Leadership Organisational Performance And Emotional Intelligence Management Essay

Leadership Organisational Performance And Emotional Intelligence Management EssayIntroduction to the ProblemThe difficulty in topicing concepts much(prenominal) as leading, governingal performance, worked up learning and the interrelations between the three constructs, is that these terms are hard to define, describe, and to measure systematic bothy. The disagreement among theorists concerning the definitions of these variables has led to further controversy about seek bod and instrumentation and to exacerbate this situation, there appears to be few gains macrocosm made to improve our understanding of these strategic concepts. Leadership is a difficult concept to amply appreciate and understand. Burns (1978) comments that Leadership is mavin of the most observed and least understood phenomena on earth (p. 19). This statement appears to be just as original and accurate today as it was when Burns made it. Since Burns made this powerful statement, the interest in understandi ng leading and its consequences has intensified. While the term drawship has existed for centuries and has been most commonly associated with the military, the emergence of passenger car, as a leader, is a relatively new phenomenon.Because of the perceive and actual learn of managers and their importance to globalisation, prosperity, and economic growth, interest in this new leader has been and continues to be intense. thither are hundreds of studies that tend to popularise and evaluate managers to a level that seems unattainable by most. Yet for tout ensemble of the books, articles, and studies obtainable on leadership and the managers, who lead, there is very little known about the attitudes, behaviours and characteristics that engender effective manager performance. Even sparser is the information that tries to tie the leadership panache of the managers with their emotional intelligence on the performance of the organisation.When the substantial body of leadership liter ature is reviewed there appears to be two clear distinctions made by the scholars. 1 body of tame digestes on the internal dispositions or characteristics of the leaders while the second is concerned with the behaviours and activities of the same leaders. However, the connection between these two distinct views is non al slipway clear or easy to understand. The current study was undertaken in an effort to address round of the gaps in empirical research and to apply the results of transformational leadership in wiz of public listed self-propelling manufacturing companies, EPMB in Malaysia where there is a dearth of such information available for manufacturing industry. The purpose of this study was threefold (1) to prove the human affinity between a managers score on transformational leadership with the performance of the organisation (2) to explore the relationship between the constructs of transformational leadership and emotional intelligence and (3) to stimulate out if there is any positive relationship exists between organisational performance and transformational leadership with emotional intelligence presence. The current investigation extends prior empirical work in at least three ways. First, the study integrates trait and behavioural approaches to leadership effectiveness in a field that is relatively new ace for the study of transformational leadership. Second, the total population consisted of practicing managers. Presently, there are very few empirical studies that examine the relationship among managers, transformational leadership behaviours, their emotional intelligence capabilities and organisational performance. Third, both intention (financial performance measures) and subjective evaluations (direct report responses) of leader effectiveness and emotional intelligence capabilities were utilised. This study adds value to the current leadership literature and plays a sm exclusively graphic symbol in bringing an old idea into the lead ership light in Malaysia manufacturing industry.One frequently discussed theory is that of transformational leadership, freshman introduced by Burns in 1978. Transformational leaders change their organisations culture by inspiring a sense of mission and purpose about the importance of the groups work and stimulating new ways of cerebration and problem solving ( inscrutable Avolio, 1993). Transformational leaders inspire individuals within an organisation to work harder and to strive for the highest levels of performance ( thick, 1985). While Bass, Burns and Avolio support the applicability of transformational leadership to all forms of organisation, which includes the largest public companies, other investigators find transformational leadership is not universally applicable to organisations (Inkson, Kerr and Moss, 1993). To exacerbate the situation, there is no evidence to say emotional intelligence is the discuss factor to transformational leadership towards improving organisa tional performance.Background of the debateAn understanding of the interplay between transformational leadership and organisational performance is an important factor for developing effective organisations. Finding ways to optimise the performance of people and hence, the organisation has been, and continues to be, a major concern for organisational leaders. Thus exploration on emotional intelligence capabilities of leaders is essential too.In todays service-establish, knowledge economy, many companies are sustainning to shift away from traditional models of management, originally developed for production oriented firms, and now require a broader incline of leadership skills and styles that are adaptive to diversity and to dramatic, often discontinuous changes in the work environment. As globalisation becomes more pronounced especially in automotive industry, the changes may become raze more dramatic as firms struggle to meet competition that only a few decades ago did not even exist. Some of the promising paradigms of leadership are including people in them and tend to describe people, which include managers, as the organisations most important assets. A summary of some of these is as follows concern for people (Blake Mouton, 1964), the value of people (Sashkin, 1984), human concern (Kilman Saxton, 1991), individualized consideration (Bass, 1985), and people orientation (Cooke Lafferty, 1994). The importance of motivating people to slay tasks at a high level so that the organisation performs fountainhead is a key role of manager especially in Malaysia manufacturing industry and was ane of the main reasons for this study. Transformational leaders motivate followers both to work for transcendental goals and to increase commitment and in doing so, perform beyond the expectations those followers endure for themselves. teaching of the ProblemThe problem in this study was to determine the degree of relationship that exists between transformational leaders hip, emotional intelligence and organisational performance as measured by reaping of capital engageed (ROCE) in one of local public listed automotive manufacturing company in Malaysia. The lack of current knowledge on this subject and between these variables hinders our ability to place a value on transformational leadership and emotional intelligence capabilities and their importance in organisational performance.By knowing such knowledge, it would help EPMB managers to employ effective transformational leadership effectively in the organisation, rather than transactional leadership which is primarily task-focused. Research indicated that transactional leadership was limited in terms of effectiveness (Vishalli Kumar, 2004).Purpose of the get windThe purpose of this quantitative descriptive correlational study was to determine the relationship of transformational leadership to organisational performance in one of the local public listed automotive manufacturing companies in Mal aysia, EPMB. The study utilised the Multi-factor Leadership Questionnaire developed by Bass and Avolio in 1995 (MLQ-5X) and Emotional Competence Inventory (ECI) widely used by Boyatzis et al., 1999 in emotional intelligence research, to measure the level of transformational leadership and emotional intelligence capabilities respectively in each subsidiary companies of EPMB, i.e. PEPS-JV, EPP, FUNDWIN and EPMD. The overall strategy was to quantify the level of transformational leadership and emotional intelligence capabilities using scores on the MLQ and ECI respectively, and then correlate these with the organisations performance measured objectively by the organisations ROCE during the same period under these leaders.The focus of correlational research is to describe the relationships among variables rather than determine a cause-and-effect relationship. Correlational studies are useful to describe how one observable fact is link to another(prenominal) in situations where there is no control over some of the research variables (Lappe, 2000). In the current study, the variables of emotional intelligence and transformational leadership were believed to influence the organisational performance.Research QuestionsThe chase research questions were addressed in this study for EPMB company.Q1 Is there a significant relationship between transformational leadership and organisational performance?Q2 Is there a significant relationship between transformational leadership and emotional intelligence?Q3 Is there a significant relationship between transformational leadership with emotional intelligence and organisational performance?This study answered these questions through and through the analysis of data gathered utilising the MLQ-5X (Bass Avolio, 1995) and ECI (Boyatzis et al., 1999 Wolff, 2006). These questions were converted to hypotheses as below since this was a quantitative study and it is advisable that quantitative studies have either research questions or hyp otheses, scarce not both (Creswell, 2003).The following are statements of null and alternative hypotheses that correspond to the research questionsH10 There is no statistically significant relationship between transformational leadership and organisational performance.H1A There is a statistically significant, positive relationship between transformational leadership and emotional intelligenceH20 There is no statistically relationship between transformational leadership and emotional intelligence.H2A There is a statistically significant, positive relationship between transformational leadership and emotional intelligence.H30 There is no statistically significant relationship between transformational leadership with emotional intelligence and organisational performance.H3A There is a statistically significant, positive relationship between transformational leadership with emotional intelligence and organisational performance.Significance of the StudyThis research project yielded new information regarding the importance of transformational leadership style to the automotive manufacturing companies in Malaysia. For the organisations performing well, this information presented the opportunity to understand the importance of leader and follower development to continue performing well, and for those not performing to a connatural level, the data is cause for reflection and an opportunity for improving development policies or changing leadership styles. Since the data gathered in this study does indicate a significant relationship between transformational leadership style and the performance of the organisation with and without emotional intelligence presence, further research should be undertaken to build on this finding and hopefully to improve on the understanding and meaning of the relationships.Of equally important significance due to the dearth of information available on the relationships between the three constructs in Malaysia, the results of this study wil l be made available to all companies that participated. This study is a small start in the right direction for companies that need leaders to continue to attract the right people for sustainable performance. Bass and Avolio (1992) have concluded that transformational leadership is important and that leadership training of managers at all levels should become an integral component of organisational education. A final component of this study is its potential impact on the selection and hiring of managers. Managers typically have an enormous impact on their organisations, constituents, and communities. Therefore, the compounded costs of making a mistake in the selection, hiring, or promotion of managers can be financially and operationally staggering. If transformational leadership is the correct and upcoming style for automotive manufacturing companies in Malaysia, then the selection teams could begin to narrow the focus and save time, money, and maybe companies by selecting the most effective leaders to lead their companies. In addition, since there are relationships between the variables, additional predictors of manager success can now be developed and shared with other organisations in Malaysia, thereby aiding in industry development and expansion and possibly enhancing Malaysias warring position.Definition and TermsFor the purposes of this research study, there are several terms that are necessary to address and they are as follows.Correlation. A correlation exists when the measurements of one variable either increases or decreases as the other variable increases or decreases (Leedy Ormrod, 2005).Correlational study. Correlational research study designs involve either the identification of characteristics in an observed phenomenon or exploring possible correlations regarding two or more variables (Leedy Ormrod, 2005).Descriptive research design. A means for providing a systemic manner by which facts and/or characteristics of an existing occurrence, or oc currences, are described (Leedy Ormrod, 2005).Emotional intelligence. The ability to recognise ones own feelings and the feelings of others for the purpose of motivating ourselves and for effectively managing the emotions in ourselves and in others (Wolff, 2006).Organisational performance. In this study, it was delineate as return on capital employed (ROCE) over 2005-2009.Quantitative research approach. A method by which researchers use post positivist acclamations in creating facts and predetermined inquiries such as experiments, surveys, and data collection tools to measure statistical data (Creswell, 2003).Transformational leadership. This is the basis for the study and the researchers primary interest. It could mean different things to different readers unless right defined. For Bass and Avolio (1993), transformational leadership contains the interrelated components of charisma or idealised influence (attributed or behavioural), inspirational motivation, intellectual stimulat ion, and individualised consideration. Transformational leadership behaviours are influential in motivating follower change and transforming followers to be more aware of task outcomes, activating their highest order needs, and extending beyond their own self-interest for the benefit of the organisation.AssumptionsThe first assumption in this study was that transformational leadership is an effective leadership style based on previous studies even though none have been related to the automotive manufacturing companies in Malaysia. Most previous studies were related to the military, non-profits institutions, or educational institutions. A second assumption was that there are similarities between the subsidiary companies of EPMB being researched even though they operate in different ways due to their products, customers and locations. It is possible that organisational performance is impacted by business climate to a similar degree as that by transformational leadership. A third and f inal assumption was that the managers/leaders (self reports) more truthfully answer the MLQ-5X and ECI even though this may not be the case in all completed surveys. This has been reported in other studies regarding leadership and emotional intelligence, and may have affected data and perceived relationships between the variables studied. The researcher was cognizant of these findings and tried to ensure that steps were taken to minimize such influences.LimitationsBias within a study can be minimized by not exposing the purpose or desired outcome to participants. The population for the current study was limited to 20 managers within EPMB who participated by fetching the MLQ-5X (Bass Avolio, 1995) and ECI (Boyatzis et al., 1999 Wolff, 2006). Although the participants were informed of the study, no specifics were given as to the purpose or desired outcome.The population for the current study was limited because of availability, EPMB permission, and the amount of time available to c lear the study. The study was limited to managers who identify themselves as having worked a company in one of the subsidiary companies during the fiscal year of 2005.The population studied was quantitatively small, but it was an accurate representation of all managerial skill levels. This was because the sample population accounted 42.6% of all managers in EPMB. In addition, the sample group exemplified the various mix and types of trading operations throughout the organisation. The validity of the study was limited to the reliability of the structured testing instrument along with the participants perception of their leadership behaviours.A relatively new, self-reporting instrument (see vermiform process A) was used to measure the levels of transformational leadership and emotional intelligence within managers using MLQ-5X and ECI respectively. The instrument for the current research study was considered cross-sectional since data were collected during one particular timeframe a nd not over a period of years (Creswell, 2003 Leedy Ormrod, 2005). Cross-sectional and self-reporting instruments are necessary for the assessment of self and others, but they have limitations.Nevertheless, Emmerling and Goleman (2003) stated that the limitations of such tests produced an insignificant amount of discrepancy. Most of the self-reporting instruments are primarily concerned with the connection between detailed behaviors and explicit personas. Self-reporting instruments are better indicators of organisational performance than self-assessment tools (Emmerling Goleman, 2003). detailed talk Framework and Study versatiles get word 1.1 is a more detailed representation of the relationship between transformational leadership (TL) and emotional intelligence and their impact can have on the performance of the organisation as a whole. The underlying premise is that transformational leadership does influence individuals who in turn impact the organisation with emotional intell igence as a moderating factor. The question that this study tried to answer was What are the relationships and how do the relationships impact ROCE in the organisation over time? The elements in Figure 1.1 marked with the asterisks are those that were identified in the literature as being the most prevalent especially in studies that cited the work of Bass (1985), and Bass and Avolio (1990, 1995). The overall flow of the diagram suggests that the leader impacts the follower, and as the leaders behaviors impact more and more followers and as the range of impact increases, the organisations performance is improved. As the organisation improves with respect to many of the measures highlighted in Figure 1.1, it affects the ROCE of the firm and that is what this study tried to determine.Transformational LeadershipEmployee Effects/ BehavioursOrganisational Effects/ Contributing FactorsAttributed charismaIdealised influenceInspirational motivationIndividualisedconsiderationManaging changeI ncreased productivityAchieving goalsCoordinating teamworkJob satisfactionIncreased self-confidenceIncreased performance(at all levels)***Increased follower motivation***Willingness to put forth extra effort***Increased optimismIncrease in learning activitiesIncrease in innovative cerebrationPerformance of ROCELower overall costsIncreased salesProactive change managementBetter communicationHigher corporate goalsBetter lineament productsIncreased customer serviceIncreased educational opportunitiesMore RD activitiesEmotional IntelligenceOrganisational Performance (measured by ROCE)Self-awarenessSelf-managementSelf-awarenessSocial awarenessSocial skillsFigure 1.1 Detailed framework with study variables and contributing factorsTable 1.1 identifies the major research questions in the study that were translated into hypotheses since the study is a quantitative one. It identifies the independent and dependent variables, as well as the statistical tests chosen to appropriately analyse the potential relationship between the dependent, independent and moderating variables. As outlined below, there were three research questions that were translated into three hypotheses (Hypothesis 1, Hypothesis 2 and Hypothesis 3), the independent variable (transformational leadership score), the dependent variable (ROCE), the moderating variable (level of emotional intelligence) and the applicable statistical tests.Figure 1.1 Research Questions, Hypotheses, Variables, and Statistical TestsQuestionHypothesesIndependent /Moderator VariableIndependent/ Dependent VariableStatistical TestWhat is the relationship between TL and ROCE performance?H1 There is no statistically significant relationship between transformational leadership and organisational performanceTL score on MLQ measured by questionnaires(Independent variable)ROCE performance(Dependent variable)Homogeneity of edition test, ANOVA analysis, Pearsons correlation coefficient,What is the relationship between TL and EI?H2 There i s no statistically relationship between transformational leadership and emotional intelligenceEI score on ECI measured by questionnaires(Section B)(Moderator variable)TL score on MLQ-5X measured by questionnaires(Section A)(Independent variable)Homogeneity of Variance test, ANOVA analysis, Pearsons correlation coefficientFigure 1.1 (Continued)QuestionHypothesesIndependent /Moderator VariableIndependent/ Dependent VariableStatistical TestWhat is the relationship between TL, EI and ROCE performance?H3 There is no statistically significant relationship between transformational leadership with emotional intelligence and organisational performanceTL score on MLQ-5X measured by questionnaires(Section A)(Independent variable)EI score on ECI measured by questionnaires(Section B)(Moderator variable)ROCE performance(Dependent variable)Partial correlation, Pearson correlation coefficient, and multiple regression analysisOrganisation of the Remainder of the StudyThe remainder of the study is de voted to the discussion of transformational leadership and emotional intelligence and their relationships to organisational performance based on several earlier studies. Chapter 2 is the literature review for the key variable in the study. Chapter 3 describes the methodology for the research study. Chapter 4 discusses the results of the questionnaire survey (MLQ-5X and ECI) in addition to the objective performance measure (ROCE) of the companies based on press releases, annual reports, and analysts reports. Chapter 5 is a discussion of the results including limitations of the measures and procedures, conclusions, and implications for future research.