The moderating effect of cultural intelligence on the relationship of transformational and transactional leadership styles and job performance

Abstract

Job performance and effective leadership are important factors for success of any organization. Effective leadership is critical to ensure that organization and employee work effectively to achieve high levels of performance. Transformational and transactional leadership style is found to be the most appropriate style of leadership to enhance employee job performance, and in a multicultural environment can lead to enhanced cultural intelligence. Organization cultural intelligence is a tool that can increase an individual’s ability to deal effectively with people from different cultural backgrounds. It raises the level of employee’s job performance by detecting and assimilating reason, and act on cultural cues appropriately in situations characterized by cultural diversity. In Malaysia’s multi-cultural diversity, the challenges for nurses are that they must be open to interact and have interpersonal relationships, and build connections with colleagues from different cultural backgrounds. Despite the popularity of cultural intelligence, previous studies have not focused much on the moderating factor between cultural intelligence, and transformational and transactional leadership style and job performance. Thus, study identified the leadership style (transformational and transactional) needed to improve nurses’ job performance in hospitals. A model to explain how cultural intelligence moderates the relationship between transformational and transactional and job performance was also developed. The Multifactor Leadership Questionnaire (MLQ) was used to measure the leadership style, and self-performance appraisal questionnaire for job performance and CQS questionnaire for cultural intelligence were used. Based on simple random sampling, 255 nurses from two public hospitals in Johor Bahru, Malaysia participated in the study. Structural Equation Modeling (SEM) with AMOS (ver.22) was used for data analysis. The findings indicated that a significant relationship exists between leadership style and job performance. Besides that, cultural intelligence plays a significant role as a moderator in the relationship between transformational and transactional leadership style and job performance. The results highlighted that transformational and transactional, and cultural intelligence are essential in improving nurses’ job performance. Based on the findings, leaders in the healthcare organizations should consider cultural intelligence to reduce workplace isolation among nurses. The findings of this study can be used to facilitate administrators in their planning to improve nurses’ job performance. Finally, the model developed can be used as the basis for future research.