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The Relationship between Transformational Leadership and Organizational Commitment: A Study on the Bank Employees

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DOI: 10.4236/jssm.2016.93033    2,292 Downloads   3,675 Views   Citations

ABSTRACT

The purpose of this study is to determine the relationship between transformational leadership and organizational commitment. To this end, a theoretical framework regarding transformational leadership and organizational commitment was created and then an application was performed on bank employees in Kars. The results revealed relations between transformational leadership and organizational commitment. Furthermore, results regarding awareness point out an awareness in continuance commitment, which is one of the sub-dimensions of organizational commitment, in terms of whether management task exists or not.

Received 2 June 2016; accepted 21 June 2016; published 24 June 2016

1. Introduction

Developments and changes emerging in every area in recent years have also spread to leadership area, making way for an increase in the significance of transformational leadership, a type of leadership which focuses on changes.

If leaders take notice of individual development needs of their followers, encourage their followers intellectually, put forward high expectations, provide the acceptance of goals as a whole, behave as a role model, and create a shared vision for future, then they can be said to show transformational behaviors. A leader with transformational leadership behaviors aims to transform, encourage and inspire his/her followers for them to perform better than expected [1] . Thus, this way of leadership eases the way of success for corporations and leads to an increase in organizational commitment of employees.

It is no doubt that an employee who works with a good leader will feel more satisfied, leading to an increase in his/her affective commitment to the corporation. Stronger affective commitment will lead to better performance and bring success to corporation, as well. For an employee with high commitment will embrace his/her job and will always do his/her best to go beyond expectations.

This study aims to determine the relationship between the sense of transformational leadership, which has significance for reaching success under tumultuous environmental conditions of our day, and organizational commitment. Within this aim, a study has been conducted on the bank employees working in Kars.

2. Sense of Transformational Leadership

The term “transformational leadership”, which emerged for the first time in Mc Gregor’s Burns’ book “Leadership” in 1978, has been later developed by Bernard Bass et al. as the theory of transformational leadership [2] . Burns has explained the transformational leadership as a leadership style with such properties as charisma among followers and leaders, and a shared vision [3] .

Sense of transformational leadership is generally regarded as an effective leadership style. Studies have revealed lots of positive effects of transformational leadership. Sense of transformational leadership indicates a multi-dimensional leadership style, which puts emphasis on common values and needs rather than individual values and needs of followers, and which encourages its followers to perform beyond expectations [4] . Transformational leadership with its focus on change and transformation appeals to emotions of its followers.

Leadership is of much importance when it comes to activating the followers, benefiting from the resources, organizational innovation, adaptation and performance in accordance with the mission of the organization [5] . Khanin (2007) states that transformational leadership can boost the performance of the followers through charisma, intellectual encouragement, individual attention and inspiration [6] . Transformational leadership puts identification with human values to forefront. Transformation leadership requires some certain management values such as righteousness, positive attitudes, sense of responsibility, and commitment. Endeavor for coordination and cooperation between individuals and the team always finds place in the agenda of a transformational leader [7] . Sense of transformational leadership consists of four dimensions [8] [9] .

1) Charisma (Idealized Effect): Charisma is the power obtained as a result of the changes in the perceptions and attributions of the followers by the properties and behaviors of the leader, by the situation or conditions of the leadership and by the needs of the followers themselves and this power can activate the followers for the leader [10] . If the person who has this power is a charismatic leader, as indicated also by Koçel, s/he is the one who leads other people according to his/her own will thanks to the charismatic features s/he carries within him/herself; s/he is the one who leads the followers to high performances.

Charismatic leaders bear certain properties such as self-confidence, vision-holding, ability to express his/her own visions to others clearly, having strong beliefs in his/her visions, extraordinary behaviors, being perceived as the one who leads the change, sensibility to the environment [11] . A leader changes the behaviors of his/her followers as a role model for them, helps other leaders create vision for the organization, apply ethical principles, encourage leaders to take risks and also encourages the followers perform efficiently under unstable environmental conditions [12] . A leader evokes admiration in his/her followers and boosts their commitment, thanks to the charisma.

2) Inspiration: Inspiration motivates employees to reach organization’s aims successfully and, thus supports leaders in implementing strategies [12] . Inspiration refers to the behaviors of a leader who inspires his/her followers by explaining a challenging mission of the future and activates them [13] . Dimension of inspiration indicates the foundation principles of the organization as a motivation factor rather than the personality of the leader [14] .

3) Intellectual Encouragement: Intellectual encouragement abolishes traditional methods for problem solving and activates employees’ minds to analyze the business problems comprehensively and solve them [12] . A transformational leader strives to create innovation through intellectual encouragement.

4) Individual Attention: Individual attention emerges when a leader pays attention to individual needs of the followers, when s/he helps them improve their abilities and potentials, and s/he puts importance in their emotions [8] . Transformational leaders establish close relationship with their followers, paying individual attention to each of them. Thus, individual needs of the employees are also regarded important. Followers, seeing that their individual needs are paid attention to, will feel that they are important and so they will embrace their jobs more tightly [13] . A transformational leader creates learning opportunities for the followers through individual attention, guides them during the process, sees them as individuals who can make their own decisions, who can analyze and offer solutions for problems, and treats them in accordance with this approach. Individual attention enables the improvement of employees by providing equal opportunities for all employees [14] . Transformational leaders show supportive and formative behaviors when they pay individual attention to their followers [15] .

3. Organizational Commitment

Organizational commitment is defined as “the strength of an individual’s ties with the organization” or “behavioral actions resulting from the commitment of individuals” [16] . Organizational commitment was firstly discussed by Whyte [17] in 1956, and it has been improved by many other researchers such as Porter, in particular, and Mowday, Steers, Allen, Meyer and Becker. Studies conducted since 1956 have revealed the existence of many different notions about commitment.

The most widely accepted definition of organizational commitment is “the relative strength of an individual’s ties with to an organization,” suggested by Mowday, Steers & Porter (1979) [18] . Mowday et al. (1979) define the organizational commitment as the identification level of an individual with a certain organization and his/her attention to the organization. O’Reilley and Chatman (1986), on the other hand, explain the organizational commitment as the psychological commitment that an individual feels towards an organization [19] .

The most accepted classification regarding the organizational commitment types in literature is the organizational commitment classification developed by Meyer and Allen. They have analyzed this classification as affective commitment, continuance commitment and normative commitment [20] . The three-component model of organizational commitment is explained in Figure 1.

Affective Commitment: It indicates the emotional commitment of an employee to the organization and his/her integration with it. The motivation for an employee to stay in that organization is the emotional commitment and identification of him/her with the goals of the organization. Employees who stay in an organization with strong affective commitment continue to work there not because they need it but because they want it [21] .

Source: (Meyer et al. 2002: 22)

Figure 1. Three components of organizational commitment.

The employee regards him/herself as a constituent of the organization and therefore thinks that it is necessary that s/he stays there.

Continuance Commitment: The organizational commitment from a financial aspect brings along the continuance commitment. This type of commitment emphasizes the commitment in proportion to the investment size that an employee has made in the organization. In this sense, continuance commitment points out the awareness of an employee on the costs that s/he will have to bear in case of leaving the job.

Normative Commitment: It highlights the sense of responsibility that an employee feels towards his/her organization to stay there. This type of commitment helps individuals to show some behavioral actions not because they are asked to do so for their personal benefits but because they believe that it is righteous and ethical [21] .

4. The Aim of the Study

The aim of this study is to determine the relationship between sense of transformational leadership and organizational commitment. The points below are taken as basis in accordance with this main aim:

-To determine the transformational level perception of the employees and their organizational commitment level,

-To determine whether there is a difference in terms of demographical variants between transformational leadership and its sub-components, and organizational commitment and its sub-components among bank employees.

4.1. The Scope and Method of the Study

The population of this study consists of approximately 185 bank-employees working in Kars. A 5% of margin of error within the 95% of confidence limit from this population was assumed, and the sample size was measured as 125 accordingly [22] . 135 surveys were delivered in total. The number of returning surveys was 130. 3 of the surveys were left out of the study due to missing and faulty answers. As a consequence, 127 surveys were evaluated for this study.

Data-acquisition tool for this study is the survey form. The survey consists of three parts. The first part includes questions regarding demographic variants. The second part of the survey has been developed to assess the transformational leadership. The survey has been obtained with the translation of the transformational leadership scale into Turkish which has been developed by Podsakoff in order to measure the transformational leadership and for which factor analysis has been made [23] . This scale contains such components as Providing Vision- Inspiration and Being a Proper Role Mode in 8 statements, Providing Acceptance of the Group Aims in 5 statements, Encouraging Intellectually in 4 statements, and Having High Expectations of Success in 3 statements. Statements in this part of the scale have been graded between “I do not agree at all” and “I totally agree”. The third part of the survey has been developed by Meyer and Allen in order to assess the organizational commitment. Each component in this scale consists of 8 statements. These components are Affective Commitment, Continuance Commitment and Normative Commitment.

As the reliability of the data is the basic principle of the scientific study and the indicator of the reliability of the data-acquisition tool, the survey has been subjected to reliability test. The results have been evaluated in accordance with the reliability result which has been stated by Özdamar [24] .

In Table 1, Cronbach Alpha value of the transformational leadership scale of 23 articles has been found 0.961 in the reliability analysis. This result indicates the high-reliability of this scale.

The results of the reliability analysis applied for the sub-components of transformational leadership scale indicate that Cronbach Alpha values range from 0.648 to 0.920, and that the components “providing vision-inspi- ration and being a proper role model”, “providing the acceptance of group aims” “encouraging intellectually” are found to be highly-reliable, whereas “having high expectations for success” and “paying individual attention” are quite-reliable.

In Table 2, Cronbach Alpha value of the organizational commitment scale of 24 articles has been found 0.908 in the reliability analysis. This result indicates the high-reliability of this scale. The results of the reliability analysis applied for the sub-components of the organizational commitment scale indicate that Cronbach Alpha values range from 0.834 to 0.865, and that components affective commitment, continuance commitment and normative commitments are highly reliable.

Table 1. Reliability results on transformational leadership and its sub-components.

Table 2. Reliability results on organizational commitment and its sub-components.

4.2. Findings

4.2.1. Findings on Study Sample

As can be seen by looking at Table 3, 55.1% of the participants are men, while 44.9% are women. While the age range of 5.5% of the participants is between 18 - 24, 75.6% of them are between 25 - 34, 17.3% are between 35 - 44 and 1.6% are between 45 - 54. As for marital status, 51.2% of the participants are married, while 48.8% are single. As for educational background, 17.3% of the participants are graduates of high-school/2-year college, while 72.4% graduated from university, 9.4% have Master degree and 0.08% have PhD. As for titles, 9.4% of the participants are executive officers, 11% assistant executive officers, 4.7% supervisors, 2.4% assistant supervisors, 72.4% officers. While 39.4% of participants have worked at the bank for 1 - 5 years, 46.5% have worked for 6 - 10 years, 13.4% have worked for 11 - 20 years, and 0.8% have worked for 21 - 30 years. 12.6% of employees have management task, while 87.4% do not have. The rate of those who have wanted to work at bank is 86%, while 13.4% have not. 70.1% of participants are satisfied with living in Kars, while 29.9% are not.

4.2.2. Findings on Transformational Leadership, Organizational Commitment and Its Sub-Components

Averages of the answers given by employees for each article are shown in Table 4 and Table 5 to indicate in which level the organization leaders show transformational leadership behaviors and the organizational commitment level of employees. The average values below are regarded as limit for the interpretation of the statements. 1 - 1.79 very low; 1.80 - 2.59 low; 2.60 - 3.39 average; 3.40 - 4.19 high; 4.20 - 5.00 very high.

According to Table 4, While participants’ average of transformational leadership scale is (= 3.55) and the standard deviation is 0.85, the average of the sub-component “providing vision-inspiration and being a proper role model” is (= 3.58), and the standard deviation is 0.93. These findings reveal that “transformational leaders create an efficient vision and inspiration for their followers and become a proper role model” (= 3.55 > 3.40).

The average of the sub-component “providing the acceptance of group aims” is (= 3.56), and the standard deviation is 0.94. This finding indicates that “transformational leaders can make the employees accept the aim of the groups in a high level” (= 3.56 > 3.40).

The average of sub-component “encouraging intellectually” is (= 3.47), and the standard deviation is 0.94. These findings indicate that “transformational leaders can encourage their followers intellectually in a high level” (= 3.47 > 3.40).

The average of sub-component “paying individual attention” is (= 3.44) and the standard deviation is 1.00. These findings indicate that “transformational leaders pay individual attention to their followers in a high level” (= 3.44 > 3.40).

The average of sub-component “having high expectations for success” is (= 3.70) and the standard deviation is 0.80. These findings indicate that “transformational leaders expect overachievement from the employees in a high level” (= 3.70 > 3.40).

When taken all these findings as a whole, institution leaders generally carry transformational leadership properties in a “high” level and they are perceived to show attitudes and behaviors of transformational leadership.

Table 5 shows that, While participants’ average of organizational commitment scale is (= 3.58) and the standard deviation is 0.61, the average of sub-component “affective commitment” is (= 3.60) and the standard deviation is 0.61. These findings indicate that employees have a high level of “affective commitment” (= 3.58 > 3.40).

Table 3. Distribution by demographical data.

Table 4. Average and standard deviation values on transformational leadership and its sub- components.

Table 5. Average and standard deviation values on organizational commitment and its sub- components.

Table 6. Relations between transformational leadership, organizational commitment and its sub-components.

*p < 0.05, **p < 0.01.

The average of sub-component “continuance commitment” is (= 3.54) and the standard deviation is 0.75. These findings indicate that employees have a high level of continuance commitment (= 3.54 > 3.40).

The average of sub-component normative commitment is (= 3.59) and the standard deviation is 0.74. These findings indicate that employees have a high level of normative commitment (= 3.59 > 3.40).

Affective commitment, a sub-component of organizational commitment, has been found to have the highest average. The lowest average, on the other hand, is the continuance commitment.

4.2.3. Findings on Correlation Analysis

In order to analyze the bilateral relations between transformational leadership with its sub-components, and organizational commitment with its sub-components, Pearson correlation analysis has been applied. Findings are presented in Table 6.

There is a positive moderate relationship between transformational leadership scale and organizational commitment scale. There are positive moderate and weak relations between transformational leadership scale and organizational commitment sub-components. The strength of the relations between transformational leadership scale and organizational commitment sub-components ranges from 0.268 to 0.437.

There are positive moderate and weak relations between transformational leadership scale sub-components and organizational commitment scale sub-components. The strength of the relations between these sub-compo- nents ranges from 0.105 to 0.461.

4.2.4. Findings on Differences between Demographical Variants

In order to determine the differences between demographical variants, independent sample t test and one-way analysis of variance have been applied. Results are presented in Tables 7-10.

According to the result of independent sample t test, there is not any significant difference between females and males in terms of participation level to transformational leadership and its sub-components (p > 0.05).

According to the result of independent sample t test, there is not any significant difference between the existence and non-existence of management task in terms of participation level to transformational leadership and its sub-components (p > 0.05).

According to the result of independent sample t test, there is not any significant difference between males and females in terms of participation level to organizational commitment and its sub-components (p > 0.05).

While there is not any significant difference between existence or non-existence of management task for organizational commitment scale and affective commitment and normative commitment sub-components (p > 0.05), there is a significant difference for continuance commitment (p < 0.05). Participation level of employees

Table 7. t test between genders in terms of transformational leadership scale and its sub-components.

Table 8. t test on existence of management task in the institutions in terms of transformational leadership scale and its sub- components.

Table 9. t test between genders in terms of organizational commitment scale and its sub-components.

Table 10. t test on existence of management task in the institution in terms of organizational commitment scale and its sub- components.

*p < 0.05, **p < 0.01.

with a management tasks to “continuance commitment” sub-component is lower than of employees without management task.

4.2.5. Findings on the Analysis of One-Way Variance (Anova) in Terms of Transformational Leadership and Its Sub-Components

Data regarding the Anova analysis applied for transformational leadership and its sub-components are presented in Table 11 & Table 12.

According to the result of the analysis of one-way variance, there is not any significant difference between employees in different age groups in terms of participation level to transformational leadership and its sub- components (p > 0.05).

According to the result of analysis of one-way variance, there is not any significant difference between employees in different age groups in terms of participation level to transformational leadership and its sub-com- ponents (p > 0.05).

4.2.6. Findings on Analyses of One-Way Variance (Anova) Applied for Organizational Commitment and Its Sub-Components

Findings with regard to the One-way Anova Analyses can be seen in Table 13 and Table 14.

According to the result of the analysis of one-way variance, there is not any significant difference between employees in different age groups in terms of participation level to organization commitment and its sub-com- ponents (p > 0.05).

According to the result of analysis of one-way variance, there is not any significant difference between employees with different educational backgrounds in terms of participation level to organizational commitment and its sub-categories (p > 0.05).

5. Conclusions

This study, which has been conducted to determine the relationship between transformational leadership and

Table 11. Analysis of one-way variance on employees in different age groups in terms of transformational leadership and its sub-components.

Table 12. Analysis of one-way variance between employees with different educational backgrounds in terms of transformational leadership and its sub-components.

Table 13. Analysis of one-way variance between employees in different age groups regarding organizational commitment and its sub-components.

Table 14. Analysis of one-way variance between employees with different educational backgrounds in terms of organizational commitment and its sub-components.

*p < 0.05, **p < 0.01.

organizational commitment, indicates the high perception regarding the transformational leadership attitudes and behaviors. “Having great expectations for success” has been found to have the highest average among all the components of transformational leadership. Considering this finding, leaders can be said to carry the features mostly of this component, among all the other components of transformational leadership.

Employees have been determined to have a high level of organizational commitment towards their institutions. Affective commitment, a sub-component of organizational component, has been found to have the highest average. Hence, it is possible to claim that employees adopt the aims of their institutions and they can make sacrifices by working harder in order to reach these aims.

The study has found a positive moderate relationship between the transformational leadership scale and the organizational commitment scale. Positive moderate and weak relations have been found between transformational leadership sub-components and organizational commitment scale sub-component. Hence, it is also possible to claim that leaders increase organizational commitment with their transformational leadership attitudes and behaviors.

No significant difference has been found in t test findings between two genders, and between existence and non-existence of management task in terms of “transformational leadership and its sub-components.” Based on these findings, it is possible to claim that leaders emerge as a result of having transformational leadership attitudes and behaviors equally towards all employees, and thus there is not any difference in perception.

There is not any difference found between genders in terms of organizational commitment and its sub-cate- gories. However, a difference has emerged when it comes to existence of management task. Accordingly, participation level of employees with management task to “continuance commitment” sub-component has been found significantly lower than of employees without management task. Considering this fact, it will be prudent to claim that employees without management task think that if they leave the job their loss will be bigger than of employees with management task.

According to the results of analysis of one-way variance, there has not been any difference found between different age groups and different educational backgrounds in terms of transformational leadership scale and its cub-components. There has not been any difference found between different age groups and different educational backgrounds in terms of organizational commitment and its sub-components, either.

Managers shoulder important responsibilities to increase the organizational commitment of employees. Whether institutions can perform extraordinarily and become preeminent depends on its managers with leadership properties. Therefore, managers should boost the organizational commitment of employees by displaying transformational leadership attitudes and behaviors. Employees with high organizational commitment will always work harder than expected and they will always endeavor more in order to reach institution’s aims. Leaders should act with this awareness. They also should determine the reasons for decrease in organizational commitment and take necessary measurements accordingly.

Under the ever-changing tumultuous environmental conditions of our day, studies on sense of transformational leadership, a type of leadership which focuses on changes, and on organizational commitment, one of the most important key factors for an institution’s success, can be a guiding light for managers. In this sense, how different leadership models with sense of transformational leadership in different institutions can be subject to further researches.

NOTES

*Corresponding author.

Conflicts of Interest

The authors declare no conflicts of interest.

Cite this paper

Gulluce, A. , Kaygin, E. , Kafadar, S. and Atay, M. (2016) The Relationship between Transformational Leadership and Organizational Commitment: A Study on the Bank Employees. Journal of Service Science and Management, 9, 263-275. doi: 10.4236/jssm.2016.93033.

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