What type of leadership is more effective for managing change during force majeure? Achieving organizational effectiveness during the pandemic
DOI:
https://doi.org/10.1108/RAUSP-01-2023-0007Keywords:
Transformational Leadership, Ethical Leadership, Social Exchange Theory, Covid-19, Organizational Effectiveness, Force-Majeure, Public Sector Banks, Private Sector BanksAbstract
Purpose: Leaders have been facing serious challenges in managing organizations during COVID-19, which has brought the need for implementing sudden technological change across the globe. Hence, it was important to identify effective leadership styles to successfully manage the transformational process during the period. Therefore the current study tends to explore and compare the effectiveness of transformational and ethical leadership in terms of achieving organizational goals during COVID-19 in public and private sector organizations in Pakistan.
Design/Methodology: Comparative research was carried out to find out the effectiveness of transformational and ethical leadership during and pre-COVID-19 in public and private sector organizations using the lens of social exchange theory. Data was collected from 214 respondents representing 67.6% public and 32.4% private sector organizations of Pakistan at two different points in time. Detailed comparative analyses were conducted in AMOS version 24, to assess the effectiveness of leadership styles before and during COVID-19 times.
Results: On the whole, transformational leadership was found to have more impact on organizational effectiveness in comparison with ethical leadership in both pre-and during COVID-19 situations. Moreover, the effectiveness of transformational leadership significantly increased and the same decreased for ethical leadership during COVID-19. Additional analyses indicated that transformational leadership was effective for the private sector and ethical leadership for the public sector organizations during COVID-19.
Limitations: The study has not considered the mediating mechanisms of employee motivation, engagement, and performance in the relationship between transformational and ethical leadership styles and organizational effectiveness, which can be explored in the future.
Implications: These results have important implications for private and public sector organizations and suggest that the adoption of a transformational leadership style will generate better results in the private sector and an ethical leadership style in public sector organizations to achieve organizational effectiveness during uncertain situations like COVID-19.
Social Implications: The study shows that leadership with more care and concern for humanity tends to perform better in terms of generating results for organizational effectiveness. Therefore, both transformational and ethical leadership are based on individualized consideration for employees and are effective during COVID-19 in private and public sector organizations in Pakistan.
Originality: The study has carried out the comparative analyses in three different ways including leadership styles (Transformational and Ethical), type of organization (private and public), and time frames (pre and during COVID-19), which is a true contribution of the research in the Pakistani context.
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