International Journal of Accounting & Business Management

Vol. 6 (No.1), April, 2018

ISSN: 2289-4519
www.ftms.edu.my/journals/index.php/journals/ijabm
DOI:10.24924/ijabm/2018.04/v6.iss1.80.94
This work is licensed under a
Creative Commons Attribution 4.0 International License.

Research Paper

LEADERSHIP STYLE AND ITS IMPACT ON EMPLOYEE PERFORMANCE

Joyce Chua
MBA Graduate
Lord Ashcroft International Business School
Anglia Ruskin University, UK
ctsoraya.s@gmail.com

Abdul Basit
Lecturer
School of Accounting & Business Management
FTMS College, Malaysia
Abdulbasit@ftms.edu.my

Zubair Hassan
Senior Lecturer
School of Accounting & Business Management
FTMS College, Malaysia
Zubai7@gmail.com

ABSTRACT
The aim of this study was to determine the impact of leadership style on employee’s performance. A
causal research design was used to carry out this research. Middle management employees ‘from
services sector at different of location in Klang Valley was used. To do this, respondents from a
hearing aid company was chosen. Each respondent should have worked more than 5 years in the
field. A Likert scale from 1-5 was used to collect data, where the questionnaire was tested for its face,
content and construct validity along with reliability of the construct. A sample size of two hundred
and fifty (250) respondents was used using non-probability convenient sampling method. Regression
analysis was conducted to analyses the data using SPSS 21. The result shows that autocratic and
democratic leadership style has positive and significant impact on employee performance. However
we found that laissez-fair leadership style have no significant influence on employee performance.
This suggests that leaders with extremely distinguished styles have more influences on employee
performance as it is more evident throughout their interaction with the immediate supervisor.
Therefore, leaders could adopt innovative strategies using suitable leadership style in order to
achieve work performance at the very best level as well as to gain the long-term success. Therefore
we concluded that the autocratic leadership is useful in the short term and democratic leadership
style is useful in all time horizons to improve employee performance. Future research could consider
employees reporting immediate supervisors for last five years to ensure more constructive feedback
about the leadership style practices by the managers. Also the study should cover a larger sample
using more systematic sampling technique to generalize the result.

Key Terms: Leadership Style, autocratic, democratic and laissez-fair leadership style, employee
performance

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1. INTRODUCTION
This study focus on examining the impact of leadership styles on employee
performance. The historical perspective of leadership indicated that recently leadership is
used as an effective management approach to manage large size organizations (Iqbal, Anwar
& Haidar , 2015). The gradual replacement of personnel administration with human resource
management results integration of leadership styles into effective employee management or
performance (Iqbal et al, 2015). This demands leaders to adapt themselves to various
situation when demand arise to ensure there is effective leadership (Heresy & Blanchard,
1988). Different leadership styles were used based on the amount of direction, decision
making power and empowerment (Iqbal et al, 2015). When it comes to administration the
leadership , situation and performance of employees are loosely connected and let to hang on
their own (Iqbal et al, 2015). This has caused poor employee performance due to the lack of
direction and strategic leadership in managing routine work.

Many researches, in the past examined the performance and factors affecting
employee performance. One of the dominant key factor that have been discussed in the past
researches were leadership such as participative, autocratic, and democratic (Iqbal et al,
2015). Similarly many researches were done to examine the performance and how it was
affected by various leadership styles. Most of the studies were highly lacking the data
collected on Malaysian context, especially on employees performance and leadership style in
commercial service such as ear hearing service providers. The three leadership style was
considered as dominant in the past literature, although no research was conducted to examine
these styles in the hearing aid sector’s working managers to examine at what extent the style
of leadership affected its employees. (Iqbal et al , 2015).)

To achieve the aim of this study, the following objectives are formulated
To examine the impact of autocratic leadership Style on Employee Performances
To examine the impact of democratic leadership Style on Employee Performances
To examine the impact of laisses-fair leadership style on Employee Performances

The rest of the paper is organised with four section. The next section will focus on literature
review, followed by research methods and data collection procedures, data analysis and
discussions and conclusion & recommendations.

2. LITERATURE REVIEW
Leadership is the most cogitating and investigate at organizational variable, the leader
has a potential impact on employee performance (Cummings & Schwab, 1973). The concept
of leadership is originally developed in folk psychology to explain the factor of leadership
style impact on employee (Jaskaran & Sri-Guru, 2014). Leadership is the process by which
a person exerts influence over people and inspires, motivates, and directs their activities to
help achieve group or organizational goals (Jones & George, 2004). Leadership is essentially
a process in which one individual or sometimes a small group of individuals influences the
efforts of others towards the achievement of goals in a given set of circumstances (Cole,
2005). Leadership style is a pattern of behaviours which engaged in by leader when dealing
with employee. Lewin, Leppit, and White (1939) acknowledged three leadership styles such
as autocratic, democratic and Laissez-Faire. Vigoda-Gadot (2007) argued that , every leader
in their organization and operations practices particular leadership style where such styles is
referred as a set of the behaviour patterns, leadership frequently occurs during the constant
organizational work and others knows leaders by leadership. The manager of the
organization is in very cooperation with the employee, the leadership style of these managers

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has a significant impact on employee self-confidence. Consequently it was found that the
employee self-confidence has a positive impact on performance (Shirzad & Zanganeh, 2011).
Jago (1982) argued that the good leaders are made, but not born. If the person has the desire
and determination, he/she can become an effective leader (Jago, 1982). Good leaders
develop through a never-ending process of self-study, education, training, and experience
(Jago, 1982). The other popular definitions of leadership stated that it is more about an
individual who influences a group of people to achieve a common goal (Northouse, 2017).
According to Zeitchik (2012), leadership about inspiring others to trail the vision until it
becomes a shared effort to achieve the vision. Cole (2005) defined leadership as a dynamic
process whereby one man influences others to contribute voluntarily to the realization and
achievement of the goals and objectives.

Leadership style is the most dominant factors that impact employees’ attitudes and
behaviours including organizational commitment. Leadership can be defined as the capacity
to impact a group of employees’ decision, behaviour, recognition of the goal, and work with
confidence and zeal (Adair, 2002). Leader is required to develop the future vision, to
motivate the organizational members, and to achieve the visions and to improve the
performance (Adair, 2002). According to Adair (2002) leadership is the ability to encourage
others to seek out and defined objectives enthusiastically. It is the human factor which binds
a group together and to improve their performance and to direct them towards goals
(Koudri,1999). Also it was suggested that leadership is to deal and cope with change, focus
on the long-term and the big picture, not always keep to save him/herself to take risks, and
concentrating on people and their values, not just only the bottom-line (Koudri, 1999).

The main goal of any organization is to enhance the employee’s job performance that
it could survive in this highly competitive environment. Performance is a multidimensional
construct and an extremely vital criterion that determines organizational successes or failures
(Prasetya & Kato, 2011 July). According to Niranjana and Pattanayak (2005), the
performance of an employee is the result and behavior on a task which can be observed and
evaluated. Niranjana and Pattanayak (2005) also argued that employee performance is the
contribution made by an individual in the accomplishment of organizational goals.
Employee performance can be simply the result of the patterns of action, and bring it out to
satisfy an objective (Ibrahim, Al Sejini, & Al Qassimi, 2004). According to some researches
employee performance consists of directly observable actions of an employee, and also
related to either mental actions or products, such as the answers and decisions (Ibrahim et al
2004). This results in organizational attainment of goals. Ibrahim et al (2004) defined job
performance as an important activity that provides both the goals and methods to achieve the
organizational goals.

Since leadership is one of the key issues that organisation faces and attributes to its
success and failures, a vast majority of literature , in the past, have focus on examining the
impact of leadership and its effects on employee performance or organisational performance.
The similar significant number of studies also has done over in Malaysia. The table below
shows some of the key researches done on Malaysian context in examining the impact of
leadership and its impact on employee performance.

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 Table 1: Key studies on leadership in the study context
No Student study Title Dimension/ Variable
.
1 Nasrah, (2012) The relationship between leadership style and Leadership style
employee performance: A case of federal employee performance,
public sector in Sabah federal public sector in Sabah.

2 Muthuveloo et Impact of Leadership Styles on Employee leadership styles,

al (2014)
Adaptability in Call Center: A Perspective of employee adaptability,
Telecommunication Industry in Malaysia telecommunication industry
3 Long et al Leadership Styles and Employees’ Turnover Leadership style
(2012)
Intention: Exploratory Study of Academic Staff Employees’ turnover
in a Malaysian College Transformation
Transactional
Organization

4 Voon et al The influence of leadership styles on Leadership;

(2011) employees Job satisfaction in public sector transformational;
organizations in Malaysia transactional;
job satisfaction;
working condition;
working assignment
5 Arham ( 2014) Leadership and Performance: The Case of Transformational leadership,
Malaysian Smes In the Services Sector Transactional leadership,
Organizational performance,
Services SMEs, Malaysia.
6 Nasir et al The Relationship of Leadership Styles and Leadership styles,
(2014) organizational performance among IPTA organizational performance,
Academic Leaders in Klang Valley Area, IPTA,
Malaysia Academic leaders
7 Long et al The Impact of Transformational Leadership Transformational leadership
(2014)
Style on Job Satisfaction Followers
Leadership styles
Job satisfaction
Relationship
8 Ali and Tang Leadership Styles, Business Performance Job Job Satisfaction influence
(2016 January) Satisfaction, New Leadership Framework, Business performance
Malaysia

From the past literature, it is obvious that the dominant three style of leadership are
autocratic, democratic, and laisses-faire style of leadership. Therefore these three styles will
be reviewed.

Swarup (2013) argued that autocratic leadership style is a classified leadership style.
It’s a style of leadership where a manager is the most powerful entity and it is the primary
decision maker (Gordon, 2013). This style of leadership is based on the traditional premise
that leaders are good managers who direct and control their people. Autocratic leadership
style should be adapted to the characteristics of the leader, the subordinate, and the nature of
the situation (Mullins, 2007). Mullins (2007) described autocratic leadership is appropriate

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to get the best results during crisis. The attention which given by employee to leadership is
based on the assumption that subordinates are more likely to work effectively for managers
who adopt a certain style of leadership (Mullins, 2007). DuBrin, Dalglish and Miller (2006)
argued that autocratic leader emphasis and considered as a task oriented, and focus on tasks
accomplishment. The autocratic leader monitors and exercises powers with little trust or
confidence on the followers (DurBrin et al, 2006). Due to this attitude, followers in the
system fear and mistrust their leader (Jooste & Fourie, 2009). As autocratic leaders are
appropriated in a crisis, difficult and complex situations or situation where quick decision are
required to make, autocratic leaders become more effective (Jooste & Fourie, 2009).
Autocratic leadership is demonstrated as a controlling, directing, or coercive leader, who
seldom takes decisions basing on input from their subordinates (Bass, 1990). Similarly, with
McClelland, (1975) autocratic leadership is based on personal dominance and authoritarian
behavior that serves the self-interest of the leader, is self-aggrandizing and exploitative of
others. The decision is made without any form of consultation and works when there is no
need for input on the decision. They make plans of each milestone and their followers are
bound to work or follow the rules (Maxwell, 2015). In short, the autocratic leader has full
control of those around him and believes to have the complete authority to treat them as he
wants. This is useful when immediate and quick decision and performance is required.
Dawson (2002) stated that the autocratic style may show great results in a short time period.
Similarly Koontz et al (1978) argued that autocratic leadership is only useful with, such as
“situation of emergency” and “in case where homogenous work force is involved” and where
the leader is wise, just and has considerable under-standing of the followers.

H1: Autocratic Leadership Style has a positive significant impact on employee performance

The Democratic Leader acts to value inputs and commitment via participation, listening
to both the bad and the good news (Lewin et al, 1939). Smith (1998) asserted that the
democratic leaders have a good relationship with the employee results the effectiveness will
and high employee performance. Anderson (1991) also described that democratic leaders as
one who shares decision making with the other members and therefore, democratic leadership
is connected with higher morale. He denied that democratic leadership is associated with low
productivity and high morale and that authoritarian leadership is associated with high
productivity and low morale. Daft (2014) also argued that democratic leader delegates
authority to others to encourages to make employee own decisions and mostly relies on
subordinates’ knowledge to complete the task. The group members have a greater to say in
decision-making, determination of policy, implementation of systems and procedures
(Mullins, 2007). Jooste and Fourie (2009) argued that democratic leadership leads to
improve productivity and job satisfaction. Democratic Leadership style is one of the most
effective leadership style that leads to higher productivity, better contributions from group
members, and increased group morale (Anderson, 1991). Under democratic leadership, the
superiors allows the subordinates to use their abilities to initiative and make contributions
(Anderson, 1991). The leaders also offer support to the subordinates in accomplishing tasks
(Igbaekemen &Odivwri, 2015). In this style, managers’ enable employees to make
suggestions and recommendations on major issues and give subordinates full control and
responsibility for those tasks, encourage subordinates to become good leaders and involved in
leadership and employee development (Iqbal et al 2015). This style provides confidence to
employees who will help them for meeting deadlines, and departmental goals, to provide
efficient team inputs (Iqbal et al, 2015).

H2: Democratic Leadership Style has a positive significant impact on employee performance

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 Leaders who adopt the laissez-faire leadership style exercise little control over the
followers and let the followers have the freedom to carry out their assigned tasks without
direct supervision (Wu & Shiu, 2009). Laissez-faire leadership style, leader never intervenes
the administrative processes and gives limitless freedom to the followers (Karip 1998).
Laissez-faire leadership delegate and hands-off to allow group members to make their own
decisions. Wu and Shiu (2009) argued that this type of leaders have little control over the
employee, and enable employees to carry out their assigned tasks without direct supervision.
Tarsik, Kassim and Nasharudin (2014) found that laissez-faire leadership style provides little
or no direction and gives employees as much freedom as possible. Base on Cole (2005)
laissez-faire leader seldom involved in work. Mullin (2007) also argued that laissez-faire
leader consciously makes decision to pass the focus power to subordinates, and allow them
has freedom of action “do as you think”. Jooste and Fourie (2009) design this leadership as
permissive leadership which is based on the premise that followers are ambitious, creative,
responsible and accept and achieve the goal together with organization Robbins and
Davidhizar (2007) also argued that laissez-fair style is an “abdicates responsibilities, avoid
making decision”. Akpala (1993) found that laisses-faire leaders make decision very slowly
and there can be a great deal of “buck passing”. As a result, the task may not be undertaken
and conditionally become chaotic. Also , some researchers have rejected this results such as
Garg and Ramjee (2013) who found that that there is a weak but significant and negative
correlation between laissez-faire leadership behavior and normative commitment. Also
Chen, Beck, and Amos (2005) found these laissez faire leadership styles created negative
results. Therefore it indicates that laisses-fair is not an important style that boost the
motivation level of workers as compare to other leadership styles (Chaudhry & Javed,
2012).However base don the overall studies, it can be hypothesis as follows:

H3: Laissez Faire Leadership Style has positive significant impact on employee performance

3. RESEARCH DESIGN AND METHODOLOGY

Subjects

The study engaged 216 employees from 6 organizations in Klang Valley, Malaysia.
The majority of the respondents were female 138 (63.9%) and male 78 (36.10%). The ethic
of the Chinese is 112 respondents constituted 51.90%, Malay 62 respondent constituted
28.7%, and 25 Indian respondents constituted 11.6%. It is clear that the 94 (43.5% )
respondents are from age group 21-30 years, 70 (32.4%) respondents are from aged group
of 31-40 years old, and 41 to 50 years is about 39 respondents with 18.10%. There 119
marriage respondents (55.10%) and 90 people (41.70%) still single. In terms of education
level, result show that 97 respondents (36.60%) were bachelor’s degree holder or professional
degree, and 52 respondents (24.10%) just graduated from some of college. In terms of work
experience, 70 employees (32.40%) has work experience of 5 years, 65 respondents (30.10%
) have worked 6 to 10 years, and 27 respondents (12.5%) has worked more than 11 years to
15 years. In terms of income , 74 respondents (34.3%) earned a salary of RM2500.00 to
RM5000.00. About 73 (33.8%) respondents earned less than RM2500.00. 41 people (19%)
earned a salary ranged from RM5000.00 to RM10,000.00 per month.

Procedures

The sample consisted of participants from 6 (six) hearing aid companies. Cochran's
test was used to determine sample size. Sample size of 235 employees was calculated with a
confidence level of 94%. The combined workforce of these companies is approximately
more than 250 staff. Therefore we distributed 250 copies in the Leadership Style

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questionnaires. We received 235 questionnaires from respondents, although 222
questionnaires were successfully completed and returned. We only used 216 after omission
of all questionnaires that have multiple responses and other issues in the questionnaires.

Random sampling method is also used. Simple random sampling was used and
respondents from each department of each company was selected using a lottery. Data
Processing and data analysis involved data coding and analysis (Gatara, 2010 cited in Suzan,
2016). Data analysis was done using quantitative approaches. Descriptive statistics such as
mean and percentages were applied in the data analysis. The results were presented using
tables with explanations on all parameters used. The descriptive statistical method was
applied to analyses quantitative data where data were scored by calculating the percentages,
means and standard deviation.

Research Instrument

Questionnaire was designed to gather the data. It consists of three parts: A, B, and C.

Part – A: deals with demographic details such as sex, education, age, etc.
Part – B: consists of 18 statements to measure the leadership styles of autocratic,
democratic, and laisses faire from employee perspectives
Part-C: Five (5) items to measure employee performance such as productivity,
punctuality, teamwork, skill improvement and efficiency.

By including variables, questionnaire is prepared with five points Likert scaling

system. Then analysis is made with appropriate statistical tools, in order to prove the
objectives of the study and to test the hypotheses. The scale construction was testing its
normality and reliability.

Normality is assessed using kurtosis and skewness of the data distribution. In

multivariate analysis (Ryu, 2011), the data normality is ensured if the absolute value is within
(<0.1) OR (<. 001). This statistic ranges from -1 to +1. Absolute values above 0.2 indicate
great skewness (Olsson, Gassne, & Hansson, 2009). It is more than Six (6) questions (D1,
D2, D6, LF4, EP4, and EP5) which is more than 1 and higher than 2.055) the rest is in an
acceptable range and under the suggested value. It is important to note that these are Six (6)
questions found to be normal during the pilot testing. Since the greater value of those six (6)
questions indicated in Kurtosis’s data set is not considered normal and further reliability
testing was conducted.

Cronbach’s Alpha is a coefficient of reliability, while the inter-item correlation

addresses the correlation between individual items that should exceed or be greater than 0.3
(Hassan & Diallo, 2013). The bench mark value of reliability is 0.7 (Hair, Ringle & Sarstedt,
2011). The following results were obtained about the reliability of the research instrument:

Table: 2: Reliability Test

Variables Number of Items Cronbach’s Alpha
(N = 216)
Autocratic 6 0.673
Democratic 6 0.921
Laissez-faire 6 0.634
Employee Performance 5 0.835
Overall Scale 23 0.808

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4. RESULT AND DISUCSSION
Descriptive Statistics
Table: 3: Mean and Standard Deviation
Variable N Mean Std. Deviation
Autocratic 216 3.12 0.63
Democratic 216 3.64 0.82
Laissez-Faires 216 3.37 0.55
Employee Performance 216 3.76 0.65

The table above shows the overall perception of three different leadership behaviour
of the managers from employee perspectives. Democratic leadership is considered as the
most practiced or displayed behaviour with a mean value of 3.64 (SD=0.682), followed by
laissez-faire with a mean value of 3.37 (SD=0.55) followed by autocratic leadership
behaviour with a mean value of 3.12 (SD=0.63) indicating the least displayed leadership
behaviour is autocratic among the managers. Employee performance scored a mean value of
3.76 (SD=0.65) suggesting that employee performance was seen as high among the
employees.

Correlations
Table 4: Correlation Analysis
Variables Employee performance Autocratic Democratic Laissez-Faires
Employee Performance 1
Autocratic 0.137* 1
Democratic 0.311** -0.130 1
Laissez-faires 0.144* 0.174* 0.446** 1
*.Correlation is significant at the 0.05 level (2-tailed)
**.Correlation is significant at the 0.01 level (2 tailed)

Landau and Everitt (2004) listed that the correlation coefficients range which from “-
1” to “+1” representing perfect negative and positive correlation. Ringim, et.al. (2012)
stated that the general rule of thumb the value should not more than 0.75, similar correlations
of 0.8 or higher are suggested problematic. Any correlation coefficient that is within -1.00 or
+1.00 indicates a perfect correlation between the variables (Hair et al, 2011). Therefore,
variables that are found with Pearson r value that is closer to “-1.00 or +1.00” will be
identified as perfectly related.

The table above suggests that all the leadership styles have a significant and positive
relationship with employee performance. Also laissez-faire style is significant and positively
associated with all the other leadership styles.

Regressions

Table 5: Model Summary of Employee performance

Model Summaryb
Model R R Adjusted R Square Std. Error of the Durbin-Watson
Square Estimate
1 0.361a 0.131 0.118 0.6142 1.993
a. Predictors: (Constant), Laissez-faire, Autocratic, Democratic
b. Dependent Variable: Employee Performance

The general rules of thumb a good fit is considered to predict a minimum of 60%
variation of the dependent variable (Zygnont & Smith, 2014). According to the above table
adjusted R Square is 0.118. Therefore, this model is considered to be a poor fit and it is not a
good fit. The Durbin-Watson statistic (Montgomery, Peck, & Vining, 2001) defined between

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0 and 4 for no autocorrelation. The Durbin-Watson is 1.993 which shows no auto correlation
between selected sample sizes as value falls in a range of 1.5 to 2.5.

Table 6: Regression Coefficientsa

Model Unstandardized Coefficients Standardized t Sig.
Coefficients
B Std. Error Beta
(Constant) 2.298 0.333 6.905 0.000
Autocratic 0.200 0.070 0.191 2.861 0.005
1
Democratic 0.285 0.059 0.358 4.862 0.000
Laissez-faire -0.058 0.089 -0.048 -0.651 0.515
a. Dependent Variable: Employee Performance

According to the table above, autocratic leadership style beta coefficient value is
0.191 with a significant value of 0.005 which is lower than 0.05 (Van Vugt & De Cremer,
1999). Hence the autocratic leadership style is found to have a positive significant impact on
employee performance. Bass (1990) has noticed that Autocratic leadership mostly acts as
controlling, directing, or coercive leader, who seldom takes decisions basing on input from
their subordinates. Employees fell under pressure reported autocratic supervision on the part
of their leaders. However, Dawson (2002) stated that the autocratic style may show great
results in a short time period. H1: (Accepted)

Democratic leadership style has a beta coefficient value of 0.358 with a significant
value of 0.000 which is lower than 0.01 (Van Vugt & De Cremer, 1999). Hence the
Democratic leadership style is found to have a positive and significant impact on employee
performance. Lewin et al (1939) found that democratic leadership style in which members of
the group take a more participative role in the decision-making process, given the opportunity
to participate, ideas are exchanged freely, and discussion is encouraged. However, Akpala
(1993) argued, democratic leadership is claimed to be earliest amongst all other leadership
styles. Yet, Iqbal et al (2015) stated that the democratic leadership style is usually considered
a benefit for the most companies. This style focuses the management that provides guidance
and help to its team and departments while accepting and receiving the inputs from individual
team members. H2: (Accepted)

Laissez Faire leadership style as shown in the table above beta coefficient value is -
0.048 with a significant value of 0.515 which is higher than 0.05 (Van Vugt & De Cremer,
1999). Hence Laissez Faire leadership style is found to have a Negative insignificant impact
on employee performance. According to Ismail, Hussain, and Rashid, (2011) employees who
were allowed to make their own decision would have higher levels of commitment to the
organization. However, Van Vugt et al (2004) argued that Laissez-Faire leader has no
control mechanism for group members by giving freedom to employees is perceived as a
situation in their favour. H3: (Rejected)

5. CONCLUSION
we have identified that the first and two variables which autocratic and democratic
leadership style have a positive and significant impact towards employee’s performance
resulting in these extreme leadership styles can impact on an employee’s performance on
either good or bad ways. However, the Laissez Faire leadership style has a significant
negative impact on employee performance.
A strong leadership positive impact an autocratic style, it can take charge of the
group, assign tasks to different subordinate, and establish solid deadlines for projects to be
finished. The subordinates may accept an autocratic style. It allows employees of the group

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to pay attention on performing specific tasks without concern about making complex
decisions. This also allows the subordinates to become highly skilled at performing certain
duties, which can be beneficial to the group. The autocratic leadership only allow to cater
for the short-term period, as many instances where this leadership style can be problematic.
Democratic leadership has been described as the most effective leadership style, but it
does have some potential downsides. In situations where roles are unclear or time is of the
essence, some-time the democratic leadership would lead to communication failures and
uncompleted projects. In some cases, group members may not have the necessary knowledge
or expertise to make quality contributions to the decision-making process. Democratic
leadership works best in situations, where group members are skilled and eager to share their
knowledge. It is also important to have plenty of time to allow people to contribute, develop
a plan and then vote on the best course of action.
Over all, Laissez-faire leadership can be effective in situations, depend on the group
members are highly skilled, motivated and capable of working on their own. The
conventional term for this style is of 'laissez-faire' leadership style and implies a completely
hands-off approach, many leaders still remain open and available to group members for
consultation and feedback. The negatively happen to Laissez-faire leadership, which is
without the ideal in situations, when the group members lack the knowledge or experience
they need to complete tasks and make decisions. Some people are not good at setting their
own deadlines, managing their own projects and solving problems on their own. In such
situations, the projects can go off-track and deadlines can be missed when team members do
not get enough guidance or feedback from leaders.

Recommendations
The following recommendations were made:
 For Employees:
o To be provide more professional image in the service line. The internal
employee need learn how to self-upgrades and at the same time, seriously
take the responsible for the each of duty.
o To be working more independently. As an executive level to middle
management, leadership needs to seriously review at their work scope, in
order to follow the regulation system of management.
o To be more communication, in order to become closer relationship. All the
branch leaders, managers, or executive need to work closer with the team as to
know clearer about the condition for the daily, weekly and monthly process,
at the same time, can be straightly to know about the work fall, directly to
solve the issue of each of the team members.
o To be seriously applied the punishment at the employee who didn’t care and
work seriously, and follow the instruction of the company. If they are a
person who unable to stop long this, didn’t respect or didn’t care about the
assign work.
 For Leaders or Managers
o The manager could pay more attention and give clear direction to the
subordinate who could steer employees toward a vision firmly that exists in all
the departments.

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 o Capable of being a Straight, Flexible and creative manager/s, their employees
can able to develop their ability in order to improve the performance of
employees with max.
o The managers could pay more attention to employee to that the relationship
between manager and subordinates, who could give each other satisfy of
coordination and improve their performance
o The manager to be trained to use both styles of leadership and along with the
increasing need for new skills and competencies of leadership as a result of
changes in coordination, productive and motivated.
 For companies
o The organization should be providing standard different of compensation
benefit and improved working environment if the absolute potential of
employee is desired
o The organization should be integrated the employee more on the decision
process, the importantly on the issues of concerns.
o Each team should be set up weekly meeting and motivation; Each of
department should set up monthly meeting verify for the new issues and issue
solved, Head of department should hold the quarterly meetings to get
leadership feedback. The Company should hold a yearly meeting to give
reward to the team or department who did the best performance, and focus
more on weak team and get them on the right track.
o The organization looks for more cooperation, it must be fostered between
subordinate and employees.
o The organization may consider in applying a multiple of leadership style
(transformational), for the group of employees, because it is one of good
impact and it will transcend most of leadership styles.
o The Organization should be formulated and express the polices, it will
encourage the manager and employees to be part of the owner of the
organization.
o The organization should be dismissed some of negative employees who might
influence others employees and they can show in a weak performance.

Limitations
The main limitation observed is related to the sample size of the study. All the
respondents were from a single service field, which could influence their work performance
and reward perceptions due to its practices and other factors. The results cannot be universal
or generalize the finding across all the industries or even the own industry due to the limited
companies involved.

Future Research Direction

It is important to examine the impact of leadership style on employee performance by
considering a larger ample size including employees and managers from all the companies in
the industry.

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 Also future researchers can analyses the impact of moderating effect of employee
tenure or age or gender on the relationship between leadership style and employee
performance. Alternatively future researches can examine the mediating effect of personality
or emotional intelligence of leaders on the relationship between leadership style and
employee performance.

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