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Journal of Organizational Management Studies

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Vol. 2014 (2014), Article ID 869927, 18 pages
DOI: 10.5171/2013.869927

Research Article
Testing Bass & Avolio Model of
Leadership in Understanding ERP
Implementation among Bruneian SMEs
Afzaal H. Seyal and Mohd Noah Abd. Rahman

Faculty of Business & Computing, Institute of Technology Brunei, Brunei

Correspondence should be addressed to: Afzaal H. Seyal; afzaal.seyal@itb.edu.bn

Received date: 28 April 2013; Accepted date: 3 July 2013; Published date: 28 January 2014

Academic Editor: Jessica Sze Yin HO

Copyright 2014. Afzaal H. Seyal and Mohd Noah Abd. Rahman. Distributed under Creative Commons
CC-BY 3.0

Abstract

The leadership style of Chief Executives Officers (CEO) in adoption and implementation of e-
business technologies especially within the context of small and medium enterprises (SMEs)
have received increasing acceptance in the recent years. This study investigates sixty CEOs
leadership style towards adoption of Enterprise Resource Planning (ERP) systems among
Bruneian SMEs. The study used the Multi-leadership Questionnaire (MLQ) from Bass and Avolio
(1995) to measure the leadership style. The results confirm that CEOs transformational
leadership (TRFL) style is significant towards adoption of ERP system. The results were
discussed and some recommendations were made for the further research.

Keywords: Transformational Leadership Style, Transactional Leadership Style, ERP, SMEs,

Brunei Darussalam

Introduction have been studied by researchers (Scupola,

Right from the early days of information
technology (IT) diffusion and adoption
research, the research has been profoundly
conducted to find out the factors that are
significant to adopting IT innovations. In this
concern, several of the organizational
(Iacovou et al., 1995 and Scupola, 2003),
environmental (Iacovou et al., 1995 and
Scupola, 2003) and technological factors
______________
2003 and Iacovou et al., 1995).
However, in recent years another variable
leadership style from the organizational
behaviour (OB) has been introduced in the
information systems (IS) research domain,
and has been a focus of researchers within
the context of SMEs (Waldman et al., 2001;
Ke and Wei, 2008). The focus has been
shifted from managers to the leader and
champions of innovation and with that a new

Cite this Article as: Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Testing Bass & Avolio Model of
Leadership in Understanding ERP Implementation among Bruneian SMEs", Journal of Organizational
Management Studies, Vol. 2014 (2014), Article ID 869927, DOI: 10.5171/2014. 869927
Journal of Organizational Management Studies
_____________________________________________________________________________
breed of leadership has emerged (Cope and
Waddell, 2001).
In classic studies, leadership behaviour is a
factor that has been found to be significant
determinant of organizational productivity
and change (Almaraz, 2009), organization
success (Harlow, 1998), organizational
climate (Lubbert, 1995), organizational
culture (Ogbonna and Harris, 2000). In this
concern we agree with the connotation made
by Ke and Wei, (2008) that organizational
culture can be consciously designed and
manipulated by leadership.
The IS literature suggests that a leaders
vision, attitude and behavior are critical for
employees perception of IT innovation and
thus its adoption outcomes (Purvis, et al.,
2001). In the context of ERP implementation,
leadership is consistently found to be the
most important factor leading to the success
of ERP implementation (Ke and Wei, 2008).
In this paper, the definition of SMEs is
adapted after Yap et al., (1992) where size of
greater than fifty employees to less than 250
employees is treated as medium
organization. The size of less than fifty
employees is treated as small organizations.
Similarly, in this study ERP covers the
following definition. ERP Systems have been
defined as comprehensive, packaged
software solution that integrate the complete
range of a business processes and functions
in order to present a holistic view of the
business from a single information and IT
architecture (Gable, 1998).
ERP as a type -3 IS innovation and has
strategic relevance for the firm because of its
integration with main or core business
processes they could lead to firms
performance and success at a later stage. It
has been found that the implementation of an
effective ERP system can bring both strategic
(Nah et al., 2007) and operational (Nicolaou,
2004) benefits to the organizations in todays
competitive business environments.
However, many organizations fail to reap the
potential benefits from the investment in
ERP project (Booth and Philip, 2005).
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
2
This paper is divided into four sections: The
next section presents the review of the
literature focusing on foundation of
leadership, and studies linking leadership
style with IT adoption in general and ERP in
particular. This is followed by research
design. The remainder of the paper presents
the analysis, a discussion of the results and
finally the paper concludes with the
limitations and practical implications of this
research.
Review of Literature
Foundations of Leadership Theories
Leadership is viewed as the particular act in
which a leader engages during the course of
directing and coordinating the work of his
group members (Fiedler, 1967). An early
work was started at the Ohio State University
by Stodgill (1981) to obtain descriptions of
leader behaviors that could be classified into
more general categories or classes of
behavior. The Ohio State University
leadership studies resulted in the leader
behavior description questionnaire
measuring two dimensions of leader
behavior. The first one is labelled as
'initiating structure and second one as
consideration structure. Stodgill (1981)
reported that both consideration and
initiating structures were found to be related
more to job satisfaction than to high
productivity.
Leadership Style
Shifting from various classical leadership
styles, traits and behaviors, researchers
began concentrating on finding other styles
of leadership. They are classified as the
transactional (TRXL) and transformational
(TRFL) approaches. Bass (1985) on the basis
of Burns (1978) ideas of transactional and
transformational political leaders was among
the first who made an attempt to deliberate
on the characteristics of TRFL. Bass and
Avolio (1995) developed an instrument, a
MLQ-multi-factor questionnaire, to capture
responses on both the TRXL and TRFL styles.
3 Journal of Organizational Management Studies
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According to Burns, (1978) TRXL leaders
motivate their followers by exchanging
rewards for the services rendered. Kuhnert
and Lewis, (1987) summarized TRXL leaders
as giving followers things they want in
exchange for things leaders want. Bass et al.,
(1996) describe TRXL leadership style as
being based on traditional bureaucratic
authority and legitimacy. Bass (1990)
describes the TRXL leaders relationship with
subordinates as having three phases: (1) He
recognizes what subordinates want to get
from their work and ensures that they get
what they want based upon their satisfactory
performance. (2) Rewards and promises of
rewards are exchanged for employees
efforts, and (3) the leader responds to his
employees immediate self-interest through
the completion of the work.
According to Yukl, (1998), transformational
(TRFL) leaders build commitment to the
organizations objectives and empower
followers to achieve those objectives. TRFL
approaches to leadership have long been
advocated as productive and evidence
suggests that TRFL practices do contribute to
the development of capacity and
commitment (Leithwood et al., 1999). In
another study, Sarros and Santora, (2001)
concluded that staff reports of leaders
behaviors in terms of three components of
TRFL: charisma, individualized consideration
and intellectual stimulation. A Leaders TRFL
style shows a positive correlation with
variables such as: job satisfaction, staff
turnover and professional achievement.
Studies examining the effects of TRXL and
TRFL number in the hundreds (Bass, 1998)
and continue today. Many of those have
found more positive outcomes related to
TRFL (Waldman et al., 2001). In their meta-
analysis, of research articles on leadership
style, approach and dimension in journal
single database from 1998 to 2011, Iqbal et
al., (2012) found that TRFL and TRXL were
widely studied in order to identify the best
possible way of leaders to interact with their
followers.
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
Organizational Adoption of IT and Leadership
Style
According to Fichman, (2004) Diffusion of
Innovation (DOI) (Rogers, 1995) serves as
the most widely cited theoretical framework,
although other theories such as Structuration
Theory (Walsham and Han, 1991) and
Network Theory (Walsham, 1997) have also
been used to explain IT adoption intentions
in organizational settings. Most of the studies
are further categorized by environmental
factors such as competitive pressure,
supplier pressure (Thong, 1999), size of the
business (Yap et al., 1992), and technological
factors such as perceived benefits (Iacovou et
al., 1995). Most recently, studies focused on
the strategic importance of EC (Drew, 2003),
and the organizational factor-impact of
perceived strategic value of EC by managers
of SMEs on the adoption decision of EC
(Grandon and Pearson, 2003, Seyal, 2009).
The studies are limited in the context of
CEO/CIO leadership style with the
technology adoption (Thite, 1999). However,
researchers have found the leadership style
and its relative importance in the IT function
in general (Onan and Gambil 2001). If we
consider the historical perspective, the early
work of Thong and Yap (1995) and Thong
(1999) has not only pointed out the relative
importance of organizational variables in the
adoption of technology, but also found the
significance of the owner/managerial
attribute towards IT innovations. It is
believed that CEO of the SMEs has a major
role in the business decision making and act
as catalyst to decide on the major IT
innovation and the major variable
investigated are CEOs' IT knowledge, prior
training, attitudes towards IT innovations
(Thong and Yap, 1995) and personality of the
CEOs (Harris, 1999). Thong (1999) in his
study found the CEO's IT knowledge and
innovativeness in IT adoption significant.
On the other hand empirical evidence
advocates that CEOs in SMEs are not IT
knowledgeable and this ignorance is further
treated as one of the barriers in IT adoption.
Cragg and King (1993) found that owner
managers/CEOs of SMEs lack IT knowledge
Journal of Organizational Management Studies
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and this also discourages other members in
the organizations from exploring further IT
opportunities. The studies by Thong and Yap
(1995) and Thong (1999) provide a
theoretical background for the later works on
the CEO's role in identifying new
technological opportunities. Therefore,
management support is crucial for IT
adoption (Thong and Yap, 1995, Chau, 2001
and Scupola, 2003). Iacovou et al., (1995)
further pointed out that role of CEO and top
management is a significant variable in
investing in IT and e-Commerce within the
context of SMEs. Sarros and Santora, (2001)
studied the leadership styles among
Australian businesses by using Bass and
Avolio (1995) multi-factor questionnaire and
found that most of the Australian Executives
exercise a mixed blend of both transactional
and transformational style of leadership.
However, in the past, some studies focused
on the leadership attributes of CEOs towards
the EC adoption. Lewin and Stephens (1994)
proposed an integrated model in which CEO
background, attitudes and demographics
(along with external and internal factors)
influences organizational innovativeness.
Feeny and Willcock, (1998) stressed on the
importance of leadership as a core IS
capability. They studied the Chief
Information Officers (CIO) leadership style
and found it to exploit IT resources. Onan
and Gambil (2001) conducted a survey and
concluded that leadership was the number
one desired trait in the CIO for large
companies.
Scupola (2003) explored the leadership
styles in e-Commerce adoption among
Australian SMEs and found that consultative
leadership was significant in e-Commerce
adoption. Similarly, Almaraz (2009) in his
study of effective change leadership styles
among SMEs found that visionary leadership
style was strongly linked with the
organizational change success. Seyal et al.,
(2012) in their pioneering Brunei-based
work studied 250 CEOs leadership style
towards adoption of EC within Bruneian
SMEs. They used Bolman & Deals leadership
frames to measure the leadership style and
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
4
found that paired leadership frames (human
and symbolic) were significant predictors of
EC adoption which further equate to the
TRFL style. Iyengar (2007) examined
leadership style in the light of the TRFL
theory and its impact on organizational level
variables such as CIO role effectiveness and
IT ambidexterity and individual level
variables such as Leader-Member Exchange
(LME) and the subordinate job satisfaction.
Results indicated that TRFL was the
strongest predictor of LME relationship that
in turn leads to job satisfaction. Khan et al.,
(2009) conducted a study among 296 top
executives from the telecommunication
sector in Pakistan and found that all facets of
TRFL are significant to organizational
innovation except idealized influences. In
another study by Imran et al., (2011) in
Pakistan, and concluded that TRFL style was
positively related with the innovative work
behavior. Chen et al., (2012) investigated the
relationship between TRFL with
technological innovations among 102
Taiwanese small business units. The results
indicate that transformational leadership
behaviours promote technological innovation
at strategic business units.
Leadership in the Context of ERP
Implementation
Although the literature is full of studies on
leadership style especially linking TRFL with
the e-business, as mentioned above and on
job satisfaction (Mihalcea, 2012), however,
limited studies are available on CEOs
leadership style on ERP adoption or
implementation. Bucker (2009) in his
document checklist for successful ERP
systems, wrote, Leadership is one of the
most critical factors in the successful
implementation of ERP. In our surveys over
the last nineteen years of working with and
interviewing high performance companies,
each of these companies had a senior
manager or CEO - a champion of new
business system implementation (Bucker,
Inc. www.bucker.com).
Willcock and Sykes (2000) found that
CEO/CIO should be visionary leaders in order
5 Journal of Organizational Management Studies
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to successfully implement ERP in the
organization. Chu (2003) studied the impacts
of TRFL leadership on the ERP project team
work quality and member satisfaction and
found that TRFL style had positive effect on
ERP team work quality and member
satisfaction. Huang (2010) examined the
impact of top managers on ERP
implementation. Result further confirmed
improvement in ERP system quality. Ke and
Wei (2008) examined as how leadership
affects ERP implementation by fostering the
desired organizational implementation
success. This was positively related with
organizational culture and leadership style,
and was conducive to ERP implementation.
Huang et al., (2011) studied 368 Taiwanese
companies by linking CEOs leadership style
on organizational performance through
successful ERP system. In conclusion, the
majority of the previous studies, either on
various IT features or confined especially to
ERP implementation as cited above have
linked and confirmed the TRFL with ERP
implementation. In fact, the instrument used
to measure the leadership style is composed
of both the TRXL and TRFL However, we are
of the strong opinion that if we design the
study based on the Bass and Avolio (1990)
instrument then we should include both the
TRFL and TRXL styles to avoid any bias. In
this respect, our work is unique as it
considers both important leadership styles
among CEOs in finding the suitability of the
more prevailing style that is deemed suitable
in measuring ERP implementation among
Bruneian SMEs.
Research Methodology
Design of Instrument
In the context of OB, there are two types of
instruments generally used to assess the
leadership attributes. One is the Bass and
Avolio, (1995) instrument and the second
one covering four frames of categorizing
leadership behaviours is the Bolman and
Deal (1997) instrument. However, in line
with the objective of the study, the
Multifactor Leadership Questionnaire (MLQ)
from Bass and Avolio was selected to conduct
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
the research. The original questionnaire is
45-items, on a 5-point Likert-type scale with
anchors labelled as 1 = not at all to 5 =
always. The MLQ is used to evaluate how
frequently, or to what degree, individuals
believe they engage in thirty-two specific
behaviors toward their subordinates. The
MLQ consists of twelve factors. Nine factors
are used to measure components of style,
while the other three factors are outcome
measures from the leadership style. Of the
nine leadership measures, five are
transformational factors and three are
transactional factors and one is a non-
transactional attribute. However, in this
study, we excluded the three outcomes
measures and retained seven attributes five
to measure transformational, and two for
measuring the transactional style. The one
outcome variable from transactional
attribute, and one non-transactional attribute
were taken from the construct because of
lowest corrected item total (>than .30). Table
1 provides the details. Although shorter
version of MLQ-X5 is available, but was not
used because of being very short and could
not contribute in study design. Part B of the
questionnaire captures the data about the
demographic profile covering organizational
characteristics, such as, age, gender, and
number of years of experience as CEO,
educational qualifications, type of ERP
system used and implementation details.
ERP Implementation: The definition and item
measuring dependent variable, ERP
implementation, was adapted and modified
by Venkatesh and Davis (2000) regarding
satisfaction of ERP output quality and items
measuring ERP success quality by Chung
(2007) on a five-point Likert scale starting
with 1 = strongly disagree to the 5 =
strongly agree. The construct output
quality includes the items that measure the
quality of ERP system output. Whereas, ERP
success/quality defines the items capture
responses on the degree of the quality of ERP
system and getting users satisfaction of ERP
systems with in fulfilling the businesss need.
Journal of Organizational Management Studies 6
_____________________________________________________________________________

Sample who were found to implemented ERP

Data for the study was collected in December
2012 by means of the questionnaire. The
questionnaire captured the respondents
demographic profile: gender, age, and
experience as CEO or owner of the business,
type of business, commencement of business,
technology infrastructure, and type of web
used by the business, number of employees
and up to what extent business has
implemented ERP. The behavior perceptual
items were measured on a five-point scale
representing a range from Never to
Frequently if not always. As for the
Leadership style perceptual items were
measured from Least to Best. Every effort
was made to ensure an effective response
rate; with the use of phone calls, covering
letters and responsive questionnaires. A
random sample of 100 small and medium
enterprises was compiled from a key
business directory of Brunei (Goldpages,
2011). The sampling plan is based on
purposive sampling techniques. This
technique is selected based on the knowledge
of population (SMEs who have implemented
ERP), and the purpose of the study (Czaja
and Blair, 1995). A questionnaire survey was
conducted on CEOs/owners/managers in
100 small and medium enterprises those
systems, however, a total of seventy valid
responses were obtained who said that they
have implemented an ERP system. For
further scrutiny, it was revealed that ten out
of seventy SMEs are at an initial stage of ERP
adoption so we excluded them from our valid
sample listing. Sixty responses were,
however, further used on the basis of a
judgemental sampling technique to enhance
representativeness.
Instrument Reliability and Validity
Several techniques were used to assess the
reliability and to assess the face, construct
and convergent validity of the instrument.
Cronbach (1951) alpha () was used to
assess the reliability. In order to ascertain
face validity, an initial questionnaire, after
routine editing, was given to a panel of
experts (Academics, HR practitioners and
business leaders). They were asked to assess
the questionnaire and very few comments, in
fact, were received and only some minor
changes were required to enhance the clarity.
Table 3 shows the reliability coefficients and
convergent validity for the various
constructs.

Table 1: Pearson Correlations and AVE Table for Discriminant Validity

IB IM IS IC CR MBE
Idealized Behavior (IB) 0.80
Inspirational Motivation (IM) .764 0.60
Intellectual Stimulant (IS) .589 .535 0.5
3
Individualized Consideration .735 .716 .779 0.5
(IC) 6
Contingent Reward (CR) .777 .704 .613 .692 0.54
Management by Exception .756 .667 .473 .624 .646 0.58
(MBE) Active
All correlations are significant at the 0.01 level (2-tailed) except with * not significant at p>.01.
Diagonal represents average variance extracted in bold

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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
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Campbell and Fiske (1959) propose two
types of validity: convergent and
discriminating validity. Convergent validity is
measured by an average variance extracted
for each construct during the reliability
analysis that should be 0.5 (50%) or better
(Igbaria and Iivari 1995). Tables 1 and 2
show the reliability values for the various
constructs with variance extracted in
diagonal. After filtering and to further
analyse for convergent and discriminating
validity of these six constructs, the principal
component method with varimax rotation
was used to assess the variance explained. In
general results show that both validities are
satisfied. The result for discriminant validity
is provided in Table 2.

Table 2: Reliability & Validity Analysis

Constructs No of No of items Alpha value Mean Variance

original retained (.60 and explained
items above) <.50
Idealized Attribute 4 3 (construct
removed)
Idealized Behaviour 4 3 .78 3.02 .56
Inspirational Motivation 4 4 .81 2.92 .63
Intellectual Stimulant 4 3 .70 2.93 .51
Individualized 4 2 .75 3.29 .68
Consideration
Transformational style 3.04
Contingent Reward 4 4 .71 2.93 .57
Management by Exception 4 3 .73 2.88 .58
Transactional style 2.90
Total 28 22

Results fully agreed. However, for the measuring of

Data obtained from the survey were analysed
using descriptive statistics, factor analysis as
well as correlation analysis by using SPSS
version 19.
leadership style only six out of nine constructs
were used. After the analysis it was found that
86% of the respondents have TRFL style with
a mean of 3.04 compared with a mean of 2.90
for TRXL among the CEOs of SMEs.

Background Profile In line with the principles of multivariate data

The background data of individual CEOs
consists of a majority, (59%) are males within
the age group of 36-40 years and possesses 6-
10 years of experience. The majority of the
respondents are from wholesale/retail
business sector with a total number of
employees ranging from10-50.
analysis, we conducted a zero-order
correlation between the various leadership
constructs as shown in Table 1. The
correlation provides directional support for
the predicted relationship and shows that
collinearity among all the independent
variables is moderate so as not to affect the
regression analysis.

The respondents were asked to assess their Regression Analysis

responses on all twenty-two items pertaining
to the various leadership attributes on five The relationship between the CEOs leadership
point Likert scale; 1= not at all agree to 5=for style and ERP implementation was

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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
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investigated by conducting regression
analysis. Prior to the testing for regression
analysis, we conducted a zero order
correlation between the constructs as shown
in Table 1. Multi-collinearity was examined by
analysing each independent variables
variance inflation factor (VIF). Multi-
collinearity problem did not appear to exist as
VIF value of each variable was much less than
10 (Hair et al., 1998). Normality of the data
was confirmed by taking out the outliers by
using SPSS procedure Mahalanobis distance
Table 3: Hierarchical Regression Analysis for Leadership Style
Variables Beta
Idealized behavior -.065
Inspirational motivation .382
Intellectual stimulation -.285
Individual consideration .413
Contingent reward .089
Management by exception 0.09
Dependent variable: ERP Implementation, R2 = 34%, F= 6.23-statistically significant
Discussion
At the outset, the present study analyses the
suitability of MLQ for the local environment.
The original instruments measure 45-items
grouped into twelve various attributes of
three broad categories of leadership style:
transformational, transactional and laissez-
faire. Surprisingly, twenty-two items on two
constructs were found applicable to the CEOs
of Bruneian SMEs. For the purpose of the
study we have excluded the laissez-faire style
the least one used. The first construct,
Idealized Attribute covering four items on
leaders attribute displaying sense of power
and confidence and instilling pride in others
has to be dropped from the study due to the
lowest corrected total-item correlation and
variance, indicating the non-suitability of this
construct to the CEOs.
The second construct that was dropped from
this study is Passive Management-by-
Exception, indicating the use of punishment
and other measures to correct deviations from
expected performance, is also not applicable
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
8
and through examination of residual scatter
plots. The result of regression analysis is
presented in Table 3 as below. The model has
statistically significant F-ratio and possesses
moderate explanatory power as indicated by
R2 coefficient that shows that 34% of the
variance in ERP implementation is explained
by these six independent variables. From
Table 3, it is further evident that two out of
four components of transformation leadership
such as inspirational motivation and
individual consideration are significant
predictors of ERP implementation.
t-statistic p-value Remarks
-.415 .681
2.94 0.04* Significant
-1.736 .090
6.27 0.01* Significant
.493 .625
1.35 0.08
to the CEOs. It may be due to the reason that
this study covers the non-government SMEs
and local businesses are not functioning under
a bureaucratic environment and therefore, a
more collective and team-work operational
environment prevails in the industry. In
assessing the leadership style, the study
revealed, after the analysis of the data that
CEOs exhibit a multiple leadership style: a
combination of both TRXL and TRFL.
However, a majority of 86% of the
respondents scored higher on TRFL
leadership with a mean of 3.04 than the TRXL
style which scored a mean of 2.90 on the scale
of 1 to 5. There exists a significant statistical
difference in the mean of these two types (t= -
2.65, p<.05) indicating the dominance of
TRFL.
The study results has confirmed that two
dimensions of TRFL style i.e., individualized
consideration and inspirational motivation
are significant predictors of ERP
implementation within the context of
 9 Journal of Organizational Management Studies
_____________________________________________________________________________
Bruneian SMEs. Individualized consideration
deals with the fundamental leadership
behaviour of treating individuals as important
contributors to the workplace. Leaders who
use this style of leadership show
consideration for their workers needs and are
prepared to encourage and coach them to
achieve organizational objectives.
In summary, the key indicators include
encouragement, caring for and coaching of
individuals. Therefore, leaders using the
individual consideration style can reap the
benefits from ERP implementation as ERP
success in fact, helps management to
capitalize on the organizational benefits
especially enhancing productivity. It is further
noted that CEOs support and clear vision have
a critical impact on the ERP implementation
process (Huang, 2010). The findings support
Huang (2010) and Yukl (1998) who suggested
that employees would be more satisfied with
leaders who are both considerate and
supportive than with leaders who are either
indifferent or hostile towards subordinates.
The second important TRFL style that
emerged from this study is inspirational
motivation leadership behavior. The leader,
who use this leadership behavior set high
standards, communicate their ideas and vision
to their workers in a clear way and encourage
workers to develop beyond the routine
practice in such a manner that both the
workers and the organization grow and
develop together. In summary, key indicators
for inspirational motivation are organizational
vision, providing challenges for workers,
encouragement and giving workers autonomy.
They use emotions to motivate the staff. This
ability could inspire team members and
indirectly affects members satisfaction with
the leader.
Our findings are contrary to Chu (2003) who
found that charismatic and intellectual
stimulation behaviour of leaders who engage
with ERP implementation influence team
members satisfaction with their leaders. This
might be due to the fact that his study
included ERP project leaders instead of CEOs
as the sampling frame. The role of the project
leader, however, is limited for the life cycle of
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
the ERP project. The CEOs role, on the
contrary, is symbolic for the overall
functioning of the SMEs. Our findings partially
support Iyengar (2007) who found that all the
attributes of TRFL are significant for
organizational innovation except
individualized consideration and idealized
influences. Results support Khan et al., (2009),
and Imran et al., (2011) findings that all TRFL
attributes are significant for organizational
innovation.
In general, although we did not measure
organizational culture, we partially agree with
Ke and Wei (2008) who asserted that
organizational culture is conducive to ERP
implementation which is trigged by ERP top
managements direct effect on leadership.
They asserted that TRFL behaviour is more
effective in the technology adoption phase
while TRXL is more effective in
implementation phase and mixed leadership
style is more effective for assimilation and
extension phase. This might be true for a
larger economy like China where the research
is basically conducted. Secondly, the focus of
the main business is large organizations and
not the SMEs. Thirdly, their study provided a
framework and no empirical evidence could
further validate the framework. In the
presence of these three assertions it is difficult
to get support within our environments. Our
work otherwise concluded that TRFL style is
more suitable for ERP implementation among
Bruneian SMEs.
The plausible reason for this finding might be
found within the roots of Bruneian national
culture. The functioning of Bruneian SMEs is
normally controlled by their CEOs and
because of relatively smaller size and other
inherited technical, economical and
operational impediments, the relationship
between the CEOs and other operational and
administrative staffs is direct. Secondly,
although not measured directly, the national
culture, we agree with Hofstede (1980), that
the Bruneian culture is dominated by power
distance and collectivism rather than
individualism. So, CEO transformational
abilities have more potential with ERP
 Journal of Organizational Management Studies
_____________________________________________________________________________
technology implementation which is more of a
teamwork process.
Conclusion
The study has fulfilled its objectives and some
interesting findings emerged regarding the
leadership style of CEOs among Bruneian
SMEs. Although a statistically significant
difference exists in both transformational and
transactional types of leadership, more CEOs
practise the TRFL style. However, the high
mean score gives some indication that TRFL
style is practised more frequently. Previous
researchers suggested that transformational
leaders are associated with technology
adoption, implementation organizational
change and innovation. This is also true for
the ERP implementation process within SMEs.
As TRFL is based upon personal values and
beliefs of the leaders, it therefore leads to a
strong desire to adopt IT at all levels of the
organization where it could provide
competitive advantages.
In the context of Bruneian SMEs, TRFL should
be blended with the TRXL so as to introduce
business practices in a somewhat rigid way
for the employees using the new ICT features.
However, the TRFL should inspire the CEOs to
believe in themselves through the process of
strategic planning of the business setting and
to adopt various IT/IS features to implement
the vision and share in equally the use of new
ICT tools in restructuring business processes
at each stage of technology integration. As
with ubiquitous and pervasive computing, a
new wave of technology will replace the
traditional brick-and-mortar business
practices to a brick-and-click approach to the
total virtual environments. In order to cope
with drastic changes with the business
process reengineering (BPR) for the SMEs to
prepare for new challenges there needs to be
an extensive retraining of these CEOs to
accept the changing role of leadership. This
process of change both in TRFL and TRXL
styles will ensure an everlasting change
through effective implementation.
By examining the effects of leadership style at
the organizational level, our results have
served to develop a comprehensive
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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927
10
understanding of leadership style especially in
deploying IT/ICT resources. It also provides
useful insights to researchers and
practitioners and they can use this study as a
step forward for further refining their future
endeavours.
Limitations: The study is not free from its
weaknesses. The small sample size itself is not
very rewarding and it is mostly because of the
reason that ERP is very new and expensive
technological advancement and majority of
the SMEs are not yet ready to adopt it.
Secondly, all data on leadership behavior for
this study came from a self-report survey
conducted in all the SMEs only in one district
at a single point in time. It is possible that
common method variance influences the
results and that data collected on different
times or through different methodologies
could produce different results.
Recommendations: The study has brought the
evidence of TRFL leadership style that
prevails among CEOs of the Bruneian SMEs
and is directional in nature. Therefore,
precautions should be taken while
generalizing the results. The study supports
the previous researches to some extent on the
relevancy of TRFL leadership style, but we
cannot recommend that only CEOs with TRFL
leadership should be selected. Since, this is the
first study of its kind conducted in Brunei with
small sample size, the future endeavours with
more sample size could brings some
significant results and especially longitudinal
studies with other ASEAN countries especially
in Singapore and Malaysia could further add
to knowledge.
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15 Journal of Organizational Management Studies
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Questionnaire

Part A: Demographics

1. Gender:

Male Female

2. Age group:

Below 25 36 40
26 30 41 45
31 35 46 - 50
Above 51

3. Educational Level

A-Level/ND HND
Professional qualification First degree
Masters and above

4. Job title

CEO/ President COO (Chief Operating Officer)

Director General Manager
Senior executives

5. Total no of employees

Less than 10 10-50

51-100 Above 100

6. No of years of experience in the business

Less than year One to five year

Six to 10 years More than 10 years

7. Your Main Business Area (Type of Business):

Wholesale/retail Banks/insurance
Hotel/Food & Catering Travel/shipping/movers
Printing/publishing Construction
General marketing Services-based (such as IT, legal,
health)

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_____________________________________________________________________________

8. Up to what extent your business is using ERP? 1 2 3 4 5

9. What types of ERP technologies you have in your organization?

Microsoft SAP R/3

Oracle E-business EPICOR
Oracle People Soft ERP (in-house)
SAP business one

10. Types of applications using ERP

Customer enquiry /CRM Sales/Marketing including Budgeting

Order entry Business planning
Order tracking and Billing Human resources

11. What is your current level of satisfaction with the ERP technology adoption?

Very much satisfied Satisfied to some extent

Not sure or average Dissatisfied to some extent
Absolutely dissatisfied

Part B: Leadership Style

Use the following rating scale:

0 1 2 3 4
Not at all Once in a while sometimes fairly often frequently if not always

Directions: This questionnaire is adapted after Bass and Avolio and designed to help you describe
your leadership style as you perceive it. Please answer all items on the questionnaire by circling the
appropriate response on the rating scale from 0 to 4 the format is given below. The word others
in question may mean your peers, clients, direct reports staff, and/or all of these individuals. If an
item is irrelevant, or if you are unsure or do not know the answer leave the answer blank.

1. I provide others with assistance in exchange for their efforts

2. I re-examine critical assumptions to questions whether they are appropriate
3. I fail to interfere until problems become serious
4. I focus attention on irregularities, mistakes, exceptions and deviations
5. I avoid getting involved when important issues arise
6. I talk about my most important values and beliefs
7. I am absent when needed
8. I seek differing perspectives when solving problems
9. I talk optimistically about the future
10. I instill pride in others for being associated with me

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17 Journal of Organizational Management Studies
_____________________________________________________________________________

11. I discuss in specific terms who is responsible for achieving performance targets
12. I wait for things to go wrong before taken action
13. I talk enthusiastically about what needs to be accomplished
14. I specify the importance of having a strong sense of purpose
15. I spend time teaching and coaching
16. I make clear what one can expect to receive when performance
goals are achieved
17. I show that I am a firm believer in If it isnt broke, dont fix it
18. I go beyond self-interest for the good of the group
19. I treat others as individuals rather than just as a member of a group
20. I demonstrate that problems must become chronic before I take action
21. I act in ways that build others respect for me
22. I concentrate my full intention on dealing with mistakes, complaints,
and failures
23. I consider the moral and ethical consequences of decisions
24. I keep tracks of all mistakes
25. I display a sense of power and confidence
26. I articulate a compelling version of the future
27. I direct my attention toward failures to meet standards
28. I avoid making decisions
29. I consider an individual as having different needs, abilities,
and aspirations from others
30. I get others to look at problems from many different angles
31. I help others to develop their strengths
32. I suggest new ways of looking at how to complete assignments
33. I delay responding to urgent questions
34. I emphasize the importance of having a collective sense of mission
35. I express satisfaction when others meet expectations
36. I express confidence that goals will be achieved
37. I am effective in meeting others job-related needs
38. I use methods of leadership that are satisfying
39. I get others to do more than they expected to do
40. I am effective in representing others to higher authority
41. I work with others in a satisfactory way
42. I heighten others desire to succeed
43. I am effective in meeting organizational requirements
44. I increase others willingness to try harder
45. I lead a group that is effective

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Afzaal H. Seyal and Mohd Noah Abd. Rahman (2014), Journal of Organizational Management Studies,
DOI: 10.5171/2014. 869927