The Effect of Leadership Styles on Organizational Commitment: A Study on Employees of Commercial Bank of Ethiopia
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Date
2024-05-21
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A.A.U
Abstract
This study investigates the effects of leadership styles on organizational commitment in commercial bank of Ethiopia. It examines how three leadership styles - transformational, transactional, and laissez-faire - influence the three dimensions of organizational commitment - affective, continuance and normative. The study has been conducted by both primary and secondary research. The primary research was done using the quantitative approach with the help of survey questionnaire to collect data and the secondary research was used through the review of previously published literatures. A total of 221 data records were analyzed using inferential statistics with the help of the SPSS Version 27.0. Results revealed a positive and consistent impact of transformational leadership on all commitment dimensions. However, Transactional and laissez-faire yielded a mixed result. Transactional leadership showed a negative impact on normative commitment and insignificant impact on affective and continuance commitment. On the other hand, laissez-faire leadership yielded positive impact on continuance and normative commitment and an insignificant impact on affective commitment. The findings highlight the critical role leadership styles play in shaping employee commitment within the Ethiopian banking sector. The study recommends embracing transformational leadership, re-evaluating transactional leadership and consideration of cultural context to fit the context of the bank under study as well as areas that require further exploration.
Key Words: Leadership styles, Transformational Leadership, Transactional Leadership, Laissez-Faire, Organizational Commitment, Affective Commitment, Normative Commitment, and Continuance Commitment.