Transactional and transformational leadership styles and their effects on organizational commitment

Leadership Styles

As the behavior of the leader, so is the behavior of the follower." This colloquial proverb can be seen in families. Angry parents tend to raise angry children. Similarly patient, and understanding parents who also know how to set boundaries tend to raise balanced, patient children. This observation can also be applied to the business environment. This study is concerned with behavior of workers within an organization, or company, and the study includes comparative evaluations of leadership styles and corresponding commitment of the workers within the organization. Many academicians and practitioners view leadership as the most important topic within the realm of organizational behavior (Rahim, 1981. The success of an organization is more heavily dependent on the quality of its leaders than on any other single factor. These leaders play a major role in making decisions that determine organizational goals and how these goals can be accomplished and how the organization functions during the process of pursuing its goals.

While many studies have sought to identify leadership styles and theories since the end of WWII, a new theory of leadership emerged in the 1970s. Burns (1978) first introduced the ideas of transactional and transformational leadership styles. A few years later, Bass (1985) expanded the theory and created the Multifactor Leadership Questionnaire (MLQ) to help track the evolution of the leadership styles. A few years later, Avolio and Bass (1991) introduced leadership theoretical models which included three styles of leadership:

transactional transformational laissez-faire.

These three styles are essential elements in this research and are discussed in greater detail in the body of this paper.

Organizational Commitment

Organizational commitment is the subsequent loyalty shown by the workers who operate under the various styles of leadership. Organizational commitment (OC) has received substantial attention in the past decade due. Businesses are increasingly realizing that leadership styles have significant impact on work attitudes such as job satisfaction, performance, absenteeism, and turnover intentions, and these factors have all been linked to the idea of OC (Mowday, Porter & Steers 1982).

Various scholars have defined OC in different words, but all have sought to catch the essence of the same concept.

Mowday (1979) defines OC as the relative strength of the identification between the individual and his involvement with his organization / business / employer. According to his definition, OC has three basic components:

strong belief in and acceptance of the organization's goals and values, which is termed identification

The willingness to exert a considerable effort on behalf of the organization, or the workers level of involvement strong intent or desire to remain with the organization, the worker's (loyalty (Mowday et. al. 1982).

Allen & Meyer (1990) define organizational commitment as a psychological link between the employee and his or her organization. This link is related to various job-related characteristics. According to Buchanan (1974), OC is no less than a necessary prerequesite for successful organizations.

It has been reported that "Organizational commitment should be of great interest to leaders, because managers with strong commitment tend to be highly productive and loyal, while those with lower levels tend to have higher incidence of turnover, and stress-related health claims" (Ward & Davis, 1995, p.35).

Statement of the Problem

The concepts of leadership (Kotter,1988) and OC (e.g. Mathies & Zajac, 1990; Mowday, Porter & Steers, 1982; Steers, 1977) have been key areas of research for theorists and researchers for decades. Investigating leadership characteristics to determine which have the greatest effect on the desired outcome can greatly assist the organization as it charts its future. By measuring the strength of the leadership within the organization, and the associated willingness of the workers to follow, organizations can build on its strengths, initiate training to minimize its weaknesses, and thus combat any negative consequences that are typically associated with lack of OC within its staff. Purpose of the Study

This dissertation investigates the three leadership styles and thrie relational influence on OC among Customer Service Manager's in the Network Services Customer Relationship Management Organization (NS Management.) at American Telephone and Telegraph (AT&T). Furthermore, this study will explore and identify significant relationships between selected demographic variables and OC in the Network Services Customer Relationship Management Organization at AT&T.

Specifically, the goals of this research are:

To determine the level of commitment of Customer Service managers' to the NS Management personnel.

To investigate the relationships between the transformational, transactional, and laissez-faire leadership styles and the level of OC among Customer Service managers'.

To determine if there are any relationship between age, gender, number of dependents, marital status, level of education, and tenure and the level of OC within the Customer Service managers' group.

To determine the relationship between Customer Service managers level of satisfaction with their leaders in relationship to the prevailing leadership style.

Variables

In this study leadership styles; transformational leadership behavior, transactional leadership behavior, and laissez-faire leadership behavior of area managers as perceived by Customer Service managers' are the independent variables. These are learned behaviors among the NS Management., and can be modified by company training. Five additional independent variables; age, gender, level of education, marital status, and tenure will be considered to determine if they affect the level of organizational commitment among AT&T Customer Service managers'. However, these are variables are intrinsic to the personnel, and cannot be significantly affected within the organization. Any relationships between this second set of variables and OC can be noted, and used by the NS Mantg. To understand their workforce in a given location. The dependent variable is the level of OC within the customer service managers, and their satisfaction with their leaders.

Assumptions

This study will be based on the following assumptions:

The participants' responses to the questionnaires will be honest and sincere.

The Multi-factor Leadership Questionnaire (MLQ) is an effective means for measuring AT&T Network Services Customer Relationship Area Managers' transformational, transactional, and lassiz-faire leadership characteristics.

The Organizational Commitment Questionnaire (OCQ) is an effective means for measuring AT&T Network Services Customer Service Manager's, affective and continuance organizational commitment.

Limitations

This study has the following major limitations:

It is impossible to control all interactions and exchanges between AT&T Network Services Customer Service Managers and Area Managers that might affect Customer Service Managers commitment, and managers' perceptions of OC. Only impacts of 8 variables will be studied.

The applicability of the findings to leadership beyond the Network Services Customer Relationship Area Managers' cannot be ensured.

This study was mainly concerned with examining the effects of leadership styles upon organizational commitment of AT&T Network Services Customer Service Manager's. Therefore, future research is recommended to discover factors influencing OC at other levels of the company.

All subjects of the study were Customer Service managers and Area managers within the AT&T Network Services Customer Relationship Organization all other organizations were excluded.

Research Question

This study addresses the following question.

What is the relationship between followers organizational commitment questionnaire score (OCQ) and followers perception of leaders transformational style (MLQ) score, when controlling for age, gender, level of education, marital status, and tenure.

What is the relationship between followers organizational commitment questionnaire score (OCQ) and followers perception of leaders transactional style (MLQ) score, when controlling for age, gender level of education, marital status, and tenure.

What is the relationship between followers organizational commitment questionnaire score (OCQ) and followers perception of leaders lassiez-faire style (MLQ) score, when controlling for age, gender, level of education, marital status, and tenure.

Definition of Terms

The following terms are defined in the context in which they are used in this study:

Area managers': Second-level managers in AT&T Network Services Customer Relationship Organization who have Network Services Customer Relationship Specialists reporting directly to them.

American Telephone and Telegraph (AT&T): premier voice and data communications company serving more than 80 million customers

Customer Relationships Organization: an organization within AT&T that handles Growth and Global long distance accounts that generate up to 50 million dollars a year in revenue.

Customer Service managers: Managers or supervisors in AT&T Network Services Customer Relationship Organization who hold a first level management title with no workers reporting to them. Their primary job function is to interact with customer on account issues.

Leadership style: refers to the pattern or constellation of leadership behaviors that characterize a given leader (Williams, 1978, p.217).

Populations Demographics: refers to the AT&T Network Services Customer Relationship Organization managers' characteristics which are concerned with age, gender, level of education, number of dependents, marital status, tenure, and years in CSM title.

Tenure: the length of time an employee has been employed in the present organization

Transformational leadership: "the process of influencing major changes in attitudes and assumptions of organizational members and building commitment for the organizations' mission and objectives" (Yukl, 1989, p. 204). This leadership style focuses on the leader-follower relationship to benefit both the individuals involved and the organization as a whole (Bass, 1990; Bass & Avolio, 1994; Burns, 1978). Transformational leaders are those who seek to motivate followers to do more than originally was expected (Bass,1985).

Transactional leadership: leadership based on an exchange process between leaders and followers (Burns, 1978). Transactional leaders focus on clarification of task requirements and the specification of contingent rewards (Bass, 1990).

Laissez-faire: a style used by some leaders who try to maintain a 'country-club' atmosphere avoiding responsibility and decision making (Bass, 1997).

Organizational commitment: "the strength of an individual's identification with and involvement in a particular organization" (Porter et. al., 1974, p 604). OC is a measure of a personal psychological link between the employee and his/her organization that has been found to be related to various job-related characteristics (Allen & Meyer, 1990).

Summary and Overview

Chapter 1 was an introduction to the study. In this chapter, the researcher outlines the nature of the leadership styles, the purposes of and underlying principle for this study, why leadership styles is critical in corporate America today, and the importance of investigating the correlation between managers' leadership styles and managers' perception of OC. The outline of this study was specified, and the research questions, assumptions, limitations, and definitions of terms were stated.

Chapter II contains a review of related literature and the conceptual framework of the study. The research methodology is described in Chapter III. Results of data analysis are presented in Chapter IV. Chapter V includes a summary of the research, findings, conclusions, recommendations, and reflections.