The Impact Of Leadership Styles On Employee Performance: A Case Study Of Al-Ghazi Tractor Factory

The importance of leadership in employee performance

Discuss about the Interpretivism and Analysis of Traditions and Practices.

The performance of the employees in an organization depends on many factors. This includes various motivational factors, and leadership is one of them. All organizations in the world require great leadership style to inspire and motivate the employees to put forward their best effort to achieve the organizational and personal goals (Butt, Katuse & Namada, 2018). Great leaders can make the employees feel important, which would inspire them to increase their productivity, creativity and get job satisfaction. Employee performance consists of many duties like, meeting deadlines, achieving competency, efficiency and effectiveness in performing a work in the best possible manner. To stimulate the employee performance, strong leadership styles are required in the organizations.

The problems in the employee performance can ground up from many things in an organization. At the same time, the nature of problems differs according to the nature of jobs in different types of organization. For example, in the tractor factories, there is lower productivity, poor innovation, inability to meet the targets, and these occur from the lack of strategic interventions by appropriate and effective leadership styles, required for particular situations (Azizpourm, Ebrahimi & Alipoor, 2013). The employee performance was affected continuously for this issue. Thus, it can be said, specific leadership styles are required to address particular types of problems in the organizations.

Leadership style refers to the approach and manner for providing direction to the followers, implementation of plans and motivating and inspiring people. The followers perceive the leadership styles as the implicit and explicit actions by the leaders (Oskar, 2017). The major dfferent types of leadership styles exist, namely, autocratic or authoritarian, democratic or participative, and delegative. Al-Ghazi Tractor Factory is a Pakistani tractor manufacturing company, headquartered in Karachi, Pakistan. It is authorized to assemble and manufacture the New Holland tractors by collaborating with Fiat New Holland (Alghazitractors.com., 2018). This factory has also been facing some problems related to the employee performance. The purpose of the research study is to explore the motivational issues and employee performance in the Al-Ghazi Tractor Factory and the impact of leadership styles on the performance of the employees. The purpose of this assignment is to prepare and present a research proposal on the business research on the topic mentioned above.  

The organization of the study is as follows. Section 1 presents the introduction of the research topic, followed by problem statement, research aim and objectives, and research questions, in section 2 and 3 respectively. Section 4 contains justification and potential outcome of the research. Section 5 focuses on conceptual framework and hypothesis development and in section 6, research methodology will be presented, which includes organization of the research, Gant chart and budget schedule of the research.

Specific problems in employee performance in organizations

Effective leadership is required in all kinds of organizations for inspiring the employees to achieve the organizational goals in the most efficient manner. The employees also expect that there should be an effective leader who can lead them to bring changes and improve their performances. Thus, the problem statement for this paper is the effectiveness of leaders to change or improve performance of the employees and impact of different leadership styles on the employee performance in the context of the Al-Ghazi Tractor Factory.

The aim of the research paper is to explore different styles leadership and their suitability in different situations in an organization arising from the performance of the employees.

The objectives of the paper are:

• To explore the leadership styles contributing in enhancing the employee performance
• To evaluate the differences between the employee performance and leadership performance
• To assess the impact of leadership on the employee performance

The research questions are:

1. What are the different styles of leadership that are affects the employee performance?
2. What is the difference between employee performance and leadership performance?
3. What are the impacts of leadership on the employee performance?

The research will focus on exploring different types of leadership and its different aspects. It will also illustrate how the leadership styles have effective impact on the employee performance in any organization. Hence, through this study, the researcher will present the insight about various aspects of leadership styles. By conducting a comprehensive literature review on leadership styles and their impact and effectiveness, the researcher will address the research questions to explore the influence of leadership styles on the performance of the employees in an organization. With this knowledge, the leaders can plan and make strategies to address the employee performance related issues in the organizations and increase the competitiveness.

The potential outcome of the research includes the knowledge gained on leadership and its impact on employees of any organization. By applying this knowledge, the future researchers can explore further to application of different leadership styles and their relevance and significance in any particular situation. It is also beneficial for the organizations, as they can apply the knowledge in order to achieve an efficient working environment and can motivate the employees with right kind of leader. They can assess the need of the leaders and type of leadership to be applied in any particular problem situation and can opt for the proper leadership style that can address that in the most effective manner. Since, the study will be based on the employee performance issues of the Al-Ghazi Tractor Factory, the outcomes are expected to bring changes in the organizational performance through the implementation of effective leadership.

According to Mulki, Caemmerer & Heggde (2015), leadership style refers to the approach of a leader to provide direction to the followers, making and implementing plans and inspiring and motivating people. There are various styles of leadership that displays different principles of motivating the followers. In every field of organizational or mass activities, an effective leadership is required to channel the resources in the right direction. A leader must have variety of abilities and among those, observational and interpretation skills are extremely crucial. Along with that, the conceptual abilities regarding the judgment of the situation, innovation, domain knowledge, interpersonal act are all important for identifying a crisis situation and providing a relevant solution to situation (Ahmad, Hussain & Tariq, 2014). Effectiveness of the leadership is reflected in the performance of the followers.

Different types of leadership styles and their impact

Different leaders follow different leadership styles to influence the followers. There are many different approaches to leadership. The first approach was first given by Kurt Lewin in 1939. His study identified three major types of leadership, autocratic or authoritarian, democratic or participative and laissez-fair or delegative (Northouse, 2018). In autocratic leadership style, the leaders impose their own thinking and approach on how to do a job on the subordinates, without discussing with them or getting their advice. In the participative or democratic style, the leaders include one or two subordinates in the decision making process, however retain the final decision making power. Lastly, in the laissez-fair or delegative style, there is free reign, that is, the leaders allow the employees to make decisions but still remain responsible for the decisions taken (Ahmad, Hussain & Tariq, 2014).

As per the demand of the situation, the leaders must make the judgment to apply the most relevant leadership style. However, authoritarian should be used rarely as it dictates the employees to work as per the leader’s orders. The most commonly used leadership style is the participative, as that makes the leader to lead from the front. That instills more confidence among the employees when they get the opportunity to work together with the leader (Nanjundeswaraswamy & Swamy, 2014). This also brings out the best in the employees as they get motivated by the attitude of the leader. Lastly, delegative leadership style is also not much used. In this approach the leader leaves the responsibility of decision making on the subordinates while they stay back. However, there are certain situations that demand for delegative leadership. Amount of available time, basis of relationship, availability of information, more domain knowledge of the employees, internal conflicts, stress levels are such few situations in which delegative leadership brings better outcomes.

There are many other theories of leadership. Two most theories are transformational and transactional theories of leadership. Burns, Bass and Kouzes and Posner developed three transformational leadership theories. The common essence of these theories is that, the leaders transform the followers and subordinates through their charismatic personality and inspirational nature (McCleskey, 2014). This leadership style helps in motivating the followers through their actions and personalities. On the other hand, the transactional leadership theories emphasize the relation of the leaders and the followers on the basis of transaction. In other words, these are also known as exchange theories of leadership, and are characterized by transactions between the leaders and the followers. As stated by Northouse (2018), a positive and mutually beneficial relationship is the basis of motivation of the followers and also the transactional leadership theories. Charismatic leadership style is an extension of the transformational leadership. Charismatic leaders influence the followers to endorse to their vision and execute it passionately through the combination of personality and charm (Avolio & Yammarino, 2013).

Research study on employee performance in the Al-Ghazi Tractor Factory

Another important approach of the leadership style is described through the contingency or situation leadership theories. These theories state that the leadership style should not follow any particular approach throughout the time; rather the leaders should change their style of leading according to the situation or contingency (Antonakis & House, 2013). How the leaders behave in any particular situation act as an influencing factor for the followers. The most famous contingency leadership theories are developed by Fiedlers, Hersey-Blanchard.

In an organization, there are number of factors that influence the performance of the employees. These factors work as motivators for the employees. Working environment, remuneration, rewards and recognition, supportive management, bonus and incentives, flexibility, leave policies are some of the organizational factors that influence the employee performance (Yusoff, Kian & Idris, 2013). Employee performance is highly related to the job satisfaction and that is in turn depends on the above mentioned factors. Herzberg classified these factors into two groups in his motivation-hygiene or two factor theory of motivation. According to Herzberg, certain factors in the workplace cause job satisfaction, known as the motivation factors and others cause dissatisfaction, known as the hygiene factors (Miner, 2015). In an organization, challenging work, recognition, responsibility, involvement in the decision making, achievement, opportunity for doing something meaningful or important give positive satisfaction from the intrinsic job conditions and these are classified as motivation factors. On the other hand, status, fringe benefits, salary, job security, work conditions, insurances, vacations are classified as the hygiene factors (Ozguner & Ozguner, 2014). In regard to the impact of leadership styles on the employee performance, it can be said that, it influences the motivational factors for the employees. Through the leadership style, the leaders can motivate the employees through recognition and rewards, giving them due respect, sense of achievement and importance in the organization, opportunity for personal growth and involvement in the decision making. Hence, leadership is important for improving the job satisfaction as well as the performances of the employees by inflicting a sense of motivation among them.

Research methodology refers to the strategy of plan of the researcher on how to proceed with the study to address the research questions (Neuman, 2013). It describes the research approach, strategy, design, data collection and analysis process for the study, which would be adopted to conduct the research. In the given research, the researcher wants to explore the relationship between the leadership styles and their impact on the employee performance in the context of Al-Ghazi Tractor Factory in Pakistan. To conduct the study, the research methodology to be adopted is as follows.

Organization and aims of the research study

The researcher will adopt the qualitative research method for this study. The topic is expected to measure the impact of leadership styles on the performance of the employees. Hence, this is a qualitative aspect and people’s perspective will differ in such cases. Thus, interpretivism research paradigm will be followed. Under interpretivism, the observation and interpretation skills of the researcher are very crucial. It integrates the human aspect into a research study (Bevir & Rhodes, 2012). This gives way to the qualitative analysis of the study.

The deductive research approach will be applied in this study. Under this approach, the researcher will test the research observation against already established theories of leadership styles and its relevance in a particular situation related to employee performance. In this given research, the researcher will follow the case study research strategy. The research study is expected to test the topic on the influence of leadership on the performance of the employees in the Al-Ghazi Tractor Factory in Pakistan. Hence, the Al-Ghazi Tractor Factory is taken as the case study company and the research problem will be tested by using the data on the performances of the employees of the Al-Ghazi Tractor Factory.

The researcher will apply the focus group and interview method to gather the primary data on the specific research problem. The sample for primary data collection will be chosen from the employees of the Al-Ghazi Tractor Factory. A sample is a small subset of the population having the same characteristics (Levy & Lemeshow, 2013). Non-probability sampling technique will be applied to choose the sample size. In this type of sampling, the probability of each sample being chosen is dependent on the subjective judgment of the researcher than on random selection (Uprichard, 2013). Hence, 3 managers will be chosen for interview and 5 employees will be chosen for the focus group. These samples are chosen to get an in-depth insight and qualitative aspects about the research topic in the context of the tractor factory.

After the data collection, qualitative data analysis method will be applied. Thematic analysis under the qualitative data analysis will be most suitable in this case. Relevant themes will be chosen to focus on different aspects of the leadership styles and performance trend of the employees as well as organizational performance.

There will be the integration of secondary research. This is to make it possible for the provision of enough discussion so that the concerned readers may adequately understand much about this issue and all variables involved. In addition, previous reports on research, journal content, magazine, the newspaper articles, online publications and annual reports of the case study company will be included in the secondary research. Findings which are in existing journal and information in existing books will be referred as secondary sources for this research (Iqbal, Anwar & Haider, 2014).

Outcome of the research

Secondary data will be analyzed using qualitative data analysis process. Thematic analysis will be applied to classify the information and findings under different themes to validate the findings from the primary data.

The organization of the research study is as follows.

• Chapter 1 will be the Introduction. In this chapter, the researcher will present the background, research aim, objectives, questions and hypothesis.
• Chapter 2 will present the literature review on different types of leadership and it impact on the organizational culture.
• Chapter 3 will describe the methodology of the study in details that includes the research paradigm, approach, strategy, design, data types and collection process, sampling and analysis process.
• Chapter 4 will present the findings from the data analysis and its explanations to show the progress of the proposed research.
• Chapter 5 is the Conclusion, which will summarize the significant findings and their implications in the current research topic and will put forward some recommendations to improve the current situation.

The budget for the research study is $5000 to complete it within the timeframe, given in the gantt chart.

Purpose	Estimated cost
Literature review (Collection of textbooks, journals, and online resources)	$1500
Primary and secondary data collection	$2000
Data analysis (Use of software)	$1500
Total	$5000

Task Name	Duration	Start	Finish	Predecessors
Research project	47 days	Mon 5/14/18	Tue 7/17/18
Designing the framework	5 days	Mon 5/14/18	Fri 5/18/18
Literature review	10 days	Mon 5/21/18	Fri 6/1/18	2
Data Collection	15 days	Mon 6/4/18	Fri 6/22/18	2
Primary data collection (through focus group and interview)	7 days	Mon 6/4/18	Tue 6/12/18	3
Secondary data collection	4 days	Wed 6/13/18	Mon 6/18/18	5
Creating concepts for appropriate research methodology	4 days	Tue 6/19/18	Fri 6/22/18	6
Data analysis	7 days	Mon 6/25/18	Tue 7/3/18	4
Qualitative analysis of primary data	4 days	Mon 6/25/18	Thu 6/28/18	4
Qualitative analysis of secondary data	3 days	Fri 6/29/18	Tue 7/3/18	9
Final report	9 days	Wed 7/4/18	Mon 7/16/18	8
Thesis submission	1 day	Tue 7/17/18	Tue 7/17/18	11

 
Table 1: Project activities and schedule: Gantt chart

(Source: Author)

References

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Alghazitractors.com. (2018). Al-Ghazi Tractors Ltd. Retrieved from https://www.alghazitractors.com/

Antonakis, J., & House, R. J. (2013). The full-range leadership theory: The way forward. In Transformational and Charismatic Leadership: The Road Ahead 10th Anniversary Edition (pp. 3-33). Emerald Group Publishing Limited.

Avolio, B. J., & Yammarino, F. J. (Eds.). (2013). Introduction to, and overview of, transformational and charismatic leadership. In Transformational and Charismatic Leadership: The Road Ahead 10th Anniversary Edition (pp. xxvii-xxxiii). Emerald Group Publishing Limited.

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Levy, P. S., & Lemeshow, S. (2013). Sampling of populations: methods and applications. John Wiley & Sons.

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Northouse, P. G. (2018). Leadership: Theory and practice. Sage publications.

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Yusoff, W. F. W., Kian, T. S., & Idris, M. T. M. (2013). Herzberg’s Two Factors Theory On Work Motivation: Does Its Work For Todays Environment. Global journal of commerce and Management, 2(5), 18-22.