THE IMPACT OF LEADERSHIP STYLES ON ORGANIZATIONAL PERFORMANCE IN NIGERIA (A CASE STUDY OF THREE SELECTED MANUFACTURING ORGANIZATIONS IN CROSS RIVER STATE)

ABSTRACT

The study aimed at evaluating the impact of leadership styles on organizational performance in Nigeria using three selected manufacturing organizations in Cross River State.  The  evaluation  was  done  through  the  use  of  structured  questionnaire  and interview with questions tailored towards: determining the impact of three types of leadership   styles,   autocratic,   democratic   and   laissez   faire   on   organizational performance; assessing the effect of positive response of the leadership style to high performance variables in promoting maximization of the objectives of the organization; examining factors that influence choice of leadership style in the organizations; finding out the effect of subordinates’ perceptions of their managers’ leadership behaviour on their relationship with management and finally, to ascertain if there is any appropriate leadership style for the organizations under study. The study employed survey research design. The questionnaire was structured in five point Linkert Scale in line with the objectives of the study. Content validity approach was used to ensure that the variables measured were all covered. The instrument was checked for reliability coefficient of

0.95 showing high degree of item consistency. Stratified random sampling technique was used in selecting the manufacturing organizations in Cement Company of Nigeria Limited  and  Niger  Mills  Company  Plc.  A  sample  size  of  282  respondents  was determined from the population of 960 drawn from senior and junior staff of the selected organizations using Taro Yamane sample size determination method. The data generated from the field survey were presented and analyzed using quantitative method like frequency distribution tables and simple percent (%). The test of hypothesis was performed using Correlation, t-test and Chi-square statistical test. The result arising from the primary data test at 95% confidence interval and 3 degree of freedom revealed that  there  is  a  positive and  significant relationship between  leadership  styles  and organizational performance among Nigerian organizations. However, there were variations in the results obtained. For autocratic style of leadership the correlation result showed positive value of 0.92 and significant t-value of 4.06 against a tabulated t-value of 3.18. similarly, the correlation result of democratic style of leadership showed a positive value of 0.95 and significant t-value of 5.27 against a tabulated t-value of 3.182. Furthermore, under laissez faire style of leadership the correlation coefficient result showed a positive value 0.43 and significant t-value of 0.85 against a tabulated t-value of 3.20. these correlation coefficient results confirmed that both autocratic and democratic styles of leadership have positive and significant impact on organizational performance while laissez faire leadership style impacts negatively on organizational performance. The findings further showed that subordinates perceptions of their manager’s   leadership   behaviour   had   direct   impact   on   their   leadership   with management. It was also revealed that certain characteristics in the environment such as; organizational type, the work group, the nature of problem and time factor significantly affect leadership styles(s). Above all, the study revealed that there is no appropriate leadership style for the organizations under study that managers/leaders are at liberty to fashion out leadership style that is most suitable for their organizations to enhance effective performance. To this end, the study recommended that leadership styles(s) in the selected organizations must be such that can enhance the productivity of the employees and by extension, profitability of the organization.

CHAPTER ONE INTRODUCTION

1.1    BACKGROUND OF THE STUDY

The role of leaders in ensuring excellent organizational performance cannot be over emphasized. Adequate motivation, suitable working environment, compensation and efficient communication between managers and subordinates play an important role in promoting this goal. Some researchers have argued that  the  most  common  problems  affecting  organizational  performance  in Nigerian businesses and other institutions are poor attitude to work among the workforce, inefficiency as well as ineffectiveness of leaders in most places. But others have contradicting view. This second school of thought believes that organizations in Nigeria are managed through leadership styles that are strange to  typical  Nigerian  culture.  In  the  wake-up  call  to  address  this  issue, management practitioners in Nigeria have embarked on series of studies in an attempt   to   establish   the   relationship   between   leadership   styles   and organizational performance. Some found that leadership styles are positively related to organizational performance while others found a contrary view. Still, empirical evidence on how each of the leadership styles, among autocratic, democratic and laissez faire impacts on organizational performance was lacking. Also the suitability of any of the above styles of leadership for Nigerian organizations regarding cultural background was also found wanting. This study will be unique in that it will help to fill this gap.

The extent (degree) to which all members of an organization use their abilities and influences in the effective utilization of resources depends upon how well the managers (leaders) of the organization understand and perform their jobs. Muddock and Fulton (1998:126) explain that leadership styles and other processes  of  the  organization  must  be  such  that  can  ensure  maximum probability within all interactions and relationships with the organizations, each member will in the light of his background, values and expectations, view the expenses as supportive and one which can build and maintain his sense of personal worth and importance.

However, this brings out the fact that human beings become members of an organization in order to achieve certain personal objectives. The extent to which they are committed to the organization depends on the degree of their conviction that  their  membership  will  enable  them  to  achieve  their  predetermined objectives. Therefore an individual will support an organization if he believes that through it, his personal objectives and goals will be met, if not the person’s interest in the organization will decline. Consequently, leadership style of the management should be given adequate attention, it the organization intends to achieve its objectives. Thus, the success or failure of any entity lies largely on the leadership and its style.

Leadership style in a managerial context is the general  way a leader behaves towards subordinates in the pursuit of organizational objectives. These include the  degree  to  which  a  manager  delegate’s  authority,  the  modes  of  power

manager employs, and his or her relative concern for human relationship or task orientation (Edem, 2002:122)

Inyang (2006:125) sees leadership styles as unique ways or manners to carrying out leadership functions of motivating and integrating employees with the organization to achieve its vision or objective.

The effectiveness of the leadership styles adopted by managers at work is central in the management of organizations. Etuk (1995:85) observes that failure or success of organization is due to the leadership styles adopted in managing the organizations, which affect the subordinates, the customers and agencies within and outside the organizations.

Besides,  corporate  success  depends  directly  upon  the  style  of  the  chief executive. It is really the style of the chief executive that builds corporate culture, which in turn, create the necessary work culture conducive for management: though sustained organizational achievement can never be a one-man affair. The leader is the only one who plays the crucial role of creating culture, which channels collective energy for corporate growth and success (Khan, 1989:260). Although in context, there may be no leadership style that could be effective in every  situation.  Thus,  there  has  to  be  medications.  Agboli  and  Chikwenu (2006:45) stress that different work situations need different styles if they are to perform optimally.

1.2    STATEMENT OF THE PROBLEM

Over the years, practitioners and writers in the field of management have been involved in a search for a “best” style of leadership which would be successful in most situations. Yet, the evidence from previous research clearly indicates that there is no single all-purpose leadership style. Besides, it has been established that different leaders have styles, and each of these styles has an impact on reforming and/or creating organizational culture which in turn affects organizational performance and  commitment.  The  problem  then is  to  know which leadership style will elicit the best response from the subordinates and make for the highest or best performance (Usoro, 200:98).

However,  some  researchers  have  argued  that  the  most  common problems affecting organizational performance in Nigeria businesses and other institutions are poor attitude to work among the workforce, inefficiency and ineffectiveness of leaders in most places. But others have contradicting view. This second school of thought believes that organizations in Nigeria are managed through leadership styles that are strange to typical Nigerian culture.

Unfortunately, many of our organizations fold up few years after taking off while some that survive do not often show any appreciable degree of growth. The question then is whether leadership styles of the managers or the poor attitude of Nigerian workers is responsible?

In view of the above contending issues, it was therefore, pertinent to evaluate the impact of leadership style on organizational performance in Nigeria using three selected manufacturing organizations in Cross River State.

1.3    OBJECTIVES OF THE STUDY

The main objective of this study is to examine the impact of leadership style on organization performance. The subsidiary objectives include the following:

1.       To   find   out   the   relationship   between   leadership   styles   and organizational performance.

2.       To  assess  the  effect  of  response  of   leadership  style  to  high performance variables in promoting maximization of the objectives of the organization.

3.      To find out the effect of subordinates’ perceptions of their managers’

leadership behaviour on their relationship with management.

4.       To identify the factors that influence choice of leadership style in an organization.

5.       To examine the extent to which the size of an organization influence managers’ leadership behaviour.

6.       To ascertain which of the leadership style is appropriate for Nigerian organizations under study.

1.4    RESEARCH QUESTIONS

For this study to accomplish its desired objectives, some basic research questions which reflected on the objectives of the study are fielded. These questions in specific terms include:

1.       Is there any relationship between leadership styles and organizational performance?

2.       What  are  the  effects  of  response  of   leadership  style  to  high performance variables in promoting maximization of the objectives of the organization?

3.       Do subordinates’ perceptions of their managers’ leadership behaviour affect their relationship with the management?

4.       What are the factors that influence choice of leadership style in an organization?

5.      To what extent does the size of an organization influence managers’

leadership behaviour?

6.       Given  our  peculiar  cultural  environment  is  there  any  appropriate leadership style for Nigerian organizations?

1.5    HYPOTHESES OF THE STUDY

Arising from the statement of the problem, the research objectives and research questions, the following null hypotheses are hereunder formulated for the study.

Hypothesis One

There is no significant relationship between leadership styles and organizational performance.

Hypothesis Two

Response of leadership style to high performance variables does not promote maximization of the objectives of the organization.

Hypothesis Three

Subordinates’ perceptions of their managers’ leadership behaviour does not significantly affect their relationship with the management.

Hypothesis Four

Leadership style of managers does not depend on factors that influence choice of leadership style in an organization.

Hypothesis Five

Size of an organization does not significantly affect managers’ leadership style.

Hypothesis Six

There is no appropriate leadership style for Nigerian organizations under study.

1.6    SIGNIFICANCE OF THE STUDY

The significance of any research study lies in the application of its findings for operational purpose.

It  is  believed  that  this  study  will  be  of  immense  importance  because  the empirical finding will reveal how each of the leadership style impacts on organizational performance.

The study among others seeks to identify the weaknesses or inadequacy of various leadership styles. It is researcher’s belief that this work through its findings will change the perception of managers of the selected organizations and other organizations’ managers with regards to their leadership styles, which are  found  to  be  inimical  growth and  social  economic welfare  of  the  entire workforce.

Finally, it will serve as a benchmark for further research material for students, policy makers, and other scholars who may have growing interest in the operation of business organization.

1.7    SCOPE OF THE STUDY

The scope of this study covers only three manufacturing companies in Cross River State of Nigeria; Dangote Mills Plc, Calabar, Located at the Calabar Free Trade  Zone,  Calabar.  United  Cement  Company  (Nig)  Limited,  located  at Mfamosing in Akpamkpa Local Government Area of Cross River State and Niger Mills Company Plc. Calabar, located at Murtala Mohammed High Way, Calabar. However, the focus of this study is on the impact of various leadership styles on

organizations and how it affects the management of organizations in terms of

achieving organizational goals and objectives. To facilitate a sound grasp of the

subject matter within the thought framework of the objectives of the study and the research questions, the scope of the study covered concept of leadership, leadership theories, leadership styles, as well as other related issues, such as communications and leadership style, factors that influence the choice of leadership style,  when to  use  a  particular leadership style.  Others  are  the relationship between leadership style and organizational performance, Nigeria manager and employees’ productivity, concept of performance and managing subordinate in an organization.

In the time scope, the time lag required to carry out this research work is short. The researcher found it difficult to combine the other challenges of the earth, academic activities with the research work. The time scope is eighteen (18) months.

1.8    LIMITATIONS OF THE STUDY

Conducting this research using manufacturing firms in Cross River State, Nigeria could have shown a more thorough work. However, it was difficult to use all manufacturing firms’ dues to cast of associated logistics and time constraints. Owning to these constraints this study focused on three of the most popular manufacturing organizations in the state. Furthermore, some of the respondents of the selected firms were unwilling to cooperate. Others were apprehensive of the researcher’s intention suspecting that he may disclose their organization’s information to their competitors.

1.9    DEFINITION OF TERMS

For the purpose of clarification and understanding of this study, some concept requires operational definition.

Organization: Some  group  of  people  brought  together  for  the  purpose  of achieving certain objective. An entity designed to achieve a common goal. Organizational  Performance:  Degree  of  how  ell  or  badly  the  organization achieved its set goal

Leader: A Leader is a person who encourage subordinates to perform at a high

level and who also take steps to train, counsel, and mentor subordinates helping them reach their full potential. In this study, it used interchangeably with manager.

Leadership: Leadership is  a  process  of  guiding  and  directing  people,  and influencing their behaviours positively for the benefit of the group to which they belong.

Leadership  Style:  These  are  unique  ways  or  manners  to  carrying  out

leadership functions of motivating and integrating employees with the organization to achieve its vision or objective.

1.10  PROFILE OF SELECTED MANUFACTURING ORGANIZATIONS

Three organizations were selected for the study and they include:

1.      Dangote Mills Company Plc.

2.      Niger Mills Company Plc.

3.      United Cement Company of Nigeria Limited.

Dangote Flour Mills commenced operations in 1999, as a division of Dangote industries Limited – one of Nigeria’s largest and fastes growing conglomerates. Following the strategic decision of D/L to unbundle its various operations, Dangote  Flour  Mills  Plc  was  incorporated  in  2006.  the  restructuring  was

completed in January, 2006, when the Federal High Court sanctioned a scheme of  arrangement  wherein  all  the  assets,  liabilities  and  undertakings  of  the erstwhile flour division of D/K was transferred to Dangote Flour Mills Plc from the initial capacity of 500 MT per day at its Apapa Mill, Dangote Flour expanded rapidly by opening in quick successions, three other flour mills in Kano (2000), Calabar (2001) and Ilorin (2005). Each of the mills started with an installed capacity of 500MT per day but three of them were subsequently expanded resulting into a total installed capacity of 4, 000 MT per day. (http.www.Dangotegroup.com). however, the staff strength of Dangote Mills Plc is currently 340 workers.

Niger Mills Company Plc. Calabar was incorporated 30th  September 1967, with

an authorized share capital of N400, 000.00 divided into 200, 000 ordinary share of N2.00 each fully paid. The authorized share capital later increased to N800,000.00 and subsequently to N1.6 million issued and fully paid for the creation of additional shares. The company became a private limited liability company  with  invitation of  Cross  River  State  government  to  take  up  50% (percent of the shares in the company, which were transferred to Investment Trust Company Limited. The other 50% percent) is being owned by flour mill (Nigeria) Limited, Lagos.

The company had in 1978, entered into management agreement with Flour Mills of Nigeria Limited for effective management operation. The agreement was to last for 3 years and was subject for renewal at the request of Niger Mills Limited.

The agreement was renewed twice, first on late January 1981 and second on

January 1st, 1985.

The  company is  currently employing 300  workers.  It  is  operating the  plant capacity of over 600 tones of wheat per in 3 days in 3 shift of 8 hours. This is an improvement from the original 120 tons of wheat it operated when it was newly established and the pre-1985 capacity of 240 tons of wheat.

The company has been operating successfully over the years except the shut down  from  1986  to  1992  because  of  ban  on  importation of  wheat  by  the government in power then. The current economic depression is yet another problem the company is contending with. Of worthy to note is the fact the company commenced operation in September, 1974.

United  Cement  Company  (Nig)  Limited  was  incorporated  in  April  1964  as Calabar Cement Company. (Calcemco) and has 550 workers, both senior and junior staff. The share structure of the company was state government 53% shares and Federal government 45%. But in 2002, April, it was finally liquidated. The  owners  of  the  company that  is  Cross  River  State  Government sold  it thorough privatization to a company known as Holain and Flour Mill of Nigeria Limited. In September, 2002 the new company under the name United Cement Company (Nig) limited was incorporated. Currently the employees of Unicem are three hundred and twenty workers. The company deals on Portland cement. The government does not own any share. It is solely private. The company is located at Mfamosing in Akamkpa Local Government Area of Cross River State.

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