The purpose of this thesis is to determine the impact of leadership styles on the business. Specifically, the paper is aimed at defining the relationship between the leadership style and a certain unit performance.
To this objective, the first chapter introduces the reader to the leadership concept, shows its importance in the daily life and its correlations with the HR field. The theoretical insights into the leadership phenomena and its effects on the business are provided by the paper’s state of the art. Subsequently, the chapter of methodology presents the objective of the research and briefly the chosen company that the study is conducted on. It also defines the variables and describes the process of data collection and the participants. The chosen company is NN Group Romania, specifically, the NN subsidiary in Brasov, from which one of its units was empirically analysed. The analysed leadership styles are transformational and transactional types as I consider them to be the fundamentals of the styles. They serve as independent variables in the study. The SPSS software tests these variables for a potential correlation with the dependent variable, which is unit performance. The data was provided by twelve participants, consisting of one leader and eleven followers, who answered an online survey constructed in Sosci Survey.
Further, the chapter of practical approach starts with the explicit description of the company. Moreover, in order to generate numerical values for describing the relation between the variables, a linear regression model was implemented and interpreted. This chapter ends with recommendations to the company after proving that there are two positive correlations between the leadership styles and the unit performance in the chosen unit of NN Romania. Both transformational and transactional leadership influence the unit performance, and thus they have a positive impact on the business. Eventually, the conclusion of this paper summarizes the most significant concepts and findings as well as offers a personal perspective on the study.
Table of Contents
1. INTRODUCTION
2. THE EVOLUTION OF LEADERSHIP
2.1 Chronological definitions of leadership
2.2 The introduction of leadership style
2.3 Categorization of leadership styles
2.3.1 Transactional leadership
2.3.2 Transformational leadership
2.3.3 Servant leadership
2.3.4 Ethical leadership
2.3.5 Shared leadership
2.3.6 Lateral leadership
2.4 Conclusion and personal perspective
3. METHODOLOGY
3.1 Sampling and Data Collection
3.2 Participants
3.3 Hypothesis development
4. PRACTICAL APPROACH
4.1 Overview of the company
4.2 Information related to the hired personnel
4.3 Current situation of the leadership concept within the company
4.4 Multiple linear regression analysis
4.4.1 Testing of the assumptions
4.4.2 Interpretation of the results
4.5 Limitations
4.6 Recommendations
5. CONCLUSIONS
6. REFERENCES
Research Objective and Focus
The primary objective of this thesis is to empirically investigate the influence of transactional and transformational leadership styles on unit performance within a specific subsidiary of NN Group in Brașov, Romania, utilizing a quantitative approach to test whether these leadership behaviors significantly correlate with team outcomes.
- Theoretical examination of leadership evolution and core styles.
- Quantitative assessment of the relationship between leadership and unit performance.
- Empirical analysis of transformational and transactional leadership impacts.
- Practical recommendations for leadership development and organizational performance improvement.
Excerpt from the Book
2.3.1 Transactional leadership
Bass’s conceptualization of transactional leadership is a traditional view toward the methods of motivation and animation of a group (Bass 1985).
The name of this leadership style finds its roots in an economic transaction described by Bass as the relationship between leader and worker (Bass 1985). Gandolfi and Stone emphasize that in other words, explaining that the leaders clarify their expectations and assumes that if the followers give them X, they will receive Y. Precisely, transactional leadership suggests that the settlement of goals is carried out more to the interest of the organization than to employees’ advantage (Gandolfi and Stone 2017). However, Tung argues that the relationship between leader and follower is built on a set of mutual benefits (Tung 2016). This notion finds its explanation in Bass’s model of transactional leadership which consists of 3 dimensions.
The first one refers to contingent reward, followed by two forms of management by exception (Bass 1985). Judge and Piccolo defines the contingent reward as the extent to which the leader “sets up constructive transactions or exchanges with followers” (Judge and Piccolo 2004, p. 755). Specifically, he sets up the exchanges by clarifying expectations and standards for performance and establishing the rewards for meeting the criteria.
Moreover, Bass describes the primary features by which the performance is encouraged in a transactional style (Bass 1985). Firstly, transactional leaders develop with their team members clear and specific goals and they promise the employees that they will get a certain reward for meeting the goals. Secondly, the rewards and promises of rewards are discussed. Finally, transactional leaders are receptive to the self-interests of employees if their needs can be fulfilled within the time the employees get their work done.
Summary of Chapters
1. INTRODUCTION: Discusses the necessity of leadership in a digitalized global market and introduces the core theme of self-reinvention within organizations.
2. THE EVOLUTION OF LEADERSHIP: Provides a chronological overview of leadership theories and categorizes various styles, including transformational, transactional, servant, ethical, shared, and lateral approaches.
3. METHODOLOGY: Details the research design, specifically the quantitative method used to measure the relationship between leadership styles and unit performance at NN Group.
4. PRACTICAL APPROACH: Presents the case study of NN Group, including corporate structure and an in-depth multiple linear regression analysis of leadership impacts on performance.
5. CONCLUSIONS: Synthesizes findings, confirming a significant positive relationship between leadership styles and performance, and offers final thoughts on effective management.
6. REFERENCES: Lists the academic literature and sources consulted throughout the research.
Keywords
Leadership, Transactional Leadership, Transformational Leadership, Organizational Performance, NN Group, Human Resource Management, Quantitative Analysis, Multiple Linear Regression, Employee Motivation, Leadership Styles, Corporate Management, Unit Performance, Self-Leadership, Workplace Efficiency, Leadership Training.
Frequently Asked Questions
What is the core focus of this graduation thesis?
The research examines the impact of transactional and transformational leadership styles on business performance, specifically focusing on the empirical analysis of a unit within NN Group in Romania.
Which leadership styles are primarily analyzed?
The study centers on transactional and transformational leadership, identifying them as the fundamental styles that correlate with organizational performance.
What is the main research question?
The study seeks to answer whether leadership styles influence unit performance and to what extent these styles impact organizational outcomes.
What research methodology was employed?
A quantitative methodology was used, involving an online survey distributed to twelve participants and statistical analysis via multiple linear regression and ANOVA.
What is discussed in the practical section of the paper?
The practical section describes the organizational structure of NN Group, details the data collection process, tests statistical assumptions, and interprets the regression model results.
What characterizes the key terminology of the research?
The terminology includes concepts such as contingent reward, management-by-exception, charisma, intellectual stimulation, and organizational performance metrics.
What did the results reveal about the leader's profile at the studied unit?
The findings indicated that while the manager perceived herself as more transactional, her subordinates identified her as being more transformational in her actual leadership behavior.
Does transformational leadership have a stronger impact than transactional leadership?
Yes, the regression analysis demonstrated that transformational leadership has a greater unique contribution to the unit's performance compared to transactional leadership.
What recommendations are provided for the leader?
The author recommends maintaining a mix of both styles while focusing more on transformational behaviors like individual consideration and stimulating innovation to further boost team performance.
- Quote paper
- Alexandra Vacaretiu (Author), 2020, What Is the Impact of a Certain Leadership Style on Business? A Closer Look On a Business Unit, Munich, GRIN Verlag, https://www.grin.com/document/920258
