Transformational Leadership and Employee Performance in Sacco’s in Nyeri County

Abstract

With increasing competition among today's' organizations, stakeholders tend to be more concerned about probing the new ways of getting the employees more committed to what they do and to the organization as well. The role of leadership is an important determinant of employee’s performance and commitment. The purpose of this study was to investigate the effect of transformational leadership on employee performance in Sacco’s in Nyeri County. The specific objectives of the study were to establish the relationship between Intellectual stimulation and employee performance in Sacco’s in Nyeri county. A total of 12 Sacco’s in Nyeri County were randomly selected and surveyed as the population of the study comprising of 164 respondents. Stratified Random sampling technique was used to draw the sample of 66 respondents. A questionnaire and an interview guide were used for data collection with closed ended questions designed for the employees and an open ended interview guide for managers. A descriptive survey design was used. Data was analyzed using SPSS and multiple regression analysis. Results showed that transformational leadership in Sacco’s led to improved employee performance. When managers utilized intellectual stimulation, there were positive reactions from employees. With the role of leadership in the modeling of employee commitment and performance considered very crucial in the modern organization, it was paramount for Sacco’s to put more effort in entrenching transformational leadership in their organizations.