The Impact of Leadership Style and Work Environment on Employee Performance: Work Motivation and Organizational Citizenship Behavior

The Impact of Leadership Style and Work Environment on Employee Performance: Work Motivation and Organizational Citizenship Behavior

Athapaththu D.A.M.R.C.J¹, Rebecca, E.^2*

¹Department of Human Resource Management Faculty of Commerce and Management Studies University of Kelaniya, Sri Lanka

^2*Senior Lecturer, Department of Human Resource Management Faculty of Commerce and Management Studies, University of Kelaniya, Sri Lanka

*Corresponding Author

DOI: https://dx.doi.org/10.47772/IJRISS.2025.90500074

Received: 05 March 2025; Accepted: 13 March 2025; Published: 30 May 2025

ABSTRACT

This study investigates the impact of leadership style and work environment on employee performance, with a focus on the mediating roles of organizational work motivation and citizenship behavior (OCB). Employee performance outcomes are significantly influenced by leadership style and a positive work environment. In order to investigate this impact, the researcher focused on only one selected IT company. Leadership style, work environment, work motivation and organizational citizenship behavior play a pivotal determinant of the employee performance. A comprehensive literature review serves as the foundation for the research, including theories and empirical findings from leadership style, work environment, work motivation, organizational citizenship behavior and employee performance. A cross-sectional quantitative research framework applied for the conduct of this study. Data was collected through a structured questionnaire and the study used employs survey and Statistical Package for Social Sciences (SPSS) analysis for data collection and interpretation. The analyzed results indicate that there is a positive impact of leadership style and work environment on employee performance with the mediation effect of work motivation and organizational citizenship behavior. Consequently, this study provides significant implications for the company determining strategies to enhance employee performance and to retain the talented employees within the organization.

Keywords: Employee Performance, Leadership Style, Organizational Citizenship Behavior, Work Environment, Work Motivation

INTRODUCTION

A business entity requires good management in order to achieve organizational goals. (Mariam & Ramli,2017). Human Resource Management (HRM) is a crucial organizational strategy that places an importance on managing the workforce and helping employees internalize the organization’s values which would further improve employee performance and ultimately organization’s success. In today’s business world, Information Technology (IT) plays a vital role in leading the country to economic growth and success. According to the statistics, with over 500 companies, the Sri Lankan IT sector currently serves a variety of industry verticals (EDB, 2022).  Sri Lanka’s IT industry is one of the most profitable to date, since it has a highly skilled workforce and cost-effective operational capabilities. With the expansion of the IT industry, competition intensifies, necessitating organizations to improve employee performance in order to gain a competitive advantage. Ratnasari (2016) defines employee performance as the work results of employees in terms of quantity and quality over a specific period. Improved employee performance will also influence the increase in work performance and employee satisfaction. Hence, organizational goals can be achieved properly (Ramli & Yudhishthira, 2018). Siagan (2002) studies show several triggers for employees to perform well, including skills, motivation, leadership, and work environment.

According to that, many factors influence employee performance, including leadership style, work environment and other related factors. Leadership style is an important factor that impacts employees’ attitudes and behaviors including organizational commitment. Good leadership is crucial for the organization’s efficiency and effectiveness. Nowadays, Various leadership are used by organizations depending on their nature and how the organizations operate. leadership is known as the capacity to influence others’ actions and behaviors in order to accomplish objectives and optimize results within an organization. According to Daft (2011), ‘‘Leadership is an influence relationship among leaders and followers who intend real changes and outcomes that reflect their shared purposes’’. Most appropriate leadership style is a style that can maximize productivity, job satisfaction, growth, and easily adapt to all situations. Accordingly, a leader needs to be able to motivate and guide his subordinates by enacting significant change that accomplishes a shared objective.

The work environment is always directly related to the performance of the employees. Because the workplace serves as a place for employees to complete the tasks that the business assigned them. The work environment encompasses both the physical and non-physical elements of the workplace that contribute to your sense of comfort, security, and productivity. Furthermore, the worker is always in direct interaction with the work environment. Therefore, Positive work environment can be enhanced the employee performance. Sedarmayanti (2011), defines the work environment as the entire toolkit and materials faced by the surrounding environment in which people work, their work methods, and their work arrangements both as individuals and as groups. Apart from leadership style and work environment, the work motivation also determines the performance of the employees. Work motivation is a process of intensity, direction, and individual persistence towards achieving goals (Wibowo,2014). Work motivation is seen as a crucial factor in driving the success of companies, as it enhances the efficient performance of employees. Siti Narmita Yamin’s research (2021) found that work motivation has a direct, positive, and significant impact on employee performance. In addition to above mentioned factors, Organizational Citizenship Behavior (OCB) affects employee performance. According to Sari Permata and Ali (2022), “Organizational citizenship behavior is a voluntary attitude that employees have by doing more work and has nothing to do with the official reward system in the company, but when viewed as a whole, helps improve the efficiency of the company”. Moreover, Schermerhorn, et.,al (2012) also suggested that someone who behaves well in OCB will do additional things that help others and advance the overall organizational performance. Luthans (2011) state that organization citizenship behavior positively relates to individual performance, group performance and organizational performance. OCB has the potential to diminish conflicts within the organization and strengthen team cohesion, resulting in improved collaboration and overall group performance.

Based on above mentioned factors, this study aims to investigate the impact of leadership style and work environment on employee performance with work motivation as a mediating variable. In addition, this research aims to investigate the impact of mediation of Organizational Citizenship Behavior on employee performance. This research presents a theoretical framework outlining the factors that influence employee performance, and it conducts an empirical assessment of the theoretical framework.

Objectives of the study

General Objective

To identify the impact of leadership styles and work environment on employee performance.

Specific Objectives

• To identify the impact of leadership styles on employee performance.
• To identify the impact of work environment on employee performance.
• To identify the impact of work motivation as the mediator in the relationship between leadership style and employee performance.
• To identify the impact of work motivation as the mediator in the relationship between work environment and employee performance.
• To identify the impact of organizational citizenship behavior as the mediator in the relationship between leadership style and employee performance

LITERATURE REVIEW

Employee Performance

According to Robbins & Judge (2009), Employee performance is the result of an employee’s achievements in working according to certain criteria that apply to a certain job, employee performance is a function of the interaction of abilities and motivation. Employee performance in an organization is an important aspect of maintaining the productivity generated by the company (Saidi et al., 2019). Employee Performance is anything that demonstrates employee outcomes or work results, both financially and non-financially, that are directly tied to the performance and success of the company (J. Anitha,2014). Employee performance is one of the parameters for knowing how the organization’s human resources have contributed to the organization’s growth (Widodo & Yandi, 2022). Mathis & Jackson (2016) defines that indicators of employee performance include quantity, quality, accuracy, attendance, and ability to work. A good employee performance is necessary for the organization, since an organization’s success depends on the employee’s creativity, innovation, and commitment (Ramlall, 2008).Tolu et al. (2021) demonstrate that leadership style positively influences employee performance, as a leader’s approach affects employees’ ability to fulfill their responsibilities. The results of Al-Omari & Okasheh’s (2017) research on “The Influence of Work Environment on Job Performance: A Case Study of Engineering Company in Jordan” indicate that there is a positive and significant correlation between work environment and job performance which suggests that employers can implement initiatives to motivate staff through improving the work environment in order to achieve common goals and targets. Research by Guterresa et al. (2020) demonstrates that work motivation has a positive effect on employee performance. Fitriastuti (2013) found in his research that Organizational Citizenship Behavior (OCB) significantly enhances employee performance. According to Koster & Sanders (2006), OCB affects not only employee performance, but also their behavior and attitudes towards their organization.

Leadership Style

There is no single style of leadership that can be appropriated in each and every circumstance according to many researchers and theorists. Effective leadership requires a certain amount of control over a particular circumstance, the team’s dynamics, and the subordinates’ activities. Robbins (2015) defines leadership as “the ability to influence a group the achievement of targets”. Accordingly, Leadership is a process where a leader can influence and guide directly in order to accomplish goals and objectives in certain circumstance. Busro (2018) states that leadership is an influence related to the leader and the role of followers which leads to the achievement of real results. Somad & Priansa (2014) stated that the leadership style is the attitude, gesture, or demeanor that the leader decides to exhibit when carrying out their responsibilities as a leader. Effective leaders may inspire and influence their workforce by fostering a supportive organizational culture (Haoa & Yazadanifardo,2015). An appropriate leadership style is adopted by leaders to make subordinates do their activities with pleasure, further leaders strengthen the interaction with coworkers since subordinates enjoy working with coworkers (Nurani et al.,2021). Research conducted by Hakim et al.,2021, Performance can be influenced by the style of the leader. According to Turay et al. (2019), leaders can motivate subordinates by focusing on task clarity, goal attainment, and execution. Leadership could influence the motivation of employees which leads to increasing the performance of employees. The results of a study that was carried out by Wahyuningsing and colleagues (2013) indicate that leadership has a positive and significant impact on the motivation to work. Leadership positively affects OCB, according to studies by Widyaningrum (2020), Rosidi, et al., (2018), and Nurjanah, et al., (2020).  The study by Berkovich and Izhak (2024) found that teachers demonstrating high organizational citizenship behavior were highly influenced by a passive leadership style.

Work Environment

Sofyandi (2010), Work Environment is a condition in the environment around employees that can affect themselves in the implementation and completion of given tasks. According to (Sedarmayanti, 2017) are all conditions that exist around the workplace that will affect employees both directly and indirectly. According to Marie et al., (2017), the work environment consists of the system of work, the design of jobs, working conditions, and the ways in which people are treated at work by their managers and co-workers. The work environment is everything that is around employees that can affect employees in carrying out the tasks assigned by the company (Siagian and Khair, 2018). According to Gupta & Shaw (2014), the surrounding condition under which an employee works. Nitisemito (2000), the work environment encompasses everything around workers that can influence their task execution. . Employees spend a major considerable amount of time at work, and their working environment has an impact on their performance in integrated way (Wang X et al,2022). In addition, other empirical research conducted by Ingsih et al. (2021) and Michael et al. (2022) provides further evidence that a favorable work environment has a positive impact on the performance of employees. A previous study has revealed that factors which shape up the workplace environment show their impact on the performance of employee (Awada M et al, 2022). Jayaweera (2015) conducted research that demonstrated that employee performance is influenced by work environment conditions, including humidity, light, temperature, pollution, dust, and light factors. The research conducted by Suyono et al., (2021) demonstrates that the work environment has an impact on work motivation. In addition, research by Nasution et al. (2018), work environment significantly and positively impacts work motivation. Based on the findings of the research that Moulana et al. (2017) carried out, it is possible to draw the conclusion that the work environment and compensation have a positive relationship with the achievement of work motivation and employee performance.

Work Motivation

Work motivation is considered “a set of energetic forces that originate both within as well as beyond an individual’s being, to initiate work-related behavior, and to determine its form direction intensity and duration” (Pinder, C.C, 2014). Hauser, L. (2014) has proposed that the concept of work motivation might be seen as a source of positive energy that ultimately results in workers’ self-recognition and self-fulfillment. Luthans (2006) proposed that motivation is a process that begins with physiological or psychological deficiency that drives behavior or motives toward objectives or rewards. Motivation is a factor that affects the enthusiasm of work to participate actively in the work process (Oktarini, 2023). Bangun (2018) points out motivation as a condition that drives a person to carry out their tasks according to the function they have in an organization. Nicolescu and Verboncu (2008) argued that work motivation contributes directly and indirectly to employees’ performance. Sellang and Darman (2017) found that employee performance is influenced by work motivation. Ouakouak et al. (2020) shown that a leader’s style inherently influences the motivation of subordinates, since the leader’s behavior may motivate and cultivate the growth of employees. The findings of research conducted by Ingsih et al. (2021) demonstrated that high levels of work motivation are associated with improved employee performance. Research conducted by (Asmiadi et al., 2022) concluded that work motivation has a significant effect on performance. According to Diwiyani and Sarino (2018), there has been most likely a significant amount of research conducted on the topic of the relationship between leadership style and the work motivation of teachers. According to the findings of a study conducted by Wahyuningsing et al (2013), the findings of this study demonstrate that leadership has a positive and significant influence on the motivation to work. (Ahmadlyah et al.,2024). According to Saputro (2017), the findings of the analysis indicate that the leadership style has significant effects on performance, and this influence is mediated by the work motivation that exists among employees.

Organizational Citizenship Behavior

Organizational Citizenship Behavior is the behavior of an employee is not because of the demands of his job. OCB is defined by Daniels et al., (2006) as extra behavior of doing tasks in the workplace other than routine employee tasks. Organizational citizenship behavior (OCB) is a multidimensional concept that includes various aspects of voluntary behavior, namely outside the requirements (Hapsari et al., 2021). OCB as the individual’s behavior associated with additional tasks that exceed their primary duties and responsibilities (A. Katebi,). OCB is the behavior of employees who have the ability to empathize with others and their environment and are able to adjust the values they adopt with the values that apply to their environment (Edi and Wiwik, 2010). Employees that are willing and eager to go beyond their duties and responsibilities, assist their organizations in dealing with changes and unexpected occurrences (Joy et al.,2016). Based on the findings of Robbins and Judge (2013), there are five key dimensions that play a role in shaping OCB including Altruism, Conscientiousness, Civic virtue, Sportsmanship and Courtesy. Koster & Sanders (2006) stated that the attitude and behavior of the employees affects the performance of an organization. According to the findings of a study conducted by Atatsi et al.,2019, there is a positive relationship between OCB practices and employee performance. According to the Berkovich & Izhak. (2024) study indicated that teachers exhibiting high OCB were significantly impacted by a passive leadership style. Moradi et al.,(2011) found that there is a positive and significant correlation between OCB and transformational and transactional leadership. Transformational leadership was a more reliable predictor of OCB. Employees who engage with OCB are more likely to contribute to a positive work environment, enhance interpersonal relationships, and enhance job satisfaction (Ukasyah et al., 2023). Dian Hafit Syaifullah et. al.,2021stated that employee performance is significantly improved by organizational citizenship behavior.

Hypothesis of the study

A leadership style is a behavioral norm that an individual employs when attempting to influence the behavior of others or subordinates (Thoha, 2015). Several previous studies have also suggested that leadership style has an influence on employee performance, including research that has been conducted by (Tri Widodo et al., 2018); (Mardiana, 2014); (Djoko Setyo Widodo et al., 2017); (Chauhan et al., 2019); and (Bastari et al., 2020) which suggested that leaders in an organization should recognize and respect their employees at work, give equal rights to every employee, then leaders are also able to provide equal opportunities to employees without discriminating, Leaders can also grow funds to develop the togetherness of their employees, provide equal treatment to every employee and leaders can also carry out their obligations as a leader properly and responsibly, then this will improve employee performance both in quantity, quality, use of time, cooperation and employee attendance. Thus, it can be concluded that the work environment has a positive and significant influence on performance.

H1: There is a significant relationship between leadership Style and Employee performance

Businesses that overlook the work environment in the organization have an adverse effect on employee performance (J. Hanaysha,2016). The work environment has a direct and positive influence on performance, as evidenced by research (Hasibuan & Bahri, 2018) and research (Wahyuniardi et al., 2018). Mangkunegara (2011) indicates that employees can achieve their maximum performance when they possess a high achievement motive.  According to research by Jayaweera (2015), the circumstances of the workplace. Specifically, humidity, light, temperature, noise, dust, and light factors will impact on how productively employees work, indicating that the workplace helps to improve employee performance. Research indicates that a positive and healthy work environment can enhance employee performance, while a noisy environment can be harmful and decrease employee productivity (Girdwichai & Sriviboon, 2020).

H2: There is a significant relationship between Work Environment and Employee performance.

According to the Jayaweera (2015) research indicates that an effective leadership style and work motivation will enhance employee performance. Hence, work motivation can mediate the relationship between leadership style and employee performance. This research is in line with the findings of Mavhungu & Bussin (2017), who state that motivation plays a significant role in mediating the relationship between leadership style and performance, as subordinates consistently experience the effects of leadership style directly. Mutiya et al. (2022) stated that the mediation of work motivation allows leaders to develop a harmonious working relationship with their subordinates, resulting in enhanced employee satisfaction and performance due to the presence of caring leaders.

H3: Work motivation mediates the relationship between leadership style and employee performance

Tolu et al. (2021) conducted research that showed that an excellent work environment can lead to increased motivation, which in turn will improve employee performance. Jayaweera (2015) also states that organizations that emphasize employee motivation and performance will enhance their operations by consistently enhancing their work environments. When employees experience meaningful and fulfilling work in a supportive environment, they develop higher levels of intrinsic motivation. This leads them to engage in their tasks with more enthusiasm, creativity, and commitment, which results in better performance (Ryan & Deci, 2000). Research findings of Andi Prayogi, M., & Yani, I. (2021) pointed out that work environment on employee performance is mediated by work motivation directly.

H4: Work motivation mediates the relationship between work environment and employee performance.

Leaders who engage in open communication, listen to employee concerns, and involve employees in decision-making are more likely to foster a sense of commitment and trust. Employees respond to this leadership style by exhibiting higher levels of OCB, as they feel more connected to the organization and their colleagues (Podsakoff et al., 2000). Leaders who encourage OCB create a ripple effect: employees feel more motivated to help their colleagues, contribute to the organizational culture, and engage in behaviors that improve overall performance (Podsakoff et al., 2009).

H5: Organizational Citizenship Behavior mediates the relationship between leadership style and employee performance

Conceptual Framework of the study

Figure 1: Conceptual Framework of the study

Population, Sample and Sampling Technique

The present study is about a selected company in IT industry, located in Colombo, which serves as the population for research. As per the active list of employees in the organization, there are 290 employees currently working in the organization and all of them represent the population to conduct this study. The current study applied the Strata method for data collection which helps to represent all subgroups assured. The sample size is 165 according to the Morgan Table.

Measurement Scales

The dependent variable: Employee performance was assessed using the measurement scale developed by Pinto et al., 2023 and with 9 items. All the items are anchored on a five-point Likert scale where 1 = strongly agree and 5 = strongly disagree. Sample items include: “You always do your work on time”, ‘The quality of your work is always satisfactory”, ‘Your efficiency always exceeds the average of other employees”, “The work produced meets the formal performance requirements of the organization”.

Independent variable: The scale of Leadership Style was adopted by Priyashantha, K.G. & WIN, KHIN (2016). It is a 23-items. A five-point Likert scale [ranging from 1 (strongly agree) to 5 (strongly disagree)] was used to measure the scale items. Sample items include: “My supervisor closely monitors employees to ensure that they are performing correctly”, “My supervisor gives a reward or punishment in order to motivate and improve performance”, “My supervisor does not readily accept new ideas”, “My supervisor retains decision making authority within the department”.

Independent variable: The scale of Work Environment was adopted by Pinto et al., 2023 with 8 items. A five-point Likert scale [ranging from 1 (strongly agree) to 5 (strongly disagree)] was used to measure the scale items. Sample items include: “Conducive Work Environment greatly supports the smooth execution of work”, “You work in a comfortable space”, “You build good working relationships with leaders and with fellow coworkers”, “You are given the opportunity to excel in work open to fellow coworkers”.

Mediating Variable: Work Motivation was assessed using the measurement scale developed by Irenes, T.S. et al., 2020 with 6 items. Sample items include: “I enjoy that challenge difficult”, “I want to know How progress Which I achieved when currently finish”, “I Like set objective and reach objective realistic”. The scale of Organizational Citizenship Behavior was adopted from Lavena, Ika & Lo, Singmin. (2020) with 10 items. A five-point Likert scale ranging from 1 (strongly disagree) to 5 (strongly agree) was used to measure the scale items. Sample items include: “The willingness of employees to help colleagues who are busy”, “Willingness of employees to replace the duties of other employees when they are unable to carry out tasks”, “Join meetings that are not mandated but are considered important”, “Always follow the changes that exist”.

Research Design

This study adheres to the positivist philosophy, which emphasizes the generation of knowledge. A research design can be categorized into two types: quantitative and qualitative. Quantitative research mainly consists of numbers and statistics. The current study used a quantitative technique to confirm the hypotheses that were developed.  It facilitates quantitative analytical data for the survey which can be used for both factual and fictitious statistics. These surveys’ data may also be used to provide potential justifications for unusual connections between variables. It is unique in that it has the potential to produce results that accurately represent the entire population at a lower cost than data collection for the entire population. This is a prevalent method for collecting data to address research problem.

Data Analysis and Results

Reliability and Validity Statistics

 Table 01: Reliability and Validity Statistics

As depicted in table 1, Cronbach alpha of internal consistency coefficients of the two independent variables (Leadership Style, Work Environment), dependent variable (Employee Performance) and two mediating variables (Work Motivation, Organizational Citizenship Behavior ) are greater than 0.7 indicating that multi-item measurement scales are reliable enough and have no bias. According to the KMO coefficients and the respective sig. values for five variables given in the table 1, the study sample seems statistically adequate to perform an EFA to assess the construct validity.

Summary of Correlation Analysis

Table 02: Results of the correlation analysis

Source: Author ,2024 Simple Regression Analysis

 The beta  coefficient  indicates  the  strength  and  direction  of  the  relationship,  the t-statistic  assesses  the significance  of  the  relationship,  and  the  low  p-value  (0.000)  suggests  that  the  relationship  is  statistically significant.

Mediator Analysis

To test the mediation effect of work motivation on relationship between leadership style and employee performance, an online Sobel calculation was used. Results are given in figure 2.

Figure 2: Mediator Analysis (H3)

Source: Analyzed data, 2024

According to figure 6, as the p- value of the Sobel test statistic 0.01047058 is less than 0.05 and indicates that the result is statistically significant. Hence, work motivation has depicted a significant mediation impact on leadership style and employee performance. Further as both direct and the indirect paths of the IV – DV relationship are significant, work motivation could be partial mediator. Accordingly, mediator analysis, H3 is accepted statistically confirming that work motivation mediates the relationship between leadership style and employee performance.

To test the mediation effect of work motivation on relationship between work environment and employee performance, an online Sobel calculation was used. Results are given in figure 3.

Figure 3: Mediator Analysis (H4)

Source: Analyzed data, 2024

According to figure 3, as the p- value of the Sobel test statistic 0.02282613 is less than 0.05 and indicates that the result is statistically significant. Hence, work motivation has depicted a significant mediation impact on  work environment and employee performance. Further as both direct and the indirect paths of the IV – DV relationship are significant, work motivation could be partial mediator. Accordingly, mediator analysis, H4 is accepted statistically confirming that work motivation mediates the relationship between work environment and employee performance.

To test the mediation effect of work motivation on relationship between work environment and employee performance, an online Sobel calculation was used. Results are given in figure 4.

Figure 4: Mediator Analysis (H5)

Source: Analyzed data, 2024

According to figure 4, as the p- value of the Sobel test statistic 0.00014759 is extremely less than 0.05 and indicates that the result is statistically significant. Hence, OCB has depicted a significant mediation impact on leadership style and employee performance. Further as both direct and the indirect paths of the IV – DV relationship are significant, OCB could be partial mediator. Accordingly, mediator analysis, H5 is accepted statistically confirming that OCB mediates the relationship between leadership style and employee performance.

FINDINGS AND DISCUSSION

Leadership Style on Employee Performance

The current study has identified that there is a positive impact of Leadership Style on Employee Performance ( r =0.694 and Sig. 2 tailed 0.000).Moreover, a significant impact was found between Leadership Style on Employee Performance (R square 0.481 and sig 0.000). Hence, H1 was accepted which mentioned that there is a significant relationship between Leadership Style and Employee Performance. As well as specific objective one of this study was achieved. Tolu et al. (2021) demonstrate that leadership style positively influences employee performance, as a leader’s approach affects employees’ ability to fulfill their responsibilities.

According to the findings of the current study, when there is a good leadership style within the company, results to increase the employee performance. Therefore, to retain the employees with high performance, the company empowers the employee by developing team spirit, giving adequate and regular feedback, providing guidance through clear supervision, providing leadership training programs, giving authority to work independently.

Work Environment on Employee Performance

This study found out that there is a positive impact of work environment on employee performance (r =0.791and Sig. 2 tailed 0.000) and a significant impact was found between work environment on employee performance (R square 0.626 and sig 0.000). Hence, the second specific objective was achieved in the current study. Moreover, H2 was accepted which mentioned that there is a significant impact of the work environment on employee performance. Research conducted by Ingsih et al. (2021) and Michael et al. (2022) provides evidence that a favorable work environment has a positive impact on the performance of employees. Accordingly, when there is a better work environment within the organization, it will result to increase the performance among the employees. Hence, to enhance the performance of the employees, management has to take necessary actions to create favorable work environment by improving physical workspace, promoting open communication, cultivating trust and respect, Build a Supportive Team Environment.

Leadership Style and Employee Performance with the mediating effect of Work Motivation

Research findings of Mavhungu & Bussin (2017), state that motivation plays a significant role in mediating the relationship between leadership style and performance, as subordinates consistently experience the effects of leadership style directly. Accordingly, to test the mediation effect of work motivation between leadership style and employee performance, an online Sobel calculation was used. As the p value of the Sobel test statistic 0.01047058 is less than 0.05, Sobel test statistically accepted. Therefore, H3 was accepted, which mentioned that there is a significant impact of leadership style on employee performance with the mediating effect of work motivation. According to the finding of the current study, work motivation has a significant mediation impact on the relationship between leadership style and employee performance.

Guterresa et al. (2020) found that an effective leadership style encourages employees to be motivated, which subsequently enhances optimal work performance. Effective support can generate motivation among employees. An enhancement in work motivation, resulting from a reasonable and suitable leadership style, will enhance employee performance. Management can take necessary actions to increase employee performance through motivation by promoting autonomy, leveraging recognition and rewards, providing career growth opportunity, investing training and development.

Work Environment and Employee Performance with the mediating effect of work motivation

The results showed that the work environment mediates the significant relationship between the work environment and employee performance. In order to analyze the mediation effect of work motivation, Sobel test was used. As the p value (p – 0.02282613) is less than 0.05, H4 is statistically accepted which mentioned that there is a significant impact work environment on employee performance with the mediating effect of work motivation. According to the research conducted by Jayaweera (2015) also states that organizations that emphasize motivation and performance will enhance their operations by consistently enhancing their work environments. It is in line with the research of Tolu et al. (2021) state that a conductive work environment will result in higher motivation, that will lead to an increase in employee performance.

Leadership Style and Employee Performance with the mediating effect of OCB

The result show that OCB mediates the relationship between leadership style and employee performance. To analyze the mediation effect of OCB, Sobel test was used. As the p value (p – 0.00014759) is less than 0.05, H5 is statistically accepted which mentioned that there is a significant impact of leadership style on employee performance with the mediating effect of OCB. Leaders who encourage OCB create a ripple effect: employees feel more motivated to help their colleagues, contribute to the organizational culture, and engage in behaviors that improve overall performance (Podsakoff et al., 2009). Also, Anggita, Gede & Dharmanegara (2018) shows that the leadership style and OCB significantly affects Work Stress and Employee Performance. In order to enhance employee performance, organization can create the work force with OCB by promoting workplace ethics, Recognizing and rewarding who demonstrate OCB, incorporating OCB related behaviors and values to the company mission statement.

Practical Implications

The findings and the conclusion of this study present the good leadership style and conductive work environment affects employee performance. In order to increase employee performance and to retain employees within the company, the findings may help in enhancing corporate practices by offering insights into leaders’ awareness and comprehension of retention strategies for talented employees and the enhancement of employee performance. Recruiting top talent is merely the beginning. Keeping your employees performing at the highest level plays a large role in a company’s long-term success. Minor matters may turn into major issues, adversely affecting employee performance. Nonetheless, the organization can continue to maintain a productive and performance-driven workplace by consistently evaluating employee performance and implementing performance enhancement strategies to ensure that your employees remain engaged and motivated in their positions. By adopting managerial practices such as equitable incentives, attention to employee well-being, and fostering conducive working conditions, the organization should cultivate an environment that motivates employees to enhance their performance. Managers and supervisors should be flexible and build a good relationship among team members, avoid placing undue stress on their employees, and address employee grievances in a timely manner.

Managers and employee relations practitioners in a company are actively engaged in formulating and executing organizational policies and procedures aimed at enhancing employee performance. By promoting autonomy, leveraging recognition and rewards, providing career growth opportunities that motivate the employees which result in enhancement of employee performance and employee retention. Providing training for employees on stress management, maintaining a positive attitude, and time management are all ways in which the organization can encourage Organizational Citizenship Behaviour in the workplace. It is necessary for the workplace to provide a supportive and healthy working environment in order to develop organizational citizenship behavior among all employees. To ensure that supervisors are able to treat their subordinates in a respectful manner with dignity also company need to build a culture in which employees have mutual respect for each other. These findings might contribute to our growing understanding of the impact of leadership style and work environment positively affects to the employee performance. The results of this study agreed with other previous studies. By providing those implications to enhance the performance of the employees, company able to retain quality, skillful and effective.

Limitations

Even though the current study has presented considerable implications based on the study, some limitations that the researcher faced while carrying out the study. The primary goal of the study was to identify the impact of leadership style and work environment on employee performance in the above-mentioned company. Hence, the first limitation is that the current study is only relevant to one organization which is in the IT industry. This reason has resulted in the study is to be more subjective and applicable for one organization. Further, this research only used the questionnaire method for data collection. It is not sufficient to gather more accurate information. Current study considered all the other factors to remain constant. However, the results of the study may be influenced by other factors such as training, Organizational support, compensation and other external factors.

Directions for future researchers

Despite the coherent limitations, the current study presents a few directions for future researchers. In order to obtain more up-to-date insights into the real corporate environment, a qualitative approach might also be utilized to reframe the study. For example, an in-depth interview could be used to conduct the study. Additionally, the researcher recommends that future researchers broaden the scope of the independent variables by incorporating dimensions (if any). Further, researcher suggest investigating the mediating role of variables such as organizational support, compensation and other external factors as mentioned in the limitations section. Additionally, future researchers can use this model to different industrial context and geographical context. These factors can be addressed in future research to resolve the limitations outlined in this study, resulting in more reliable and useful conclusions.

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