Leadership Effectiveness and Job Satisfaction - Research Paper Example

?Leadership Effectiveness and Job Satisfaction Today’s corporate work environment has a strong demand for effective leadership that is able to inspire the workforce to move in the right direction of the mission of the organization. Regardless of the industry, effective leadership has a very critical role in establishing a team that brings out high performance. The current work environment in any industry not only demands an atmosphere that provides a competitive edge and profitability, but also works based on ethical standards, complies with the civic commitments, provides a comfortable working space and job satisfaction (Rowe, 2001). From an employee perspective, job satisfaction has become immensely important as it directly influences many different factors such as employee retention, attrition rates and indirectly influences the contribution to work and productivity. Moreover, employees have a very good choice in front of them and there are chances that they may look for alternate options if they do not get good job satisfaction. Over the past decade, job satisfaction has become very important from the perspective of both the organization as well as the employees. Job satisfaction has two elements associated with it, intrinsic satisfaction as well as extrinsic satisfaction (Weiss, England, & Lofquist, 1967). The aspects of work related challenge, achievement, recognition and ability utilization constitute intrinsic job satisfaction. Extrinsic job satisfaction consists of company policies, company ethics, compensation, benefits, and supervision that are related to the individual attitude towards the work environment (Santana & Robey, 1994). Out of these extrinsic as well as intrinsic factors, work related challenge, recognition, achievement, ability utilization and supervision are directly related to the leadership environment. Hence, one of the key elements that would result in the employees feeling satisfied with their job is the kind of leadership they encounter in their work environment. As with the dynamic work environment, leadership has gone ahead and taken new dimensions that before. An effective leader or manager is no longer just expected to manage the team, but has to demonstrate flexibility, create a good working environment for the staff, develop the team and prove by example. Hence, effective leadership has become extremely critical for any organization to move in the right direction. This study explores the relationship between effective leadership and job satisfaction. It also looks at the various trends in the industry and the theories associated with it. In addition, it also looks at an organization that has increased the job satisfaction my means of effective leadership. Theories of Leadership and Job Satisfaction Before exploring the detailed relationship between Leadership and Job Satisfaction, it is necessary to understand what these terms mean and what different dimensions these terms have in the modern scenario. In recent times, any discussion related to leadership mostly focuses on two main types of leadership – transactional leadership and transformational leadership. Transactional leadership generally is based on leader dominance and the others follow the path set by the leaders in a very straightforward manner. In this type of leadership, compliance ensures rewards and failure to comply leads to negative or punitive action Schermerhorn et al., (2000). However, this method of leadership is losing its popularity in the modern corporate environment because it does not place enough importance on the employees and is solely left to the discretion of the leader. In today’s work environment, the focus is on the way in which employees and leaders collaborate effectively to achieve the mission or the goal. Hence, most organizations have taken the direction towards transformational leadership. Transformational leadership is a way of leadership where the leaders work effectively to change or alter the behaviour of their employees and inspire them to do develop individuality and their own interest in a paralleling manner for the betterment of the organization (Burns, 1978). Hence, the leaders who follow the transformational method of leadership help in improving the understanding by either increasing or changing awareness about issues. As a result of this, they are successful in fostering both excitement as well as inspiration so that the team is able to put in extra efforts in order to achieve their mission. This type of leadership also aims at taking the inputs of the employee on delegation, participation and guidance so that the team works as a cohesive unit. One critique of transformational leadership is that it is mostly prevalent in the upper management levels than at a lower level, where as it would be very effective if introduced at a lower level (Tichy and Uhich, 1984.) Job Satisfaction could be defined as a pleasurable mental or emotional situation due to the attitude that one has towards their profession (Weiss, 2002). In the present era, both transactional and transformational leadership has proved to be of great interest to the scholars. However, transformational leadership is gaining popularity for the immense employee focus that it provides (Laohavichien et al., 2009). While transactional leadership in a broader sense ensures job satisfaction to the employee through indirect means such as rewards on success, transactional leadership leads to a greater level of job satisfaction because of the deep involvement that the employee has in fulfilling the goal. It has also been noticed that transformational leadership leads to innovation, creativity and hence, more job satisfaction (Jansen et al., 2009). With the popularity of transformational method of leadership, the employees have begun to be seen as very critical components of the organizational matrix that can bring about a big change if given the right opportunity at the right time. This has also empowered the employees to contribute much more than they could in a transactional environment. These factors are key components to improving the job satisfaction in an organization. Hence, one of the direct impacts of transformational leadership in the organization is that it helps in employee satisfaction. How to improve Job Satisfaction through Leadership Leaders and Mangers can strive together with their teams to improve the level of job satisfaction that each of the employees have with regard to their particular roles. There are different ways of improving the job satisfaction and here are some important steps that have been considered very effective Understanding Employee Aptitude – One of the most common mistakes that many leaders make in organization is to give less importance to the employee aptitude by focusing more on the end-result. It is also necessary to understand what the employee is interested in and how the interest can be translated into something that would help in achieving the overall goal. For example, guiding the employees and informing them about what they do best would help them develop an attitude. Providing responsibilities based on the aptitude would help the employee achieve the career goal and get a direction. It is necessary for the leadership to understand the interest of the employee to help them achieve the job satisfaction that they may be looking for. Role and Skill Balance & Resource Allocation – One area where the leadership falters is the way in which the resource allocation is carried out. The role allocation should be based on skills rather than randomness or requirement. It is necessary to consider the skills of the employee before assigning a role or a task to them. The assignment should be something that either utilizes or enhances the skill of the employees. This is necessary because it helps the employees become experts in their particular domain and move ahead in the right direction. If the work that an employee is assigned to does not align well with their skills, it is highly likely that they may feel less satisfied that in a job where their skills are utilized well. Rewards and Recognitions – Employees look up to their leaders for recognition and rewards because they serve as excellent motivators for them. If an employee has been working on a project that enhances his or her skills, then one of the expectations that they have would be to get manager recognition. Even if the employee has been doing exceedingly well in the job, rewards and recognition add an extra element of additional job satisfaction. This also works as a good method to retain the employee in the organization as the fact that they get rewarded and recognised in the organization works as a great motivation for them. On the other hand, if an employee feels that he or she is not rewarded or recognized, then that can decrease the level of job satisfaction and could become a reason as to why the employee looks for opportunities outside the company. First hand information- One way in which leaders can influence the level of job satisfaction is by ensuring that the employee receives all the necessary information directly from the manager at the appropriate time. This increases the level of trust and faith that the employee has towards the manager and helps them improve their productivity. This also makes them feel as an integral part of the organization and makes them feel valued. The manner in with the leaders communicate and put across critical details to the employees does influence the way in which the employee understands his role or position in the current set up of the organization. These factors go a long way in indirectly influencing job satisfaction levels of an employee. Trends related to Job Satisfaction and Leadership Due to the fast moving pace of the economy, both leadership and job satisfaction have different connotations based on different scenarios. Initially, leadership had primarily a twofold dimension – task or relation oriented leadership. What this meant was that the relationship between an employee and his or her manager was strictly confined to the task or the relationship related interactions (Hackman, & Oldham, 1976). Post this era, leadership started taking new dimensions with the emergence of charismatic as well as transformational leadership. However, Yukl (2002) developed a leadership model that has another aspect of change management associated with the way in which leadership is carried out and executed. Change oriented leadership is better equipped to handle the frequent changes in today’s environment and it also highlights the processes of effective leadership rather that just focusing on a leader figure. According to the recent trends, a tri dimensional leadership has a direct impact on performance as well as job satisfaction (West and Hirst, 2003). This is because the leadership now focuses on different employee aspects such as opportunity for innovation, preparedness for change, collating employee feedback and taking action based on the feedback. Hence, in such an environment, the importance of the employee as a change agent gets established, contributing to higher levels of job satisfaction. As per the research done by Gill et al (2006), one reason that the employee feels dissatisfied in the job atmosphere could be due to intense stress as well as risks. According to them, effective leadership helps in developing a positive attitude towards work and ensure better role clarity. It also takes off the unnecessary workload of the employees by removal of redundant responsibilities, providing them with exciting challenges rather than just finishing predetermined tasks. Hence, good leadership contributes considerably in increasing the job satisfaction. A relatively new trend concerning leadership is known as empowering leadership. According to this theory, empowering leadership creates a team of effective self-leaders. What this means is that every individual in the group gets an opportunity to develop actions and thought patterns that positively contribute to their own growth as well as the growth of the organization (Yun, Faraj & Sims, 2005). This kind of leadership provides power to the employees and helps them realize their potential in terms of leadership, and proves to be a great satisfaction. As this is a relatively recent development, the companies are still working on adopting this model through partial experiments, hence a lot of research has not yet been done on how the different aspects empowering leadership proves to be influential. Company Case Study Numerous organizations over the world have used the concept of effective leadership to influence the level of job satisfaction that an employee has. One such company that has achieved considerable success is General Electric. Jack Welch was associated with General Electric Company for more than 40 years; he turned it into one of the most admired companies in the world. Even though Welch is considered as a pioneer for bringing about technological change, he also gave considerable importance to the employees in his organization. He respected every individual as someone how could contribute to the company in a very pivotal manner in driving organization change. John Welch aimed to create a new model where the employees would feel fulfilled and satisfied (Slater, 2004). Under his leadership, the managers were provided with a wider scope in which they could build their own small units that would function effectively. Welsh also wanted to harness the collective power of his employees; hence, he empowered the leadership to be more transformational. He aimed to redefine the relationship between an employee and a manager. According to him, an individual is the fountainhead for creativity and innovation. The best way to gain continuous productivity advantage is by releasing the energy and fire in the employees (Slater, 2004). As Jack Welch said, “Any company trying to compete...must figure out a way to engage the mind of nearly every employee” (Wlech & Welch, 2005). This focus on employees led them to believe that they too can work ahead and involve themselves in aspects that can have a direct impact on the company. This had a direct correlation with employee satisfaction in the company and GE began to be admired for its employee friendliness. In 1996, Welch called for a conference of the top 500 leaders of GE with an aim to increase profitability and to improve the individual employee satisfaction of the company. This was done through an adoption of the Six Sigma practices across the company (Pande et al, 2000). The immense value placed on employee satisfaction had a very positive impact on the bottom line of the company and General Electric is considered, as a very good example was effective leadership contributed to employee satisfaction. The employee satisfaction in turn led to the company continuously improving its performance in the competitive atmosphere. The level of freedom and innovation that the leadership provides to the employees has been a big contributor to the high level of employee satisfaction in the company. Summary and Conclusion The influence or the impact that an effective leadership has on job satisfaction for the employees is a complex phenomena due to the dynamically changing economic, social and work environment. Having an effective leader not only helps in steering the group in the right direction, but it also proves to be a key requisite in determining the job satisfaction levels of the employees. The level of work satisfaction can be increased with the help of good leadership in various ways. Having realized this factor, most of the organizations have made strong efforts in order to increase the focus on the employee and improve the job satisfaction by adding additional meaning to the notion of effective leadership. References Burns, J.M. (1978), Leadership, New York: Harper & Row. Gill A, Flaschner AB, Shachar M, 2006. Mitigating stress and burnout by implementing transformational-leadership. International Journal of Contemporary Hospitality Management, 18: 469-481. Hackman, J. R., & Oldham, G. R.(1976), Motivation through the design of work: Test of a theory. Organizational Behavior and Human Performance, 16, 250-279 Jansen, J., Vera, D., and Crossan, M., 2009. “Strategic leadership for exploration and exploitation: The moderating role of environmental dynamism”, The Leadership Quarterly, Vol. 20, pp.5-18. 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