Influence Of Transformational Leadership Outcomes On Performance Of Staff In Microfinance Institutions In Kenya

As discipline, leadership is cross cutting and differentiates one organization from the other. Microfinance organizations are no different. Powell (2011) insists that leadership is critical and crucial to both the growth and change in organizations. Leadership is described as the bond that makes people of diverse nature and background work together to achieve a common goal (Usman, 2011). The style of leadership has been found to determine the level of satisfaction and productivity of employees in an organization (Taylor, 2014; Victoria, 2011). Different leadership behaviors produce different effects on employees  and have clearly distinct outcomes (Erkutlu, 2008).

Transformational leadership outcomes as described above range from higher employees‘ satisfaction, commitment and productivity or lack of the same.  It is a fair assessment to state that leadership behavior therefore regulates and controls the effectiveness of the organization. Effects of leadership outcomes have been seen to influence the commitment that staff have on the organization (Nair, 2014). A majority of challenges faced by institution are greatly reduced if the right leadership is employed (Abdul & Dean, 2013)

Transformational leadership has been related to several outcomes in staff. Trust level that employees have defined their stay in organization, the commitment and the urge to do new things within organizations. Transformational leadership outcomes reinforce the desire for staff to continue working in an organization as well as their willingness to be innovative which leads to the company gaining a competitive edge over the peers in a sector (Augustine, 2012; Chan, 2010; Chang & Lee, 2010). The impact of transformational leadership outcomes is felt through follower development. Key transformational outcomes have been studied (Verma, Robles, Alavi, Karami, Albino, Alvesson, & Yeung, 2013). The effects leaders have on followers are attributed to the relationship that defines their day-today interactions.