Transformational Leadership and Leader Member Exchange: An empirical examination of Knowledge Management Practices and Organizational Performance through Employee Involvement

Abstract

Purpose: Human resource behaviour tends to play a vital role in organizational overall performance. The study incorporates two of the most prominent behaviours of leadership and examine their influence on organizational performance and knowledge management practices through employee involvement. Method: A sample of 398 participants was collected from different industries from services sector through survey questionnaire. Descriptive statistics were carried out to find means, standard deviation, frequency scores and then tested for model fitness by comparing alternative models through confirmatory factor analysis (CFA). In order to see the direction of hypotheses, we carried out Pearson Correlations analysis. For testing hypotheses PROCESS macro technique was used. Results: The results indicate that (1) the major influence on knowledge management practices and organizational performance is contributed by employee involvement, further transformational leadership has more impact on employee involvement, knowledge management practices and organizational performance as compared to leader member exchange; (2) employee involvement mediates the relationship between leadership behaviours and knowledge management practices as well as organizational performance. Conclusion: This study concludes that better relationship between manager and employee is necessary for the individual and organizational betterment and it occurs only when individuals are comfortable with their mangers. Keywords: Transformational Leadership (TL), Leader Member Exchange (LMX), Employee Involvement (EI), Knowledge Management Practices (KMP), Organizational Performance (OP) Paper Type: Research Paper