The Effect of Individualized Consideration and Intellectual Stimulation on Organizational Performance of Commercial State Owned Enterprises in Kenya

Abstract

There is a limited understanding about the role of leadership on organizational performance in the context of customer service sector. Customer service sector is getting more and more importance in recent years as firms are directing their attention towards proving the best quality of service to their customers along with manufacturing. Therefore, the motivation of this paper is to investigate the impact of leadership behaviour on organizational performance in the context of customer service sector. Data was collected from 170 senior managers from 34 commercial state corporations in Kenya using self-administered questionnaire. Using ordinary linear regression, the results show that individualized consideration had a significant and negative effect on organization performance implying that discouraging individual consideration in a commercially owned enterprise would improve organization performance. However, intellectual stimulation did not have any significant effect on organization performance. The paper recommends that organizations targeting to improve organization performance must work on employee- friendly company culture, degree of employee’s inclination to be more productive than non-motivated employees, power of company financial incentives and team work. In addition, they must work towards discouraging delegation of tasks, career mentoring and couching, and creation of new learning opportunities alongside a supportive climate.

Keywords: Intellectual Stimulation, Individualized Consideration, Organizational Performance, State-Owned Enterprises