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The study was intended to examine the impact of the leadership styles on organisation performance, specifically in microfinance institutions. Three specific objectives guided the study; to determine the leadership style that is mainly used in a microfinance institution, to assess the factors contributing to the adoption of particular leadership styles and to identify the extent to which leadership styles acquired by the managers of microfinance institution impact organisation performance.
The study was a qualitative research which employed descriptive survey design whereby the employees from three microfinance institutions, that is, Yetu, Finca and Equity were selected for the study. Primary data was collected through group discussions and interviews while the secondary data was collected through reviewing archival records such as Journals, textbooks, newspapers and dissertations. Study population was 345 while the sample size was 51 respondents. Stratified and purposive sampling techniques were used for obtaining the sample size. Data was analysed using content analysis approach.
The findings revealed that Managers in microfinance institutions employed autocratic leadership styles more than any other styles of leadership whereby employees were not allowed to make any decision concerning the institutions development. Concerning the factors contributing to adoption of autocratic leadership styles the findings revealed that it was adopted in order to control employees who were very crucial in the operations of institutional tasks. Also, the findings revealed that the performance of Microfinance institutions depends mostly on the performance of employees which is highly affected by the leadership styles practiced in the institutions.
Leaders should consider formulating and implementing effective rewards and recognition systems. Also, managerial policies formulated should call for greater involvement in guiding subordinates to achieve organisational goals. |
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