Impact of Leadership and Reward Systems on Organization Performance

This research project investigates the impact of leadership and reward systems on organizational performance. The study begins with an introduction to the topic, followed by a detailed outline of the research project specification, including aims and objectives. Task 1 focuses on formulating the research outline, identifying factors influencing project selection, and conducting a critical review of relevant literature, which includes studies on various leadership styles and their effects on business strategy, employee motivation, and organizational performance. Task 2 involves efficiently matching resources to the research question, proposing a research investigation, and collecting data. Task 3 delves into the analysis and interpretation of results, utilizing appropriate evaluation techniques to assess the impact of different leadership styles (autocratic vs. democratic) and reward systems (financial vs. non-financial). The findings are presented with supporting figures and data analysis, leading to recommendations and justifications for further consideration. The research utilizes both primary and secondary data, including survey responses and literature reviews, to draw conclusions about the relationship between leadership, reward systems, and organizational success. The report concludes with a presentation of findings, references, and appendices that further elaborate on the research methodology and results.

RESEARCH PROJECT

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Formulate and record possible research project outline specification..............................1
1.2 Identify factors that contribute to process of research project selection..........................2
1.3 Critical review of references............................................................................................2
1.4 Research project specification..........................................................................................4
1.5 Appropriate plan and procedure for agreed research specification..................................5
TASK 2............................................................................................................................................6
2.1 Match resources efficiently to research question or hypothesis.......................................6
2.2 Proposed research investigation in accordance with agreed specifications and procedures
................................................................................................................................................6
2.3 Record and collate relevant data where appropriate.........................................................7
TASK 3............................................................................................................................................8
3.1 Appropriate research evaluation techniques.....................................................................8
3.2 Interpretation and analysis of results in terms of original research specification............8
3.3 Making recommendation and justifying areas for consideration...................................10
Task 4.............................................................................................................................................10
4.1 Presentation of findings..................................................................................................10
........................................................................................................................................................15
REFERENCES..............................................................................................................................16
APPENDIX....................................................................................................................................18
Figure 1Respondents response on question” Do you think that leadership and organization
performance are interlinked to each other?.....................................................................................7
Figure 2Respondents response on questions "Good leadership led to development of effective
strategies in the business."...............................................................................................................8
Figure 3Respondents response on question "Leaders play significant role in motivating
employees at the workplace."..........................................................................................................9

Figure 4Respondent response on questions “Do you think that autocratic leadership style
negatively affect firm performance?................................................................................................9
Figure 5Respondents response on questions “Do you think that democratic leadership style
negatively affect firm performance?"............................................................................................10
Figure 6Respondents response on questions “Reward system positively affect the employee’s
performance. Do you agree? ".......................................................................................................10
Figure 7Respondents response on question "Financial incentives lead to improvement in
employee’s performance and this ultimately lead to improvement in organization performance."
.......................................................................................................................................................11
Figure 8Respondents response on questions "Non-financial incentives lead to improvement in
employee’s performance and this ultimately lead to improvement in organization performance"
.......................................................................................................................................................12

INTRODUCTION
Leadership is the one of the main factor that play an important role in growth of an
organization. This is because every leader have different ideology which lead to change in the
satisfaction level of the stakeholders in the business. In past time period varied research studies
are conducted and on same it is identified that leadership greatly affect an organization
performance. This is because leader by its own action prove himself and guide subordinates to
take important steps to improve organization performance. In the current research report
secondary and primary data is collected and same is analysed to arrive at specific conclusion. In
this way entire research is carried out.
TASK 1
1.1 Formulate and record possible research project outline specification
Background of study
There are number of leadership styles that are followed by an individual to manage
business operations. Past research studies reflects that there are positive and negative sides of
different leadership styles and all of them positively and negatively affect the organization
performance. Thus, it can be said that past research studies advocate the fact that leadership and
organization performance are interrelated to each other (What is leadership, 2017). On other
hand, reward system is another factor that have correlation with the firm business performance. It
can be observed in the past researches that in an organization where heavy amount of rewards are
given to the employees same feel motivated and do hard work for benefit of an organization. Due
to obtaining high reward employees feel motivated to work hard at the workplace and this lead to
enhancement in their efficiency and performance level.
Aim of research
To identify the impact of leadership and reward system on the organization performance.
Objective of research study
Objectives of research study are as follows.
 To identify impact that leadership have on formulation of business strategy for the firm.
 To identify impact that leadership have on the employee’s motivation level.
 To do comparison between autocratic and democratic leadership style in context of
impact that both have on organization performance.
 To identify impact of reward system on firm performance.
1

 To make comparison between impact of financial and non-financial incentives on
organization performance.
1.2 Identify factors that contribute to process of research project selection
In current time period business firms are facing a lots of problems in maintain their stable
growth rate. Giant firm’s market share is declining at sharp rate in the market. On other hand,
there are small firms that are growing at rapid pace and give tough competition to rivals.
Leadership is the one of the factor that lead to growth of the some of the business firms at rapid
pace in past couple of years. Thus, it was important to conduct the present research study so that
it can be identified that to what extent leadership contributes to success of business firm. Apart
from this, reward system is another factor on which due attention will be paid in the present
research study to explore impact that it have on the organization performance.
1.3 Critical review of references
To identify impact that leadership have on formulation of business strategy for the firm
According to Wang and et.al., (2011)1leadership play an important role in growth of any
organization. This is because any leader have clear mission and goals as well as vision. All
efforts of the leaders are channelize towards achievement of goals and objectives in the business.
Those leaders that have clear vision formulate strategy in right direction and pave a way for
growth of the business firm. It can be said that leadership play crucial role in growth of an
organization.
Contrary to this Wiseman, Cuevas‐Rodríguez and Gomez‐Mejia, (2012) state that
leadership alone does not play any role in progress of an organization. This is because leader
formulate policies and strategy but its implementation is dependent on subordinates. Sometimes
managers prepare strategy but same is not implemented in proper manner by subordinates and
even steps were taken to improve condition fruitful results are not obtained. Thus, it can be said
that it is the mixed efforts of the leader and his subordinates that make an organization
successful.
To identify impact that leadership have on the employee’s motivation level
As per views of Wang, Chich-Jen and Mei-Ling, (2010) leadership have significant
impact on the motivation level of the employees. This is because leaders are very energetic in
nature and they develop lots of enthusiasm among the subordinates by motivating them to do
hard work smartly. Those who work under leaders get inspiration from them and feel motivated
2

to achieve tough targets that are set as benchmark by their manager. Thus, leaders play a very
important role in motivating employees to do specific work.
Contrary to this Yang, (2010) state that those leaders who follow autocratic leadership
style failed to motivate employees to great extent. This is because those who are autocratic in
nature create a lot of dissatisfaction among the employees and due to this reason employees does
not feel free to do work at their own discretion. Thus, they feel demotivated while working under
autocratic leader. Hence, it can be said that leadership always does not motivate employees
sometimes it become big reason for demotivation of employees at the workplace.
To do comparison between autocratic and democratic leadership style in context of impact that
both have on organization performance.
According to Ejere and Abasilim, (2013) there is huge difference between autocratic and
democratic leadership style. This is because in former one manager follow a policy under which
it make an attempt to manage strict control on its subordinates by not involving them in decision
making process of an organization. All these things negatively affect an organization and lead to
elevation in gap that exist between top management and middle as well as lower level of
employees. All these things have adverse impact on the firm profitability. Opposite to this,
democratic leadership style positively affect the business firm. This is because though this
leadership style manager successfully maintain liaison relationship with its stakeholders. Thus,
decisions with full consensus is taken by the managers. Hence, it can be said that democratic
leadership style positively affect the business firm.
Contrary to this Ng. and Sears, (2012) state that both autocratic and democratic
leadership style have positive impact on the firm performance. This is because if manager adopt
autocratic leadership style then in that case it successfully manage discipline at the workplace.
On other hand, by adopting democratic leadership style one perform business operations in
proper manner. This reflects that one cannot consider specific leadership style less important.
To identify impact of reward system on firm performance.
According to Waldman, Balthazard and Peterson, (2011) it is very important to keep
employees satisfy at the workplace because their satisfaction level is directly linked to their
performance at the workplace. In order to improve employee’s performance reward must be
given to them in recognition of their performance. Such kind of things motivate employees to
work hard at the workplace. This lead to improvement in organization performance.
3

Contrary to this Laohavichien, Fredendall and Stephen Cantrell, (2011) state that in order
to improve organization performance firm cannot rely entirely on reward system. This is because
many times in the firm in order to motivate employees reward is given to them even it is not up
to required level. Such kind of things sometimes proved waste for the business firm and due to
this reason it can be said that it is not necessary that if reward is given to the employees then in
that case their performance will be improved.
To make comparison between impact of financial and non-financial incentives on
organization performance.
According to Liu and DeFrank, (2013) financial and non-financial incentives both must
be used by the managers to motivate employees to do hard work in the organization. It is not
necessary that if financial incentive is given to the employee then in that case it will be
motivated. This is because priority of each employee is different from each other. Hence, one
would like to receive financial incentives but there may be other person who may prefer to obtain
non-financial incentives. It can be said that it is not necessary that financial or non-financial
incentives will motivate employees to improve their performance. This means that it is possible
that incentives lead to moderate improvement in firm performance.
In contrary to this Stewart, Courtright and Manz, (2011) state that incentive heavily affect
an organization performance because through both firm recognize employees performance. This
motivate employees to do hard work at the workplace. In case of both sort of incentives
employees receive recognition and monetary as well as non-monetary benefits. Hence, it can be
said that employees benefited from both and due to this reason they feel motivated to work hard
for an organization.
1.4 Research project specification
As part of the research project specification aims and objectives are given below.
Aim of research
To identify the impact of leadership and reward system on the organization performance.
Objective of research study
Objectives of research study are as follows.
 To identify impact that leadership have on formulation of business strategy for the firm.
 To identify impact that leadership have on the employee’s motivation level.
4

 To do comparison between autocratic and democratic leadership style in context of
impact that both have on organization performance.
 To identify impact of reward system on firm performance.
 To make comparison between impact of financial and non-financial incentives on
organization performance.
1.5 Appropriate plan and procedure for agreed research specification
S. No. Activity/Week April
2016
May
2016
June
2016 July 2016
25 2 9 1623 3 10 17 24 18
Week
number 1 2 3 4 5 6 7 8 9 1
0
11
1 Preparing proposal
2 Developing objectives
3 Developing thesis
4 Details related to varied components of
research project.
5 Collecting primary data
6 Data arrangement.
7 Thematic analysis
8 Preparing conclusion.
9 Preparing recommendation
10 Developing report
11 Submitting project
13 Final submission
5

TASK 2
2.1 Match resources efficiently to research question or hypothesis
In order to conduct the present study varied resources are used. First of all secondary data
is analysed and same is taken from the varied sources like books, journals and magazines. It is
the important resource that is used to carry out secondary data analysis. In order to conduct
primary study 2 people will be hired that will be responsible for data collection and distribution
of questionnaire. Time is another important resource that is used in prudent manner to complete
the project. Proper allocation of activities is done across time period so that project can be
completed on time. Apart from this, software like MS Excel is also used for charting and creation
of tables for analysis purpose.
2.2 Proposed research investigation in accordance with agreed specifications and procedures Research design: Exploratory research design will be used in the present research study
because by using same varied tools that can be used from collecting relevant data can be
identified and research can be carried out in proper manner (Morgan, 2013). Research type: Primary and secondary research will be carried out in the present research
study. In this regard questionnaire will be distributed among sample of 20 people.
Secondary data will be gathered from books, journals and magazines. Research approach: In order to conduct present research inductive method is selected.
This is because by following relevant approach in proper manner varied areas can be
observed and on that basis conclusion can be formed. Research philosophy: Present research study is nonscientific in nature and on this basis
interpretivism philosophy will be used in the present research study. Data collection and sampling: Data collection will be done from books, journals and
magazines (Mackenzie and et.al., 2012). Apart from this, questionnaire will be distributed
among respondents for data collection. Sample of 20 respondents will be taken in the
present research study that are employees in the business firms. Sample of 20
respondents is taken because main aim was to gather relevant information from reliable
sources. Thus, sample of 20 employees is taken. It is not possible to establish contact and
to gather data with large number of employees of the firm. Hence, sample of 20
respondents is justified. Apart from this, focus was on gathering reliable data. In case,
large size sample taken in the research then it is hard task to identify errors that is in
6

response that is given by respondents. On other hand, if sample size is small it becomes
easy to identify errors if there is any in gathered data. On time, steps can be taken to
rectify errors. Thus, reliable data can be gathered with small sample size and reliable
results can be obtained from the research. Data analysis: In order to analyze the data set thematic analysis method will be used in
the present research study. Under this number of respondents on likert and other scale for
each question will be analyzed separately. Ethical considerations: It will be ensured that data related to respondents is safe and
inaccessible from the access of unauthorized person. In this regard proper security of data
will be done.
 Research limitations: One of the main limitation of the present research study is that less
number of respondents were taken in the research (Gupta and Gupta, 2011.). Thus, it is
possible that accurate result may not be obtained. However, in this research it is ensured
that only those candidates are taken as respondents that have good knowledge of research
subject.
2.3 Record and collate relevant data where appropriate
Do you think that leadership and organization performance are interlinked to each other?
Yes 15
No 5
Good leadership led to development of effective strategies in the business.
Strongly agree 8
Agree 7
Neutral 2
Disagree 1
Strongly Disagree 2
Leaders play significant role in motivating employees at the workplace.
Strongly agree 9
Agree 6
Neutral 2
Disagree 1
Strongly Disagree 2
7

Do you think that autocratic leadership style negatively affect firm performance?
Yes 17
No 3
“
Do you think that democratic leadership style negatively affect firm performance?
Yes 3
No 17
Reward system positively affect the employee’s performance. Do you agree?
Yes 18
No 2
Financial incentives lead to improvement in employee’s performance and this ultimately lead to
improvement in organization performance.
Strongly agree 9
Agree 5
Neutral 2
Disagree 2
Strongly Disagree 2
Non-financial incentives lead to improvement in employee’s performance and this ultimately
lead to improvement in organization performance.
Strongly agree 8
Agree 4
Neutral 2
Disagree 2
Strongly Disagree 4
TASK 3
3.1 Appropriate research evaluation techniques
There are number of research evaluation methods that are available to the researchers and
it depend on them that which of the approach they find more useful for research evaluation. It
can be said that there is significant importance of the research evaluation method for the
researchers. Onion approach is the one of the main technique that can be used to evaluate
research and same is used in the present research study under research methodology section.
3.2 Interpretation and analysis of results in terms of original research specification
Do you think that leadership and organization performance are interlinked to each other?
8

Research results are clearly indicating that there are large number of respondents who assume
that leadership heavily affect the organization performance. There are 15 respondents who are
agree with the mentioned fact. There are only 5 respondents out of 20 who are disagree with
same fact. It can be said that people have common assumption that it is the leadership that
heavily affect the firm performance.
Good leadership led to development of effective strategies in the business.
Facts are revealing that there are 8 respondents out of 20 that are strongly agree with asked
statement followed by 7 respondents are agree and 2 are neutral. Apart from this, there is 1
respondent that is disagree and 2 respondent which are strongly disagree on same statement. It
can be said that there is common assumption among the people that if there is strong leadership
in the firm then good strategies are developed in the business firm.
Leaders play significant role in motivating employees at the workplace.
9 respondents are strongly agree, 6 agree, 2 are neutral followed by 1 is disagree and 2
respondents are strongly disagree with same statement. It can be said that leadership play a very
important role in enhancing motivation level of employees at the workplace.
Do you think that autocratic leadership style negatively affect firm performance?
Facts are revealing that there are 17 respondents who think that autocratic leadership style lead to
decline in the firm performance. There are only three respondents that are disagree with the
mentioned statement.
Do you think that democratic leadership style negatively affect firm performance?
There are only 3 respondents who assume that democratic leadership style have negative impact
on the firm performance. Rest number of respondents think opposite to this. It can be said that
firm performance is positively linked to democratic leadership style.
Reward system positively affect the employee’s performance. Do you agree?
Facts are revealing that reward system positively affect the employees performance. This fact is
supported by 18 respondents and opposed by 2 respondents. It can be said that reward system
positively affect employee performance.
Financial incentives lead to improvement in employee’s performance and this ultimately lead
to improvement in organization performance.
On analysis of facts it can be said that financial incentives lead to improvement in employee’s
performance and this ultimately lead to improvement in firm performance. This fact is supported
9

by 9 respondents that are strongly agree and 5 respondents that are agree on same statement.
There are only 2 respondents that are neutral followed by 2 are disagree and same number of
respondents are strongly disagree on same statement. It can be said that financial incentives lead
to improving organization performance.
Non-financial incentives lead to improvement in employee’s performance and this ultimately
lead to improvement in organization performance.
There are 8 respondents that are strongly agree and 4 are agree followed by 3 are neutral. Apart
from this, there are 2 respondents that are disagree and 4 are strongly disagree on same
statement. It can be said that non-financial incentives lead to improvement of employees and
firm performance.
3.3 Making recommendation and justifying areas for consideration
It is recommended that business firms must focus on both financial and non-financial
incentives and must selectively give both to the employees so that it can be ensured that
employees are feeling motivated at the workplace. If employees will be motivated then they will
give their maximum contribution for benefit of the firm and this will lead to elevation in its
profitability. It can be said that motivation level and reward system lead to improving firm
performance.
Task 4
4.1 Presentation of findings
Do you think that leadership and organization performance are interlinked to each other?
10

Figure 1Respondents response on question” Do you think that leadership and organization
performance are interlinked to each other?
“
11

Good leadership led to development of effective strategies in the business.
Figure 2Respondents response on questions "Good leadership led to development of effective
strategies in the business."
Leaders play significant role in motivating employees at the workplace.
Figure 3Respondents response on question "Leaders play significant role in motivating
employees at the workplace."
12

Do you think that autocratic leadership style negatively affect firm performance?
Figure 4Respondent response on questions “Do you think that autocratic leadership style
negatively affect firm performance?
“
Do you think that democratic leadership style negatively affect firm performance?
Figure 5Respondents response on questions “Do you think that democratic leadership style
negatively affect firm performance?"
Reward system positively affect the employee’s performance. Do you agree?
13

Figure 6Respondents response on questions “Reward system positively affect the employee’s
performance. Do you agree? "
Financial incentives lead to improvement in employee’s performance and this ultimately lead to
improvement in organization performance.
Figure 7Respondents response on question "Financial incentives lead to improvement in
employee’s performance and this ultimately lead to improvement in organization performance."
Non-financial incentives lead to improvement in employee’s performance and this ultimately
lead to improvement in organization performance.
14

Figure 8Respondents response on questions "Non-financial incentives lead to improvement in
employee’s performance and this ultimately lead to improvement in organization performance"
CONCLUSION
On the basis of above discussion it is concluded that leadership and organization
performance are interlinked to each other. If there is good leadership in the firm effective
strategies can be developed in the business. Leadership plays an important factor in motivating
employees to work more efficiently in the organization. Managers must ensure that they are not
following autocratic leadership style in the business management. This is because such kind of
behaviour create negative image of the firm among the employees. Instead of this leaders must
follow democratic style in the business. It is also concluded that in order to improve employees
performance financial and non-financial incentives must be given to employees.
15

REFERENCES
Books and journals
Dunne, C., 2011. The place of the literature review in grounded theory research. International
Journal of Social Research Methodology. 14(2). pp.111-124.
Ejere, E.I. and Abasilim, U.D., 2013. Impact of transactional and transformational leadership
styles on organisational performance: empirical evidence from Nigeria. The Journal of
Commerce. 5(1). pp.30-41.
Gupta, M. and Gupta, D., 2011. Research methodology. New Delhi: PHI Learning Private.
Laohavichien, T., Fredendall, L.D. and Stephen Cantrell, R., 2011. Leadership and quality
management practices in Thailand. International Journal of Operations & Production
Management. 31(10). pp.1048-1070.
Liu, Y. and DeFrank, R.S., 2013. Self-interest and knowledge-sharing intentions: The impacts of
transformational leadership climate and HR practices. The International Journal of Human
Resource Management. 24(6). pp.1151-1164.
Mackenzie, J. and et.al., 2012. The value and limitations of Participatory Action Research
methodology. Journal of Hydrology. 474. pp.11-21.
Morgan, G., 2013. Riding the waves of change. Imaginization Inc.
Ng, E.S. and Sears, G.J., 2012. CEO leadership styles and the implementation of organizational
diversity practices: Moderating effects of social values and age. Journal of Business
Ethics. 105(1). pp.41-52.
Stewart, G.L., Courtright, S.H. and Manz, C.C., 2011. Self-leadership: A multilevel
review. Journal of Management. 37(1). pp.185-222.
Waldman, D.A., Balthazard, P.A. and Peterson, S.J., 2011. Leadership and neuroscience: Can we
revolutionize the way that inspirational leaders are identified and developed?. The Academy
of Management Perspectives. 25(1). pp.60-74.
Wang, F.J., Chich-Jen, S. and Mei-Ling, T., 2010. Effect of leadership style on organizational
performance as viewed from human resource management strategy. African Journal of
Business Management. 4(18). p.3924.
Wang, G. and et.al., 2011. Transformational leadership and performance across criteria and
levels: A meta-analytic review of 25 years of research. Group & Organization
Management. 36(2). pp.223-270.
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Wiseman, R.M., Cuevas‐Rodríguez, G. and Gomez‐Mejia, L.R., 2012. Towards a social theory
of agency. Journal of Management Studies. 49(1). pp.202-222.
Yang, J., 2010. The knowledge management strategy and its effect on firm performance: A
contingency analysis. International Journal of Production Economics. 125(2). pp.215-223.
Online
What is leadership, 2017. [Online]. Available through :<
https://www.mindtools.com/pages/article/newLDR_41.htm>. [Accessed on 20th June 2017].
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APPENDIX
Name:_________________________
Age:___________________________
Occupation:______________________
Do you think that leadership and organization performance are interlinked to each other?
 Yes
 No
Good leadership led to development of effective strategies in the business.
 Strongly agree
 Agree
 Neutral
 Disagree
 Strongly disagree
Leaders play significant role in motivating employees at the workplace.
 Strongly agree
 Agree
 Neutral
 Disagree
 Strongly disagree
Employee motivation lead to improvement in firm performance.
 Strongly agree
 Agree
 Neutral
 Disagree
 Strongly disagree
Do you think that autocratic leadership style negatively affect firm performance?
 Yes
 No
Do you think that democratic leadership style negatively affect firm performance?
 Yes
 No
18