10.1108/jwl-09-2015-0066.
Ismail, A., Mohamad, M. H., Mohamed, H. A., Rafiuddin, N. M., and Zhen., K. W. P. (2010). “Transformational and Transactional Leadership Styles as a Predictor of Individual Outcomes.” Theoretical and Applied Economics, Volume XVII, 6(547), pp. 89–104.
Jager, J., Putnick, D. L., and Bornstein, M. H. (2017). “More than Just Convenient: The Scientific Merits of Homogeneous Convenience Samples.” Monographs of the Society for Research in Child Development, 82(2), pp. 13–30: https://doi.org/10.1111/mono.12296.
Jyoti, J., and Dev, M. (2015). “The Impact of Transformational Leadership on Employee Creativity: The Role of Learning Orientation.” Journal of Asia Business Studies, 9(1), pp. 78–98: https://doi.org/10.1108/jabs-03-2014-0022.
Kanat-Maymon, Y., Elimelech, M., and Roth, G. (2020). “Work Motivations as Antecedents and Outcomes of Leadership: Integrating Self-Determination Theory and the Full Range Leadership Theory.” European Management Journal: https://doi.org/10.1016/j.emj.2020.01.003.
Kasztelnik, K. (2020). “Innovative Empirical Model for Predicting National Bank’s Financial Failure with Artificial Intelligence Subset Data Analysis in the United States.” Open Economics, 3, pp. 98–111: https://doi.org/10.1515/openec-2020-0106.
Kawiana, I. G. P., Dewi, L. K. C., Martini, L. K. B., and Suardana, I. B. R. (2018). “The Influence of Organizational Culture, Employee Satisfaction, Personality, and Organizational Commitment Towards Employee Performance.” International Research Journal of Management, IT and Social Sciences, 5(3), pp. 35–45.
Kouni, Z., Koutsoukos, M., and Panta, D. (2018). “Transformational Leadership and Job Satisfaction: The Case of Secondary Education Teachers in Greece.” Journal of Education and Training Studies, 6(10), p. 158: https://doi.org/10.11114/jets.v6i10.3451.
Lan, X. M., and Chong, W. Y. (2015). “The Mediating Role of Psychological Empowerment Between Transformational Leadership and Employee Work Attitudes.” Procedia – Social and Behavioral Sciences, 172, pp. 184–191: https://doi.org/10.1016/j.sbspro.2015.01.353.
Ling, Q., Lin, M., and Wu, X. (2016). “The Trickle-Down Effect of Servant Leadership on Frontline Employee Service Behaviors and Performance: A Multilevel Study of Chinese Hotels.” Tourism Management, 52, pp. 341–368: https://doi.org/10.1016/j.tourman.2015.07.008. Locke, E. A. (1968). “Toward a Theory of Task Motivation and Incentives.” Organizational Behavior and Human Performance, 3(2), pp. 157–189: https://doi.org/10.1016/0030-5073(68)90004-4.
Luturlean, B. S., Prasetio, A. P., and Saragih, R. (2019). “Increasing Employee’s Job Satisfaction Through the Implementation of Transformational Leadership and Work Stress Level Management.” Journal of Management and Marketing Review, 4(3), pp. 209–217: https://doi.org/10.35609/jmmr.2019.4.3(6).
Malik, W. U., Javed, M., and Hassan, S. T. (2017). “Influence of Transformational Leadership Components on Job Satisfaction and Organizational Commitment.” Pakistan Journal of Commerce and Social Sciences, 11(1), pp. 147–166.
Martinaityte, I., Sacramento, C., and Aryee, S. (2019). “Delighting the Customer: Creativity-Oriented High-Performance Work Systems, Frontline Employee Creative Performance, and Customer Satisfaction.” Journal of Management, 45(2), pp. 728–751: https://doi.org/10.1177/0149206316672532.
Maslow, A. H. (1943). “A Theory of Human Motivation.” Psychological Review, 50(4), pp. 728–751: https://doi.org/10.1037/h0054346.
Ng, H. S., Kee, D. M. H., and Ramayah, T. (2016). “The Role of Transformational Leadership, Entrepreneurial Competence and Technical Competence on Enterprise Success of Owner-Managed SMEs.” Journal of General Management, 42(1), pp. 23–43: https://doi.org/10.1177/030630701604200103.
Para-González, L., Jiménez-Jiménez, D., and Martínez-Lorente, A. R. (2018). “Exploring the Mediating Effects Between Transformational Leadership and Organizational Performance.” Employee Relations, 40(2), pp. 412–432: https://doi.org/10.1108/ER-10-2016-0190.
Purohit, H., Yadav, A., and Goyal, S. (2016). “Validation of Minnesota Satisfaction Questionnaire: A Study of Front-Line Retail Employees.” SSRN: https://doi.org/10.2139/ssrn.2864211.
Rudd, H., Kent, T., Blair, C. A., and Schuele, U. (2009). “Leader Behavior Inventory: A Test of Measure Equivalence in Germany and the United States.” International Journal of Leadership Studies, 5(1), pp. 22–36.
Ryan, R. M., and Deci, E. L. (2000). “Self-Determination Theory and the Facilitation of Intrinsic Motivation, Social Development, and Well-Being.” American Psychologist, 55(1), pp. 68–78: https://doi.org/10.1037/0003-0066X.55.1.68.
Saleem, H. (2015). “The Impact of Leadership Styles on Job Satisfaction and Mediating Role of Perceived Organizational Politics.” Procedia – Social and Behavioral Sciences, 172(27), pp. 563–569: https://doi.org/10.1016/j.sbspro.2015.01.403.
Top, M., Akdere, M., & Tarcan, M. (2014). “Examining Transformational Leadership, Job Satisfaction, Organizational Commitment and Organizational Trust in Turkish Hospitals: Public Servants Versus Private Sector Employees.” The International Journal of Human Resource Management, 26(9), pp. 1259–1282: https://doi.org/10.1080/09585192.2014.939987.
Umadia, K., and Kasztelnik, K. (2020). “The Financial Innovative Business Strategies of Small to Medium Scale Enterprises in Developing Country and Influence for the Global Economy Performance.” SocioEconomic Challenges, 4(3), pp. 20–32: https://doi.org/10.21272/sec.4(3).20–32.2020.
Valdiserri, G. A., and Wilson, J. L. (2010). “The Study of Leadership in Small Business Organizations: Impact on Profitability and Organizational Success.” The Entrepreneurial Executive, 15, p. 47.
Wang, Y., and Poutziouris, P. (2010). “Leadership Styles, Management Systems, and Growth: Empirical Evidence From UK Owner-Managed Smes.” Journal of Enterprising Culture, 18(3), pp. 331–354: https://doi.org/10.1142/S0218495810000604.
Weiss, D. J., Dawis, R. V., England, G. W., and Lofquist, L. H. (1967). “Manual for the Minnesota Satisfaction Questionnaire.” Minnesota Studies in Vocational Rehabilitation, XXII: https://vpr.psych.umn.edu/sites/vpr.umn.edu/files/files/monograph_xxii_-_manual_for_the_mn_satisfaction_questionnaire.pdf.
Yalabik, Z. Y., Rayton, B. A., and Rapti, A. (2017). “Facets of Job Satisfaction and Work Engagement.” Evidence-Based HRM: A Global Forum for Empirical Scholarship, 5(3), pp. 248–265.