The Influence Of Effective Leadership On Organizational Performance (A Case Of Selected Small Scale Industries In Aba, Abia State, Nigeria)

Project and Seminar Material for Business Administration and Management BAM

The Influence Of Effective Leadership On Organizational Performance (A Case Of Selected Small Scale Industries In Aba, Abia State, Nigeria)


Abstract


From time immemorial, the role of leaders in ensuring excellent Organizational performance can not be over emphasized. The need for adequate motivation, suitable working environment, compensation and efficient communication between employers and employees are important to promoting excellent organization performance. Though studies on motivation and leadership role amongst employees are well studied in urban centers in developed countries, less could be said of rural centers in developing countries like Nigeria. Therefore, it was important to evaluate leadership and organizational performance in small- scale industries in Aba, Abia state, Nigeria. The evaluation was done through use of questionnaires with questions tailored towards determining: the relationship between leadership and organizational performance, pattern of leadership and the extent it has affected organizational performance, the factors responsible for worker’s low performance and how leadership style has affected labor management relations and productivity in three selected small scale industries in the study area. After analyzing the result with Chi-square, it was concluded that to attain the objectives of small-scale industries in Abia state Nigeria, it was necessary that leadership recognizes the needs of the workers, employ appropriate motivational tool such as promotion of staff based on merit and skills, provide suitable working environment and provide an appropriate leadership style that will encourage free flow of information among employer, superior officers and other employees.


Chapter One


Introduction

1.1 Background of the Study

An organization is a social set up, which has a boundary that separates it from its environment, pursues its own collective goals, and controls its own performance (Hicks and Gullet, 1975). In a formal organization, interactions are rationally coordinated and directed through time on a continuous basis. The person at the helm of affairs is usually the leader.

Kraines (2001) stressed that the word leadership has been used by most disciplines: political science, business executives, social workers and educationist. However, there is large disagreement as regards the exact meaning.

This view was also supported by Taffinder (2006), who gave different definitions to leadership: “a simple meaning: leadership is getting people to do things they have never thought of doing, do not believe are possible or that they do not want to do”. With reference to an organization, he defined leadership as “the action of committing employees to contribute their best to the purpose of the organization”.

While on a complex and more accurate view, he explains that you only know leadership by its consequences – from the fact that individuals or a group of people start to behave in a particular way as a result of the actions of someone else”.

It is important to distinguish between leadership as an organizational function and as a personal quality. According to Bowery (2004) the later entails special combination of personal characteristics, which brings to light qualities and abilities of individuals. The former refers to the distribution of power through out an organization and it brings to focus the pattern of power and authority in the organization.

Defining leadership in its various reflections is very important.

However, it is necessary to buttress what our focus is when any of its definition is referred to and under what condition.

Previous views about leadership show that it is seen as a personal ability. However, Messick and Kramer (2004) were of the opinion that the degree to which individuals’ exhibits leadership depends not only on his characteristics and personal abilities, but also on the characteristics of the situation and environment in which he finds himself.

Messick and Kramer (2004) further explained that since human beings could become members of an organization in order to achieve certain personal objectives, the extent to which they are active members depends on how they are convinced 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 could be met, if not the person’s interest in the organization will decline.

Glantz (2002) further explained that models on human relation shows that there are no essential conflicts that can satisfy workers social and psychological needs. These needs are entirely congruent with organizational goals of effectiveness and productivity.


1.2 Statement of the Problem

The researcher embarked on this study due to the problems.

  1. Inability to determine the pattern of leadership and the extent it affects organizational performance
  2. Inability to identify the factors that are responsible for worker’s low performance in the selected area of study.
  3. Inability to adopt to change by small scale business owners
  4. Over managing i.e not willing to delegate responsibilities.
  5. Inability to plan strategically small scale business owners.

1.3 Objectives of the Study

This research work is aimed at achieving the following end.

  1. To find out the relationship between leadership and organizational performance in organization
  2. To determine the pattern of leadership and the extent it has affected organizational performance.
  3. To identify the factors that is responsible for worker’s low performance in organization.
  4. To find out how leadership style has affected labor management relations and productivity in the selected area of study.
  5. To identify the set goals or objectives of the organization under study and to ascertain whether the organization is achieving that ideal leadership.

1.4 Research Question

The study sought answers to the following research questions.

  1. What pattern of leadership usually affects organization positively?
  2. Does effective leadership enhance organizational growth?
  3. Does leadership style influence workers performance?
  4. Can leadership style affect the performance of small scale businesses in Nigeria?
  5. Which of the leadership style exist in most small scale businesses?

1.5 Research Hypothesis

The following hypotheses were posited to guide us in reaching the research objectives.

Hypothesis I
  • Ho: leadership function and pattern in small scale industries, does not affect the overall performance of the business outfit (organization)
  • Hi: leadership function and pattern in small-scale industries affect the overall performance of the business outfit
Hypothesis II
  • Ho: existence of a favorable working environment does not enhance employees’ high input to their organization in the selected small-scale industries
  • Hi: existence of a conducive working environment enhances employees’ high input to their organization in the selected small scale industries.
Hypothesis III
  • Ho: effective leadership does not promote maximization of the objectives of an organization
  • Hi: effective leadership promotes maximization of the objectives of an organization.

1.6 Scope of the Study

This work will focus on Evaluation of leadership and Organizational

Performance in Small Scale industries in Nigeria; A Case Study of Selected Small Scale industries in Aba, Abia State, Nigeria.

Aba, which is located in eastern part of Nigeria, is chosen because it is one of the strongest commercial nerve centers of the country. The number of small-scale industries springing up from this area is unparalleled when compared to other cities in the country.


1.7 Significance of the Study

It is believed that this study will be of immerse importance because it will reveal the relationship between leadership and organizational performance in Aba, Abia State, Nigeria and how leadership style could be applied to small-scale industries bearing in mind the environmental differences. Secondly, it will be of great importance to the student of business administration who may be heading small-scale industries after their studies.

Finally, this study will enable management and leaders of small scale industries to become aware of the factors that actually motivate their employees to low and high productivity in their work areas.


1.8 Limitation of the Study

There is no gain saying that there are no limitations in research work generally. Any shortcoming that arises in this study is as a result of factors which are beyond the researcher’s control.

Therefore, it will be of more importance to highlight certain militating factors that tend to narrow or limit my scope of study. This project research would have been easier if not for these limitating factors:

1. Time factor:

Time was not on the researchers to consult various sectors of the economy to review employees or given out questionnaire to various institutions on the effect of government revenue policies.

As we all know, time is never our friend. The time scheduled for the completion of this research thesis was too short. As a result, generating information/data was strenuous as it coincides with final year examination period, which needed attention.

2. Finance:

This is another barrier that limited the researcher’s work.

3. Available resources:

Was unavailable for the research work.


1.9 Definition of Terms

Leadership:

The word leadership does not have a single definition because the meaning could often be affected by what it intends to cover. Taffinder (2006) gave the following as definitions of leadership: “a simple meaning: “a simple meaning: leadership is getting people to do things they have never thought of doing, do not believe are possible or that they do not want to do”.

Employer:

An employer can be defined as a person or institution that hires people.

Employee:

This refers to the person being hired (supplier of labor).

Management:

This can be defined as an act of controlling and directing people so as to coordinate and harmonize the group thereby accomplishing goal(s) within and beyond the capacity of people being directed (Dubrin, 2007).

Corporate image:

As explained by Croft and Dalton (2003) corporate image shows or depicts the attributes people give to an organization. In other words it could mean the identity of the organization

Motivation:

Efklides (2001) defined motivation as a conscious act aimed at spurring better results from individuals who may ordinarily not ready to go beyond their capacity.

Organizational environment:

Dubrin (2007) explained that organizational behavior refers to the microenvironment affecting the performance of an organization. This includes suppliers, customers, small-scale industries and the public.

Organizational performance:

This was explained by Stankard (2002) not to mean the performance of the single parts or units of the organization but the product of all interactions taking place in the organization.


Chapter Five


Summary of Findings, Conclusion and Recommendations

5.1 Summary of Findings

  • The primary aim of the research is to establish the relationship between effective leadership style and effectiveness. This focused further on the degree or extent to which it facilitates adequate or high services to the organization. The leadership pattern used in the selected companies in this study contributed to the ineffectiveness of the organizations based on the following reasons:
  • Inadequate materials and equipment to work with, under staffing, break down of machinery and tools, insufficient raw materials, lack of performance measurement and lack of motivation for staff amongst other factors. During this study, the following areas of managerial inadequacies were noticed:
  • Poor spread of executive skills and delegation of power: Power is poorly delegated among staff. This results to inability to take decisions when the manager is not available. Also, use of own initiative by the staff is hampered. Thus, most work is monotonous and lack innovative: since the workers have to carry out their duties according to laid down rules.
  • Rulership by one man: It was observed that the owner of the business is in his own world. Most times he only gives directives and watch: doing a little of everything. There are no formal controls mechanisms employed in these companies and level of expertise of the manager in all areas of the business in questionable. For instance, it was noticed that the owner of the business addresses issues such finances, marketing, distribution, recruitment and production himself. Certainly his degree of expertise will vary in these fields. Thus his over all competence in handling the business is questionable. Other issues that were of importance in this study are mentioned below:
  • The small-scale industries had more of the relations of the owner of the business working there. Most times, this could be seen as a favor to the family members. In another sense, the employer places them in different units of the business to act as checks to other employees.

5.2 Conclusion

Organizations are set up for specific purpose and objectives. People join the organizations because they believe that their personal goals could be met, while they strive to achieve the organization’s objectives. It is the duty of every responsible leader to build an organization that will function effectively. To achieve this, the leader must combine these attributes:

Believe in one-self, will give the leader self-confidence to take up new challenges and ability to motivate others to take up pristine challenges.

The leader must have and show passion for the job. This provides energy and focus needed to drive the organization.

Efficiency is a function of perceived reward. Good motivation is critical for achieving organizational objectives.

Therefore recognizing workers needs is an essential step to planning and motivational efforts.

Hence, every action taken by a leader stimulates a reaction in the employees.

Therefore, we are of the opinion that attainment of the objectives of small-scale industries in Aba, Abia state Nigeria would be borne out of the fact that leadership recognizes the needs of the workers, employ appropriate motivational tool such as promotion of staff based on merit and skills, provide suitable working environment and provide an appropriate leadership style that will encourage free flow of information among employer, superior officers and other employees.


5.3 Recommendation

  1. Due to cultural diversity and peculiar history of the major tribes in Nigeria, the members of each cultural groups are known to have different disposition and attitudes towards work and business activities. Therefore it is important that studies of this nature should be carried out among the other cultural groups in Nigeria; Yoruba and Hausa cultural groups. The success of such study will enable a general conclusion to be made on evaluation of leadership and organizational performance in small-scale industries in Nigeria as a whole.
  2. In achieving the above task, it would be necessary to focus on the level of motivation of employees by employers in the other ethnic or cultural groups in Nigeria. It will also be of interest to study how and determine the extent to which high performance variables promotes maximization of objectives in small scale industries in Igbo land as well as how high performance of small scale industries contribute to the nations economy as a whole.
  3. Comparative studies that will focus on the attitude of employees to work as well as their level of commitment in small scale industries will also be of interest. This aspect is of importance, because irrespective of the cultural heritage of most Nigerians, their background, education and exposure often affect the way and manner they respond and carry out their duties at work.
  4. Focusing into the future of small scale industries in Aba, Abia state, Nigeria, it is important to aspire for leaders who are ready to accommodate and respect their subordinates. The leaders of tomorrow in this area of study need to compensate all staff according to their contributions to the organization. The readiness to motivate and provide adequate training as well as freedom to use individual discretion at some specific levels by employees will further enhance leaders’ role in small scale business in this area.
  5. The future leaders in this area need to have extraordinary level of perception and insight into the realities of the word and themselves.
  6. They also need emotional strength to manage their own and other’s anxiety because learning and change becomes more and more a way of life. Willingness and ability to share power and control according to people’s knowledge and skills is also of necessity if their will be a bright future for leaders in this area of study.
  7. Lastly, championing a course to assist employees meet their personal needs and aspiration by the leader will enhance commitment of the employees to the organization. In effect, this will bring about improved performance, satisfaction of all parties and increase in bottom line of the organization.

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