FEMALE LEADERSHIP STYLES AND ORGANIZATIONAL COMMITMENT: A TEST ON SIBU MANUFACTURING COMPANIES
Hii Hiong Lirig
Corporate Master in Business Administration
2013
Pusat Khidmat Maklumat Akademik UNIVERSITI MALAYSIA SARAWAK
F'.KHIDMAT MAKLUMAT AKADEMIK
1IIIIIIIIIIi'ijn111111111 1000246901
FEMALE LEADERSHIP STYLES AND ORGANIZATIONAL COMMITMENT: A TEST ON SIBU MANUFACTURING COMPANIES
By
Hii Hiong Ling (11031928)
A Research Paper Submitted in Partial Fulfillment of the Requirement for the Degree of
Corporate Master in Business Administration
Faculty of Economics and Business UNIVERSITY MALAYSIA SARAWAK
(2013)
APPROVAL PAGE
I certified that I have supervised and read this study and in my opinion it conforms to acceptable
standards of scholarly presentation and is fully adequate in scope and quality as a research paper
for the degree ofCorporate Master in Business Administration.
DR. LOMAYCHIUN
This research paper was submitted to the Faculty of Economics and Business, UNIMAS and is
accepted as partial fulfillment of the requirements for the degree of Corporate Master in Business
Administration.
Professor Dr. Mohammad Affendy Arip Dean, Faculty of Economics and Business UNlMAS
11
STATEMENT OF ORIGINALITY
The work described in this Research Paper, entitled
"FEMALE LEADERSHIP STYLES AND ORGANIZATIONAL COMMITMENT: A
TEST ON smu MANUFACTURING COMPANIES"
is to the best of the author's knowledge that of the author except
where due reference is made.
Date
iii
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ABSTRACT
FEMALE LEADERSHIP STYLES AND ORGANIZATIONAL COMMITMENT: A TEST ON SIBU MANUFACTURING COMPANIES
By
Hii Hiong Ling
(The general objective of this study was to investigate the effect of transformational leadership
and transactional leadership on organizational commitment of manufacturing industry in Sibu,
Sarawak. The present research differs from the previous studies whereby the study 'S framework
has allowed for a better understanding on these relationship~j A total of 190 sets of questionnaires
were distributed to the respondents of the selected manufacturing films in Sibu, Sarawak, and
83.15% of it, which is 158 sets, was returned. There are seven hypotheses were tested in this field
study. The results showed there is a significant relationship between inspirational motivation,
individualized consideration, and management exception by passive towards the organizational
commitment. This study is useful for manufacturing industry to study, and evaluate the effect of
female's transformational leadership and transactional leadership towards the subordinates '
commitment in an organization.
IV
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ABSTRAK
GA Y A KEPIMPINAN WANITA DAN KOMITMEN ORGANISASI: UJIAN AT AS
SYARlKAT PEMBUATAN SIBU
Oleh
Hii Hiong Ling
Objektif umum kajian ini adalah untuk menyiasat kesan kepemimpinan transformasional dan
kepimimpinan transaksional yang akan mempengaruhi komitmen organisasi antara syarikat
pembuatan di Sibu. Kajian ini berbeza daripada kajian lepas di mana rangka kajian ini telah
dibenarkan untuk pemahaman yang lebih baik mengenai hubungan antara kepimpinan
tran fomasional dan kepimpinan transaksional. Sebanyak 190 set soal selidik telah diedarkan
kepada responden daripada syarikat -syarikat pembuatan yang tclah dipilih di Sibu, Sarawak, dan
83. 15% ,yang adalah 158 set soal selidik telah dipulangkan. Terdapat tujuh hipotesis telah diuji
dalam kajian bidang ini. Hasil kajian menunjukkan terdapat hubungan yang signifikan antara
motivasi inspirasi, pertimbangan individu, dan pengecualian pengurusan oleh pasif terhadap
komitmen organisasi. Kajian ini amat berguna untuk industri pembuatan untuk memahami dan
menilai kesan kepimpinan transformasi wanita dan kepimpinan transaksi ke arah komitmen
bawahan dalam sesebuah organisasi.
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ACKNOWLEDGEMENT
First and foremost, I would like to praise the Lord for the blessing and giving me the
strength to face all the challenges. I would like to give the special thanks to my beloved
supervisor, Dr. Lo May Chi un who is the most responsible person in helping me to complete my
study. Despite her heavy pre-occupations, she still provided me with guidance whenever I
approached her for problems that I had encountered in my study.
Besides, I would like to convey my appreciation to the organization which allowed me to
conduct my research in their organization. I would like to thanks all informants whose
Willingness and honestly has helped me to gather my data and complete the study. Thanks for the
participation and cooperation which made this thesis possible.
In addition, I would like to put into words to thank my friends and course mates who are
always shared information and suggestion with me during the process of completing my research
study.
Last but not least, I would like to take this opportunity to express my gratitude to my
beloved family for their constant supports, strong encouragement, assistance and understandings.
I would never come up to this stage where I am right now· without them.
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Pusat Khidmat Makluma{ AKademil{ UNIVERSlTI MALAYSIA SARAWAK
TABLE OF CONTENT
Content
Abstract
Abstrak
Acknowledgement
Table ofcontents
List of Tables
List of Figures
CRAYfER 1: INTRODUCTION
l.0 Background
1.1 The Malaysian Scenario
l.2 Problem Statement
1.3 Research Objectives
1.4 Research Questions
l.5 DefInition of Key Terms
1.5.1 Transformational Leadership
1.5.2 Transactional Leadership
l.5.3 Organizational Commitment
l.6 SignifIcance of Study
1.7 Scope of the Study
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Page Number
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V
VI
VII
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X III
1
3
6
7
9
10
10
11
12
13
14
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1.8
1.9
Limitation of the Study
Organization of Chapters
15
16
CHAPTER 2: LITERATURE REVIEW
2.0 Introduction
2.1
2.2
2.3
2.4
2.5
2.6
2.7
Women in Manufacturing Industry
Organizational Commitment
2.2.1 Affective Commitment
2.2.2 Continuance Commitment
2.2.3 Normative Commitment
Female Leadership
2.3.1 Transformational Leadership
2.3.2 Transactional Leadership
Conceptual Framework
Justification of Framework
Development of Hypothesis
2.6.1 Transformational Leadership and
Commitment
2.6.2 Transactional Leadership and
Commitment
Conclusion
Organizational
Organizational
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17
19
23
24
25
26
31
35
38
39
40
40
41
42
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CHAPTER 3: RESEARCH METHODOLOGY
3.0 Introduction 43
3.1 Research Site 43
3.2 Research Design 44
3.2.1 Population and Sample 44
3.2.2 Data Collection Procedure 46
3.3 Research Instrument 46
3.4 Measures 49
3.5 Statistical Analyses 50
3.5.1 Descriptive Statistic 50
3.5.2 Reliability Analysis 51
3.5.3 Inferential Statistic 53
3.5.3.1 Pearson Correlation 53
3.5.3.2 Multiple Regression 55
3.6 Conclusion 56
CHAPTER 4: FINDINGS
4.0 Introduction 57
4.1 Frequency Distribution 57
4.2 Respondent Demographic 58
43 Descriptive Analysis 61
4.4 Normality Test of Actual Data 65
IX
4.5 Reliability Test 66
4.6 Intercorrelation among Study Variables 67
4.7 Hypotheses Testing via Multiple Regression Analysis 69
4.8 Smnmary of the Findings 74
4.9 Conclusion 75
CHAPTER 5: DISCUSSION, RECOMMENDATION AND
CONCLUSION
5.0 Introduction 76
5.1 The Backdrop 76
5.2 Discussion of the Findings 78
5.2.1 Idealized Influence and Organizational Commitment 78
5.2.2 Inspirational Motivation and Organizational 79
Commitment
5.2.3 Intellectual Stimulation and Organizational 81
Commitment
5.2.4 Individualized Consideration and Organizational 82
Commitment
5.2.5 Contingent Rewards and Organizational 84
Commitment
5.2.6 Management by Exception Active and 85
Organizational Commitment
x
5.2.7 Management by Exception Passive and Organizational 86
Commitment
5.3 Implications 87
5.3.1 Theoretical Perspective 87
5.3.2 Practical Perspective 88
5.4 Potential Limitations 89
5.5 Future Research 90
5.6 Conclusion 93
REFERENCES 94
APPENDIX A: SURVEY QUESTIONNAIRE 118
Xl
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LIST OF TABLES
Table Page
l.l Percentage Distribution of Employed Female by Industry 4
3.1 Development for each Variables 48
3.2 5-point Likert Scale 49
3.3 Reliability of the Pilot Test 52
3.4 Pearson Correlation Coefficient Values 55
4.1 Frequency Distribution of Survey Response 58
4.2 Respondents' Demographic 60
4.3 Mean and Standard Deviation Value for the Descriptive 61-64
Analysis
4.4 Normality Test of Actual Study 66
4.5 Reliability Statistic 67
4.6 Swnmary for Descriptive Statistic and Pearson 69
Correlation among Study Variable
4.7 Regression Results between Leadership Styles and 71
Organizational Commitment
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LIST OF FIGURE
1
Figure Page
2.1 Types of Organizational Commitment 21
2.2 Conceptual Framework of Effect of Leadership 38
Styles and Organizational Commitment among
Women in Manufacturing Industry
xiii
CHAPTER 1
INTRODUCTION
1.0 Background:
In this modem era where world has become a global village, competitive on the basic
competition of human resources seems to become more important in any finns as managing
people in organizations is the most difficult task in order to compete with the market.
According to Mosadeghrad (2003), human resource is the most valuable and very important
factor organizations need in order to run the organizations smoothly, effectively and
efficiently.
However, management of employees is largely dependent on the quality of leadership
organizations have (Albion & Gagliardi, 2007). Profit organization is mainly depending on
the effectiveness of leadership in order to achieve the organizational goals, targets and to
create employees commitment for their organizations (Sabir, Sohail & Muhammad Asif
Khan Iqra, 2011). The success of an organization depends on the hard working, loyal and
involved managers and employees so that employees are committed with the organizations.
Swanepoel, Eramus, VanWyk and Scheck (2000) emphasized that the successful
implementation of the business strategies is based on the ability of an organization to gain a
competitive advantage and maximize human capital, which rely on the leadership styles that
encourage employee commitment. Panayiotis, Pepper and Phillips (2011) mentioned the
increase of low trust, high stress and uncertainty will cause the job is insecurity if the
1
workforce is not committed which will direct negative influence on the perfonnance of the
organizations.
Ramchandran and Krishnan (2009) found that there is [eader and style of that leader is
one of the most vital detenninants of employee's commitment. Bass (1985) and Stogdill
(1963) stated the work related behavior such as employee's attitude, motivation and
perfonnance will be affected through leadership which influences the levels of organizational
commitment.
Nowadays, strongly competitive business environment, committed workforce has now
become issue of survival for every organization (Muhamad Usman Qaisar, Muhammad
Safdar Rehman & Muhamd Suffyan, 2012). Organizational commitment is critical because
workers who are committed will have less intention to leave the job, low absenteeism and
high motivation to perfonn the job at advanced level. Muthuveloo and Rose (2005) defined
organizational commitment as worker's level of participation with the job and organization
which can be attributed as employees' loyalty and faithfulness towards organization and
intention to be the part of that organization. Meyer and Allen (1990) had divided
organizational commitment into three basic components which are affective commitment,
normative commitment and continuance commitment.
Obiwuru, Okwu, Akpa and Nwankwere (2011) stated the leadership style in an
organization is one of the factors that play significant role in enhancing or retarding the
individual's interest and commitment towards the organization . Bass (1985) defined the
operational work to develop a model of transfonnational and transactional leadership in more
2
recent publications as the full range leadership model which categorized into four behaviors
or components of transfonnationalleadership consisted of charisma, inspirational motivation,
intellectual timulation and individual consideration.
Various past studies cover different aspects of leadership and its relationship with
organizational commitment. Swanepoel, Eramus, Van Wyk and Scheck (2000) described that
the combination of organizational commitment and leadership style is encouraged for the
successful implementation of business strategies to reach the organizational goals. Research
done by Lo, Ramayah and Hii (2009) on the leadership style and its relationship with
organizational commitment has concluded that transactional and transformational leadership
positively correlated with organizational commitment.
1.1 Malaysia Scenario:
Since year 1975 the Malaysian government has taken steps to recognize women's role
and their contributions towards the economic development of nation (Koshal, Gupta &
Rajindar Koshal, 1998). For the first time, a "Women in Development" chapter was included
in the Sixth Malaysia Plan (1991-1995) and Chapter 20 of Women in Development had
continually identified the women in development until the Ninth Malaysia Plan (2006-2010).
Thus, this shows that women in society have been taken seriously. The roles and recognition
ofwomen will never be forgetten by the Malaysia government as the government is trying to
increase the female participation in the labor force.
3
Malaysian women increasingly contribute to a significant proportion of labor force in
Manufacturing Sector. Apart from that, Malaysia's reliance on business in manufacturing
sector which contributed more than 40% in Growth Domestic Product (GDP) certainly
demands to be always highly committed and performed (Trade Chakra, 2009). The fo Uowing
table shows that the manufacturing industry is the highest largest employment of women in
comparison to other industry sector in Malaysia (Malaysia Department of Statistics, 20 10).
The participation of Malaysian women in manufacturing sector has showed clearly an
upward trend from 22.0% in 2005, to 22.2% in 2006, and 17.5% in year 2009. The
percentage is increased for the year of 2010 with the amount of 17.9%. Women in
manufacturing industry achieved the highest percentage among other category of industry.
(Malaysia Department of Statistics, 20 I 0).
Table 1.1: Percentage Distribution of Employed Female by Industry
Category of Industry
Year
2005 2006 2007 2008 2009 2010
Manufacturing 22.0% 22.2% 20.6% 20.05% 17.5% 17.9%
Wholesale and retail trade, I
repair of motor vehicles,
motorcycles and personal
and household goods
15.6% 15.6% 15 .6% 16.0% 16.6% 16.2%
Education 10.8% 10.7% 10.8% 11.3% 12.1% 12.7%
Constructions 2.0% 2.0% 1.8% 2.2% 2.0% 2.3%
(MalaYSia Department of StatistiCS, 20 10)
4
Pusat Khidmat Maklumat Akademik UNlVERSrn MALAYSIA SARAWAK
According to Deputy Minister in the Prime Minister's Department, Datuk S.K.
Devamany (Bernama, 2012), a majority of Malaysians had accepted and supported the
leadership of Prime Minister Datuk Seri Najib Tun Razak and the I Malaysia concept
openly, praising the Prime minister as the Father of I Malaysia and the Father of the
Country's Transformation. However, it is clear that through Najib's leadership which began
on April 3, 2009, the people had witnessed much changes and transformation.
The women leadership seems to play important roles in current society as the Women,
Family and community Development Ministry, Datuk Seri Shahrizat Abdul Jalil announced
(Bernama, 2012) the set-up of Women Leadership Chair at Universiti Kebangsaan Malaysia
(UKM) mainly to encourage conductions of researches on women leadership at both national
and international levels. The investment of the government's aspiration is to increase the
participation of women, as well as good leadership value to achieve the national agenda in
developing the quality of human capital.
A study done by Marmaya, Hitam, Torsiman and Balakrishnan (2011) entitled
"Employees perceptions of Malaysian managers' leadership styles and organizational
commitment" which focus on 20 female and 20 male in Malaysia. The results indicated both
female and male shows a significant correlation between leadership styles and organizational
commitment. The correlation supports the hypothesis that proposed a positive relation
between transformational and transactional leadership towards organizational commitment.
5
1.2 Problem Statements:
Most of the studies are conducted in Western countries such as Pakistan (Rehman,
Shareef, Mahmud & Ishaque, 2012; Bushra, Usman & Naveed, 2011), however there are
empirical studies done in eastern countries which are related to leadership style and
organization commitment. However, according to Raja and Palanichamy (2011), most of the
researches on transformational leadership are conducted in the U.S.A despite the increasing
support has been done from international studies as well. Therefore, there is a need to explore
more leadership style and organization commitment in Malaysia. However, these studies also
serve to confirm the results from the previous researches and compare the effect of
leadership style on organization commitment in different country.
Department of Statistic Malaysia (2011) reported the female's turnover is higher than
male which is 12.0% for the year 2010 if compare to male, 10.9%. Thus, the higher turnover
is one of the reasons which the women in Malaysia do not have commitments with the
organization. According to Ensher, Grant-Vallone and Donaldson (20 II), women are the
minorities who are facing the challenges in sustaining organizational commitment.
lackofsky (1984) stated the low commitment will lead to high rate of turnover.
However, organizational commitment is become more critical due to its link with tendency to
leave and turnover (Brown & Peterson, 1993), low level of morale (DeCottis & Summers,
1987) and decreased measures of altruism and compliance (Aamir & Sohail, 2006). It shows
that organizational commitment is plays important roles which will directly affect the
employees' performance.
6
Previous studies indicated that job stress and job satisfaction is significantly correlated
with continuous commitment and will influence the decision of employees to continue stay
or quit from a job (Bejamin Chan, Yeoh & Syuhaily Osman, 2010). It shows that the high
rate ofstress and low satisfaction will produce very low organizational commitment.
The issue of work-life balance is playing vital roles among the women in labour force.
A study done by Devi and Rani (2012) which focus on 711 women employees to examine
the impact of work-life balance on organizational commitment. The result indicated the
work-life balance is an important predictor of organizational commitment. According to
Grover and Crooker (1995), organization should provides work-life balance support so that
employees will feel that organization concerns about their life and feel that they enjoys
special privileges from organization which will cultivates the loyalty and commitment to
organization. Apart from that, work-family conflict which implies work-life imbalance was
found to be negatively related to organizational commitment due to the increasing
participation of women in the paid work, rising dual career families and diverse workforce
(Good. Page & Young, 1996).
1.3 Research Objective:
This study is conducted to identify the effect of female leadership style and
organization commitment among the women in Manufacturing Industry in Sibu areas. The
specific objectives are:
7
• to detennine the impact of idealized influence on organizational commitment such as
affective commitment, normative commitment and continuous commitment among women
in Manufacturing Industry.
• to detennine the impact of inspirational motivation on organizational commitment
such as affective commitment, normative commitment and continuous commitment among
women in Manufacturing Industry.
• to examine the impact of intellectual stimulation on organizational commitment such
u affective commitment, normative commitment and continuous commitment among
women in Manufacturing Industry.
• to fmd out the impact of individualized consideration on organizational commitment
such as affective commitment, normative commitment and continuous commitment among
women in Manufacturing Industry.
• to investigate the impact of contingent reward on organizational commitment such as
affective commitment, nonnative commitment and continuous commitment among women
in Manufacturing lndustry.
to examine the impact of management by exception active on organizational
oommitment such as affective commitment, normative commitment and continuous
commitment among women in Manufacturing Industry.
• to find out the impact of management by' exception paSSive on organizational
commitment such as affective commitment, normative commitment and continuous
commitment.
8
1.4 Research Questions:
l. Will idealized influence affect on the organizational commitment among women in
Manufacturing Industry?
2. Will inspirational motivation influence on the organizational commitment among
women in Manufacturing Industry?
3. Will intellectual stimulation influence on the organizational commitment among
women in Manufacturing Industry?
4. Will individualized consideration influence on the organizational commitment among
women in Manufacturing Industry?
5. Will contingent rewards influence on the organizational commitment among women in
Manufacturing Industry?
6. Will management by exception active influence on the organizational commitment
among women .in Manufacturing Industry?
7. Will management by exception passive influence on the organizational commitment
among women .in Manufacturing Industry?
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1.5
1.5.1
Definitions of Key Terms:
Leadership
According to Dejong and Hartog (2007), described leadership as a process to influence
people in order to get desired results that expected from a certain people.
1.5.2 Transformational Leadership
Bmos (1978) defined it as a process where leader's effect or influence on one or more
followers so that each followers will raise the motivation to each others in order to exceed
the expectation and achieve high level of morality.
1.5.2.1 Idealized Influence
Mannaya et ai. (2011) defined as the role model who the leaders need behave on to directly
influence the subordinate or followers so that they become admired, respected and trusted .
.5.2.2 Inspirational Motivation
According to Gao and Bai (2011), inspirational motivation occurs when leaders encourage
and stimulate those around them by providing challenges with high standards and meaning to
their work for the future goals.
1.3 Intellectual Stimulation
According to Marrnaya et al. (2011), intellectual stimulating refers to the awareness of the
problems, thoughts and imaginations by subordinate which recognizes their own beliefs and
es.
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