Effect of Leadership Style on Employee Satisfaction in Selected Banks in Ghana

Abstract

Literature and practice have shown that leaders play a key role in determining the behavioral outcomes of employees who are the main drivers of the vision and goals of their superiors. The study sought to ascertain the effect of leadership style on employee satisfaction using the banking sector of Ghana as the study case. Using the quantitative approach, the descriptive design was used to describe the effect of the three dominant leadership styles mainly the transformational, transactional and laissez-faire leadership on employee satisfaction. Data was collected using standardized questionnaires from 180 leaders and their corresponding subordinates who were selected using the purposive and simple random respectively. The study employed the hierarchical regression to control for demographic variables such as age, gender, level of education, marital status, years of experience and number of children employees have on the effect of leadership styles on employee satisfaction. Furthermore, the study also perused whether there was a difference in leadership style due to the gender of leaders, this enquiry was ascertained using the independent sample t-test. The findings of the study revealed that after controlling for all the demographic factors, transformational leadership style has the most variance in employee satisfaction. On the other hand, as observed from literature, there was no significant difference in leadership style due to gender of leaders. The study recommended that organization develop effective programs for both leaders and potential leaders on transformational thinking, besides, organizations should also adopt thinking walls which will be used for communicating transformational values in the organization.