Abstract
Leadership is among the top researched topics in academic literature and one increasingly accepted perception is that leaders are not born but made, and in order to be an effective leader that person needs to have the knowledge, patience, experience and skills to negotiate, work with others but most importantly to lead (Amanchukwu et al., 2015). Performance which is a multi-dimensional concept is one critical aspect of leadership of organisations today and therefore firms need to apply great leadership so that performance is positive (Shahin, Naftchali& Pool, 2014). Therefore, this literature review will be exploring the concept of leadership, its theories and styles and the impact it has on performance in firms, all with reference with academic journals.
Literature Review
Leadership
Leadership is central to define the role of performance in an organization. The role of leadership is integral to influence the behavior of employees. Carter, S. M., & Greer, C. R. (2013) defined the scope of leadership as it facilitates individuals to show collective efforts, in order to achieve the goals. The leadership process is key to consider the aim of an organization that may lead to bringing a change. According to Cheng, C., Cao, L., Zhong, H., He, Y., & Qian, J. (2019) the strategic leadership works for effective policymaking in an organization and it provides a positive linkage between performance and goals’ achievement. Leadership styles offer critical plans and directions that motivate people.
Leadership styles
Wart, M. V., &Suino, P. (2017) examined the scope of leadership in the form of its style is diverse. The author provided clarity of leadership style, as it is an approach that implements directions and motivates individuals. Leadership provides direction to followers by offering them specific positions to accomplish tasks and obligations. The leadership functions establish essential requirements to organize operations under different styles of leadership. Harris, A., Jones, M., & Baba, S. (2013) illustrated that transactional leadership shows interrelation in group leader and group members. It orients managerial leadership because it offers ways to manage the structure of the organization. Rittenhofer, I. (2019) discussed this style of leadership face three factors. The first is contingency based on specific requirements of tasks and roles. The second is active management to avoid mistakes but supervise performance. The third form is passive management. The style of leadership tends to intervene in the common mistakes happened in the business environment. The author realized that the business roles in the transactional style of leadership help leaders set expectations.
Essa, E. B., &Alattari, A. (2019) focused on transformational leadership which is a loyalty process to target missions. The style that changes the attitude of employees at work is a key element to orient employees towards innovation. The innovative performance is significant to consider in terms of an increase in efficiency and productivity. The transformative style of leadership emphasizes on the value judgment and some values. Magiera, A., &Religa, J. (2015) provided that the style also offers groups and individuals to be goal-oriented. The author further focused on different other styles such as the autocratic and democratic style of leadership. The autocratic is also an authoritative style that allows leaders to direct their followers to do positive. The democratic style of leadership undertakes more employees into action to get involved in the decision-making process as it leaves them to follow the authority of the leader.
Alloubani, A., &Akhu-Zaheya, L. (2018) described the leadership styles and theories and how they work to increase the performance of an organization. Under the employee’s perspective, the authoritative leadership designs their future, in terms of directing them to get goals. The leaders through these styles of leadership work effectively because they dominate the organization and demand innovation. Due to styles of leadership, creativity, passion, and commitment come at the front. Bush, P. M. (2013) described the techniques that determine appropriate leadership for an organization. It is based on the creativity and complexity of an organization that determines the scope of capacity building for followers. The autocratic leaders are also known as authoritative because they offer clear directions so deadlines are met effectively. According to Maniscalco, C. (2019), in an organization, leadership styles give rise to innovation and enhancement inefficiency. The difficulty that leaders face transforming the attitude of their followers is due to previously built values.
Kraljevic, Z. (2018) proposed a style of leadership in the innovatory platform is delegating. This category is central to allow followers to take part in essential decision-making activities. The leaders also provide critical tools to allocate resources that may resolve issues (Moss, G. 2019). The delegating style of leadership is also effective for followers in a situation when they feel depressed and anxious. This style of leadership is central to offer motivation, skills, and capacity. Banerjee, B., Ceri, S., &Leonardi, C. (2016) discussed innovation and its relationship with leadership in the context of different styles that improve the overall efficiency.
Anwar, R., &Qisthi, Y. (2017) analyzed that leader is a key to bring innovation in an organization because it holds innovative skills and expertise to make strong decisions as well as judgment. The situation of outcomes is based on an internal and external conducive environment for employees that not only supports creativity but also brings innovation. Goksoy, S. (2016) provided that an innovative leader is focused and determined to bring change and make attitudes of employees professional.
Importance of Leadership
The influence of leadership on organizational performance is viewed in terms of leadership management. This brings creativity into account and directs employees to attain innovative activities. Ebrahimi, P., Moosavi, S. M., &Chirani, E. (2016) directed a concept of leadership with that of creativity and process management. The author discussed that the scope of management is linked to performance and improvement. Leadership engages in the management-oriented landscape to motivate employees about positive efficiency. In an organizational context, leadership is viewed as a transformative element that recognizes improvement. Through environmental conditions and novelty of work, the leader and followers determine their engagement (Kibbe, M. R. 2019).
Norese, M. F. (2016) examined the leadership concept as an ability to improve and inspire the follower. The leadership provides a key position to fulfill the obligatory tasks. According to Esra, Alamayreh, M., Sweis, R. &Obeidat, Y. (2019), the split leadership functions provide structural support to the organization. The rapidly changing environment defines the need for organizational performance due to leader. An innovative leader helps generate a high reputation of the organization and motivates employees to work diligently. The innovative performance is influenced due to professional leadership attitude (Visser, W. (2017). Akkaya, B. (2018) discussed the scope of innovation as the development of new products that design sophisticated processes and structures to create the value of the organization.
Niknamian, S. (2019) focused on the contribution of a leader in a versatile environment that can change the future of the organization. The effective role of a leader promotes in bringing productivity for the workplace and designs a successful climate. The innovation is strongly related to performance and the innovative leader tends to create a productive environment due to moderation effects. Matejun, M. (2017) illustrated that leadership plays a crucial role in the empowerment of individuals and organizations pursue this success by following the leader’s policy management (Dopfer, M. 2018). The leadership styles vary from one organization to another, yet they focus on positive outcomes and transform the employee’s attitudes to get success. Besides, leaders also influence prevailed climate, so it tends to develop strong leadership by exchanging information (Brooker, P., & Hayward, M. 2018).
Organization’s Performance
The performance of organization is related to innovative aspects of strategy. Some factors contribute to defining individual personalities in effective strategic managers by their subordinates(Amanchukwu et al., 2015). Different studies have reported that coworker assessment resulted in effective and strategic managers. The elements that bring organizational effectiveness are consistency, strategic thinking, and competitive attitude. Shah, S. M. M., Mirani, M. A., Memon, P. A., & Bhutto, N. A. (2016) discussed strategic leadership as an effort that significantly contributes to managerial effectiveness.
The strategic leadership supports organizational leadership, in terms of bringing improvement and modifying its structure. Carnall, C., & Roebuck, C. (2015) highlighted the forms of leadership that inspire and support others with the achievement of the vision. Strategic leadership engages organizational abilities and individuals’ characteristics into a signified model. Hadley, S. (2018) focused that strategic leaders set directions by no managing current direction for the organization but also translate the moral values. They translate strategy in action and determine intervention points for an organization that can improve performance (Sethibe, T. and Steyn, R. 2015). Moreover, they also develop strategic capabilities. Clarke, S. (2012) mentioned that the strategy refers to a broad activity that translates into short term planning of operations, which undertakes the values system.
Importace of Organization’s Performance in Firms
The performance of organization is related to the strategic leadership. The conceptual skills that modify the attitude of followers are based on the vision and mission of the leader. The strategic directions align employees’ attitudes toward learning. It generates a learning-centered relationship. The strategy-making process led by a leader is based on strategic thinking. Harlianto, J. R., &Afandy, D. (2018) focused on different perspectives of strategy that undertake positive skills, organizational commitment, and political will.
Kapal, M. (2015) articulated strategy of leadership into three actions, build, create and define. The concept of the build is related to images and experiences. To create is to set dialogue and conversations that are due to mental cognitive understanding. The element define is about the strategic perspective that provides a formal plan. Matejun, M. (2017) illustrated that innovative potential can be developed by defining desired outcomes as it helps to clear a strategic architecture for the organization. Thakur, R., Angriawan, A., &Summey, J. H. (2016) discussed technical opinion leadership that brings personal characteristics. The structural significance of innovative leadership formulates the way to bring improvement in performance and creativity (Shahin, A., Naftchali, J.S. and Pool, J.K., 2014).
Yıldız, S., Baştürk, F., &Boz, I. T. (2014) presented the effect of leadership in the performance of the business. The innovative aspect is central to foresee the latest development and technological improvement. Because of strategic decision making, the participation of the leader and their knowledge holds a central position. It tends to portray the strategic reforms required for long term decision making. The strategic motivation leads to the improvement in commitment (Slimane, M. 2015). The author discussed trust-building capabilities that formulate the psychological contract. The motivational staff under strategic policymaking builds value for commitment and develops long term ambition that in turn improves the participation of teams. Kock, A., Gemünden, H. G., Salomo, S., & Schultz, C. (2013) explored the innovative scope of improvement when applied in any organization. It is valued that technological innovation is possible due to strategic leadership that results in the commercial success of an organization.
Leadership and Performance
The innovation is to bring new ideas and generate positivity with the help of skills and beliefs. The business performance and leadership are interrelated since they alter employees’ performance and engage them into productive ventures (Liu, S., Hu, J., Li, Y., Wang, Z., & Lin, X. 2014). The study about innovation and leadership by Walumbwa, F. O., &Wernsing, T. (2012) claimed that styles of leadership shed positive influence to bring innovation in all the work forums, for instance, it can be eCommerce, modern technology, and commercial product development. The transformative leadership, business performance, innovation, and commitment are key variables that meaningfully yield functionality. The leadership and innovation closely work on the notion of expertise, skills and acquired vision. A leader in this form tends to stay focused and provides a positive yet meaningful effect on business performance. Johannessen, J.-A., &Stokvik, H. (2018) Western, S. (2018) illustrated the aspects of innovative leadership and its impact on performance.
Komariah, A., Mawardi, M., &Abubakar, A. (2017) declared that opportunity is necessary to reshape the style of thinking and in the form of innovative leadership, it occurs. Leadership skills are a way to develop an innovative style that enhances efficiency. Perkins, K. M. (2019) claimed that innovative ideas at the workplace are significant to formulate positive attitudes. It welcomes all the necessary changes in the organization and offers additional solutions. Being adept at assaulted assumption is specific and Hinić, D., Grubor, J., &Brulić, L. (2016) put forward that innovation is a key in leadership aspects.
Conclusion
Scott, P. (2017) mentioned that focusing the latest and important trends are integral to bring development and spread information for employees. Innovative leaders think proactively, so they foster on brilliant suggestions regarding innovation in performance. Rao, M. (2017) provided that creativity is apparent from preparation, discipline, and routine made by leaders. Rosenberg, D. A., & Laver, H. S. (2017) clarified that innovative characteristics are integral to make up the future viability. These ways are related to innovative systems to tackle unpredictable circumstances.
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