Revisiting the relationship between transformational leadership and employee psychological empowerment: A more holistic view using organisational culture

Abstract

Employee psychological empowerment has become an essential determinant of overall organisational performance. This is mainly caused by business organisations competing on a very detailed level to drive their advantageous position on their competitors. Transformational leadership (i.e. idealised influence, inspirational motivation, intellectual stimulation, individual consideration) is considered as a core motivator to the predictors of employee psychological empowerment (i.e. meaning, self-determination). However, research is still scarce about how this relationship can be optimised; by whom it should be led and within which organisational environment it provides more effectiveness. This paper aims to examine the mediating role of organisational culture in the relationships between transformational leadership practices and behaviours and the level of employee psychological empowerment. To collect the research data, an online questionnaire was developed and distributed on a random sample of 600 employees from several Jordanian five-star hotels. This resulted in 201 fully answered questionnaires that were then validated and analysed using Analysis of a Moment Structures (AMOS) software. The empirical analysis has shown that transformational leadership is positively connected to employee psychological empowerment, with a significant positive mediation effect of organisational culture on the relationship between both constructs. The research concluded by explaining how organisations with the right ethics, values, beliefs, attitudes and norms provide a natural environment for transformational leaders to empower employees to perform their work duties with a sense of responsibility, autonomy, trust and confidence.

Keywords:

• transformational leadership
• employee psychological empowerment
• leader–employee relationship
• organisational culture
• employee performance outcomes

PUBLIC INTEREST STATEMENT

Employee psychological empowerment is seen as a critical determinant of organizational performance. As businesses strongly compete to gain an edge over their competitors, transformational leadership behaviours (i.e. idealized influence, inspirational motivation, intellectual stimulation, individual consideration) emerge as a key driver of psychological empowerment (i.e. meaning, self-determination). However, there is limited research on how to optimize this relationship, including the ideal context for its effectiveness. This research paper aims to fill this gap by exploring the mediating role of organizational culture in the relationship between transformational style and employee psychological empowerment. The statistical analysis presents a positive correlation between transformational leadership and employee psychological empowerment, with organizational culture having a significant mediating impact. The research concludes that organizations with ethical beliefs, values and norms offer a natural environment for transformational leaders to empower employees through fostering a sense of responsibility, autonomy, trust, and confidence in their work.

1. Introduction

Employee psychological empowerment (EPE) is conceptualised as a primary outcome of leadership (Schermuly & Meyer, 2020). Organisations are sensitive to the performance of employees; while well-empowered employees allow them to succeed, weak employees are detrimental to their planned progress (Narayana, 2017). It is therefore critical to promote employees to pursue their novel tasks and become independent in order to improve organisational effectiveness caused by enhanced service standards, such as quick response time and high customer satisfaction (Chiang & Jang, 2008).

Transformational leadership (TL) can be described as a leadership style that enables employees to manage their ego by revising their morale, beliefs and values, pushing them to efficiently perform (Buil et al., 2019). Transformational leaders (TLs) can boost the intrinsic value of effort through their ability to inspire; they focus on effort and not only the outcome (Pathak & Srivastava, 2017). TLs also assist employees to perceive the organisational objectives as more comfortable with their self-concept by linking them to their own career and learning goals. Acting to achieve these benefits is hence critical for employees to work meaningfully by being aware of the management expectations from their roles (Mufti et al., 2020; Sutherland et al., 2020).

Although literature has considered TL as a core determinant of employee performance outcomes (Lok & Crawford, 2004; Muenjohn & McMurray, 2017), it lacks clarifying how, by whom and within what nature of organisational culture (OC) it must be employed to properly empower employees (Conrad, 2022; Nguyen & Doan, 2021). This paper examines the interrelationship between TL, EPE and OC to provide scholars, managers and decision-makers with a better understanding of the most suitable leadership practices and behaviours to achieve both the personal expectations of employees and the strategic objectives of organisations. The paper also explains how securing a suitable organisational culture allows leaders with transformational traits to empower employees to cope with modern market dynamics. The paper seeks to answer the following research questions:

1. How does TL affect EPE within a specific OC?

2. How can managers and decision-makers employ their TL practices and behaviours to achieve better employee and organisational outcomes?

Reviewing the literature on TL and EPE allowed developing four hypotheses related to idealised influence, inspirational motivation, intellectual stimulation and individualised consideration, which are then quantitively investigated within the Jordanian hospitality industry, leading to presenting the results, discussion, conclusions and implications.

2. Literature review

This section reviews the existing literature related to the research topic, ending with introducing a theoretical framework that guides the empirical research effort.

2.1. Employee psychological empowerment

Psychological empowerment has long been formulated and assessed based on meaning, self-determination, competence and impact (Spreitzer, 1995; Thomas & Velthouse, 1990). Meaning is the linkage between the demand of the role of an employee and her/his core beliefs and values. Self-determination refers to the perceived freedom of an employee to choose how to perform her/his role (Maqableh et al., 2022). Competence is the ability of an employee to perceive and acquire the capability needed for completing her/his work tasks. Impact is the awareness of an employee of the preferable outcomes that the organisation requires as a result of her/his role (Tsai et al., 2021). This paper focuses on the former two constructs (i.e. meaning, self-determination) due to their fit with the hospitality industry (Ibrahim, 2020).

Investing in the development of the meaning and self-determination characteristics of employees can have positive implications on organisational commitment (Alheet et al., 2021). When employees believe that there is a clear purpose behind their work and have control over it, they are likely to show more commitment to their organisations; put differently, they will go the extra mile (Ibrahim, 2020). On the other hand, employees may find it difficult to provide high-quality-customer-oriented services if they lack vision and skills. Organisations are thus encouraged to psychologically empower employees (e.g. understand their work expectations and act accordingly) to secure better performance outcomes (Kang et al., 2020).

Knowing that the desire to improve oneself is universal (Tsai et al., 2021), EPE can help solving various work-related issues by improving self-efficacy and promoting intrinsic drive and self-esteem (Darbha et al., 2021). EPE serves as a rewarding system that allows employees the feel of being valued by the management (Arefin et al., 2019). By maintaining such psychological state, employees are less impacted by negative thoughts or criticism. Having this in mind, it is natural to suggest that psychological empowerment is not only necessary to enhance the overall well-being of employees but also for organisations to better compete, helping them to achieve their strategic objectives.

2.2. Transformational leadership

Leadership is assigned to set a direction for the organisation to succeed (Ekowati et al., 2023). Achieving the objectives of an organisation relies on how the leadership style is used to trigger the competencies of employees (Haryanto et al., 2022). A leadership style is viewed as a series of superior attitudes, behaviours and skills that is decided based on organisational values and employee reliability levels (Maamari & Saheb, 2018). However, no leadership style is universal; they rely on the personal attributes of the leader and their fit to the encountered situation (Buil et al., 2019). A leader should thus be aware of the best style that may increase employee commitment and productivity in the particular organisational environment (Maamari & Saheb, 2018).

Leadership styles and leader–employee interactions are determined by antecedents as employees are unable to disconnect from the elevator of experience (Anggiani, 2020). In that, the focus is not only on time and identity politics but also on how we can learn from current and previous practices, and how future leadership must be performed (Sutherland et al., 2020). Several tendencies were identified in the evolution of leadership research. Whereas early ideas focused on the traits and behaviours of successful leaders, later theories began considering the role of individuals and their setting. Several styles were conceptualised to explain leadership such as transactional and servant leadership styles that encourage open communication and foster a unified sense of purpose (Al Halbusi et al., 2021; Ruiz-Palomino et al., 2022); this research focuses on TL as a critical leadership style that creates a collaborative culture and empower employees to cope with contemporary business dynamics and the ever-changing customer needs (Dinibutun, 2020; Escortell et al., 2020).

TL, as Bass et al. (2003) explained, includes four main components: idealised influence (II), inspirational motivation (IM), intellectual stimulation (IS) and individualised consideration and (IC). The first component is II, which requires leaders to engage in charismatic behaviours for others unify with them. The second is IM and defines the most important organisational objectives to employees. The third is IS and requires urging employees to challenge their assumptions. The fourth is IC, and entails coaching employees and aiding them with their needs. These components of TL generally promote employee performance outcomes such as service quality and recovery and customer loyalty (Chen & Wu, 2020).

2.3. Organisational culture

Culture is the set of essential values that all employees within an organisation understand, believe and implicitly consent to follow (Jahmani et al., 2023; Qawasmeh et al., 2023). It is planned, developed and performed as an underpinning that links employees to the organisational objectives (Bangun et al., 2019). It also represents the essence of the acceptable standards of overall organisational performance such as response time, quality of service and capability to adapt with dynamic circumstances, which are critical for organisations to cope with the rapid market changes (Nazarian et al., 2021).

OC represents drives the image of organisations through four dimensions: internal, external, stability and flexibility (Maqableh et al., 2023). The former two dimensions concern whether an organisation focuses internally on the well-being of employees or externally on the quality of services to achieve its competitive edge (Cameron & Quinn, 2011). The latter two dimensions show whether an organisation relies on the stability of its reputation to provide high-quality settled services or on the flexibility of its dynamic structure to provide modern, agile services. The four dimensions are of similar interest for the purpose of this research; hence, it focuses on organisational culture as one holistic construct.

2.4. Framework and hypotheses

The framework of this research conceptualises the relationship between TL and EPE in light of the mediating role of OC (Figure 1). The framework and related hypotheses develop on the previous research efforts, particularly that of Spreitzer (1995); Pareek (2002); Bass et al. (2003); Pradhan et al. (2017); Nazarian et al. (2021); and Schermuly et al. (2022).

Figure 1. Conceptual Framework.

Literature on leadership widely associates TL with driving change and motivating employees to work towards organisational objectives. TLs motivate employees to work beyond their self-interests for the betterment of a larger group or organisation (Pradhan et al., 2017) through acting as influencers, relationship builders and strategic thinkers (Yavuz, 2020). This contributes to the level of EPE that is considered as a form of intrinsic motivation needed to achieve enhanced organisational effectiveness (Pradhan et al., 2017; Spreitzer, 1995).

Previous research has emphasised the impact of the different components of TL and the meaning and self-determination of employees (Pradhan et al., 2017). As a behavioural construct of TL, II allows systematically transferring the charismatic features of leaders to employees (Chen & Wu, 2020). IC helps in the establishment of positive relationships with employees, thereby enhancing trust and suppressing the feeling of vulnerability and the risk of being disappointed (Afsar et al., 2019). IM is an enabler of job commitment through the communication of shared visions and reinforcement of personal and work values (Nielsen et al., 2008). Lastly, IS encourages employees to be creative and own their work. TL practices and behaviours can thus empower employees by reducing work stresses, raising their innovativeness and personal achievement (Arnold, 2017).

H1:

TL behaviours and practices significantly influence the level of EPE.

TLs assist employees in appreciating the value of their work efforts (Piccolo & Colquitt, 2006). This affects the way employees approach and frame their challenges as opportunities to exhibit their insights and abilities (Dust et al., 2013). TLs also create positive identities and values and link them to a purpose, enabling employee self-concepts to become entangled with the organizational vision. With such culture, employees are led to be passionate and determined (Schermuly & Meyer, 2020). Using TL practices and behaviours promote the loyalty and commitment of employees, creating a positive and supportive culture within the organisation (Johnson, 2009).

H2:

TL behaviours and practices significantly influence the nature of OC.

OC is defined based on eight ethos including openness, confrontation, trust, autonomy, proaction, authenticity, collaboration and experimentation (Pareek, 2002). It is the frame that shapes the relationship between leaders and employees such as the nature of power distance that guides how interactions are effected in an organization (Al-Shibami et al., 2019). In that, a high power distance culture tends to support authoritative and bureaucratic tendencies, impeding TL by limiting free and open communications. On the contrary, a culture that supports low power distance facilitates TL practices and behaviours by decentralising decision-making, promoting open communications and strong relationships (Al-Shibami et al., 2019). OC in turn represent the mediating horizon through which leaders are to communicate and influence employee performance and psychological stance.

H3:

OC mediates the relationship between TL behaviours and practices and the level of EPE.

Employees are sensitive to their organisational standards, values and beliefs (Pasha & Ur Rehman, 2020). These components represent the culture of an organisation, defining the acceptable behaviour that employees can follow to accomplish their job duties (Khuong & Nhu, 2015). A proper OC therefore reflects a positive ethical and compensation atmosphere surrounding employee learning, development and performance, which is directly related to how employees feel about their knowledge, skills and competencies (Kang et al., 2020).

H4:

The nature of OC significantly influences the level of EPE.

The above dialogue provides the logic behind linking TL and EPE through the mediating role of OC. The next section offers an overview of the methodological choices that were adopted to collect and analyse the research data, followed with a discussion of the findings and conclusions.

3. Methodology

3.1. Construct operationalisation

A 5-point Likert-scale was utilised to collect the primary data due to its common use and wide acceptance in the literature, where (1) indicates “strongly disagree” and (5) indicates “strongly agree”. In that, each of the components of EPE (i.e. meaning self-determination) was measured using four items developed based on Spreitzer’s (1995) Psychological Empowerment Questionnaire (PEQ). TL was measured using 16 items; four items for each component (i.e. II, IM, IS, IC) as explained by Bass et al. (2003). OC in turn was measured as a comprehensive construct using five items developed based on the OCTAPACE scale; a scale designed by Pareek (2002) to test the full profile of organisations such as openness, collaboration, confrontation, authenticity, trust and security.

3.2. Research instruments

This research uses a quantitative method that relies on a simple random sampling technique, which involves selecting a random subset of target respondents, with each member of the subset is having an equal chance of being chosen. Respondents were rank-and-file employees from different departments in 30 Jordanian five-star hotels. Rank-and-file employees are in a lower level than supervisors and have no managerial tasks, but are responsible for directly preparing and delivering products and services to customers. Those employees were surveyed to evaluate the support of their leaders and report on the empowerment degree they received within the cultural nature of their hotels (Maqableh et al., 2022). Selecting a different background sample helped avoiding bias and ensured the accuracy and representativeness of results.

A questionnaire was developed online using Google Forms and was distributed to targeted employees through their department heads (e.g. HR, RD, F&B). The online questionnaire was sent via WhatsApp and email, and included items that are mandatory to answer. The process of data collection resulted in 201 fully answered questionnaires out of 600 returned. All valid responses were analysed using the Analysis of Moment Structures (AMOS) Software, which was selected due to its wide acceptance in social studies and its capability to investigate complex relationships.

3.3. Empirical framework

Structural Equation Modelling (SEM) with maximum likelihood estimation is used to conduct the Confirmatory Factor Analysis (CFA) and to test the research model (i.e. main hypotheses). The CFA, based on the SEM, used the measurement model between the observed values (items) and their factors for each construct (AlQudah et al., 2021; Moussa et al., 2020). The SEM is a robust technique that is considered more powerful than normal techniques such as ordinary regression. The SEM allows for correlations among variables, which suits the current empirical model and helps inferring the cause–effect relationships (Bagozzi & Yi, 2012). These relationships among the observed values (items) and factors (latent variables) should be significant with a loading factor (weight) of at least 0.2 loadings of variables (Holmes-Smith, 2001); with more than 0.5 is a high reliability, between 0.3 and 0.5 is a moderate reliability and less than 0.3 is a poor reliability.

4. Empirical analysis

4.1. Participant demographics

The research sample, which consists of 201 participants with their characteristics, is summarised in Table 1. The vast majority of participants (90%) are males, and nearly half of them are in the middle age group (30–50 years old). Regarding the education level, 35% of participants hold Bachelor and Master degrees, 20.8% hold a high diploma and only 7.5% hold a PhD.

Table 1. Participant characteristics

Variable	Category	N	%
Gender	Male	181	90.0
	Female	20	10.0
Age	Less than 30	35	19.0
	30–39 years	50	17.4
	40–49 years	51	24.9
	50–59	39	25.4
	60 or more	26	19.4
Education level	Bachelor	71	35.3
	Higher Diploma	41	20.4
	Master	74	36.8
	PhD	15	7.5
Position	Director	96	47.8
	Manager	105	31.0
Experience	10 or less	23	11.4
	11–15	28	13.9
	16–20	39	19.4
		38	18.9
	21 or more	73	36.3

4.2. Descriptive statistics and correlations

Table 2 reports the means, standard deviations and inter-correlations between the constructs and their factors (i.e. EPE, TL, OC). EPE overall average is 3.82 (Stdev = 0.96) with slightly higher average for Meaning (3.92) than Self—determination (3.72). TL overall average is 3.57 (Stdev = 0.98) with almost the same average for the four factors: II, IM, IS and IC. OC overall average is slightly higher than TL with an average of 3.64 compared to 3.57 for TL, and the highest average is 3.82 for EPE. All averages indicate that participants agree with the main constructs based on 5-points Likert-scale classification. Variations to the three factors among all participants are almost the same, meaning that the level of agreement among participants is close. EPE is positively and significantly correlated with TL and OC, with the same correlation coefficient (0.80). All factors of OC and TL are positively and significantly correlated with EPE.

Table 2. Descriptive Statistics and correlations

Variable	Mean	St. Dev	1	1.1	1.2	2	2.1	2.2	2.3	2.4
1. Employee psychological empowerment	3.82	0.96	1
1.1 Meaning	3.92	0.96	.961*	1
1.2 Self–determination	3.72	1.03	.966*	.855*	1
2. Transformational leadership	3.57	0.98	.799*	.763*	.776*	1
2.1 Idealised influences	3.59	1.05	.805*	.790*	.762*	.849*	1
2.2 Inspirational motivation	3.61	1.09	.763*	.737*	.732*	.944*	.828*	1
2.3 Intellectual stimulation	3.62	1.02	.791*	.760*	.764*	.966*	.805*	.895*	1
2.4 Individualized consideration	3.48	0.99	.703*	.655*	.697*	.915*	.764*	.762*	.832*	1
3. Organisational culture	3.64	0.98	.821*	.804*	.778*	.870*	.819*	.813*	.849*	.797*

N=201; *the correlation is significant at the 0.01 level (2-tailed), * the correlation is significant at the 0.05 level (2-tailed).

4.3. Measurement model estimation and fit

Before moving to the Confirmatory Factor Analysis (CFA), the Kaiser—Meyer–Olkin (KMO) test was conducted to check the sampling adequacy. Bartlett’s Test of Sphericity (Bartlett, 1954) was also conducted to investigate the factorability of the data. Table 3 shows the suitability of the data for CFA and SEM, and the KMO results of 0.961; above 0.6 according to Pallant (2013) and a significant statistic test of sphericity (p < 0.001).

Table 3. KMO and Bartlett’s test

Kaiser-Meyer-Olkin Measure of Sampling Adequacy.		.961
Bartlett’s Test of Sphericity	Approx. Chi-Square	5979.611
	Df	406
	Sig.	.000

The CFA was conducted based on the proposed model confirming the number of constructs and the measured item loadings. Using the CFA to fit the results of the constructs, a Principal Components Analysis (PCA) with a Varimax Rotation was carried out; the results are summarized in Table 4. The total variance explained for the model ranged from 66.1 to 76.2%. In general, factors with component values less than 0.4 were considered to have a weak correlation with the factor and were removed from the analysis. All factors came above 0.4 and therefore were included in the model. Cronbach’s Alpha values were above the recommended value of 0.7 (Moore & Benbasat, 1991), with a minimum of 0.85 and a maximum of zero. The overall estimate of internal consistency was also above 0.9 for the three constructs.

Table 4. Percent of variance, Cronbach's alpha and component loading range

Dimension	Number of Items	Number of Removed Items	Average Variance Extracted (AVE)	Cronbach’s Alpha	Component Loading Range
1. Employee psychological empowerment	8	0	73.01	0.94	0.83–0.90
1.1 Meaning	4	0	76.74	0.90	0.779–0.860
1.2 Self-determination	4	0	80.7	0.92	0.882–0.928
2. Transformational leadership	16	0	66.1	0.94	0.61–0.89
1.2 Idealised influence	4	0	77.4	0.90	0.85–0.902
1.3 Inspirational motivation	4	0	82.4	0.92	0.89–0.93
1.3 Intellectual stimulation	4	0	78.0	0.91	0.869–0.91
1.4 Individualized consideration	4	0	69.1	0.85	0.78–0.87
3. Organisational culture	5	0	76.2	0.92	0.86–0.89

The measurement model was extracted using the CFA on Analysis of a Moment Structures (AMOS) Software 25.0 version utilizing the maximum likelihood estimation method. This aimed to test if the items that belong to their corresponding constructs are consisted of their corresponding factors. Table 5 shows the results of the measurement model for both job stability and employee quality. Regarding Carbon strategy, it was found that all factors were highly significant at the alpha level of 0.01, except the first statement in job retention “my skills are highly sought after at the labour market”, which was the only statement (item) removed from the analysis due to its insignificance. This is the same result obtained earlier using the validity and reliability analysis in Table 4. The goodness of fit for both constructs, as can also be seen in Table 5, suggests that the hypothesised measurement model is in a good fit with the data as all factors fall within the desirable standard range. The overall results of the measurement model supported the convergent and discriminant validity and reliability of the measures used in the hypothetical research model.

Table 5. Statistics of measurement analysis

Constructs	Factor	Items	Standardised weights	Goodness of fit indicators		Acceptable standard fit
Employee psychological empowerment	Meaning		1.00**	GFI	0.973	>0.90
		Mean1	0.76**	AGFI	0.940	>0.90
		Mean2	0.78**	CFI	0.994	>0.90
		Mean3	0.82**	NFI	0.983	>0.90
		Mean4	0.82**	RMSEA	0.049	<0.07
	Self-determination		1.00**
		SD1	0.84**
		SD2	0.85**
		SD3	0.91**
		SD4	0.83**
Transformational leadership	Idealised influences		1.00**	GFI	0.997	>0.90
		II1	0.72**	AGFI	0.990	>0.90
		II2	0.77**	CFI	0.989	>0.90
		II3	0.80**	NFI	0.982	>0.90
		II4	0.82**	RMSEA	0.026	<0.07
	Inspirational motivation		1.00**
		IM1	0.88**
		IM2	0.86**
		IM3	0.89**
		IM4	0.83**
	Intellectual stimulation		1.00
		IS1	0.84**
		IS2	0.84**
		IS3	0.83**
		IS4	0.82**
	Individualized consideration	IC1	0.76**
		IC2	0.83**
		IC3	0.56**
		IC4	0.71**
Organisational culture		OC1	0.82**	GFI	0.989	>0.90
		OC2	0.90**	AGFI	0.958	>0.90
		OC3	0.81**	CFI	0.998	>0.90
		OC4	0.85**	NFI	0.992	>0.90
		OC5	0.84**	RMSEA	0.045	<0.07

Notes: ** significant at 0.1% level.

- Goodness-of-Fit Index (GFI); Adjusted Goodness of Fit Index (AGFI); Comparative Fit Index (CFI); Normed Fit Index (NFI); Root Mean Square Residual (RMSEA)

The results of the structural model related to the research hypotheses are shown in Table 6. The goodness of fit indicators, as can be seen in Table 5, are above the recommended values, suggesting that the model is in good fit with the data (Bagozzi & Yi, 2012). With the use of Baron and Kenny’s (1986) technique in testing for mediation, the relationships between the three variables were tested to satisfy the four following conditions: (1) TL significantly affects the EPE; (2) TL significantly affects OC; (3) OC significantly affects EPE; and (4) the impact of TL on EPE is reduced after controlling for the effect of OC.

Table 6. Results of structural equation models

Path		Regression Weights	Standardized Weights	goodness of Fit Factors
Basic Model				GFI	0.994	>0.9
	TL → EPE	0.95	0.854**	AGFI	0.968	>0.9
				CFI	0.997	>0.9
				NFI	0.996	>0.9
				RMSEA	0.009	<0.07
				${\mathrm{R}}^2$	0.729
Mediation Model
	TL → EPE	0.141	0.13 (NS)	GFI	0.969	>0.9
	TL → OC	0.982	0.934**	AGFI	0.930	>0.9
	OC → EPE	0.803	0.777**	CFI	0.996	>0.9
				NFI	0.984	>0.9
				RMSEA	0.041	<0.07
				${\mathrm{R}}^2$	0.808

Notes: ** significant at 0.1% level, and (NS) is not significant.

Goodness-of-Fit Index (GFI); Adjusted Goodness of Fit Index (AGFI); Comparative Fit Index (CFI); Normed Fit Index (NFI); Root Mean Square Residual (RMSEA).

The results of the structural (basic) model indicate that TL is positively and directly related to EPE with β = .95 and a p-value <.01, suggesting that a greater TL has a greater influence on EPE, thus supports H1. The results of the mediation model indicate that only the indirect relationship via OC as a mediator between TL and EPE is significant, thus H3 is supported. In that, the relationship between TL and OC, and between OC and EPE, are both positive and significant with β = 0.982and 0.803 and a p-value <.01 for both, which implies that H2 is empirically supported. This result, along with the fact that the direct effect between TL and EPE, is no longer significant, as in the basic model, suggests that TL indirectly affects EPE via OC. The mediation model also explains more variation in EPE than the basic model, namely 72.9% versus 80.8%, respectively. These results offer empirical support for H4, suggesting that the relationship between TL and EPE is fully mediated by OC, and that EPE is largely enhanced by the implementation of TL via OC.

5. Discussion

The efficiency of TLs manifests in their ability to setting a good example to inspire employees coping with any pressures associated with novel work ideas and technologies (Anggiani, 2020). This can be achieved through adopting high ethical standards such as rightness, long-sightedness and sacrifice (Helalat et al., 2019; Pradhan et al., 2017). Whereas it is known that TL helps employees deliver task goals, solve work issues and thoughtfully serve their organisations, it is critical to explore its role in securing a suitable culture to psychologically empower employees and enrich their personal and professional careers (Haryanto et al., 2022).

The results of this research show the significant impact of TL (i.e. II, IC, IS, IM) on both components of EPE (i.e. meaning, self-determination). This aligns with prior research findings indicating the need to focus on the personal and behavioural traits of the leader to empower employees and enhance their performance (Chen & Wu, 2020; Dinibutun, 2020). When leaders understand and inspire employees, they are likely to be engaged, which optimises their psychological stance towards the work (Arefin et al., 2019). Such positive environment allows practicing clearer communication to spark harmony and alignment among leaders and employees (Kang et al., 2020). As a result, employees cooperate and creatively pursue novel duties supported by the existence of TLs who believe in the personalised consideration of their personal and work circumstances.

Results also explained the significant mediating role that OC plays in the relationship between TL practices and the level of EPE. The research found that organizations with a supportive OC provide a suitable environment for TLs to empower employees to confidently presenting their achievements. Although these results are aligned with Afsar et al. (2019); Magasi (2021) and Schermuly and Meyer (2020), they fully contradict with the results of Waris et al. (2018) that argued no significant impact of II, IC, IS and IM on employee performance and commitment. This explains the role of culture in the ability of TL behaviour and practices to stimulate employee psychological state, which presents an original insight. In that, creating an environment that focuses on the learning and development of employees and that encourages job stability can improve their perception of work value and quality, especially in Jordan where salary scales are seen to be greatly underestimated.

Most importantly, the results of this research have further explained the way in which TL can create proper OC, which was lacked in the literature (Cho et al., 2019; Srimulyani & Hermanto, 2022; Waruwu et al., 2020). This provides a good steppingstone to understand how transformational leaders affect the characteristics of workplace environment and culture, including employee engagement, commitment, creativity and sustainability. It also extends the common view of TL as a supportive or moderating variable for the relationship between OC and employee behaviours (Rahmatullah et al., 2022; Senbeto et al., 2022).

6. Conclusions and implications

6.1. Conclusions

This research revisited the relationship between TL behaviours and practices and the nature of EPE through emphasising the mediating role of OC. Psychologically empowering employees is an essential leadership practice and outcome, especially in hospitality organisations. This importance comes from the fact that, in such organisations, both leaders and employees should perform sensitive responsibilities to serve customers in a way that drive their satisfaction. Leaders play a significant role in employee empowerment through directly or indirectly modifying organisational environment and operations. Leaders can also secure suitable work conditions to empower their employees through providing training, delegating power, promoting collaboration, appreciating their effort and engaging them in decision-making.

The research presented a clear standpoint about the importance of the way in which transformational behaviours and practices of leaders can lead to creating more psychologically empowered employees, and how having the right culture within an organisation can support the outcomes of this relationship. In that, the research explained how organisations with fair standards, ethics, values, beliefs, attitudes and norms are considered as a natural supportive environment for leaders to transform and empower employees, allowing them to perform their job duties with a sense of commitment, responsibility, autonomy, trust and confidence. Understanding this relationship is essential to foster a well engaged, inspired, creative, motivated, and productive employee. Organisations should thus strive to cultivate and spread a positive culture that sustains transformational leadership behaviours and practices, maximizing employee empowerment and growth. This, eventually, helps achieving both employee and organizational objective, leading to more sustainable business growth.

6.2. Theoretical implications

This research contributes to a better understanding of the relationship between TL, OC and EPE in the Jordanian hospitality industry. Considering the mediating role of OC, the research provides contextual customisation of the impact of the various TL practices on the psychological performance outcomes of employees. TL is not merely impacting employee behaviours through the direct leader–employee interaction, but also through creating suitable cultures within organisations for employees to achieve higher deliveries and feel the value of their participation. In so doing, the research revisited the interplay between TL, OC and EPE to provide a holistic view of these variables as critical determinants of organisational performance.

6.3. Practical implications

This research provides valuable insights into the hospitality organisations in which less attention is given to the value of TL. Hospitality organisations should adopt TL practices to develop the skills needed by employees to cope with changing nature of services and the emerging customer needs and requirements. Managers in these organisations are required to adopt leadership approaches and secure inclusive and dynamic cultures necessary to empower employees to handle pressures caused by these developments. With this awareness in practice, hospitality managers can not only have greater pool of loyal and competent employees to progress and compete (which was evidenced in this research when psychologically empowered employees were reported as a leading asset) but also to guarantee the business continuity and reputational consistency of their organisations.

6.4. Limitations and future research

There are several limitations that may affect this research. Using self-report measures to assess OC and EPE introduces social desirability bias; employees might respond in a way that is believed to be socially desirable rather than reflecting on their true experiences. Exploring cultural constructs within organisations is context-sensitive, which restricts the generalisability of results across cultures; for example, different cultures can have unique perceptions of what is an empowered employee. Other limitations include the existence of unmeasured confounding variables that may be impactful to the interplay between TL, OC and EPE, such as employee backgrounds and/or external pressures.

The above limitations identify several future research avenues. These avenues include investigating potential moderating factors that can affect the choice of leadership style and employee behaviours such as age, gender and job tenure. Research designs that rely on observations as a supportive data collection method may also be of interest to provide deeper understanding and higher accuracy of results. Comparative research that looks at how TL affects employee performance across different cultures would further identify potential contextual variations and their implications on organisations. Other research avenues may include exploring how prominent leadership styles, such as transactional, authoritative and participative styles, can determine the nature of OC and its effect on EPE, or maybe replicating this research to find out how TL, OC and EPE interact in virtual team environments.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Abdullah Helalat

Abdullah Helalat We are a group of researchers mainly interested in topics related to business and management and applied statistics. The range of our research interests includes human resource management, leadership, organizational culture, innovation, international business, public relations, quality management, operations management, project management, supply chain management, and other related fields of applied statistics such as modeling checking and recursive estimation and residuals. This collaboration aimed at using a broad managerial view to help organizations better steer leader–employee interactions to enhance their potential performance outcomes. The paper presents a steppingstone in offering a comprehensive insight into the interplay of transformational leadership with employee empowerment and performance within the contextual specificities of organizational culture.