directive leadership

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International Bulletin of Business Administration ISSN: 1451-243X Issue 9 (2010) © EuroJournals, Inc. 2010 http://www.eurojournals.com 31 The Effect of Directive and Participative Leadership Style on Employees’ Commitment to Service Quality H. Rezaei Dolatabadi Assistant professor of Marketing, University of Isfahan, Hezarjerib Street, Isfahan, Iran M. Safa M.A, Candidate, University of Isfahan E-mail: [email protected] Abstract The purpose of this study is investigation the Effect of directive and participative leadership styles on employees’ role clarity, shared customer oriented values and employees’ commitment to service quality (ECSQ) in banking industry in Iran. Data was collected from 87 Iranian banks and questionnaires distributed between managers and employees that have directly contact to customer. The survey asked managers about their leadership styles, while frontline employees were asked about their shared values, role clarity, and commitment to service quality. To analysis the data used, structural equation modeling (SEM). The results of the structural equations analysis showed that leadership style of manager can influence on employees’ responses. Directive leadership has negative effect on Shared values and ECSQ, and positive influence on employees’ role clarity. However, the results indicated that, participative leadership has directly influenced on Shared values and ECSQ but this leadership style did not influence on Employees’ role clarity. Also in this study direct, indirect, and total effects of variable have been perused too. This study demonstrates the importance effects of leadership styles of manager in service climate on employees’ responses. Keywords: Leadership styles, Employees’ Commitment to Service Quality, banking industry 1. Introduction The importance of frontline, customer-contact employees that directly related to customers and provided the service them, cannot be disregarded. High quality of frontline employees is integral to the excellence of firms because the service provided by such employees reflects the image of the organization and effects customer perceptions of service quality. Frontline employees are directly accountable for face-to-face customer service, service quality, and customer satisfaction—all of which are keys to strong performance (Hartline, Wooldridge, and Jones 2003). Most industry observers and practitioners agree that frontline employees who are satisfied with and committed to their jobs share the firm’s customer-oriented values, exhibit low levels of role stress, and deliver the highest level of service quality (Hartline, Maxham, and McKee 2000; Singh 2000). Leadership style, which refers to the way leaders behave towards or treat the individuals they are leading (Ehrhart, 2004), Drucker

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International Bulletin of Business Administration

ISSN: 1451-243X Issue 9 (2010)

© EuroJournals, Inc. 2010

http://www.eurojournals.com

31

The Effect of Directive and Participative Leadership Style on

Employees’ Commitment to Service Quality

H. Rezaei Dolatabadi

Assistant professor of Marketing, University of Isfahan, Hezarjerib Street, Isfahan, Iran

M. Safa

M.A, Candidate, University of Isfahan

E-mail: [email protected]

Abstract

The purpose of this study is investigation the Effect of directive and participative

leadership styles on employees’ role clarity, shared customer oriented values and

employees’ commitment to service quality (ECSQ) in banking industry in Iran. Data was

collected from 87 Iranian banks and questionnaires distributed between managers and

employees that have directly contact to customer. The survey asked managers about their

leadership styles, while frontline employees were asked about their shared values, role

clarity, and commitment to service quality. To analysis the data used, structural equation

modeling (SEM). The results of the structural equations analysis showed that leadership

style of manager can influence on employees’ responses. Directive leadership has negative

effect on Shared values and ECSQ, and positive influence on employees’ role clarity.

However, the results indicated that, participative leadership has directly influenced on

Shared values and ECSQ but this leadership style did not influence on Employees’ role

clarity. Also in this study direct, indirect, and total effects of variable have been perused

too. This study demonstrates the importance effects of leadership styles of manager in

service climate on employees’ responses.

Keywords: Leadership styles, Employees’ Commitment to Service Quality, banking

industry

1. Introduction The importance of frontline, customer-contact employees that directly related to customers and

provided the service them, cannot be disregarded. High quality of frontline employees is integral to the

excellence of firms because the service provided by such employees reflects the image of the

organization and effects customer perceptions of service quality. Frontline employees are directly

accountable for face-to-face customer service, service quality, and customer satisfaction—all of which

are keys to strong performance (Hartline, Wooldridge, and Jones 2003). Most industry observers and

practitioners agree that frontline employees who are satisfied with and committed to their jobs share

the firm’s customer-oriented values, exhibit low levels of role stress, and deliver the highest level of

service quality (Hartline, Maxham, and McKee 2000; Singh 2000). Leadership style, which refers to

the way leaders behave towards or treat the individuals they are leading (Ehrhart, 2004), Drucker

32

(1993) indicated that the quality and performance of managers are the key criteria in deciding

organizational success. An enterprise without a manager’s leadership is not able to transmute input

resources into competitive advantage. Therefore, it is clear that the leadership style of a manager has a

close relation to the development of organization. The study made by Bass (1990) shows that 45% to

65% of the total factors causing success or failure of organization are decided by leaders. Leadership

style has influence on employees’ behavior, including their adoption of the firm’s strategy and

organizational value and has been linked to both organizational outcomes and employee work

performance (Ehrhart, 2004). On the other hand managers can influence employees commitment to

service quality is to demonstrate it themselves (Babakus et al. 2003). This requires the manager to

adopt a leadership style that can influence his or her employees. While different leadership styles have

the ability to influence employees’ behavior in differing ways, manager must be attention to adopt of

the appropriate leadership style.

This research, investigates the extent to which two leadership styles (namely, directive,

participative,) influence frontline employees in bank industry, by examining how leadership style can

influences on employees’ commitment to service quality. Figure 1 presents the research model for this

study. The model was patterned after Clark et al.’s (2009) proposed model for Leadership’s Influence

on Employee Responses but was modified to accommodate leadership styles. The model suggests that

the employee commitment to service quality directly affected by leadership styles, moreover leadership

styles have an indirect affect on employee commitment to service via role clarity and shared customer

values.

Figure 1: Modified model of Leadership’s Influence on Employee Responses

Directive

Leadership

Shared

customer values

Role Clarity

Participative

Leadership

Employees’

Commitment to

service quality

Source: Clark et al (2009)

2. Literature Review and Research Hypotheses 2.1. Leadership Styles

2.1.1. Directive Leadership

Involves letting subordinates know exactly what is expected of them and giving specific directions.

Subordinates are expected to follow rules and regulations. (Mullins, 2005). Directive leadership has

been described as autocratic, task-oriented, and persuasive and manipulative (Bass 1981). Though it

can be effective in communicating a clear and concise vision of the organization’s strategic goals,

directive leadership is transformational only by coercion. Because of the authoritative nature of

directive leadership employees may be less likely to adopt management’s vision or values if they are

excluded from the decision-making process. Bass (1981) cited several studies that indicate that

directive leadership results in lower acceptance of managerial decisions than a more participative

33

leadership style. Employees’ failure to espouse management values may be a particular problem in

service organizations, since frontline employees are often required to make decisions and customize

service on the fly (Hartline, Maxham, and McKee 2000). Therefore:

2.1.2. Participative Leadership

Participative leadership Involves consulting with subordinates and the evaluation of their opinions and

suggestions before the manager makes the decision (Mullins, 2005). Participative leadership is

associated with consensus, consultation, delegation, and involvement (Bass 1981). Results revealed

that employees who perceive their managers as adopting consultative or participative leadership

behavior are more committed to their organizations, more satisfied with their jobs and higher in their

performance. (Yousef, 2000). Because of the consultative nature of participative leadership, it has the

potential to enhance the dissemination of organizational and managerial values to employees.

Employees who work for a participative leader tend to exhibit greater involvement, commitment, and

loyalty than employees who work under a directive leader (Bass 1981). Consequently employees who

are allowed to participate in the decision-making process are likely to be more committed to those

decisions. Since, frontline Employees in bank industry are often more cognizant of customer needs

than are managers, given the employees’ direct contact with customer. Therefore, management must be

allowed employees to participate in the decision-making process. Participative leadership’s ability to

raise the commitment, involvement, and loyalty among employees should be attractive to a manager

wishing to promulgate his or her commitment to service quality to employees.

2.2. Leadership Style and Employee Responses

Different leadership styles can have vastly different effects on the employees’ service related actions.

In this section, we discuss how leadership style influences shared customer oriented values, role

clarity, and employees’ commitment to service quality.

2.2.1. Shared Customer Oriented Values

Shared values represent the critical “glue” that holds organizational members together as they work

toward a common purpose (Hartline, Maxham, and McKee 2000). Like all beliefs, organizational

values have cognitive, affective and behavioral components which continually interact and are

exhibited in the actions and behaviors of the members of an organization (Rokeach, 1973). Every

profession and every organization is guided by a set of beliefs and values. It is these “organizational

values” that communicate what an organization believes and what it considers to be important (Hitt,

1988). Identifying organizational values is a critical step since such values influence directly how

people behave. In our study, we focus on the extent of shared customer-oriented values between the

organization and employees. Hutchinson and Purcell (2003), suggestions, managers need the support

of strong organizational values concerning leadership and people management.

In directive leadership style, The leader gives specific guidance of performance to subordinates

,telling followers what needs to be done and giving appropriate guidance along the way. Because of the

persuasive nature of directive leadership suffers the organizational shared values through the lack of

transformational properties limits its ability to influence shared values in a meaningful way (Gault

1994). Because directive leadership is not likely to create the necessary culture for shared values to

flourish. On the other hand research indicates that employees are less likely to adopt organizational or

managerial values when the employees are excluded from decision-making processes (Bass 1981).

Since this leadership style manager excluded employee from decision-making employees will be less

likely to accept organizational values and goals. Hence:

Hypothesis 1: directive leadership style is associated with shared customer-oriented values

between the bank and its frontline employees.

In contrast, in participative leadership leader consults with subordinates and considers their

suggestion and ideas when making decisions and taking particular actions. Through the consultative

34

process involved in a participative style, organizational values and employee values come into

alignment as employees recognize that the manager gives consideration to their ideas and opinions.

Because of the consultative nature of participative leadership likely that this process will greatly

enhance the degree of shared values between the bank and its employees. Hence:

Hypothesis 2: participative leadership style is associated with shared customer-oriented values

between the bank and its frontline employees.

2.2.2. Role clarity

Role clarity refers to the degree to which required information is provided about how the employee is

expected to perform his/her job (Teas et al, 1979). Role clarity is the extent to which an individual

receives and understands information required to do the job (Kelly and Hise, 1980). In managing

customer-contact employees, role clarity is a critical issue for managers, as it has been empirically

linked to employee performance and customers’ perceptions of service quality (Singh , 2000).

Employees who understand their role in organization can be better satisfied customer’ needs. Feedback

helps the frontline employees in learning about and clarifying their roles and hence has a significant

effect on the role clarity perceived by them (Evans et al., 2002). Therefore Directive leadership can be

effective in increasing role clarity because of the amount of feedback it generates (Muczyk and

Reimann 1987). Therefore, we expect that bank managers who employ a directive leadership style will

increase their employees’ role clarity:

Hypothesis 3: directive leadership style is associated with employee role clarity.

While participative leadership provides less explicit directives as to employees’ role

responsibilities, this type of management nonetheless significantly influences role clarity. A primary

difference between directive and participative leadership is the nature of communication between

managers and employees: directive leadership involves top-down communication, while participative

leadership allows employees to have input into and some control over their roles and responsibilities.

With a participative connection, employees can still gain feedback from their manager on role

expectations when needed (Clark et al, 2009). As a result, role clarity is likely to increase as

information and expectations about employees’ roles are managed by consensus (Bass 1981).

Therefore, we expect that a participative leadership style will have a positive influence on role clarity.

Hence:

Hypothesis 4: participative leadership style is associated with employee role clarity.

2.2.3. Employees’ commitment to service quality

Mowday et al (1979) defined organizational commitment as a strong belief in the organization’s goals

and values and a willingness to exert considerable effort on behalf of the organization. Employee

commitment reflects the employees' level of trust and belief in an organization’s purpose and value

system. Research has shown the stronger an employee can believe in the core values and direction of

an organization the higher the level of commitment (Porter et al, 1974). Mowday et al (1979) and

Meyer et al (1989) argue that individuals affectively committed to their organizations, (i.e. those who

identify with and involve themselves in an organization) perform at a higher level.

Previous research has devoted a great deal of attention to the relationship between leadership

behavior and organizational commitment. The findings in this area, however, are not entirely

consistent. Several studies found a positive relationship between the two variables (Alley and Gould,

1975; Porter et al., 1976.). Among the factors which contribute to a healthy organizational climate,

high morale and motivation, is the extent to which members of staff have a sense of commitment to the

organization. The extent of their commitment will have a major influence on the level of work

performance (Mullins, 2005). Employee who commitment to organization attempts to enhance their

skills and provides better services to customer (Schneider et al, 1998). Morris & Sherman (1981)

indicated that organizational commitment is able to effectively predict the employee’s performance and

turnover. Meyeret et al(1989) also found that organizational commitment was a proper indicator of

35

work performance. It is important for managers and leaders to pay more attention to the employee’s

organizational commitment.

In this study we considered commitment that employees have to service quality, therefore

Employee commitment to service quality (ECSQ) is a form of attitudinal commitment that can be

described as the strength of an individual’s dedication to providing quality service to an organization’s

customers (Ahmed and Parasuraman 1994). Although it is conceptually similar to organizational

commitment (Mowday, Steers, and Porter 1979), J. Morris and R.M. Steers (1980) have linked

leadership behavior to employees’ organizational commitment and found positive correlations between

high respect for leaders, high hierarchical structure level and organizational commitment.

Several studies indicate that participative leadership is more conducive to employee

commitment and loyalty than is directive leadership (Bass 1981). Due to its autocratic and

manipulative nature, directive leadership tends to focus on specific job tasks (Muczyk and Reimann

1987). In contrast, a participative leader invites the input of employees and strives for consensus (Bass

1981). Because participative leadership values the employee more than it does the task, such leadership

is likely to engender increased commitment among employees. As a result, the likelihood that frontline

employees will adopt the manager’s orientation to service quality increases. Hence:

Hypothesis 5: directive leadership style is associated with employee commitment to service

quality.

Hypothesis 6: participative leadership style is associated with employee commitment to service

quality.

2.3. Relationships between Employees Values and Actions

2.3.1. Shared Customer-oriented Values

When employees share the values of their organization, their job responses and behavior become more

consistent with those values. Shared values are among the most important components of any

organization’s culture (Deshpandé and Webster 1989). As such, shared values create a framework of

cultural norms and performance standards. That are sanctioned by the organization and embraced by its

employees. Employees working within this framework of shared values will better understand their

role in executing the firm’s customer-oriented mission (Hartline, Maxham, and McKee 2000). Thus,

when employee and organizational values are aligned, employees will experience greater clarity about

their role, their job, and how they contribute to the firm’s mission. A similar relationship also holds

true with respect to employee commitment. Employees who share the organization’s values tend to be

exhibit greater commitment at work (Hartline, Maxham, and McKee 2000). Furthermore, it is

reasonable to predict that when employees share the organization’s customer-oriented values, they are

more likely to exhibit commitment to serving customers well (Parasuraman, Zeithaml,and Berry 1985).

Hence:

Hypothesis 7: shared customer oriented values between the bank and their frontline employee

is associated with employee role clarity.

Hypothesis 8: shared customer oriented values between the bank and their frontline employee

is associated with employee commitment to service quality.

2.3.2. Role Clarity

Role clarity perceived by the frontline employees is not only desirable in terms of customer

satisfaction, but is also linked with employee’s job satisfaction, organizational commitment and

improved performance (de Ruyter et al., 2001). According to role theory, customer-contact employee

has a strong need for clarity on how they are expected to perform their jobs (Bush and Busch, 1981;

Teas et al., 1979). The relationship between role stress and employee commitment to service quality

has not been investigated empirically. However, research does indicate that organizational commitment

is affected negatively by role conflict and role ambiguity (Mathieu and Zajac 1990). A lack of role

clarity has a negative impact on job performance (Churchill et al, 1985). Considerable evidence

36

suggests that increased role ambiguity is associated with reduced job satisfaction and commitment

among frontline employees (Hartline and Ferrell 1996; Singh 2000). Hence, we hypothesize the

following:

Hypothesis 9: Employees’ role clarity is associated with employee commitment to service

quality.

3. Research Method 3.1. Sample

In this research for testing the hypotheses we collected the data from managers and frontline bank

employees in Iran. To collect the data for the study, 87 questionnaire Packets, each containing one

survey for the manager and four for employees that spent time directly dealing with customers for

transactions as well as responding to problems and complaints (frontline employees) consigned. The

survey asked managers about their leadership styles, while frontline employees were asked about their

shared customer values, role clarity and commitment to service quality. From a total of 348 employee

questionnaires distributed, 194 usable questionnaires were returned. The response rate was 55.74%.

Meanwhile, all 87 manager questionnaires were completed, and the response rate was 100%. The

demographic characteristics of employees and general managers are reported in Table1.

Table 1: Demographic Characteristics of Frontline Employees and Managers

Frontline Employees

n = 194

Managers

n = 87

Frequency Percentage Frequency Percentage

Gender

Male 124 62.9 85 97.7

Female 72 37.1 2 2.3

Age (years)

20-30 53 27.3 8 9.2

31-40 108 55.7 19 21.8

41-50 32 16.5 36 41.4

51-60 1 5 24 27.6

Education

Diploma 32 16.5 10 11.5

Senior High School 50 25.8 17 19.5

Bachelor 106 54.6 57 65.5

MA 6 3.1 3 3.5

Experience (years)

under 7 62 32 12 13.8

7–14 101 52.1 20 23

15–22 24 12.4 37 42.5

22–30 7 3.5 18 20.7

3.2. Measurement

Based on our review of the previous related literature, we constructed our survey instrument. We

utilized a multiple-item method; in which each item was measured on a five-point Likert scale from

strongly disagree to strongly agree. Prior to the data analysis, the measurement instruments were

evaluated for reliability. This was done to determine the degree to which the observed variables

measured the ‘‘true” value, and whether they were ‘‘error free.” Thus, the constructs were tested for

reliability, using Cronbach’s alpha test. Nunnally (1994) suggested that the score for each construct

should be greater than 0.6 to be considered reliable. As shown in Table 2, the Cronbach’s alpha

(reliability) for variable. Because the overall reliability of measurement was above 0.7, the

measurement instrument was shown to have a sufficient internal consistency. As a result, the data were

37

found to be appropriate for further analysis. In an effort to test for the convergent and discriminant

validity of the constructs, confirmatory factor analysis was employed. Factor analysis confirmed factor

loading in each variable to provide the appropriate factor to examine the research model. The

confirmatory factor analysis of the measurement model will categorize the appropriate factor variables

and will use them to analyze the results.

Conducting a Confirmatory Factor Analysis (CFA) of measurement model confirms the factor

structure of the measures as used. When the factors are appropriately identified and loaded, the

hypothesized structural model can be tested (Hair et al., 2003). Thus, the application of factor analysis

was deemed appropriate. According to Hair et al(2003), in order to determine the minimum loading

necessary to include an item in its respective construct, variables with loading greater than 0.3 were

considered significant; loading greater than 0.4, more important; and loadings of 0.5 or greater were

quite significant. Thus, this study accepts items with loading of 0.5 or greater. As shown in the Table2,

the internal consistency reliability (Cronbach’s alpha) of each measure is above the commonly

accepted threshold of .60. Also, the results of confirmatory factor analysis are shown in table 2. The

results indicated a reasonable fit of the six factor model to the employees data on the basis of a number

of fit statistics ( =193.66, df =186, root mean square error of approximation [RMSEA] =.015,

Goodness-of-Fit Index [GFI] = .91, Adjusted Goodness of Fit Index (AGFI) =.89, Normed Fit Index

[NFI] = .81, Comparative Fit Index [CFI] = .91. Meanwhile, Goodness of Fit Statistics for manager

data indicates: ( =67.91, df = 26, root mean square error of approximation [RMSEA] = .067,

Goodness-of-Fit Index [GFI] = .85, Adjusted Goodness of Fit Index (AGFI) =.74, Normed Fit Index

[NFI] =.88, Comparative Fit Index [CFI] =.90

Table 2: Result of confirmatory factor analysis and Cronbach’s alpha

Item Factor Loading t-value Cronbach’s alpha

Directive leadership 0.823

DL1 0.55 4.74

DL2 0.52 4.51

DL3 0.50 4.28

DL4 0.58 5.03

DL5 0.75 6.72

Participative leadership 0.786

PL1 0.52 4.31

PL2 0.64 5.32

PL3 0.56 4.60

PL4 0.64 5.38

Shared customer oriented values 0.89

SCV1 0.69 5.99

SCV2 0.75 6.40

SCV3 0.66 5.75

SCV4 0.54 4.71

SCV5 0.55 4.80

Role clarity 0.765

RC1 0.65 6.19

RC2 0.65 6.14

RC3 0.70 6.71

RC4 0.21 1.90

RC5 0.58 5.47

RC6 0.62 5.90

RC7 0. 60 5.64

RC8 0. 57 5.36

Employees’ commitment to service

Quality

0.856

ECSQ1 0.68 6.08

ECSQ2 0.54 4.84

ECSQ3 0.59 5.31

38

ECSQ4 0.61 5.42

ECSQ5 0.51 4.52

ECSQ6 0.55 4.95

ECSQ7 0.13 1.17

ECSQ8 0.51 4.51

3.3. Analysis

When the appropriate measurement model has been established, the next step is to test the full

structural model. Structural equation modeling is a tool for testing the causal relationships among the

latent variables, explaining the causal effects and assigning the explained and unexplained variance

(Joreskog & Sorbom, 2004). The relationships hypothesized in Figure 1 were tested using LISREL 8.8

to estimate completely standardized parameter estimates and t-values. The structural equation

modeling was utilized to determine the significant relationships among variable. The structural

equation modeling confirms this conceptual model perfectly because of causal relationships among

these variables. The results are summarized in Table 3. Model fit statistics in Table 4 collectively

indicate that the proposed model fits the data relatively well. Chi-Square= 2.17 and df=2 (p = .0324)

indicate that the fit for the model is acceptable. And model, shown in Exhibit 5

Table 3: Model Test Results

Hypothesis Path Parameter Estimate t-Value

H1 Directive leadership shared values -0.36 -6.87

H2 Participative leadership shared values 0.43 8.14

H3 Directive leadership role clarity 0.47 7.62

H4 Participative leadership role clarity -0.09 -1.41

H5 Directive leadership ECSQ -0.26 -5.73

H6 Participative leadership ECSQ 0.34 7.74

H7 shared values role clarity 0.43 6.32

H8 shared values ECSQ 0.36 7.35

H9 Role clarity ECSQ 0.30 6.99

Table 4: Goodness of Fit Statistics

Fitting indexes Appropriate criteria

RMR = root mean square error RMR < 0.05 0.025

GFI = Goodness-of-Fit Index GFI > 0.9 0.978

AGFI=adjusted goodness-of-fit index AGFI > 0.9 0.934

RMSEA = root mean square error of approximation RMSEA < 0.05 0.011

NFI = Normed Fit Index NFI > 0.9 0.984

CFI = Comparative Fit Index CFI > 0.9 0.97

IFI= Incremental fit index IFI > 0.9 0.97

4. Results This study examined the impact of directive and participative leadership style on employee’s

responses, including shared customer oriented values, role clarity and employees commitment to

service quality in Iranian banks. Results indicated that leadership styles can influence frontline

employee’s responses. The path diagram has been showed in figure 2 that indicated path coefficients

between variables. The findings indicated that directive leadership has negative impact on shared

customer oriented values and employees’ commitment to service quality. In other words due to

autocratic nature of directive leadership, this leadership style reduces the employees’ commitment to

service quality and shred values between bank and employees. Therefore the results proved hypotheses

H1 and H5. Moreover directive leadership significantly increases clarity of role between employees in

the environment of bank. Because of the authoritative nature of directive leadership, this leadership

39

style provides subordinates with an explicit understanding of their responsibilities and roles within the

organization (Hughes, Ginnett, and Curphy 1999). Therefore our findings proved hypotheses H3.

Hypotheses in our study are concerned with the direct effects of leadership styles on employees’

commitment to service quality. However, we were interested in total effects of these leadership styles

on employees’ attributes. Accordingly, we computed their direct, indirect, and total effects as shown in

table 5 we use these findings, as well as our hypothesis testing results, in drawing implications from

our study. In addition to direct effect of directive leadership on employees’ commitment to service

quality, this factor also has indirect impact on employees’ commitment to service quality via shared

customer oriented values and role clarity. The results indicated that total effect of this leadership style

on employee’s commitment is negative. Consequently, it can be stated that directive leadership

significantly diminishes employees’ commitment to service quality.

Participative leadership significantly impacts on employees’ commitment to service quality and

shared customer oriented values between employees and bank. These findings demonstrate that

employees who work in a participative bank environment are influenced by the firm’s culture and

values. The path coefficient between participative leadership and two variables (shared customer

oriented values and employees’ commitment to service quality) are strong and positive which indicates

that the use of participative leadership style by managers would cause the increase in employees’

commitment and shared values. Therefore, our findings proved hypotheses H2 and H6. Contrary to

hypothesis 4, participative leadership does not directly influence role clarity. Although this leadership

style has direct effect on employees’ commitment to service quality but it has indirect effect through

role clarity and shared values on employees’ commitment to service quality.

Shared values variable has a positive effect on role clarity and commitment to service quality,

supporting hypotheses 7 and 8. The path coefficient between shared values and role clarity is strong

and positive. In fact, the increase of shared values between banks and employees would raise the role

clarity. Also the path coefficient between shared values and commitment to service quality is positive.

This finding indicates the importance of aligning employee and organizational values in a bank setting.

Role clarity has a positive effect on employees’ commitment to service quality, supporting hypotheses

9.

Figure 2: Path Diagram of the Proposed Model

Directive

Leadership

Shared

customer values

Role Clarity

Participative

Leadership

Employees’

Commitment to

service quality

0.47

-0.36

-0.26

-0.09

0.34

0.43

0.43 0.36

0.30

40

Table 5: Direct, indirect, and total effects on Employee commitment to service quality

Employee commitment to service quality

direct effect indirect effects Total effect

Directive leadership -0.26 -0.035 -0.295

Participative leadership 0.40 0.183 0.583

Shared customer oriented values 0.36 0.129 0.489

5. Conclusion This study examined the effect of directive and participative leadership on employees’ actions in

Iranian bank. Our findings provided important foundations for understanding frontline employees’

responses to managers’ leadership styles in service organizational climate. The result of this study

indicates how different leadership styles can influence on employee’s performance in services systems.

The results indicated that directive leadership style has negative influences on employees’ commitment

to quality of offered services to customers. Therefore must be attention that managers who emphasize

for quality of their organization services, require to select their appropriate leadership style. Manager’s

leadership style creates culture in the organization that can influence on employees’ commitment to

service delivered. In addition, results show that participative leadership style has positive effect on

commitment, shared values and employee’s role clarity. Therefore, based on the results of this research

can be stated that participative leadership style appropriate for service organizations than directive

leadership.

Because of the autocratic nature of directive leadership excludes employees and limits their

autonomy and decisions was make without employee’s opinion therefore employees will be less likely

to accept organizational goals or strategies. Based on this reasoning can be stated that, directive

leadership style reduce shared customer oriented values commitment to service quality. In addition to

these direct effects of leadership styles on employee’s commitment to service, these two leadership

styles have indirect effects through two variables (role clarity and shared values on employee’s

commitment to service). This demonstrates the importance of these two important factors affecting

employee commitment is that managers need to pay attention to it.

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