Transformational leadership and customer service theory

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Transformational Leadership and Customer Service Theory
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Abstract
The business World has always been the most dynamic in terms of the events and activities that take place each day, each hour, each minute, each second and every single millisecond. It is such changes that some investors take advantage while some others are taken advantage by the changes. Leadership is thus a crucial part of the organization. Apart from meeting the organization’s mission, vision and objectives, leadership also plays an integral part in inventions, innovations, and implementation for change in the organization. With a leader expected to observe such disciplines, it would thus be necessary for them to be qualified to help achieve the objectives of the organization. The study will be conducted to determine the role of the transformational leader in the organization and how they can help implement the value of customer service in the organization to help achieve organizations objectives.

TABLE OF CONTENTS
Abstract iii
Chapter 1 1
1.0. Introduction 1
Chapter 2 3
2.0. Research methodology 3
2.1. Objectives 3
2.1.1. Genenral objectives 3
2.1.2. Specific objectives 3
2.2. Need for the study/ Research Gaps 3
2.3. Literature review 4
2.3.1. Steps in the Creation of Transformational Leadership Skills 5
2.3.2. Importance of Transformational Leadership 6
2.4. Statement of the problem 8
2.5. Research Design 9
2.6. Population 9
2.7. Sample size 9
2.8. Research Instruments 10
2.9. Hypothesis 10
Chapter 3 12
3.0. Tabulation and inferences 12
Chapter 4 19
Analysis 20
3.1. Conclusion 20
Chapter 5 21
4.0. Recommendations 22
4.1. Implications 23
4.2. Limitations of the study 23
References 23
APPENDIX I 25
APPENDIX II 27
CHAPTER 1
1.0. Introduction
In the recent years, transformational leadership has gained popularity by becoming one of the leading organizational sciences. The subsequent literature has developed since its inception at an exponential rate as it influences various aspects of leadership. Bernard Bass developed the concept of transformational leadership. Brown and Lam (2008) suggest that Bass introduced a concept that incorporates a relationship in which the stakeholders involved raise each other’s productivity concerning boosting morale and practicing morality. Bass also suggests that transformational leadership combines essential characteristics such as setting clear goals, encouraging others, setting goals and objectives, ensuring people aim beyond their self-interest, and supplementing inspiration. It is evident that transformational leadership has been a significant aspect of business administration. Given the benefits of transformational leadership in an organization, each leader should promote this kind of leadership to ensure job satisfaction, organizational commitment, and productivity among their followers.
Scholars and elites have argued that transformational leadership allows leaders to create an inspiring vision for the future of an organization (Bass, 1985). The leaders get to use this aspect of leadership in the mobilizing of employees by providing them with the necessary resources to achieve their full potential. According to Maslow’s hierarchy of needs, the self-actualization is the highest level of needs in humans (Jean, 2005). The same can be transformed into the employees in managing and understanding their needs. In addition to self-actualization goals, the employees also get a platform to increase their knowledge and expertise in various fields. As the leaders ensure the delivery of the vision in the workplace, they motivate and mobilize the team members. They also work towards building strong and trusted relationships with the corporate circle. The study of leadership aspects also incorporates the management of emotions. Followers should arguably amplify positive emotions in the workplace to ensure job satisfaction and effective social interaction that allows productivity in an organization. The management of emotions also creates a boundary platform in which employees and leaders can test better leadership skills (Brown and Lam, 2008). Leadership skills matched with perceived transformational leadership also supplements the existence of favorable customer evaluations (Boerner & Jobst, 2011). These assessments may be incorporated in aspects such as improvement of employee job satisfaction as well as service performance (Bass, 1985).
CHAPTER 2:
2.0. RESEARCH METHODOLOGY
2.1. Objectives
2.1.1. General objectives
The main objective of the study is to evaluate the efffects of transformational leadership on customer service
2.1.2. Specific objectives
i. To determine the effects of transformational leadership on performance
To assess how transformational leadership can imprvode customer service
To determine the effects of transformational leadership on an organization
2.2. Need for the study/ research Gaps
The study findings will be of great importance to the organization implementing the transformational leadership as it will help provide options to the organization on how the transformational leadership can be easily implemented into the organization to help improve on the performance and the level of customer service in the organization. The main research gap in the study is that will be limited to the responsiveness of organizations on performance. Information that will be gathered will only be from all selected sample units within the region. The study will be done to try and fill the gaps that exists in different organization that need to be filled on how transformational leadership can be used to improve the quality of customer service in the organization.

2.3. Literature Review
Transformational leadership is sometimes referred to as exchange leadership (Rudolph & Ken, 2002). As the name ‘transformation’ suggests, it is paramount that an exchange process will occur to the stakeholders involved. Since transformational leadership requires a particular kind of exchange, there must be a creation of a mutually beneficial relationship. Transformational leadership also defines the transformation that exists between the leaders and followers. Such a relationship may incorporate senior executives in an organization and the junior employees. This notion, therefore, suggests that the possible relationship between the parties involved has to be valuable, active, and mutual. The leader may also find compelling ways to award or punish behavior or particular activity in the organization. However, he or she should choose the method that will allow productivity and enhance cooperation (Chuang, Judge, and Liaw, 2012).
Even though some leaders may choose to focus on processes that exemplify gratifying practices, transformational leadership involves conducting practical errands and organization processes (Ahn, Adamson, & Dombusch, 2004). This leadership aspect was among the last classification of leadership to be developed in the process of explaining the leadership enigma. A leader has to interact with the followers on a constant basis to create trust and a mutual relationship. The actions of confidence in this type of leadership tend to supplement intrinsic and extrinsic motivation among the leaders and the followers. In the process, the leaders get to transmute their followers as they inspire their charismatic traits in them. In addition, the leaders can give the followers a sense of belonging and supplement effective communication in the organization (Chuang, Judge, and Liaw, 2012).
Applying principles of transformational leadership allows members to develop the quality and the process of production in an organization. The creation of an efficient environment to work on establishes beneficial relationship among the junior and senior employees (Brown and Lam, 2008). Quality and processes of the organization activities incorporate the essential aspects of service orientation and client approval. The process of incorporating these activities in the workplace allows various corporate levels of the organization to experience productivity. Furthermore, work is coordinated by the different levels of the organization and pro-social behaviors such as helping and salesperson performance are achieved.
2.3.1. Steps in the Creation of Transformational Leadership Skills
Transformational leadership skills are essential in supplementing the process of effective leadership in the organization. There are various steps involved in the creation of transformational leadership skills (Lembke, 2011). These steps are listed below.
Creating an inspiring vision. Every employee in the service industry may require a compelled reason on why to follow the laid out lead. The leaders, therefore, have a responsibility in the creation and communication of the organization’s mission and vision. Visions supplement the purpose of the organization and the reason for its inception. Correspondingly, channeling of the vision in the corporation allows the mobilization of resources that employees will utilize as they seek to serve clients effectively while ensuring productivity in the workplace. Luo and Bhattacharya (2006) also suggest that the leaders should align their personal goals with the visions of the organization to discourage conflict of interests.
Motivating people to deliver the vision. The mission statements developed by a transformational leadership platform need to inspire and create a positive impact anticipated by the customers and the employees. Effective transformational leaders are aware that significant operations tend to happen in an organization after encouraging their employees.
Ensure productivity through objectives and goal-oriented programs. The idea of project management requires transformational leaders to incorporate sensitive change management to deal with upcoming trends and changes in preference. Goal oriented programs allow effective communication among the various levels of an organization. Roles and responsibilities are clearly defined in this phase. An actual definition of these responsibilities allows the employees to achieve and measure their success (Luo and Bhattacharya, 2006). Furthermore, developing short-term goals may be essential for the employees to achieve quick success and get motivated.
Building strong relationships with clients based on trust and mutual understanding. Transformational leaders need to focus their attention on their juniors as they mobilize the necessary resources required to supplement the achievement of objectives. Moreover, a leader needs to understand the developmental needs of the clients and build trust among them. Transformational leadership tends to foster inspiration, loyalty, and trust among the customers and followers. These leaders, however, need to work on their leadership skills and ensure they allocate time for personal development (Bono, Foldes, Vinson, and Muros, 2007).
2.3.2. Importance of Transformational Leadership
The study of transformational leadership is critical in three important ways. The first aspect involves linking literature related to leadership with aspects such as service management as well as emotion regulation literature (Ahn, Adamson, & Dombusch, 2004). This attempt allows transformational leaders to understand customer reactions through the mediation process and activities carried out by the employee and emotion regulation program. Statistics conducted by various global corporations such as World Bank indicate that the global service sector constitutes up to 70% of the total Gross Domestic Product in the world (McColl-Kennedy and Anderson, 2002). These statistics have created a platform in which organizational scholars identify the self-efficacy resulting from this leadership and the productivity of various organizations.
The second attempt involves examination of necessary conditions that supplement the control platform. The interaction of this leadership orientation and negative affectivity leads to better outcomes and improved relationships between the clients and the organization (Pamela, 2012). The third attempt involves the linking of managers, customers, and employees. Their active interaction allows employees to develop innovative ideas as they perform activities that engender loyalty as well as identification of the leaders. Bono et al. (2007) validate that presenting an inspiring vision may be a result obtained from the proper definition of transformational leadership outcomes and moderation of growth in an organization.
Various scholars have suggested that management practices such as service climate, interdepartmental service, work facilitation, and HR practices have a profound impact on the commitments, self-efficacy, and performance of the organization (Brown and Trevino, 2006). These attributes tend to create a customer-oriented organizational behavior that affects the outcomes of the client. Efficient transformational leaders should inspire the followers to adopt the growth needs of other followers as it allows them to attain bounded effects. Well-established and defined theoretical models dealing with relationships and constructs of the transformational leadership platforms require constant analysis and revisions that will incorporate change. Other aspects that may be considered include the organization boundaries, substitutes for leadership tasks, and the levels of analysis that encourage moderation effects among the employees in the workplace (De Cremer, 2002).
Transformational leaders should pay attention to issues such as employee individual differences. Differences form the platform in which individuals can work to improve (De Cremer, 2002). These differences may come about in the employee affectivity and the cultural orientation of the followers. In most cases, leaders should coordinate the differences and treat them as a primary platform that may allow growth in the organization. Lack of organizing these differences may result in chaos and limited productivity among the employees. Individual differences play a significant role in ensuring the moderation of leadership processes. For example, charismatic and outgoing leaders sacrifice important aspects for the collective good of other members of an organization. It has also been established that the positive relationship that subsists between organizational identification and transformational leadership affects the affectivity of employees or followers. Positive and negative affectivity of the followers may require essential activities such as employee’s emotion management as well as employee disposition.
The process of integrating leadership activities with increased activities such as customer management, emotion regulation, as well as affectivity options determined the level of negative affectivity among the workers. Negative affectivity in turn defines the existence of positive emotions towards the intensification of employee job satisfaction and transformational leadership. Transactional theory gives a clear analysis of the transactional leadership involved in the corporate world (Brown and Lam, 2008).
2.4. Statement of the problem
Customer service is very important in determining the economic performance of organizations. They play a crucial role in economic development and their contribution to economic performance cannot be underestimated. They contribute to the creation of employment since a growing organization will most likely have to employ more individuals to work and serve the customers.
2.5. Research design
The research design explains the framework for conducting the entire research project. It gives specifications of the procedure required to obtain the information in order to solve the research problems (Gravetter & Forzano, 2011). There are two distinctive types of research design. They mainly include the explanatory and conclusive research designs. The explanatory research is ideal in exploring the problem situation by gaining numerous ideas and insights on the problem. On the other hand, a conclusive research helps in decision making through determination of the ultimate action in a particular situation (Gravetter & Forzano, 2011). The conclusive research design is further classified into casual and descriptive research design. In this study, a descriptive research design was adopted. A descriptive research design is suitable to the current study as it helps in answering the main research questions in the study. The design helped to describe the characteristics of the phenomenon being studied which is the transformation leaderships and its effects on the customer service
2.6. Population
A target population entails all variables or factors that the researcher intends to obtain information (Friedman, Furberg, & DeMets, 2010). The targeted population will be all business owners to determine how they have transformed the leadership strategies in the organization to promote customer service.
2.7. Sample size
Stratified sampling will be used for the study. The population will first be divided into strata based on business activities, where businesses will be randomly selected from the strata. A population of 100 businesses will be classified into different strata and a sample of 30 businesses will be used.
2.8. Research instruments
Structured Interviews will be used to collect primary data in the form of questionnaires. The interviews will be prepared in such a way that all variables to be evaluated in the study are captured. The interview will record correctly and accurately all information obtained from the businesses and property owners.
2.9. Hypotheses
Hypothesis 1
For negative affectivity to control the indirect effects of the leadership there has to be an amplification of pleasant emotions in the workplace that allows followers or employees to conduct their duties effectively. This hypothesis also suggests that service performance has a tendency of mediating customer outcomes, especially through job satisfaction. Service performance incorporates the additional role and prescribed role exhibited by clients. Prescribed role in behavior helps in determining the cooperative actions that ought to be directed to customers while additional role dictates job prescriptions of the employees.
Hypothesis 2
Service performance in the corporate world may mediate the primary relationship among customer actions such as customer intention to return, customer recommendation, as well as customer satisfaction. Transformational leadership may also lead to the existence of favorable customer evaluations as well as the employee emotion regulation.
Hypothesis 3
The supplementary relationship of transformational leadership and a factor such as an employee augmentation of positive emotions are directed to client outcomes in most cases. This relationship is also mediated by factors such as service performance and job satisfaction. Mediations among the leaders and the followers should occur when there is high negative affectivity as compared to low negative affectivity.

CHAPTER 3
3.0. Tabulation and inferences
TRANSFORMATIONAL LEADERSHIP AND AUTHIROTY TO MAKE FINAL DECISIONS

The first figure provides an overview of the authority of making the final decision by the transformational leader in the organization. 18 of the respondents agreed that the transformational leader should retain the authority to make the final decision in the organization while 38.7% of the respondents argue that the authority to make the final decision about the issues of the organization should not be the authority of the transformational leader.
EMPLOYEES INFLUENCE ON DECISIONMAKING PROCESS

In response to the second question in the questionnaire, the respondents were expected to provide their opinion on the employees influence on the decisions made by the transformational leader in the organization. 54% of the respondents were of the opinion that the employees should be role players in determining the decisions made by the transformational leader while the remaining 46% were of the opinion that the decisions made by the transformational leader in the team solely rests on the transformational leader.
EMPLOYEES VOTING TO HELP MAKE IMPORTANT DECISIONS

58% of the respondents to this question argued out that it is important for the employees to be made part of the decision making process. This is because they may provide some ideas that may be used to benefit the performance of the organization. 42% were however, of a different opinion since they argued out that it wasn’t necessary for the employees to be involved fully in the decision making process.

TRANSFORMATIONAL LEADERSHIP AND THE EXCHANGE OF TRUST AND LOYALTY FOR TANGIBLE REWARDS

84% of the respondents to this question provided that the transformational leaders should never accept tangible rewards in exchange for trust and loyalties while the remaining 16% were of the opinion that the transformational leader would exchange loyalties and trust for tangible rewards

TRANSFORMATIONAL LEADERS EITHER ACTING IN ACTIVE CAPACITIES DRIVEN BY VISIONS AND GOALS OR CONDUCTING THEIR ASSIGNMENTS IN PASSIVE CAPACITIES WITH NO DRIVERS

85.7% of the respondents provided that the transformational leaders should be actively involved in providing capacity driven visions and goals that allow for customer service to be achieved by the remaining 14.3% argued that the transformational leaders may choose to be passive but provide guidelines to help achieve the objectives of the organization.

5-POINT LIKER SCALE FOR TRANSFORMATIONAL LEADERSHIP

In as much as transformational leadership entail supervision for performance to be achieved in the organization, the results from the study have shown that the employees rarely like full supervision to be imposed on them. Most employees would rather have indirect supervision while conducting their duties.
TRANSFORMATIONAL LEADERSHIP APPLICABILITY IN AREAS WHERE THE PRACTICE OF RIGID PROCEDURES IS PARAMOUNT SUCH AS LOW-SKILLED OCCUPATIONS

76% of the respondents have identified that the transformational leadership is applicable to rigid areas such as those with low- skilled occupations. The transformational leadership usually entails the provision of supervision activities on the employees and thus it can be easily adopted in rigid situations too.

CHAPTER 4
4.0. Analysis
The chapter provides for discussion of the key findings from the research and draw up some conclusions from the findings of the study. The study was done for a sample of 30 respondents of which all the respondents filled the questionnaires.
The transactional leadership mainly focuses on the supervision and performance of an organization. The transactional form of leadership acts as an encouragement to the followers of the leaders in the organization who are in most cases the employees. The company usually achieves this through rewards and punishments that are given to them through bonuses where the employees are exceptionally good in their work and punish those whose work is faulty through probations. The study sought to identify how transformational leadership should be implemented in an organization by the transformation leader and the value of the customer service to the organization. The main findings in this study are that the employees are the most important people in determining the success of the transformational leader in the organization. The most important thing used to determine the success of a project is the employees as identified by the study results. They interact directly with the consumers of the product and thus understand the demands better. Considering them would help increase the performance of the organization. they employees can be involved in the decision making process by being allowed to vote on important issues and having their opinions listened.
In considering the value of the customer service, the questionnaire used the questions of active participation, the 5-point liker scale of the direct supervision and the application of transformational leadership in determining how customer service can achieve value for the organization. The transformational leader needs to understand the means through which he can understand the value of customer service by identifying means through which he can actively act in capacity driven visions aimed at improving the customer service. In as much as supervision is also important in the organization, the employees usually don’t like direct supervision as it may end up reducing the quality of customer service. The direct supervision should be kept at its minimal.
4.1. Conclusion
Transformational leadership is arguably more effective than other leadership platforms in areas that involve social interaction such as customer service. Unlike transformational leadership, other leaderships do not focus on the development of employee emotions that may contribute as a solemn factor in the service industry. In most cases, employees need to develop positive emotions towards the organization and their operations as negative and unpleasant emotions may drive the clients away. Transformational leaders tend to focus their efforts on aspects such as formal exchange relationships among others. The promotion of positive feelings is, therefore, necessary as the employees get the platform to treat the clients well and supplement the creation of mutual and effective relationships. As organizations enter into the corporate world and expand their activities, they should shift their attention from the actual outcomes of operations such as increasing sales, profits, or the market share.
CHAPTER 5:
5.0. Recommendations
Each organization has its goals, visions and plans which it hopes to achieve in a given time frame. Leadership is particularly a very vital requirement in order for an organization to achieve its set targets. Good leaders in an organization should promote the adoption and implementation of change and innovation. It is for this reason that Academic Conferences and Publishing Limited (2013) identify two types of leaders. In most organizations, there are leaders that are averse to change and do not support any form of innovation, and there are those who seek the smallest opportunity to adopt changes and innovation in the organization. The risk-averse leaders in an organization are mostly shareholders who run the businesses during the innovative, and change implementing leaders are majorly the directors who act as agents of the shareholders. In most cases, directors are often referred to as the change agents (Simon, 2007, p. 1).
Findings show that the transformational leader in an organization requires others to cooperate for success to be easily achieved. Without the cooperation of others, it is not possible to adopt the transformational leadership and effectively achieve the objectives of the organization. The employees and the other individuals who are involved in the projects should be consulted and made part of the decisions making process while undertaking the projects to enhance full success. Without their inclusion in the decision making process, they may not provide their opinion on important matters concerning the employees thus it may not be possible to understand the requirements of the employees. Since the employees interact directly with the customers, they understand better the requirements of the employees and the inclusion in decision making by the transformational leader will encourage improved performance.
Consumer service means providing products and services that are appealing to the consumers and through enhanced value creation. The research has shown that the transformational leaders cannot work alone. Real data shows that important decisions in the organizations that need to be made required that the transformational leaders consult with the employees since they are the ones who usually interact directly with the customers and understand their needs better.
5.1. Implications
The study findings will be of importance to the policy makers and enterprenuers in the bsuniess world as they will understand the significance of transformational leadership and customer service in making important decisions about their organizations. Similarly, there already exists a wide body of knowledge on leadership ad customer service, but they have not provided on the significance of adopting the transformation leaderships and the value that is provided by focussing on customer service in improving the performance of the organization. The study will be expected to provide an extra body of knowledge to the limited literatures that exists on the issue.
5.2. Limitations to the study
The information gathered will be from a small selected sample unit and may thus not be fully used to make collective decisions on the transformation leadership affecting customer service. The sample size is limited to 30 respondents and this is a very small sample to rely on to make important decisions about the type of leadership that other organizations should adopt.
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APPENDIX 1
Questionnaire
The following questions may help in devising better ways to improve the process of transformational leadership and the effects it has on customer satisfaction, service performance, as well as the follower and corporate goals.
1. As a transformational leader should I retain the authority to make the final decision?
(a) No ?
(b) Yes ?
2. Should the employees in my team determine the decisions that i make
(a) No ?
(b) Yes ?
3. When major decisions need to be made, are the employees in the team supposed to vote
(a) No ?
(b) Yes ?
4. Does a transformational leader require the exchange of trust and loyalty for tangible rewards?
(a) No ?
(b) Yes ?
5. Should transformational leaders act in active capacities driven by visions and goals or can they conduct their assignments in passive capacities with no drivers?
(a) Active ?
(b) Passive ?
6. On a 5-point Liker scale, how would you rate the direct supervisor’s leadership? Would it be at extremes 1 (not at all), 2, 3, or 4 (intermediate) or 5 (always)?
(a) 1 ?
(b) 2 ?
(a) 3 ?
(b) 4 ?
(a) 5 ?
7. Is transformational leadership applicable in areas where the practice of rigid procedures is paramount such as low-skilled occupations
(a) No ?
(b) Yes ?
APPENDIX II
SURVEY RESPONSE