An Empirical Study of the Relationship Between Transformational Leadership, Empowerment and Organizational Commitment

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Business and Economics Research Journal Volume 2 . Number 1 . 2011 pp. 89-107 ISSN: 1309-2448 www.berjournal.com

An Empirical Study of the Relationship between Transformational Leadership, Empowerment and Organizational Commitment Azman Ismail Hasan Al-Banna Mohamed Ahmad Zaidi Sulaiman d e Mohd Hamran Mohamad Munirah Hanim Yusuf a b c

Abstract: Abstract Organizational leadership literature highlights that transformational leadership has four salient features: intellectual stimulation, individualized consideration, individualized influenced attributed, and individualized influence behavior. The ability of leaders to properly implement this leadership style may have a significant impact on organizational commitment. More importantly, recent studies in this area reveal that effect of transformational leadership style on organizational commitment is indirectly affected by empowerment. The nature of this relationship is interesting, but little is known about the mediating effect of empowerment in organizational leadership literature. Therefore, this study was conducted to examine the influence of empowerment in the relationship between transformational leadership and organizational commitment using a sample of 118 usable questionnaires gathered from employees who have worked in one US subsidiary firm in East Malaysia, Malaysia. The results of exploratory factor analysis confirmed that the measurement scales used in this study satisfactorily met the standards of validity and reliability analyses. Further, the outcomes of Stepwise Regression analysis showed that the relationship between empowerment and transformational leadership positively and significantly correlated with the organizational commitment. Statistically, this result confirms that empowerment acts as a mediating variable in the relationship between transformational leadership and organizational commitment in the organizational sample. In addition, discussion, implications and conclusion are elaborated. Keywords Keywords: Transformational leadership, Empowerment, Organizational commitment words Classification: JEL Classification L20, M12, M19

1. Introduction Leadership is often referred to as a powerful and dynamic person who forms the path of a nation and this may affect the organizational management (Bono & Judge, 2003, 2005). In an organizational context, leadership is viewed as a prime force that may determine the organizational competitiveness in a global economy (Bass & Avolio, 1993, 1994; Bryman, 1992; Ismail et al., 2009). In order to support the objectives, a

Assoc. Prof., Faculty of Defence & Management Studies, National Defence University of Malaysia, Kuala Lumpur. Malaysia, azisma08@gmail.com (Corresponding Author) b Lecturer, Faculty of Defence & Management Studies, National Defence University of Malaysia, Kuala Lumpur. Malaysia, hasanalbanna@upnm.edu.my c Lecturer, Center for Defence Foundation Studies, National Defence University of Malaysia, Kuala Lumpur. Malaysia, zaidi@upnm.edu.my d Lecturer, Faculty of Defence & Management Studies, National Defence University of Malaysia, Kuala Lumpur. Malaysia, hamran@upnm.edu.my e Lecturer, Faculty of Defence & Management Studies, National Defence University of Malaysia, Kuala Lumpur. Malaysia

Relationship between Transformational Leadership, Empowerment and Organizational Commitment

leaders often choose particular interaction styles that may represent the values and motivations, the wants and needs, the aspiration and expectation of both leaders and followers (Howell & Avolio, 1993; Hartog et al., 1997; Ismail et al., 2010). For example, interactions in the traditional leadership approach emphasize on the ability of followers to accomplish job targets as set up by their superiors (Bass, 1985; Howell & Avolio, 1993; MacKenzie et al., 2001; Rowold, 2008). Conversely, interactions in the contemporary leadership approach focuses more on the quality of relationship with followers, such as building...
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