Tech J Engin & App Sci., 3 (S): , 2013

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1 Technical Journal of Engineering and Applied Sciences Available online at TJEAS Journal S/ ISSN TJEAS Relationship between Transformational Leadership and (Case Study: Social Security office of Kermanshah) Bahman Saeidipour 1, Hassan Rangriz 2, Jila Torabi 3 1. Professor of Educational Sciences of Payame Noor University, I. R. of Iran 2. Assistant Professor, Faculty of Management, University of Economical Sciences, Tehran, Iran 3. M.A.Student of MBA, Science and Research Branch, Islamic Azad University, Kermanshah, Iran Corresponding author jila.torabi@yahoo.com ABSTRACT: This study aims to study the relationship between transformational leadership and innovation in social security office in the city of Kermanshah. This study has been done based on descriptive correlation method. Subject group includes 1000 staff that has been randomly sampled between 238 staff. To evaluate transformational leadership and innovation, standard questionnaires of Bass & Avolio; and Dorabjee have been applied in sequence. To data analysis, Pearson s correlational coefficient and variance analysis are applied. The results show that there is a meaningful and positive relationship between components of transformational leadership intellectual simulation, idealized influence, inspirational motivation, individualized considerations - and the of innovation. The most correlation belongs to individualized considerations (0.673) while the least one stands for inspirational motivation (0.584). Also there is a positive and meaningful relationship between innovation and learning in upper levels of learning and lower levels in a way that it tends to be more positive for upper levels. KeyWords: Transformational Leadership,, intellectual simulation, idealized influence, inspirational motivation, individualized considerations. INTRODUCTION Changes in socio economical patterns in existing world have their root in science and technology developments. Any organization encounters global risks and challenges, so all of them have to take measures to meet nowadays needs; including creativity, new products and services and new policies (Ahmadpourdariani, 2002). is a basic need for all organizations to survive in and get adapted to such a changing environment as well as to keep ruination away. All managers will touch this saying: Ruination is waiting for you, unless you are innovative. Old policies do not work, and the situation has got so complicated that no organization can survive without innovation (Mirkamali & Choupani, 2011). increases the advantage of competitiveness that itself is looked at as one the most important strategies for long term success, also, it influences risk factors (Tajeddini, 2010). Organizational innovation is delivering useable and valuable products, services (Johannessen, 2008). In other words, organizational innovation is a key factor to survive in competitive environments (Lemon & Sahota, 2004). On the hand, today s organizations need managers who challenge old and routin ways of doing things. They would not accept monotony (Mohamadkazemi, 2012). has stayed in a unique position socially, personally, and organizationally. Today innovative managers and staff are more needed than the past, those who enjoy innovative thinking and able to achieve their organizations goals. Nowadays, to meet the competitiveness of the market it is not enough to control expenditures and quality of the products, because from now on ability and agility in innovation are key factors for organizations to survive (Steiner, 2007). Regarding the fact that employee s innovation power influences organization s performance, many researches have focused on the point. Leadership is one of the components that have been focused on. It is one of the key elements in organizational transformation while some studies show that it is the most important and influential one. If theoretically innovation depends on leadership, this question will raise that what leadership style will practically be applicable and effective to achieve change? Many studies show that when changes are needed a transformational leadership style has been more

2 successful. Transformational leaders are believed in internal changes in their organization and staff to manage staff s interests along with organizational goal and enhance staff s commitment (Jalilian et al, 2010). Then, innovation seems so important in today s organizations, and leadership style as an influential factor will be important. But still researches for the case are not enough. So, this study aims to find the relationship between transformational leadership and innovation? Theoretical Bases Leadership There are different opinions about it. Some believe that it is a part of manager s task, while some others think that its concept is more inclusive than management. On the other hand, some believe that leadership includes any attempt that influences and encourages others to achieve a specific and common goal enthusiastically, in other words; leadership means influencing others to achieve a common goal (Rezaeean, 2009). Leadership theories have varied since They have had the following trend Trail Theories. Behavioral theories. Situational Theories. Transformational theory ( HosseiniSarkhosh, 2010) Transformational Leadership Theory Its paradigm is rooted in 16 th century, when Machiavelli was responsible to do the researches for monarchy system. He studied the traits and behaviors of leaders to develop his theory within the aristocratic society of England. He believed that leadership is conducting others leadership potentials to achieve superior goals. In the beginning of 19 th century, Veber gave a similar definition to that of Machiavelli. He said that leadership is the source of influence on others. He stressed charisma as an important trait for leaders. Charisma is defined as a divine talent with a kind of power that absorbs others loyalty and trust. It exactly depends on the kind of stimulation and insight that evolves in the followers. Charisma is a key element of transformational leadership. Other theory givers like House & Bass have defined charisma as basic element for transformational leadership (Aghaz, 2005). Transformational and Interactional leadership has its origin in Burns works. He used the term of transformational leadership as a political term (1978), but Bass (1985) introduced the term to organizational leadership. He knows a transformational manager as one who encourages his followers to go beyond what they are expected to do (Hosseini & et al, 2010). This kind of leadership occurs when leaders are successful to boost the insight and acceptance of the missions in their followers (Krishnan, 2004). They should encourage the followers to let their personal interests in compliance with team goals (Riaz& et al, 2011). Also, leaders and followers should have a mutual impact on each other to elevate both sides' level of motivation and ethics (Givens, 2008). The most important characteristic of transformational leadership is to encourage followers to exceed their expected commitments (Modassir & Shingh, 2008). The components of Transformational Leadership According to Bass & Avolio (1995) theory, transformational leadership involves four components: Idealized influence, inspirational motivation, intellectual simulation, and individualized consideration. For idealized influence, leaders stress on the importance of the goals, enthusiasm, interest and commitment to the common goals (Riaz et al, 2011). For inspirational motivation, leaders focus on challenging follower's beliefs and restructuring their belief maps to look at the old affairs in a new way. Intellectual simulation is concerned with creating a new view point and / or achieving a challenging goal (Modassir & Singh, 2008).For individualized concerns, leaders regard person to person relationship and try to meet individuals needs and find their competences and abilities ( Gumusluouglu & Alsev, 2009). Definition There are different definitions for innovation, Webster dictionary has defined it as the ability of doing something creative resulting in delivering a new product or service. This ability may be innate or gained through training (Fathizadeh et al, 2011). Zott (2003) believes that innovation includes creating new products or procedures. is to put creative ideas in practice in a scientific way. It origins fron creativity. Indeed, innovation is to changing creative and new ideas into practice. Most innovations are achieved through target wised seeking for new opportunities. This will be possible with the analysis of these opportunities (Kuratko & Hodgetts, 2001). has stayed in a unique position socially, personally, and organizationally. Today innovative managers and staff are more needed than the past, those who enjoy innovative thinking and able to achieve their 3771

3 organizations goals (Steiner, 2007). Organizational innovation is creating or delivering new services or products (Johannessen, 2008). In other words, is a key to exist and keep alive in a competitive environment (Lemon & Sahota, 2004). Joseph Schumpeter has defined innovation as Creating a new business with one of the following items: new materials or devices, creating new procedures, opening new markets, and applying new organizational charts( Aghadavoud et al,2010).. Literature of the Study Jalilian and his colleagues (2010 ) in a study entitled Transformational Leadership and in Employees as well as studying transformational leadership and its relationship with innovation found some interfering parameters affecting this relationship. They found that the leadership style pave the way toward innovation in employees and organization. Leaders with some measures can increase their staff s innovation capacities like boosting motivation, stimulating intellectually, elevating psychological competencies, supporting creative ideas, giving insight, creating an atmosphere of freedom andchallenging the situation. The most important middling or interfering factors are: business challenges, manager s support, manager s charisma, and the atmosphere of freedom. Mirkamali & Choupani ( 2011 ) in a study The Relationship Between transformational Leadership and Organizational done in an insurance company, showed that there is a positive and meaningful relationship between transformational leadership and all parameters of innovation.they have considered three parameters of transformational leadership namely intellectual simulation, inspirational motivation, and idealized influence as predictable s and with a regression equation, they have shown a tendency toward innovation. Gumusluoglu & Ilsev (2006) studied transformational leadership with innovation regarding the effects of internal and external supports. Subject group of this study are staff and managers of some small software companies. This study also confirms the positive relationship between transformational leadership and innovation. What seems special about this study is that it has been done in small companies and also it has considered external supports. Zagoresek and his colleagues (2009) have studied the impacts of transactional and transformational leadership on organizational learning. They have shown that transformational leadership has more powerful positive impacts on organizational learning than transactional one. Transformational leadership has influenced all four components of organizational learning positively. Karakitapoglu & Gumusluoglu (2012) in a study called The Bright and Dark Sides of Transformational leadership have observed the negative and positive behaviors of transformational and transactional managers. They believe that there are four kinds of transformational leadership: 1. benevolent paternalism 2. Implementation of the vision 3.Employee participation and teamwork 4.Proactive behavior. Among this group benevolent paternalism has been considered more than three others. Transformational leadership Idealized influence Individualized consideration Inspirational motivation Intellectual simulation Figure 1. Conceptual model of the research Primary Hypothesis There is a meaningful relationship between transformational leadership and innovation. 3772

4 Secondary Hypothesis There is a meaningful relationship between and idealized influence. There is a meaningful relationship between and intellectual simulation. There is a meaningful relationship between and inspirational motivation. There is a meaningful relationship between and individualized considerations. MATERIALS AND METHODS This is an applied study because it scrutinizes the relationship between transformational leadership with organizational learning. Its result may be helpful for organizations to apply it in their system to improve it. Methodologically it is a descriptive research and a correlational one because the relations of transformational leadership with innovation have been analyzed as the base for the study. Due to the characteristics of the data the scale type is ranked and distribution is normal, so Pearson s correlation coefficient has been adopted. Questionnaires have been applied for data gathering. Subject group has been chosen with simple random sampling. Subject group of this study are the managers and staff of social security office in the city of Kermanshah including 238 people. Morgan table has been used to select sample society. To measure transformational leadership Bass &Avolio questionnaire has been used. It covers four components with five questions for each component including total 20 questions. To measure innovation, Dorabji questionnaire (1998) has been used it includes seven components with total 37 questions. To measure organizational learning. To make sure of validity, content validity and face validity have been seen and the questionnaire was approved by ten university professors. To measure reliability of transformational leadership Cronbach s Alfa coefficient has been applied. The result of 97% shows a high level of reliability. Table1. Transformational leadership questionnaire reliability Idealized influence Inspirational motivation Individualized consideration Intellectual simulation Total reliability The reliability of innovation questionnaire has been measure by means of Cronbach Alfa the result is 93%. Table2. Reliability of innovation questionnaire Challenge Freedom Trust Idea time Friendliness Negotiation Risk taking Total reliability RESULTS AND DISCUSSION Data analysis was done based on 238 questionnaires completed by participants, among whom 16/7% held high school diploma or lower degrees, 19/6% associate degrees, 58/9% bachelor degrees, and 4/8 master or higher degrees. Table3. Correlation matrix between components of transformational leadership and innovation Individualized consideration Inspirational motivation Idealized influence Intellectual simulation Transformational leadership Correlation coefficient innovation Challenge Freedom Trust Idea time Friendliness Negotiation Risk taking 3773

5 This table shows a positive and meaningful relationship between transformational leadership and innovation (R= 0/692). The more powerful is the leadership, the more increases the innovation. The most correlation is for individualized consideration (0/673) and the less one is for inspirational motivation (0/584). Pearson coefficient and variance analysis (F test) have been applied to analyze the data. Relation coefficient shows the possibility of relationship by measuring the extent of dependency of dependent to independent. So, it is possible to see a linear relationship between dependent and independent. If a meaningful relationship has a relation coefficient higher than the normal flow (for this study, it is 5%), that relationship will be accepted as none (0); otherwise, that relationship will be accepted (H 1 ). Variance analysis (F test) has been used to analyze the data.if the meaningfulness level is higher than the normal flow (for this study is 5%), that will be accepted as none (0); otherwise, that will be acceptable. As it is shown in table 4, the meaningfulness level of relation coefficient and F test is lower than flow rate. It proves the primary hypothesis. Table4. The summary of linear relationship between transformational leadership and innovation Meaningfulness level of ( R 2 ) Meaningfulness relation coefficient coefficient level of F test Transformational leadership Pearson relation coefficient (R 2) F in the test H 1 is As it is shown in table 5, the meaningfulness level of relation coefficient and F test is lower than flow rate. It proves the primary hypothesis. Table5. The summary of linear relationship between intellectual simulation and innovation Pearson Meaningfulness ( R 2 ) F in the Meaningfulness relation level of relation coefficient test level of F test coefficient coefficient (R) intellectual simulation H 1 is As it is shown in table 6, the meaningfulness level of relation coefficient and F test is lower than flow rate. It shows that the second secondary hypothesis is acceptable and there is a meaningful relationship between and idealized influence. Idealized influence Table 6. The summary of linear relationship between influence and innovation Pearson relation Meaningfulness (R 2 ) F in the test coefficient (R) level of relation coefficient Meaningfulness level of F test coefficient H 1 is As it is shown in table 7, the meaningfulness level of relation coefficient and F test is lower than flow rate. It shows that the third secondary hypothesis is acceptable and there is a meaningful relationship between and inspirational motivation. Table7. The summary of linear relationship between inspirational motivation and innovation Pearson Meaningfulness ( R 2 ) F in the Meaningfulness relation level of relation coefficient test level of F test coefficient coefficient (R) inspirational motivation H 1 is As it is shown in table 8, the meaningfulness level of relation coefficient and F test is lower than flow rate. It shows that the forth secondary hypothesis is acceptable and there is a meaningful relationship between and individual concerns. 3774

6 Table8. The summary of linear relationship between inspirational individual concerns Pearson Meaningfulness ( R 2 ) F in the Meaningfulness relation level of relation coefficient test level of F test coefficient (R) coefficient individual concerns H 1 is To measure the level of influence of transformational leadership components and innovation, Friedman ranking test is used. As it has been shown in table 9, among the components of transformational leadership; idealized influence has the most and intellectual simulation has the least influence. Table9. of Friedman ranking test for transformational leadership Transformational leadership components Ranking average Idealized influence 3.97 Inspirational motivation 2.32 Individualized consideration 1.87 Intellectual simulation 1.84 Also table 10 shows that among innovation components, challenge has the most and trust has the least influence. Table10. of Friedman ranking test for innovation components Ranking average Challenge 6.85 Freedom 5.14 Negotiation 4.85 Idea time 4.3 Friendliness 3.67 Risk taking 1.89 Trust 1.3 CONCULSION The most important goal of this study is to measure the influence of transformational leadership on innovation. The results of this study show that there is a meaningful and positive relationship between transformational leadership and innovation (0.692). Also this relationship is proven to exist between all components of transformational leadership and innovation. This correlation for components of transformational leadership comes as follow: idealizes influence (0.657), inspirational motivation (0.584), intellectual simulation (0.625), and individualized consideration (0.673). So, the most degree of correlation is between transformational leadership and individualized considerations (0.673), and the least exist between transformational leadership and inspirational motivation (0.584). This finding is in compliance with Mirkamali & Choupani (2011) findings. They in a study The Relationship Between transformational Leadership and Organizational done in an insurance company, showed that there is a positive and meaningful relationship between transformational leadership and all parameters of innovation. They have considered three parameters of transformational leadership namely intellectual simulation, inspirational motivation, and idealized influence as predictable s to enter the final regression equation. They have showed the tendency toward innovation as basic. Also, the results of this study come along with Jalilian and his colleagues study. They found that the leadership style pave the way toward innovation in employees and organization. Leaders with some measures can increase their staff s innovation capacities like boosting motivation, stimulating intellectually, elevating psychological competencies, supporting creative ideas, giving insight, creating an atmosphere of freedom and challenging the situation. The most important intervening factors between transformational leadership and innovation are: business challenges, manager s support, manager s charisma, and the atmosphere of freedom.gumusluoglu & Ilsev (2006) studied transformational leadership with innovation regarding the effects of internal and external supports. This study also confirms the positive relationship between transformational leadership and innovation. 3775

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