PERCEIVED LEADERSHIP STYLES AND ITS IMPACT ON ORGANIZATIONAL COMMITMENT A Thesis Submitted to

Ganpat University

For the award of degree of

Doctor of Philosophy (Management)

Submitted by

BADSHAH SHITAL BHARATKUMAR Registration No: MM/002/010/2008

Under the Guidance of

Dr. DM Pestonjee, Ex-IIM Professor (Guide)

Dr. MS Sharma, Dean-Management, Ganpat University (Co-Guide)

April 2011

EXECUTIVE SUMMARY Leadership is one of the most favorite topics among psychologists, sociologists, political scientists, and certainly management scientists. There is a still growing interest in leadership, which has been defined in different ways. Leadership is a universal component of human condition. It is a process by which and through which groups, organizations and societies seek to achieve their perceived needs and objectives. Napoleon expressed his feelings about the importance of leadership in his quip that he would rather have an army of rabbits led by a lion than an army of lions led by a rabbit. It is the leaders who make the difference in their subordinates‘ satisfaction and performance. Leaders also make the difference in whether their organizations succeed or fail. Over the last 50 years, leadership has been examined in terms of enduring traits, sets of behaviors or styles, situational properties, and presumed cognitive processes. Despite numerous theories and volumes of research, little cumulative knowledge has been gained. Various camps are concerned with important but entirely difficult aspects of leadership. Each camp, however, represents the dimension of leadership with which it is preoccupied as a complete leadership theory. Many of researchers by adding little to leadership research, for the most part, fail to embrace the complexity and the paradox inherent in human deliberation and action. With such complexity already present in the subject, rather than adding vague information to the existing work, the researcher has narrowed down its approach for the research work. This study sought to examine the relationships of perceived leadership style with subordinate organizational commitment, extra effort, effectiveness and satisfaction. The researcher tried to study the relationship for different samples, and explored for similarities or differences among their relationships with each others. The researcher studied the leadership styles of branch managers of State Bank of India, companies in

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insurance sector, and directors of business schools in Gujarat. Those leaders who have completed at least one year with their position in their respective organization were considered for our study. He collected responses from their subordinates who have worked under these leaders for at least one year. This study can be helpful to decision makers, who plan to develop leaders within organization. More importantly, this study highlights leadership factors, and their relationship with subordinate outcome. Not all the leadership factors may be of organizational interest at any particular time. It becomes imperative for decision makers to identify those leadership factors which can be of much help for leaders to generate specific results for organization.

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CERTIFICATE OF SUPERVISOR

This is to certify that this thesis titled ―Perceived Leadership Styles and its Impact on Organizational Commitment‖ submitted by Badshah Shital Bharatkumar at Department of Management, Ganpat University, Kherva, Mehsana is the bona fide work completed under our supervision and guidance for fulfillment of the requirement for the award of the degree of Doctor of Philosophy (Ph.D.) in Management.

Date: Place: Ganpat University, Mehsana

Dr. DM Pestonjee

Dr. Mahendra Sharma

(Guide)

(Co-guide)

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DECLARATION BY THE CANDIDATE

The thesis titled ―Perceived Leadership Styles and its Impact on Organizational Commitment‖ is submitted in fulfillment of the requirements for the award of the degree of Doctor of Philosophy (Ph.D.) in Management to Ganpat University, Kherva, Mehsana. I declare that this thesis is based on my original work except for quotations and citations which have been duly acknowledged. I also declare that this thesis has not been previously or concurrently submitted, either in whole or in part, for any other qualification to Ganpat University or any other institution.

Date: Place: Ganpat University, Mehsana.

Badshah Shital Bharatkumar

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ACKNOWLEDGMENTS The span of thesis writing does not start and end with the subject selection and submission for evaluation. It takes months of preparation with collective efforts and supports by many, directly or indirectly, Therefore, I would like to acknowledge those individuals whom have helped me grow academically, professionally, and personally that I was able to write this thesis with much confidence in my heart. First of all, I shall thank the Almighty God, for providing me this opportunity of higher studies. Thank you for the gift of optimism, knowledge, wisdom, and courage throughout the work. Thank you for sharing all these wonderful people with me and for showing me your love and care through them; the people whom have contributed to the success of this thesis and to my personal growth as well. I want to thank both my guides Dr. DM Pestonjee and Dr. Mahendra Sharma for their unwavering support and confidence for this research work. Thank you for every reminder, for every consultation you have considered for me, for never doubting my capability to finish every portion of my work, and for the ideas you have suggested for the better outcome of this thesis. Without you, none of this would have been possible. A sincere, disciplined and frank approach by Dr. Pestonjee has helped me to finish my work on time. His academic experience, complemented by paternal approach, has always been useful in carrying out my work with honest approach. I also want to thank Dr. Mahendra Sharma for becoming my mentor since I have stepped into our department. I want to thank him for the kind of love, understanding, and support that I have received since the beginning of my journey and growth as an academician at V.M. Patel Institute of Management. An endless gratitude goes to my family for their patience and understanding while I was progressing with this research work. As we don‘t have tradition to thank our parents, I certainly shall make a point to express my humble gratefulness towards them. I shall thank my brother and sister-in-law for their undaunted love and appreciation. I own the

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great responsibilities toward my daughter and nephew who all the time help me turn to laughter whenever I would encounter disappointment in the course of my work. A special ―thank you‖ must be given to a friend whom I have known as Arpita for all her help, understanding, and concern throughout my work. Thank you for your patience and for accepting wholeheartedly the consequences of my choices in the past years. Without your presence, I would have never finished this work with much enjoyment and certitude about my life. At the end, I am thankful to all those countless people who have been generous with their time, support, and encouragement during my work.

Badshah Shital Bharatkumar

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TABLE OF CONTENTS

EXECUTIVE SUMMARY

ii

CERTIFICATE OF SUPERVISOR

iv

DECLARATION BY THE CANDIDATE

v

ACKNOWLEDGMENTS

vi

LIST OF TABLES

xii

LIST OF FIGURES

xvi

LIST OF EQUATIONS

xvii

ABBREVIATIONS

xx

CHAPTER 1: INTRODUCTION

1

1.1 Importance of the Study

1

1.2 Challenges for Leaders

5

1.3 Outline of the Thesis

7

CHAPTER 2: REVIEW OF LITERATURE

9

2.1 Introduction

9

2.2 Defining Leadership

12

2.3 Trait Theory of Leadership

16

2.4 Behavioral Theory of Leadership

18

2.5 Fiedler‘s Contingency Theory of Leadership

20

2.6 Path-Goal Theory of Leadership

22

2.7 Vroom Theory of Decision Making

24

2.8 Managerial Grid

25

2.9 Transactional Leadership

27

2.10 Leader-Member Exchange Theory of Leadership

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2.11 Transformational Leadership

30

2.12 Charismatic Leadership

33

2.13 Power and Leadership

34

2.14 Servant Leadership

35

2.15 Organizational Leadership

36

2.16 Organizational Commitment

39

2.17 Research Gap in the Area of Leadership

40

CHAPTER 3: RESEARCH METHODOLOGY

47

3.1 Introduction

47

3.2 Objectives of the Study

47

3.3 Hypotheses of the Study

48

3.4 Research Design and Sampling

49

3.5 Scope of Study

50

3.6 Measuring Instruments

51

3.6.1 Multifactor Leadership Questionnaire – Form 5X

51

3.6.2 Validity & Reliability of Multifactor Leadership Questionnaire – Form 5X

57

3.6.3 Organizational Commitment Questionnaire

57

3.7 Limitation of Proposed Study

58

3.8 Data Collection Procedure

58

3.9 Summary

59

CHAPTER 4: ANALYSIS OF DATA

60

4.1 Introduction

60

4.2 Step 1: For 56 Leaders & 379 Subordinates

64

4.2.1 Correlation Analysis for I.V. (Level 1) with Dependent Variables

64

4.2.2 Correlation Analysis for I.V. (Level 2) with Dependent Variables

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4.3 Step 2: For Each Sample Representation Independently

83

4.3.1 Correlation Analysis for I.V. (Level 1) with Dependent Variable

83

4.3.2 Correlation Analysis for I.V. (Level 2) with Dependent Variable

114

4.4 Step 3: Comparative Analysis for Independent Variables between Three Samples (Bank, Insurance, B-School)

149

4.5 Step 4: Comparative Analysis for Dependent Variables between Three Samples (Bank, Insurance, B-School)

151

4.6 Step 5: Comparative Analysis for Independent Variables (Level 1) between Four Sample Representation of Insurance Companies

153

4.7 Step 6: Comparative Analysis for Dependent Variables between Four Sample Representation of Insurance Companies

155

CHAPTER 5: DISCUSSION AND CONCLUSIONS

157

5.1 Introduction

157

5.2 Leadership Styles and Subordinate Outcomes

157

5.3 Leadership Factors and Subordinate Outcomes

159

5.4 Leadership Styles across Samples

161

5.5 Subordinate Outcomes across Samples

161

5.6 Managerial Implications

162

5.7 Conclusion

162

CHAPTER 6: RECOMMENDATION FOR FURTHER RESEARCH

166

REFERENCES

167

ANNEXURE 1: SURVEY INSTRUMENTS

182

Multifactor Leadership Questionnaire

182

Organizational Commitment Questionnaire

185

Leader‘s Inventory Questionnaire

186

ANNEXURE 2: PERMISSION LETTER

187 x

ANNEXURE 3: LEADERSHIP – A PRACTICAL UNDERSTANDING

188

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LIST OF TABLES

TABLE 1 SAMPLE REPRESENTATION .................................................................... 60 TABLE 2 DEMOGRAPHIC REPRESENTATION OF SAMPLE ................................. 61 TABLE 3 INDEPENDENT VARIABLES & DEPENDENT VARIABLES: ................. 62 TABLE 4 SIX STEP ANALYSIS.................................................................................. 63 TABLE 5 DESCRIPTIVE STATISTICS FOR LEADERSHIP STYLES ....................... 64 TABLE 6 PEARSON CORRELATION FOR LEADERSHIP STYLES WITH DEPENDENT VARIABLES ................................................................................. 65 TABLE 7 MULTIPLE REGRESSION FOR LEADERSHIP STYLES & SUBORDINATE EXTRA EFFORT ...................................................................... 66 TABLE 8 MULTIPLE REGRESSION FOR LEADERSHIP STYLES &SUBORDINATE EFFECTIVENESS ................................................................. 68 TABLE 9 MULTIPLE REGRESSION FOR LEADERSHIP STYLES & SUBORDINATE SATISFACTION ....................................................................... 70 TABLE 10 MULTIPLE REGRESSION FOR LEADERSHIP STYLES & SUBORDINATE ORGANIZATIONAL COMMITMENT .................................... 72 TABLE 11 PEARSON CORRELATION BETWEEN LEADERSHIP FACTORS AND DEPENDENT VARIABLES ................................................................................. 74 TABLE 12 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE EXTRA EFFORT ...................................................................... 75 TABLE 13 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE EFFECTIVENESS .................................................................... 77 TABLE 14 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE SATISFACTION ....................................................................... 79 TABLE 15 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE ORGANIZATIONAL COMMITMENT .................................... 81 TABLE 16 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EXTRA EFFORT (SBI)............................................................. 84

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TABLE 17 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EFFECTIVENESS (SBI) ........................................................... 86 TABLE 18 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE SATISFACTION (SBI) ............................................................. 88 TABLE 19 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (SBI)........................... 90 TABLE 20 DESCRIPTIVE STATISTICS FOR LEADERSHIP STYLE (INSURANCE) .............................................................................................................................. 91 TABLE 21 PEARSON CORRELATION - LEADERSHIP STYLE (INSURANCE) ..... 92 TABLE 22 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EXTRA EFFORT (INSURANCE COMPANIES) ..................... 93 TABLE 23 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EFFECTIVENESS (INSURANCE COMPANIES) .................... 95 TABLE 24 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE SATISFACTION (INSURANCE COMPANIES) ...................... 97 TABLE 25 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (INSURANCE COMPANIES) ....................................................................................................... 99 TABLE 26 DESCRIPTIVE STATISTICS FOR LEADERSHIP STYLE (MANAGEMENT SCHOOLS) ........................................................................... 101 TABLE 27 PEARSON CORRELATION - LEADERSHIP STYLE (MANAGEMENT SCHOOL)............................................................................................................ 101 TABLE 28 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EXTRA EFFORT (B-SCHOOL DIRECTORS) ....................... 102 TABLE 29 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EFFECTIVENESS (B-SCHOOL DIRECTORS) ..................... 104 TABLE 30 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE SATISFACTION (B-SCHOOL DIRECTORS) ........................ 106 TABLE 31 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (B-SCHOOL DIRECTORS)...................................................................................................... 108 xiii

TABLE 32 CORRELATION AND SIGNIFICANCE OF LAISSEZ-FAIRE LEADERSHIP STYLE WITH DEPENDENT VARIABLES ............................... 110 TABLE 33 CORRELATION AND SIGNIFICANCE OF TRANSACTIONAL LEADERSHIP STYLE WITH DEPENDENT VARIABLES ............................... 111 TABLE 34 CORRELATION AND SIGNIFICANCE OF TRANSFORMATIONAL LEADERSHIP STYLE WITH DEPENDENT VARIABLES ............................... 113 TABLE 35 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT (SBI)........................................................... 115 TABLE 36 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS (SBI) ......................................................... 117 TABLE 37 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION (SBI) ........................................................... 119 TABLE 38 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (SBI)......................... 121 TABLE 39 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT (INSURANCE COMPANIES) ................... 124 TABLE 40 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS (INSURANCE COMPANIES) .................. 126 TABLE 41 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION (INSURANCE COMPANIES) .................... 128 TABLE 42 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (INSURANCE COMPANIES) ..................................................................................................... 130 TABLE 43 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT (B-SCHOOL DIRECTORS) ....................... 133 TABLE 44 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS (B-SCHOOL DIRECTORS) ..................... 135 TABLE 45 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION (B-SCHOOL DIRECTORS) ........................ 137

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TABLE 46 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (B-SCHOOL DIRECTORS)...................................................................................................... 139 TABLE 47 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT ......................................................... 141 TABLE 48 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS ....................................................... 143 TABLE 49 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION .......................................................... 145 TABLE 50 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT ....................... 147 TABLE 51 COMPARATIVE ANALYSIS FOR INDEPENDENT VARIABLES FOR THREE SAMPLES USING ANOVA .................................................................. 149 TABLE 52 COMPARATIVE ANALYSIS FOR DEPENDENT VARIABLES FOR THREE SAMPLES USING ANOVA .................................................................. 151 TABLE 53 COMPARATIVE ANALYSIS FOR LEADERSHIP STYLES INSURANCE COMPANIES USING ANOVA .......................................................................... 153 TABLE 54 COMPARATIVE ANALYSIS FOR DEPENDENT VARIABLES FOR INSURANCE COMPANIES USING ANOVA ................................................... 155

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LIST OF FIGURES FIGURE 1 EVOLUTIONARY STAGES OF LEADERSHIP THEORY ....................... 11 FIGURE 2 THE EVOLUTIONARY TREE OF LEADERSHIP THEORY .................... 15 FIGURE 3 LEADERSHIP TRAITS AND CHARACTERISTICS ................................. 17 FIGURE 4 BEHAVIORAL THEORY OF LEADERSHIP ............................................ 19 FIGURE 5 FIEDLER‘S CONTINGENCY MODEL OF LEADERSHIP ....................... 21 FIGURE 6 PATH-GOAL THEORY OF LEADERSHIP ............................................... 23 FIGURE 7 MANAGERIAL GRID ................................................................................ 26 FIGURE 8 TRANSACTIONAL LEADERSHIP ........................................................... 27 FIGURE 9 TRANSFORMATIONAL LEADERSHIP ................................................... 31 FIGURE 10 CHARISMATIC LEADERSHIP ............................................................... 33

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LIST OF EQUATIONS EQUATION 1 EE = 0.715 + 0.002 LFL + 0.237 TRANSACTIONAL + 0.580 TRANSFORMATIONAL ...................................................................................... 66 EQUATION 2 EFF = 0.952 – 0.103 LFL + 0.019 TRANSACTIONAL + 0.708 TRANSFORMATIONAL ...................................................................................... 68 EQUATION 3 SAT = 0.837 – 0.217 LFL + 0.156 TRANSACTIONAL + 0.763 TRANSFORMATIONAL ...................................................................................... 70 EQUATION 4 OC = 37.054 – 1.809 LFL + 0.001 TRANSACTIONAL + 4.235 TRANSFORMATIONAL ...................................................................................... 72 EQUATION 5 EE = 1.152 + 0.065 IIA – 0.180 IIB + 0.287 IM + 0.185 IS + 0.059 IC + 0.131 CR + 0.055 MBEA + 0.077 MBEP – 0.068 LFL .......................................... 75 EQUATION 6 EFF = 1.108 + 0.082 IIA – 0.119 IIB + 0.249 IM + 0.174 IS + 0.222 IC + 0.121 CR + 0.014 MBEA - 0.238 MBEP + 0.031 LFL ........................................... 77 EQUATION 7 SAT = 0.870 + 0.029 IIA + 0.133 IIB + 0.172 IM + 0.290 IS + 0.160 IC + 0.090 CR - 0.066 MBEA + 0.132 MBEP – 0.282 LFL ........................................... 79 EQUATION 8 OC = 39.676 + 1.090 IIA – 0.040 IIB + 1.661 IM + 0.149 IS - 1.520 IC + 1.525 CR + 1.381 MBEA - 2.511 MBEP – 0.537 LFL ........................................... 81 EQUATION 9 EE = 0.686 – 0.034 LFL – 0.081 TRANSACTIONAL + 0.879 TRANSFORMASTIONAL ................................................................................... 84 EQUATION 10 EFF =0.993 – 0.213 LFL + 0.204 TRANSACTIONAL + 0.599 TRANSFORMASTIONAL ................................................................................... 86 EQUATION 11 SAT = 1.031 – 0.167 LFL + 0.063 TRANSACTIONAL + 0.783 TRANSFORMASTIONAL ................................................................................... 88 EQUATION 12 OC = 42.996 – 1.176 LFL – 1.525TRANSACTIONAL + 3.610 TRANSFORMASTIONAL ................................................................................... 90 EQUATION 13 EE = 1.132 – 0.051 LFL + 0.592 TRANSACTIONAL + 0.152 TRANSFORMASTIONAL ................................................................................... 93 EQUATION 14 EFF = 0.576 + 0.091LFL – 0.242 TRANSACTIONAL + 0.964 TRANSFORMASTIONAL ................................................................................... 95

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EQUATION 15 SAT = 0.580 – 0.275 LFL + 0.318 TRANSACTIONAL + 0.755 TRANSFORMATIONAL ...................................................................................... 97 EQUATION 16 OC = 34.159 – 2.480 LFL – 0.442 TRANSACTIONAL + 5.000 TRANSFORMATIONAL .................................................................................... 100 EQUATION 17 EE = – 0.296 + 0.028 LFL + 0.137 TRANSACTIONAL + 0.920 TRANSFORMATIONAL .................................................................................... 102 EQUATION 18 EFF = 0.775 - 0.178 LFL - 0.081TRANSACTIONAL + 0.848 TRANSFORMATIONAL .................................................................................... 104 EQUATION 19 SAT = 1.440 – 0.308 LFL – 0.170 TRANSACTIONAL + 0.729 TRANSFORMATIONAL .................................................................................... 106 EQUATION 20 OC = 32.122 + 2.664 LFL + 1.005 TRANSACTIONAL + 3.899 TRANSFORMASTIONAL ................................................................................. 109 EQUATION 21 EE = 0.958 + 0.090 IIA – 0.072 IIB + 0.225 IM + 0.329 IS + 0.102 IC + 0.003 CR + 0.091 MBEA – 0.016 MBEP – 0.132 LFL ........................................ 116 EQUATION 22 EFF = 1.232 – 0.006 IIA – 0.153 IIB + 0.289 IM + 0.230 IS + 0.093 IC + 0.138 CR + 0.149 MBEA – 0.228 MBEP – 0.059 LFL ..................................... 118 EQUATION 23 SAT = 0.867 + 0.099 IIA + 0.066 IIB + 0.141 IM + 0.295 IS + 0.115 IC – 0.015 CR + 0.003 MBEA + 0.103 MBEP – 0.259 LFL ..................................... 120 EQUATION 24 OC = 46.537 + 2.152 IIA – 2.881 IIB + 1.955 IM + 0.408 IS – 0.711 IC + 0.832 CR + 0.310 MBEA – 2.524 MBEP – 0.096 LFL ..................................... 122 EQUATION 25 EE = 1.491 + 0.065 IIA – 0.250 IIB + 0.352 IM + 0.134 IS – 0.062 IC + 0.147 CR + 0.064 MBEA + 0.145 MBEP – 0.072 LFL ........................................ 125 EQUATION 26 EFF = 0.918 + 0.246 IIA – 0.114 IIB + 0.265 IM + 0.112 IS + 0.216 IC + 0.119 CR – 0.115 MBEA – 0.317 MBEP + 0.168 LFL ..................................... 127 EQUATION 27 SAT = 0.688 – 0.052 IIA + 0.117 IIB + 0.278 IM + 0.313 IS + 0.200 IC + 0.167 CR – 0.093 MBEA + 0.150 MBEP – 0.314 LFL ..................................... 129 EQUATION 28 OC = 37.947 + 3.055 IIA – 0.132 IIB + 1.655 IM + 0.655 IS – 2.624 IC + 1.816 CR + 0.907 MBEA – 3.047 MBEP – 1.127 LFL ..................................... 131 EQUATION 29 EE = 0.049 – 0.098 IIA + 0.246 IIB + 0.318 IM – 0.111 IS + 0.500 IC + 0.149 CR – 0.113 MBEA + 0.086 MBEP – 0.018 LFL ........................................ 134

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EQUATION 30 EFF = 0.970 – 0.044 IIA + 0.166 IIB + 0.189 IM + 0.081 IS + 0.280 IC + 0.144 CR – 0.069 MBEA – 0.065 MBEP – 0.182 LFL ...................................... 136 EQUATION 31 SAT= 1.396 – 0.042 IIA + 0.724 IIB - 0.133 IM + 0.132 IS + 0.101 IC + 0.157 CR – 0.357 MBEA + 0.136 MBEP – 0.321 LFL ........................................ 138 EQUATION 32 OC = 34.047 – 3.449 IIA + 1.215 IIB + 0.285 IM + 0.322 IS + 2.516 IC + 2.846CR + 0.738 MBEA – 0.848 MBEP + 2.780 LFL ...................................... 140

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ABBREVIATIONS CR:

Contingent reward

EE:

Extra Effort

EFF:

Effectiveness

IC:

Individual consideration

IIA:

Idealized influence – attributed

IIB:

Idealized influence – behavior

IM:

Inspirational motivation

IS:

Intellectual stimulation

LFL:

Laissez-faire

MBEA:

Management-by-exception – active

MBEP:

Management-by-exception – passive

OC

Organizational Commitment

SAT:

Satisfaction

TRANSACTIONAL:

Transactional Leadership Style

TRANSFORMATIONAL:

Transformational Leadership Style

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CHAPTER 1: INTRODUCTION This study sought to examine the relationships among perceived leadership style with subordinate organizational commitment. The researcher identified organizational commitment as dependent variable. For better understanding, the researcher named leadership styles as independent variables of level 1. The nine leadership factors, which resulted into three leadership styles, were defined as independent variables of level 2. The researcher studied the relationship of independent variables of level 1 and 2 with dependent variables. The researcher also tried to study the relationship of independent and dependent variables for different samples, and explored for similarities or differences among their relationships with each others. The test of ANOVA was applied to understand the statistical closeness of scores for independent and dependent variables for different samples. Multiple regression technique was used to understand the relationship of multiple independent variables with dependent variables. The researcher tried to test relationships of leadership styles with organizational commitment across different companies in one industry. The researched extended the study by examining the relationship of independent variables with subordinate‘s extra effort, effectiveness and satisfaction. The objective of the study was to explore the relationships of leadership styles with subordinates‘ outcomes for entire sample of 379 respondents, for three different samples (banking, insurance and B-Schools in our case), and for four companies in insurance sector.

1.1 Importance of the Study Periodically, the subject of leadership has attracted massive interest and attention among academicians and practitioners. From time to time, it has been believed that the actual solution to humanity‘s various problems and challenges are placed in the hands of exceptional individuals – leaders (Storey, 2005). The statistics on published books and articles on the subject of leadership reveal exponential growth during the period 1970 to the present day. For example, there were twice as many articles being published per month in the years 2001-02 as there were per year in the equivalent two-year period three 1

decades earlier (Storey, 2004). Despite that the need for an understanding of leadership as complex, contextualized and richer characterization is becoming more audible (Collinson, 2005; Kets, R., & Miller, 1991; Stacey, 1999). Perhaps it is not surprising that an increasing number of scholars are examining venues for understanding leadership as complex and contextualized matter. An increasing number of authors, both in organizational studies and in leadership and management studies (Cheney, 1983; Cheney & McMillan, 1990; Cheney & Tompkins, 1987; Cummings, 1996; Mintzberg, 1989; Morris, 1997; Tsoukas & Cummings, 1997) are producing theory and empirical research intended to be actionable, integrated, and contextualized. Kodish (2006) said that many of researchers by adding little to leadership research, for the most part, fails to embrace the complexity and the paradox inherent in human deliberation and action. We can best describe the way ―leadership‖ has been tackled as butterfly catching. Researchers, management theorists and practitioners have brandished their nets in an effort to find the genuine article (Connor & Mackenzie-Smith, 2003). Earlier in the 19th century, the successful executive – leader – was generally pictured as possessing intelligence, imagination, initiative, the capacity to make rapid (and generally wise) decisions, and the ability to inspire subordinates. People tended to think of the world as being divided into ―leaders‖ and ―followers‖ (Tannenbaum & Schmidt, 1973). But, in this changing scenario of 21 st century, it is highly important for managers to be honest and clear in describing what authority they are keeping and what role they are asking their subordinates to assume in solving a particular problem. According to Cacioppe (1997), the successful leader has an ability to be in the present and see the situation free from preconceived ideas. While the leader may have previous experience and personal views or values, they do not cloud his or her ability to discover what is best action in that situation. As Piramal (1996) wrote, the more she learnt about the business, the more she became convinced that management decisions are based on personal experiences, aims and vision of one person. Usually, it is the head of a business house or the chairman of a company, but sometimes crucial decisions can be taken by unexpected people in the organization. That shows the importance of leadership in the organization. Dhirubhai Ambani once said, ―I consider myself a pathfinder. I have been excavating the jungle and making the road for others to walk. I like to be the first in everything I do. Making money 2

does not excite me, though I have to make it for my shareholders. What excites me is achievement. I could never do a normal job. In this room, extraordinary things must happen‖ (Piramal, 1996). That justifies the importance of leadership in the organization. What separates the episodes of excellence from those of mere competence? In striving to tip balance toward excellence, we try to identify great leaders‘ qualities and behaviors so we can develop them ourselves. Nearly, all corporate training programs and books on leadership are grounded in the assumption that we should study the behaviors of those who have been successful and teach people to emulate them (Quinn, 2005). On the other side, some researchers have confirmed that the leadership style is influenced by leaders' personal characteristics, employees' personal characteristics and organizational features (Tannenbaum & Schmidt, 1973; Yukl, 1998; Maheshwari, 1980). Quinn (2005) found that leaders draw on their own fundamental values and capabilities – operating in a frame of mind that is true to them yet, paradoxically, not their normal state of being. Even those who are widely admired for their seemingly easy and natural leadership skills – presidents, prime minister, CEOs – do not usually function in the fundamental state of leadership. Most of the time, they are in the normal state. Prentice (1961) defined leadership as ―the accomplishment of a goal through the direction of human assistants‖ and a successful leader as one who can understand people‘s motivations and enlist employee participation in a way that marries individual needs and interests to the group‘s purpose. Attempts to analyze leadership tend to fail because the would-be analyst misconceives his task. He usually does not study leadership at all. Instead he studies popularity, power, showmanship, or wisdom in long-range planning. Some leaders have these things, but they are not of the essence of leadership. Leadership is the accomplishment of a goal through the direction of human assistants. The man who successfully marshals his human collaborators to achieve particular ends is a leader. A great leader is one who can do so day after day, and year after year, in a wide variety of circumstances. He may not possess or display power, force or the threat of harm may never enter into his dealings. He may not be popular, his followers may never do what he wishes out of love or admiration for him. He may not ever be a colorful person; he may never use memorable devices to dramatize the purposes of his group or to focus attention on his leadership. As for the 3

important matter of setting goals, he may actually be a man of little influence, or even of little skill; as a leader he may merely carry out the plans of others. His unique achievement is a human and social one which stems from his understanding of his fellow workers and the relationship of their individual goals and the group goal that he must carry out. It is not hard to state in a few words what successful leaders do that make them effective. But it is much harder to tease out the components that determine their success (Prentice, 1961). When a leader succeeds, it will be because he has learned two basic lessons: Men are complex, and men are different. Human beings respond not only to the traditional carrot and stick used by the driver of donkey but also to ambition, patriotism, love of the good and the beautiful, boredom, self-doubt, and many more dimensions and patterns of thought and feeling that make them men. But the strength and importance of these interests are not the same for every worker, nor is the degree to which they can be satisfied in his job. An understanding leader will not let his workers think that he considers them inferiors, but he may be wise to maintain a kind of psychological distance that permits them to accept his authority without resentment (Prentice, 1961). In such complex and overly emphasized scenario, it becomes imperative to study leadership with specific objectives, narrowing our approach to specific criteria. In this research, the researcher has made an attempt to study perceived leadership style demonstrated by branch managers of public sector bank, insurance companies and directors of business schools in Gujarat. The researched identified subordinate organizational commitment, extra effort, effectiveness, and satisfaction as dependent variables. The three leadership styles, i.e. transactional, transformational and laissez-faire leadership style, were considered as independent variables. The researchers also studied the relationships of leadership factors (idealized influence - attributed, idealized influence - behavior, individual consideration, inspirational motivation, intellectual stimulation, contingent reward, management by exception - active, management by exception passive) with dependent variables.

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1.2 Challenges for Leaders Diversification, globalization and technological innovation have caused many business organizations to change rapidly. The need for continued flexibility is clear. Levin‘s model of change as ―freeze, unfreeze, refreeze‖ is no longer adequate in our competitive environments. Change can‘t be static, it must be fluid. As business environment become increasingly competitive and complex, organizations must be alert and flexible to remain competitive. Complacency within an organization can lead to inertia. Organizations that do not remain competitive will often begin a gradual downward trend in financial performance and must be revitalized for continued survival (Landrum, Howell, & Paris, 2000). Kevin Kelly, author of the best-selling book New Rules for the New Economy, stated boldly that the new economy would change our lives dramatically by unleashing opportunities never seen before (Kelly, 1999). Gupta (2010) in his editorial note mentioned that if 2007 was the year of froth, 2008 that of collapse, and 2009 of reflection, then 2010 will be about a new way of working. It will be about discovering new horizons, but through new means. The world is experiencing an unprecedented economic downtrend. The uncertainty that comes with such as economic environment is compounded with accelerated and profound changes in today‘s business world – technological, cultural, economic and personal. The net effect is increasing anxiety, insecurity, and more pressure than ever before on today‘s employees, managers, leaders and organizations. In times of economic uncertainty, organizations often need to make cultural shifts. Here‘s a paradox of contemporary business life: companies today may operate in many countries around the world without actually being global businesses. How could that be? The disconnect arises because they lack an overarching global mindset that guides their actions and decisions from region to region and country to country. For companies seeking to achieve high performance in a multi-polar world - that is, a world in which emerging economies are beginning to compete on an equal footing with the developed world for talent, customers, resources, capital, and ideas - the absence of such a mindset is a major stumbling block. The distinction between ―doing business globally‖ and ―being a global business‖ is not simply a matter of what portion of their revenue companies 5

generate from cross-border transactions. It points instead to the necessity for managers to actually think globally: to incorporate differences in operating environments, law, culture and custom, and customer values into the way they think about doing business. Recent Accenture research indicates that successful multinational corporations will be increasingly defined by their ability to understand and interpret emerging trends in markets around the world (Bellin & Pham, 2008). Accenture survey revealed that 95 percent of senior executives in multinationals headquartered in developed markets worry that their companies don‘t have the right recipe for managing (or extending) their global footprint. More recently, however, the playing field has changed. Developed-market multinationals now find themselves competing with upstarts from emerging economies. Competition in many industries is now truly global. Emerging-market multinationals in automotive, IT and energy have gained a significant presence in developed economies. Established multinationals struggle to outfox nimble local competitors in many sectors of emerging economies (Girod, Peterson, & Bellin, 2009). To achieve high performance and better bottom line business results, many senior leaders are considering taking an approach that has proved successful in customer relationship management and applying it to human capital management: tailoring products and services to achieve a better fit with individual needs and preferences. The same executives who have recognized the value of approaching each customer as ―a market of one‖ are now striving to approach each employee as a ―workforce of one,‖ with the goal of maximizing the performance of perhaps their most critical resource – their people (Cantrell & Miele, 2007). The management task in our society is becoming increasingly complex and difficult. Our deregulated and highly competitive business environment places a premium on quality management and leadership, more so than at any time in the past. Moreover, people in our organizations today raise the questions. They want to know why. Many workers today do not know ―their place‖. They are smarter and better informed. We no longer have servants or slave. Their approach is not servile but competitive and adversarial. This undoubtedly makes the leader‘s role more difficult, at least more challenging. We are a society of organizations; we get things done through people in an organized way. Humankind has progressed because of the ability to work effectively in organizations. The demand for new, quality managers is never ending – it is 6

insatiable. We must never stop developing new leaders. The turmoil for transformation in technology, global markets, shifts in offerings, from products to solutions, demands for better education and health care, and threats to our security all call for leadership that creates collaboration. But in this new context, the age of knowledge work, would-be leader can‘t get people to follow them in ways that worked in the past. That‘s because historic changes in culture are forming a social character in the advanced globalized economy that is more interactive and less bureaucratic. Clearly genetic qualities like curiosity, conscientiousness, agreeableness, and emotional stability make a difference in why people become leaders. Upbringing can strengthen these qualities, and school sports, and other activities can provide opportunities to practice leadership (Maccoby, 2008). Senge (1990) pointed out that organizations need to adapt to their changing environments. Local line leaders in the organization and high level executives as well as internal networkers and community leaders are needed who can motivate and direct the organization and its members to learn to adapt to the changes. The changes in the economic environment from local, to national, to global markets require new perspectives. Interspersed with these changes are the rapidly ever-changing developments in informational technology with which the organization and its members have to become intimately involved for acquisition and processing of information from the internal and external environments. The organization has to learn how to adapt to changes in the diversity of its workforce and customers as well as to the changing demands for social responsibility.

1.3 Outline of the Thesis This thesis is divided into two major parts. The first deals with the importance of the study, challenges for leaders, and literature review; while second part focuses on the empirical research. Chapter 1 describes the importance for selecting the topic for research. It starts with our natural understanding of leadership as (mis)concept of management. Giving the brief outline of leadership concepts, the researcher has made an attempt to justify the selection of the topic. To explore the subject, the researcher has selected multiple samples from academia and corporate world. 7

Chapter 2 gives detailed information on leadership theories. The first attempt to define leadership as theory was made by Stogdill in early 70s. He studied traits and characteristics of successful leaders, and tried to find out common traits among them. Since then, the researchers and practitioners across world have given various definitions of leadership. Ohio State and Michigan State leadership theory became famous, describing particular style of behavioral patterns shown by successful leaders. Fiedler in 1964 showed the role and importance of situational parameters for success of any leader. The researcher tried to study every major theory of leadership. Chapter 3 gives outline of research methodology. This chapter categorically defines the objectives of the study, hypotheses formed for the study, research design, scope of the study, measuring instruments, data collection procedure and limitation to the proposed study. Chapter 4 provides analysis and interpretation of the primary data collected with the help of research questionnaire. We analyzed the data with the help of Pearson Coefficients, and Analysis of Variance. The researcher followed six step analyses for collected data. In step 1, he analyzed all the responses for 56 leaders and 379 subordinates. Step 2 of analysis focused on correlation analysis for independent variables (level 1 & 2) with dependent variables for each sample representation. The researcher, in step 3, did comparative analysis for independent variables between three samples. The comparative analysis for dependent variables between three samples was performed in step 4. The comparative analysis for independent variables and dependent variables for four companies in one sector was done in step 5 & 6 subsequently. In chapter 5, the researcher has discussed interpretation of the data analysis. The researcher has discussed the outcome for leadership styles and its outcome, leadership factors and its outcome, and leadership styles across samples. The researcher has made an attempt to outline managerial implications of the study. In chapter 6, the researcher has, with his best of knowledge, made recommendations for further research in this highly researched area of leadership.

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CHAPTER 2: REVIEW OF LITERATURE 2.1 Introduction Leadership is one of the most complex and multifaceted phenomena to which organizational and psychological research has been applied. While the term "leader" was noted as early as the 1300s and conceptualized even before biblical times, the term leadership has been in existence only since the late 1700s (Stogdill, 1974). Even then, scientific research on the topic did not begin until the twentieth century (Bass B. M., 1985). Since that time, however, there has been intensive research on the subject. Over the last 50 years, leadership has been examined in terms of enduring traits, sets of behaviors or styles, situational properties, and presumed cognitive processes. Despite numerous theories and volumes of research, little cumulative knowledge has been gained. Much of the research has not been helpful precisely because it has neglected the observation of real events, and instead focused on questionnaire response. Many of the terms contained leadership questionnaire may describe commonly held feelings of leaders and subordinates, but not necessarily describe the behavioral contingencies that control desired performance outcomes (Davis & Luthans, 1979). Indeed, Bennis (1959) states that, "Of all the hazy and confounding areas in social psychology, leadership theory undoubtedly contends for the top nomination. And, ironically, probably more has been written and less known about leadership than about any other topic in the behavioral sciences" (p 259). Burns (1978) similarly remarks that, "Leadership is one of the most observed and least understood phenomena on earth." This problem arises not only in understanding the operation of the theory but even in its definition. Stogdill (1974) claims that, "There are almost as many definitions of leadership as those who have attempted to define the concept." Indeed, seven decades of research on the subject has led Stogdill to conclude that the ―endless accumulation of empirical data has not produced an integrated understanding of leadership. Sometimes different terms have been used to refer to the same type of behavior. At other times, the same terms has been defined differently by various theorists. What is treated as a general behavior category by one theorist is viewed 9

as two or three distinct categories by another theorist. What is a key concept in one taxonomy is absent from another. Different taxonomies have emerged from different research disciplines, and it is difficult to translate from one set of concepts to another (Yukl, Gordon, & Taber, 2002). They noted that in the past there has been overemphasis on metacategories. For example, much of the research during the 1960s and 1970s used measures of consideration and initiating structure, rather that examining results for specific components of these broadly-defined behaviors. The metacategories are useful for organizing specific behaviors with a similar objective, but they should examine results for the specific behaviors as well as the metacategories in the same study. The utility of metacategories will depend on the extent to which they are able to improve the prediction of leadership effectiveness or the explanation of why some leaders are more effective than others in a given situation. Various camps are concerned with important but entirely difficult aspects of leadership. Each camp, however, represents the dimension of leadership with which it is preoccupied as a complete leadership theory. Such a practice leads to superficial contradictions in the same way that one blind man‘s description of the trunk of the elephant differs from another blind man‘s description of an elephant‘s belly. Pondy (1976) remarked that have we been misled by the existence of a single term in our language to think that it reflects some uniform reality? Calder (1977) also pointed out that in the progression from the trait approach to complex transactional-contingency views, leadership has taken on such expanded meaning that it can‘t be differentiated from any other general model of behavior. A major problem is that leadership is seldom directly observed but is merely perceived and conferred (Davis & Luthans, 1979).

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FIGURE 1 EVOLUTIONARY STAGES OF LEADERSHIP THEORY

Source: King, A. (1990). Evolution of leadership theories. Vikalpa , 15 (2), 43-57.

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2.2 Defining Leadership Prentice (1961) defined leadership as ―the accomplishment of a goal through the direction of human assistants‖ and a successful leader as one who can understand people‘s motivations and enlist employee participation in a way that marries individual needs and interests to the group‘s purpose. He called for democratic leadership that gives employees opportunities to learn and grow – without creating anarchy. Mintzberg (1973) proposed that leadership role is one of ten managerial roles, albeit the most important one. The other nine managerial roles are: figurehead, liaison, monitor, disseminator, spokesperson, entrepreneur, disturbance handler, resource allocator, and negotiator. Tannenbaum & Schmidt (1973) proposed that successful leaders are those who are keenly aware of the forces which are most relevant to their behavior at any given time. They accurately understand themselves, the individuals and groups they are dealing with, and the company and broader social environment in which they operate. And certainly they are able to assess the present readiness for growth of their subordinates. Successful leaders are those who are able to behave appropriately in the light of these perceptions. If direction is in order, they are able to direct; if considerable participative freedom is called for, they are able to provide such freedom. Leadership is the reciprocal process of mobilizing, by persons with certain motives and values, various economic, political, and other resources, in a context of competition and conflict, in order to realize goals independently or mutually held by both leaders and followers. This is transactional leadership (Burns, 1978, p. 425). The object in these cases is not a joint effort for persons with common aims acting for the collective interests of followers but a bargain to aid the individual interests of persons or groups going their separate ways. Gardner (1987) includes these characteristics in his discussion of basic leadership tasks: envisioning goals, affirming values, motivating, managing, achieving a workable level of unity, explaining, serving as a symbol, representing the group externally, and renewing. The qualities and skills of a leader go far beyond cultivating a friendly personality, or applying the sophisticated methods and principles of management/administration, or practicing the techniques of human relations. A leader's vital function is to visualize and concretize the ethos of values in the work and objectives of the work groups. He has to 12

define and articulate the work goals and purposes in terms of a larger and imaginative vision. He has to impart and sustain a vision in which work excellence, duty, and cooperation of people are seen to be related to his eternal purposes. He should transmute small, selfish, and parochial objectives of individuals into larger social and spiritual goals (Rastogi, 1987). Leadership is defined as ―an interaction between two or more members of a group that often involves a structuring or restructuring of the situation and the perceptions and expectations of members‖ (Bass B. , 1990). Rost (1991) mentioned that leadership is a substitute for ―the collective leaders who are in office‖ or ―the leaders in an administration.‖ Another popular notion given by him is that of one person directing other people. He equated leadership with what one person does to a group of people who make up an organization. He defined leadership as an influence relationship among leaders and followers who intend real changes that reflect their mutual purposes (p. 102). From this definition, there are four essential elements that must be present if leadership exists or is occurring: the relationship is based on influence; leaders and followers are the people in this relationship; leaders and followers intend real changes; leaders and followers develop mutual purposes. He explained that the leadership relationship is multidirectional. The relationship involves interactions that are vertical, horizontal, diagonal, and circular. This means that anyone can be a leader and/or follower; followers persuade leaders and other followers, as do leaders; leaders and followers may change places in the relationship; there are many different relationships that can make up the overall relationship that is leadership (p. 105). Second, leadership is an influential relationship, means that the behavior used to persuade other people must be noncoercive. If the behaviors are coercive, the relationship becomes one of authority or power, or one that is dictatorial. Followers are active, not passive, in the relationship. They do leadership, not followership. There is typically more than one leader, and there must be more than one follower. And, finally, the influence patterns in the relationship are inherently unequal because leaders typically exert more influence than that of followers (p.112). According to this definition of leadership, leaders and followers intend real changes. Intend means that the changes are purposeful and are in the future. The intention is in the present, and leaders and followers give solid evidence of their intentions by their words and actions. The intention is part of the glue that holds the 13

relationship together. Real means that the changes the leaders and followers intend are substantive and transforming, not pseudo changes. The intention to change is all that is required. Leadership does not require the leaders and followers actually to accomplish the changes. Finally, leaders and followers develop mutual purposes through noncoercive, influential relationship. These are purposes and not goals; more overarching and holistic, less oriented to quantification. The leaders and followers reflect, not realize, their purposes (p. 123). Adair (2009) said that to be successful leader, one needs to require awareness of what is going on in groups (the group process or underlying behavior), then one needs understanding which means in this context knowing that a particular function is required, and one should have the skill to do it well enough to be effective. That can usually be judged by whether or not the group responds or changes course. You can bring to see why a degree to self sufficiency is important for a leader. Leadership is not about popularity, though it would be inhuman not to enjoy being liked. Because leaders tend to have social, even gregarious natures, they can find the inevitable brickbats that come their way to endure. But what matters in the long run is not how many rounds of applause a leader receives but how much respect he gains, and that is never achieved by being ‗soft‘ or ‗weak‘ in the task, team or individual circles. Simply, leadership is a choice, not a position (Covey S. , 2009).

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FIGURE 2 THE EVOLUTIONARY TREE OF LEADERSHIP THEORY

Source: King, A. (1990). Evolution of leadership theories. Vikalpa , 15 (2), 43-57.

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As we have seen that different researchers have defined leadership differently, let us go through the major camps of leadership which have made the subject very interesting. Again, our aim is to go through their understanding of the subject, we will not delve into criticizing, approving or disapproving any of their arguments.

2.3 Trait Theory of Leadership One of the earliest approaches for studying leadership was the trait approach. This approach emphasizes leaders‘ attributes such as personality, motives, values and skills. The basic premise of this approach was the assumption that some people are natural leaders, endowed with certain traits not possessed by other people. They have extraordinary abilities such as tireless energy, penetrating intuition, uncanny foresight, and irresistible persuasive powers. Stogdill (1948) reviewed 124 trait-studies conducted from 1904 to 1948 and found that the pattern of results was consistent with the conception of a leader as someone who acquires status by showing the ability to help the group in attaining its goals. The following conclusions were supported by uniformly positive evidence from the study surveyed: The average person who occupies a position of leadership exceeds the average member of his group in the following respects: intelligence, scholarship, dependability in exercising responsibilities, activity and social participation, socio-economic status, initiative, persistence, knowing how to get things done, self confidence, alertness to, and insight into, situations, cooperativeness, popularity, adaptability, verbal facility. The qualities, characteristics and skills required in a leader are determined to a large extent by demands of the situation in which he is to function as a leader. The items with highest overall correlation with leadership are originality, popularity, sociability, judgment, aggressiveness, desire to excel, humor, cooperativeness, liveliness, and athletic ability, in appropriate order of magnitude of average correlation coefficient.

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In spite of considerable negative evidence, the general trend of results suggests a low positive correlation between leadership and such variables as chronological age, height, weight, physique, energy, appearance, dominance, and mood control. He classified all factors associated with leadership under the general headings of Capacity (intelligence, alertness, verbal facility, originality, judgment), Achievement (scholarship, knowledge, athletic accomplishment), Responsibility (dependability, initiative, persistence, aggressiveness, self confidence, desire to excel), Participation (activity, sociability, cooperation, adaptability, humor), Status (socio-economic position, popularity), Situation (mental level, status, skills, needs and interests of followers, objectives to be achieved etc.). Hundreds of trait studies conducted during 1930s and 1940s sought to discover these qualities, but this massive research failed to find any traits that would guarantee leadership success. One reason for the failure was missing explanatory process behind success of any leader. FIGURE 3 LEADERSHIP TRAITS AND CHARACTERISTICS Capacity

(intelligence, alertness, verbal facility, originality, judgment)

Achievement

(scholarship, knowledge, athletic accomplishment)

Responsibility

(dependability, initiative, persistence, aggressiveness, self confidence, desire to excel)

Participation

(activity, sociability, cooperation, adaptability, humor)

Status

(socio-economic position, popularity)

Situation

(mental level, status, skills, needs and interests of followers, objectives to be achieved etc.).

Source: Stogdill, M. (1974). Handbook of leadership: A survey of theory and research. New York: Free Press.

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2.4 Behavioral Theory of Leadership So far, leadership has been studied informally by observing the lives of great men and formally by attempting to identify the personality traits of acknowledged leaders through assessment techniques. Since the Second World War, research emphasis has shifted from a search for personality traits to search for behavior that makes a difference in the performance or satisfaction of the followers. One line of research examines how managers spend their time and the typical pattern of activities, responsibilities, and functions for managerial jobs. Few of the research also examine how managers cope with demands, constraints, and role conflicts in their jobs. As per this approach, leadership effectiveness depends in part on how well a manager resolves role conflicts, copes with demands, recognizes opportunities, and overcomes constraints. The first study in this area was performed by Levin, Lippit and White at the University of Iowa. Lewin, Lippit, & White (1939) tried to find out what underlies differing patterns of group behavior as rebellion against authority, persecution of a scapegoat, apathetic submissiveness to authoritarian domination, or attack upon an outgroup. They studied whether differences in subgroup structure, group satisfaction, and potency of egocentered and group-centered goals can be utilized as criteria for predicting the social resultants of different group atmospheres. In the first experiment, hostility was 30 times as frequent in the autocratic as in the democratic group. Aggression (including both ―hostility‖ and ―joking hostility‖) was 8 times as frequent. Much of this aggression was directed toward the autocrat. In the second experiment, one of the five autocrats showed the same aggressive reaction as was found in the first experiment. In the other four autocracies, the boys showed an extremely non-aggressiveness, apathetic pattern of behavior. Four types of evidence indicated that this lack of aggression was probably not caused by lack of frustration, but by the repressive influence of the autocrat: (a) outbursts of aggression, (b) a sharp rise of aggression when the autocrat left the room; (c) other indications of generalized apathy, such as an absence of smiling and joking; and (d) the fact that 19 out of 20 boys liked their democratic leader better than their autocratic leader, and 7 out of 10 also liked their ―laissez-faire‖ leader better.

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FIGURE 4 BEHAVIORAL THEORY OF LEADERSHIP Consideration

(behavior indicative of friendship, mutual trust, respect, and warmth)

Initiative Structure

(behavior that organizes and defines relationships or roles, and establishes well-defined patterns of organization, channels of communication, and ways of getting jobs done)

Production Emphasis (behavior which makes up a manner of motivating the group to greater activity by emphasizing the mission or job to be done) Social Awareness

(sensitivity of leader to, and his awareness of, social interrelationships and pressures inside or outside the group).

Source: Levin, K., Lippit, R., & White, R. (1939). Patterns of aggressive behavior in experimentally created social climates. Journal of Social Psychology, 10, 271-301. A factoral analysis of the inter-correlations among 8 hypothesized dimensions of leader behavior resulted in the emergence of 4 factors. These factors were identified as Consideration (behavior indicative of friendship, mutual trust, respect, and warmth), Initiating Structure (behavior that organizes and defines relationships or roles, and establishes well-defined patterns of organization, channels of communication, and ways of getting jobs done), Production Emphasis (behavior which makes up a manner of motivating the group to greater activity by emphasizing the mission or job to be done), and Social Awareness (sensitivity of leader to, and his awareness of, social interrelationships and pressures inside or outside the group). Two factors, Consideration and Initiating Structure, accounted for 83 per cent of the total factor variance. Consideration was found to be correlated negatively with leadership effectiveness ratings by superiors, while Initiating Structure was positively related to effectiveness ratings. Consideration was not perceived as a form of behavior which contributes directly toward leadership effectiveness. The study was sponsored jointly by the Human Resources Research Laboratories, Department of the Air Force, and The Ohio State University

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Research Foundation. Consideration and Initiating Structure became to some extent identified as ―the Ohio State‖ dimension of leadership.

2.5 Fiedler’s Contingency Theory of Leadership Although several approaches to leadership could be called contingency theories, the most widely recognized is Fiedler‘s contingency theory. Contingency theory is a leader-match theory, which means it tries to match leaders to appropriate situations. It is called contingency because it suggests that a leader‘s effectiveness depends on how well the leader‘s style fits the context. To understand the performance of leaders, it is essential to understand the situations in which they lead. Effective leadership is contingent on matching a leader‘s style to the right setting. The organization that employs the leader is as responsible for his success or failure as the leader himself. Terman wrote in 1904 that leadership performance depends on the situation, as well as on the leader Fiedler (1964). Practically, all formal training programs attempt to change the individual; many of them assume explicitly or implicitly that there is one style of leadership or one way of acting that will work best under all conditions. Others assume that the training should enable the individual to become more flexible or more sensitive to his environment so that he can adapt himself to it. The effectiveness of the leader will be defined in terms of how well his group or organization performs the primary tasks for which the group exists. We measure the effectiveness of a football coach by how many games his team wins and not by the character he builds, and the excellence of an orchestra conductor by how well his orchestra plays, not by the happiness of his musicians‘ or his ability as a musicologist. Whether the musicians‘ job satisfaction or the conductor‘s musicological expertness do, in fact, contribute to the orchestra‘s excellence is an interesting question in its own right, but it is not what people pay to hear. Likewise, the performance of a manager is here measured in terms of his department or group effectiveness in doing its assigned job. When we think of improving leadership, we almost automatically think of training the individual. This training frequently involves giving the man a new perspective on his supervisory responsibilities by means of role playing, discussions, detailed instructions on how to behave toward subordinates, as well as instruction in the technical and administrative skills he will need 20

in his job. A training program might last a few days, a few months, or as in the case of college programs and military academics, as long as four years. What is hard evidence that his type of training actually increases organizational performance? The contingency model of leadership holds that the effectiveness of group performance is contingent upon (a) the leader‘s motivational pattern, and (b) the degree to which the situation gives the leader power and influence. Some leaders perform better in one kind of situations while some others perform better in different kind of situations. What kinds of situations are best suited for which type of leaders is an important question to be answered. It is easier for a leader when you have complete control than when your control is weak and dependent on the goodwill of others. FIGURE 5 FIEDLER‘S CONTINGENCY MODEL OF LEADERSHIP

Source: Fiedler, F. (1964). A Contingency model of leadership effectiveness, in L. Berkowitz (ed.). Advances in Experimental Social Psychology, 149–90. New York: Academic Press. Fiedler (1964) classified leadership situations on the basis of three major dimensions: Leader-member relations: Leaders have more power and influence if they have a good relationship with their members than if they have a poor relationship with them; if they are liked, respected, and trusted, than if they are not. Task structure: Tasks or assignments that are highly structured, spell out, or programmed give the leader more influence than tasks that are vague, nebulous and unstructured.

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Position power: Leaders will have more power and influence if their position is vested with such prerogatives as being able to hire and fire, being able to discipline, to reprimand, and so on. He concluded that the performance of a leader depends as much on the situation favorableness as it does on the individual in the leadership position. Hence, the organization can change leadership performance by trying to change the individual‘s personality and motivation pattern or by changing the favorableness of the leader‘s situation.

2.6 Path-Goal Theory of Leadership The theory is called Path-Goal because its major concern is how the leader influences the subordinates‘ perceptions of their work goals, personal goals and paths to goal attainment. The theory suggests that a leader‘s behavior is motivating or satisfying to the degree that the behavior increases subordinate goal attainment and clarifies the paths to these goals (House & Mitchell, 1974). The path-goal approach has its roots in a more general motivational theory called expectancy theory. Briefly, expectancy theory states that an individual‘s attitude (e.g. satisfaction with supervision or job satisfaction) or behavior (e.g. leader behavior or job effort) can be predicted from: (1) the degree to which the job, or behavior, is seen as leading to various outcomes (expectancy) and (2) the evaluation of these outcomes (valences). Thus, people are satisfied with their job if they think it leads to things that are highly valued, and they work hard if they believe that effort leads to things that are highly valued. The implication for leadership is that subordinates are motivated by leader behavior to the extent that his behavior influences expectancies, e.g. goal-paths, and valences, e.g. goal attractiveness. The first proposition of the path-goal theory is that leader behavior is acceptable and satisfying to subordinates to the extent that subordinates see such behavior as either an immediate source of satisfaction or as instrumental to future satisfaction. The second proposition of this theory is that the leader‘s behavior will be motivational, i.e. increase effort, to the extent that (1) such behavior makes satisfaction of subordinates‘ need 22

contingent on effective performance and (2) such behavior complements the environment of subordinates by providing the coaching, guidance, support and rewards necessary for effective performance. These two propositions suggest that the leader‘s strategic functions are to enhance subordinates‘ motivation to perform, satisfaction with the job and acceptance of the leader. FIGURE 6 PATH-GOAL THEORY OF LEADERSHIP

Source: House, R., & Mitchell, T. (1974). Path-goal theory of leadership, Journal of Contemporary Business, 81-97. House & Mitchell (1974) talked about different leadership behaviors like directive, supportive, achievement oriented, and participative leadership. Leader directiveness has a positive correlation with satisfaction and expectancies of subordinates who are engaged in ambiguous tasks; and has a negative correlation with satisfaction and expectancies of subordinates engaged in clear tasks. The theory hypothesizes that supportive leadership will have its most positive effect on subordinates satisfaction for those subordinates who work on stressful, frustrating or dissatisfying tasks. The theory also suggests that achievement-oriented leadership will cause subordinates to strive for higher standards of performance and to have more confidence in the ability to meet challenging goals. For subordinates performing ambiguous, nonrepetitive tasks, they found a positive 23

relationship between achievement orientation of the leader and subordinates expectancy; that their effort would result in effective performance. They described participative leadership style that would impact on subordinate attitude and behavior. They proposed that participative climate should increase the clarity amid organizational contingency. Through participation in decision making, subordinates should learn what leads to what. From path-goal viewpoint, participation would lead to greater clarity of the paths to various goals. A second impact of participation would be that subordinates, hopefully, should select goals they highly value. Participation would increase the correspondence between organization and subordinate goals.

2.7 Vroom Theory of Decision Making In early 1970s, Vroom & Yetton (1973) proposed a set of alternative decision processes that they employed in their research. Each process is represented by a symbol (e.g. AI, CI, GII) used as a convenient method of referring to each process. The first letter in this symbol signifies the basic properties of the process (A stands for autocratic; C for consultative; and G for group). The Roman numerals that follow the first letter constitute variants on the process. Thus, AI represents the first variant on an autocratic process, and AII the second variant. The decision processes specified for each problem type are not arbitrary. The model‘s behavior is governed by a set of principles intended to be consistent with existing evidence, concerning the consequences of participation in decision making on organizational effectiveness. They proposed seven rules that serve to protect the quality and the acceptance of the decision by eliminating alternatives that risk one or the other of these decision outcomes. These seven rules are based on information, goal congruence, unstructured problem, acceptance, conflict, fairness, and acceptance priority. The five types of management decision making styles they suggested are as follows: AI

You (leader) solve the problem or make the decision yourself, using information available to you at that time.

AII

You obtain the necessary information from your subordinate(s), then decide on the solution to the problem yourself. You may or may not tell your subordinates 24

what the problem is in getting information from them. The role played by your subordinates in making the decision is clearly one of providing the necessary information to you, rather than generating or evaluating alternative solutions. CI

You share the problem with relevant subordinates individually, getting their ideas and suggestions, without bringing them together as a group. Then, you make the decision that may or may not reflect your subordinates‘ influence.

CII

You share the problem with your subordinates as a group, collectively obtaining their ideas and suggestions. Then, you make the decision that may or may not reflect your subordinates‘ influence.

GII

You share a problem with your subordinates as a group. Together you generate and evaluate alternatives and attempt to reach agreement (consensus) on a solution. Your role is much like that of chairman. You do not try to influence the group to adopt ―your‖ solution and you are willing to accept and implement any solution that has the support of the entire group.

This approach is based on the assumption that one of the critical skills required of all leaders is the ability to adapt their behavior to the demands of the situation, and that one component of this skill involves the ability to select the appropriate decision making process for each problem or decision he confronts. Managers use decision processes providing less opportunity for participation (1) when they possess all the necessary information than when they lack some of the needed information, (2) when problem that they face is well-structured rather than unstructured, (3) when their subordinates‘ acceptance of the decision is not critical for the effective implementation of the decision or when the prior probability of acceptance of an autocratic decision is high, and (4) when the personal goals of their subordinates are not congruent with the goals of the organization as manifested in the problem.

2.8 Managerial Grid Blake & Mouton (1964) proposed Managerial Grid with two primary parameters, concern for production and concern for people. On a nine point scale (1 represents minimum 25

concern and 9 represents maximum concern), they placed concern for production on horizontal axis and concern for people at vertical axis. So, (1, 1) style represents minimum concern for both, production and people. Going up the grid, from (1, 1) style to the upper left corner is found the (1, 9) style, which represents minimum concern for production and maximum concern for people. In the lower right corner is (9, 1) style, which has a maximum concern for production and minimum concern for people. In the upper right corner is the (9, 9) style, which has got maximum concern for production and people. Then, in the center is (5, 5) style, which is middle of the road, or an intermediate amount of both kinds of concerns (p.11). They emphasized that the manner in which these two concerns are interlinked together by a manager defines how he uses hierarchy. FIGURE 7 MANAGERIAL GRID

Source: Blake, R., & Mouton, J. (1964). The managerial grid, Houston, TX.: Gulf Publishing. They said that one dominant managerial style, a single set of managerial assumptions, is not sufficient to catch the full implication of a person‘s managerial approach. In addition to a dominant set of managerial assumptions which is the most characteristic of managerial style a person has adopted, the concept of backup set of assumption is a 26

useful one. An individual‘s backup theory is the one he uses when his dominant theory fails to get desired results. It is the style he falls back on (p.13). The point to be emphasized is that managerial styles are not fixed. They are not unchanging. They are determined by a range of factors. Many are subject to modification through formal instructions or self-training (p. 15).

2.9 Transactional Leadership Hollander (1974) proposed that leadership is, in fact, a transactional process. That class of behaviors associated with a ―leader‖ is not confined to one person who acts alone; there is a relationship with followers who perceive and evaluate the leader in the context of situational demands, whether that relationship is made explicit or not. He proposed that to specify the transactional quality of leadership more completely, three determinants must be considered, i.e. the ―leader‖ with his (her) personality, perceptions, and resources relevant to goal attainment; the ―followers‖ with their personalities, perceptions, and relevant resources; and the situational context within which those variables function. FIGURE 8 TRANSACTIONAL LEADERSHIP

Source: Bass, B. (1985). Leadership and performance beyond expectations. New York: Free Press. 27

According to him, leadership embodies a two-way influence relationship. Influence assertions from the leader to followers are reciprocated in demands made on the leader. Therefore, the integrity of the relationship depends on some yielding to influence on both sides. Therefore, there are several pathways to become a leader, sometimes from higher authority and sometimes from group consent; and leadership involves diverse functions among persons in varying roles. He explained that there is a need to see the leader‘s role as involving a variety of functions, not just the direction of activity. The dichotomy between being leader or a follower is out-dated, and greater specification of the diverse components of situations in which leader-follower influence occurs is required. More needs to be understood about the leader‘s function as a ―definer-of-reality‖ for followers. In general, the transactional features of that relationship must be appreciated.

2.10 Leader-Member Exchange Theory of Leadership Role making is a set of processes by which an actor and a functionally interdependent other: (1) work through how each will behave in certain situations (interlocking behavior by reciprocal reinforcement), and (2) agree upon the general nature of their relationship (constructing relationship norms) against the background of the formal organization. A special case of role making, namely, that involving the functional interdependence between a person in a leader position and one in a follower position can be used to describe a vertical development process. Role making process can be used to describe the development of both interlocked behavior and relationship norms between leaders and each of their members (Graen & Cashman, 1975). By accepting this situation, they made two basic assumptions about the leadership situation in managerial units. First, they assumed that some interlocked behaviors must be shaped early in the history of the vertical dyad linkage, e.g. critical tasks cannot be command of strangers or the consequences may harm the leader. Second, they assumed that some relationships must be developed carefully over an extended period of time, e.g. mutual trust must be earned by both parties. Therefore, they expected that early interaction between a leader and a member will emit signs which can be used to predict the nature of the emergent leadership structure – the leader-member exchange.

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Graen & Cashman (1975) studied 60 managers undergoing complete reorganization. While 50 percent of managers were in new positions and one-third were new to the organization; nearly 90 percent of the reporting relationships contained at least one new member. They studied the development of leader-member exchanges over nine-month period. The results formed a consistent network of reliable relationships. This network was quite consistent with the model: leaders do routinely differentiate their units by developing in-group exchanges with selected members and out-group exchanges with their remaining members. Furthermore, in addition to developing more effective relationships, members developing in-group exchanges with their leaders assume greater involvement in unit activities and receive greater positional resources from their leader than do their out-group colleagues. They observed that leaders of managerial units, when faced with the task of developing new working relationships with most of the members they lead, responded in manners which served to differentiate their units. Only some of their subordinate managers did leaders attempt to develop special exchange relationships which transcended the formal employment contract. All subordinate managers so selected may or may not have accepted such as a special exchange relationship. But, those who did consummate such an exchange promised to develop into members of the leader‘s trusted in-group. In contrast, those who either were not given the opportunity, or who declined the opportunity of the special exchange, became members of the leader‘s out-group. Thus, the units became differentiated over time into two distinct subgroups. In-group members received greater latitude in their roles, more inside information, greater influence in decision making, stronger support for their actions, and more consideration for their feelings than did members of the other groups. Out-group members received lower performance ratings and were confronted with more severe problems with their superiors than were members of other groups. They remarked that In-group members are characterized by stronger bonds of dyadic loyalty than those of out-group members. Ingroup members exhibit greater openness to ideas, more reciprocal support, and a higher propensity to protect one‘s partner than out-group members.

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2.11 Transformational Leadership Bass (1985) was the first one to contrast transactional with transformational leadership. The transformational leader motivates us to do more than we originally expected to do. He said that such a transformation can be achieved in these ways: raising our level of consciousness about the importance and value of designated outcomes and ways of reaching these outcomes; getting us to transcend our own self-interests for the sake of the team, or organization; raising our need level on Abraham Maslow‘s hierarchy from, say, the need for security to the need for recognition, or expanding our portfolio of needs by, for example, adding the need for self-actualization to the need for recognition. The need for more transformational leaders in business and industry was illustrated in an in-depth interview survey conducted by Bass (1985) covering national sample of 845 working Americans. The survey found that while most employees liked and respected their managers, they felt their managers really didn‘t know how to motivate employees to do their best. Although 70 % endorsed the work ethic, only 23 % said they were working as hard as they could in their jobs. Only 9% agreed that their performance was motivated by transaction; most reported that there actually was little connection between how much they earned and the level of effort they put into the job. In another study of interviewing 70 senior executives, he asked them to describe in detail a transformational leader whom they had encountered at any time during their career. According to him, the transformational leader induces members to work ridiculous hours and to do more than they ever expected to do. Respondents reported that they aimed to satisfy the transformational leader‘s expectations and to give the leader all the support asked of them. They wanted to emulate the leader. The transformational leader increased their awareness of and promoted a higher quality of performance and greater innovativeness. Such a leader convinced followers to extend themselves and to develop themselves further. Total commitment to and belief in the organization emerged as consequences of belief in the leader and heightened self-confidence. Many respondents indicated that the transformational leader they could identify in their own careers was like a benevolent father who remained friendly and treated the respondent as an equal despite the leader‘s greater knowledge and experience. The leader provided a model of integrity 30

and fairness, and also set clear and higher standards of performance. He encouraged followers with advice, help, support, recognition, and openness. He gave followers a sense of confidence in his intellect, yet was a good listener. He gave followers autonomy and encouraged their self development. He was willing to share his greater knowledge and expertise with them. Yet he could be formal and firm and would reprimand followers when necessary. Most respondents, however, were inclined to see the transforming leader as informal and accessible. Such a leader could be counted on to stand up for his subordinates. Along with the heightened and changed motivation and awareness, frequent reactions of followers to the transformational leader include trust, strong liking, admiration, loyalty, and respect. FIGURE 9 TRANSFORMATIONAL LEADERSHIP

Source: Bass, B. (1985). Leadership and performance beyond expectations. New York: Free Press. Furthermore, Bass in his study found that many followers described their military or industrial leader as someone who made everyone enthusiastic about assignments, who inspired loyalty to the organization, who commanded respect from everyone, who had a special gift of seeing what was really important, and who had sense of mission that 31

excited responses. Followers had complete faith in the leaders with charisma, felt proud to be associated with them, and trusted their capacity to overcome any obstacle. Charisma is the most important component in the larger concept of transformational leadership. Charismatic leaders served as symbols of success and accomplishment for their followers. The leader attracts intense feelings of love (and sometimes hatred) from his or her subordinates. They want to identify with the leader. The ability to inspire - arouse emotions, animate, enliven, or even exalt – is an important aspects of charisma. Inspirational leadership involves the arousal and heightening of motivation among followers. Followers can be inspired by a cold, calculating, intellectual discourse, the brilliance of a breakthrough, or the beauty of an argument. Yet it is the followers‘ emotions that ultimately have been aroused. Followers may hold an intellectual genius in awe and reverence, but the inspirational influence on them is emotional. Individualized consideration and intellectual stimulation are pillars of transformational leadership. Delegating challenging work and increasing subordinate responsibilities are particularly useful approaches to individual development. Personal influence and the one-on-one superior-subordinate relationship are of primary importance to the development of leaders. An organizational culture of individualism, even of elitism, should be encouraged; an organization should focus attention on identifying prospective leaders among subordinates. Individual consideration is reflected when a manager keeps each employee fully informed about what is happening and why-preferably in a two way conversation rather than a written memo. Employees come to feel that they are on the inside of developments and do not remain bystanders. Intellectual stimulation arouses in followers the awareness of problems and how they may be solved. It promotes the hygiene of logic that is compelling and convincing. It stirs the imagination and generates thoughts and insights. It is not the call to immediate action aroused by emotional stimulation. This intellectual stimulation is seen in a discrete leap in the followers‘ conceptualization, comprehension, and discernment of the nature of the problems they face and their solutions. The transformational leader may be less willing to accept the status quo and more likely to seek new ways of doing things while taking maximum advantage of opportunities. 32

2.12 Charismatic Leadership Weber (1947) described those leaders as charismatic who ‗reveal a transcendent mission or course of action which may be in itself appealing to the potential followers, but which is acted on because the followers believe their leader is extraordinarily gifted‘ (p. 358). This ‗gift‘ of charisma is seldom specified and generally held to be some mysterious quality that defies definition. In actuality, the ‗gift‘ is likely to be a complex interaction of personal characteristics, the behavior the leader employs, characteristics of followers, and certain situational factors prevailing at the time of the assumption of the leadership role. FIGURE 10 CHARISMATIC LEADERSHIP

Source: House, R. (1977). A 1976 theory of charismatic leadership, in Hunt, J.G. and Larson, L.L. (Eds.). The Cutting Edge , Southern Illinois University Press, Carbondale, IL.

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After studying literature on charismatic leadership, House (1977) made five propositions. First, he pointed out that the literature on charismatic leadership repeatedly attributes three personal characteristics to leaders who have charismatic effects. Those characteristics are extremely high levels of self-confidence, dominance, and a strong conviction in the moral righteousness of his or her beliefs. Second, the more favorable the perceptions of the potential follower toward a leader, the more the follower will model: (a) the valences of the leader; (b) the expectations of the leader that effective performance will result in desired or undesired outcomes for the follower; (c) the emotional responses of the leader to work related stimuli; (d) the attitudes of the leader toward work and toward the organization. Third, leaders who have charismatic effects are more likely to engage in behaviors designed to create the impression of competence and success than leaders who do not have such effects. Fourth, leaders who have charismatic effects are more likely to articulate ideological goals than leaders who do not have such effects. And, fifth, leaders who simultaneously communicate high expectations of, and confidence in followers are more likely to have followers who accept the goals of the leader and believe that they can contribute to goal accomplishment and are more likely to have followers who strive to meet specific and challenging performance standards.

2.13 Power and Leadership The process of power is pervasive, complex, and often disguised in our society. French & Raven (1959) tried to identify the major types of power and to define them systematically so that we may compare them according to the changes which they produce and the other effects which accompany the use of power. The phenomena of power and influence involve a dyadic relation between two agents who may be viewed from two points of view: (a) what determines the behavior of the agent who exerts power? (b) what determines the reactions of the recipient of this behavior? They distinguished five types of power: referent power, expert power, reward power, coercive power, and legitimate power. They went on to explain each power. Reward power is defined as power whose basis is the ability to reward. The strength of reward power increases with the magnitude of the rewards which follower perceives that a leader can mediate for him. Reward power depends on leader‘s ability to administer positive 34

valences and to remove or decrease negative valences. The strength of reward power also depends upon the probability that leader can mediate the reward, as perceived by the follower. Coercive power is similar to reward power in that it also involves leader‘s ability to manipulate the attainment of valences. Coercive power stems from the expectation on the part of follower that he will be punished by the leader if he fails to conform to the influence attempt. Thus negative valence will exist in given regions of follower‘s life space, corresponding to the threatened punishment by leader. The strength of coercive power depends on the magnitude of the negative valence of the threatened punishment multiplied by the perceived probability that follower can avoid punishment by conformity. Legitimate power is probably the most complex of those treated here. Legitimate power is defined as that power which stems from internalized values in follower which dictate that leader has a legitimate right to influence follower and that follower has an obligation to accept this influence. The researchers noted that legitimate power is very much similar to the notion of legitimacy of authority which has long been explored by sociologists. Cultural values, acceptance of social structure, designation are the basis for legitimate power. The referent power has its basis in the identification of follower with leader. By identification, the researchers mean a feeling of oneness of follower with leader, or a desire for such an identity. If leader is a person toward whom follower is highly attracted, follower will have a desire to become closely associated with leader. If leader is an attractive group, follower will have a feeling of membership or desire to join. This would mean that the greater the attraction, the greater the identification, and consequently the greater the referent power. The strength of expert power varied with the extent of the knowledge or perception which follower attributes to leader within a given area. Probably follower evaluates leader‘s expertness in relation to his own knowledge as well as against an absolute standard. Expert power will produce a new cognitive structure which is initially relatively dependent on leader, but informational influence will produce a more independent structure.

2.14 Servant Leadership Greenleaf (1977) coined the term servant as leader out of reading Herman Hesse‘s Journey to the East. In this story, he found a band of men on a mystical journey, probably 35

also Hesse‘s own journey. The central figure of the story is Leo who accompanies the party as the servant who does their menial chores, but who also sustains them with his spirit and his song. To him, the story clearly said that the great leader is seen as servant first, and that simple fact is the key to his greatness. He suggested that a new morale principle shall emerge which holds that the only authority deserving one‘s commitment is that which is freely and knowingly granted by led to the leader in response to, and in proportion to, the clearly evident servant stature of the leader. Those who choose to follow this principle will not casually accept the authority of existing institutions. Rather they will freely respond only to individuals who are chosen as leaders because they are proven and trusted servant. The servant leader is servant first and then leader. It begins with the natural feeling that one wants to serve, to serve first. Then conscious choice brings one to aspire to lead. He is sharply different from the person who is leader first, perhaps because of the need to assuage an unusual power drive or to acquire material possessions. For such it will be a later choice to serve – after leadership is established. The leader-first and the servant-first are two extreme types. Between them there are shadings and blends that are part of the infinite variety of human nature. The natural servant, the person who is servant first, is more likely to persevere and refine his hypothesis as per other‘s highest priority, than is the person who is leader first and who later serves out of prompting of conscious or in conformity with normative expectations.

2.15 Organizational Leadership The Fortune magazine said, ―Forget your old tired old ideas about leadership. The most successful corporation of the 1990s will be something called a learning organization.‖ As a world becomes more interconnected and businesses become more complex and dynamic, work must become more learningful. It is no longer sufficient to have one person learning for the organization, a Tata or a Birla or an Ambani. It‘s just not possible any longer to figure it out from the top, and have everyone else following the orders of the grand strategist. The organizations that will truly excel in the future will be organizations that discover how to tap people‘s commitment and capacity to learn at all levels in an organization (Senge, 1990). And, probably, that makes the job of leader more interesting and challenging. 36

Most organizations have a leadership deficit because they ignore leadership potential and don‘t offer training or relevant role models. In fact, we need more leaders who can help groups come up with visions that aren‘t self-serving – visions that serve entire enterprise (Kotter J. , 2005). Ready & Conger (2007) conducted a survey of human resources executives from 40 companies around the world in 2005, and virtually all of them indicated that they had an insufficient pipeline of high-potential employees to fill strategic management roles. The problem is that, while companies may have talent processes in place (97% of respondents said they have formal procedures for identifying and developing their next-generation leaders), those practices may have fallen out of sync with what the company needs to grow or expand into new markets. More than half the specialists who took part in the research had trouble keeping top leaders‘ attention on talent issues. Senior line executives may vigorously assert that obtaining and keeping the best people is a major priority—but then fail to act on their words. Another line of criticism of the heroic theme has been provided by writers such as Mintzberg (1999), who strongly challenged the concept of leadership residing in one individual, and contributing uniquely to organizational success, asserting that leadership, and importantly, learning from experience, is distributed throughout the organization. Stacey (1999) articulated the dangers of perpetuating the notion of leadership relating to ‗special powers‘ of certain individuals: the myth that organizations have to rely on one or two unusually gifted individuals to decide what to do, while the rest enthusiastically follow . . . [encourages] cultures of dependence and conformity that actually obstruct the questioning and complex learning which encourages innovative action. In recent years, the need to develop next-generation leaders — people who can translate strategy into results and core values into day-to-day behaviors — has become the paramount challenge for many chief executives and their top teams. But even though this issue has risen to the top of the agenda, most executives would be the first to admit that they are failing at the effort. And that‘s a significant admission, because they would also concur that their leadership ―inventory‖ is woefully insufficient. Unprecedented advances

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in information technology and jolting demographic changes revealed the scarcity of technical and leadership talent (Ready, 2002). For the past couple of decades, companies have focused on creating strong leaders of business units and influential heads of functions — men and women responsible for achieving results in one corner of an organization. But they have not paid as much attention to a more important challenge: developing leaders who see the enterprise as a whole and act for its greater good. And that perspective has become increasingly necessary as companies seek to provide not just products but broad-based customer solutions. It is imperative, then, for companies to be able to identify and develop enterprise leaders — people who can deliver differentiated value by bringing the total resources of their companies to their customers. In order to link strategy to leadership development, they must be able to answer three questions: What are the key elements of the enterprise leader‘s job? Why is learning to lead at the enterprise level such a difficult challenge? And what can companies do to identify and develop enterprise leaders (Ready, 2004)? After her research on Indian Businessmen, Piramal (1996) said that however talented, a businessman may still not achieve his individual pinnacle unless two outside forces come to his aid. For each businessman she studied, each at some point had a mentor who helped kick him upstairs. And at the first turning point in each of their careers, a piece of luck has come their way. In hindsight, often the lucky event seems trifling, of no major significance, but had it not been there, had they missed seeing opportunity and building on it, none of them would have got the jump-start enabling them to draw ahead of the crowd. Hemphill (1949) expressed its major theme in saying that ―there are no absolute leader, since successful leadership must always take into account the specific requirements imposed by the nature of the group which is to be led.‖ Calder (1977) said that leadership exists only as a perception. Leadership is not a viable scientific construct. It is, however, extremely important as naïve psychology. Ulrich & Smallwood (2007) argued that we needed to shift from studying leaders to studying leadership. It is easy to be enamored of great leader who has charisma, personality, emotional intelligence, and charm and who 38

delivers great results. Good leaders do not just build their personal credibility; they build the organization‘s leadership capability, or the capacity of the organization to sustain future leaders. They pointed out that as they explored the criteria of effective leadership; they realized that many firms had shifted to building leadership, but those that succeeded focused on how leaders inside the company connected a firm to the customers and investors outside the company. According to them, leaders and leadership is not the same thing. Focusing on the leader emphasizes the qualities of the individual and how he or she leads and engages others. A leader focus works on the knowledge, skills and values a leader demonstrates and works to help individuals become more proficient in their ability to direct others. Focusing on leadership emphasizes the quality of leaders throughout an organization, not just an individual leader and the systems and processes that create these leaders. Great individual leaders may come and go, but great leadership endures over time.

2.16 Organizational Commitment The second aspect of the study is to focus on organization commitment, and the core theory is based on Mowday, Steers, & Porter (1979) theory of organizational commitment. Their theory is widely cited by organizational commitment researchers. In addition, it is used as the core theory in other recent related research studies. Mowday, Steers, & Porter (1979) organizational commitment theory is based on the attitudinal commitment construct. In the literature, there are a wide variety of definitions for organizational commitment. Mowday et al. (1982) state that there is disgreement in the literature regarding the construct definition of commitment. The central issue of the debate is whether to classify commitment as an attitude or a behavior. They suggest that attitudinal commitment is the employee‘s identification with the goals and values of the organization and a desire for organizational membership. Behavioral commitment is the process by which employees become bound or linked to the organization from past actions. They describe attitudinal and behavioral commitment as follows: Attitudinal commitment focuses on the process by which people come to think about their relationship with the organization. In many ways, it can be thought of as a mind set 39

in which indibiduals consider the extent to which their own values and goals are congruent with those of the organization. Behavioral commitment, on the other hand, relates to the process by which individuals become locked into a certain organization and how they deal with this problem. The study of attitudinal commitment usually involves the measurement of commitment as a mind-set or an attitude, along with other variable antecedents and consequences of commitment. Mowday et al. (1979) suggest the following definition of organizational commitment: The relative strength of an individual‘s identification with and involvement in a particular organization. Conceptually, it can be characterized by at least three factors: (a) strong belief in and acceptance of the organization‘s goals and values; (b) a willingness to exert considerable effort on behalf of the organization; (c) a strong desire to maintain membership in the organization. The central theme of this definition is the identification with the organization. Commitment is the linkage between the employee and the organization. This linkage helps identify the outcomes or consequences of organizational commitment: absenteeism, job performance, tardiness, and turnover. Commitment involves an active relationship with the organization in which individuals are willing to give of themselves in order to help the organization succeed and prosper.

2.17 Research Gap in the Area of Leadership The success of any organization depends on its leadership. Although a good deal of research has been done on leadership, it is difficult to say what it is (Rastogi, 1987). Investment in leadership education and development by corporation became increasingly popular, reaching more than $50 billion across the world in 2000 (Ready & Conger, 2003). Yet, the advice given to managers about leadership and leader development is often overly complex and sometimes contradictory (Sleeth & Johnston, 1996).

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Leadership is one of the most complex and multifaceted phenomena to which organizational and psychological research has been applied. While the term "leader" was noted as early as the 1300s and conceptualized even before biblical times, the term leadership has been in existence only since the late 1700s (Stogdill R. , 1974). Even then, scientific research on the topic did not begin until the twentieth century (Bass B. M., 1985). Since that time, however, there has been intensive research on the subject. Indeed, Bennis (1959) stated that of all the hazy and confounding areas in social psychology, leadership theory undoubtedly contends for the top nomination. And, ironically, probably more has been written and less known about leadership than about any other topic in the behavioral sciences (p 259). Burns (1978) similarly remarked that leadership is one of the most observed and least understood phenomena on earth. This problem arises not only in understanding the operation of the theory but even in its definition. Stogdill (1974) claimed that there are almost as many definitions of leadership as those who have attempted to define the concept. In an effort to capture some of the complexity, leadership scholars and practitioners since about 1910 have tried to develop reality based understanding of leadership in groups, organizations, and societies. There has been great deal of fumbling. On the surface, these attempts to define leadership have been confusing, varied, disorganized, idiosyncratic, muddled, and according to conventional wisdom, quite unrewarding. These scholars have not provided a definition of leadership that is clear, concise, understandable by scholars and practitioners, researchable, practically relevant, and persuasive. In issuing such challenges, these people are calling for a new school of leadership. They are involved in a paradigm shift which changes our understanding of leadership so that it makes sense in a rapid changing world (Rost, 1991). The insights into motion and the structure of the universe that we associate with Galileo Galilee, and the understandings of light and gravity that emanated from Isaac Newton, created a body of knowledge that continues to accumulate at an ever accelerating rate. In the biological sciences, a similar trend has occurred in the past 150 years, building on Charles Darwin‘s formulations about evolution and the ensuing discoveries of Gregor Mendel, James Watson, and Francis Crick in genetics. While slight differences may obtain in how these sciences are practiced across different labs, countries, or continents, 41

essentially there is only one mathematics, one physics, one chemistry, and one biology. Having solved major mysteries about the physical and the biological worlds, scientists and technologists have more recently turned their attention to the understanding of the human mind and brain. More knowledge about psychology and neuroscience has been accrued in the past fifty years than in all prior historical eras combined. We now have well-developed, empirically based theories of intelligence, problem solving, and creativity—along with the tools, software, and hardware based on these scientific advances. Educators, professionals, managers, and leaders in business need to be cognizant of what has been established, and what may soon be established, about the nature, workings, potentials, and constraints of the human mind (Gardner H. , 2008). Despite that, attempts to analyze leadership tend to fail because the would-be analyst misconceives his task. He usually does not study leadership at all. Instead he studies popularity, power, showmanship, or wisdom in long-range planning. Some leaders have these things, but they are not of the essence of leadership. Human beings are not machines with a single set of push buttons (Prentice, 1961). Despite many thousands of theoretical and empirical studies, leadership remains a tantalizing enigma for thinkers and practitioners. Despite many thousands of studies there are still no generally agreed definitions, and the mountains of accumulated data and ideas seem to have brought us no nearer to a detailed understanding of what the concept means. If the copious leadership literature reveals a consistent theme, it is the lack of effort toward integration. Leadership occurs in situation and cannot be distilled into a number of constituent elements - other than perhaps for descriptive processes (Bolden, Wood, & Gosling, 2006). Explaining with musical metaphor, a competency framework could be considered like sheet music, a diagrammatic representation of the melody. It is only in the arrangement, playing and performance, however, that the piece truly comes to life. Simply being able to read music or play particular notes does not make someone an excellent musician and nor does one‘s ability to play solo necessarily ensure that they can be an effective member of a group or orchestra. Likewise being a successful classical musician, for example, is no guarantee that someone will be able to transfer their talent to different musical genres such as jazz, folk or rock. Thus, while a competency framework 42

may be a useful guide to how the melody may sound, if we focus too closely on the written music we may miss the most interesting and significant features of the performance, producing only sterile renditions devoid of emotion (Bolden & Gosling, 2006). Pondy (1978) calls leadership a ‗language game‘ whereby, through the effective use of rhetoric and ‗framing‘ (Conger J. , 1991; Fairhurst, 2005; Fairhurst & Sarr, 1996), leaders can shape the understanding of others - often termed ‗followers‘. Bennis (1993) proposed that ‗effective leaders put words to the formless longings and deeply felt needs of others. They create communities out of words‘. Likewise, Cuno (2005) proposed that ‗one often hears that leaders lead through action, by example. But more often, and often more effectively, leaders lead through their words, by acts of speech, as it were‘. For the later part of the 20th century, the impact of the rationalistic and mechanistic perspective was very strong in both leadership theory and practice (Tsoukas & Cummings, 1997; Weick, 1969). Over time, insistence on objective standards and strict rules was replaced by unconventional and creative approaches. Contingency theories (Fiedler, 1964; Hunt & Osborn, 1982; Vroom V. , 1964; Vroom & Yetton, 1973; Yukl, 1989) linked the leader‘s skills with the demands of a particular situation. Transactional and exchange theories (Kelley & Thibaut, 1978) on the other hand, are concerned with the leader–follower relationships. Cognitive approaches (Shaw & Costanzo, 1982) shed light on perception and judgment. Visionary leadership is necessary but not a sufficient condition. One requires set of difficult choices to make, pursue opportunities in the most competitive markets of the world, willingness to learn and critically invest in developing the requisite competencies. The pattern of engaging with the most competitive markets of the world and display of the willingness to learn and invest in building the necessary competencies is discernible across this new genre of companies (Ramachandran, Khorakiwala, Rao, Khera, Dawar, & Kalyani, 2004). While generalized definitions and disparate theories abound, it is difficult to find a useful operational definition and an integrative framework of leadership (Muczyk & Adler, 2002). They argue that to present a coherent and unified scheme of leadership, several vexing issues need to be addressed. First, leadership has been discussed at various level of abstraction, from the ―Great Man/Woman‖ approach to micro leader behaviors, and 43

every level in between. Second, some leadership theories are of a normative variety (one best leadership approach for all situations) while others are of a situational or contingency character (leadership styles fashioned to suit the attributes of the leader, characteristics of subordinates, and circumstances of the situation). Third, leadership construct has been disaggregated into different constituent components by different theorists, and reconciliation would be most welcome. Fourth, the whole controversy of whether or not leaders are born versus made needs to be confronted. Fifth, what are the substitutes for leadership, and when is leadership important? Sixth, just how much of leadership construct overlaps other organizational behavior constructs, and what to do about it? They went on to add that most of the leadership studies have been conducted on ad hoc groups. It may be that results from these studies should not be generalized to leadership in actual organizations, where leaders hold their positions for much longer and the consequences of leader behavior are much more serious. Various camps are concerned with important but entirely difficult aspects of leadership. Each camp, however, represents the dimension of leadership with which it is preoccupied as a complete leadership theory. Decades of academic analysis have given us more than 850 definitions of leadership. Literally thousands of empirical investigations of leaders have been conducted in the last seventy-five years alone, but no clear and unequivocal understanding exists as to what distinguishes leaders from nonleaders, and perhaps more important, what distinguishes effective leaders from ineffective leaders and effective organizations from ineffective organizations. Multiple interpretations of leadership exist, each providing a slice of insight but each remaining incomplete and wholly inadequate explanation. Most of these definitions don‘t agree with each other, and many of them would seem quite remote to the leaders whose skills are being dissected. Definitions reflect fads, fashions, political tides and academic trends. Bennis & Nanus (1985) went on to say that these definitions don‘t reflect reality and sometimes they just represent nonsense. Like love, leadership continued to be something everyone knew existed but nobody could define. Many other theories of leadership have come and gone. Some looked at the leader. Some looked at the situations. None has stood the test of time (p.5).

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Students are confronted with the issue that if leadership is a competency, that is, if leadership can be learned, then which theories make the most sense to learn and how can these theories then be taught as foundations for decisions affecting leadership behavior and actions. Leadership theories would have little value if they could not be applied to real world situations (Armandi, Oppedisano, & Sherman, 2003). It is becoming increasingly clear that experience is the best teacher of leadership. In an Accenture study of leaders under the age of 35 and over the age of 70, entrepreneurs, corporate executives, social activists and elected politicians unanimously agreed that they had learned more about leading from real work and life experiences than from leadership development courses or MBA programs. They credited the latter with helping them become more competent technically, but they argued that formal programs do little to help people learn fundamental lessons or how to extract wisdom from experience (Vey, Stergios, & Thomas, 2005). A typical CEO of a major firm might interact on a typical day with 20 out of, say, 50,000 employees. That being the reality, there is no way that such a person through personal contact – a daily reality in small firms – can influence or lead people directly. We have developed generations of executives who know much more about management than they do about leadership (Kotter J. , 1998). In studies of leadership behavior, there has historically been a belief of a universal manager who could adapt to any situation (Bass B. M., 1985). Bolman & Deal (1997) advocated that successful leaders consider the broader view of the context in which they work. When determining success or effectiveness of leader, if we were to focus only on the leader who may be perceived as ineffective, overlooking the many tensions and dynamics interacting to create this perception of the ―ineffective leader,‖ we would not be considering all pertinent information and we would not have taken the broad view of contextual factors into consideration. Rather than condenming the current multiple paradigm approach to leadership and searching for a single grand theory, perhaps what is needed is more concpetual work concerning the exact domain of existing leadership theories. That is, although a given theory may not be able to be all things to all people, it

may provide a valuable

framework for dealing with certain aspects of the phenomenon in question (McElroy, 45

1982). Some leadership theories seek to clarify the construct of leadership by examining what leadership consists of (e.g. traits, behaviors). Others are more concerned with the process of leadership; that is, how leaders decide what action to take and the impact of those actions on others (e.g. the path goal model). After going through above arguments in the area of leadership, researcher wanted to take a dip into the ocean, by exploring himself through extracting a small amount of knowledge. Researcher selected Bass (1985) model of leadership, which is explained in detail in subsequent chapter, for research purpose. He explored the subject of leadership to study its relationship with subordinate organizational commitment, extra effort, effectiveness, and satisfaction.

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CHAPTER 3: RESEARCH METHODOLOGY 3.1 Introduction The introduction and literature review chapters described different theories of leadership. Here in this chapter, along with research methodology, we have explained the conceptual model of leadership, based on the work of Bass (1988). This chapter presents information on the methodology used for the research, the measuring instruments, their source of origin with validity and reliability estimations, hypothesis and data collection process.

3.2 Objectives of the Study The objective of this study is to examine the relationships between three leadership styles (transformational, transactional, and laissez-faire) and subordinate organizational commitment along with subordinate extra effort, effectiveness, and satisfaction. The specific objectives of the study are: 1. To understand perceived leadership style demonstrated by leaders 2. To understand the relationship of perceived leadership style with subordinate organizational commitment 3. To understand the relationship of perceived leadership style with subordinate extra effort 4. To understand the relationship of perceived leadership style with subordinate effectiveness 5. To understand the relationship of perceived leadership style with subordinate satisfaction 6. To explore above relationships at multiple levels, i.e. for total responses collected, for three different samples, for different companies in one sector

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3.3 Hypotheses of the Study The following null hypotheses were formed in line with above objectives for the study: Hypothesis 1: The actual leadership style tends to be more transactional than transformational. Hypothesis 2: Laissez-faire leadership style is not a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment. Hypothesis 3: Transactional leadership style is not a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment. Hypothesis 4: Transformational leadership style is not a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment. Hypothesis 5: Leadership factors are not significantly explanatory variables for subordinate extra effort. Hypothesis 6: Leadership factors are not significantly explanatory variables for subordinate effectiveness. Hypothesis 7: Leadership factors are not significantly explanatory variables for subordinate satisfaction. Hypothesis 8: Leadership factors are not significantly explanatory variables for subordinate organizational commitment. Hypothesis 9: There is no significant difference in laissez-faire leadership style shown by leaders across three different samples. Hypothesis 10: There is no significant difference in transactional leadership style shown by leaders across three different samples. Hypothesis 11: There is no significant difference in transformational leadership style shown by leaders across three different samples. Hypothesis 12: There is no significant difference in subordinate extra effort across three different samples.

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Hypothesis 13: There is no significant difference in subordinate effectiveness across three different samples. Hypothesis 14: There is no significant difference in subordinate satisfaction across three different samples. Hypothesis 15: There is no significant difference in subordinate organizational commitment across three different samples. Hypothesis 16: There is no significant difference in laissez-faire leadership style shown by leaders across four companies in Insurance Sector. Hypothesis 17: There is no significant difference in transactional leadership style shown by leaders across four companies in Insurance Sector. Hypothesis 18: There is no significant difference in transformational leadership style shown by leaders across four companies in Insurance Sector. Hypothesis 19: There is no significant difference in subordinate extra effort across four companies in Insurance Sector. Hypothesis 20: There is no significant difference in subordinate effectiveness across four companies in Insurance Sector. Hypothesis 21: There is no significant difference in subordinate satisfaction across four companies in Insurance Sector. Hypothesis 22: There is no significant difference in subordinate organizational commitment across four companies in Insurance Sector.

3.4 Research Design and Sampling This study used an exploratory research design using three independent samples to determine the relationship of transactional, transformational and laissez-faire leadership style with subordinate organizational commitment, extra effort, effectiveness, and satisfaction. As a correlation study, this research also described relationships between independent variables (idealized influence - attributed, idealized influence - behavior, individual consideration, inspirational motivation, intellectual stimulation, contingent reward, management by exception - active, management by exception - passive) with dependent variables (subordinate organizational commitment, extra effort, effectiveness, and satisfaction). 49

There are three independent variables (a) transactional leadership, (b) transformational leadership, and (c) laissez-faire leadership. There are four dependent variables (a) subordinate organizational commitment, (b) subordinate extra effort, (c) subordinate effectiveness, and (d) subordinate satisfaction. This exploratory study attempted to establish a relationship between these variables. The researcher collected data from three independent samples, faculty members of business schools (B-Schools) in Gujarat (to study leadership styles of their directors), employees of State Bank of India (to study leadership styles of branch managers), and sales managers of four private life insurance companies (to study leadership styles of branch managers). All above profiles play critical role for successful growth of respective organization, leading to performance of their subordinates, resulting to overall trajectory of organizational progress.

3.5 Scope of Study The data is collected from three independent samples through Multifactor Leadership Questionnaire and Organizational Commitment Questionnaire. The researcher was interested to learn the relationships of different leadership styles with subordinate outcomes for different profiles, from different samples. To understand the dynamic correlation between these factors, two samples were selected from corporate world (banking and insurance industry) and one sample was selected from academia (BSchools). That was to find any similarity or difference in leadership styles among various segments and their relationships with subordinates‘ outcomes. The researcher collected responses from 162 subordinates of 28 branch managers of State Bank of India, 179 subordinates of 18 branch managers of insurance companies, and 38 subordinates of 10 directors of business schools in Gujarat. While collecting data from respondents, two criteria were considered: a leader must be associated with the position for at least one year, and the follower shall have worked under that leader for at least one year. In total, the researcher studied responses from 379 subordinates of 56 leaders from cross-segments.

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3.6 Measuring Instruments The researcher used two measuring instruments for the study: Multifactor Leadership Questionnaire – Form 5X, and Organizational Commitment Questionnaire. The details of those questionnaires are given below. 3.6.1 Multifactor Leadership Questionnaire – Form 5X Burns (1978) introduced the constructs of transforming and transactional leadership as a single continuum with the former at one end and latter at the other. Early empirical studies showed these two leadership constructs could appear independently of each other, providing evidence for at least two separate leadership dimensions. However, the best of leaders typically displayed both transformational and transactional leadership, as evidenced by the positive correlations between ratings of these two leadership styles (Bass & Avolio, 1993). Bass (1985) conceptualized transactional and transformational leadership with seven leadership factors, which he labeled charisma, inspirational, intellectual stimulation, individualized consideration, contingent reward, management-by-exception and laissezfaire leadership. In subsequent writings (Bass B. , 1988), he noted that although charismatic and inspirational leadership were unique constructs, they were often not empirically distinguishable, this reducing his original model to six factors. The authors went on to address the concerns with earlier versions of the multifactor leadership questionnaire (MLQ), including problems with item wording, lack of discriminant validity among certain leadership factors, and the incorporate of behaviors and attributions in the same scale. The authors were also interested in examining whether a revised version of the MLQ would produce a more stable and replicable factor structure. The development of Bass‘ six-factor leadership model was originally based on preliminary results obtained by surveying 198 US Army field grade officers, who were asked to rate their respective superior officers using MLQ (Form 1). Six factors including three transformational, two transactional and a passive avoidant/laissez-faire factor were extracted from principal components analyses using varimax rotation. The five leadership

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factors and laissez-faire factor reported by Bass (1985) included charismatic-inspirational leadership, intellectual stimulation, individualized consideration, contingent reward, management-by-exception and laissez-faire leadership. He also provided evidence for two higher-order factors which he labeled active vs. passive leadership. One consistent problem raised by many authors using the MLQ survey was whether the components of transformational leadership should be considered independent of contingent reward leadership, and/or whether contingent reward leadership should be viewed as a separate factor. Many authors argued that the components of transformational leadership could not be distinguished empirically. Hater & Bass (1988) offered further refinements to the MLQ survey, indicating that management-by-exception could be split into two sub-factors: active vs. passive. The conceptual basis for the original factor structure for the MLQ began with Burns‘ description of transforming leadership. Bass (1988) asked seventy-eight executives to describe a leader who had influenced what was important to them in their roles as leaders, and how they thought the best leaders were able to get others to go beyond their own selfinterests for the good of the group. The original 142 items generated were sorted by 11 judges into transformational and transactional contingent reward leadership categories. An item was retained only if there was at least 80 percent agreement about the item. The final set of 73 items was evaluated by 176 US Army colonels who were asked to describe their superiors. Their ratings were then factor analyzed using principal components analysis into three transformational, two transactional, and a passive-avoidant laissezfaire factor (Bass B. M., 1985). Hater & Bass (1988) factor analyzed a revised version of the MLQ (Form 4R) splitting management-by-exception into active and passive subcomponents. Charisma and inspirational leadership were scored as two components of the same factor. They attempted to differentiate attributed from behavioral leadership in the latest version of MLQ. They developed scales that included behavioral items. The MLQ (Form 5X) survey, used in the current study, contained behavioral items for all scales, except the charismatic scale.

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Multifactor Leadership Questionnaire - Form 5X, includes 45 items, to assess transactional, transformational and laissez-faire leadership factors. This measuring tool has been previously validated (Bass & Avolio, 1997; Avolio, Bass, & Jung, 1999). The MLQ – Form 5X consists of 45 questions using 5 point Likert scale, wherein 36 questions represents the nine leadership factors and rest assess subordinate outcomes. Out of 9 questions, 3 questions assess subordinate extra effort, 4 questions for subordinate effectiveness, and 2 questions assess subordinate satisfaction. They noted that MLQ – Form 5X measures the full range model of leadership for small groups, large organizations, and leadership movements and societies. In the MLQ – Form 5X, respondents are asked to ―judge how frequently each statement fits the person you are describing‖ using a 5-point rating scale (0=not at all, 1=once in a while, 2=sometimes, 3=fairly often, 4=frequently, if not always). The MLQ – Form 5X assesses leadership style by averaging the scores for each leadership scale. The leadership style with the highest value represents the predominant perceived leadership style for the subordinate under survey. The MLQ – Form 5X needs to be administered among subordinates of the leader under study. The MLQ – Form 5X assesses leadership in both business and non-business environments. MLQ – Form 5X is a shorter version than was what originally developed but is more valid (Avolio, Bass, & Jung, 1999). The MLQ – Form 5X data can be derived further into aggregate data for transformational, transactional, and leadership outcomes. In addition, one can examine the individual scores for each leadership style and leadership outcomes. The questions for extra effort, satisfaction and effectiveness are incorporated in the MLQ. There are five components of transformational leadership style, and three components of transactional leadership styles described by Avolio, Bass, & Jung (1999). Components of Transformational leadership style: 1. Idealized Influence (Attributes and Behaviors): The leader is admired, respected, and trusted; followers identify with and want to emulate the leader; the leader considers followers‘ needs and shares risks with them. Four 53

questions (10, 18, 21, and 25) in MLQ – Form 5X formed Idealized Influence – Attributes and four questions (6, 14, 23, and 34) formed Idealized Influence –Behavior. 2. Inspirational Motivation: This factor refers to leaders who inspire or motivate followers to reach ambitious goals, by raising followers‘ expectations, and communicating confidence that followers can achieve lofty goals. Four questions (9, 13, 26, and 36) in MLQ – Form 5X formed this factor. 3. Intellectual Stimulation: The leader questions the status quo and appeals to followers‘ intellect, and invites innovative and creative solutions to problems. To bring forth the expert knowledge of the members of the organization, thinking is stimulated at all levels about the organization‘s objectives and the means to meet them. Airing of problems is encouraged. Stories about successful problem solving are passed on. Mechanisms for upward communication are developed. Creativity, innovation, calculated risk-taking, and careful experimentation are fostered. The leader provides an environment that encourages followers to challenge the status quo in the quest to continually improve the overall organization. Leaders and followers openly exchange high expectations, by creating a vision that demands higher standards. Four questions (2, 8, 30, and 32) in MLQ – Form 5X formed this factor. 4. Individual Consideration: The leader considers each individual‘s needs for achievement and growth by acting as a coach and mentor; the leader creates new learning opportunities with a supportive climate in which to grow; and individual needs and differences are recognized. Individually considerate leaders take part in more developmental activities. They treat each individual follower as having different developmental needs. They give and accept feedback as part of the learning process. They provide mentoring and coaching. The leader recognizes that each follower is an individual with individual needs to be developed within the organization. Followers are provided the opportunity for personal attention and learning 54

opportunities to develop higher levels of potential that will positively affect the organization. Four questions (15, 19, 29, and 31) in MLQ – Form 5X formed this factor. The transactional factors measured by the MLQ are as described below: 1. Contingent Reward: This factor is based on economic and emotional exchanges by clarifying role requirements, and rewarding and praising desired outcomes. To foster organizational learning, changes are introduced into the daily practices of the organization, following suitable education and training efforts. Individuals and departments are praised, publicized and earn promotions and pay increases for trying and succeeding in introducing learning approaches into their everyday activities. Sometimes, even failing after trying is rewarded. Four questions (1, 11, 16, and 35) in MLQ – Form 5X formed this factor. The interaction of the leader and follower focuses on the exchange of what is expected and what is desired. Exchanges include acknowledgement of completed tasks and additional responsibilities within the organization. Exchanges are generally positive, but may be negative in the form of punishment. 2. Management- by-Exception – Active: The leader establishes the criteria for compliance and non-compliance; the leader may punish followers for non-compliance; the leader closely monitors for deviances, mistakes, and errors and takes corrective action as quickly as possible. Wherever possible, leaders at all levels are encouraged to practice transformational leadership and contingent reward in dealing with problems that arise. However, when this is not possible, they may use Active Management by Exception. They monitor their subordinates‘ performance and provide corrections, as needed. The leader monitors activities for irregularities and failures that have occurred or may occur. Four questions (4, 22, 24, and 27) in MLQ – Form 5X formed this factor.

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3. Management by Exception – Passive: Contradicted to organizational learning is a leader waiting for problems to surface, i.e. passive managing-by-exception or abdicating the leadership role as in laissez-faire leadership. For organizational learning, a leader needs to be more proactive. The leader allows the status quo to continue without addressing weakness within the organization. Reinforcement, when used, is in the form of criticism and negative feedback. Four questions (3, 12, 17, and 20) in MLQ – Form 5X formed this factor. Laissez-faire: The leader avoids making decisions, avoids getting involved in important issues, and delays responses to urgent issues. Four questions (5, 7, 28, and 33) in MLQ – Form 5X formed this factor. The non-leadership factors measured by the MLQ are described below: 1. Subordinate Extra Effort: Individuals attempt to do more than is expected and have a strong desire to succeed and try harder. Three questions (39, 42, 44) in MLQ – Form 5X formed this factor. 2. Subordinate Effectiveness: The job-related needs of the work unit (individual and/or group) are met; the leader effectively represents his or her group to higher authority, and the individual and/or group meets and surpasses their organizational goals. Four questions (37, 40, 43, and 45) in MLQ – Form 5X formed this factor. 3. Subordinate Satisfaction: Individuals are satisfied with the leader and his or her leadership approaches. Two questions (38 and 41) in MLQ – Form 5X formed this factor.

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3.6.2 Validity & Reliability of Multifactor Leadership Questionnaire – Form 5X The scale used in the MLQ – Form 5X have been found to be reliable and valid (Bass & Avolio, 1997; Avolio, Bass, & Jung, 1999). Bass & Avolio (1995), based on their assessment of reliability on a review of nine empirical studies that used the MLQ – Form 5X, found high reliability with assessment of outcomes. Lowe, Kroeck, & Sivasubramaniam (1996) found strong correlations between individual leadership factors and transformational and transactional leadership styles. Avolio, Bass, & Jung (1999) also noted the goodness of fit index and reliabilities of the total items and for each individual factor ranged from 0.74 to 0.94. They also noted that the reliabilities in each data set of the MLQ – Form 5X were reliable for the leadership style factors. Similarly, the MLQ – Form 5X was found to have high reliability as measured by Cronbach‘s alpha, which for each factor ranged from 0.67 to 0.93. In assessing the validity and the reliability of the MLQ – Form 5X, this researcher also found that it represented the full range of leadership factors, with Cronbach‘s alpha as 0.896. Given the reliability of the scale, this survey tool has been determined to be appropriate for the study. 3.6.3 Organizational Commitment Questionnaire The researcher used Organization Commitment Questionnaire (OCQ), devised by (Mowday, Steers, & Porter, 1979). The OCQ was selected to measure organizational commitment because of its high levels of internal consistency and reliability. Past studies prove reliability and validity of OCQ (Mowday, Steers, & Porter, 1979; Allen & Meyer, 1990). Mowday, Steers, & Porter (1979) originally used a sample population of 2,563 employees working in nine different organizations, including public and private organizations, for the OCQ validation. Employees responded to 15 questions using a 5point, Likert scale with responses of strongly disagree, somewhat disagree, neutral, somewhat agree, and strongly agree. Questions were assigned a value from 1 to 5 (strongly disagree = 1; strongly agree = 5) for scoring. Six of the 15 questions were negatively phrased and reverse scored to reduce response bias. The researcher found Cronbach‘s alpha for OCQ as 0.741.

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3.7 Limitation of Proposed Study The researcher was interested to learn the relationship of different leadership styles with subordinate extra effort, effectiveness, satisfaction, and organization commitment. The researcher came across multiple obstacles in various forms during data collection. Major public and private sector banks denied to participate in the research process, and the researchers were asked not to collect the response, not even on the condition of anonymity. The insurance companies granted researcher permission on the condition of anonymity, and subject to classification of data in a collective manner. In case of collecting data from B-Schools in Gujarat, the researcher found few institution having full time directors. Since, the response was supposed to be collected from those subordinates who have minimum one year of experience with the leader that minimized the response rate. The above criteria, in fact, reduced the sample population as well. The study assumed that responses received from the subordinates to be reliable and honest in nature.

3.8 Data Collection Procedure The questionnaire along with introductory letter was sent to the leaders in three different segments. In case of Ahmedabad, the researcher went personally to collect the responses. In case of outstation respondents, the questionnaire along with introduction letter and reply cover (with postage) was sent to the respective branch manager (director in case of B-School). As the researcher got permission from State Bank of India, he sent the permission letter along with the prior mentioned set. But, the response from outstation branches was very poor. The researcher first approached the respective leader and discussed about the objectives of the study. And in turn, the branch manager was asked to circulate the questionnaire to get responses from subordinates. The researcher administered the questionnaire with the help of the branch managers and director of BSchool to their respective subordinates.

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3.9 Summary This chapter summarizes the research methodology with sample selection for the study. The researcher used Multifactor Leadership Questionnaire – Form 5X, along with Organizational Commitment Questionnaire. MLQ – Form 5X is used to measure three different leadership styles, transactional, transformational, and laissez-faire leadership, along with subordinate outcomes, i.e. extra effort, effectiveness, and satisfaction. Organizational Commitment Questionnaire measures the subordinate organizational commitment. The researcher selected three different segments to understand different relationship between leaderships styles with subordinate outcomes. The total responses from 379 respondents of 56 leaders were collected from three different sectors. The research is in exploratory in nature and conventional sampling was used. The results from this study are expected to help organizations to understand relationships of leadership styles and its impact on subordinate performance, which can be further studied for organizational performance.

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CHAPTER 4: ANALYSIS OF DATA 4.1 Introduction The population for this study included the leaders and their subordinates across various segments, having different profiles. The researcher adopted convenience based judgmental sampling from State Bank of India, four companies in insurance sector, and ten B-Schools in Gujarat. The researcher collected the responses in person from his own city, and sent questionnaire along with request letter, self addressed stamped envelope to other cities in Gujarat. The responses from leaders of other cities were found very poor. The companies in insurance sector allowed the research to administer the questionnaire on the condition of anonymity. The detail of the sample presentation is given below in Table 1. The researcher found nearly 5 per cent of the responses incomplete, which he did not consider in the analysis, as there was no chance of getting them complete due to nature of anonymity of the respondents. Table 2 provides demographic information about leaders across three different samples. From the table, we can clearly say that the leaders‘ age in case of State Bank of India is much higher than that of companies in insurance sector and business schools. We found directors of business schools to be Ph.D. holders, while most of the branch managers of State Bank of India were graduates. In case of insurance companies, we found their branch managers having master degrees. We found higher leaders‘ total experience in State Bank of India than other two samples. That was again true for leaders‘ association with respective organization as well. TABLE 1 SAMPLE REPRESENTATION NATURE OF SAMPLE State Bank of India (Branch Managers) Insurance Companies (Branch Managers) Company A Company B Company C Company D B-School (Directors) Total

NO. OF LEADERS 28

NO. OF SUBORDINATES (RESPONDENTS) 162

5 6 4 3

48 60 39 32

10 56

38 379

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TABLE 2 DEMOGRAPHIC REPRESENTATION OF SAMPLE

LEADER ASSOCIATI ON WITH NATURE

LEADER

LEADER

OF

EDUCATIONAL

TOTAL

SAMPLE* Bank

Insurance

B-School

Total

QUALIFICATION EXPERIENCE Mean N Std. Deviation Mean N Std. Deviation Mean N Std. Deviation Mean N Std. Deviation

CURRENT ORGANIZA LEADER TION

GENDER

LEADER AGE

1.18 162

26.8025 162

23.7315 162

1.00 162

4.14 162

.385

5.69607

8.78578

.000

.585

2.26 179

15.8994 179

6.1285 179

1.00 179

2.79 179

.552

3.14642

1.54346

.000

.406

3.00 38

20.3947 38

6.3158 38

1.00 38

3.92 38

.000

6.02939

2.64172

.000

.273

1.87 379

21.0106 379

13.6715 379

1.00 379

3.48 379

.781

6.98751

10.50892

.000

.811

*Scale Description is given below for each parameter: Leader Education Qualification:

1: Graduate; 2: Master, 3: Doctor, 4: Any other

Leader Total Experience:

Number in years

Leader Association with Current Organization:

Number in years

Leader Gender:

1: Male, 2: Female

Leader Age:

1: < 25, 2: 25-34, 3: 35-44, 4: 45-54, 5: >54

61

The study sought to examine the relationships among different leadership styles with subordinate organizational commitment, extra effort, effectiveness and satisfaction. The researcher identified subordinate organizational commitment, extra effort, effectiveness, and satisfaction as dependent variables. For better understanding, the researcher named leadership styles as independent variables of level 1. The leadership factors, which resulted into leadership styles (the description of which was given in earlier chapter), were defined as independent variables of level 2 (refer Table 3). The researcher studied the relationship of independent variables of level 1 and 2 with dependent variables. The researcher also tried to study the relationship of independent variables and dependent variables for three independent samples, and explored for similarities or differences among their relationships with each others. The test of ANOVA was applied to understand the statistical closeness of scores for independent and dependent variables for different samples. Multiple regression technique was used to understand the relationship of multiple independent variables with dependent variables. The researcher tried to test relationships of leadership styles with subordinates‘ outcomes across different companies in one industry. The objective of the study was to explore the relationships of leadership styles with subordinates‘ outcomes at different levels; for entire sample of 379 respondents, for three independent samples from banking, insurance and B-Schools each, and for 4 independent samples from insurance sector (refer Table 4). TABLE 3 INDEPENDENT VARIABLES & DEPENDENT VARIABLES: INDEPENDENT VARIABLES LEVEL 2 Idealized Influence – Attributed Idealized Influence – Behavior Inspirational Motivation Intellectual Stimulation Individual Consideration Contingent Reward Management by Exception – Active Management by Exception – Passive

INDEPENDENT VARIABLES LEVEL 1 Transformational Leadership

DEPENDENT VARIABLES Subordinate Extra Effort Subordinate Effectiveness Subordinate Satisfaction

Transactional Leadership

Subordinate Organizational Commitment

Laissez Faire Leadership

Laissez Faire Leadership

62

TABLE 4 SIX STEP ANALYSIS STEP Step 1 For 56 leaders & 379 Subordinates

Step 2 : For each sample representation independently

Step 3: Comparative Analysis for Independent Variables between Three Samples (Bank, Insurance, B-School) Step 4: Comparative Analysis for Dependent Variables between Three Samples (Bank, Insurance, B-School) Step 5 Comparative Analysis for Independent Variables (Level 1) between Four Sample Representation of Insurance Companies Step 6 Comparative Analysis for Independent Variables (Level 2) between Four Sample Representation of Insurance Companies

DESCRIPTION Correlation Analysis for Independent Variables (Level 1) with Dependent Variables

METHOD Pearson Correlation Multiple Regression Analysis

Correlation Analysis for Independent Variables (Level 2) with Dependent Variables Correlation Analysis for Independent Variables (Level 1) with Dependent Variables

Pearson Correlation Multiple Regression Analysis

Correlation Analysis for Independent Variables (Level 2) with Dependent Variables Comparison of Means of Independent Variables (Transactional Leadership Style, Transformational Leadership Style, Laissez-Faire Leadership Style) Comparison of Means of Dependent Variables (Subordinate Extra Effort, Effectiveness, Satisfaction and Organizational Commitment)

ANOVA

ANOVA

Comparison of Means of Independent Variables (Transactional Leadership Style, Transformational Leadership Style, Laissez-Faire Leadership Style)

ANOVA

Comparison of Means of Independent Variables (Idealized Influence – Attributed, Idealized Influence – Behavior, Inspirational Motivation, Intellectual Stimulation, Individual Consideration, Contingent Reward, Management by Exception – Active, Management by Exception – Passive)

ANOVA

63

4.2 Step 1: For 56 Leaders & 379 Subordinates In the first step of analysis, responses from 379 subordinates about their leaders were studied. The relationship between independent variables (laissez-faire, transactional and transformational leadership styles) and dependent variables (subordinate extra effort, effectiveness, satisfaction and organizational commitment) were studied, using Pearson Correlation and multiple regression methods. TABLE 5 DESCRIPTIVE STATISTICS FOR LEADERSHIP STYLES STD. N LFL Transactional Transformational Valid N (listwise)

Hypothesis 1:

MINIMUM 379 379 379 379

MAXIMUM

.00 1.00 .35

MEAN

4.00 3.25 3.85

DEVIATION

1.4835 2.2375 2.5654

1.08998 .37466 .60884

The actual leadership style tends to be more transactional than transformational.

Alternate Hypothesis:

The actual leadership style does not tend to be more transactional than transformational.

Referring to above table, the mean value for transformational leadership style (2.5654) is higher than mean value for transactional leadership style (2.2375). From the above data, we can say that the actual leadership style tends to be more transactional than transformational is not supported by the data. So, we reject the null hypothesis. 4.2.1 Correlation Analysis for I.V. (Level 1) with Dependent Variables To

understand the

relationship

between

independent

variables

(transactional,

transformational and laissez-faire leadership style) with dependent variables (subordinate extra effort, effectiveness, satisfaction and organizational commitment), we have used Pearson correlation and multiple regression technique.

64

TABLE 6 PEARSON CORRELATION FOR LEADERSHIP STYLES WITH DEPENDENT VARIABLES

LFL Transactional Transformational

EE -.129(*) .342(**) .533(**)

EFF -.321(**) .255(**) .620(**)

SAT -.411(**) .274(**) .629(**)

OC -.333(**) .116(*) .367(**)

*Correlation is significant at the 0.05 level (2-tailed); **Correlation is significant at the 0.01 level (2-tailed).

From above table, we can infer that laissez-faire leadership is negatively correlated with subordinate extra effort, effectiveness, satisfaction, and organizational commitment. Wherein, for each subordinate outcome, the correlation of transformational leadership style is higher than that of transactional leadership style. In subsequent stages, we can check for statistical inference for all three leadership styles for their impact on subordinates‘ outcome. We shall apply multiple regression method to understand the relationship of each independent variable with dependent variables. With F value and its significance, we can infer the relationship for different samples. The following section explains the relationship of independent variables and their relationships with dependent variables.

65

TABLE 7 MULTIPLE REGRESSION FOR LEADERSHIP STYLES & SUBORDINATE EXTRA EFFORT MODEL SUMMARY

MODEL 1

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.544(a) .296 .290 a Predictors: (Constant), Transformational, LFL, Transactional

.62149

ANOVA (a ,b) MODEL 1

SUM OF SQUARES DF MEAN SQUARE

F

SIG.

Regression 60.929 3 20.310 52.582 .000(a) Residual 144.843 375 .386 Total 205.772 378 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: EE COEFFICIENTS (a) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

MODEL

B 1

(Constant) LFL Transactional Transformational

EQUATION 1

COEFFICIENTS

STD. ERROR

.715 .206 .002 .032 .237 .101 .580 .065 a Dependent Variable: EE

t

SIG.

BETA 3.478 .001 .003 .056 .956 .120 2.335 .020 .479 8.921 .000

EE = 0.715 + 0.002 LFL + 0.237 TRANSACTIONAL + 0.580

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 30 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to 66

variables in the equation. Also the standard error of estimate has been reduced to 0.6214. Our calculated F value of 52.582 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire leadership style (p=0.956) is not explanatory variable for subordinate extra effort, whereas transactional (0.020) and transformational (0.000) styles are explanatory variables for subordinate extra effort.

67

TABLE 8 MULTIPLE REGRESSION FOR LEADERSHIP STYLES &SUBORDINATE EFFECTIVENESS MODEL SUMMARY

MODEL 1

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.635(a) .403 .399 a Predictors: (Constant), Transformational, LFL, Transactional

.58646

ANOVA (a, b) MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 87.181 3 29.060 84.493 .000(a) Residual 128.978 375 .344 Total 216.159 378 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: EFF COEFFICIENTS (a) STANDARDIZE

MODE

UNSTANDARDIZE

D

L

D COEFFICIENTS

COEFFICIENTS

B 1

(Constant) LFL Transactional Transformationa l

.952 -.103 .019

.194 .031 .096

.708

.061

a

EQUATION 2

STD. ERROR

SIG t

.

BETA 4.908 .000 -.149 -3.373 .001 .009 .195 .845 11.54 .570 .000 0

Dependent Variable: EFF

EFF = 0.952 – 0.103 LFL + 0.019 TRANSACTIONAL + 0.708

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 40 percent of the variance of 68

subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5864. Our calculated F value of 84.493 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional leadership style (p=0.845) is not explanatory variable for subordinate effectiveness, whereas laissez-faire (0.001) and transformational (0.000) styles are explanatory variables for subordinate effectiveness. Here, we shall note that the laissez-faire leadership style is negatively correlated with subordinate effectiveness.

69

TABLE 9 MULTIPLE REGRESSION FOR LEADERSHIP STYLES & SUBORDINATE SATISFACTION MODEL SUMMARY

MODEL 1

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.672(a) .452 .447 a Predictors: (Constant), Transformational, LFL, Transactional

.66513

ANOVA (a, b) SUM OF MODEL 1

SQUARES

MEAN df

SQUARE

F

SIG.

Regression 136.606 3 45.535 102.927 .000(a) Residual 165.901 375 .442 Total 302.507 378 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: SAT COEFFICIENTS (a) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

MODEL

B 1

(Constant) LFL Transactional Transformational

EQUATION 3

COEFFICIENTS

STD. ERROR

.837 .220 -.214 .035 .156 .108 .763 .070 a Dependent Variable: SAT

t

SIG.

BETA 3.804 -.261 -6.164 .065 1.437 .519 10.966

.000 .000 .152 .000

SAT = 0.837 – 0.217 LFL + 0.156 TRANSACTIONAL + 0.763

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 45 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that 70

the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.6651. Our calculated F value of 102.927 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional leadership style (p=0.152) is not explanatory variable for subordinate satisfaction, whereas laissez-faire (0.000) and transformational (0.000) styles are explanatory variables for subordinate satisfaction. Here, we shall note that the laissez-faire leadership style is negatively correlated with subordinate satisfaction.

71

TABLE 10 MULTIPLE REGRESSION FOR LEADERSHIP STYLES & SUBORDINATE ORGANIZATIONAL COMMITMENT MODEL SUMMARY

MODEL 1

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.416(a) .173 .165 a Predictors: (Constant), Transformational, LFL, Transactional ANOVA (a, b) SUM OF SQUARES df MEAN SQUARE

MODEL 1

8.15464

F

SIG.

Regression 4292.509 3 1430.836 21.517 .000(a) Residual 20547.945 309 66.498 Total 24840.454 312 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: OC COEFFICIENTS (a) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS

COEFFICIENTS

t

SIG.

STD. B 1

ERROR

BETA

(Constant) 37.054 3.009 LFL -1.809 .513 Transactional .001 1.447 Transformational 4.235 1.074 a Dependent Variable: OC

EQUATION 4

12.315 .000 -.216 -3.526 .000 .000 .000 1.000 .275 3.943 .000

OC = 37.054 – 1.809 LFL + 0.001 TRANSACTIONAL + 4.235

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 17 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the

72

model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 8.1546. Our calculated F value of 21.517 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional leadership style (p=1.000) is not explanatory variable for subordinate organizational commitment, whereas laissez-faire (0.000) and transformational (0.000) styles are explanatory variables for subordinate organizational commitment. Here, we shall note that the value of beta for laissez-faire leadership style is negative.

73

4.2.2 Correlation Analysis for I.V. (Level 2) with Dependent Variables TABLE 11 PEARSON CORRELATION BETWEEN LEADERSHIP FACTORS AND DEPENDENT VARIABLES

EE EFF SAT OC IIA .406(**) .542(**) .507(**) .308(**) IIB .278(**) .425(**) .538(**) .292(**) IM .504(**) .616(**) .535(**) .427(**) IS .434(**) .528(**) .515(**) .269(**) IC .336(**) .508(**) .490(**) .168(**) CR .461(**) .554(**) .497(**) .386(**) MBEA .392(**) .481(**) .353(**) .374(**) MBEP -.172(**) -.463(**) -.271(**) -.423(**) LFL -.129(*) -.321(**) -.411(**) -.333(**) **Correlation is significant at the 0.01 level (2-tailed); *Correlation is significant at the 0.05 level (2-tailed). From above table, we can infer that management-by-exception – passive and laissez-faire leadership are negatively correlated with subordinate outcomes (extra effort, effectiveness, satisfaction, and organizational commitment). We can infer that inspirational motivation has highest coefficient of correlation with subordinate extra effort, effectiveness and organizational commitment. Individual influence – behavior has highest coefficient of correlation with subordinate satisfaction. We shall apply multiple regression method to understand the relationship of each independent variable with dependent variables. With F value and its significance, we can infer the relationship for different samples. The following section explains the relationship of independent variables and their relationships with dependent variables.

74

TABLE 12 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE EXTRA EFFORT MODEL SUMMARY

MODEL

R

1 a

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.563(a) .316 .298 .60520 Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 55.454 9 6.162 16.823 .000(a) Residual 119.767 327 .366 Total 175.221 336 a Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM b Dependent Variable: EE COEFFICIENTS (a) UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

MODEL B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

EQUATION 5

1.152 .065 -.180 .287 .185 .059 .131 .055 .077 -.068

STD. ERROR .223 .077 .065 .070 .079 .063 .073 .069 .050 .042 a Dependent Variable: EE

t

SIG.

BETA

.063 -.184 .333 .160 .060 .126 .050 .093 -.100

5.168 .844 -2.757 4.076 2.346 .937 1.783 .800 1.549 -1.611

.000 .399 .006 .000 .020 .349 .075 .424 .122 .108

EE = 1.152 + 0.065 IIA – 0.180 IIB + 0.287 IM + 0.185 IS + 0.059

IC + 0.131 CR + 0.055 MBEA + 0.077 MBEP – 0.068 LFL 75

The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 31 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.6052. Our calculated F value of 16.823 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.399), IC (0.349), CR (0.075), MBEA (0.424), MBEP (0.122) and LFL (0.108) are not explanatory variables for subordinate extra effort, whereas IIB (0.006), IM (0.000), IS (0.020) are explanatory variables for subordinate extra effort. Here, we shall note that IIB, and LFL are negatively correlated with subordinate extra effort.

76

TABLE 13 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE EFFECTIVENESS MODEL SUMMARY

MODEL

R

1 a

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.722(a) .521 .507 .53707 Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 102.434 9 11.382 39.458 .000(a) Residual 94.321 327 .288 Total 196.755 336 a Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM b Dependent Variable: EFF COEFFICIENTS (a)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

t

SIG.

STD. B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

EQUATION 6

1.108 .082 -.119 .249 .174 .222 .121 .014 -.238 .031

ERROR

BETA

.198 .068 .058 .062 .070 .056 .065 .061 .044 .037 a Dependent Variable: EFF

.076 -.116 .273 .142 .211 .111 .012 -.273 .043

5.602 1.206 -2.063 3.993 2.491 3.955 1.866 .223 -5.395 .831

.000 .229 .040 .000 .013 .000 .063 .823 .000 .407

EFF = 1.108 + 0.082 IIA – 0.119 IIB + 0.249 IM + 0.174 IS +

0.222 IC + 0.121 CR + 0.014 MBEA - 0.238 MBEP + 0.031 LFL 77

The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 52 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.53707. Our calculated F value of 39.458 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.229), CR (0.063), MBEA (0.823), and LFL (0.407) are not explanatory variables for subordinate effectiveness, whereas IIB (0.040), IM (0.000), IS (0.013), IC (0.000), MBEP (0.000) are explanatory variables for subordinate effectiveness. Here, we shall note that the IIB and MBEP are negatively correlated with subordinate effectiveness.

78

TABLE 14 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE SATISFACTION MODEL SUMMARY

MODEL

R

1 a

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.692(a) .478 .464 .64575 Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 125.027 9 13.892 33.314 .000(a) Residual 136.358 327 .417 Total 261.384 336 a Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM b Dependent Variable: SAT COEFFICIENT (a)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL EQUATION 7

.870 .029 .133 .172 .290 .160 .090 -.066 .132 -.282

STD. ERROR

t

SIG.

3.658 .355 1.918 2.291 3.450 2.378 1.145 -.893 2.484 -6.303

.000 .723 .056 .023 .001 .018 .253 .373 .013 .000

BETA

.238 .082 .070 .075 .084 .067 .078 .074 .053 .045 a Dependent Variable: SAT

.023 .112 .164 .205 .132 .071 -.049 .131 -.342

SAT = 0.870 + 0.029 IIA + 0.133 IIB + 0.172 IM + 0.290 IS +

0.160 IC + 0.090 CR - 0.066 MBEA + 0.132 MBEP – 0.282 LFL

79

The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 47 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.6457. Our calculated F value of 33.314 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.723), IIB (0.056), CR (0.253), MBEA (0.373) are not explanatory variables for subordinate satisfaction, whereas, IM (0.023), IS (0.001), IC (0.018), MBEP (0.013), and LFL (0.000) are explanatory variables for subordinate satisfaction. Here, we shall note that the MBEP and LFL are negatively correlated with subordinate satisfaction.

80

TABLE 15 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS & SUBORDINATE ORGANIZATIONAL COMMITMENT MODEL SUMMARY

MODEL

R

1 a

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.531(a) .282 .261 7.67218 Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 7005.167 9 778.352 13.223 .000(a) Residual 17835.286 303 58.862 Total 24840.454 312 a Predictors: (Constant), LFL, IS, MBEA, IC, MBEP, IIB, CR, IIA, IM b Dependent Variable: OC COEFFICIENTS (a)

MODEL 1

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B (Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

EQUATION 8

39.676 1.090 -.040 1.661 .149 -1.520 1.525 1.381 -2.511 -.537

STD. ERROR

BETA

2.943 1.019 .859 .943 1.044 .842 .970 .930 .645 .554 a Dependent Variable: OC

.084 -.003 .153 .010 -.121 .117 .101 -.248 -.064

t

SIG.

13.482 1.069 -.047 1.762 .142 -1.806 1.572 1.485 -3.894 -.968

.000 .286 .963 .079 .887 .072 .117 .139 .000 .334

OC = 39.676 + 1.090 IIA – 0.040 IIB + 1.661 IM + 0.149 IS -

1.520 IC + 1.525 CR + 1.381 MBEA - 2.511 MBEP – 0.537 LFL 81

The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 28.2 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 7.67. Our calculated F value of 13.223 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.286), IIB (0.963), IM (0.079), IS (0.887), IC (0.072), MBEA (0.139), CR (0.117), and LFL (0.334) are not explanatory variables for subordinate organizational commitment, whereas, MBEP (0.000) is explanatory variable for subordinate organizational commitment. Here, we shall note that the IIB, IC, MBEP, and LFL are negatively correlated with subordinate organizational commitment.

82

4.3 Step 2: For Each Sample Representation Independently In the previous section, we have analyzed the relationships between independent variables with dependent variables for total responses collected from three different samples. In this section, we shall analyze the relationships for each different sample, independently. 4.3.1 Correlation Analysis for I.V. (Level 1) with Dependent Variable We shall analyze the correlation between independent variables (transactional, transformational, and laissez-faire leadership style) with dependent variables (subordinate extra effort, effectiveness, satisfaction, and organizational commitment) for each of three different samples, i.e. State Bank of India, companies in Insurance sector, and business schools. State Bank of India The researcher collected responses from 162 subordinates of 28 branch managers from State Bank of India. Following section analyzes the relationship of leadership styles with dependence variables for the State Bank of India, using multiple regression method.

83

TABLE 16 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EXTRA EFFORT (SBI)

MODEL SUMMARY

MODEL

R

ADJUSTED R

STD. ERROR OF

SQUARE

THE ESTIMATE

NATURE OF SAMPLE = BANK (SELECTED) 1 a

R SQUARE

.706(a) .498 .488 Predictors: (Constant), Transformational, LFL, Transactional

.57921

ANOVA (a, b, c) MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 52.555 3 17.518 52.218 .000(a) Residual 53.006 158 .335 Total 105.561 161 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: EE c Selecting only cases for which Nature of Sample = Bank COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

MODEL

B 1

STD. ERROR

COEFFICIENTS

t

BETA

(Constant) LFL Transactional Transformational

EQUATION 9

SIG.

.686 .274 2.503 -.034 .041 -.049 -.844 -.081 .141 -.039 -.572 .879 .083 .718 10.615 a Dependent Variable: EE b Selecting only cases for which Nature of Sample = Bank

.013 .400 .568 .000

EE = 0.686 – 0.034 LFL – 0.081 TRANSACTIONAL + 0.879

TRANSFORMASTIONAL 84

The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 49 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5792. Our calculated F value of 52.218 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (p=0.400), and transactional (0.568) leadership styles are not explanatory variables for subordinate extra effort, whereas transformational (p=0.000) style is explanatory variable for subordinate extra effort. Here, we shall note that the laissez-faire and transactional leadership styles are negatively correlated with subordinate extra effort.

85

TABLE 17 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EFFECTIVENESS (SBI) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = MODEL

BANK (SELECTED)

1 a

STD. ERROR OF R SQUARE

THE ESTIMATE

.663(a) .439 .428 Predictors: (Constant), Transformational, LFL, Transactional

.59322

ANOVA (a, b, c) MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 43.499 3 14.500 41.202 .000(a) Residual 55.602 158 .352 Total 99.101 161 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: EFF c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b) UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

MODEL B 1

(Constant) LFL Transactional Transformational

STD. ERROR

SIG.

3.536 -5.082 1.413 7.067

.001 .000 .160 .000

BETA

.993 .281 -.213 .042 -.314 .204 .144 .102 .599 .085 .505 a Dependent Variable: EFF b Selecting only cases for which NatureofSample = Bank

EQUATION 10

t

EFF =0.993 – 0.213 LFL + 0.204 TRANSACTIONAL + 0.599

TRANSFORMASTIONAL

86

The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 43 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.59322. Our calculated F value of 41.202 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional (0.160) leadership style is not explanatory variable for subordinate effectiveness, whereas laissez-faire (p=0.000), and transformational (p=0.000) styles are explanatory variables for subordinate effectiveness. Here, we shall note that the laissez-faire is negatively correlated with subordinate effectiveness.

87

TABLE 18 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE SATISFACTION (SBI) MODEL SUMMARY ADJUSTED R R NATUREOFSAMPLE =

R

STD. ERROR OF

BANK (SELECTED)

SQUARE

THE ESTIMATE

MODEL 1 a

SQUARE

.634(a) .402 .391 Predictors: (Constant), Transformational, LFL, Transactional

.71529

ANOVA (b,c) MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 54.398 3 18.133 35.440 .000(a) Residual 80.838 158 .512 Total 135.236 161 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: SAT c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) LFL Transactional Transformational

STD. ERROR

SIG.

3.046 -3.316 .364 7.656

.003 .001 .716 .000

BETA

1.031 .339 -.167 .051 -.211 .063 .174 .027 .783 .102 .565 a Dependent Variable: SAT b Selecting only cases for which NatureofSample = Bank

EQUATION 11

t

SAT = 1.031 – 0.167 LFL + 0.063 TRANSACTIONAL + 0.783

TRANSFORMASTIONAL

88

The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 40 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.7152. Our calculated F value of 35.440 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional (0.716) leadership style is not explanatory variable for subordinate satisfaction, whereas laissez-faire (0.001) and transformational (0.000) styles are explanatory variables for subordinate satisfaction. Here, we shall note that the laissez-faire is negatively correlated with subordinate satisfaction.

89

TABLE 19 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (SBI) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = BANK

STD. ERROR OF

(SELECTED)

THE ESTIMATE

MODEL 1 a

.300(a) .090 .061 Predictors: (Constant), Transformational, LFL, Transactional

8.54814

ANOVA (a, b, c) MODEL 1

SUM OF SQUARES df MEAN SQUARE

F

SIG.

Regression 672.171 3 224.057 3.066 .032(a) Residual 6795.582 93 73.071 Total 7467.753 96 a Predictors: (Constant), Transformational, LFL, Transactional b Dependent Variable: OC c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS

COEFFICIENTS

t

SIG.

STD. B 1

ERROR

BETA

(Constant) 42.996 4.880 8.811 .000 LFL -1.176 .851 -.150 -1.383 .170 Transactional -1.525 2.589 -.077 -.589 .557 Transformational 3.610 1.974 .250 1.829 .071 a Dependent Variable: OC b Selecting only cases for which NatureofSample = Bank

EQUATION 12

OC = 42.996 – 1.176 LFL – 1.525TRANSACTIONAL + 3.610

TRANSFORMASTIONAL 90

The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 9 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 8.5481. Our calculated F value of 3.066 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.032. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.170), transactional (0.557), and transformational (0.071) leadership styles are not explanatory variables for subordinate organizational commitment. Here, we shall note that the laissez-faire and transactional styles are negatively correlated with subordinate organizational commitment. Insurance Companies The following section analyzes the relationship for the companies in Insurance sector, using multiple regression method. The following table shows the descriptive statistics for leadership style in insurance companies. TABLE 20 DESCRIPTIVE STATISTICS FOR LEADERSHIP STYLE (INSURANCE) N Transactional Transformational Laissez-Faire Valid N (listwise)

179 179 179 179

MINIMUM MAXIMUM MEAN STD. DEVIATION 1.42 .35 .00

3.17 2.2025 3.85 2.4472 3.50 1.6522

.35782 .52784 1.03054

91

TABLE 21 PEARSON CORRELATION - LEADERSHIP STYLE (INSURANCE) EXTRA EFFORT EFFECTIVENESS SATISFACTION Transactional Transformational Laissez-Faire

ORGANIZATION COMMITMENT

.359(**) .177(*) .276(**) .286(**) .594(**) .671(**) -.093 -.205(**) -.526(**) ** Correlation is significant at the 0.01 level (2-tailed); *Correlation is significant at the 0.05 level (2-tailed).

.207(**) .478(**) -.231(**)

From above tables, we can infer that the correlation is higher for transformational leadership style than transactional and laissez-faire leadership style with each of the dependent variables.

92

TABLE 22 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EXTRA EFFORT (INSURANCE COMPANIES) MODEL SUMMARY

MODEL 1 a

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.397(a) .157 .143 .61061 Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 12.194 3 4.065 10.902 .000(a) Residual 65.248 175 .373 Total 77.441 178 a Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL b Dependent Variable: EE COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

COEFFICIENTS

STD. MODEL 1

B (Constant) LFL Transactional Transformational

ERROR

BETA

1.132 .327 -.051 .054 -.080 .592 .151 .321 .152 .114 .121 a Dependent Variable: EE b Selecting only cases for which NatureofSample = Insurance

EQUATION 13

t

SIG.

3.461 -.951 3.923 1.331

.001 .343 .000 .185

EE = 1.132 – 0.051 LFL + 0.592 TRANSACTIONAL + 0.152

TRANSFORMASTIONAL

93

The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 15 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.61061. Our calculated F value of 10.902 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.343), and transformational (0.185) leadership styles are not explanatory variables for subordinate extra effort, whereas transactional (0.000) style is explanatory variable for subordinate extra effort. Here, we shall note that the laissez-faire leadership style is negatively correlated with subordinate extra effort.

94

TABLE 23 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EFFECTIVENESS (INSURANCE COMPANIES) MODEL SUMMARY

MODEL 1 a

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.607(a) .369 .358 .58265 Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 34.676 3 11.559 34.049 .000(a) Residual 59.408 175 .339 Total 94.084 178 a Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL b Dependent Variable: EFF COEFFICIENTS (a, b) UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

MODEL B 1

STD. ERROR

t

BETA

(Constant) LFL Transactional Transformational

.576 .312 .091 .051 .128 -.242 .144 -.119 .964 .109 .700 a Dependent Variable: EFF b Selecting only cases for which NatureofSample = Insurance

EQUATION 14

SIG.

1.845 1.760 -1.683 8.877

EFF = 0.576 + 0.091LFL – 0.242 TRANSACTIONAL + 0.964

TRANSFORMASTIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 36 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that 95

.067 .080 .094 .000

the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.58265. Our calculated F value of 34.049 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.080), and transactional (0.094) leadership styles are not explanatory variables for subordinate effectiveness, whereas transformational (0.000) style is explanatory variable for subordinate effectiveness. Here, we shall note that the transactional leadership style is negatively correlated with subordinate effectiveness.

96

TABLE 24 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE SATISFACTION (INSURANCE COMPANIES) MODEL SUMMARY

MODEL 1 a

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.724(a) .524 .516 .59367 Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL ANOVA (a, b)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 67.953 3 22.651 64.269 .000(a) Residual 61.678 175 .352 Total 129.631 178 a Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL b Dependent Variable: SAT COEFFICIENTS (a, b) UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

MODEL B 1

STD. ERROR

SIG.

1.822 -5.236 2.167 6.818

.070 .000 .032 .000

BETA

(Constant) LFL Transactional Transformational

.580 .318 -.275 .052 -.332 .318 .147 .133 .755 .111 .467 a Dependent Variable: SAT b Selecting only cases for which NatureofSample = Insurance

EQUATION 15

t

SAT = 0.580 – 0.275 LFL + 0.318 TRANSACTIONAL + 0.755

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 52 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to 97

variables in the equation. Also the standard error of estimate has been reduced to 0.5936. Our calculated F value of 64.269 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.000), transactional (0.032), and transformational (0.000) styles are explanatory variables for subordinate satisfaction. Here, we shall note that the laissez-faire leadership style is negatively correlated with subordinate satisfaction.

98

TABLE 25 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (INSURANCE COMPANIES) MODEL SUMMARY ADJUSTED R R

MODEL

SQUARE

NATUREOFSAMPLE =

STD. ERROR OF

INSURANCE (SELECTED)

THE ESTIMATE

1 a

.487(a) .237 .224 Predictors: (Constant), Transformational, Transactional, LFL

8.06619

ANOVA (a, b, c) MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 3520.091 3 1173.364 18.034 .000(a) Residual 11321.033 174 65.063 Total 14841.124 177 a Predictors: (Constant), Transformational, Transactional, LFL b Dependent Variable: OC c Selecting only cases for which NatureofSample = Insurance COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS

COEFFICIENTS

t

SIG.

STD. B 1

ERROR

BETA

(Constant) 34.159 4.331 7.887 .000 LFL -2.480 .713 -.279 -3.479 .001 Transactional .442 2.000 .017 .221 .825 Transformational 5.000 1.506 .289 3.321 .001 a Dependent Variable: OC b Selecting only cases for which NatureofSample = Insurance

99

EQUATION 16

OC = 34.159 – 2.480 LFL – 0.442 TRANSACTIONAL + 5.000

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 23 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 8.066. Our calculated F value of 18.034 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional (0.825) leadership style is not explanatory variable for subordinate organizational commitment, whereas, laissez-faire (0.001), and transformational (0.001) styles are explanatory variables for subordinate organizational commitment. Here, we shall note that the laissez-faire leadership style is negatively correlated with subordinate organizational commitment.

100

B-School Directors The following section analyzes the relationship for the directors of business schools, using multiple regression method. The following table shows the descriptive statistics for leadership style for directors of business schools.

TABLE 26 DESCRIPTIVE STATISTICS FOR LEADERSHIP STYLE (MANAGEMENT SCHOOLS) N MINIMUM MAXIMUM MEAN STD. DEVIATION Transactional Transformational Laissez-Faire Valid N (listwise)

38 38 38 38

1.50 1.10 .00

3.00 2.2741 3.75 2.8868 3.75 1.0263

.37464 .59465 .90939

TABLE 27 PEARSON CORRELATION - LEADERSHIP STYLE (MANAGEMENT SCHOOL) EXTRA EFFECTIVENESS SATISFACTION ORGANIZATION EFFORT Transactional Transformational Laissez-Faire

COMMITMENT

.351* .225 .100 .709** .813** .628** -.334* -.608** -.582** *Correlation is significant at the 0.05 level (2-tailed); **Correlation is significant at the 0.01 level (2-tailed).

.287 .224 .225

From above table, we can infer that the correlation is higher for transformational leadership style than transactional and laissez-faire leadership style with each of the dependent variables.

101

TABLE 28 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EXTRA EFFORT (B-SCHOOL DIRECTORS) MODEL SUMMARY

MODEL 1 a

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.713(a) .509 .465 .57175 Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL ANOVA (a, b)

MODEL 1

SUM OF SQUARES df MEAN SQUARE

F

SIG.

Regression 11.505 3 3.835 11.732 .000(a) Residual 11.114 34 .327 Total 22.620 37 a Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL b Dependent Variable: EE COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

MODEL 1

B

COEFFICIENTS

STD. ERROR

BETA

t

SIG.

(Constant) LFL Transactional Transformational

-.296 .685 -.432 .668 .028 .132 .032 .211 .834 .137 .296 .066 .463 .646 .920 .220 .700 4.189 .000 a Dependent Variable: EE b Selecting only cases for which NatureofSample = B-School

EQUATION 17

EE = – 0.296 + 0.028 LFL + 0.137 TRANSACTIONAL + 0.920

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 50 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that 102

the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5717. Our calculated F value of 11.732 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.834), and transactional (0.646) leadership styles are not explanatory variables for subordinate extra effort, whereas transformational (0.000) style is explanatory variable for subordinate extra effort.

103

TABLE 29 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE EFFECTIVENESS (B-SCHOOL DIRECTORS) MODEL SUMMARY

MODEL 1 a

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.840(a) .705 .679 .40267 Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL ANOVA (a, b)

MODEL 1

SUM OF SQUARES df MEAN SQUARE

F

SIG.

Regression 13.191 3 4.397 27.119 .000(a) Residual 5.513 34 .162 Total 18.704 37 a Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL b Dependent Variable: EFF COEFFICIENTS (a, b) UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

MODEL B 1

STD. ERROR

SIG.

1.608 -1.919 -.388 5.479

.117 .063 .700 .000

BETA

(Constant) LFL Transactional Transformational

.775 .482 -.178 .093 -.228 -.081 .209 -.043 .848 .155 .709 a Dependent Variable: EFF b Selecting only cases for which NatureofSample = B-School

EQUATION 18

t

EFF = 0.775 - 0.178 LFL - 0.081TRANSACTIONAL + 0.848

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 70 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to 104

variables in the equation. Also the standard error of estimate has been reduced to 0.4026. Our calculated F value of 27.119 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.063), and transactional (0.700) leadership styles are not explanatory variables for subordinate effectiveness, whereas transformational (0.000) style is explanatory variable for subordinate effectiveness. Here, we shall note that the laissez-faire and transactional leadership styles are negatively correlated with subordinate effectiveness.

105

TABLE 30 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE SATISFACTION (B-SCHOOL DIRECTORS) MODEL SUMMARY

MODEL 1 a

R

R

ADJUSTED R

STD. ERROR OF THE

SQUARE

SQUARE

ESTIMATE

.696(a) .484 .438 .66404 Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL ANOVA (a, b)

MODEL 1

SUM OF SQUARES df MEAN SQUARE

F

SIG.

Regression 14.061 3 4.687 10.629 .000(a) Residual 14.992 34 .441 Total 29.053 37 a Predictors: (Constant), LFL, TRANSACTIONAL, TRANSFORMATIONAL b Dependent Variable: SAT COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

STD. ERROR

SIG.

1.811 -2.010 -.494 2.857

.079 .052 .625 .007

BETA

(Constant) LFL Transactional Transformational

1.440 .795 -.308 .153 -.316 -.170 .344 -.072 .729 .255 .489 a Dependent Variable: SAT b Selecting only cases for which NatureofSample = B-School

EQUATION 19

t

SAT = 1.440 – 0.308 LFL – 0.170 TRANSACTIONAL + 0.729

TRANSFORMATIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 48 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to 106

variables in the equation. Also the standard error of estimate has been reduced to 0.6640. Our calculated F value of 10.629 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that laissez-faire (0.052), and transactional (0.625) leadership styles are not explanatory variables for subordinate satisfaction, whereas transformational (0.007) style is explanatory variable for subordinate satisfaction. Here, we shall note that the laissez-faire and transactional leadership styles are negatively correlated with subordinate satisfaction.

107

TABLE 31 MULTIPLE REGRESSION FOR LEADERSHIP STYLE WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (B-SCHOOL DIRECTORS)

MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = BMODEL

SCHOOL (SELECTED)

1 a

STD. ERROR OF R SQUARE

THE ESTIMATE

.456(a) .208 .138 Predictors: (Constant), Transformational, Transactional, LFL

5.09631

ANOVA (a, b, c) MODEL 1

SUM OF SQUARES df MEAN SQUARE

F

SIG.

Regression 232.019 3 77.340 2.978 .045(a) Residual 883.060 34 25.972 Total 1115.079 37 a Predictors: (Constant), Transformational, Transactional, LFL b Dependent Variable: OC c Selecting only cases for which NatureofSample = B-School COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

COEFFICIENTS

STD. MODEL 1

B

ERROR

BETA

t

SIG.

(Constant) 32.122 6.102 5.264 .000 LFL 2.664 1.176 .441 2.266 .030 Transactional 1.005 2.643 .069 .380 .706 Transformational 3.899 1.958 .422 1.991 .055 a Dependent Variable: OC b Selecting only cases for which NatureofSample = B-School

108

EQUATION 20

OC = 32.122 + 2.664 LFL + 1.005 TRANSACTIONAL + 3.899

TRANSFORMASTIONAL The

final regression

model with three

independent

variables

(transactional,

transformational and laissez-faire leadership style) explains 20 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 5.0963. Our calculated F value of 2.978 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.045. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that transactional (0.706), and transformational (0.055) leadership styles are not explanatory variables for subordinate organizational commitment, whereas, laissez-faire (0.030) style is explanatory variable for subordinate organizational commitment.

109

Now, based on the equations formed for different samples, we shall check for the hypotheses by comparing the beta and significance level for respective samples.

TABLE 32 CORRELATION AND SIGNIFICANCE OF LAISSEZ-FAIRE LEADERSHIP STYLE WITH DEPENDENT VARIABLES BETA (STANDARDIZED) 0.003 -0.049 -0.080 0.032 -0.149 -0.314 0.128 -0.228 -0.216 -0.150 -0.279 0.441 -0.261 -0.211 -0.332 -0.316 Hypothesis 2:

SIG.

0.956 0.400 0.343 0.834 0.001 0.000 0.080 0.063 0.000 0.170 0.001 0.030 0.000 0.001 0.000 0.052

DEPENDENT VARIABLE EE EE EE EE EFF EFF EFF EFF OC OC OC OC SAT SAT SAT SAT

SAMPLE

Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL

Laissez-faire leadership style is not a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment.

Alternate Hypothesis: Laissez-faire leadership style is a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment. From previous table, we can conclude that laissez-faire leadership style is not a significant explanatory variable for subordinate extra effort (where in all four cases, we notice value of prob. more than 0.05); and a significant explanatory variable for 110

subordinate satisfaction and organizational commitment (where three out of four instances, we notice value of prob. less than 0.05). In two cases, the value for prob. in case of subordinate effectiveness, found to be less than 0.05 and in rest two cases, it was noticed greater than 0.05. So, we refrain from making any conclusion for that. We here note that in all four instances, the laissez-faire leadership is negatively correlated with subordinate satisfaction. TABLE 33 CORRELATION AND SIGNIFICANCE OF TRANSACTIONAL LEADERSHIP STYLE WITH DEPENDENT VARIABLES BETA (STANDARDIZED) 0.120 -0.039 0.321 0.066 0.009 0.102 -0.119 -0.043 0.000 -0.077 0.017 0.069 0.065 0.027 0.133 -0.072 Hypothesis 3:

SIG.

0.020 0.568 0.000 0.646 0.845 0.160 0.094 0.700 1.000 0.557 0.825 0.706 0.152 0.716 0.032 0.625

DEPENDENT VARIABLE EE EE EE EE EFF EFF EFF EFF OC OC OC OC SAT SAT SAT SAT

SAMPLE

Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL

Transactional leadership style is not a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment.

Alternate Hypothesis: Transactional leadership style is a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment.

111

From previous table, we can conclude that transactional leadership style is not a significant explanatory variable for subordinate effectiveness and organizational commitment (where in all four cases for each variable, we notice value of prob. more than 0.05); and for subordinate satisfaction (where three out of four cases, we found value of prob. more than 0.05). In two cases, the value for prob. in case of subordinate extra effort, found to be less than 0.05 and in rest two cases, it was noticed greater than 0.05. So, we refrain from making any conclusion for that.

112

TABLE 34 CORRELATION AND SIGNIFICANCE OF TRANSFORMATIONAL LEADERSHIP STYLE WITH DEPENDENT VARIABLES BETA (STANDARDIZED) 0.479 0.718 0.121 0.700 0.570 0.505 0.700 0.709 0.275 0.250 0.289 0.422 0.519 0.565 0.467 0.489

Hypothesis 4:

SIG.

0.000 0.000 0.185 0.000 0.000 0.000 0.000 0.000 0.000 0.071 0.001 0.055 0.000 0.000 0.000 0.007

DEPENDENT VARIABLE EE EE EE EE EFF EFF EFF EFF OC OC OC OC SAT SAT SAT SAT

SAMPLE

Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL

Transformational leadership style is not a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment.

Alternate Hypothesis: Transformational leadership style is a significant explanatory variable for subordinate extra effort, effectiveness, satisfaction, and organizational commitment. From above table, we can conclude that transformational leadership style is a significant explanatory variable for subordinate extra effort, effectiveness, and satisfaction. Whereas, in case of subordinate organizational commitment, we found two instances where the value of probability more than 0.05, so we refrain from making any conclusion in that case.

113

4.3.2 Correlation Analysis for I.V. (Level 2) with Dependent Variable We shall analyze the correlation between independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) with dependent variables (subordinate extra effort, effectiveness, satisfaction, and organizational commitment) for each of three different samples, i.e. State Bank of India, companies in Insurance sector, and business schools. State Bank of India The researcher collected responses from 162 subordinates of 28 branch managers from State Bank of India. Following section analyzes the relationship of leadership factors with dependent variables for the State Bank of India, using multiple regression method.

114

TABLE 35 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT (SBI) MODEL SUMMARY ADJUSTED R

R

SQUARE NATUREOFSAMPLE = MODEL

BANK (SELECTED)

1 a

STD. ERROR OF R SQUARE

THE ESTIMATE

.707(a) .500 .459 .58429 Predictors: (Constant), LFL, IS, IIB, MBEA, MBEP, IC, CR, IIA, IM ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 37.557 9 4.173 12.224 .000(a) Residual 37.553 110 .341 Total 75.110 119 a Predictors: (Constant), LFL, IS, IIB, MBEA, MBEP, IC, CR, IIA, IM b Dependent Variable: EE c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

.958 .090 -.072 .225 .319 .102 .003 .091 -.016 -.132

STD. ERROR

t

SIG.

2.964 .856 -.694 2.103 2.505 1.046 .029 .891 -.219 -2.103

.004 .394 .489 .038 .014 .298 .977 .375 .827 .038

BETA

.323 .105 .104 .107 .127 .097 .112 .102 .075 .063 a Dependent Variable: EE b Selecting only cases for which NatureofSample =

.092 -.068 .254 .266 .100 .003 .082 -.019 -.186 Bank

115

EQUATION 21

EE = 0.958 + 0.090 IIA – 0.072 IIB + 0.225 IM + 0.329 IS + 0.102

IC + 0.003 CR + 0.091 MBEA – 0.016 MBEP – 0.132 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 50 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 05842. Our calculated F value of 12.224 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.394), IIB (0.489), CR (0.977), MBEA (0.375), IC (0.298), and MBEP (0.827) are not explanatory variables for subordinate extra effort, whereas, IM (0.038), IS (0.014), and LFL (0.038) are explanatory variables for subordinate extra effort. Here, we shall note that the IIB, MBEP, and LFL are negatively correlated with subordinate extra effort.

116

TABLE 36 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS (SBI) MODEL SUMMARY ADJUSTED R R

SQUARE STD. ERROR OF

NATUREOFSAMPLE = BANK MODEL

THE ESTIMATE

(SELECTED)

1 a

.775(a) .601 .568 .54209 Predictors: (Constant), LFL, IS, IIB, MBEA, MBEP, IC, CR, IIA, IM ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 48.623 9 5.403 18.385 .000(a) Residual 32.325 110 .294 Total 80.948 119 a Predictors: (Constant), LFL, IS, IIB, MBEA, MBEP, IC, CR, IIA, IM b Dependent Variable: EFF c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

1.232 -.006 -.153 .289 .230 .093 .138 .149 -.228 -.059

STD. ERROR

t

SIG.

4.110 -.060 -1.588 2.921 1.949 1.035 1.326 1.577 -3.276 -1.007

.000 .952 .115 .004 .054 .303 .188 .118 .001 .316

BETA

.300 .097 -.006 .096 -.140 .099 .315 .118 .185 .090 .088 .104 .127 .094 .130 .070 -.254 .058 -.079 a Dependent Variable: EFF b Selecting only cases for which NatureofSample = Bank

117

EQUATION 22

EFF = 1.232 – 0.006 IIA – 0.153 IIB + 0.289 IM + 0.230 IS +

0.093 IC + 0.138 CR + 0.149 MBEA – 0.228 MBEP – 0.059 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 60 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5420. Our calculated F value of 18.385 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.952), IIB (0.115), IS (0.054), CR (0.188), IC (0.303), MBEA (0.118), and LFL (0.316) are not explanatory variables for subordinate effectiveness, whereas, IM (0.004), MBEP (0.001) are explanatory variables for subordinate effectiveness. Here, we shall note that the IIA, IIB, MBEP and LFL are negatively correlated with subordinate effectiveness.

118

TABLE 37 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION (SBI) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = MODEL

BANK (SELECTED)

1 a

STD. ERROR OF R SQUARE

THE ESTIMATE

.662(a) .438 .392 .72011 Predictors: (Constant), LFL, IS, IIB, MBEA, MBEP, IC, CR, IIA, IM ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 44.407 9 4.934 9.515 .000(a) Residual 57.041 110 .519 Total 101.448 119 a Predictors: (Constant), LFL, IS, IIB, MBEA, MBEP, IC, CR, IIA, IM b Dependent Variable: SAT c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

.867 .099 .066 .141 .395 .115 -.015 .003 .103 -.259

STD. ERROR

t

SIG.

2.178 .768 .511 1.073 2.516 .957 -.110 .023 1.108 -3.347

.032 .444 .610 .285 .013 .341 .913 .982 .270 .001

BETA

.398 .129 .088 .128 .053 .132 .138 .157 .283 .120 .097 .138 -.013 .125 .002 .093 .102 .077 -.313 a Dependent Variable: SAT b Selecting only cases for which NatureofSample = Bank

119

EQUATION 23

SAT = 0.867 + 0.099 IIA + 0.066 IIB + 0.141 IM + 0.295 IS +

0.115 IC – 0.015 CR + 0.003 MBEA + 0.103 MBEP – 0.259 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 43 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.7201. Our calculated F value of 9.515 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.444), IIB (0.610), IM (0.285), IC (0.341), CR (0.913), MBEA (0.982), MBEP (0.270) are not explanatory variable for subordinate satisfaction, whereas, IS (0.013), and LFL (0.001) are explanatory variables for subordinate satisfaction. Here, we shall note that the CR and LFL are negatively correlated with subordinate satisfaction.

120

TABLE 38 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (SBI) MODEL SUMMARY ADJUSTED R R

SQUARE STD. ERROR OF

NATUREOFSAMPLE = BANK

MODEL

THE ESTIMATE

(SELECTED)

1 a

.444(a) .197 .114 8.29986 Predictors: (Constant), LFL, IS, IIB, MBEP, IC, MBEA, CR, IIA, IM ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES df MEAN SQUARE

F

SIG.

Regression 1474.529 9 163.837 2.378 .019(a) Residual 5993.224 87 68.888 Total 7467.753 96 a Predictors: (Constant), LFL, IS, IIB, MBEP, IC, MBEA, CR, IIA, IM b Dependent Variable: OC c Selecting only cases for which NatureofSample = Bank COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

46.537 2.152 -2.881 1.955 .408 -.711 .832 .310 -2.524 -.096

STD. ERROR

t

SIG.

9.251 1.312 -1.748 1.109 .197 -.443 .471 .182 -2.231 -.099

.000 .193 .084 .271 .845 .659 .639 .856 .028 .921

BETA

5.031 1.641 1.649 1.763 2.073 1.605 1.765 1.699 1.131 .974 a Dependent Variable: OC b Selecting only cases for which NatureofSample =

.192 -.235 .192 .030 -.060 .070 .025 -.270 -.012 Bank

121

EQUATION 24

OC = 46.537 + 2.152 IIA – 2.881 IIB + 1.955 IM + 0.408 IS –

0.711 IC + 0.832 CR + 0.310 MBEA – 2.524 MBEP – 0.096 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 19 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 8.29. Our calculated F value of 2.378 and p value is 0.019. As the p value is higher than 0.05, so we see that the regression as a whole is not highly significant. Referring to probability value from above table, we can conclude that IIA (0.193), IIB (0.084), IM (0.271), IS (0.845), IC (0.659), CR (0.639), MBEA (0.856), and LFL (0.921) are not explanatory variables for subordinate organizational commitment, whereas, MBEP (0.028) is explanatory variable for subordinate organizational commitment. Here, we shall note that the IIB, IC, MBEP, and LFL are negatively correlated with subordinate organizational commitment.

122

Insurance Companies The researcher collected responses from four companies in Insurance sector. Following section analyzes the relationship of leadership factors with dependent variables for the Insurance sector, using multiple regression method.

123

TABLE 39 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT (INSURANCE COMPANIES) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = MODEL

INSURANCE (SELECTED)

1 a

STD. ERROR OF R SQUARE

THE ESTIMATE

.513(a) .264 .224 .58088 Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 20.418 9 2.269 6.724 .000(a) Residual 57.023 169 .337 Total 77.441 178 a Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA b Dependent Variable: EE c Selecting only cases for which NatureofSample = Insurance COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

1.491 .065 -.250 .352 .134 -.062 .147 .064 .145 -.072

STD. ERROR

t

SIG.

BETA

.321 4.643 .125 .060 .519 .092 -.271 -2.723 .096 .410 3.676 .110 .115 1.219 .085 -.065 -.720 .105 .135 1.408 .109 .059 .592 .071 .182 2.036 .060 -.113 -1.205 a Dependent Variable: EE b Selecting only cases for which NatureofSample = Insurance

.000 .605 .007 .000 .224 .472 .161 .555 .043 .230

124

EQUATION 25

EE = 1.491 + 0.065 IIA – 0.250 IIB + 0.352 IM + 0.134 IS – 0.062

IC + 0.147 CR + 0.064 MBEA + 0.145 MBEP – 0.072 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 26 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5808. Our calculated F value of 6.724 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.605), IS (0.224), IC (0.472), CR (0.161), MBEA (0.555), and LFL (0.230) are not explanatory variables for subordinate extra effort, whereas, IIB (0.007), IM (0.000), and MBEP (0.043) are explanatory variables for subordinate extra effort. Here, we shall note that the IIB, IC and LFL are negatively correlated with subordinate extra effort.

125

TABLE 40 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS (INSURANCE COMPANIES) MODEL SUMMARY ADJUSTED R R

MODEL 1 a

SQUARE

NATUREOFSAMPLE =

R

STD. ERROR OF

INSURANCE (SELECTED)

SQUARE

THE ESTIMATE

.702(a) .493 .466 .53139 Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 46.362 9 5.151 18.243 .000(a) Residual 47.722 169 .282 Total 94.084 178 a Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA b Dependent Variable: EFF c Selecting only cases for which NatureofSample = Insurance COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

.918 .246 -.114 .265 .112 .276 .119 -.115 -.317 .168

STD. ERROR

t

SIG.

BETA

.294 3.126 .114 .205 2.156 .084 -.112 -1.358 .088 .280 3.032 .101 .087 1.110 .078 .264 3.530 .096 .099 1.244 .100 -.095 -1.157 .065 -.361 -4.874 .055 .238 3.050 a Dependent Variable: EFF b Selecting only cases for which NatureofSample = Insurance

.002 .032 .176 .003 .269 .001 .215 .249 .000 .003

126

EQUATION 26

EFF = 0.918 + 0.246 IIA – 0.114 IIB + 0.265 IM + 0.112 IS +

0.216 IC + 0.119 CR – 0.115 MBEA – 0.317 MBEP + 0.168 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 49 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5313. Our calculated F value of 18.243 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIB (0.176), IS (0.269), CR (0.215), MBEA (0.249) are not explanatory variable for subordinate effectiveness, whereas, IIA (0.032), IM (0.003), IC (0.001), MBEP (0.000), and LFL (0.003) are explanatory variables for subordinate effectiveness. Here, we shall note that the IIB, MBEA and MBEP are negatively correlated with subordinate effectiveness.

127

TABLE 41 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION (INSURANCE COMPANIES) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = MODEL

INSURANCE (SELECTED)

1 a

STD. ERROR OF R SQUARE

THE ESTIMATE

.741(a) .549 .525 .58806 Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

MEAN SQUARE

F

SIG.

Regression 71.189 9 7.910 22.874 .000(a) Residual 58.442 169 .346 Total 129.631 178 a Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA b Dependent Variable: SAT c Selecting only cases for which NatureofSample = Insurance COEFFICIENTS (a, b)

MODEL

UNSTANDARDIZED

STANDARDIZED

COEFFICIENTS

COEFFICIENTS

B 1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

.688 -.052 .117 .278 .313 .200 .167 -.093 .150 -.314

STD. ERROR

t

SIG.

BETA

.325 2.116 .126 -.037 -.411 .093 .098 1.256 .097 .251 2.875 .112 .207 2.811 .086 .163 2.308 .106 .119 1.575 .110 -.066 -.845 .072 .145 2.080 .061 -.379 -5.152 a Dependent Variable: SAT b Selecting only cases for which NatureofSample = Insurance

.036 .682 .211 .005 .006 .022 .117 .400 .039 .000

128

EQUATION 27

SAT = 0.688 – 0.052 IIA + 0.117 IIB + 0.278 IM + 0.313 IS +

0.200 IC + 0.167 CR – 0.093 MBEA + 0.150 MBEP – 0.314 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 54 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5880. Our calculated F value of 22.874 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.682), IIB (0.211), CR (0.117), MBEA (0.400) are not explanatory variables for subordinate satisfaction, whereas, IM (0.005), IS (0.006), IC (0.022), MBEP (0.039), and LFL (0.000) are explanatory variables for subordinate satisfaction. Here, we shall note that the MBEP and LFL are negatively correlated with subordinate satisfaction.

129

TABLE 42 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (INSURANCE COMPANIES) MODEL SUMMARY ADJUSTED R R

MODEL 1 a

SQUARE

NATUREOFSAMPLE =

STD. ERROR OF

INSURANCE (SELECTED)

THE ESTIMATE

.626(a) .392 .359 7.32945 Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA ANOVA (a, b, c)

MODEL 1

SUM OF SQUARES

df

F

SIG.

Regression 5816.035 9 646.226 12.029 .000(a) Residual 9025.088 168 53.721 Total 14841.124 177 a Predictors: (Constant), LFL, IS, IC, MBEA, MBEP, CR, IIB, IM, IIA b Dependent Variable: OC c Selecting only cases for which NatureofSample = Insurance COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS B 1

MEAN SQUARE

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

37.947 3.055 -.132 1.655 .655 -2.624 1.816 .907 -3.047 -1.127

STD. ERROR

t

SIG.

COEFFICIENTS BETA

4.060 9.347 1.579 .202 1.934 1.160 -.010 -.114 1.210 .139 1.368 1.393 .040 .470 1.078 -.199 -2.434 1.326 .120 1.370 1.374 .060 .660 .897 -.275 -3.397 .760 -.127 -1.483 a Dependent Variable: OC b Selecting only cases for which NatureofSample = Insurance

.000 .055 .910 .173 .639 .016 .173 .510 .001 .140

130

EQUATION 28

OC = 37.947 + 3.055 IIA – 0.132 IIB + 1.655 IM + 0.655 IS –

2.624 IC + 1.816 CR + 0.907 MBEA – 3.047 MBEP – 1.127 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 39 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 7.3294. Our calculated F value of 12.029 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.055), IIB (0.910), IM (0.173), IS (0.639), CR (0.173), MBEA (0.510), and LFL (0.140) are not explanatory variables for subordinate organizational commitment, whereas, IC (0.016), and MBEP (0.001) are explanatory variables for subordinate organizational commitment. Here, we shall note that the IIB, IC, MBEP, and LFL are negatively correlated with subordinate organizational commitment.

131

B-School Directors The following section analyzes the relationship of leadership factors with dependent variables for the directors of business schools, using multiple regression method.

132

TABLE 43 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT (B-SCHOOL DIRECTORS) MODEL SUMMARY ADJUSTED R R

MODEL 1 a

NATUREOFSAMPLE = B-

R

STD. ERROR OF

SCHOOL (SELECTED)

SQUARE

THE ESTIMATE

.763(a) .583 .448 .58068 Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM ANOVA (a, b, c) SUM OF SQUARES df MEAN SQUARE

MODEL 1

SQUARE

F

SIG.

Regression 13.179 9 1.464 4.343 .001(a) Residual 9.441 28 .337 Total 22.620 37 a Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM b Dependent Variable: EE c Selecting only cases for which NatureofSample = B-School COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED COEFFICIENTS

MODEL 1

B (Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

.049 -.098 .246 .318 -.111 .500 .149 -.113 .086 -.018

STD. ERROR

COEFFICIENTS BETA

.772 .256 -.087 .246 .210 .320 .289 .261 -.100 .245 .431 .255 .134 .199 -.085 .180 .077 .141 -.021 a Dependent Variable: EE b Selecting only cases for which NatureofSample = B-School

t

SIG.

.064 -.382 .998 .993 -.426 2.042 .583 -.567 .477 -.127

.950 .706 .327 .329 .673 .051 .565 .575 .637 .900

133

EQUATION 29

EE = 0.049 – 0.098 IIA + 0.246 IIB + 0.318 IM – 0.111 IS + 0.500

IC + 0.149 CR – 0.113 MBEA + 0.086 MBEP – 0.018 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 58 percent of the variance of subordinate extra effort. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.5806. Our calculated F value of 4.343 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.001. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.706), IIB (0.327), IM (0.329), IS (0.673), IC (0.051), CR (0.565), MBEA (0.575), MBEP (0.637), and LFL (0.900) are not explanatory variable for subordinate extra effort. Here, we shall note that the IIA, IS and LFL are negatively correlated with subordinate extra effort.

134

TABLE 44 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS (B-SCHOOL DIRECTORS) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = BMODEL

SCHOOL (SELECTED)

1 a

R SQUARE

THE ESTIMATE

.853(a) .727 .640 .42678 Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM ANOVA (a, b, c) SUM OF SQUARES df MEAN SQUARE

MODEL 1

STD. ERROR OF

F

SIG.

Regression 13.604 9 1.512 8.299 .000(a) Residual 5.100 28 .182 Total 18.704 37 a Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM b Dependent Variable: EFF c Selecting only cases for which NatureofSample = B-School COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS B

1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

.970 -.044 .166 .189 .081 .280 .144 -.069 -.065 -.182

STD. ERROR

COEFFICIENTS

t

SIG.

1.710 -.232 .915 .803 .423 1.554 .769 -.474 -.494 -1.752

.098 .818 .368 .429 .676 .131 .449 .639 .625 .091

BETA

.567 .188 -.043 .181 .156 .235 .189 .192 .080 .180 .265 .187 .143 .146 -.057 .132 -.065 .104 -.232 a Dependent Variable: EFF b Selecting only cases for which NatureofSample = B-School

135

EQUATION 30

EFF = 0.970 – 0.044 IIA + 0.166 IIB + 0.189 IM + 0.081 IS +

0.280 IC + 0.144 CR – 0.069 MBEA – 0.065 MBEP – 0.182 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 72 percent of the variance of subordinate effectiveness. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.4267. Our calculated F value of 8.299 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.818), IIB (0.368), IM (0.429), IS (0.676), IC (0.131), CR (0.449), MBEA (0.639), MBEP (0.625), and LFL (0.091) are not explanatory variable for subordinate effectiveness. Here, we shall note that the IIA, MBEA, MBEP and LFL are negatively correlated with subordinate effectiveness.

136

TABLE 45 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION (B-SCHOOL DIRECTORS) MODEL SUMMARY ADJUSTED R R

SQUARE

NATUREOFSAMPLE = BMODEL

SCHOOL (SELECTED)

1 a

R SQUARE

THE ESTIMATE

.807(a) .652 .540 .60089 Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM ANOVA (a, b, c) SUM OF SQUARES df MEAN SQUARE

MODEL 1

STD. ERROR OF

F

SIG.

Regression 18.943 9 2.105 5.829 .000(a) Residual 10.110 28 .361 Total 29.053 37 a Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM b Dependent Variable: SAT c Selecting only cases for which NatureofSample = B-School COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS B

1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

1.396 -.042 .724 -.133 .132 .101 .157 -.357 .136 -.321

STD. ERROR

COEFFICIENTS

t

SIG.

1.747 -.159 2.841 -.403 .491 .397 .594 -1.733 .727 -2.198

.092 .875 .008 .690 .627 .695 .557 .094 .473 .036

BETA

.799 .265 -.033 .255 .547 .331 -.107 .270 .105 .253 .077 .264 .125 .206 -.237 .186 .107 .146 -.329 a Dependent Variable: SAT b Selecting only cases for which NatureofSample = B-School

137

EQUATION 31

SAT= 1.396 – 0.042 IIA + 0.724 IIB - 0.133 IM + 0.132 IS +

0.101 IC + 0.157 CR – 0.357 MBEA + 0.136 MBEP – 0.321 LFL The final regression model with nine independent variables (individualized influence – attributed, individualized influence – behavior, inspirational motivation, intellectual stimulation, individual consideration, contingent reward, management-by-exception – active, management-by-exception – passive, laissez-faire leadership) explains 65 percent of the variance of subordinate satisfaction. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 0.6008. Our calculated F value of 5.829 is far above 1.00 (α = 0.05), so we see that the regression as a whole is highly significant. We can reach the same conclusion by noting that the output tells us that ―p‖ is 0.000. Because this prob value is less than our significant level of α = 0.05, we conclude that the regression as a whole is significant. Referring to probability value from above table, we can conclude that IIA (0.875), IM (0.690), IS (0.627), IC (0.695), CR (0.557), MBEA (0.094), and MBEP (0.473) are not explanatory variables for subordinate satisfaction, whereas, IIB (0.008), and LFL (0.036) are explanatory variables for subordinate satisfaction. Here, we shall note that the IIA, IM, MBEA, MBEA and LFL are negatively correlated with subordinate satisfaction.

138

TABLE 46 MULTIPLE REGRESSION FOR LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT (B-SCHOOL DIRECTORS)

MODEL SUMMARY ADJUSTED R R

SQUARE STD. ERROR OF THE

MODEL 1

ESTIMATE NatureofSample = BSchool (Selected) R Square .568(a) .322 .104 5.19579 a Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM ANOVA (a, b, c) SUM OF SQUARES df MEAN SQUARE

MODEL 1

F

SIG.

Regression 359.184 9 39.909 1.478 .204(a) Residual 755.895 28 26.996 Total 1115.079 37 a Predictors: (Constant), LFL, MBEA, IC, MBEP, CR, IIB, IS, IIA, IM b Dependent Variable: OC c Selecting only cases for which NatureofSample = B-School COEFFICIENTS (a, b) UNSTANDARDIZED STANDARDIZED

MODEL

COEFFICIENTS B

1

(Constant) IIA IIB IM IS IC CR MBEA MBEP LFL

34.047 -3.449 1.215 .285 .322 2.516 2.846 .738 -.848 2.780

STD. ERROR

COEFFICIENTS

t

SIG.

4.929 -1.503 .551 .100 .138 1.148 1.247 .415 -.526 2.203

.000 .144 .586 .921 .891 .261 .223 .681 .603 .036

BETA

6.907 2.294 -.436 2.203 .148 2.865 .037 2.334 .041 2.191 .309 2.282 .366 1.779 .079 1.612 -.108 1.262 .460 a Dependent Variable: OC b Selecting only cases for which NatureofSample = B-School

139

EQUATION 32

OC = 34.047 – 3.449 IIA + 1.215 IIB + 0.285 IM + 0.322 IS +

2.516 IC + 2.846CR + 0.738 MBEA – 0.848 MBEP + 2.780 LFL The final regression model with nine independent variables (Individualized Influence – Attributed, Individualized Influence – Behavior, Inspirational Motivation, Intellectual Stimulation, Individual Consideration, Contingent Reward, Management-by-Exception – Active, Management-by-Exception – Passive, Laissez-faire Leadership) explains 32 percent of the variance of subordinate organizational commitment. The adjusted R2 indicates no over-fitting of the model and that the results should be generalizable from the perspective of the ratio of observations to variables in the equation. Also the standard error of estimate has been reduced to 5.19. Our calculated F value of 1.478 is not so far above 1.00 (α = 0.05), and p value (0.204) is higher than 0.05. So, we conclude that the model is not significant. Referring to probability value from above table, we can conclude that IIA (0.144), IIB (0.586), IM (0.921), IS (0.891), IC (0.261), CR (0.223), MBEA (0.681), and MBEP (0.603) are not explanatory variables for subordinate organizational commitment, whereas, LFL (0.036) is explanatory variable for subordinate organizational commitment. Here, we shall note that IIA, and MBEA are negatively correlated with subordinate organizational commitment.

140

TABLE 47 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE EXTRA EFFORT INDEPENDENT

BETA

VARIABLE

(STANDARDIZED)

IIA IIA IIA IIA IIB IIB IIB IIB IM IM IM IM IS IS IS IS IC IC IC IC CR CR CR CR MBEA MBEA MBEA MBEA MBEP MBEP MBEP MBEP LFL LFL LFL LFL

-0.087 0.060 0.063 0.092 -0.068 0.210 -0.271 -0.184 0.289 0.254 0.333 0.410 -0.100 0.115 0.160 0.266 -0.065 0.060 0.100 0.431 0.003 0.134 0.135 0.126 -0.085 0.059 0.050 0.082 -0.019 0.077 0.093 0.182 -0.021 -0.113 -0.100 -0.186

SIG

SAMPLE

0.706 0.605 0.399 0.394 0.489 0.327 0.007 0.006 0.329 0.038 0.000 0.000 0.673 0.224 0.020 0.014 0.472 0.349 0.298 0.051 0.977 0.565 0.161 0.075 0.575 0.555 0.424 0.375 0.827 0.637 0.122 0.043 0.900 0.230 0.108 0.038

B-SCHOOL INS Overall SBI SBI B-SCHOOL INS Overall B-SCHOOL SBI Overall INS B-SCHOOL INS Overall SBI INS Overall SBI B-SCHOOL SBI B-SCHOOL INS Overall B-SCHOOL INS Overall SBI SBI B-SCHOOL Overall INS B-SCHOOL INS Overall SBI 141

Hypothesis 5:

Leadership factors are not significantly explanatory variables for subordinate extra effort.

Alternate hypothesis: Leadership factors are significantly explanatory variables for subordinate extra effort. From previous table, we can conclude that three leadership factors (IIB, IM, and IS) are significantly explanatory variables for subordinate extra effort, whereas others (IIA, IC, CR, MBEA, MBEP, and LFL) are not significantly explanatory variables for subordinate extra effort (where we found more than 2 instances having value of more than 0.05). Albeit, for IIB and IS, we found two instances where the value of prob. above 0.05, and for IM, all the values of prob. found to be below 0.05. With that we can conclude that IM is significantly explanatory variable for subordinate extra effort. Here, we shall note the negative sign of coefficient for IIB with subordinate extra effort.

142

TABLE 48 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE EFFECTIVENESS INDEPENDENT

BETA

SIG

SAMPLE

VARIABLE IIA IIA IIA IIA IIB IIB IIB IIB IM IM IM IM IS IS IS IS IC IC IC IC CR CR CR CR MBEA MBEA MBEA MBEA MBEP MBEP MBEP MBEP LFL LFL LFL LFL

(STANDARDIZED) 0.076 -0.006 0.205 -0.043 -0.116 -0.140 -0.112 0.156 0.273 0.315 0.280 0.189 0.142 0.185 0.087 0.080 0.211 0.088 0.264 0.265 0.111 0.127 0.099 0.143 0.012 0.130 -0.095 -0.057 -0.273 -0.254 -0.361 -0.065 0.043 -0.079 0.238 -0.232

0.229 0.952 0.032 0.818 0.040 0.115 0.176 0.368 0.000 0.004 0.003 0.429 0.013 0.054 0.269 0.676 0.000 0.303 0.001 0.131 0.063 0.188 0.215 0.449 0.823 0.118 0.249 0.639 0.000 0.001 0.000 0.625 0.407 0.316 0.003 0.091

Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL 143

Hypothesis 6:

Leadership factors are not significantly explanatory variables for subordinate effectiveness.

Alternate hypothesis: Leadership factors are significantly explanatory variables for subordinate effectiveness. From previous table, we can conclude that three leadership factors (IM, IC and MBEP) are significantly explanatory variables for subordinate effectiveness, whereas others (IIA, IIB, IS, CR, MBEA, and LFL) are not significantly explanatory variables for subordinate effectiveness (where we found more than 2 instances having value of more than 0.05). Albeit, for IC, we found two instances where the value of prob. above 0.05, and for MBEP and IM, we found three instances where the value of prob. found to be below 0.05. With that we can conclude that MBEP and IM are significantly explanatory variables for subordinate effectiveness. Here, we shall note the negative sign of coefficient for MBEP with subordinate effectiveness.

144

TABLE 49 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE SATISFACTION INDEPENDENT

BETA

VARIABLE

(STANDARDIZED)

IIA IIA IIA IIA IIB IIB IIB IIB IM IM IM IM IS IS IS IS IC IC IC IC CR CR CR CR MBEA MBEA MBEA MBEA MBEP MBEP MBEP MBEP LFL LFL LFL LFL

0.023 0.088 -0.037 -0.033 0.112 0.053 0.098 0.547 0.164 0.138 0.251 -0.107 0.205 0.283 0.207 0.105 0.132 0.097 0.163 0.077 0.071 -0.013 0.119 0.125 -0.049 0.002 -0.066 -0.237 0.131 0.102 0.145 0.107 -0.342 -0.313 -0.379 -0.329

SIG

SAMPLE

0.723 0.444 0.682 0.875 0.056 0.610 0.211 0.008 0.023 0.285 0.005 0.690 0.001 0.013 0.006 0.627 0.018 0.341 0.022 0.695 0.253 0.913 0.117 0.557 0.373 0.982 0.400 0.094 0.013 0.270 0.039 0.473 0.000 0.001 0.000 0.036

Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL 145

Hypothesis 7:

Leadership factors are not significantly explanatory variables for subordinate satisfaction.

Alternate hypothesis: Leadership factors are significantly explanatory variables for subordinate satisfaction. From previous table, we can conclude that leadership factors (IM, IS, IC, MBEP, and LFL) are significantly explanatory variables for subordinate satisfaction; whereas others (IIA, IIB, CR, and MBEA) are not significantly explanatory variables for subordinate satisfaction (where we found more than 2 instances having value of more than 0.05). Albeit, for IM, IC, and MBEP, we found two instances where the value of prob. above 0.05, and for MBEP and LFL, we found three instances where the value of prob. found to be below 0.05. With that we can conclude that MBEP and LFL are significantly explanatory variables for subordinate satisfaction. Here, we shall note the negative sign of coefficient for LFL with subordinate satisfaction.

146

TABLE 50 CORRELATION AND SIGNIFICANCE OF LEADERSHIP FACTORS WITH SUBORDINATE ORGANIZATIONAL COMMITMENT INDEPENDENT

BETA

VARIABLE

(STANDARDIZED)

IIA IIA IIA IIA IIB IIB IIB IIB IM IM IM IM IS IS IS IS IC IC IC IC CR CR CR CR MBEA MBEA MBEA MBEA MBEP MBEP MBEP MBEP LFL LFL LFL LFL

0.084 0.192 0.202 -0.436 -0.003 -0.235 -0.010 0.148 0.153 0.192 0.139 0.037 0.01 0.030 0.040 0.041 -0.121 -0.060 -0.199 0.309 0.117 0.070 0.120 0.366 0.101 0.025 0.060 0.079 -0.248 -0.270 -0.275 -0.108 -0.064 -0.012 -0.127 0.460

SIG

SAMPLE

0.286 0.193 0.055 0.144 0.963 0.084 0.910 0.586 0.079 0.271 0.173 0.921 0.887 0.845 0.639 0.891 0.072 0.659 0.016 0.261 0.117 0.639 0.173 0.223 0.139 0.856 0.510 0.681 0.000 0.028 0.001 0.603 0.334 0.921 0.140 0.036

Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL Overall SBI INS B-SCHOOL 147

Hypothesis 8:

Leadership factors are not significantly explanatory variables for subordinate organizational commitment.

Alternate hypothesis: Leadership factors are significantly explanatory variables for subordinate organizational commitment. From previous table, we can conclude that leadership factors (IIA, IIB, IM, IC, IS, CR, MBEA, and LFL) are not significantly explanatory variables for subordinate organizational commitment; whereas MBEP is a significantly explanatory variable for subordinate organizational commitment (where we found more than 2 instances having prob. value of less than 0.05). Here, we shall note the negative sign of coefficient for MBEP with subordinate organizational commitment.

148

4.4 Step 3: Comparative Analysis for Independent Variables between Three Samples (Bank, Insurance, B-School) In this section, we analyze the independent variables (transactional, transformation and laissez-faire leadership) for three samples using Analysis of Variance. TABLE 51 COMPARATIVE ANALYSIS FOR INDEPENDENT VARIABLES FOR THREE SAMPLES USING ANOVA

SUM OF SQUARES LFL

Between Groups Within Groups Total Transactional Between Groups Within Groups Total Transformational Between Groups Within Groups Total Hypothesis 9:

14.055 435.030 449.084 .416 52.643 53.059 6.922 133.195 140.117

MEAN DF

SQUARE

2 376 378 2 376 378 2 376 378

F

SIG.

7.027 6.074 .003 1.157 .208 1.485 .228 .140 3.461 9.770 .000 .354

There is no significant difference in laissez-faire leadership style shown by leaders across three different samples.

Alternate hypothesis: There is significant difference in laissez-faire leadership style shown by leaders across three different samples. The calculated value for the F statistic is 6.074, and the probability of observing such a large value of F if H0 is true (the prob value for this test) is 0.003. With such a small prob value (0.05), we must accept H0 and conclude that there is no significant difference in the transactional leadership style shown by leaders across three different samples. Hypothesis 11:

There is no significant difference in transformational leadership style shown by leaders across three different samples.

Alternate hypothesis: There is significant difference in transformational leadership style shown by leaders across three different samples. The calculated value for the F statistic is 9.770, and the probability of observing such a large value of F if H0 is true (the prob value for this test) is 0.000. With such a small prob value (0.05), we must accept H0 and conclude that there is no significant difference in the subordinate extra effort across three different samples.

151

Hypothesis 13:

There is no significant difference in subordinate effectiveness across three different samples.

Alternate hypothesis: There is significant difference in subordinate effectiveness across three different samples. The calculated value for the F statistic is 3.788, and the probability of observing such a large value of F if H0 is true (the prob value for this test) is 0.023. With such a prob value (