Aisha Zuber Final Research

ASSESSMENT ON THE ROLE OF LEADERSHIP STYLE ON
EMPLOYEE PERFORMANCE IN ETHIO-TELECOM: IN

THE CASE OF DIRE DAWA BRANCH
A Research Submitted to the Department of Management in

Partial Fulfillment of the Requirement for the Bachelor Degree
(BA) in Management
By: Aisha Zuber
ID NO: 1104195
Dire Dawa University

College of Business and Economics
Department of Management
Advisor: Behaylu Wondifraw
October, 2021
Dire Dawa, Ethiopia
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ACKNOWLEDGEMENT
I would like to express my sincere appreciation to my Advisor Ms. Behaylu
Wondifraw for his guidance, assistance, and suggestions on this study. To those
who had contributed assistance and advice in this study, either directly or
indirectly, yet their names are not cited here, they deserve my greatest
gratitude. Thanks to all. Last but not least, I would like to thank my family
members, who had given a lot of encouragement and motivation to complete
this study.
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ABSTRACT
The study was intended to assess the role of leadership style on the employee performance
of Ethio-Telecom in Dire Dawa Branch. Descriptive research design was used to conduct
this study. Both qualitative and quantitative research approach was used. In this study, the
data were collected by using different data collection methods; the researcher was used both
primary and secondary data collection methods. In the primary data, questionnaire were
conducted from different employees in the organization and a semi-structured interview
which were asked for the general manager of the organization and this is important for
gathering different information from employees. From a total 498 employees in the Ethio-
Telecom in Dire Dawa Branch, 83 were taken as sample size out of these the purposive
sampling technique was used to choose in sampling for managerial employees and simple
random sampling technique was used for managerial employee. In order to answer the basic
research questions stated, the qualitative and quantitative data collected through
questionnaires and interviews was analyzed. The study concludes that democratic leadership
style is highly used in Ethio Telecom at Dire Dawa Branch. Transformational and
transactional leadership styles also played a great role in enhancing employees’
performance. The study found that authoritative leadership style really play minimum role
on employee performance and laissez-faire style is associated with dissatisfaction,
unmotivated and ineffectiveness and from this study it is possible to say that laissez-faire style
had low impact on employee performance. However, from the result lack of experience to
tackle the problem, lack of training on the management and lack of effective leadership style
are influencing leadership to enhancing The study recommends that the organization should
crate training program to minimize laissez-faire leadership style and increase
transformational leadership style and transactional leadership style.
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TABLE OF CONTENTS
ACKNOWLEDGEMENT..........................................................................................................i
ABSTRACT...............................................................................................................................ii
TABLE OF CONTENTS............................................................................................................i
LIST OF TABLES....................................................................................................................iv
CHAPTER ONE........................................................................................................................1
1. INTRODUCTION..............................................................................................................1
1.1. Background of the Study.................................................................................................1
1.2. Statement of the Problem................................................................................................3
1.3. Research Questions.........................................................................................................4
1.4. Objective of the study.....................................................................................................4
1.4.1. General objective.....................................................................................................4
1.4.2. Specific objectives...................................................................................................4
1.5. Significance of the Study................................................................................................4
1.6. Scope of the Study..........................................................................................................5
1.7. Limitation of the study....................................................................................................5
1.8. Organization of the Paper................................................................................................5
1.9. Definitions of key terms..................................................................................................5
CHAPTER TWO.......................................................................................................................6
2. REVIEW OF RELATED LITERATURE.............................................................................6
2.1. Theoretical Review.........................................................................................................6
2.1.1. Concepts of Leadership............................................................................................6
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2.1.2. Leadership Theories.................................................................................................7
2.1.3. Types of Leadership Styles......................................................................................9
2.1.4. Role of Leadership Style on Employee Performances...........................................12
2.2. Empirical Related Review.............................................................................................14
CHAPTER THREE..................................................................................................................17
3. METHODOLOGY OF THE STUDY.................................................................................17
3.1. Description of the study area.........................................................................................17
3.2. Research Design............................................................................................................17
3.3. Research Approach.......................................................................................................17
3.4. Type and source of data................................................................................................18
3.5. Population of the study..................................................................................................18
3.6. Sample Size and Technique..........................................................................................18
3.7. Method of data collection..............................................................................................19
3.7.1. Questionnaire.........................................................................................................19
3.7.2. Interviews...............................................................................................................19
3.8. Method of data analysis................................................................................................19
3.9. Ethical Consideration....................................................................................................20
CHAPTER FOUR....................................................................................................................21
4. DATA ANALYSIS AND INTERPRETATION.................................................................21
4.1. Demographic Characteristics of the Respondents.........................................................21
4.2. The Types of Leadership Style in Ethio Telecom at Dire Dawa Branch......................22
4.2.1. Importance of Leadership in the Organization.......................................................22
4.2.2. Democratic Leadership Style.................................................................................24
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4.2.3. Authoritative Leadership Style..............................................................................25
4.2.4. Transactional Style Leadership Style.....................................................................26
4.2.5. Transformational Style Leadership Style...............................................................27
4.2.6. Laissez-faire Style Leadership Style......................................................................28
4.3. The Roles of Leadership Styles on Employee’s Performances....................................29
4.3.1. Descriptive Statistics on Employees Performances...............................................29
4.3.2. Leadership Style and Employees Performance......................................................30
4.4. The challenges of Leadership in enhancing Employee’s Performances.......................31
CHAPTER FIVE......................................................................................................................33
5. CONCLUSION AND RECOMMENDATION...................................................................33
5.1. Conclusion.....................................................................................................................33
5.2. Recommendation...........................................................................................................34
REFERENCES.........................................................................................................................35
APPENDIX..............................................................................................................................37
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LIST OF TABLES
Table 1: Characteristics of Respondents..................................................................................21
Table 2: Importance of Leadership in the Organization..........................................................22
Table 3: Response on Leadership Style in Ethio Telecom at Dire Dawa Branch....................23
Table 4: Democratic Style in Ethio Telecom at Dire Dawa Branch........................................24
Table 5: Authoritative Style in Ethio Telecom at Dire Dawa Branch.....................................25
Table 6: Transactional Style in Ethio Telecom at Dire Dawa Branch.....................................26
Table 7: Transformational Style in Ethio Telecom at Dire Dawa Branch...............................27
Table 8: Laissez-faire lin Ethio Telecom at Dire Dawa Branch..............................................28
Table 9: Descriptive Statistics on Employees Performance....................................................29
Table 10: Leadership Style and Employees Performance........................................................30
Table 11: Challenges of leadership in enhancing employee’s performances..........................31
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CHAPTER ONE
1. INTRODUCTION
1.1. Background of the Study
Nowadays, leadership is considered as a life blood of any organization and its importance
cannot be underestimated. The concept and definition of leadership and style may differ from
one person, or situation, to the other. The word leadership has been used in various aspects of
human endeavour such as politics, businesses, academics, social works, etc…, (Gogo, 2019).
Previous views about leadership show it as personal ability. Leader is person who influences,
directs, and motivates others to perform specific tasks and also inspire his subordinates for
efficient performance towards the accomplishment of the stated corporate objectives
(Michael, 2011).
Bizhan (2015) defined leadership as a pattern of managerial behavior designed to integrate

personal or organizational interest and effect, in pursuit of some objectives. Some leaders are
more interested in the work to be done than in the people they work with while others pay
more attention to their relationship with subordinates than the job. Whether a leader
emphasizes the task or human relations is usually considered central to leadership style.
Leadership style is viewed as the combination of traits, characteristics, skills and behaviors
that leaders use when interacting with their subordinates.
According to Fahad (2020) the concept of leadership is regarded as a vital feature of the
progress of each organization because of its influences at employee’s achievement. In a
continuously and revolutionary changing in a societal, industrial, and technological
environment, leadership is a more significant aspect of administration now than previously.
While leaders are focused on making supplies collectively, forming plans, designing plus
leading activities to manage recognized goals. Thus leadership makes the influencing role of
the administration.
Different leadership styles are used that fit to employees on the basis of amount of directions,
empowerment, and decision making power. An administrative phenomenon reflects the
contingency of leadership, and style, situation and performance criteria have been left to
suffocate on their own. As a result, employee performance was affected due to lack of proper
direction and application of strategic style in managing daily duties (Iqbal, 2016).
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Leadership is an important management role that involves motivation of employees towards
common objective. Leadership emphasizes on the establishment of followers and their needs.
Managers utilizing transformational leadership styles concentrate on the creation of value
system of employees, their motivational level and moralities with the development of their
skills. It essentially assists followers to achieve their goals as they work in the organization; it
also motivates followers to be supportive and attempt to adapt to new and better styles and
environmental shifts (Ismail, 2009).
The relationships between the leader and employee, as well as the quality of employees’
performance, are significantly influenced by the leadership style adopted by the leader.
Leadership in an organization is one of the factors that play significant role in enhancing or
retarding the interest and commitment of the individuals in the organization (Atieno, 2013).
According to Gogo (2019), leadership is a process of influencing others commitment towards
realizing their full potential in achieving a value-added, shared vision, with passion and
integrity. The nature of this influence is such that the members of the team cooperate
voluntarily with each other in order to achieve the objectives which the leader has set for each
member, as well as for the group.
Leadership is a critical management skill, involving the ability to encourage a group of

people towards common goal. Leadership focuses on the development of followers and their
needs. Managers exercising transformational leadership style focus on the development of
value system of employees, their motivational level and moralities with the development of
their skills (Ismail, 2009). Leadership style in many organizations has been facing different
challenges due to its effects on organizations’ performance, department, and teams, as well as
work climate and atmosphere. Thus, leaders are people who are able to think and act
creatively in non-routine situation and who set out to influence the action beliefs and feeling
of others. An important factor in the leadership process is the relationship that has with
individual followers. It is important to note that organizational system’s progress toward
change continuous. This study was intended to assess the role of leadership style on the
employee’s performance in Ethio-Telecom in the case of Dire Dawa Branch.
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1.2. Statement of the Problem
In this global competitive environment, effective leadership style is necessary to reduce the
attrition rate. From the effective leadership styles only it is possible to achieve organizational
goal productively. Leadership styles effect on the employee performance and productivity
(Nanjun and Swamy, 2014). Iqbal (2016) concluded that the autocratic leadership is useful in
the short term and democratic leadership style is useful in all time horizons. Leadership style
effects the organization by affecting employee morale, productivity, decision-making speed,
and metrics. Successful leaders carefully analyze problems, assess the skill level of
subordinates, consider alternatives, and make an informed choice. Unfortunately some
organizations do not take cognizance of the leadership style adopted by their managers
(Gogo, 2019).
Leadership is concerned with the directing function on the staff personnel and that in
administration what one need is to understand more than the enforcement of obedience.
Hence, the chief executive must apply the correct style of leadership, making sure discipline
is maintained as well as the ability to give the right instructions (Iqbal, 2016). Ethio telecom
Dire Dawa branch was one of the prominent in east regional states, and it has been endowed
with much responsibility to success of the organization. However, there was a problem in
Ethio telecom Dire Dawa branch, lack of employee motivation, absence of good leadership
style, and poor employee performance in the organization.
Regarding Ethio-Telecom in Ethiopia particularly in case of Dire Dawa Branch, no study was
observed to assess the roles of different leadership styles on employee performances. Most of
the previous studies were conducted on the other sector especially like Education, bank and
other. However, in recent times, many organizations, have recorded cases of immoral and
unethical practices, gratifications, high labour turnover, and inability to meet basic required
obligations, which has led to many organization being merged and acquired (Yohannes,
2014). Inline of the aforementioned statements this study will be sought to investigate the
roles of different leadership styles on employee performance in Ethio-Telecom at Dire Dawa
Branch. Therefore, to fulfill this gap this study was to assess the role of leadership style on
the employee’s performance in Ethio-Telecom in the case of Dire Dawa Branch.
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1.3. Research Questions
The study was sought to find answers to the following questions:-
1. What are the types of leadership style adopted by Ethio-Telecom in Dire Dawa
Branch?
2. What are the roles of different leadership style on employee’s performances in Ethio-
Telecom Dire Dawa Branch?
3. What are the challenges of leadership in enhancing employee’s performances in
Ethio-Telecom Dire Dawa Branch?
1.4. Objective of the study
1.4.1. General objective
The general objective of the study was to assess the role of leadership style on the employee’s
performance of Dire Adwa City Administration Dire Dawa Branch.
1.4.2. Specific objectives

The specific objectives of the study are;-
1. To identify the types of leadership style adopted by Ethio-Telecom in Dire Dawa
Branch.
2. To identify the roles of leadership style on employee’s performances in Ethio-Telecom
in Dire Dawa Branch.
3. To examine the challenges of leadership in enhancing employee’s performances in
Ethio-Telecom in Dire Dawa Branch.
1.5. Significance of the Study

The study would helpful knowing the influence of the leader in organization and explored
the ways to find out how can employees work together and improve leadership structure of
the organization, the study is cornerstone for other researchers ,the student researcher is
beneficiary on getting knowledge, experience and advantage on conducting the different data
about this study and have some the knowledge about assess the role of leadership for
employees performance for any business, also the study would help the management of
Ethio-Telecom to discover the role of leadership style on the employee’s performances.
Furthermore, this study would significant in adding on the existing literature on role of
leadership style on the employees’ performances hence providing reference for future studies
carried out on the same problem.
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1.6. Scope of the Study
This study was focused on the role of leadership style on the employee’s performances in
Ethio-Telecom in Dire Dawa Branch. The area coverage of this study was delimited to Ethio-
Telecom in Dire Dawa Branch. This is because it is difficulties to get detail information from
the whole Ethiopia. In this study the researcher was employed descriptive research design and
this study was conducted starting from July 2021 and end to October 2021.
1.7. Limitation of the study

Like other studies this study faced some limitation. The main limitation for this study is lack
of time to gather necessary information used for this study. The other limitation of the study
was reluctance and lack of willingness of the respondents to complete and return the
questionnaires on time unavailability. In addition to this data obtained may suffers from
inaccuracies data in some aspect of measurement, and although conducting. This research has
some limitation; lack of the related researches conducted, lack of finance to buy necessary
materials for research work and shortage of time to collect sufficient information for the
study.
1.8. Organization of the Paper

The study was organized in to five main chapters. The first chapter is an introductory part,
which contains background of the study, background of the organization, statement of the
problem, objective of the study, significance of the study, scope of the study and limitation of
the study. The second chapter provides review of related literature. The third chapter provides
the research methodology, such as source of data, sampling method, data collection and
analysis. The fourth chapter presents results, analysis and discussion of the data. The last
chapter provides the conclusion and recommendation forwarded.
1.9. Definitions of key terms

Leadership: the process in which the executive direct, support and influence the behavior and
work of other.
Leadership style: is a leader’s method of providing direction, implementing plans, and
motivating people.
Employee: is someone who gets paid to work for a person or company.
Employee Performance: is how a member of staff fulfills the duties of their role, completes
required tasks and behaves in the workplace.
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CHAPTER TWO
2. REVIEW OF RELATED LITERATURE
2.1. Theoretical Review
2.1.1. Concepts of Leadership
According to Levin (2000), leadership is the process of influencing others to work willingly
toward an organizational goal with confidence. For Veronica (2011), leadership is the
incremental influence that a person has beyond his or her formal authority. Generally,
leadership can be conceptualized as a process of influencing others towards the achievement
of some common goal. Leadership is a process by which executive can direct, guide and
influence the behavior and work of others towards the accomplishment of specific goals in a
given situation. Leadership is an ability of a manager to work with confidence and zeal.
Leadership can be defined as the capacity to influence a group realization of the goal. Leaders
are required to develop the future vision and to motivate the organizational members to want
to achieve the vision and to improve the performance (Adair, 2002).
The “Great Man” theory of leadership states that historically, a civilization’s leader has an
effect on the organization’s success. Leadership is one of the most extensively discussed
topics of research around the world and all groups and teams need a leader. A lot of
definitions have been presented in the field of leadership and leadership styles. Traditionally,
leadership has been defined in recent years as individual skills that are applied directly to the
organizations (Meindinyo, 2017).
In the literature, leadership has been identified as an important subject in the field of
organizational behavior. Leadership is one with the most dynamic effects during individual
and organizational interaction. In other words, ability of management to execute
“collaborated effort” depends on leadership capability. Leadership is life blood of any
organization and its importance cannot be underestimated. Leadership is as a process by
which an individual influence a group of individuals to realize a common goal (Fahad, 2020).
Atieno (2013) defined leadership as “an interaction between persons in which one presents
information of a sort and in such a manner that the other becomes convinced that his
outcomes will be improved if he behaves in the manner suggested or desired”. Furthermore,
Gogo (2019) stated that leadership is “the relationship in which one person, the leader, leads
others to work together willingly on related tasks to achieve that which the leader wishes”.
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2.1.2. Leadership Theories
2.1.2.1. Great-Man Theory
The effort toward explorations for common traits of leadership is protracted over centuries as
most cultures need heroes to define their successes and to justify their failures. In 1847,
Thomas Carlyle stated in the best interests of the heroes that “universal history, the history of
what man has accomplished in this world, is at the bottom of the history of the great men who
have worked here”. Carlyle claimed in his “great man theory” that leaders are born and that
only those men who are endowed with heroic potentials could ever become the leaders. He
opined that great men were born, not made. An American philosopher, Sidney Hook, further
expanded Carlyle perspective highlighting the impact which could be made by the eventful
man vs. the event-making man (Dobbins & Platz, 1986).
He proposed that the eventful man remained complex in a historic situation, but did not really
determine its course. On the other hand, he maintained that the actions of the event-making
man influenced the course of events, which could have been much different, had he not been
involved in the process. The event making man’s role based on “the consequences of
outstanding capacities of intelligence, will and character rather than the actions of
distinction”. However, subsequent events unfolded that this concept of leadership was
morally flawed, as was the case with Hitler, Napoleon, and the like, thereby challenging the
credibility of the Great Man theory. These great men became irrelevant and consequently
growth of the organizations, stifled (MacGregor, 2003). “The passing years have given the
coup de grace to another force the great man who with brilliance and farsightedness could
preside with dictatorial powers as the head of a growing organization but in the process
retarded democratization”. Leadership theory then progressed from dogma that leaders are
born or are destined by nature to be in their role at a particular time to a reflection of certain
traits that envisage a potential for leadership.
2.1.2.2. Trait Theory

The early theorists opined that born leaders were endowed with certain physical traits and
personality characteristics which distinguished them from non-leaders. Trait theories ignored
the assumptions about whether leadership traits were genetic or acquired. Jenkins identified
two traits; emergent traits (those which are heavily dependent upon heredity) as height,
intelligence, attractiveness, and self-confidence and effectiveness traits (based on experience
or learning), including charisma, as fundamental component of leadership (Ekvall &
Arvonen, 1991). Max Weber termed charisma as “the greatest revolutionary force, capable of
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producing a completely new orientation through followers and complete personal devotion to
leaders they perceived as endowed with almost magical supernatural, superhuman qualities
and powers”.
This initial focus on intellectual, physical and personality traits that distinguished non-leaders
from leaders portended a research that maintained that only minor variances exist between
followers and leaders (Burns, 2003). The failure in detecting the traits which every single
effective leader had in common, resulted in development of trait theory, as an inaccessible
component, falling into disfavor. In the late 1940s, scholars studied the traits of military and
non-military leaders respectively and exposed the significance of certain traits developing at
certain times.
2.1.2.3. Contingency Theories (Situational)

The theories of contingency recommends that no leadership style is precise as a stand-alone
as the leadership style used is reliant upon the factors such as the quality, situation of the
followers or a number of other variables. “According to this theory, there is no single right
way to lead because the internal and external dimensions of the environment require the
leader to adapt to that particular situation”. In most cases, leaders do not change only the
dynamics and environment, employees within the organization change.
In a common sense, the theories of contingency are a category of behavioral theory that
challenges that there is no one finest way of leading/organizing and that the style of
leadership that is operative in some circumstances may not be effective in others (Greenleaf,
1977). Contingency theorists assumed that the leader was the focus of leader-subordinate
relationship; situational theorists opined that the subordinates played a pivotal role in defining
the relationship. Though, the situational leadership stays to emphasis mostly upon the leader,
it creates the significance of the focus into group dynamic. “These studies of the relationships
between groups and their leaders have led to some of our modern theories of group dynamics
and leadership”. The theory of situational leadership proposes that style of leadership should
be accorded with the maturity of the subordinates (Bass, 1997). “The situational leadership
model, first introduced in 1969, theorized that there was no unsurpassed way to lead and
those leaders, to be effective, must be able to adapt to the situation and transform their
leadership style between task-oriented and relationship oriented”.
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2.1.3. Types of Leadership Styles
Leadership theories present various leadership styles including charismatic leadership,
transactional leadership, and transformational leadership. Cheng (2005) also identify four
widely accepted and used leadership styles: democratic, autocratic, dictatorial, and laissez
faire leadership. One of the most prominent formats for classifying and studying leadership
includes three leadership styles laissez-faire (non-leadership), transactional (based on reward
system and punishments) and transformational (based on inspiration and behavioral
charisma) (Cheng, 2005). Below is a brief examination of some common leadership style
dimensions listed above and their potential impact on organizational performance.
2.1.3.1. Transactional Leadership

Transactional leadership can be described as a style of leadership in which the leader
champions compliance of the followers through both reward and punishment. Opposing
transformational leadership, transactional leaders would rather keep their current situation
because they are not optimistic about change in the future. They are faultfinders, since they
always find a way to track faults in the employees. Transactional leadership is better adopted
in crisis and emergency situations, as well as when work is needed to be carried out in a
specific mode. Transactional leaders conduct their business by identifying the needs of their
followers and donating rewards satisfying these needs for positive performances (Dubrin,
2007).
Transactional leadership, present in many businesses, may help clarify everyone's roles and
responsibilities, and because team members are judged on performance, ambitious people
motivated by external rewards often thrive. Some of its measures can also de-motivate
employees. For example, it doesn’t offer much in terms of inspiration, to motivate people to
go beyond the basics; therefore employees might get complacent and develop a tendency to
achieve minimal expectations that only would help them avoid (Cheng, 2005).
In transactional leadership all things are seen with the overall amount of benefits the
individuals get and the relationship between the leader and disciples is speculative based on
exchanging one thing for another. Atieno (2013) believe that transformational leaders are
more successful than transactional ones. Empirical results also indicate that this approach
gives transformational leaders more success, making their leading more comprehensive, and
effective than transactional leaders (Harris and Muijs, 2005).
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Al-Safran (2015) state that the transformational leader, compared to transactional ones, are
more likely to reduce individuals’ displacement. Transformational leaders also increase
production, returns, and employees’ job satisfaction Transactional leadership, also known as
managerial leadership, pays attention to the social interactions and transactions between
leaders and followers. It focuses on supervision, organization, and group performance.
The leader’s freedom to act is constrained by the followers’ perception of the leader.
Followers will only show the demanded behaviors when they experience a certain authority
over them and when there are possibilities for rewards. Leaders motivate their subordinates
through observing their performances and reacting to errors and failures. A transactional
leader is aware of the needs of his or her followers and facilitates negotiation with them to
meet the overall need of the company or group (Yohannes, 2014). A transactional leader will
do all the tasks with his followers to meet the final target.
2.1.3.2. Transformational Leadership

Transformational leadership was used for the first time by Danton, although it was not
reputable until it was being used by the classics. Recent expansions in leadership theories
have transferred from leadership theories with a charismatic ideal in which the assumed
leader is an unusual creature and his or her disciples are dependent on leadership. This
expansion works toward neo-charismatic and transformational theories, which note
development and empowering disciples in order to have independent functions.
Transformational leadership has originated from charismatic leadership. Charisma is a Greek
word, which means gift of grace. Power is charismatic which has been derived from faith
towards a leader with a symbolic character. Moreover, expressing a mission, challenging the
objective, and motivating others are also important aspects.
Transformational leadership is formed when the leader promotes his or her employees’
interests, by creating awareness and the acceptance for the mission at hand and the end
destination of the group. Through its words and acts, transformational leadership transforms
the whole organization and has a lot of influence on its followers. It basically helps follower’s
achieve their goals working in the organizational setting; it encourages followers to be
expressive and adaptive to new and improved practices and changes in the environment
(McColumn, 2010). Bass further explains that such leadership motivates followers; it moves
people beyond self-interests and allows them to focus on the good of the group or society.
Transformational leaders are able to articulate an appealing vision of the future by
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communicating ideologies and leading through example. This leadership tends to improve the
team's morale and motivates the team members. The study conducted by (Fahad et al, 2020)
concluded that the degree of transformational leadership (charisma, intellectual stimulation,
and individual consideration) in a branch manager had a direct impact on the business unit's
performance.
2.1.3.3. Bureaucratic Leadership

Bureaucratic leaders create, and rely on, policy to meet organizational goals. Policies drive
execution, strategy, objectives and outcomes. Bureaucratic leaders are most comfortable
relying on a stated policy in order to convince followers to get on board. In doing so they
send a very direct message that policy dictates direction. Bureaucratic leaders are usually
strongly committed to procedures and processes instead of people, and as a result they may
appear aloof and highly change adverse. The specific problem or problems associated with
using policies to lead are not always obvious until the damage is done. The danger here is that
leadership’s greatest benefits, motivating and developing people, are ignored by bureaucratic.
This leadership style is appropriate for work involving serious safety risks or with large sums
of money such as banks or when managing employees who perform routine tasks. This style
is much less effective in teams and organizations that rely on flexibility, creativity, or
innovation (McColumn, 2010).
2.1.3.4. Democratic Leadership

Democratic leadership as one where decision-making is decentralized and shared by
subordinates. The potential for poor decision-making and weak execution is, however,
significant here. The biggest problem with democratic leadership is its underlying assumption
that everyone has an equal stake in an outcome as well as shared levels of expertise with
regard to decisions. That is rarely the case. While democratic leadership sounds good in
theory, it often is bogged down in its own slow process, and workable results usually require
an enormous amount of effort (Atieno, 2013).
2.1.3.5. Autocratic Leadership

These leaders are inexperienced with leadership thrust upon them in the form of a new
position or assignment that involves people management. Autocratic leaders retain for
themselves the decision- making rights (Cheng, 2005). They can damage an organization
irreparably as they force their ‘followers’ to execute strategies and services in a very narrow
way, based upon a subjective idea of what success looks like. There is no shared vision and
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little motivation beyond coercion. Commitment, creativity and innovation are typically
eliminated by autocratic leadership. In fact, most followers of autocratic leaders can be
described as biding their time, waiting for the inevitable failure this leadership produces and
the removal of the leader that follows (Gogo, 2019).
2.1.3.6. Laissez-faire Leadership

The manager delegates almost all authority and control to subordinates. There is no person of
authority in the organization. The manager leads the organization indirectly, he/she does not
make decisions; rather he/she abides by popular decisions. There is no setting of goals and
objectives by the manager. Tasks are done the way the manager thinks it should be done, but
he/she gets involved on request and this may lead to the digression from broad organizational
policy. Thus, this style of leadership may be effective with well-motivated and experienced
employees, but could lead to failure when subordinates are deceptive, unreliable and
untrustworthy. Laissez-faire style is associated with managers with dissatisfaction,
unproductiveness and ineffectiveness (Dubrin, 2007).
2.1.3.7. Charismatic Leadership

Charismatic leadership style is considered to be the most successful and valued trait-driven
leadership style. Charismatic leaders have a vision, as well as a personality that motivates
followers to execute that vision. This style provides fertile ground for creativity and
innovation, and is often highly motivational. However, a problem arises when they leave the
organization it can appear rudderless and without direction for long because charismatic
leaders rarely develop replacements. Their leadership is based upon strength personality. As a
result, charismatic leadership usually eliminates other competing, strong personalities
(Michael, 2011).
2.1.4. Role of Leadership Style on Employee Performances

Studies have suggested that effective leadership behaviors can facilitate the improvement of
performance when organizations face these new challenges. On the other hand,
organizational performance refers to ability of an enterprise to achieve such objectives as
high profit, quality product, large market share, good financial results, and survival at pre-
determined time using relevant strategy for action. Organizational performance can also be
used to view how an enterprise is doing in terms of level of profit, market share and product
quality in relation to other enterprises in the same industry. Consequently, it is a reflection of
12
productivity of members of an enterprise measured in terms of revenue, profit, growth,
development and expansion of the organization (Al-Safran, 2015).
Understanding the effects of leadership on performance is also important because leadership

is viewed by some researchers as one of the key driving forces for improving a firm’s
performance. Effective leadership is seen as a potent source of management development and
sustained competitive advantage for organizational performance improvement (Atieno,
2013).
For instance, transactional leadership helps organizations achieve their current objectives
more efficiently by linking job performance to valued rewards and by ensuring that
employees have the resources needed to get the job done (Fahad, 2020). Visionary leaders
create a strategic vision of some future state, communicate that vision through framing and
use of metaphor, model the vision by acting consistently, and build commitment towards the
vision (Nampa, 2007). Some scholars like Dubrin (2007), suggest that visionary leadership
will result in high levels of cohesion, commitment, trust, motivation, and hence performance
in the new organizational environments.
Relationship between leadership style and organizational performance has been discussed
often. Most research showed that leadership style has a significant relation with
organizational performance, and different leadership styles may have a positive correlation or
negative correlation with the organizational performance, depending on the variables used by
researchers (Fu-Jin, 2010). Al-Safran (2015) has indicated that there is significant
relationship between leadership styles and organizational performance. Effective leadership
style is seen as a potent source of management development and sustained competitive
advantage, leadership style helps organization to achieve their current objectives more
efficiently by linking job performance to valued rewards and by ensuring that employees
have the resources needed to get the job done. Al-Safran (2015) compares leadership style
with the leadership performance in schools and enterprises, and found that leadership style
had a significantly positive correlation with the organizational performance in both schools
and enterprises.
Broadly speaking, leadership performance is identical with organizational performance.

Business management attributes their successes to leadership efficiency, that is, the
leadership style of administrative supervisors has a considerable effect on the organizational
13
performance (Sun, 2002). Fu-Jin et al. (2010) opine that when executives use their leadership
style to demonstrate concern, care and respect for employees, it would increase interest of
employees in their work and enable them to put up better performance, thereby affecting their
job satisfaction positively.
2.2. Empirical Related Review

Researches have revealed that leadership style has conflicting relationships with
organizational performance and that leadership styles may be positively correlated or
negatively correlated to organizational performance (FuJin et al., 2011). Significant
relationship has been determined between leadership styles and organizational performance
(McGrath and MacMillan, 2000). Atieno (2013) conducted study on the Influence of
Principals’ Leadership Styles on Students’ Achievement in Kenya Certificate of Secondary
Education in Awendo District, Kenya. The finding indicates Principals’ democratic
leadership styles had a high response which is a good indicator that if applied well could have
quality results than autocratic leadership styles.
David, Aunga, Obadia and Masare etal. (2017) studied the role of leadership styles on
teacher’s performance in primary schools of Arusha District Tanzania .The study concluded
that teachers’ performance is good in the primary schools in Arusha district. There is a
significant relationship between Transformational Leadership Style and Teachers’
Performance. The researcher recommended that head teachers should use democratic and
transformational leadership styles due to the fact that democratic and transformational
leadership styles increases teachers’ performance.
Fahad (2020) studied the Impact of Principal Leadership Styles on Teachers Performance in
Public Elementary Schools in Jeddah, Kingdom of Saudi Arabia.
Meindinyo, Ibara, and Tuatongha (2017) studied Leadership Styles of Secondary School
Principals and Teachers’ Job Satisfaction in Yenagoa Local Government Area of Bayelsa
State, Nigeria. These are group consultative decision making participant/supportive and
supportive consultative styles of leadership. Yohannes (2014) studied practices and problems
of secondary school leadership in West Wollega Administrative Zone. He found that the
school leaderships are accountable for the overall operations of the school. That is, they
should show good leadership practices that currently ensure efficiency and effectiveness in
the provision of quality education.
14
Jay (2014) studied the Principals’ Leadership Style and Teachers Performance in Secondary
Schools of Gambella Regional State. The finding indicated that the better performance
depends on Principals who reward their teachers in terms of monetary, promotion, and verbal
appreciation for any duty delegated are democratic in nature. Such rewards motivate teachers,
make them committed and hardworking thereby enhancing their performance.
Abiso, Okuboyejo, Ilori & Adeogun, (2016) posited that organizational performance is a
replication of productivity of employees of a company assessed in terms of revenue, profit,
growth, development and organizational expansion. The researcher stressed that studying the
impact of organizational leadership on organizational performance is also essential because
leadership is perceived by certain scholars as among the determinants of firm performance.
Therefore, leadership effectiveness represents a potent source of management development
and sustained competitive advantage for organizational performance enhancement (Ilori &
Adeogun, 2016).
Leadership has a direct cause-effect relationship on organizations and their performance.

Leaders determine values, culture, tolerance for change, and motivation for employees
(Aboshaqah etal., 2015). They shape organizational approaches, including their efficacy and
implementation. It must be emphasized that leaders could be seen at any organizational level
and are not exclusive to management (Igbaekemen, 2014). Leaders must be capable of
determining whether their leadership skills affect their followers as it supports or does not
help the followers. This may have an effect on the actions of employees to follow their
leaders; followers or employees who do not have respect towards the leaders may be
susceptible to disappointment, which may give rise to an employee's intention of leaving
(Aboshaqah etal., 2015). Ilaboya and Obaretin (2015) found a positive relationship between
board size and profitability-measured corporate financial performances. Obiwuru, Okwu,
Akpa and Nwankwere (2011) found that the two variables had no significant effect.
Lussier (2008) suggested a significant relationship exists between transformational

leadership, employee engagement strategies, and performance of employees. Achua and
Lussier (2013) later found that transformational leadership aims to shift the status quo by
articulating the issues in the existing structure to followers and a clear vision of what might
be new organizations. According to Ukaidi (2016), leadership style and systemic behavior
shifted away from the characteristics of the leader to the style the leader adopted. According
to Rowe (2001), records from the style approach recommend that leaders who are devoted to
15
democratic or participatory leadership style seem more successful, compared to managers
that adopt autocratic or laissez faire leadership style of management. Yukl (2012) opined that
participatory leadership is the best style of leadership in managing an organizational system
of any type, and maintained that people react favorably to it in organizations by increased
productivity, lower unit cost, good morale and improved labor management relation.
However, Yukl (2012) hinted that the worst style of leadership is autocratic or authoritative
leadership style which gives rise to high labor management conflicts.
16
CHAPTER THREE
3. METHODOLOGY OF THE STUDY
3.1. Description of the study area
This study was conducted in Ethio-Telecom, Dire Dawa is a city in eastern Ethiopia near the
Somali border and one of two chartered cities in Ethiopia (the other being Addis Ababa, the
capital). Dire Dawa lies in the eastern part of the nation, on the Dechatu River, at the foot of a
ring of cliffs. The western outskirts of the city lie on the Gorro River, a tributary of the
Dechatu River. It is located at the latitude and longitude of 9°36′N 41°52′ECoordinates:
9°36′N 41°52′E. The city is an industrial center, home to several markets and the Dire Dawa
Airport. The projected population for 1 July 2015 was 440,000 for the entire chartered city
and 277,000 for the city proper, making the latter the seventh largest city in Ethiopia. Like
Addis Ababa, Dire Dawa is a City Administration, governed by a Mayor. The lowest
administrative level in Dire Dawa is the woreda. A woreda is run by a woreda administrator,
who is the representative of the executive power on one hand and on the other, by an elected
council (DDA, 2020).
3.2. Research Design

A descriptive research design was employed in this study to assess the role of leadership style
on the employee’s performance. The reason for using this design is that it’s easy to describe
and interpret those roles of leadership style on the employee’s performance. Data necessary
to answer the research questions were collected and have both qualitative and quantitative
nature. This design enabled the researcher to use more than one technique such as interviews,
questionnaires, and others to gather data (Krishnaswamini, 2003). It is flexible in data
collection and analysis. It was attempted to describe the compensation management system
and employees perception on the exiting leadership style in Ethio Telecom.
3.3. Research Approach

To obtain the advantage of both the qualitative and quantitative research approach and at the
same time to overcome their limitation, the mixed approach was used in this study.
Qualitative approach relating to quality or kind of information that the researcher was
generated through interview; and quantitative data based on the measurement of quantity that
were collected through questionnaire and percentage, table and figure could be employed for
analysis.
17
3.4. Type and source of data
With the intention of addressing its objectives the research was based on both primary and
secondary data. The primary data were collected through questionnaires and interviews. It
includes open ended and close ended questions. The secondary data were collected from the
organizations working processes, policies, procedures, and other documents which are related
with the compensation practice in the company and also from different literatures on the area.
3.5. Population of the study

The target populations of this study were employees from the Ethio Telecom at Dire Dawa
Branch estimated to be 498 employees according information from Human Resource.
3.6. Sample Size and Technique

From a target population of the estimated total employees (498) from the Ethio Telecom at
Dire Dawa Branch, the researcher were drawn a sample of 83 respondents to represent the
whole population by using the formula presented below. Due to the fact that, the actual total
population for the study is known, the researcher was computed the minimum sample size
required for accuracy in estimating proportions by considering the confidence interval (0.1 or
10%). The formula is: Yamane (1967) formula was used to determine sample size for this
study.
N
n= ¿
1+ N ¿ ¿
Where:
n= Number of sample taken
N= Population size
e = sampling error
498 498
Therefore,n= ¿, ,n = 83
1+ 498 ¿ ¿ 5.98
Therefore, the researcher was distributed 83 questionnaires to collect data required for doing
this study and simple random sample was used to select those who filled the questioners. A
simple random sample is a subset of a statistical population in which each member of the
subset has an equal probability of being chosen.
3.7. Method of data collection
18
The study was used questionnaire, interview and use of secondary data in data collection on
the roles of leadership style on the employee’s performance in Ethio Telecom at Dire Dawa
Branch. These methods were explained below.
3.7.1. Questionnaire
A questionnaire was employed for data collection during the study. Both closed and open
ended questions will be asked to respondents. A questionnaire was used to collect data from
sample respondents (employees). The questionnaire was distributed to these employees.
Information such as demographic information, type and kind of compensation offered by the
employer were addressed; perceptions of employee regarding leadership style as well as
practical procedure of leadership style were also inquired using questionnaire.
3.7.2. Interviews
Interviews were conducted by the researcher with the human resource manager. This method
gave the respondents freedom to respondents to provide details information based on study
objectives. In order for the researcher to be able to organize information, the researcher was
adopted structured interviews around based on the objectives.
3.8. Method of data analysis

The study was used descriptive analysis in analyzing the information gathered from the field.
Data were collected and analyzed in a way that it answered the research questions based on
the objectives of the study. The study is descriptive in nature as it describes the relationship
between objectives and the results of the study. It involved examining data basing on the
attributes shown by the respondents and making discussion with them. In quantitative
analysis the researcher was used percentages, tables and frequencies. Whereas, the data
gathered through interview and data gathered through secondary sources of data were
analyzed and used to elaborate major facts related to the existing employees’ compensation
practices of Ethio Telecom.
3.9. Ethical Consideration
19
The researcher was interested to maintain scientific objectivity throughout the study,
recognizing the limitation of his competence. Every person was involved in the study was
entitled to the right of privacy and dignity of treatment and no person harm was case to
subjects in the researcher. Information obtained was held in strict confidentiality by the
research. All assistance, collaboration of other and sources from which information were
drawn are acknowledgeable.
CHAPTER FOUR
20
4. DATA ANALYSIS AND INTERPRETATION
This chapter is concerned with presentation, interpreting and analyzing of data using
descriptive analysis was used to process and analysis the data that were collected from the
sample of 83 employees of Ethio Telecom at Dire Dawa Branch to assess the role of
leadership style on the employee’s performance of Ethio Telecom at Dire Dawa Branch. The
data gathered through questionnaire was analyzed and presented in order to respond to the
research questions posed in the first chapter. The analysis is conducted by comparing the
scores of the responses given by the respondents to each likert scale question and conclusions
are drawn from the scores by interpreting the results with respect to the research question
under which the individual question is categorized.
4.1. Demographic Characteristics of the Respondents
Table 1: Characteristics of Respondents
Characteristic Option Frequency Percent
Sex Male 59 71.1
Female 24 28.9
Total 83 100
Age 18 - 25 years 11 13.3

26- 40 years 50 60.2
41-55 years 22 26.5
Total 83 100
Educational Level Diploma 6 7.2

BA/BS Degree 65 78.3
MA/MSc Degree 12 14.5
Total 83 100
Work Experience Less than 5 years 17 20.5

6-10 years 31 37.3
11- 15 years 27 32.5
> 15 Years 8 9.6
Total 83 100
Source: Own survey data, 2021
21
Table 1 shows that the characteristics of respondents. From the result about 59(71.1%) of the
respondents are males while 24(28.9%) respondents were females. The result indicated that
male respondents were more than female respondents and hence the results of the study are
not tilted towards any gender. Regarding the age of the respondents, as indicates in table 1,
out of 83 questionnaires returned, 11(13.3%) of the respondents were at the age of 18-25
years, 50(60.2%) of the respondents were at the age of 26- 40 years, and the rest 22(26.5%)
of the respondents were at the age between 41-55 years. This implies that employees are
mature enough to provide accurate data which improve the quality of the study.
Regarding their educational level only 6(7.2%) respondents had reached the diploma,
65(78.3%) had degree meanwhile 12(14.5%) of respondent had master. This displays that
majority of employees had sufficient educational background and matured so as to provide
sufficient information about the role of leadership style on the employee’s performance.
Regarding the work experience as seen in the table above, most respondents of the study,
11(21.2%) had less 5 years' experience, yet 21(40.4%) had in 6-10 years' experience,
15(28.8%) had in 11-15 years' experience and 5 (9.6%) were in the above 15 years of
experience. The highest representation was (40.4%), which implied that most employees in
Ethio Telecom at Dire Dawa Branch had not enough experience at their work stations to help
them and execute their duties satisfactorily.
4.2. The Types of Leadership Style in Ethio Telecom at Dire Dawa Branch
4.2.1. Importance of Leadership in the Organization
Table 2: Importance of Leadership in the Organization

Questions Alternatives Frequency Percent
What is importance of leadership in Motivating 40 48.2
your organization? Greeting confidence 25 30.1
Providing guidance 18 21.7
Total 83 100
Table 2 above demonstrates the response of the employees that were contacted on the
importance of leadership in Ethio Telecom at Dire Dawa Branch. Accordingly, most of the
respondents 48.2% are responded motivation followed by 30.1% of the respondents answered
22
greeting confidences and the rest 21.7% are responded providing guidance. In addition to this
on the open ended questionnaires the respondents are gave their opinion towards the
importance of leadership. Thus the result indicated that formulating aims and objectives,
establishing structures, managing and motivating personnel and providing leadership. Some
of them also stated that leadership style in an organization is one of the factors that play
significant role in enhancing the employee’s performance.
Table 3: Response on Leadership Style in Ethio Telecom at Dire Dawa

Branch
Leadership Style Frequency Percent
Democratic Style 29 34.9
Transactional Style 24 28.9
Transformational Style 15 18.1
Authoritative Style 10 12
Laizzes Fair Style 5 6
Total 83 100
Table 3 shows that the leadership style mainly practiced in Ethio Telecom at Dire Dawa
Branch. The result indicate 34.9% of the respondents confirmed that democratic style, 28.9%
was transactional style, 18.1% was transformational style, 12% was authoritative style, and
the rest 6% of the respondents indicates that laizzes fair style. This implies that democratic
leadership style impacted positively on the employee performance, transformational and
transactional leadership styles also played a great role in enhancing employees’ performance.
But authoritative and laissez-faire are played little roles in enhancing employees’
performance.
23
4.2.2. Democratic Leadership Style
Table 4: Democratic Style in Ethio Telecom at Dire Dawa Branch
Items Strongly Strongly
Disagree Disagree Neutral Agree Agree Mean
Fre % Fre % Fre % Fre % Fre %
My manager friendly and
5 6 10 12 25 30.1 26 31.3 17 20.5 3.48
approachable to fellow
employees
I am involved in performance
5 6 10 12 32 38.6 14 16.9 22 26.5 3.46
appraisals to my department and
decision making
The manager helps others to
5 6 10 12 32 38.6 8 15.4 22 26.5 3.46
develop themselves
The manager gives personal
5 6 15 18. 32 38.6 14 16.9 17 20.5 3.28
attention to others who seems 1
rejected
Overall Mean 3.42
Table 4 shows that the opinion of the employees towards democratic style in Ethio Telecom
at Dire Dawa Branch. 26(31.3%) and 17(20.5%) of the respondents agreed and strongly agree
on manager friendly and approachable to fellow employees. The mean score of this item was
3.48. This implies that the manager has friendly and approachable to fellow employees in the
organization. 14(16.9%) and 22(26.5%) of the respondents agreed and strongly agree on
involved in performance appraisals to their department and decision making. The mean score
of this item was 3.46. 8(15.4%) and 22(26.5%) of the respondents agreed and strongly agree
on manager helps others to develop themselves. The mean score of this item was 3.46.
14(16.9%) and 16(20.5%) of the respondents agreed and strongly agree on manager helps
others to develop themselves. The mean score of this item was 3.28. The study result
indicates that democratic leadership style highly used in Ethio Telecom in Dire Dawa Branch.
This implies that an employee of the organization has highly performed this style. Most of the
above responses answered not highly familiar with democratic leadership in the institutions.
24
4.2.3. Authoritative Leadership Style
Table 5: Authoritative Style in Ethio Telecom at Dire Dawa Branch
Items Strongly Strongly Mean
Disagree Disagree Neutral Agree Agree
Fr % Fre % Fre % Fre % Fr %
e e
My performance is limited by
12 14.5 32 38.6 39 47 0 0 0 0 2.33
poor leadership from my
supervisor
My performance is not limited
2.16
by leadership 14 16.9 45 54.2 22 26.5 1 1.2 1 1.2
Leadership rules are designed
2.55
by superiors 9 10.8 29 34.9 38 45.8 4 4.8 3 3.6
My performance is assessed
2.47
by my supervisor alone 10 12 31 37.3 36 43.4 5 6 1 1.2
Performance requirements are

2.24
designed according to the 15 18.1 38 45.8 27 32.5 1 1.2 1 1.2
leader’s needs
Overall Mean 2.35
Table 5 shows that the opinion of the employees towards authoritative style in Ethio Telecom
at Dire Dawa Branch. 12(14.5%) and 32(38.6%) of the respondents disagreed and strongly
disagree on that employees performance is limited by poor leadership from supervisor. The
mean score of this item was 2.33. This implies that it is true that employee performance is
determined by leadership style. 14(16.9%) and 45(54.2%) of the respondents agreed and
strongly agree on their performance is not limited by leadership. This indicates most
managers believed that performance measurement was conducted the authoritative way
where a few or no employees are consulted when the supervisors are conducting performance
appraisals. The mean score of this item was 2.47. 9(10.8%) and 28(34.9%) of the respondents
agreed and strongly agree on the performance is not limited by leadership. The mean score of
this item was 2.55. 9(12%) and 31(37.3%) of the respondents agreed and strongly agree on
leadership rules are designed by superiors. The mean score of this item was 2.24. This was
authoritative to the extent that employees who were taken as poor performers would be
25
surprised with letters of termination of work. This also implies that the authoritative
leadership style really play minimum role on employee performance.
4.2.4. Transactional Style Leadership Style
Table 6: Transactional Style in Ethio Telecom at Dire Dawa Branch
Fr % Fre % Fre % Fre % Fr %
e e
My manager gives me reward
or recognition when I reach 5 6 10 12 24 28.9 28 33.7 16 19.3
3.48
the goal
My manager tells me what to
do if I want recognition or 5 6 11 13.3 28 33.7 26 31.3 13 15.7
3.37
reward from work
My manager gives attention to
what others can gate for what 5 6 13 15.7 25 30.1 28 33.7 12 14.5
3.34
they accomplish
Overall Mean 3.40
Table 6 shows that the belief of the employees towards transactional style in Ethio Telecom
at Dire Dawa Branch. Majority of respondents that rated in favor of the issue that manager
gives reward or recognition when reach the goal is 28(33.7%) and 16(19.3%) rated to agree
and strongly agree. The mean score of this item was 3.48. The issue that the manager tells
employees what to do 26(31.3%) and 13(15.7%) rated to agree and strongly agree. The mean
score of this item was 3.37. The issue that the manager gives attention to what others can gate
for what they accomplish 28(33.7%) and 12(14.5%) rated to agree and strongly agree. The
mean score of this item was 3.37. The overall transactional leadership style in Ethio Telecom
at Dire Dawa Branch scored 3.40. Hence, leaders in Ethio Telecom at Dire Dawa Branch
understand and well know the concept of promotion procedures in order to increase the
employees’ performance.
26
4.2.5. Transformational Style Leadership Style
Table 7: Transformational Style in Ethio Telecom at Dire Dawa Branch
Fr % Fre % Fre % Fre % Fre %
e
There is idealized and
5 6 13 15.7 33 39.8 20 24.1 12 14.5 3.25
influential leadership in my
organization
The leaderships are motivators
5 6 12 14.5 24 28.9 27 32.5 15 18.1 3.44
of workers in my organization
Leaderships are given equal
6 7.2 14 16.9 24 28.9 24 28.9 15 18.1 3.40
consideration in work place
Leaderships in my
6 7.2 14 16.9 24 28.9 24 28.9 15 18.1 3.31
organization are good
communicators with
employees
Overall Mean 3.35
Table 7 shows that the belief of the employees towards transformational style in Ethio
Telecom at Dire Dawa Branch. 20(24.1%) and 12(14.5%) of the respondents agreed and
strongly agree there is idealized and influential leadership in organization. The mean score of
this item was 3.25. This implies that the manager has friendly and approachable to fellow
employees in the organization. 27(32.5%) and 15(18.1%) of the respondents agreed and
strongly agree that the leaderships are motivators of workers. The mean score of this item
was 3.44. This is the highest score implies that leaderships are motivated employees which
might be encourage the employees performance.
Form the above result 24(28.9%) and 15(18.1%) of the respondents agreed and strongly agree
that leaderships are given equal consideration in work place. The mean score of this item was
3.40. This is the second highest score implies that there is no discrimination. Also 24(28.9%)
and 15(18.1%) of the respondents agreed and strongly agree leaderships are good
communicators with employees. The mean score of this item was 3.41. This implies that the
availability of good communication between leaders and employees would contribute
employees’ performances.
27
4.2.6. Laissez-faire Style Leadership Style
Table 8: Laissez-faire lin Ethio Telecom at Dire Dawa Branch
Strongly Strongly
Items Disagree Disagree Neutral Agree Agree Mean
Fre % Fre % Fre % Fre % Fre %
Leaderships encourage
22 26.5 39 47 22 26.5 0 0 0 0 2.00
others to thinks their way
My manager relies on his/her
22 26.5 34 41 27 32.5 0 0 0 0 2.08
own judgment when passing
on performance requirement
There is leadership freedom 38 45.8 32 38.6 13 15.7 0 0 0 0 1.67
in my organization
My organization performs 55 66.3 10 12 18 21.7 0 0 0 0 1.54
with no leadership barriers
Overall Mean 1.83
Table 8 represented that the belief of the employees towards laissez-faire style in Ethio
Telecom at Dire Dawa Branch. The result denoted the fact that most employees 22(26.5%)
and 47(47%) strongly disagree and disagreed that there leaderships encourage others to thinks
their way. The mean score of this item was 2.00. The response is replied that in most
departments, there was less liberty to have laissez faire leadership prevailing in the different
departments. Most respondents 22(26.5%) and 34(41%) of the respondents strongly disagree
and disagreed that leader relies on his/her own judgment when passing on performance
requirement. The mean score of this item was 2.08. About 38(45.8%) and 32(38.6%) of the
respondents strongly disagree and disagreed that there is leadership freedom in organization.
The mean score of this item was 1.67. 55(66.3%) and 10(12%) of the respondents strongly
disagree and disagreed that the organization performs with no leadership barriers. The mean
score of this item was 1.54.
That means leaders are make policies without participating employees. This clearly indicate
that leaders of Ethio Telecom at Dire Dawa Branch were do not rely their own judgment
when pass on performance requirement, organization performs with no leadership barriers,
there is not leadership freedom in organization. The laissez-faire leader is one who believes
in freedom of choice for the employees, leaving them alone so they can do as they want.
28
During the interview process, most employees described numerous problems associated with
leadership style in Ethio Telecom at Dire Dawa Branch. It replied that most employees in the
organization agreed that their bosses were either very arrogant or did not care about important
performance measurements. Simply the supervisors want to satisfy their needs.
4.3. The Roles of Leadership Styles on Employee’s Performances

4.3.1. Descriptive Statistics on Employees Performances
The following are descriptive statistics showing how employees rated themselves on
performance.
Table 9: Descriptive Statistics on Employees Performance
Items N Mean Std. Dev.

3.69 1.24
I have good relationship with my manager 83
3.34 1.27
I am motivated to work in my organization 83
3.28 1.21
I am motivated to creativity in my organization 83
3.00 1.22
My colleagues encourage me to perform 83
3.33 0.91
There is team work in my organization 83
3.27 0.83
My supervisor is a team player 83
3.73 0.75
I check my appraisal to meet my duties 83
3.33 1.15
My performance/appraisal is accessed daily by my leader 83
1.76 0.89
My performance is limited by poor leadership styles 83
4.10 1.20
I am comfortable with my leadership styles 83
Overall Mean 3.28
Table 9 shows the mean score of how employees rated themselves on performance regardless
of the leadership style in the organization. The mean scores for employees’ performance
improvement ranged from 2.75 to 4.13. The highest obtained mean score (4.13) is related to
employees comfortable with leadership styles, good relationship with manager (3.75),
employees check appraisal to meet their duties (3.75), employees motivated to work (3.40),
there is team work (3.37) and employees performance/appraisal is accessed by leader (3.37).
The lowest score 2.75 related to performance is limited by poor leadership styles, colleagues
encourage to perform (3.06). From this regardless of the leadership style, only few employees
were reflected as low performances in the Ethio Telecom at Dire Dawa Branch across all
29
performance items while about more than half of the employees were responded as they had
agreed and strongly agree.
4.3.2. Leadership Style and Employees Performance

Table 10: Leadership Style and Employees Performance
Leadership Style N Mean Std. Dev.
Democratic Style 83 3.42 1.11
Authoritative Style 83 2.35 0.56
Transformational Style 83 3.40 1.05
Transactional Style 83 3.35 1.02
Laissez-faire Style 83 1.83 0.55
Employees Performance 83 3.28 0.67
As it can be observed from the Table 10, the researcher tried to indicate the mean score
difference between the leadership styles and employees performance. Based on the analyzed
data the highest mean score (3.42) is democratic style followed by transformational style
(3.40), transactional style (3.35), authoritative style (2.35), and lowest is laissez-faire style
(1.83). Regarding with employees performance the men score is 3.28. This implies that
aspects of democratic leadership are important for employee performance. This data also
implies that employees believe that they would want to experience aspects of improved
responsibility, improved employee relations, increased consultation, dialogue between them
and their supervisors, involvement in appraisals and consultations in decision making.
Democratic approach is needed to have efficiency and proper employee management that will
lead to improved performance.
Most employees believed that authoritative leadership negatively affects employees’

performance. Transactional leadership has to relate to performance, which means this leaders
clarify what is their expectations and remember success that positively contribute to higher
levels of effort and performance. Interview result also support employees are satisfied to
work with transformational leaders for they get support from their leaders. Manager was also
stated employees are satisfied to work for transformational leaders compared to transactional
ones for they see opportunity to develop their career through switching responsibilities. This
finding is in line with transformational leadership creates good working environment to
develop greater degree of independence and to boost up confidence through participating in
30
different responsibilities and duties. When employees are involved in number of assignments
they will get a chance to learn from experience and through time their leadership skill will
also be developed, which is one element of transformational leadership style.
The mean score difference between laissez-faire leadership style and employee performance
indicate that laissez-faire leadership style not play great role in improving employee
performance in the organization. Thus laissez-faire style is associated with dissatisfaction,
unmotivated and ineffectiveness and from this study it is possible to say that laissez-faire
style had low impact on the employee performance.
4.4. The challenges of Leadership in enhancing Employee’s Performances

The study also sought to identify the challenges encounter in leadership while enhancing
employee’s performances. The multiple type of response from the employees’ analyses and
presented as follows.
Table 11: Challenges of leadership in enhancing employee’s performances
Item Frequency Percentage
Insufficient staff and funds
51 61.45
Lack of effective leadership style
53 63.86
Lack of training on the management
55 66.27
Lack of experience to tackle the problem
58 69.88
Lack of clear understanding the organizational policy
42 50.6
Unable to create team building for collaborative work
47 56.63
Lack of good relationship and support of community
43 51.81
Lack of professional support from external leadership
supervisor
49 59.04
As shown on Table 11 above the different challenges of leadership in enhancing employee’s

performance were rated by the employees. The main challenge is lack of experience to tackle
the problem (69.88%) followed by lack of training on the management (66.27%), lack of
effective leadership style (63.86%), insufficient staff and funds (61.45%) and lack of
professional support from external leadership supervisor (59.04%). The result clearly indicate
that lack of experience to tackle the problem, lack of training on the management and lack of
31
effective leadership style are the main challenges of identified in leadership to enhancing
employee’s performance in the Ethio Telecom at Dire Dawa Branch.
Interview result also indicate that some of the manager cannot fulfill the aspects of leadership
due to lack of experience, inability of convince the employee, poor communication and un
expected different ideas, immaturity behaviors and lack of responsibility for employee in all
occasions, and lack of great inspirations for loyalty from followers and no confidence to
employee of the department as well as employee. This implies transformational leaders are
working for securing their employees’ benefit package and facilitate promotion potentials to
ensure job satisfaction among their employees. As it is recalled from review of related
literatures transformational leaders are the one who always work for their employees’
satisfaction and always willing to support their subordinates.
32
CHAPTER FIVE
5. CONCLUSION AND RECOMMENDATION
5.1. Conclusion
The study was conducted to assess the role of leadership style on the employee’s performance
of Ethio Telecom at Dire Dawa Branch. From the findings it concludes that majority of
employees had sufficient educational background and not enough experience. The study
found that the employees understand that leadership played an important role in the
organization formulating aims and objectives, establishing structures, managing and
motivating personnel and providing leadership. This might indicate leadership style in the
organization is one of the factors that play significant role in enhancing the employee’s
performance.
The study concludes that democratic leadership style is highly used in Ethio Telecom at Dire
Dawa Branch. The study also confirmed that democratic leadership style play a great role on
the employee performance, manager friendly and approachable to fellow employees,
employees involved in performance appraisals and decision making, manager helps each
other’s to develop themselves, and manager gives personal attention to others who seems
rejected in the organization. Transformational and transactional leadership styles also played
a great role in enhancing employees’ performance. The leaders in Ethio Telecom at Dire
Dawa Branch understand and well know the concept of promotion procedures in order to
increase the employees’ performance. The availability of good communication between
leaders and employees would contribute employees’ performances.
The study found that authoritative leadership style really play minimum role on employee
performance. This study also found that leaders of Ethio Telecom at Dire Dawa Branch not
relying their own judgment when pass on performance requirement, organization performs
with no leadership barriers, and there is not leadership freedom in organization. Thus laissez-
faire style is associated with dissatisfaction, unmotivated and ineffectiveness and from this
study it is possible to say that laissez-faire style had low impact on employee performance.
The study concluded that employees expressed the desire to execute duties under the
democratic leadership style rather than the existing autocratic leadership styles. The aspects
of democratic leadership style are important for employee performance. Employees of Ethio
Telecom at Dire Dawa Branch, encourage others to think their way, they share their own
33
idea, there is no leadership freedom in their department and their managers rely on their own
judgment when passing performance requirement, performance of employees is not limited
by poor leadership of their manager, there is team work in their department, they are
motivated to work, their colleagues encourage them to perform well, their managers are not
team player, they have no good relationship with their managers.
The study also concludes that regardless of the leadership style, only few employees were
reflected as low performances in the Ethio Telecom at Dire Dawa Branch across all
performance items while about more than half of the employees were responded as they had
agreed and strongly agree. Nonetheless, from the result lack of experience to tackle the
problem, lack of training on the management and lack of effective leadership style are
influencing leadership to enhancing employee’s performance in the Ethio Telecom at Dire
Dawa Branch.
5.2. Recommendation
This study showed that the roles of leadership style on employee’s performance in Ethio
Telecom at Dire Dawa Branch and to enhancing leadership style and employee’s
performance the following are the recommendations for Ethio Telecom at Dire Dawa Branch
being made based on the findings from the study.
 The use of democratic leadership style in Ethio Telecom at Dire Dawa Branch would
further empower their employees by developing teams and according some measure
of power and authority to these teams.
 The organization should crate training program to minimize laissez-faire leadership
style and increase transformational leadership style and transactional leadership style.
 It is better to communicate their employees to practice the right leadership style which
is comfortable for their employees as well as the organization.
 It is also better to take training on leadership.
 They should minimize laissez-faire leadership form their management practice by
maximizing transformational leadership style and transactional leadership style in
their management practice because the result shown as laissez-faire leadership style
has negative impact on employee performance.
 Company should revise and re set its carrier structure of employees and leaders in
accordance with work experience, professional development of employees, to bring
quality of services and respect of professional employees.
34
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leadership on organizational performance in the service sector in Nigeria. Int’l Journal
of Economics, Commerce and Management, 4(12), 574-590.
Al-Safran, E. (2015). The effect of principal’s leadership style on school environment and
outcome.
Atieno, O. E. (2013). Influence of Principals’ Leadership Styles on Students’ Achievement in

Kenya Certificate of Secondary Education in Awendo District, Kenya.
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Public Elementary Schools In Jeddah, Kingdom of Saudi Arabia.
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performance in secondary schools in Awendo sub-county, Kenya.
Harris, A. and Muijs, D. (2005). Improve School through Teachers Leadership: Milton keyes:
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literature review. Public Policy and Administration Research.
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relationship between transformational leadership and service quality, International
Journal of Business and Management.
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Lussier, R.N. & Achua, C.F. (2013), Leadership: Theory, application, and skill development.
(4th ed.).Ohio: South-Western.
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Continuously Creating Opportunity in an Age of Uncertainty. Harvard Business
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Academy of Management Executive, 15: 81-94.
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36
APPENDIX
DIRE DAWA UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS
DEPARTMENT OF MANAGEMENT
Questionnaires to be filled by Employees of Ethio-Telecom in Dire Dawa Branch
Dear Respondent:
My name is Aisha Zuber. I am a graduate student in the Department of Management at Dire
Dawa University. The purpose of the questionnaire is to assess “The Effect of Leadership
Style on Employee Performance in Ethio-Telecom in Dire Dawa Branch”. The information
gathered through this questionnaire use by the researcher for strictly academic purpose.
Your careful and honest response determines the success of the researcher and the study.
Thus, you are kindly requested to complete the questioner carefully and honestly. Your
responses will be kept confidential. Please read the instructions and each in the
questionnaire carefully before you give your response. If you want to change any of your
response, make sure that you have cancelled the unwanted ones.
Thank you! For the time and effort, you have put in to your participation in this research.
Your input is greatly appreciated.
General Instructions:
 Put ’X’ mark in the space where alternative answers are given;
 No need have written your name;
 Please keep the paper clean;
Section 1: Personal Background Information
1. Sex: Male Female
2. Age: 18 - 25 26 – 40 41 – 55 Above 55
3. Educational Level: Diploma BA degree MA degree PhD
4. How long have you been working in current organization?
Less than 5 years
6-10 years
11- 15 years
16-20 Years
Above 20 year
37
Section 2: Leadership Style in Ethio-Telecom in Dire Dawa Branch
1. What is importance of leadership in Ethio-Telecom in Dire Dawa Branch?
Motivating Greeting confidence Providing guidance
2. How do you think the leadership style in Ethio-Telecom in Dire Dawa Branch?
Democratic
Authoritative
Transformational
Transactional
Laizzes fair
3. Indicate in the following table the level of importance of the criteria that you consider
important of leadership style on employees performance in the Ethio-Telecom in Dire
Dawa Branch. Please rate the extent to which these factors considered important by
putting a tick mark ("X") under: (4=strongly agree, 3= Agree 2= Disagree 1= strongly
disagree) based on their degree of importance.
Tick the right alternative that corresponds with your opinion genuinely:
NO STATEMENT 1 2 3 4
I DEMOCRATIC LEADERSHIP STYLE
1 My manager friendly and approachable to fellow employees
2 I am involved in performance appraisals to my department and decision
making
3 The manager helps others to develop themselves
4 The manager gives personal attention to others who seems rejected
II AUTHORITATIVE LEADERSHIP STYLE
1 My performance is limited by poor leadership from my supervisor
2 My performance is not limited by leadership
3 Leadership rules are designed by superiors
4 My performance is assessed by my supervisor alone
5 Performance requirements are designed according to the leader’s needs
III TRANSACTIONAL LEADERSHIP STYLE
1 My manager gives me reward or recognition when I reach the goal
2 My manager tells me what to do if I want recognition or reward from
work
38
3 My manager gives attention to what others can gate for what they
accomplish
IV TRANSFORMATIONAL LEADERSHIP STYLE
1 There is idealized and influential leadership in my organization
2 The leaderships are motivators of workers in my organization
3 Leaderships are given equal consideration in work place
4 Leaderships in my organization are good communicators with employees
V LAISSEZ-FAIRE LEADERSHIP STYLE
1 Leaderships encourage others to thinks their way
2 My manager relies on his/her own judgment when passing on
performance requirement
3 There is leadership freedom in my organization
4 My organization performs with no leadership barriers
Section 3: Roles of effective leadership style on employee’s performances in Ethio-

Telecom in Dire Dawa Branch
4. Please rate the extent to which these factors considered important by putting a tick
mark ("X") under: (4=strongly agree, 3= Agree 2= Disagree 1= strongly disagree)
based on their degree of importance.
N STATEMENT SA A N D SD
O
1 I have good relationship with my manager
2 I am motivated to work in my organization
3 I am motivated to creativity in my organization
4 My colleagues encourage me to perform
5 There is team work in my organization
6 My supervisor is a team player
7 I check my appraisal to meet my duties
8 My performance/appraisal is accessed daily by my leader
9 My performance is limited by poor leadership styles
10 I am comfortable with my leadership styles
39
Section 4: Challenges of leadership in enhancing employee’s performances
1. What challenges could encounter in leadership while enhancing employee’s
performances?
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
2. What do you suggest about the leadership style challenges and employees
performance in the Ethio-Telecom in Dire Dawa Branch?
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
3. What do you suggest about the leadership style challenges and employees
performance in the Ethio-Telecom in Dire Dawa Branch?
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
_____________________________________________________________________
40
INTERVIEW QUESTION
1. What type of leadership style/s is/are used at the Ethio-Telecom? Why? How?
2. What do you think is the relationship between your leadership style and
employee’s performances in the Ethio-Telecom at Dire Dawa Branch? How?
Why?
3. What leadership style is likely to produce the best committed employees in Ethio-
Telecom at Dire Dawa Branch?
4. What are leadership challenges in Ethio-Telecom in Dire Dawa Branch?
41

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ASSESSMENT ON THE ROLE OF LEADERSHIP STYLE ON

EMPLOYEE PERFORMANCE IN ETHIO-TELECOM: IN

A Research Submitted to the Department of Management in

By: Aisha Zuber

Dire Dawa University

Advisor: Behaylu Wondifraw

Dire Dawa, Ethiopia

1.1. Background of the Study.................................................................................................1

1.2. Statement of the Problem................................................................................................3

1.3. Research Questions.........................................................................................................4

1.4. Objective of the study.....................................................................................................4

1.4.1. General objective.....................................................................................................4

1.4.2. Specific objectives...................................................................................................4

1.5. Significance of the Study................................................................................................4

1.6. Scope of the Study..........................................................................................................5

1.7. Limitation of the study....................................................................................................5

1.8. Organization of the Paper................................................................................................5

1.9. Definitions of key terms..................................................................................................5

2. REVIEW OF RELATED LITERATURE.............................................................................6

2.1. Theoretical Review.........................................................................................................6

2.1.1. Concepts of Leadership............................................................................................6

2.1.3. Types of Leadership Styles......................................................................................9

2.1.4. Role of Leadership Style on Employee Performances...........................................12

2.2. Empirical Related Review.............................................................................................14

3. METHODOLOGY OF THE STUDY.................................................................................17

3.1. Description of the study area.........................................................................................17

3.2. Research Design............................................................................................................17

3.3. Research Approach.......................................................................................................17

3.4. Type and source of data................................................................................................18

3.5. Population of the study..................................................................................................18

3.6. Sample Size and Technique..........................................................................................18

3.7. Method of data collection..............................................................................................19

3.8. Method of data analysis................................................................................................19

3.9. Ethical Consideration....................................................................................................20

4. DATA ANALYSIS AND INTERPRETATION.................................................................21

4.1. Demographic Characteristics of the Respondents.........................................................21

4.2.1. Importance of Leadership in the Organization.......................................................22

4.2.2. Democratic Leadership Style.................................................................................24

4.2.4. Transactional Style Leadership Style.....................................................................26

4.2.5. Transformational Style Leadership Style...............................................................27

4.2.6. Laissez-faire Style Leadership Style......................................................................28

4.3. The Roles of Leadership Styles on Employee’s Performances....................................29

4.3.1. Descriptive Statistics on Employees Performances...............................................29

4.3.2. Leadership Style and Employees Performance......................................................30

4.4. The challenges of Leadership in enhancing Employee’s Performances.......................31

5. CONCLUSION AND RECOMMENDATION...................................................................33

Table 2: Importance of Leadership in the Organization..........................................................22

Table 3: Response on Leadership Style in Ethio Telecom at Dire Dawa Branch....................23

Table 4: Democratic Style in Ethio Telecom at Dire Dawa Branch........................................24

Table 5: Authoritative Style in Ethio Telecom at Dire Dawa Branch.....................................25

Table 6: Transactional Style in Ethio Telecom at Dire Dawa Branch.....................................26

Table 7: Transformational Style in Ethio Telecom at Dire Dawa Branch...............................27

Table 8: Laissez-faire lin Ethio Telecom at Dire Dawa Branch..............................................28

Table 9: Descriptive Statistics on Employees Performance....................................................29

Table 10: Leadership Style and Employees Performance........................................................30

Table 11: Challenges of leadership in enhancing employee’s performances..........................31

Bizhan (2015) defined leadership as a pattern of managerial behavior designed to integrate

Leadership is a critical management skill, involving the ability to encourage a group of

1.4.2. Specific objectives

1.5. Significance of the Study

1.7. Limitation of the study

1.8. Organization of the Paper

1.9. Definitions of key terms