THE EFFECTS OF LEADERSHIP PRACTICE ON EMPLOYEES’ PERFORMANCE: THE CASE OF DARASALAM BANK

Abstract

This study was conducted at headquarter and two branches of Darasalam Bank in Hargeisa Somaliland. The main purpose of this study was to examine the effects of leadership practice on employees’ performance. The research design used was explanatory research design and the research approach was employed both quantitative and qualitative. To this effect, combinations of quantitative and qualitative research methodology was appropriately used in the study because; mainly primary data was used and collected through questionnaire and interview from the HRD in Darasalam Bank. To do so, the researcher selected 50 employees from the total employees of 150 as a sample based on simple random sampling technique using lottery method and purposively sampling was employed for the interview. Seven Leadership styles were used for the test namely Democratic, Laissez-Faire, Autocratic, Transformational, Charismatic, Transactional and Bureaucratic which indicated the relationship of leadership styles with employee performance of Darasalam Bank in Hargeisa City. After the data were collected, it was analyzed in qualitative and quantitative method of data analysis through the use of SPSS version 20 and the statistical analysis was made such as descriptive statistics, Pearson correlation, multiple linear regression, reliability and validity tests. The findings of the study resulted, the democratic leadership style was not highly practiced in Darasalam Bank Hargeisa, Bureaucratic leadership was practiced followed by autocratic leadership style and also the laissez-faire leadership did not exist. The study finding indicated that the most employees are not doing excellence performance due to the limited practice of leadership conducted by supervisors of DB, also findings indicating a weak level of workers performance due to the leadership influence. However the findings discovered that there is a positive significant correlation between leadership practice and employees’ performance except laissez-faire leadership. The researcher concluded practicing bureaucratic leadership has a great effect on employee performance it brings about dissatisfaction of employees caused by its rigidity and restrictions. The researcher recommends that: empowerment was needed through developing teams and measure of power and authority to teams, enhancing participation of decision making process of employees and should reduce the dominance of bureaucratic leader ship by giving training that provides professionalism and transparency.