Transformational Leadership and Employee Performance in the Private Healthcare Sector: A Case of Avenue Healthcare, Nairobi County, Kenya

Transformational Leadership and Employee Performance in the Private Healthcare Sector: A Case of Avenue Healthcare, Nairobi County, Kenya

Angela Kaberere, Dr. Emilio Kariuki

St. Pauls University, Nairobi, Kenya

DOI: https://dx.doi.org/10.47772/IJRISS.2025.907000211

Received: 04 July 2025; Accepted: 10 July 2025; Published: 08 August 2025

ABSTRACT

The purpose of the study was to investigate the effectiveness of transformational leadership on healthcare employee performance in Nairobi County, Kenya. It is guided by the following specific objectives include; to assess the workplace performance among employees in Nairobi County, Kenya; to determine the effects of idealized influence on employee performance; to explore the effects of inspirational motivation on employee performance; to determine the effects of intellectual stimulation on employee performance and to identify the individualized considerations on employee performance. This study adopted a cross-sectional descriptive design. The study involved 134 participants selected using stratified and simple random sampling methods. The primary instrument for collecting data for the study was the questionnaire. The study established that the performance of health employees was greatly influenced by how the leaders exerted positive influence on them at the workplace. The study was able to establish that in a majority of the employees, they felt that their leaders were inspirational and tended to drive their zeal towards a certain goal and this positively influences their performance. Lastly, the study found out that in a majority of the cases, the employees felt that they were given individualized consideration and this helped to improve their morale for work hence performance.

Keywords: Transformational Leadership, Employee Performance, Leadership in healthcare, Nairobi County

INTRODUCTION

Leadership style has a substantial effect on employee performance because it is the driving force of how they achieve organizational goals..Employee performance is positively influenced by effective leadership because when there is effective leadership, individuals reach their full potential in organizations where leaders create a favorable environment by coaching, monitoring, offering guidance, supporting, and rewarding appropriately. Therefore, the key role of leadership is to enable an organization to realize its objectives, hence the failure or success of an organization is majorly determined by the leadership style.

Transformational leadership can be defined as a leadership that transforms followers to rise above their self-interest by altering their morale, ideals, interests, and values, motivating them to perform better than initially expected. This style of leadership has gained a lot of interest in field of leadership and has attracted the interest of practitioners and researchers (. Some past studies have established a positive correlation between work performance and transformational leadership style. However; the studies have not focused on the leadership style, particularly in the health sector. The performance of the health sector is highly dependent on the leadership style adopted because this is a service sector that operates effectively depending on how the leadership mechanisms are effected. Currently, performance deficits characterized by medical errors and poor service delivery have become common in the healthcare sector pointing towards a leadership deficit in the health sector. Therefore, the researcher made an effort to fill these gaps by determining the effectiveness of transformational leadership on employee performance at avenue health care in Nairobi County, Kenya.

Globally, there is a leadership concern in both the public and private service which comes about as a result of increased demand by clients to receive better services. This can be addressed aptly by ensuring that the leadership in these organizations is streamlined (Mohamed, et al., 2018). On the other hand, the lifting of international business restrictions/barriers has given rise to unparalleled competition as local players now have to compete with international rivals. This emerging challenge in the industry and operational environment raises the appetite for efficiency and effectiveness among institutions in order to survive (Pawirosumarto, et al., 2019). In Kenya, the health sector has been characterized by performance deficits among employees occasioned by an array of factors ranging from corruption, unprofessionalism, medical errors and poor quality service delivery mostly due to gaps in leadership. This calls for rigorous research through clearly defining the measure of employee performance and development of appropriate instruments to assess and validate the underlying factors. However, employees’ performance has been evaluated before in different business sectors, leaving behind the gap for a specific sector’s evaluation including the health sector.

Transformational leadership is being recommended as a model of leading people by encouraging organizational members to work independently and with full initiatives towards achieving organizational goals (Khan, et al.,2020). However, very few studies have focused on its role in healthcare organization. The health sector in Kenya has been criticized, both at the national and county levels. For example, the sector has witnessed many scandals in the procurement and purchase of health equipment by national authorities such as KEMSA (Kenya Medical Supplies Authority) as well as mismanagement of health sector by County Governments that has occasioned strikes by medical workers. At the core of this lies the leadership styles that have been adopted to manage the sector. It therefore becomes of essence to investigate how transformational leadership affects employee performance in the sector.

LITERATURE REVIEW

This section presents the literature on transformational leadership as well as the theoretical grounding that ushers in this study. This is done in relation to the research questions. At the end, it establishes a research gap that the study sought to fill.

Transformational Leadership Theory

The study will utilize the Transformational Leadership Theory. This theory was first introduced by James McGregor Burns in 1978. He first introduced this approach when studying political leaders, but this was later broadened to study organizations. The theory explains that leaders induce higher degrees of extra effort, effectiveness, and satisfaction in followers when they apply leadership behaviors related to the four dimensions of transformational leadership, namely idealized influence, inspirational motivation, individualized consideration, and intellectual stimulation (Mohamed, et al., 2018).The theory argues that Transformational leaders ensure the faith, effectiveness and loyalty of their followers by establishing relationships based on mutual trust (Başar et al., 2021). It is based on the assumption that people have immense potential and can be successful if they are given the vision and support from highly engaging, positive and inspiring leaders.

Equity Theory

Equity Theory, developed by social psychologist J. Stacy Adams in 1963, states that in a work context, people make assessments between themselves and others in terms of what they invest in their work (inputs) and what outcomes they receive from it. The theory focuses on people’s feelings on how fairly they have been treated in comparison with the treatment received by others. They place a weighting on the various inputs and outcomes according to how they place their importance. When there is inequity of ratios, the person experiences a sense of inequity. A feeling of inequity causes tension, which results in an unpleasant experience. The degree of perceived inequity determines the level of tension at which it determines the strength of motivation.

Empirical Review

This section reviews the literature based on the focus of the study as defined by the objectives and how each of them relate to employee performance.

Leadership and performance

According to Robbin (2003), leadership is an ability to influence a group towards the attainment or achievement of goals. As such, Morrison (2007) avers that leadership is attained through the right training and transfers of skills rather than an inborn ability. In fact, leadership entails constantly practicing the correct skills. Blagg (2014) further avers that 90% of leaders are made. Good leadership is an essential ingredient towards the improvement of an organizational performance. Blagg (2014) notes that effective leadership is not based on being clever but primarily on being consistent. Leaders usually put their organizations on a high performing platform that produces consistent and high results because of being consistent. Ability is that one of being able to anticipate and deal with change throughout their lives. As Morrison (2007) states, good leaders tend to create new ideas and gain support from those they lead.

A leadership vision must be transformative and able to traverse every aspect of business. Kantabutra & Avery (2010) postulate that the leadership vision must be able to resonate and capture the hearts and the minds of all employees thereby motivating and inspiring them to give their optimum that would ensure high performance. They argue that leaders with strong, viable and effective visions are able to energize the whole organization to stay on course towards the realization of the purpose for which an organization exists. A powerful leadership vision must have the ability to shape the organizational behavioral pattern towards realizing its purpose (Haque, TitiAmayah and Liu, 2016).

While studies have been conducted in to analyze employee performance and its influencing factors varied context in Kenya, studies that focus on the health sector are limited. This information is critical for addressing fundamental deficits currently being witnessed in health service delivery.

METHODOLOGY

Research design

This study adopted a cross-sectional descriptive design. This allowed the investigator to measure the outcome and the exposures among the study participants at the same time. In this study, data was collected at a single point in time to determine the effect of transformational leadership on employee performance in Nairobi County, Kenya. Moreover, the design was appropriate in establishing the association between the different transformational leadership dimensions and the employees’ job performance.

Population and Sampling

The study involved 134 participants selected using stratified and simple random sampling methods. This involved the medical healthcare workers in the selected health facilities within Nairobi County. They were selected based on the fact that they understand well the leadership style in the facilities owing to their work.

Instruments

The primary instrument for collecting data for the study was the questionnaire. This was constructed based on the research questions. It had both closed ended and open ended questions. Whereas the closed ended questions were aimed at eliciting specific data, the open ended questions allowed the respondents to elaborate their answers. They were administered using the ‘drop and pick’ method.

Validity and Reliability

Validity of the study was guaranteed by ensuring that the research instruments were constructed so as to measure the research questions and objectives. Since reliability borders more on steadiness, fidelity or stability of a test, the researcher evaluated the reliability of the questionnaire to determine its consistency by using the test-retest method.

Data analysis and presentation

The study used both descriptive and inferential statistics for analysis. Frequencies, percentages, means and standard deviations were used to describe the study population while Chi-square test of independence and logistic regression were used to establish the association between the study variables. The study also employed the use of Binary and multivariate logistic regression to deal with dependent and independent variables. To control for effect modification and confounding variables, variables with a p-value less than 0.2 in the bivariate analysis were fitted into the multivariable logistic regression analysis. The multivariate logistic regression was used to identify the factors associated with the employee’s performance. In the analysis, odds ratio with a 95% confidence interval was used to show the strength of the associations. The criterion for statistical significance was set at a P-value of less than 0.05.

Ethical Considerations

The study followed the ethical procedures that are required. First, authorization was sought from the NACOSTI (National Council for Science Technology and Innovation) through a research permit. At the same time, permission was sought from the County Health Department before going to the field. A written consent was also obtained from each of the participants in the study. The respondents were assured of their anonymity and confidentiality. All responses were not shared to third parties.

FINDINGS AND DISCUSSION

A total of 134 respondents participated in the study. This chapter presents the results and discussion of the study.

Demographic characteristics of the study respondents

The majority 68.7% of the study respondents was females and in terms of age group, 42.5% were aged between 31-40 years. The study also found that 76.1% of the study respondents were had worked for less than 10 years, majority,43.3% of the study respondents had a diploma level qualification, 28.4% had certificate and only8.2% of the participants had a master’s qualification. Furthermore, and as reflected in Table 1, the majority 34.3% of the study respondents were patients’ assistants and 32.8% were nurses. These finding suggest that that workplaces engage workers based on different demographic and economic factors such as age, sex, educational qualification and designation.

Table 1: Demographic characteristics of the study respondents

Findings

The study was guided by four objectives namely: Effects of idealized influence on employee performance, Effects of inspiration motivation on employee performance, Effects of intellectual stimulation on employee performance and Effects of individualized considerations on employee performance.

Effect of idealized influence on employee performance

Idealized influence is used to denote managers who are exemplary role models. These types of managers can be trusted and respected by associates to make good decisions for the organization. The effects of idealized influence on employee performance were measured using three indicators included: I put extra effort at work because my leader instills pride in me by acting as my role model; I can be productive in my work because my leader is a good role model and can emulate them; I am committed to my work because I can fully trust my leader and my leader influence how I view my work.

Employee perceptions on the effect of idealized influence on employee performance

Table 6: Employee perceptions on the effect of idealized influence on employee performance

Results presented in the Table 6 show that the majority (n=46, 34.3%) of employee’s agreed that they put extra effort at work because their leader instills pride in them by acting as their role model. Nearly one-third (n=33, 24.6%) also strongly agreed that they put extra effort at work because their leader instilled pride in them by acting as their role model. The study found out that most (n=48, 35.8%) of the study participants agreed that they can be productive because their leader was a good role model who can be emulated. Forty three participants (32.1%) strongly agreed while ten (7.5%) disagreed that they can be productive because their leader was a good role model who can be emulated. Furthermore, slightly more than two-thirds agreed (n=53, 39.6%) or strongly agreed (n=38, 28.4%) that they were committed to their work because they fully trusted their leaders. These findings are in line with those of Blagg (2014) which found out that the perceptions of employees regarding the leadership style has a profound influence on their performance. Morrison (2007) also established that when employees perceive the leadership style positively, they are bound to emulate and hence that enhances organizational efficiency.

Employee perceptions on the effect of idealized influence on employee performance category

Respondent’s attitude score was computed based on each idealized influence statement. The results as presented in Table 7.

Table 7: Employee perceptions on the effect of idealized influence on employee performance category

Leaders influence employees view on work

The study also sought to establish if the employees thought that their leader influenced how they viewed their work. More than half (59%) agreed that their leader influenced how they viewed their work except for only 41% who indicated that they were not influenced.

Idealized influence perception

The study revealed that 72.4% of employees had positive perceptions that idealized influence affected their performance while 27.6% had negative perceptions.

Association between idealized influence and employee performance

The study finding showed that there was an association between the perceptions about employee putting extra efforts at work because their leader instilled pride in them and their performance. Those who had negative attitudes that they put extra efforts at work because their leader instilled pride in them was 7.14 likely to perform poorly as compared to those who had positive perceptions. A positive relationship was established between employee’s perception about them being productive at work because their leader was a role model and their performance. Those who had negative perceptions were 10.93 times more likely to perform poorly compared to those who had positive perceptions.

Table 8: Association between idealized influence and employee performance

Table 8 also shows that there was a statistically significant association between the employee’s perception about them being committed at work because they fully trust their leader and their performance. Those who had negative attitudes that they could be committed to work because they fully trust their leader were 11.2 time more likely to perform poorly as compared to those who had positive attitudes. Several other studies have found that idealized influence significantly predict employee job performance (Al-Thawabiya, et al., 2023).

Effects of inspirational motivation on employee performance

Employee perceptions on the effect of inspirational motivation on employee performance

Table 9: Employee perceptions on the effect of inspirational motivation on employee performance

As reflected in Table 9, the majority (n=35, 26.1%) of the employee’s just agreed that they perform well because their leader breaks down a compelling vision for the future. In addition, about 74 respondents (62.1%) just agreed and agreed strongly that they perform satisfactorily because their leader is enthusiastic about what need to be done. The largest proportion (n=92, 68.7%) of the study respondents further agreed that their leader inspired enough confidence in them to perform beyond their expectations

Employee perceptions on the effect of inspirational influence on employee performance category

The results as presented in Table 10 Show that the majority (n=69, 51.5%) of the study participants had a positive perception that they perform well their leader breaks down a compelling vision for the future. Nearly two-thirds (n=84, 62.7%) believed that they perform satisfactorily because their leader is enthusiastic about what needs to be done. Furthermore, most (n=92, 68.7%) of the respondents had positive attitudes that their leader inspired enough confidence in them to perform beyond the expectations.

Table 10: Employee perceptions on the effect of inspirational motivation on employee performance category

Leaders inspiration to work towards a common goal

56.7% of the respondents said that their leaders inspired them towards a common goal. The rest, 43.4% said they were not inspired.

Inspirational motivation perception category

The study revealed that 69.4% of the employees had positive perceptions that inspirational motivation affected their performance. 30.6%had negative perceptions.

Association between inspirational motivation and employee performance

Table 11 shows the findings on the link between inspirational motivation and employee performance.

Table 11: Association between inspirational motivation and employee performance

According to table 11, those who had negative perceptions that they perform well their leader breaks down a compelling vision for the future were 5.89 times more likely to perform poorly compared to those who had positive perceptions. The odds of poor performance were 14.82 among those who had negative perception that they perform satisfactorily because their leader is enthusiastic about what needs to be done. Moreover, those who perceived that their leader did not inspire enough confidence in them to perform beyond the expectations were 9.51 times more likely to perform poorly as compared to those who perceived that their leader inspired enough confidence. Overall, those who had negative perception that inspirational motivation did not influence their performance were 13.19 times more likely to perform poorly as compared to those who had positive perceptions (Table 11). The findings concur with those of Wario (2019) that in an organizational culture where the leader is at the forefront in inspiring the employees, the performance of the organization is likely to be positive as that trait trickles down to the employees.

Effects of intellectual stimulation on employee performance

Employee perceptions on the effect of intellectual stimulation on employee performance

About two-thirds (n=90, 67.2%) of the employees agreed that they perform better because their leader encourages them to tackle problems from different angles. Equally, 69.4% (n=93) of the respondents agreed that they are able to perform their duties because their leader gives them room to be creative. Furthermore, the majority (n=77, 64.9%) of the respondents agreed that they were able put extra effort in their work because their leader offered them new ways of looking at confusing/ puzzling things (Table 12).

Table 12: Employee perceptions on the effect of intellectual stimulation on employee performance

Employee perceptions on the effect of intellectual stimulation on employee performance category

The study respondent’s attitude score was computed based on each intellectual stimulation statement. All the respondents who got the correct response in each statement were given a score of 1 which denoted a positive perception while those who scored wrongly scored a 0 which denoted a negative perception. From table 13, slightly above two-thirds (n=90, 67.2%) of the respondents indicated that they were able to perform better because their leader encouraged them to tackle problems from different angles. The study further observed that the majority (n=93, 69.4%) of study participants believed that they were able to perform their duties because their leader gave them room to be creative. In addition, nearly two-thirds (n= 87, 64.9%) indicated that they put extra effort in their work because their leader offered them new ways of looking at confusing/ puzzling things (Table 13).

Table 13: Employee perceptions on the effect of inspirational motivation on employee performance category

Leaders encouragement to give solutions to problems

Slightly higher than half 55.2% of the study participants indicated that their leader encouraged them to give solutions to problems. Only 44.8% said they were not encouraged by their leaders.

Intellectual stimulation perception category

Overall, 70.9%of employees had positive perceptions that intellectual stimulation affected their performance while 29.1% had negative perceptions. The study present study established that there was a significant relationship between employee’s intellectual stimulation and their performance. Those employees who had negative perceptions on the statement that they were able to perform better because their leader encouraged them to tackle problems from different angles were 10.75 times more likely to perform poorly as compared to those who agreed with the statement. Similar findings were made by Blagg (2014) that for an organization to have a positive organizational culture, the leaders must be able to stimulate the employees intellectually and in so doing, inspire them for better action.

Association between intellectual stimulation and employee performance

Table 14: Association between intellectual stimulation and employee performance

The odds (7.19) of poor performance were also higher among those employees who did not agree that they were able to perform their duties because their leader gave them room to be creative. Similarly, the odds (9.38) of poor performance were higher among those who did not agree with the statement that they put extra effort in their work because their leader offered them new ways of looking at confusing/ puzzling things. Overall, the study observed that those who did not have positive perceptions that intellectual stimulation influenced their performance were 13.81 times more likely to perform poorly as compared to those who had positive perceptions (Table 14). The findings of this study are consistent with those of Magasi (2021) who revealed that intellectual stimulation was positively associated with job performance of banking sector employees.

Effects of individualized considerations on employee performance

The study also investigated the influence of individualized consideration on employee performance. Three indicators were considered by the study; my leader respects and celebrate individual contributions, my leader gives personal attention to individual employees, my leader spends time teaching and coaching me and my leader understand how I work best as an individual

Employee perceptions on the effect of individualized considerations on employee performance

The study revealed that more than half (n=84, 57.2%) of the respondents agreed that their leaders respected and celebrated their contribution in their organization. Similarly, almost two thirds (63.4%) reported that that their leaders gave them personal attention. In addition, the majority (n=106, 79.1%) of the study participants indicated that their leaders spent time teaching and coaching them (see Table 15)

Table 15: Employee perceptions on the effect of individualized considerations on employee performance

Employee perceptions on the effect of individualized considerations on employee performance category

Table 16 shows that the more than half of the participants had positive perception that their leaders had individualized consideration in all the three indicators considered by the study which affected their performance.

Table 16: Employee perceptions on the effect of individual considerations on employee performance category

Leaders understand how employee work best as individuals

The study also sought to establish whether their leader understand how they work best as an individuals. About 56% of the respondents believed that their leaders understood how they work best as an individual compared to only 43.3% who disagreed. As to Individual considerations perception, the study found that 59.7% of the respondents had positive perceptions that individual considerations affected their performance, while 40.3% had negative perceptions.

Association between Individual considerations and employee performance

Table 17 shows that those who had negative perception that their leaders respected and celebrated their contribution were 4.47 times more likely to perform poorly as compared to those who had positive perception. Similarly, those who had negative attitude that their leaders gave them personal attention were 7.39 times more likely to perform poorly compared to those who had positive perception. Those who had negative perception that their leaders spent time teaching and coaching them were 6.50 times more likely to perform poorly compared to those who had positive perceptions. Overall, the study established that those employees who had negative perception that individualized considerations had an effect on employee’s performance were 4.02 times more likely to perform poorly compared to those who had positive perceptions.

Table 17: Association between Individual considerations and employee performance

The study reveals that those employees who had received individualized consideration from their leaders performed better than those who had not received. This supports the findings of Bahagia and Astuti (2019)who also foundthat individualized consideration was strongly correlated with staff performance.

Factors associated with employee performance

Table 18 shows that the odds of better performance were 1.23 times higher among those employees who had positive perceptions about idealized influence (AOR= 1.23, 95% C.I, 0.19-7.92). In addition, the odds of good performance were 4.5 times higher among those employees who had positive perceptions about inspirational motivation compared to those who had negative perceptions (AOR= 4.51, 95% C.I, 1.11-8.46). Furthermore, the odds (5.6) of better performance was observed among those who had positive perceptions about intellectual stimulation compared to those who had negative perceptions (AOR= 5.63, 95% C.I, 2.44-9.13). Additionally, those employees who had positive perception about individualized considerations were 6.1 times more likely to perform better as compared to those who had negative attitudes (AOR= 6.11, 95% C.I, 1.19-9..37). The findings prove that transformational leadership greatly influences employee’s performance. Idealized influence, inspirational motivation, intellectual stimulation and individualized consideration are critical components of transformational leadership that significantly impacts on employee’s job performance. These finding confirm the findings of previous studies such as Khan et al., (2020). Therefore, it can be stated that organizational leaders need to have transformational attributes so that they can inspire employees to achieve good job performance at their workplaces. This is in line with the findings of Masara (2022), Kanabutra and Avery (2010) that organizations where leaders exhibit transformational leadership tend to perform better than those where leaders are not transformational.

Table 18: Factors associated with employee performance

AOR-Adjusted Odds Ratio, reference category-poor performance, *statistically significant

CONCLUSION AND RECOMMENDATIONS

Summary

The study sought to investigate the effects of transformational leadership on the performance of employees in the health sector. It was guided by four objectives. Regarding the effects of idealized influence on employee performance, the study established that the performance of health employees was greatly influenced by how the leaders exerted positive influence on them at the workplace. As to the effects of inspirational motivation, the study was able to establish that in a majority of the employees, they felt that their leaders were inspirational and tended to drive their zeal towards a certain goal and this positively influences their performance. As to the effects of intellectual stimulation, the study established that it happens only slightly above average but the employees were of the opinion that if well intellectually stimulated, their performance is likely to improve. Lastly, regarding the effect of individualized considerations on employee performance, the study found out that in a majority of the cases, the employees felt that they were given individualized consideration and this helped to improve their morale for work hence performance.

Conclusions and Recommendations

The study concludes that the four dimensions of transformational leadership (idealized influence, intellectual stimulation, inspirational motivation and individualized consideration) significantly affect performance of employees. The study also concludes that inspirational motivation is important in encouraging employee performance. Intellectual stimulation is equally critical for employee performance since it allows leader to motivate their followers to be imaginative and innovative in dealing with challenges in new ways. The study calls for the need to adopt transformational style in order to improve employee performance and productivity of organizations. The study also advocates for delegation of task by leaders and mentorship.

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