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Waganeh Wassie Ayele
University of Tourism excellence and Business Administration, Lusaka, Zambia
Humanities Computer Science & IT Earth & Planetary Sciences Economics, Econometrics & Finance Environmental Science

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The Effect of Leadership Practices on Organizational Performance: Evidence from The Ethiopian Banking Industry Sankaran Venkataramani; Waganeh Wassie Ayele
International Journal of Social Research Vol. 4 No. 3 (2026): Insight : International Journal of Social Research
Publisher : Worldwide Research Publishing

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.59888/insight.v4i3.111

Abstract

Leadership has become a strategic determinant of organizational success, yet in developing economies such as Ethiopia, where the banking industry faces intensifying competition, digital transformation, low employee engagement, and persistent inefficiency, empirical evidence on which leadership practices most influence performance remains limited, and prior studies typically isolate a single leadership style. This study aimed to determine the extent to which four managerially controllable practices, namely communication, leadership support, employee participation, and performance feedback, predict organizational performance in the Ethiopian banking industry, modelling them simultaneously as an integrated set of predictors. A quantitative approach was employed, using a structured five-point Likert questionnaire distributed to employees of ten leading commercial banks. Of the 230 questionnaires distributed, 190 valid responses (a response rate of 82.6%) were analyzed in SPSS version 27 using descriptive statistics, Pearson correlation, and multiple regression. All four variables had positive and statistically significant effects, jointly explaining 58.5% of the variance in performance (adjusted R² = 0.585; F = 67.655, p < 0.001). Communication exerted the strongest influence, followed by leadership support, employee participation, and performance feedback. The findings extend transformational leadership theory and the resource-based view, offering banks and policymakers an evidence-based ordering of practices for prioritising organizational-development investments.
Effect of Leadership Style on Employee performance: A case of Dashen bank, Addis Ababa, Ethiopia Waganeh Wassie Ayele; Sankaran Venkataramani
International Journal of Social Research Vol. 4 No. 3 (2026): Insight : International Journal of Social Research
Publisher : Worldwide Research Publishing

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.59888/insight.v4i3.112

Abstract

Leadership style is widely regarded as a decisive factor shaping employee performance in the banking sector, yet comparative empirical evidence on multiple leadership styles within a single Ethiopian bank remains limited. This study aimed to examine the effect of four leadership styles Autocratic, Democratic, Laissez-faire, and Transformational on employee performance at Dashen Bank, Addis Ababa. Both descriptive and explanatory designs were employed, utilizing a combination of quantitative and qualitative methods. From the total population of 1,851 employees, 329 respondents were selected through a combination of stratified and simple random sampling. Data came from structured questionnaires and were supported by a review of relevant literature. Multiple regression analysis produced a strong overall model (R = 0.989, R\u00b2 = 0.978), indicating that the four leadership styles jointly explained 97.8% of the variance in employee performance. The results showed that the democratic, transformational, and laissez-faire leadership styles are positively and significantly correlated with employee performance, but there was no significant effect for the autocratic leadership style. This implies that participative and inspirational leadership styles are more effective in increasing employee motivation, productivity, and engagement, while strict autocratic approaches do not have a significant impact on performance. Based on these findings, it is recommended that Dashen Bank's management strengthen leadership development programs for branch leaders in Addis Ababa, with emphasis on democratic and transformational leadership competencies, so as to sustain measurable improvements in employee performance across all branches.
Co-Authors Sankaran Venkataramani