IMPACT OF PERCEIVED TRANSFORMATIONAL LEADERSHIP STYLE ON JOB PERFORMANCE: INTERVENTION OF PSYCHOLOGICAL EMPOWERMENT

Abstract

The present study aims to examine the impact of perceived transformational leadership style on employees’ job performance and the mediating effect of psychological empowerment in the association between transformational leadership and employee performance. The study was explanatory and a cross sectional survey method was employed. The study population involves the employees working in the public sector organizations in the Northern Province of Sri Lanka. A sample of 684 employees was selected in this study. Leadership style, employee performance and psychological empowerment were measured using standard instruments namely MLQ - Form 5-x, Job Performance Scale and Empowerment Scale respectively. Analysis involves confirmatory factor analysis and structural equation modeling. The results of the study show that perceived transformational leadership style significantly and positively impacts employee performance and employees’ psychological empowerment has a mediating effect in the impact of transformational leadership on employee performance. The study gives an insight that leaders should adopt transformational leadership to promote employee performance and also the leaders should empower the employees to further enhance employee performance. This study suggests that future researchers should cover public sector organizations in other regions and the private sector organizations in Sri Lanka to better understand the relationship between the variables