Leadership in Logistics

industry
Paper Review Submitted by: Kshitij Gupta
Date: 21/04/2016

Title
The influence of leadership styles
on organizational performance of
logistics companies.
By-Saeminah Samad and Zaini Abdullahl: Faculty of Business Management,
Malaysian Institute of transportation.
ISSN: 1993-5250-Medwell Journals 2012

Background (250 words)

The current environment in the organizations has become very
complex and highly competitive. Malaysia as a developing country
is challenging many mature countries in a number of industries.
In today's global and dynamic competitive environment the role of
organizational leader and manager are becoming more crucial.
Empherical studies have strongly put emphasis that leadership is
one of the most important factor for organizational performance
and success.
Empiricalresearch is a way of gaining knowledge by means of
direct and indirect observation or experience.

Literature Review
Leadership Styles: Leadership has been discussed
based on various perspectives
Senior and Flemming described leadership as follow:
1. Concern for task which is also referred as result
oriented
2. Concern for people or people centred or employee
oriented
3. Directive or authoritarian or autocratic leadership
4. Transactional or transformational leadership
According to Flemming the last two have received the

 McCrimon views leadership based on four paradigms:

classic, transactional, transformational and organic.
1. Classic thinking of leadership refer to how the
decisions are made and based on behavioural
perspective-Authoritarian,
Participative
and
Delegative.
2. Transactional Leadership is based on reciprocal
relationship between leaders and followers. The
leaders organise the subordinates work so that their
job is carried out effectively.
3. Transformational leaders is characterised by
charisma,
inspirational
motivation,
intellectual
simulation and individualised consideration.

 Since no single leadership style that indicates the most appropriate

style to all situations researchers have explored various perspective
of leadership approaches in their study.
This study however attempts to highlight the relationship of classical
leadership styles and transformational leadership style with OP.
As classical leadership styles are very influent in Malaysian Logistics
companies, the question is whether classical leadership styles
appropriate enough to transform and make great changes in the
logistics companies.
Thus, this study also proposes the link between
transformations leadership style and organizational
performance. This is because transformational leaders are able to
create great change in both followers and the organization. This
leadership style has also attracted a great deal of attention among
researchers

Literature Review- Organizational

performance
Various measures of organizational performance have been studied
and suggested by researchers. It has been focused on economic
and organisational perspective.
The economic perspective is concerned with the external factors
such as firms competitive positioning and the financial aspect.
The organizational perspective includes the internal environment
which includes quality of services (such as employee satisfaction
and customer satisfaction) quality of product and competitiveness.
Although, several attempts by researchers have been made to
provide a clear definition of organizational performance, however
there is no conclusive definition in terms of some aspects

Leadership Style and organizational

performance- Literature review
Numerous studies have found that leadership has a positive effect on organization
performance despite a significant impact and influence on individual and
organizations.
According to Hartog and Koopman (2002), transactional and transformational
leadership styles have been found to be related to employee satisfaction and
performance, organizational effectiveness, employee turnover and customer
satisfaction.
Preferences on the leadership styles in the Arab world, for example were
influenced by Arab culture and the influence of Islamic and tribalistic values and
beliefs (Yousef, 2000)" Yousef (2000) suggests that Arab culture nurtures
consultative and participative leadership styles"
Likert and Likert (1976) argue that the participative style is more productive in any
culture and environment. Toor and Ofori (2006) conclude that
there is no best leadership style in all situations and it is difficult to determine the
best leadership style.

Research Objective
To Examine the relationship between Leadership Styles
and Organizational Performance
To study the influence of Leadership Style on
Organizational performance.
It also determined the most important leadership style
that influences organizational performance.

Hypothesis
H1a-There is a positive and significant relationship between
autocratic style leadership and organizational performance
H1b-There is a positive and significant relationship between
participative leadership style and organizational performance
H1c-There is a positive and significant relationship between
delegative leadership style and organizational performance
H2a-There is a positive and significant relationship between
transformational leadership aspect of charisma and
organizational performance
H2b-There is a positive and significant relationship between
transformational leadership aspect of inspirational motivation
and organizational performance

 H2c-There is a positive and significant relationship between

transformational leadership aspect of intellectual stimulation and
organizational performance
H2d-There is a positive and significant relationship between
transformational leadership aspect of individual consideration and
organizational performance
H3-Classical leadership style of autocratic, participative and
delegative will influence significantly on organizational performance
H4-Transformational leadership style aspect of charisma,
inspirational motivation, intellectual stimulation and individual
consideration) will influence significantly on organizational
performance
H5-Transformational leadership style will have more impact than
classical leadership style on organizational performance

Research Methadology
Sample and procedure: Participants in the study were
managerial staff in Malaysian logistics companies. Total
200 self administered questionnaires were distributed to
the staff. The 150 useable questionnaires were used in
the statistical analysis representing a response rate of
75% from the sample. The selection of the respondents
was based on the random sampling.

Details of Participants

Measurement
The independent variable of the study was leadership
styles. Leadership styles consists of 31 items and were
measured based on seven dimensions: three classical
leadership styles (autocratic, participative, delegative or
laissez faire) and four transformational leadership aspects
(charisma, inspirational motivation, intellectual stimulation
and individual consideration) developed by the researcher
and adapted from Clark (1998)" Respondents were asked
to response the questionnaires on a range from 1 strongly disagree to 7 - strongly agree"

 Organizational performance was the dependent variable

of this study. Organizational performance which consists
of seven items was measured based on non-financial
aspects:
employee
satisfaction
and
customer
satisfaction. The questionnaire was developed by the
author and adapted from Rosenzweig et a/. (2003) and
King and Zeithaml (2001)
The response options for employee satisfaction and
customer satisfaction items were based on a 7 point
Likert-scale ranging from 1 - strongly disagree to 7 strongly agree" The reliability coefficient for overall
organizational performance components was O.95

Results:

1. The relationship between leadership styles and organizational

performance-(H1a-H1c & H2a-H2c)

Table 2 shows the mean standard deviation, variables and number

of items in the study. It also depicts the reliability coefficients of
the variables ranges from 0.81-O.95 which concurs with Nunnally
minimum acceptable level of 0.70. Meanwhile, Table 3 shows the
correlation analysis of the study variables"

Result 1 continued
Table 3 shows all independent variables are positively
correlated with OP.
Thus all dimensions of classical and transformational
leadership are correlated to each other and are positively
related to OP.
Thus all the hypothesis(H1a-H1c & H2b-H2c) were accepted
so all components to clasical and transformational leadership
styles significantly enhance OP of Malaysian Logistics
Industry.

Result 2- The influence of classic

leadership style on OP (H3)
Only two classic leadership styles had a positive and
significant effect on OP (Participative and Delegative).
However Autocratic style indicates no significant effect
on OP
Thus the data did not provide full support for hypothesis
H3 since autocratic style had no significant impact, so
H3 is partially excepted.
Participative emerged as the most important style.

Result 3-The influence of transformational leadership

style on organizational performance (H4)
All aspects of the transformational leadership had
positive and significant effect on OP(Charisma,
inspirational motivation, individual consideration &
intellectual stimultion)
Charisma resulted to be the most significant among all
four.
This hypothesis is accepted and fully supported.

Result 4-Transformational leadership will

have more impact than classical leadership
styles on organizationalTable
performance
H5
4 shows the regression analysis of
classical leadership styles and aspects of
transformational leadership style on
organizational performance
" Table 4 showed that the variance explained in
organizational performance by classical
leadership styles was 23% while the variance
explained by transformational aspects of
leadership style in organizational performance
was 50%"
The result indicates that the amount of variance
explained by transformational aspects of
leadership style on organizational performance
is higher than by classical leadership styles.
Thus, the H5 of the study was accepted.

Conclusions (200)
1. This study revealed that on overall transformational leadership style
had a more significant effect than classical leadership styles on
organizational performance
2. The results also imply that leaders in Malaysian logistics companies
need to have vision, able to communicate the vision and have the
capability to inspire their followers towards changes in organization.
3. The result also imply that the leaders in these companies need to
have vision, ability to communicate the vision and inspire their
followers towards change in organisation.
4. Transformational Leadership emerged as the most significant in
achieving organizational performance.

Paper Reference
Adler, N., 2002" International Dimensions of Organizational Behavior. 4th Edn., South Western
Publishing, Cincinnati OH.
Anderson, EW", C. Fomell and D.R. Lehmann 1994. Customer satisfaction market share and
profitability: finding from Sweden. Manag . Sci., 33: 525-541
Anderson J.C ., M Rungtusanatllam, R G. Schroeder and S" Devaraj, 1995. A path analytic model of a
theory of quality management underlying the deming management method: Preliminary empirical
findings. peels` ion Sci.. , 26: 637-657.
Barney, J", 1991 Firm resources and sustained competitive advantage" J. Manage., 17: 99-120.
Barney, J.B., 1986" Strategic factor markets: Expectations, luck and business strategy. Manage"
Sci., 32: 1231-1241
Bass, B"M, 1985. Leadership and Performance Beyond Expectations. The Free Press, New York,
ISBN-13:
978-0029018101, Pages: 256"
Bass, B M, 1997 . Does the transformational-transactional leadership paradigm transcend
organizational and
international boundaries" Am. Psych., 52: 130-139.