Academic journal article International Journal of Business

Emotional Intelligence: Does Leadership Style Matter? Employees Perception in Ghana's Banking Sector

Academic journal article International Journal of Business

Emotional Intelligence: Does Leadership Style Matter? Employees Perception in Ghana's Banking Sector

Article excerpt

ABSTRACT

The purpose of this study was to determine whether employees in Ghana's banking sector perceive their leaders to be emotionally intelligent based on their style of leadership. The study was cross-sectional in nature and made use of structured questionnaires to collect quantitative data. Out of 300 questionnaires administered, 234 were returned (comprising of 115 males and 119 females). The findings of the study revealed that a positive relationship exists between transformational leadership and emotional intelligence (EI) whereas a negative relationship was found between transactional leadership and EI of leaders. The study also noted that transformational leaders are more emotionally intelligent; thus, it is recommended that EI an attribute associated with leader effectiveness be made part of leadership development in organizations.

JEL Classification: M12

Keywords: transformational leadership; transactional leadership; emotional intelligence; Ghana

I. INTRODUCTION

The banking sector has generally been described as a kind of work environment where employees are often busy, work under pressure and are constantly in an emotionally laborious state (Rizwan et al., 2014). This is attributable to the demand of work, prudency in financial management and extended time of interaction between employees of banks and customers directly on daily basis. As such, many banking institutions are seeking strategic means to create conducive work environments for their employees where work is less stressful and productivity as well as staff motivation is high. Scholars such as Kessler et al. (2013) have advanced that to achieve this, leadership is the best place to begin.

According to Bar-on (1996), one important characteristic that is common in the operation of all leadership styles is their emotional prowess--measured as Emotional Intelligence (EI). EI is the leaders' ability to "....perceive accurately, appraise, and express emotion; the ability to access and/or generate feelings when they facilitate thought; the ability to understand emotion and emotional knowledge; and the ability to regulate emotions to promote emotional and intellectual growth" (Salovey and Mayer, 1990, p. 10). The concept of EI is important because the expression of emotions in the workplace, either negative or positive, cannot be wished away but must rather be managed effectively (Ashforth and Humphrey, 1995).

Additionally, EI is the skill that determines whether a leader will be successful or not in dealing with followers (Goleman, 1998; Sosik and Megerian, 1999). It has also been proven that EI contributes about 80 to 90 % to leadership competence (Goleman, 1998). EI is sometimes more of the qualities that separate outstanding leaders from average ones (Goleman, 1998). Extant research also revealed that EI influences various employee outcomes: employee commitment (Tung, Khuong, and Phuong, 2014), employee performance (Jorfi, Jorfi and Moghadam, 2010), occupational stress (Gardner and Stough, 2003), employee turnover (Siddiqui and Hassan, 2013) among others.

Thus, when employees perceive that leaders understand their needs, they tend to give off the best of their skills to the execution of organizational goals (Korkmaz and Arpaci, 2009) and the opposite is true when they perceive they are not handled in an emotionally intelligent manner (Ayoko, Callan and Hartel, 2003). Hence, the need for organizations to be interested in the EI of their leaders since it has the propensity to induce favorable behaviors from employees. More so, amongst the numerous leadership styles identified in literature (e.g., charismatic, ethical, servant, adaptive, dispersed, authentic, spiritual, transcendent, transformational, transactional, laissez-faire leadership styles among others), the ones that have been mostly identified to be used in organizations especially to influence employees' behavior are the transformational and transactional styles of leadership. …

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