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Leadership
Many researchers and experts in the field of leadership have told that the
Rozalina (2011) made a study about the influence of leadership style and
conflict management to the employee performance in PT. Sinar Sosro regional sales
office at East Java. The purpose of the study is to determine and analyze the
influence of leadership style and conflict management to employee performance at
regional sales office of PT. Sinar Sosro at East Java. This research follows
Rozalinas (2011) recommendation to add job satisfaction variable.
The prior study done by Rozalinas (2011) resulted that leadership style and
conflict management simultaneously affect employee performance. The partial (ttest) showed that both variables do not independently affect. The researcher
concluded that transformational leadership style dimension of stimulus intellectual
gives a greater effect to employee performance, which means the leader support
employees to interact one another to pursue the organizations goals. The researcher
suggested that the next study might add more variables related to human resource
such work environment, salary and compensation, facility, motivation, participation
and variables related to organizational culture and job satisfaction.
Basically, leadership style can be categorized into three major styles
transactional, laissez faire and transformational leaderships (Omar et. al., 2013).
Transactional leaders believe that people are easily motivated by rewards and
punishments. In return there are series of transaction being communicated
between the leaders and their followers to describe how tasks must be done and
explain them the rewards for the job well executed as well as the punishment for
the failure. Transactional leaders are also more interested in seeking their interests
and share the benefits with their followers. A passive kind of leadership style is
laissez-faire leadership. Interaction or relationship between the leader and the
followers is very limited. Laissez-faire leadership represents a non-transactional
kind of leadership style in which important decisions are not made, actions are
postponed, leadership responsibilities ignored, and authority is not used.
Transformational leaders, in contrast focus on personal motivation and
development of their followers. They provide a vision and understanding of
organizational mission; inspire pride, respect and trust among their followers. Burns
(1978) as stated in Srithongrung (2011) explained that transformational leaders
achieve followers cooperation by inspiring them to comprehend with a purpose to
reach beyond their own desire and interest, while transactional leaders get
cooperation from followers by practicing exchanges with them and then monitoring
the exchange relationship. Transformational leadership style enhance employees
interest to satisfied their higher needs, such as self-esteem and actualization, while
transactional leadership style enhance on employees interest in satisfying their
lower-level needs, which are physical and safety needs (Lowe et. al., 1996).
2.2
Transformational Leadership
According to Belonio (2012), transformational leadership is a leadership
style that motivates and encourages the followers by supporting to higher ideals and
moral values which can inspire them to deliver, operate and behave beyond
expectations, and also transform both individuals and organizations. Northouse
(2010) defined transformational leadership as a process that changes people by
affecting emotions, values, ethics, standards, and long-term goals. This
transformation process involves assessing followers' motives, satisfying their
needs, and treating them as human beings. It also involves an unusual form of
influence on the leader's part that moves followers to accomplish more than what is
usually expected from them. Transformational leadership theorists suggest that
leaders must go further than just initiation and consideration of the structure. A
leader, through the four transformational leadership components of idealized
influence, inspirational motivation, intellectual stimulation, and individual
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Intellectual stimulation
The ability of leaders to stimulate the subordinates intellectually through
motivation.
2.3
Job Satisfaction
Job satisfaction has been one of the mostly researched work related result in
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Results of the prior study done by Laurens (2012) showed that job
characteristics have significant effects toward employee engagement. Perceived
Organizational Support (POS) has a significant effect on Employee Engagement.
Employee Engagement has a significant effect on job satisfaction. Job
characteristics and Perceived Organizational Support (POS) simultaneously and
significantly affect employee engagement. Laurens (2011) suggested through these
findings that EF should pay more attention to these variables to gain the engagement
and the satisfaction of the employees. EF may also autonomy to its employees,
retreat or meeting for staff and teachers, and training and encouragement to the
employees to learn and grow professionally.
The concept of job satisfaction has been defined in many different ways.
From the psychological perspective of its relationship with leadership style, the
understanding of job satisfaction includes multi-dimensional attitudes to ones job,
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and that attitudes have cognitive (evaluative), affective (or emotional), and
behavioral components (Judge & Klinger, 2003 as cited in Omar, 2013). This
concept of job satisfaction suggests that the employees form attitudes towards their
jobs by taking into account their feelings, their beliefs, and their behaviors. Robbins
(2002) proposed the idea of personality suitability towards the job which argued
that the satisfaction of someone or the possibility for he/she to leave his/her job is
depend on the level of personality suitability with the job environment. From
organizational management perspective, job satisfaction research has practical
applications for the enhancement of individual lives as well as organizational
effectiveness. The success of any organization is very much depended on the
commitment and hard work on the part of their employees. Because of that, job
satisfaction has been used as a tool to attract and retain the best employees within
the organization (Omar, 2013).
EXIT
VOICE
Destructive
Constructive
NEGLECT
LOYALTY
Passive
Figure 1
Responses to Job Dissatisfaction
Note: Robbins (2007)
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Employees tend to like the job with challenging activity or target, the
activity that gives them chances to use their skills and abilities. Jobs with little
challenge create boredom, but too much challenge will bring frustration and the feel
of failure. Employees also want a reward or compensation system that is not
confusing and meets with their expectations. Employees put a big concern on their
work environment, how they can perform well and be comfortable. Many of the
workers want something from their job that is more than just money or prestige, for
most of employees, to work is also to fulfill their needs of social interaction. That
is why it is important for employee to have friendly and supportive coworkers
(Robbins, 2002). Atmojo (2012) stated the factors that contribute to employee
satisfaction include: activities, compensation, independence, reward, social status
and social services.
2.4
Organizational Commitment
Definitions of organizational commitment have been in vast array from
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Commitment is viewed as attitude that show personal sacrifice made for the
purpose of the organization, do not depend mainly on aid or penalty and indicate a
personal captivation with the organization (Dhamikka et. al., 2012). O'Reilly and
Chatman (1986) gave idea of commitment's three dimensions, which are:
compliance (instrumental involvement of specific, extrinsic rewards), identification
(involvement based on a desire for affiliation) and internalization (involvement
predicted on conformance between individual and organizational values). Crewson
(1997) explained a much more covering conceptualization of organizational
commitment so as it is an individual's identification and involvement in certain
organization. His definition of organizational commitment conjoins three distinct
features. First, a strong axiom and compliance of the organizations goals and values.
The second, the desire to work hard for the organization. The last, the eagerness
and persistence of being a member of the organization. However, identified three
different dimensions of organizational commitment named as identification,
affiliation, and exchange commitment (Dhammika et. al., 2012). Organizational
commitment was further developed and measured as a global concept with three
distinct components. The first is value commitment. It is a strong belief in and
acceptance of the organizations goal and values. The second is effort commitment,
which is a willingness to exert considerable effort on behalf of the organization.
The third is retention commitment, means a definite desire to maintain
organizational membership (Yang, 2012).
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The results of the study of Margono (2011) showed that POS positively
affected affective commitment. Affective commitment has a negative effect on
turnover intention. POS negatively affected on turnover intention. Affective
commitment is confirmed to be a mediating variable between POS and turnover
intention. The recommendation was to increase POS (informal training, firness,
care, values, and appreciation of good performance) so that it would achieve
affective commitment to lower the turnover intention of employees in Toko Emas
Harapan Surabaya. Statistical results of the study done by Margono (2011) proved
that the POS is significant and has positive effect on affective commitment.
Affective commitment was significantly and negatively influence on turnover
intention, the POS directly affect turnover intention. Affective commitment as an
intervening variable or proved to mediate the relationship between POS and
turnover intention.
2.5
Employee Performance
Employees need the appropriate working environment to perform better. A
proper working environment will inspire employees to put up the right attitudes or
behavior to their job. Employees who find their organizations image captivating
and/or positively evaluate their job performance in the organization are likely to
perform a high level of both internal job satisfaction and organizational
commitment (Yurchisin & Park, 2010).
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outcomes. By using work outputs, planner manager will be able to conclude the
quantity criteria to be produced. The second is behavior. In many cases, it is difficult
to determine which are the final outputs of workers activity. The performance of a
group can be evaluated instantly but it is difficult to evaluate each member's
contribution. Behavior can be evaluated through employee's punctuality, providing
monthly report or the appropriateness of manager's leadership style. Study done by
Dhammika et. al. (2012) used five roles to assess employee performance named:
job, career, innovator, team and organization.
2.6
Relationship
between
Transformational
Leadership
and
Job
Satisfaction
In empirical studies it has been concluded that transformational leadership
behavior has a deep and constant influence upon the job satisfaction of employees
(Bogler, 2001; Nemanich & Keller, 2007; Podsakoff et. al., 1990). One conclusion
pointed out that transformational leaders are considered to enhance the job
satisfaction of their subordinates by making employees feel extraordinary (through
individual consideration) and by making them feel they are needed for a higher
purpose (through idealized influence and inspirational motivation). Another
conclusion was job satisfaction is positively related to participative decision making
and to transformational leadership. With regard to the influence of the individual
transformational leadership dimensions, Leithwood et. al. (1996) in Yang (2012)
indicated that transformational leadership behavior with individual consideration
and structuring was positively related to teacher job satisfaction. The study of
Emery and Barker (2007) provides evidence supporting the application of
transformational leadership in its influence to job satisfaction.
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2.7
Relationship
between
Transformational
Leadership
and
Organizational Commitment
Researchers (Koh et. al., 1995; Podsakoff et. al., 1996) concluded that the
dimensions of transformational leadership affect employees organizational
commitment, especially charismatic vision and individual consideration. Other
conclusion also said that these same transformational leadership factors had
significant direct effects on employees commitment to stay in the job. From another
perspective, the transformational leadership factors of vision, inspirational
motivation, and intellectual stimulation were also found to have an impact upon
both affective commitment (Podsakoff et. al., 1996) and continued commitment
(Rafferty & Griffin, 2004) to the organization. Inspirational communication will
display a uniquely positive relationship with affective commitment. The authors
further proposed when the leader provides positive and encouraging messages,
there will be increases in the attractiveness of the organization to individuals, and
this will positively impact on the extent to which individuals identify, and feel
attached to the organization as a whole. It was also indicated that intellectual
stimulation has a unique, positive relationship with both affective and rational
commitment to the organization. The explanation for these results is that when
leaders push followers to consider problems in new perspectives and to become
actively engaged in how the workplace operates, the employees experience an
increased sense of investment in the organization, exhibited by greater effort to earn
the success of that organization. This increased sense of investment increases
commitment to continue to work for the organization (Yang, 2012).
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2.8
managers is that happy workers are productive workers. When satisfaction and
productivity data are gathered for the organization as a whole, it is found that
organizations with more satisfied employees tend to be more effective than
organizations with less satisfied employees. Job satisfaction is one of the criteria
for determining the condition of the organization. Providing effective services is
highly dependent on human resources and employees job satisfaction will have an
affect on the quality of service they perform (Fitzgerald et. al., 1994 as cited in
Crossman et. al., 2002). Jones et. al. (2009) found that there is a significant
relationship between job satisfaction and employee performance. Job satisfaction
or dissatisfaction can also predict employee's behavior. If employees do not like
their work environment, they will respond somehow. It is best for employers to
handle the dissatisfaction rather than trying to control various responses it causes.
2.9
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2.10
Theoretical Framework
Job Satisfaction
Transformational
Leadership
Employee Performance
Organizational
Commitment
Figure 2
Theoretical Framework
Note: Atmojo (2012)
2.12
Hypothesis
This study has the following hypotheses:
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2.13
Operational Framework
Job
Satisfaction
H1+
Transformational
Leadership
Motivation Inspiration
Idealized Influence
Intellectual Stimulation
Individual
Consideration
H3+
Activities
Compensation
Independence
Reward
Social Status
Social Services
H2+
Organizational
Commitment
Employee
Performance
H4+
Job
Career
Innovator
Team
Organization
Affective
Normative
Rational
Figure 3
Figure 3
Operational Framework
Note: Adopted from Atmojo (2012)
The framework is adopted from the model of Atmojo (2012). The model
studied about the influence of transformational leadership on job satisfaction,
organizational commitment and employee performance. Atmojo (2012) found that
transformational leadership through its four indicators gives positive implications
to job satisfaction and organizational commitment, and job satisfaction and
organizational commitment also gives positive implications to employee
performance