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For as long as there have been people to lead, leadership has existed for them. It is an intangible
quality that, if properly carried out, leads to the success of an organization. Different people have
different and multiple ways of dealing with situations and other people. Every individual is
unique by his or her own personality, values and beliefs, and hence has a different style of
leadership. However, not every individual possesses the necessary skills to lead.

Leadership can be defined in many different ways. However, generally it can be taken as the
ability to influence and sway a group of people to reach one common goal. It is the vision and
unique style of an individual that makes him/her stand out as a leader. According to Bennis and
Nanus (1985), it¶s with the help of this vision and style only that an effective leader is able to
transform his or her beliefs in actions and reality. With leadership comes control that the leader
can exercise over others. Combining the influence and the control that the leader possesses, he or
she can guide others to perform tasks and activities to fulfill objectives all aimed at the
successful attainment of a goal that is beneficial to all (Gerber, Nel and Van Dyk, 1996:343).

Leadership is one of the most vital elements needed to run an organization successfully. An
organization is incomplete without management, and management is incomplete without
leadership. Although it is the central feature of an organization; however, it is needed at all levels
of an organization, be it the tactical tasks, operational activities or at the strategic level. Leaders
have a vision which is in the best interest of the company as well as its employees, hence in order
to achieve a common goal leaders motivate other employees to perform better in teams and
amalgamate their own individual objectives for more productivity. Not only do leaders have to
encourage and influence employees to perform better, they also have to constantly strive to
sustain and maintain those performance levels. For this purpose, leaders encourage new ideas,
creativity and innovation among employees whether it is in their everyday tasks at tactical level,
or whether it is up the pyramid at operational or even strategic levels. With all of this naturally
comes the need to constantly motivate the employees to perform better and sustain their own
performance levels and productivity. Therefore, a leader¶s job is not simply to have a vision and
pursue it; but also, it is to influence others to pursue it, direct them towards achieving one
common goal, encouraging employees to perform better, be creative, take risks and constantly
innovate at all levels, to sustain the better performance results and constantly, throughout the
process, motivate employees to improve their productivity levels.

As mentioned earlier, leadership aims to achieve a common goal by encouraging employees to

improve their productivity. Hence, it is necessary to define what employee productivity is.
Employee productivity is one of the measures of the performance levels of employees (Borman,
2004) and performance according to Greguras (1996) is the degree of contribution that a single
employee makes towards the attainment of organizational goals. Cummings and Schwab, (1973),
point out that leadership is one of the most widely inspected elements of an organization that has
a vital effect on the performance of employees.

However, not all styles or types of leadership are effective in every situation or scenario.
Different environmental settings have different requirements and hence require a different style
of leadership from the many that will be discussed later.


The research question for this dissertation is µwhat is the impact of leadership on employee
productivity and performance?¶ There are a multitude of factors that can have an impact on the
employee productivity and then ultimately the individual performance and the performance of
the organization as a whole. Here we will only see how leadership affects employee productivity
and performance. The effect can be negative and/or positive. There are various factors regarding
leadership from the personality of the leaders to the environment and motivation that a leader
provides to the different styles of leadership that a leader can adopt that influence employees in
their performance and productivity levels. Looking into the various theories and styles of
leadership, we¶ll see the consequences and impact each has on employee productivity and
performance of the individual and the organization as a whole. So, with the help of primary
research we will find out what factors influence a leader to be an effective leader, what factors
about the leader influence other employees and ultimately then develop the relationship between
leadership and employee productivity and performance.

According to earlier research different kinds and style of leadership, including autocratic,
paternalistic etc. have been able to positively as well as negatively affect employee productivity
and performance. Our purpose; therefore, is to further look into this research and find data of our
own to conclude firstly if this is really possible and if it happens to a considerable extent and also
to see how this can then be applied in different organizations and in different environments.


An inductive approach will be used for our research methodology where in order to find the
answer to the one main central question stated above, interviews will be conducted to ask a series
of various questions to get answers which will help in answering the one main question. In the
first part of the research we will find out what leader styles are prevalent in the organization.
Then we¶ll find out the employee productivity and performance levels of the individual
employees. The purpose of all this is to get an grounding understanding of what is happening in
the organization regarding our research. Then after a detailed analysis of the collected data, a
relationship between the variables leadership and employee productivity and performance levels
will be established.

The purpose of this research is to find the relationship and the link between leadership, employee
performance and productivity and how one variable affects the others. Hence the nature of our
research is an ë  ë
ë where causal relationship is established between variables in
certain situations.

Specifically for this research the strategy to be used will be an in depth 

 . For that
purpose one organization will be approached where the variables will be studied in details and
analyzed. Moreover, secondary research will also be conducted to establish a grounding
understanding of the variables involved in the research. Especially, the Full Range Leadership
Development Model developed by Bass and Avolio¶s (1997) will be used for this research I order
to provide the theoretical framework. Hence with the help of empirical data from many different
sources, the answers to the research will be reached more effectively. For explanatory research,
case study is one of the most efficient research strategies hence it has been chosen for our
research as well.

When conducting a case study, two dimensions can be used which are single case v/s multiple
cases and holistic v/s embedded case. In case of the first dimension either one unique case can be
studied in depth or multiple cases can be studied for the purpose of comparisons and seeing
whether the same conclusion is reached through every case study. Due to factors like limitations
of time and lack of easy access to multiple organizations, we¶ll be using single case study
approach. In case of the second dimension, even though we will be treating the organization as a
whole, individual teams or departments will be studied to see the different styles of leadership
within each unit. Hence, embedded case study will the approach for this research.



In order to survive in today¶s extremely fluctuating and changing world, organizations must
make different leadership styles a crucial and vital part of themselves (Maritz, 1995; Bass, 1997).
Simply leadership should not be employed; however, effective leadership is what is needed. 

There are any different styles of leadership ranging from authoritative or autocratic to democratic
styles. The traditional styles of leadership include:
ÄV Trait approach
ÄV Behavioral approach
ÄV Situational/ contingency approach
The new styles of leadership include:
ÄV Transactional leadership
ÄV Transformational leadership
Different styles are needed and suited in different environments and situations. With the
changing environments and organizations, a shift has taken place from the traditional more
authoritative styles of leadership to the more liberal, modern and democratic styles of leadership
so as to help the organizations survive and flourish (Johnson, 1995). It has been researched and
confirmed that transactional style of leadership is considered to be less effective than
transformational leadership style to influence employees and subordinates (Bass and Avolio,
1997). Those organizations which are over managed and under led face hindrance and hurdles in
their growth and positive change and to perform well (Swanepoel, Erasmus, van Wyk and
Schenk, 2000). Research shows that wholly or partly state owned organizations especially
needed effective leadership styles to improve their performance and employee productivity
(Brett Anthony Hayward, 2005).

The two new approaches of leadership are: the traditional style involving a transactional type of
a relationship between the leader and the employee where some sort of transaction or an
exchange takes place, and the transformational style that with the help of the charismatic
personality and behavior of the leader leads to a change in the the subordinate through the
influence that the leader has on him/her (Bass and Avolio, 1990a; Meyer and Botha, 2000).
Transactional style requires the subordinates to achieve the already set goals and perform at the
already set levels that are accepted by the leaders. Whereas, transformational leaders require the
subordinates to perform at levels higher than the accepted levels and make the goals of the
organization their own goals so that the effort that they put in is much more than otherwise.
Transformational leaders make the use of inspiration and their charismatic personality to
influence their subordinates.


The individual productivity of employees determines their performance and the total
performance of all the employees determines the overall performance of the organization. The
better the relations between employee and leaders the better the employees will perform.
However, there is a considerable disagreement over the fact that effective leadership essentially
leads to performance levels of organizations to be improved (Maritz, 1995; Bass, 1997; Charlton,
2000). Effective leadership is not the ends to improved performance levels but jus a means to
have improved performance of an organization. This is because simply leadership does not lead
to improved performance levels of the organizations but the actually the individual employees
who mae this happen (Cummings and Schwab, 1973; Hellriegel, Jackson, Slocum, Staude,
Amos, Klopper, Louw and Oosthuizen, 2004). Transformational leaders have such an influencial
personality and style of managing that they not only inspire their employees, co workers or
subordinated; but also, lead to the development of awe, admiration, delegation and
empowerment. Together all of these factors yield to more and increased levels of efforts,
commitment, and risk being put in by the employees on their part. And ultimately it is these
factors which lead to improved and better employee productivity and performance (Behling and
McFillen, 1996). On the other hand, there is a strong agreement over the fact that, for
organizations in order to be effective and successful needs effective leadership, and in case this is
not employed then the performance of the whole organization will be at risk and suffer (Maritz,
1995; Ristow, Amos and Staude, 1999).

Moreover, when we talk about teams or groups of people, the performance of the whole group is
largely affected by the kind of leadership the group or team has. As mentioned earlier, the more
the employees individual goals are satisfied the more they will put in their own effort and hence
the better performance will be not only of the individual but of the organization as a whole too
(Maritz, 1995; Ristow, et al., 1999).

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