Transformational Leadership On Organizational Citizenship Behavior And Its Mediational Pathway

Abstract

Organizational citizenship behavior (OCB) is an extra-role behavior that is known to increase an organization’s success and effectiveness, while transformational leadership has been found to increase employees’ OCB. However, factors and processes on how transformational leadership may increase employees’ OCB are seldom discussed in the literature. Few researchers pointed out this mixed evidence on the underlying mediators within the relationship between transformational leadership and OCB. Hence, the purpose of this research is to understand the effect of transformational leadership on employees’ OCB by investigating trust in leader, self-efficacy, and affective commitment as mediators between the two. Two hundred and five full-time working adults (Male = 74, Female = 131; Mage = 29.01) in Malaysia participated in the study. Using regression and mediation analyses, results showed that there is a significant relationship between transformational leadership and employees’ OCB. Findings also indicate that trust in leader and self-efficacy mediated the relationship between transformational leadership and affective commitment. Affective commitment also mediates trust in leader and self-efficacy and OCB. This implies that transformational leadership is effective in nurturing employees’ OCB in Malaysia. This study may further expand to include other leadership styles that are motivating, such as empowering leadership on its mediational pathway in motivating employees.

Keywords: Transformational leadershiptrust in leaderaffective commitmentself-efficacyorganizational citizenship behavior

Introduction

Organizational citizenship behavior (OCB) is referred to as “an optional extra-role behavior, improving the organizational environment that supports task performance” (Organ, 1997, p. 95). OCB is widely known in maximizing efficiency and encouraging the smooth and effective functioning of the organization, which serves as an important element for organizational survival (Murphy et al., 2002). Leadership styles have been widely shown as predictors of OCB (Schlechter & Engelbrecht, 2006), and among the leadership styles, transformational leadership has constantly been shown to associate with OCB in a few studies (Carter et al., 2014).

Transformational leadership and organizational citizenship behavior

Leadership has been widely studied as an essential determinant of organizational effectiveness and efficiency. It is well known to play a critical role to influence change in organizations for effective management. Leaders are able to transform organizations through their vision for the future and by clarifying their vision (Lawler, 2008). Particularly, transformational leadership is emphasized to be associated with employees’ performance (Kirkman et al., 2009).

Based on the social exchange theory, employees are motivated to work beyond simple rewards when leaders practice transformational leadership as an exchange for their efforts or performance (MacKenzie et al., 2001) and are able to emphasize the growth and development of organizational goals (Bass, 1985). Employees are said to form social exchange relationship with their leaders (Blau, 1964), resulting in higher job satisfaction and OCB (Liao & Chuang, 2007), and employees will demonstrate extra-role behaviors as in-role when they feel that they are treated equally in their workplace (Bachrach & Jex, 2000).

Another possible explanation for the relationship is due to a leader’s status as a role model (Koh et al., 1995). Given that transformational leaders tend to be imitated by the employees as they are seen as a role model to them when transformational leader engages in extra-role behaviors, employees will take it as a model and engage themselves in extra-role behaviors. Hence, Hypothesis 1 states that transformational leadership would lead to higher OCB.

Transformational leadership on trust in leader and self-efficacy

Trust in leader is defined as ‘one’s belief and confidence in the potentials and capabilities of the management, it is an essential element for the success and permanency of an organization (Ferres et al., 2004). Several studies have established that trust is primarily developed via transformational leadership (Podsakoff et al., 1990). It is proposed that transformational leaders allow employees to get involved in decision-making, thus, employees perceived it as their leader having respect for them, which leads to positive social exchange relationships (Avolio & Bass, 1995) that strengthen both parties’ emotional bond and inspires higher level of trust. Transformational leadership builds interactive relationships with employees to bring out positive outcomes from them (Dirks & Ferrin, 2002), especially when transformational leaders engage in model acts, which are interpreted as requiring risk and self-sacrifice. Besides, followers are more likely to trust their leader when transformational leaders show concern for employees’ needs and unselfishly encourage their position (Conger et al., 2000).

Self-efficacy is defined as one’s belief in one’s capability to perform a specific task (Bandura, 1977). Due to its effective behavioral strategies, high self-efficacy is believed to contribute towards improving organizational performance (Gist & Mitchell, 1992). Self-efficacy is able to be improved by leadership behavior, which then indirectly can improve organizational performance (Eden, 1992). Leader-employee relationships can be explained by mutual trust, verbal communication, openness, and bi-directional feedback between both parties (House & Shamir, 1993). Through indirect experiences and social persuasion, these relationships will lead to the development of employee’s self-efficacy (Walumbwa et al., 2008). Hence, it is expected that employee’s self-efficacy will increase from transformational leaders who act as a model by learning from their leaders’ experiences. Gist and Mitchell (1992) found that self-efficacy can be encouraged by enactive mastery, vicarious experience and verbal persuasion. And it corresponds with transformational leadership’s significant characteristics, performed role modeling and verbal persuasion physiological arousal (Yukl, 1990). Consequently, hypothesis 2 states that transformational leadership would lead to higher (a) trust in leader and (b) self-efficacy.

Trust in leader and self-efficacy on affective commitment

Affective commitment is defined as ‘the employee’s emotional attachment to, involvement in and identification with the organization (Meyer & Allen, 1991) and is found to be closely related to leadership. Employees with strong affective commitment remain employed in the organization because they want to do so (Meyer & Allen, 1991). When trust in leader is established, the social relationship leaves an impact on employees in which employees feel a stronger commitment to the leader (Yang & Mossholder, 2010) and the workplace (Dirks & Ferrin, 2002). This signifies a reciprocal relationship that is effective and beneficial for both the leader and the employee (Cropanzano & Mitchell, 2005). Hence, employees will reciprocate the leader’s kind deeds by being more willingly committed to the job and organization (Liden et al., 2000).

Self-efficacy is an essential element for an employee to be more committed at work (Litt, 1988), as employees find purpose at the workplace that allows them to feel empowered and able to contribute at the workplace. When employees postulate high self-efficacy, they will also show high satisfaction at work, which further affects them to be more committed at work (Shahidi et al., 2015). Hence, hypothesis 3 states that (a) Trust in leader and (b) self-efficacy will lead to higher affective commitment.

Affective commitment and organizational citizenship behavior

Based on the social exchange framework, an emotionally focused leader may exhibit the reciprocal behavior of OCB, which in a high-quality social exchange relationship showing a higher level of employee commitment. Employees are more prone to engage in OCB because they feel a relational obligation to produce positive outcomes that benefit their relational partners (Cropanzano & Mitchell, 2005). Affective commitment is also found to be associated with a wide range of behavioral variables, for instance, sharing information, working for extra-hours, and helping others (Solinger et al., 2008), which can be perceived as OCB. Organ and Ryan (1995) reported that affective commitment has a significant positive relationship with altruism and generalized compliance.

This result had also been reflected in non-western settings, such as the study done by Chen and Francesco (2003) in China and another study done by Kuehn and Al-Busaidi (2002) in Oman, which show a positive relationship between affective commitment and OCB. Thus, we contribute to the research that similar relationships will be found in the Malaysian setting. In summary, it is assumed that when employees have attachment and like the organization, it is manifested by their affective commitment. All of these factors will lead them to engage in extra-role behaviors, hence, hypothesis 4 states that affective commitment would lead to higher organizational citizenship behavior.

Trust in leader, self-efficacy, and affective commitment as mediators between transformational leadership and organizational citizenship behavior

In summary, when employees have trust in their leader, they will put more effort in completing their task and engage in behaviors that are helpful for the organization to achieve its ultimate goals although it is not within their job role (Burke et al., 2007). For instance, in a trusting relationship, the employee will reciprocate their leader’s behavior in the form of job performance and OCB (Organ et al., 2005). Dirks and Ferrin (2002) used the social exchange theory to explain how transformational leader influences employees’ performance outcome. The study indicated that employees would feel more competent in completing tasks assigned to them (Walumbwa & Hartnell, 2011), and put more effort in achieving organizational goals and objectives when their leader treats them well. Hence, taken all that together, it is proposed that hypothesis 5: (a) Trust in leader and (b) self-efficacy would mediate transformational leadership and affective commitment and hypothesis 6: Affective commitment would mediate (a) trust in leader and (b) trust in self-efficacy, and organizational citizenship behavior.

Problem Statement

Factors and processes by which transformational leadership may increase employees’ OCB are seldom discussed. A study by Nohe and Hertel (2017) stated that transformational leadership increases employees’ OCB, yet it does not provide insights on how transformational leadership may increase employees’ OCB. Previous studies had warranted transformational leadership’s association with various positive outcomes and employees’ behaviors are influenced by their perception of leadership styles (Yammarino et al., 2005). However, the link between transformational leadership and OCB is somewhat mixed in the previous literature, showing either positive (Leithwood & Jantzi, 2000) or no relationship (Kim, 2014).

Research Questions

Using the social exchange theory (Cropanzano & Mitchell, 2005), the current study explains the emergence of OCB from transformational leadership and investigate how transformational leadership and OCB are related. Social exchange relationships are characterized by loyalty, trust, and mutual commitment developed when people follow the norm of reciprocity (Blau, 1964). Following this, employees involved in social exchange relationships with transformational leaders have positive outcomes (e.g., OCB) to reciprocate their leader’s favorable behaviors.

Purpose of the Study

The current study intends to understand the relationship between transformational leadership and OCB in more depth by investigating social (i.e., trust in leader) and intra-individual (i.e., self-efficacy) factors as mediators between them. We also propose that the two factors will also lead to higher affective commitment, which will then increase employees’ OCB. The current study contributes to the literature on how transformational leadership increases employees’ OCB. It further attests the applicability of transformational leadership within Asian setting in which people are more collectivistic (Dorfman et al., 1997). The proposed model is illustrated in Figure 01 .

Figure 1: Research model
Research model
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Research Methods

Participants

A total of 205 full time working Malaysian employees (Mage = 29 years; SD = 8.8) were included in the study. Participants were majority female (N = 131; 64%) with an ethnic distribution of 63% Chinese, followed by 19% Indians, and 13% Malays. All participants had at least three months of working experience, and most participants (71%) earn at least RM5000 a month. Participants were recruited using convenient sampling through various social media platforms, such as LinkedIn and Facebook. Participants were asked to complete and then submit the survey. All information is kept private and confidential and no identifiable information was requested.

Instruments

Transformational leadership was measured using the Global Transformational Leadership Scale (GTLS) developed by Carless et al. (2000), which consists of seven items. Each item was rated by a 5-point Likert scale from 1 ‘never/rarely’ to 5 ‘always’. An example of the items is ‘My leader treats staff as individuals, supports and encourages their development’. In the current study, the Cronbach alpha coefficient was .94.

Trust in leader was measured using the Trust in Leader Scale (TLS) developed by Kanawattanachai and Yoo (2002). Each item was rated on a 5-point Likert scale from 1 ‘strongly disagree’ to 5 ‘strongly agree’. An example of the items is ‘My leader can be relied upon to do as he/she says will do’. In the current study, the Cronbach alpha coefficient was .94.

Self-efficacy was measured with the New General Self-Efficacy Scale (NGSES) by Chen et al. (2001), which consists of eight items. Each item was rated on a 5-point Likert scale from 1 ‘strongly disagree’ to 5 ‘strongly agree’. An example of the items is ‘In general, I think I can obtain outcomes that are important to me’. In the current study, the Cronbach’s alpha coefficient was .89.

The affective commitment was measured using the affective commitment scale developed by Meyer et al. (1993). The scale consists of six items; each item was rated on a 5-point Likert scale from 1 ‘strongly disagree’ to 5 ‘strongly agree’. In the current study, the Cronbach’s alpha coefficient was .89.

Organizational citizenship behavior (OCB) was measured using the scale developed by Lee and Allen (2002). The scale consists of 16 items and each item was rated by a 7-point Likert scale from 1 ‘never’ to 7 ‘always’. In the current study, the Cronbach’s alpha coefficient was .93.

Findings

As shown in Figure 2 , Hypothesis 1 predicted that transformational leadership would lead to higher OCB. Result shows that transformational leadership significantly lead to OCB, F (1, 203) = 71.09, p < .001, R2 = .259. Thus, as transformational leadership increased by 1 SD, OCB increased by .51 SD, t = 8.43, p < .001. Hence, Hypothesis 1 was supported.

Hypothesis 2 predicted that transformational leadership would lead to higher (a) trust in leaders and (b) self-efficacy. The results showed that transformational leadership significantly lead to increased trust in leader, explaining 66% of the variance, F (1, 203) = 395.16, p < .001, R2 = .661, thus, as transformational leadership increased by 1 S.D., trust in leader increased by .81 S.D., t = 19.88, p < .001. Results also showed that transformational leadership significantly lead to self-efficacy, explaining 7% of the variance, F (1, 203) = 15.43, p < .001, R2 = .071. As transformational leadership increased by 1 S.D., self-efficacy increased by .27 SD, t = 3.93, p < .001. Hence, Hypothesis 2 was supported.

Hypothesis 3 predicted that (a) trust in leader and (b) self-efficacy would lead to higher affective commitment. The results showed that trust in leader significantly led to affective commitment, explaining 33% of the variance, F (1, 203) = 100.83, p <.001, R2 = .332. Analysis of the coefficients show that as trust in leader increased by 1 S.D., affective commitment increased by .58 S.D., t = 10.04, p < .001. Results also showed that self-efficacy led to affective commitment, explaining 9% of the variance, F (1, 203) = 20.47, p < .001, R2 = .09, where affective commitment increased by 1 S.D., OCB increased by .30 S.D., t = 4.53, p < .001. Hence, Hypothesis 3 was supported.

Hypothesis 4 proposed that affective commitment would lead to higher organizational citizenship behavior. The results also showed that affective commitment led to higher organizational citizenship, explaining 35% of the variance, F (1, 203) = 110.90, p < .001, R2 = .353, where affective commitment increased by 1 S.D., OCB increased by .59 S.D., t = 10.53, i < .001. Hence, Hypothesis 4 was accepted.

Hypothesis 5 proposed that (a) trust in leader and (b) self-efficacy would mediate transformational leadership and affective commitment. Using the Monte Carlo test, transformational leadership was found to have a significant effect on affective commitment through, trust in leader (95% confidence interval [CI], lower level [LL] = .3293, upper level [UL] = .4994) and self-efficacy (95% confidence interval [CI], lower level [LL] = .0261, upper level [UL] = .1272).

Hypothesis 6 proposed that affective commitment would mediate (a) trust in leader and (b) trust in self-efficacy, and organizational citizenship behavior. Using the Monte Carlo test, trust in leader (95% confidence interval [CI], lower level [LL] = .4873, upper level [UL] = .8251) and self-efficacy (95% confidence interval [CI], lower level [LL] = .3109, upper level [UL] = .8905) were found to have a significant effect on organizational citizenship behavior through affective commitment.

Figure 2: The final model
The final model
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The overall study looks at social and intra-individual factors that facilitate organizational citizenship behavior. Specifically, the study examines the effect of transformational leadership on OCB through trust in leader, self-efficacy, and affective commitment.

Theoretical contributions

Findings from the study are similar to results of past researches. Firstly, transformational leadership leads to higher OCB (Carter et al., 2014). This supports that transformational leaders are able to motivate employees to internalize and strive to achieve the organizational goals and objectives that make them feel recognized and have a sense of belonging which then leads to increase in OCB (Shamir et al., 1993). It also showed that when transformational leaders give support and encouragement to their employees, it will encourage them to perform above the status quo to meet organizational goals.

The study also found that transformational leadership is a strong predictor of trust in leader and self-efficacy, subsequently influence the increase of affective commitment and OCB. From a trust perspective, transformational leadership is able to increase employees’ trust in leader when their leader respects them (Avolio & Bass, 1995), shows concern for their needs, and unselfishly encourages their position (Conger et al., 2000). Employees’ self-efficacy is increased by transformational leadership through verbal persuasion and role modelling. Furthermore, employees with high self-efficacy believe in their own competencies to fulfil tasks successfully, which further increase their intention of extra-role behaviors.

Malaysians, within the Asian context, are slower in trusting others as trust is something personal and requires more work to be earned as compared to their Western counterparts (Gallo, 2011). Unless there is a strong level of trust, Asian employees will be unsure of the leader’s behavior and motives (Littrell, 2002). Hence, it can be suggested from the findings that transformational leadership is effective in increasing the trust level in employees. Frequent contact and communication in a conducive leadership style benefit employee from two aspects: the social aspect (Yang & Mossholder, 2010) and the intra-individual aspect (Bass, 1985; Dirks & Ferrin, 2002; McAllister, 1995). Hence, employees’ OCB will be affected by transformational leadership when a leader leads, guides, and motivates them to perform the task well.

The findings also showed that trust in leader and self-efficacy mediates the relationship between transformational leadership and affective commitment, affective commitment mediates the relationship between trust in leader, self-efficacy, and OCB. The findings also indicated that when transformational leaders show concerns for employee’s needs and act as a role model to the employee, it will increase employees’ trust in leader (Conger et al., 2000) and self-efficacy (Gist & Mitchell, 1992), which, in turn, increase employees’ stronger commitment to the organization when they have higher satisfaction at work (Shahidi et al., 2015). Consequently, it will lead to them putting more effort in completing tasks that are beneficial to the organization, although it is not within their job function (Burke et al., 2007). This study provides to our knowledge by showing employee’s trust in leader, self-efficacy and affective commitment as a crucial psychological mechanism in the process of transformational leadership.

Overall, our findings of transformational leadership are consistent with past literature findings, which state that transformational leadership instills trust in leader (Podsakoff et al., 1990), and self-efficacy (Mok & Au-Yeung, 2002), which then lead to higher affective commitment as a sign of returning the kindness extended by the leader (Kim et al., 2012; Meyer & Allen, 1991). Our findings also supported the social exchange theory, where the significance of dependence in social exchange for both parties is emphasized. Specifically, this relationship causes the employee to perform beyond the status quo to reciprocate their behaviors.

Practical implications

The findings yield some implication for human resources management, especially on leader development and training. Firstly, organizations can expect higher OCB by employees when leaders in the organization demonstrate transformational leadership. Hence, for organizations that would like to increase OCB in the organization, more training sessions on leadership training for a leader can be held to cultivate a higher level of transformational leadership. More importantly, in transformational leadership training, organizations can focus on the relationship quality between the leader and the employees, or the ways transformational leaders can improve employees’ self-efficacy. Organizations can provide transformational leadership training when new leaders first join the organization so that such a process can be facilitated since the beginning.

Strength and limitations

The current study gives an insight on how transformational leadership can influence employees’ OCB (trust in leader, affective commitment and self-efficacy) as a predictor of OCB. This finding has extended current literature showing the importance of transformational leadership in social relationship and employees’ intra-individual characteristics.

The relationship between transformational leadership and OCB had widely been studied in the Western setting but is scarce in the Asian context, less so in Malaysia (cf. Lee et al., 2018). Hence, the applicability of transformational leadership within the Asian setting is inconclusive. Malaysia, a multicultural country that performs high collectivism, is significantly different from the Western setting. The current study extends findings from the Western context to the multicultural societies in Malaysia, specifically on the association between transformational leadership, OCB, employees’ trust in leader, affective commitment and self-efficacy, giving support to a significant transfer of transformational leadership within the Malaysia multicultural context.

Future Direction

Future study can use a longitudinal study design to examine the effect of employees’ trust in leader (Zapf et al., 1996). Malaysia, within the Asian culture, which is high in collectivist culture (Dorfman et al., 1997), trust takes a long time and is harder to develop compared to the Western culture (Gallo, 2011). A collectivist mentality tends to treat outsiders as those who take advantage, and so, are more inclined to trust someone whom they have close relations with (Littrell, 2002). This is also beneficial for the study in terms of ascertaining the cause and effect relationship between the variables (Lee et al., 2017). Furthermore, OCB is extremely subjective and individual. In the current study, the sample was being collected by the employee’s rating, where the voluntary act of participating in the survey has already reflected an act of OCB (Becker & Randall, 1994). Hence, the current study might be capturing more employees with a higher level of OCB. If multiple approaches of study such as interview and objective data are used, the findings may be more comprehensive.

Conclusion

The purpose of this research is to understand the effect of transformational leadership on employees’ OCB, and investigate how trust in leader, self-efficacy, and affective commitment may serve as mediators between the two. Results showed that there is a significant relationship between transformational leadership and OCB, trust in leader and self-efficacy mediate transformational leadership and affective commitment, and affective commitment mediates trust in leader and self-efficacy, and OCB. This outcome implies that transformational leadership is an effective leadership style in nurturing employees’ confidence and in turn, enhancing employees’ OCB.

References

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Publication Date

06 October 2020

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978-1-80296-087-7

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European Publisher

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88

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Finance, business, innovation, entrepreneurship, sustainability, environment, green business, environmental issues

Cite this article as:

Tan, C. L., & Lee, M. C. C. (2020). Transformational Leadership On Organizational Citizenship Behavior And Its Mediational Pathway. In & Z. Ahmad (Ed.), Progressing Beyond and Better: Leading Businesses for a Sustainable Future, vol 88. European Proceedings of Social and Behavioural Sciences (pp. 739-750). European Publisher. https://doi.org/10.15405/epsbs.2020.10.67