STRATEGIC Ropo, 1995) In the early 20th century,

STRATEGIC LEADERSHIP TRAITS AND ORGANIZATIONAL
PERFORMANCE: A CASE OF VODAFONE, UGANDA

 

 

BY

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DESMOND ARINAITWE

JAN17/MBA/003U

SCHOOL OF BUSINESS

 

SUPERVISOR

DR OKWADI TUKEI

SCHOOL OF BUSINESS

 

A PROPOSAL SUBMITTED TO THE SCHOOL OF BUSINESS
AND MANAGEMENT IN PARTIAL FULFILMENT OF THE REQUIREMENTS FOR THE AWARD OF A MASTERS
DEGREE IN BUSINESS ADMINISTRATION OF UGANDA TECHNOLOGY AND MANAGEMENT
UNIVERSITY (UTAMU)

JANUARY
2018

 

CHAPTER ONE

INTRODUCTION

1.1 Introduction

The study
seeks to examine the influence of strategic leadership traits on organizational
performance. For this study strategic leadership traits measured in terms of
leaders’ communication skills, commitment and innovativeness will be the independent
variable and organizational performance will be the dependent variable.

This
chapter presents that the background of the
study, statement of the problem, purpose of study, specific objectives of the
study, research questions, research hypotheses and conceptual framework. It
also presents the scope, significance, justification and operational
definitions of key terms used in the study.

1.2 Background to the Study

1.2.1 Historical Background

The
study of leadership has attracted many researchers and produced a large volume
of literature. Some scholars even claim that leadership has been the source of
more extensive investigation than almost any other aspect of human behavior
(Kets de Vries, 1993). Although scholars and philosophers from ancient times
have contributed to the understanding of leadership, there was a particularly
great surge in leadership research in the last century (Coggins, 2016). The
field of leadership research can be divided into: classical approaches –
motivation and trait theories – during the first half of the 20th century;
transactional approaches – behavioral and contingency theories – during the
1950s and 1960s; transformational and charismatic leadership theories during
the 1970s and 1980s; and developments that have been made in the recent decades
driven by both academic scholars and popular press (Coggins, 2014). During last
few decades, however, the field of leadership research has changed considerably
in how researchers think about, study, and define leadership (Hunt and Ropo,
1995)

In
the early 20th century, Frederick Winslow Taylor proposed the practice of
scientific management. This is not a leadership theory per se but changed the
way leader-managers interacted with employees and handled production of a given
product. Through his own work experience and informal education, Taylor (1911)
recognized that employers could get the most out of their workers if they broke
labor projects into their various parts and trained laborers to specialize in
each particular station of production. Taylor timed each part of the production
process in order to improve production to maximum efficiency. In terms of
leadership within organizations, Taylor believed that leaders were born, not
made and assumed there was only one form of effective leadership (1911).

Leadership studies in the early
part of the 20th century focused on what has been referred to as Great Man and
trait theories. Great man theory of leadership proposes that certain men are
born to lead and when crises arise these men step up to take their natural
place (Coggins, 2016). This theory was also related to trait theory. Trait
theory proposes that only men with the in-born characteristics for leadership
will be successful leaders. The search was for the right combination of
characteristics that would lead to effective leading of organizations. Through
two meta-analytical surveys of 124 previous studies in 1948 and 163 others in
1974, R.M. Stogdill identified a list of 10 best traits and skills of effective
leaders.

In 1939, Kurt Lewin worked with
colleagues Lippett and White penned the 1939 publication, called “Patterns of aggressive behavior in
experimentally created social climates.” In that work, Lewin et al.
propsed three leadership types displayed within organizations. Those leadership
styles included:  autocratic, democratic
and laissez faire leadership styles.

Max Weber, a German sociologist,
was the first to propose and describe Charismatic authority (the precursor to
charismatic leadership theory) in his work The Protestant Ethic and the Spirit of Capitalism. Weber
described Charismatic leadership as “a special personality characteristic
that gives a person exceptional powers that result in the person being treated
as a leader.” House (1976) published a theory of charismatic leadership within
which he described the personal characteristics of this type of leader as
“being dominant, having a strong desire to influence others, being
self-confident, and having a strong sense of one’s own moral values”
(Northouse, 2004).

The contingency school of
leadership was popularized by Fred Fiedler (). Contrary to the ‘Taylorists’
who believed there was one best style of leadership and that that style fit all
situations. Fiedler in various works came to believe that best leadership style
was the one that best fit a given situation. Accordingly, Fiedler proposed the
Contingency Theory of Leadership and the Least Preferred Coworker Scale to
establish whether a particular manager-supervisor was a good match for his
leadership assignment.

In 1971, Participative
Leadership was proposed and highlighted by a number of scholars including Dr.
Rensis Likert (1967) and Gary Yukl (1971). Likert is best known for the Likert
Scale, a measurement devise used to measure degrees of acceptance of a given
premise. His theory of leadership styles included the following: exploitative
authoritative, benevolent authoritative, consultative and participative leader.

In the 1980’s the situational
leadership school of thought was proposed by Dr. Paul Hersey and Dr. Ken
Blanchard. By their conceptualization, leaders choose the leadership style
based on the maturity or developmental level of the follower (Coggins, 2016).

The Path-goal school of thought
was developed by Martin G. Evans (1970) and Robert J. House (1971) and based on
Victor Vroom’s Expectancy Theory. The main underlying assumption is that
subordinates will be motivated if (a) they think they are capable of the work
(or high level of self-efficacy); (b) believe their efforts will result in a
certain outcome or reward; and (c) believe the outcome or reward will be
worthwhile.

Robert Greenleaf (1970 and 1977)
published a set of essays proposing a new type of leadership focused on the
follower. That leadership type is servant leadership.

Transformational Leadership has
been the most widely researched form of leadership from the 1980s to 2011.
Transformational leadership was first described by James McGregor Burns and
then expounded upon by Bernard Bass. Burns wrote of this form of leadership in
his important 1978 work Leadership in
which he contrasts the characteristics of transformational leadership with
transactional leadership.

Authentic
leadership is one of the newest proposed leadership styles. In Academic
circles, it was first coined by Dr. Bruce Avolio and Fred Luthans. In 2008,
Walumbwa, Avolio and others devised the Authentic Leadership Questionnaire. In
that publication, they reworked the definition of the leadership concept.
Walumbwa et al viewed Authentic Leadership
as a pattern of leader behavior that draws upon and promotes both positive
psychological capacities and a positive ethical climate, to foster great
self-awareness, an internalized moral perspective, balanced processing of
information, and relational transparency on part of leaders working with
followers, fostering self-development.

These
examples show that leadership research is taking a novel turn which draws on
positive psychology, transcendence, and sustainability (Sosik, 2005; Avolio and
Gardner, 2005).Many authors observe that the contemporary frameworks of
leadership are not sufficient to develop leaders who are capable of facing
future business challenges (Avolio and Gardner, 2005; Luthans and Avolio, 2003;
May et al., 2003). This research therefore attempts to uncover the effect of
strategic leadership traits on employee performance in an organization.

1.2.2 Theoretical Background

The
study will be informed by the Trait Theory of Leadership which was popularized
by Thomas Carlyle.
According to the Trait Theory of Leadership, leaders are born not made.
(i.e., that leadership is largely innate, rather than being developed through
learning). Carlyle
observes that the ability to lead is something that people
were simply born with, Carlyle believed, and not something that could be
developed. Trait theories of leadership identify the specific personality
traits that distinguish leaders from non-leaders. Although the identified
traits vary, the most common are intelligence, self-confidence, determination,
integrity, and sociability.” Hale (2017) extends the leadership trait
theory by identifying traits like communication, passion and communication,
positivity, innovativeness and collaboration.

Early research (Mann, 1959;
Stogdill, 1948) focused on the relationship between personality and leadership,
but reported little supporting evidence. Nevertheless, research interest in
this area continues, with Judge and Bono (2004) reporting that 12% of all
leadership research published between 1990 and 2004 included the keywords
‘personality’ and ‘leadership’. In order to review the evidence of a
substantive relationship between personality and leadership, a meta-analysis
was conducted by Lord, De Vader and Alliger (1986). This included the studies
originally reviewed by Mann (1959) and subsequently published studies. Lord et
al. (1986) demonstrated that there were significant meta-analytic correlations
between leadership perceptions and intelligence, masculinity and dominance. It
is important to note that these characteristics were associated with leadership
perceptions, rather than leader behaviour or performance, and so do not reflect
personal characteristics that may be related to leader effectiveness. A later
meta-analysis, conducted by Judge, Bono, Iles and Gerhardtl (2002), found that
the Big Five personality dimensions (i.e., agreeableness, conscientiousness,
extraversion, neuroticism, and openness) were significant predictors of both
leadership emergence (explaining 28% of the variance) and leader effectiveness
(explaining 15% of the variance).

One of the major criticisms of
trait theory is its simplistic approach; that it fails to take account of other
factors that will influence the development of a successful leader (e.g.,
situational and environmental factors). Recent research, based on identical and
fraternal twins, was able to estimate the heritability of leadership emergence
at 30% (Avery, Zhang, Avolio, Kruegar, 2007). This means that the remaining 70%
is accounted for by situational factors (e.g., exposure to leader role models)
during one’s career. Nevertheless, many organizations use personality
assessment as part of their selection procedures for managerial or leadership
roles. This study will thus use the  
Trait Theory of Leadership to derive the dimensions of strategic
leadership namely communication, innovativeness and commitment on
organizational performance at Vodafone Uganda.

1.2.3 Conceptual Background

According
to Lawal (2013) leadership is the process of influencing others to work
willingly toward an organizational goal with confidence. According to Asika
(2016) “leadership is generally defined simply as the process of influencing
people to direct their efforts towards achievement of some particular goal or
goals”. According to Igbaekemen
(2014), “leadership is generally defined simply as the art of influencing
people so that they will strive willingly towards the achievement of group
goals”. ‘This concept can be seen to include not only willingness to work but
with zeal and confidence. Sikula (2015) sees “leadership simply as an act that
involves influencing others to act toward the attainment of a goal”. According
to Akpala (2015) “leadership has been defined in terms of functions performance
by executives as ‘individuals and as a group”. Therefore, leadership traits
refer to the different strategic leadership characteristics that are linked to successful leadership
across a variety of situations. The study will focus on traits like leaders’
communication skill, commitment and innovativeness.

Yang (2010) defines organizational performance
as a multi-dimensional system of performance measures combining financial
performance, non-financial performance, and managerial performance in the firm.
Financial  performance  is 
generally  defined  as  the  use 
of  outcome-based  financial indicators that are assumed to
reflect the fulfillment of the economic goals of the firm (Venkatraman &
Ramanujam, 2016). It has been widely used to measure business performance in
organizations.  Besides financial  measures, 
non-financial  measures  (also 
called  operational
performance  measures),  such 
as  employee’s  job 
satisfaction  and  managerial performance  etc., 
are  defined  as 
a  broader  conceptualization  of 
organizational performance 
(Kaplan,  1983).  More recently, performance management
literature (Lynch & Cross, 2016; Otley, 2017) suggests that, when
monitoring their firm performance, managers tend to place relatively less
emphasis on traditional financial measures of performance such as return on
investment or net profit.  This is
usually explained in terms of traditional performance measures (the
accounting-based measures or financial measures) which is unable to
satisfactorily reflect firm performance affected by today’s changing business
environments (Hoque, 2014).

Stemming from these concerns, the academic
literature (Van Veen-Dirks & Wijn, 2013) largely supports claims that since
non-financial performance measures focus on a firm’s long-term success factors
such as customer satisfaction, internal business process efficiency, and
innovation, they can best capture the overall performance of organization.
Therefore, a  multi-dimension  system 
of  performance  measures 
combining  financial  and managerial performance will be used in
this study  to  measure the performance of  Vodafone Uganda.

1.2.4 Contextual Background

Vodafone Uganda is Uganda’s leading 4G internet service provider, offering 4G-LTE
high-speed broadband data services in the greater Kampala area and a nationwide
2G/3G voice service (Vodafone, 2018). Our vision is to empower everybody to be
confidently connected. Vodafone Uganda is a subsidiary of Vodafone which is one
of the world’s largest telecommunications companies and provides a range of
services including voice, messaging, data and fixed communications. Vodafone
has mobile operations in 26 countries, partners with mobile networks in 58
more, and fixed broadband operations in 17 markets. As of 31 March 2016,
Vodafone had 462 million mobile customers and 13.4 million fixed broadband
customers (Vodafone, 2018).

 

Vodafone
Uganda is however faced with organizational performance challenges. By the end
of 2015, Vodafone Uganda was recording monthly sales of about Shs 1.5bn. But as
of 2018, the company now struggles to realize sales of a mere Shs 150m per
month. As the sales continue to drop, Vodafone can hardly foot its bills
including paying service providers. As a result of underperformance, the
company has closed most of its shops in Kampala including, Luwum Street,
Metroplex Shopping Mall, Victoria Mall, Entebbe and Freedom City.  The quality of services provided by the
organization is also waning (Aine, 2018). During the festive season of 2017, Vodafone
customers cried foul over internet outages lasting several days. It was later
established that before Christmas over 35 of their masts were switched off for
nonpayment (Aine, 2018). The firm is currently battling suppliers
in court over delayed or non-payment for services. In order to address the
lackluster performance in the organization, management at Vodafone embarked on
leadership and employee capacity building with the hope that equipping leaders
with the adequate skills will improve performance (Vodafone, 2017). Despite
these efforts, the organization is still faced with performance challenges.
This study therefore seeks to determine the influence of strategic leadership
traits on organizational performance at the firm.

1.3
Statement of the Problem

Strategic
leadership traits exhibited by leaders are expected to improve organizational
performance by improving employee performance, organizational profitability,
market growth and expansion and increasing sales (Igbaekemen, 2014). In a bid to improve organizational
performance at Vodafone Uganda, management put in place measures aimed at
improving strategic leadership practices. Such measures included training,
coaching and mentorship programs like the mini-CEO apprenticeships. Despite the
effort, the organization is still faced with both leadership and organizational
performance challenges. The organization is faced with dwindling sales and
revenue. Currently, the monthly sales have reduced from shs 150 billion to less
than 150 million shillings (Aine, 2018). Dwindling sales have forced the firm
to close some of its outlets in the country. The quality of services offered by
the firm has reduced. This is marked by poor internet signals and outages
lasting for several days as reported in December 2017 by Aine (2017). It is
thus this lackluster performance that prompted the study to find out if
strategic leadership traits employed by leaders have had any significant
influence on organizational performance at Vodafone. Without this knowledge,
organizational performance may persist leading to subsequent collapse and
closure of the company in Uganda.

1.4 General Objective of the Study

The study seeks to determine the influence of
strategic leadership traits on organizational performance at Vodafone Uganda

1.5 Specific
Objectives

1.     
To determine the relationship between leaders’ communication
skills on organizational performance at Vodafone, Uganda;

2.     
To assess the influence of leaders’
innovativeness on organizational performance at Vodafone, Uganda;

3.     
To examine the influence of leaders’ commitment
on organizational performance at Vodafone, Uganda.

1.6 Research
Questions

1.     
What is the influence of leaders’ communication
skills on organizational performance at Vodafone, Uganda?

2.     
What is the influence of leaders’
innovativeness on organizational performance at Vodafone, Uganda?

3.     
What is the influence of leaders’ commitment on
organizational performance at Vodafone, Uganda?

 

1.7 Study
Hypotheses

1.     
Leaders’ communication skills have a significant
influence on organizational performance.

2.     
Leaders’ innovativeness has a significant
influence on organizational performance.

3.     
Leaders’ commitment has a significant influence
on organizational performance.

1.8 Conceptual
Framework

Independent Variables (Strategic Leadership
Traits) Dependent Variable (Organizational Performance)

Leaders’ Communication Skills
Verbal
communication skills
Non-Verbal
Communication skills

Leaders’ Innovativeness
·        
New ideas
·        
New
products
·        
New
Services
 
 
 

Leaders’ Commitment
·        
Commitment
to organizations
·        
Commitment
to jobs
·        
Commitment
to goals
 

 
Financial Performance
·        
Profitability
·        
Return on investments
·        
Return on assets
·        
Market expansion
·        
Sales growth
·        
Financial sustainability
Non-Financial Performance
·        
Managerial Performance
·        
Employee Performance
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Figure 1:
Conceptual framework showing the influence
of strategic leadership traits on organizational performance

Source: Adopted from Stodgill (1974) and modified by
the researcher

According
to the conceptual framework above, strategic leadership traits is the
independent variable and organizational performance is the dependent variable.
The conceptual framework assumes that organizational performance improves with
better leader communication skills. It also assumes that organizational
performance improves with increased leaders’ innovativeness and that organizational
performance enhances with increased leadership commitment. Overall, the model
assumes that organizational performance improves with better leadership trait
exhibited by leaders in an organization.  

1.9 Significance of the Study

The findings
of the study will be used by management at Vodafone to improve leadership
practices and organizational performance at the organization. This will improve
organizational performance in terms of profitability, market expansion and
sales growth.

The
study findings will enable leaders at Vodafone, Uganda to adopt strategic
leadership styles which will help improve organizational performance.

The
findings will also be of value to researchers who are interested in conducting
further research on the relationship between strategic leadership traits and
organizational performance in organizations.

The
findings of this study will contribute to the body of knowledge regarding the
relationship between leadership traits and organizational performance, thereby
benefiting researchers and academicians who are interested in the topic.

This
study will also lead to the award of a Master’s Degree in Business
Administration and Management at Uganda Technology and Management University.

 

1.10 Justification of the Study

It is
critical that the influence of leadership traits on organizational performance
at is thoroughly examined. This is because no such study has been conducted in
the organization and yet it is clear that the company is faced with performance
challenges. Thus, it is important that the influence of leadership traits is
examined in order to improve organizational performance.

1.11 Scope of the Study

1.11.1 Content Scope

The
study will examine the influence of leadership traits on organizational
performance at Vodafone, Uganda. The study will specifically examine the
influence of leaders’ communication skills, leaders’ innovativeness and
commitment on organizational performance at Vodafone, Uganda.

1.11.2 Geographical Scope

The
study will be conducted at Vodafone, Uganda.

1.11.3 Time Scope

The study
will focus on the period between 2017 and 2018, because this is the period when
Vodafone, Uganda has been experiencing organizational performance challenges as
reported by Aine (2018).

 

1.12 Operational Definition of Key Terms and
Concepts

Strategic Leadership Traits will
refer to strategic leadership characteristics that are linked to successful leadership
across a variety of situations in the organization.

Leaders’ Communication Skills will
refer to the leaders’ ability to effectively communicate

Leaders’ Innovativeness will
refer to the extent to which leaders can come up with new ideas and products in
order to improve organizational performance.

Leaders’ Commitment will
refer to the bond that the leaders have with the organization

Organizational Performance will
refer to the extent to which the organization achieves its goals and
objectives.