THE RELATIONSHIP OF LEADER EMOTIONAL INTELLIGENCE AND
ORGANISATIONAL CLIMATE IN COMPANY X
A thesis
Presented to the Faculty
Of International Business and Communication programme at ISM University of Management
and Economics
in Partial Fulfilment of the Requirements for the Degree of
Bachelor of International Business
by Sigita Andriukevičiūtė
Advised by
Doc. dr. Raimonda Alonderienė
January 2016
Vilnius LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 2
Abstract
[Andriukevičiūtė, S.], The Relationship of Leader Emotional Intelligence and
Organizational Climate in Company X [manuscript]: Final Bachelor Thesis. International
Business and Communication. Vilnius, ISM University of Management and Economics, 2016.
This thesis focuses on organisational climate among 12 teams in Company X, as well as emotional intelligence of the teams’ leaders. The aim of this thesis is to analyse the relationship between emotional intelligence of a leader and organisational climate of his team.
Objectives of the thesis
1. To conduct a situation analysis in Company X from the HR perspective.
2. To execute an empirical research in Company X, in order to measure emotional
intelligence of the team’s leaders and organisational climate of the teams.
3. To provide managerial solutions, how to improve organisational climate in the teams
through emotional intelligence of the team leaders.
Research methods. Quantitative empirical research was used to reach the objectives. The data analysis methods include descriptive statistics, reliability and correlation analysis.
Research results. There is no relationship between emotional intelligence of the leaders and organisational climate in the teams. Company X should focus on development of organisational climate by implementing specific practices into HR management.
Keywords: emotional intelligence, organisational climate, human resource management.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 3
Table of Contents
Introduction ...... 7 Relevance of the topic ...... 7
Research problem...... 8
Aim of the thesis ...... 8
Objectives of the thesis ...... 8
Research methods ...... 8
Practical value of the thesis...... 9
Logical sequence of the thesis ...... 9
Situation Analysis ...... 10 External Analysis ...... 11
Internal Analysis ...... 15
SWOT analysis and problem identification ...... 18
Theoretical aspects of the problem ...... 20
Empirical research ...... 26 Research aim ...... 26
Research objectives ...... 26
Theoretical foundations of the research ...... 27
Theoretical framework ...... 31
Research method and data collection method ...... 33
Research samples and sampling procedure ...... 34 LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 4
Research instruments ...... 36
Data analysis methods...... 37
Data analysis results ...... 39
Managerial solutions ...... 58 Improvement the level of EI for team leaders ...... 58
Improvement of organisational climate of teams...... 60
Limitations ...... 69 Conclusions ...... 70 References ...... 72 Appendices ...... 79
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 5
List of Tables
Table 1 PESTEL analysis ...... 12
Table 2 SWOT analysis for Company X ...... 19
Table 3 EI Competencies Model...... 20
Table 4 Conceptual differences between organisational climate and culture ...... 22
Table 5 Summary and Comparison of Emotional Intelligence Measure Characteristics ...... 28
Table 6 The meanings of Cronbach’s alpha values ...... 38
Table 7 Demographic characteristics ...... 40
Table 8 Reliability statistics for EI ...... 41
Table 9 One-sample T-test for EI of leaders ...... 41
Table 10 Reliability statistics for Organisational Climate ...... 41
Table 11 One-way ANOVA test: Organisational Climate ...... 42
Table 12 The level of EI and EI dimensions of team leaders ...... 43
Table 13 Means of every OCQ item for the teams in Company X...... 46
Table 14 Highest evaluated items of OC in Company X ...... 46
Table 15 Least evaluated items of Responsibility and Teamwork dimensions of OC ...... 47
Table 16 Other least evaluated items of OC in Company X ...... 48
Table 17 Theoretical model of Organisational Climate ...... 49
Table 18 Practical adaptation of the matrix to the Company X’s research ...... 53
Table 19 Pearson correlations between EI and OC and their dimensions ...... 55
Table 20 Comparison coordination of work to specific dimension of EI ...... 55
Table 21 Analysis of Team 12, considering EI and OC ...... 56
Table 22 Course of actions for teams’ leaders ...... 59 LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 6
Table 23 Possible practical solutions for improving parts of OC in Company X ...... 64
Table 24 Course of organisational climate improvement actions for teams’ members ...... 67
List of Figures
Figure 1. Theoretical framework ...... 32
Figure 2. Matrix of Organisational Climate in Company X ...... 51
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 7
Introduction
Relevance of the topic
The growing companies and corporations face many problems by managing human resources. Assessing the effectiveness of employees and creating a positive organisational climate is resulting difficult due to constantly increasing numbers and high turnover of employees. De Vries (2001) found out that organisational climate is one of the criteria, which has an impact on the success of the organisation. Successful organisations can be distinguished by organisational climate, which supports and fosters the motivation and well-being of the employees.
Company X is an international corporation, which steadily grows and experiences the problems mentioned before, including high employees’ fluctuation and low retention rate. The average stay of an employee in Company X Lithuania is only 6 months. The fast growth makes it difficult for Human Resource (HR) managers to understand the reasons and important factors stimulating the turnover as well as finding possible opportunities for the improvement. Goleman
(2000) concluded that the leaders and their emotional competencies have a significant impact on organisational climate. Researchers suggest that leader is an important indicator in evaluating employees’ satisfaction at work and retention (Voon & Lo, 2011; Taylor & Francis, 2004)
The organisational structure of Company X is based on working in small teams of 10-20 people, where every team has its leader. The leader is directly influencing the organisational climate of the team, which has a direct impact on the retention of employees (Brown et al.,
2002). Due to this empirically based conclusion, the potential area of research in Company X could be defined. The measurement of leaders’ emotional intelligence (EI) and organisational LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 8 climate (OC) in their teams could provide valuable conclusions on possible improvement of HR management, also increasing the overall effectiveness of the company.
Research problem The research problem of the thesis is how to improve organisational climate of the team through emotional intelligence of the team leaders?
Aim of the thesis The aim of this thesis is to analyse the relationship between leaders’ emotional intelligence and organisational climate of the teams in Company X and determine practical implementations for the improvement of organisational climate.
Objectives of the thesis 1. To conduct Company’s X internal and external environment analysis from the HR
perspective.
2. To execute a quantitative empirical research in Company X, in order to measure
emotional intelligence of the team leaders, organisational climate of the teams and
possible interrelationship between these two measures.
3. To provide managerial solutions, how to improve organisational climate in the teams
through emotional intelligence of the team leaders.
Research methods
The thesis includes various research methods, which consist of the situational analysis, using primary and secondary sources, analysis of academic literature, quantitative empirical research, based on 12 team leaders and 145 team members of Company X in the U.S. and
Lithuania, by employing descriptive statistics and correlation analysis. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 9
Practical value of the thesis
The results of the empirical research show how the employees feel within their teams, evaluating organisational climate in the team, and the level of emotional intelligence among the team leaders in Company X. These results help to assess the overall organisational climate of the company, as well as to compare the situation among the teams. The empirical research also concludes, if there is any relationship between leaders’ emotional intelligence and organisational climate in their teams. The results help to provide managerial solutions for Company X, by explaining which criteria have strong influence on organisational climate of the company. They also suggest ways to increase the satisfaction of employees by improving organisational climate, considering every dimension separately and providing strategic planning, together with practical solutions, for Human Resource Management of Company X.
Logical sequence of the thesis
The thesis is structured in the following way:
1. Situation analysis part, which includes internal and external environment analysis of
Company X and the identification of the research problem, based on theoretical background.
2. Empirical research part, which includes analysis of academic literature, description of research methods and process, data analysis and conclusions.
3. Managerial solutions part, which includes recommendations on improving emotional intelligences of the leaders’ and organisational climate of the teams in Company X. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 10
Situation Analysis
The first part of the thesis is aimed at conducting situation analysis of Company X, concentrating on the main office in the U.S. and its international service centre in Lithuania. The analysis includes both, internal and external factors, which have an impact on the company, highlighting the influence on the Human Resource department of Company X. The situation analysis is concluded with problem identification and its practical importance to the company, as well as theoretical background of the problem.
General information about the company
Company X provides mainly technological solutions and database services for health care institutions around the world. The company dates back to 1978 in Florida, the U.S. In 1981 the company has changed its focus from billing traffic tickets for Emergency Medical Services
(EMS), which was a relatively new industry. The products of the company provide technology solutions for federal, state, and local government agencies, healthcare providers, and corporations. Company X has been a leader in health care business services for more than 30 years. Today, with more than 2500 employees around the globe, Company X processes more than 15 million patient encounters, collects more than $3 billion in revenues and connects more than 95% of the United States population through its emergency preparedness and response technologies. From the year 2002 Company X has been constantly growing by acquiring many different companies in various countries and broadening the spectrum of services provided
(Company’s X Annual Report, 2014). At this moment Company X has 29 offices in the U.S., the
United Kingdom and New Zealand and has clients in 25 countries. Company X has an international service centre based in Lithuania, which opened in 2014 as a subsidiary company. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 11
It is is a part of Company X and supports the parent company with its qualified workforce, technological knowledge, mostly providing technology and analytical services for Company X
Organisational structure. Company X has more than 2500 employees, spread in 4 countries – the United States of America, New Zealand, the United Kingdom and Lithuania.
Despite the fact that the main offices are in the U.S. (26 offices), while other countries have just one office each, Lithuanian Corporate Headquarter forms a big part of the whole Company’s X community. At the moment, Company X in Lithuania has 584 employees and there are constantly some positions vacant. This international service centre is rapidly growing; it has doubled the amount of employees during a year. The strategy of the company will predict even faster and bigger increase in employees and capacity within the next year. Company X in
Lithuania has a complex, tall organisational structure (see Appendix 1), having many levels of hierarchy. All employees of the company are divided into 8 divisions. Divisions with more employees are divided into the teams, based on the positions. At the moment there are 30 teams.
Every team consists of about 10-30 people and has a team leader.
External Analysis
The better understanding of the environment, in which company is operating, and its influence, requires external analysis of both, Lithuanian and American market. PESTEL analysis tool will be used (see Table 1 below), in order to disclose the most important factors, which have an impact on Company X, especially on its Human Resource Management.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 12
Table 1 PESTEL analysis PESTEL FACTOR EFFECTS ON COMPANY X Political: Lithuania: -Eurozone crisis and conflicts in the -This is in favour for Company X, because Lithuanians trust European Union (EU) and are willing to work in a foreign-capital company. -The political strategy to encourage - The financial support of the Lithuanian government let Foreign Direct Investment in Lithuania open Company X in Lithuania. The U.S.: -Government grants for the expansion -The Company X is quite dependent on the U.S. government, of Company X when creating new technological solutions. Both: -Increasing political stability -Encourages the expansion of Company X, followed by higher demand of new employees. Economic: Lithuania: -Increasing minimal wage in Lithuania - In 2015 the minimal wage in Lithuania has increased. It diminishes the competitive advantage of Company X, which was able to propose a little higher wage than minimal. Both countries: -Due to better economic conditions, competition with other - Increasing economic stability companies to get best employees had increased. Socio-cultural: Lithuania: - Changes in generation - Y generation: - Company X experiences high employee turnover and has flexible attitude, less work to increase the retention rate. engagement. The U.S.: -Decreasing labour force participation rate increases the need -Shrinking workforce of the foreign workforce. Both: -Changing employee motivation factor -Company X has to adapt to motivation trends. Technological: Both countries: -Technological changes, e.g. The -Company X had to adapt to technology changes and has foundation of Oracle Cloud technology experienced the need of qualified employees in a very (2012). specific sphere. It aggravated the recruitment process. Environmental: The U.S.: - A growing preference for - Company X has introduced employee-driven program environmentally-friendly companies. “Choose to be green”. Legal: Lithuania: - Labour laws, restrictions on - Lithuanian law regulates the termination of the employment employment contracts contract very strictly, creating legal difficulties. -Introduction of new labour code -More liberal approach should be helpful for recruitment. The U.S.: - More liberal labour law -The U.S. law requires neither complicated termination process, nor notification before the termination. Source: Compiled by the author LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 13
All the macro-environmental factors have an impact on Company X. In general,
Company X experiences the major influence of technology and legal trends, whereas the most important factors for the Human Resource Management (HRM) department are different. A significant impact to HRM has political, economic and socio-cultural trends. The political situation is now in favour of Company X. The American government is willing to invest in new health care technologies, especially for crisis management and emergency medical services
(Mutter & Clancy, 2014). These political concerns are growing since the terrorist attack on
September 11, 2001. Due to the subsidies of the U.S. government Company X had created
Inventory Management software and other tracking and data analysis systems (Company X
Annual Report, 2012). Governmental grants let Company X not just expand the services, but also the capacity, increasing the number of employees and offices. Company X’s International
Service Centre in Lithuania was also opened using the government subsidies. Based on the project “Invest LT+”, the establishment of Company X in Lithuania was granted 1 million Euros
(BNS, 2013). These governmental grants help to increase the capacity and expansion of the company, therefore the number of employees is increasing, intensifying the recruitment processes. The political instability in Lithuania, as well as in the European Union, stimulates higher employees’ demand on foreign-capital companies, especially American (cvmarket.lt,
2015). People tend to believe that foreign-capital companies will provide not just higher salary, social guarantees, but also better career opportunities. All these political factors mentioned before boost the growth of Company X’s workforce, therefore increasing load to the Human
Resource Department.
The changing economic environment has challenged the HR Management of Company X in Lithuania and the U.S. as well. Increasing economic stability and minimal wages have LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 14 improved the situation for the workforce, creating more competitive environment between the employers. Company X in Lithuania is losing its competitive advantage to pay a little bit more than minimal, because the minimal salary in Lithuania has been raised in 2015 and will be increased in 2016 as well. In Lithuania there are some more big international service centres, demanding same qualified employees. The main competitors of Company X in Lithuania, from the HR perspective, are CallCredit Operations, CSC Corporation, Barclays and Atea Group.
Some legal factors also should be mentioned, because they are creating the major difference between the U.S. and Lithuania. In the U.S. there is much more liberal labour code, which do not burden HR management in the recruitment process. In Lithuania, quite controversially, there are many restrictions, when hiring or firing employees. However,
Lithuania recently updated its labour law, which should be in favour for employers as well, because it includes some more liberal changes, e.g. a decrease of severance pays, shortened duration of notice before dismissal, shortened period of vacations, more flexible work hours.
Most important socio-cultural factors are changes in generations, followed by different employees’ motivators than some decades ago. Most employees of Company X in Lithuania are from generation Y, which values flexible work hours, less commitment to work, many work place changes (Zemke et al., 2000). This creates a challenge for the company to attract young people for longer periods of time to work in the company and become engaged to it. Also in both societies, American and Lithuanian, the motivators for employees are changing (Stajkovic &
Luthans, 2001). Motivation for money is decreasing; the most important for the U.S. employees are career opportunities, development and training (Gallup, 2013). Lithuanians prefer encouraging work environment with opportunities to realize their own ideas (Kriaučiūnienė,
2012). HR managers are responsible for the creation of the conditions, which would motivate the LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 15 employees. The HR management in the U.S. faces even more difficulties, due to shrinking size of the workforce in general. From the year 2000, the labour participation rate of the Americans is dropping down, whereas other stable and increasing economies are experiencing growth (OECD,
2015). This trend creates the difficulties for Company X in the U.S. to attract employees, therefore the company is encouraged to expand to other countries as well.
Internal Analysis
This part will include the analysis of Human Resource Department of Company X, describing the structure and main functions, specific processes, however, mainly concentrating on the situation in Company X in Lithuania, because the company is seeking most analysis of this business unit, due to its short period of existence and lack of data from the HR management.
This information will provide some knowledge about the HRM strategy and will help to make logical assumptions for further research and its analysis.
Human Resource Department structure and functions. The Human Resource department is a part of the General Office and is made of six employees – the Director of the
Department, Recruiter, HR Administrator, Junior HR Administrator, HR Specialist and HR
Junior Business Analyst. Currently the department makes all the HR functions by itself – from the search of potential employees to the employment contract signing, placement of the employee and orientation process. There is no comprehensive on-boarding program yet, just a couple of first days are appointed to the presentation of general information of the company. The department also makes the screening process itself. This was previously done by an external company. Company X in Lithuania terminated the collaboration with external recruitment agency due to several reasons. First of all, HR department gained the knowledge, how all recruitment process is made. At the very beginning it was not enough qualified human capital to LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 16 manage a big amount of new employees’ screening process, in order to do it internally.
Secondly, costs of external recruitment are higher than internal selections. Despite the fact that the company is still growing, the need of new employees is predictable and the HR department is able to conduct the selection process by itself.
Employee recruitment and selection. The fast growth of the company and constant need for new employees forces the HR department to use different recruitment strategies and tools, in order to be able to attract the necessary number of candidates for every vacant position. For external recruitment Company X use two main tools: public announcements in job search platforms on the internet and candidates, recommended by current employees. In order to encourage the employees to be active in new employees’ search, the company has a Referral
Policy. This policy defines that if the recommended candidate gets the position at the company and works at least 90 days, a financial premium is appointed to the employee, who had sent the referral. The amount of the premium is dependent on the position, for which the candidate is suggested. Successful referrals for those positions, which require specific competencies and rare qualification, are compensated the most. This tool is beneficial, because the candidates already have some knowledge of how the company is working, how the positions look like and what skills are needed. The job proposal from current employees directly encourage the potential candidate to consider the possibility, ask for further information and apply, if the offer is suitable. About one third of new employees is recruited using this policy.
The selection process consists of three main stages, which are applicable for all the candidates, whether the application is from internal or external sources. The first stage is the review of the CVs’ (Curriculum Vitae). The candidates are sorted by the required qualifications, experience and skills. The second step for selected candidates is interviews by phone, during LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 17 which the expectations about the position and the salary, work conditions are clarified, the
English communication skills are checked. The last part of the selection process is an interview in the company with the team leader, depending on the team, in which vacant position is presented. Interviews for higher-level positions also include some simulation tasks.
Employee motivation and compensation strategy. Company X in Lithuania seeks to create a pleasant environment for every employee, therefore they are working in small, closely related teams. Many different benefits are provided - from small gifts every Friday to the huge festivals before the Christmas or during the summer. Different events are being organised every week, trying to meet the needs of every employee. They are invited to play poker, volleyball, basketball, participate in car racing, brain quizzes, etc. However, despite of the very wide spectrum of suggested activities, the participation rate is quite low. The teams are not encouraged by their team leaders to participate and do not see an example, because the leaders themselves are not involved in after-work activities (Company X in Lithuania, 2015). Company X in
Lithuania tries to help every employee to develop outside the company, as well as in the work environment. Employees are supported financially, if they want to develop their competencies, have work-related trainings and refresher courses, in order to stay as productive as possible, develop certain competencies and skills. The goal of Company X is to create a pleasant and encouraging environment for their employees, provide opportunities to develop their careers within the company. A major part of managers have started to work at the company at the lowest position and created their path of career (Company’s X Annual Report, 2014). Company X in
Lithuania has been ranked as the most attractive employer of 2015 (Verslo Žinios, 2015). The company has won against other international giant „Barclays “. This award proves that the LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 18 strategy of Company X in Lithuania towards employees and public image is operating very well and effectively.
Company X has defined very clear and structured compensation process for every position.
The salary for the first three months is the same for every employee in the same position. After that period, there is an opportunity to have an increase in the wage, based on the performance.
For this purpose, Company X has developed Performance Based Compensation Program Policy.
Although the company is well ranked and internal strategies and policies seem to work fine, the turnover of employees is growing. This tendency is quite predictable, because the number of employees in general is growing as well. The low retention rate is still a problem of the company. The inner environment in the work team together with the corporate strategy and the company policies have a strong impact on the job satisfaction of the employees.
Communication effectiveness within the team and the performance of the team leader has a significant impact on the satisfaction of the team members (Miles & Mangold, 2002). Company
X has no clear measurement of the performance of the team leaders, therefore there is no reasoning, which would justify the high turnover of the employees and which impact do the leaders have on this, if they do.
SWOT analysis and problem identification
The external and internal analysis identified main factors, influencing Company X and its
HR management, as well as provided the factual information, how the company is structured and organised. In this part the whole situational analysis, considering internal Company X’s situation and external factors, will be systemised by employing a SWOT analysis tool (see Table 2). The analysis will be mainly concentrated on the situation of Lithuania, because the data and LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 19 information for the Lithuanian office is wider and more available, also it is more relevant for the company.
Table 2 SWOT analysis for Company X Strengths Weaknesses Qualified HR management Low employees’ retention Positive image as employer High fluctuation Effective recruitment strategy Low engagement of team leaders No assessment tool of leadership Opportunities Threats More effective recruitment due to Intense competition for qualified changes in labour law employees Collaboration with universities and Decreasing competitive advantage other youth organisations, in order to against other companies due to attract motivated employees increase of minimal wage
Source: Compiled by the author
The analysis concludes that the main problem for the HR department is high turnover of employees’ followed by low retention, which is threatened even more by intensive competition amongst other service centres or the companies, recruiting employees based on similar requirements. Companies’ specific organisational structure requires high leadership effectiveness and positive organisational climate within the team. High evaluation of organisational climate has a relationship with the performance of the supervisor (Brown & Leigh, 1995). Having no assessment tool for leaders’ effectiveness and no justified reasons of employees’ turnover, requires a thorough analysis, how the leaders could impact the well-being of employees, how it could be measured and justified. Company X in Lithuania has a goal to stay the best employee in
Lithuania and also become better valued in the U.S. Human Resource Department has a difficult challenge, because the image of the company includes not just public opinion, but also the feedback of the employees and their satisfaction. In order to find out, what could have impact on LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 20 the performance of the leaders and how the well-being of the employees could be measured, the next part of the thesis will analyse academic literature and theoretical background of this topic.
Theoretical aspects of the problem
This part concentrates on secondary sources about the mentioned problem before. Two main terms – emotional intelligence and organisational climate - are discussed, as the means of leadership effectiveness and employee well-being measurement. The literature review is provided, by systemising past researches, empirical proofs and possible directions for further research. The analysis also includes possible relationship and correlation between emotional intelligence and organisational climate, providing suggestions for the research in Company X, addressing the problem.
Emotional Intelligence. Emotional Intelligence was firstly defined by Salovey and
Mayer (1990) as a form of social intelligence, which consists of the perception, controlling own emotions and feelings, as well as understanding the others’, being able to use this information in social interactions. The definition was broadened and presented to the general public by D.
Goleman (1997). EI is a combination of different competencies, which are not innate and can be developed. D. Goleman defined competencies of EI, dividing them to the four main dimensions and 20 sub-competencies (See Table 3).
Table 3 EI Competencies Model Self-Awareness Social Awareness Emotional Self-Awareness Empathy Accurate Self-Assessment Organisational Awareness Self-Confidence Service Orientation Self-Management Relationship Management Self-Control Influence Trust Worthiness Leadership Conscientiousness Developing Others LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 21
Adaptability Communication Achievement Orientation Change Catalyst Initiative Conflict Management Building Bonds Team Work and Collaboration Source: Goleman (2002)
EI is a relatively young concept, but despite that, there are many researchers, who have analysed the importance of EI and its impact to different areas of life. Several dimensions of EI were proved to have significant impact on academic success. Already in pre-adolescence, emotional intelligence has an effect on academic achievements. The united team of Australia and the U.K. scientists has justified that analysing and understanding the emotions (one of the main part of EI) has a significant correlation with achievements at school in numeracy and literacy
(Billings et al., 2014). The analysis in higher education also proved the positive relationship between emotional intelligence and academic achievements. The research concluded that intrapersonal skills, adaptability and stress management are key factors, predicting GPA (Grade
Point Average) of the first year students (Parker et al., 2004).
Another broad area of the research is the relationship between emotional intelligence and work effectiveness. The study of Wong & Law (2002) concluded that the level of emotional intelligence has an impact on work productivity of both, the leaders and subordinates. Job performance was also proved as being strongly influenced by emotional intelligence, despite organisational, geographical and other demographic differences (O'Boyle et al., 2010). The importance of emotional intelligence in professional field was broadly analysed by D. Goleman
(1998). The research was done in 200 international companies and the results showed the correlation between high levels of EI and effective leadership. Managers, leaders and professionals in many other areas should develop EI competencies, in order to seek for higher career positions (Boyatzis, 2009). High EI is crucial for employees in international, global LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 22 environment, because it positively influences cross-cultural communication and perception (Fall et al., 2013). Cherniss (2003) names EI as the main success factor in major workplaces. It positively influences not just work results, but also stress-management and the ability not to burn-out while working with people (Oginska-Bulik, 2005). Lopes et al. (2006) proved that emotionally intelligent employees in financial sector get better evaluations of supervisors and associates, work more profitable, get promotions faster, despite the gender, age, education or other demographic factors.
Organisational climate. Organisational climate is a broad definition, which is often misinterpreted as organisational culture. West (1998) defined organisational climate as perceptions that members of the organisation share of the fundamental elements of their organisation. Sparrow and Guston (1996) defined the main categories, where the distinction between organisational climate and organisational culture is very clear (See Table 4).
Organisational culture is set of shared beliefs, norms, values, which influence employees’ behaviour, whereas organisational climate is the employees’ perception of the work environment, goals and other common factors.
Table 4 Conceptual differences between organisational climate and culture Conceptual Organisational climate Organisational culture differences 1. Frames of Psychological schema: Based on Group understanding: organisational hidden personal values that may be Ways of perceiving, thinking references aggregated across organisations. or feeling in relation to a group’s problems. 2. Unit of theory Individual and shared System-sanctioned psychological fields: Average of how behaviours: Norms, beliefs people perceive the way in which the and justifying ideologies environment is personally beneficial which are appropriate and or not. beneficial to all members of the system. 3. Unit of analysis Vary from individual to aggregate Always on collective groups, measures of consensus at work never the individual – deeper LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 23
group, division or organisation elements of analysis such as level – shared and learned shared meanings, perceptions resulting from policies, assumptions and values that practices and procedures. underline these organisational policies. 4. Implied level of Conscious subset of learned Subconscious, taken-for- consciousness responses and acquired meanings. granted learned responses. Source: Sparrow and Guston (1996)
The organisational climate definition is also often used as synonym for psychological climate, which is not exactly correct. These definitions have been already separated in 1974 by
James and Jones, explaining that psychological climate is an individual approach, referring to personal perceptions and feelings on organisational culture, when organisational climate is an organisational attribute. It is most often measured as an average perception of the employees, which are in the same environment and organisational culture.
Organisational climate is affected by many different organisational factors and at the same time has influence on organisational and psychological factors of the organisation (Isaksen et al., 2001). Firstly, organisational climate is influenced by the organisations establishment conditions (Michela & Burke, 2000). The beliefs of leaders and top managers, their interests, personalities and values are concerned as main influencing factors during the formation of organisational climate. Later on, organisational climate changes and settles based on group interactions. Hubbart & Watkin (2003) highlighted the results of longitudinal research, which linked organisational climate to performance. Organisations, which were characterized as high- performers, also could be distinguished by outstanding organisational climate indicators.
Organisational climate is also defined as a reason for service quality and service results (Glisson
& Hemmelgarn, 1998). This study also proved the effectiveness of the approach to improve organisational climate rather than services coordination with the organisation. The impact of organisational climate was investigated in various cultural and organisational settings. Research, LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 24 investigating 419 employees in China, confirmed that organisational climate positively correlates with other human resource management indicators, such as retention, job satisfaction, commitment, etc. (Zhang, 2010). Janjua (2014) examined the effects of organisational climate in
South Asia (Pakistan) and proved significant interrelationship between organisational climate and motivation, employee commitment.
Relationship between leader’s emotional intelligence and organisational climate. The benefits of high emotional intelligence and the importance of organisational climate were discussed above, raising the question, if these two factors are interrelated. Based on the traditional organisational climate model (Field & Abelson, 1982) influence of leadership is one of the main three factors, affecting organisational climate. Goleman (2001) linked EI of the leader and employees’ perceived emotional condition and motivation to perform better. The leader has also an impact on subordinates’ psychological wellbeing, organisational climate by his/her behaviour and leadership style (Klem & Schlechter, 2008). Leaders use their rational skills, as well as emotional competencies, in order to influence the performance of the employees, therefore the emotional ability of the leader has a direct impact on subordinates
(Hughes et al., 2002). Lewin (2007) found out that different emotional competencies of a leader create different team environments, which have an impact on employees’ satisfaction, work engagement and turnover.
Klem & Schlechter (2008) proved that there is a significant relationship between leader emotional intelligence and psychological climate, defining that the emotional skills of the leader reflect not just on general well-being of the team, but also on every individual perception.
However, the influence on organisational climate is more important, because, as described in the previous section, organisational climate directly affects job performance and other organisational LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 25 outcomes. The significant correlation between emotional intelligence of leaders and general organisational climate exists. Two specific EI dimensions, namely social awareness and self- awareness, have particularly strong influence (Momeni, 2009). The effect of the level of every competency of emotional intelligence to organisational climate was investigated as well, also providing significant interrelationships (Yoder, 2004). The researchers suggest that high emotionally intelligent leaders could be a crucial success factor for every company, having direct impact on productivity and performance.
The specific organisational structure of Company X and growing employee turnover makes a demand for thorough research, how employees feel in the company and what could have an impact on it. The expansion of the company and therefore the workforce also require specific measurement, how the top-level positions could be assessed. The external situational analysis, internal factors and theoretical aspects confirm the problem and need of the analysis, in which emotional intelligence of the team leaders, organisational climate within the team and the possible relationship between these two measurements will be assessed.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 26
Empirical research
This part of the thesis is aimed to describe the empirical research, which was made in order to analyse the problem mentioned before and provide the managerial solutions for the company, which will be discussed in the third part of the thesis. The research is concentrating on analysing emotional intelligence of the team leaders and organisational climate among the teams in Company
X. In this section the background, the sequence and the results of the research are explained, beginning with the aim and objectives of the research, providing the theoretical foundations and also reasoning the selected methods of the research, data collection, sampling procedures and research instruments. The last part of the section provides the data analysis, discussing the results of the research.
Research aim
The aim of this research is to determine the level of emotional intelligence of team leaders and the evaluation of organisational climate in the teams in Company X.
Research objectives
1. To conduct the analysis of theoretical approaches to emotional intelligence and organisational climate.
2. To measure the level of emotional intelligence of the team leaders in Company X.
3. To determine the level of organisational climate in the teams in Company X
4. To analyse the relationship between emotional intelligence of the team leaders’ and organisational climate of their teams LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 27
Theoretical foundations of the research
In order to construct a research instrument, which would be valid and suitable for the research, the thorough analysis of EI and OC concepts should be made. In this part different approaches and measurement tools of these two definitions are discussed.
Emotional Intelligence. When choosing the measurement of EI, the main problem is the lack of one united definition of this concept (Brackett & Mayer, 2003). During various studies, three main approaches to EI were formed, followed by developed models and measurement tools.
The further analysis discusses most scientific reasoned models and their measures.
Salovey and Mayer Ability model. The model perceives EI as a sum of different abilities, which could be divided into four branches: Emotional Perception, Emotional Integration,
Emotional Understanding and Emotional Management (Mayer and Salovey, 1997). The measurement tool based on this approach is the Mayer Salovey – Caruso Emotional Intelligence
Test (MSCEIT). This assessment tool involves different measures for each ability and measures maximum performance, meaning that questions, based on the abilities of the person, could be answered correctly or incorrectly.
Schutte traits-based model. It, conversely to the ability-based model, does not value the individual’s performance, but refers to self-perceptions of their emotional competencies. The
Schutte Self Report Emotional Intelligence Test (SSEIT) is a 33 item self-report measure, analysing four main competencies of EI (Schutte et al., 1998). The test concentrates on appraisal and expression, understanding, regulation and utilisation of emotions. This model is constructed directly based on Mayer & Salovey (1997) model, just developing the questionnaire, which relies on the self-perception rather than the solutions of different tasks. The tool was made, in order to create a theoretically based and empirically valid instrument, which would not require a lot time LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 28 of the respondent. This particular survey is often used in business and HRM research for primary determination of the level of the EI as a tool for the detection, if any improvements are needed.
Bar-On Mixed Model. The Bar-On model (1997) concentrates on the process rather than the outcomes of performance. The model focuses on the broad approach to emotional abilities, dividing them into 5 components. Based on this model a self-report measure – Bar-On Emotion
Quotient Inventory (EQ-i) is developed.
Goleman Mixed Model. Goleman model (1997) was started to develop based on Salovey and Caruso (1997) model, which was adapted and changed based on competencies approach.
The Goleman Competencies Model (2002) defines 4 competencies.
All four models and measurement tools are summarized in Table 5:
Table 5 Summary and Comparison of Emotional Intelligence Measure Characteristics EI Measure Approach Theoretical EI Dimensions Length on EI Model and Scales Mayer-Salovey- Ability- Mayer & Perception and expression of emotion 141 Caruso based Salovey Emotional facilitation of thinking items Emotional (1990, Understanding and analysing Intelligence Test 1997) emotional information (MSCEIT) Regulation and management of emotion Schutte Self Traits- Schutte at Appraisal and expression of emotions 33 Report EI Test based al. (1998) Understanding of emotions items (SSEIT) Regulation of emotions Utilisation of emotions Emotional Mixed Bar-On Intrapersonal 133 Quotient (1997) Interpersonal items Inventory(EQ-i) Adaptation Stress Management General Mood Emotional Mixed Goleman Self-awareness 72 Competence (1995,1998) Self-management items Inventor(ECI-2) Boyatzis, Social awareness Goleman & Social skills Rhee (1999) Source: Compiled by the author LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 29
Organisational climate. The definition of organisational climate is very old, backdating to 1939, firstly used by Lewin, Lippit and White. Organisational climate is a measure of how the employees feel within the company and how they value the quality of the internal environment
(Moxnes & Eilertsen, 1991). It is a complex concept, because it can differ within the organisation and it has various dimensions (Cohen, 1995). The long period of different research and broad approach to this topic influenced the evaluation and creation of many theoretical models, dividing organisational climate into different dimensions and developing measures of it.
However, there is no fully trustful approach (Guion, 1973). James and Jones (1974) were trying to eliminate the complexity of the concept, therefore their research has summarized all the research and theoretical foundations, by dividing organizational climate concept into three main approaches:
The multiple measurement-organisational attribute approach. This concept is based on
Gilmer & Von Haller (1964, p. 361) definition that organisational climate is “set of characteristics that describe an organisation”. Such a view does not consider the size, strategy of the organisation, leadership styles and organisational structure as variables, which can influence the organisational climate (James & Jones, 1974). Based on the opinion of the authors, this approach is too broad and generalized, involving too many variables without any cause-effect measurement.
The perceptual measurements-organisational attribute approach. This approach is more structured and concentrated on the individuals’ perception on the organisation. The main characterisation is how the organisation deals with every member and how their expectations are met, based on the opinions of individuals (Campbell, 1970). Even though it is based on individual perceptions, it is considering general situation of the organisation. However, further LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 30 research on this approach concluded that the measurement of it shows just perceived individual attitude towards the organisation, not exactly indicating the general climate (Nimmo, 1980).
The perceptual measurements-individual attribute approach. This approach is clearly individualised, considering how the individual feels and how the organisational climate has an impact on the person concretely. The main difference between perceptual individual and organisational approaches is that in the second approach measure the individuals approach toward an organisation, while the first – concrete and personal individual’s feeling and experience in an organisation (Farmer, 1996). This approach was later distinguished as more like psychological climate (James & Jones, 1974) and was eliminated from the theory of the organisational climate, which was a great step in building the concept of the organisational climate.
The main analysis of the organisational climate was made in 1970’s and did not change a lot during the years. The researchers have agreed on the approach that the main unit of analysis of organisational climate has to be the individual and his perception toward an organisation
(Joyce & Slocum, 1990). The various studies also developed different dimensions, which could be involved in the measurement of organisational climate. James & McIntyre (1996) found out four common dimensions, which they had identified researching in different settings of work environment: 1) role stress and lack of harmony; 2) job challenge and autonomy; 3) leadership facilitation and support; and 4) work group cooperation, friendliness, and warmth. The different studies have adopted the dimensions to their own purposes by including different factors as leader’s psychological distance, risk orientation, communication, service quality, etc. (Dawson et al., 2005). Most commonly used measure of the organisational climate is based on Stringer ‘s LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 31
(2002) six dimensions – a) organisational clarity; b) responsibility; c) reward; d) standards; 5) conformity and 6) team spirit (Subramanian & Shin, 2013).
The unique background of an organisation and different purpose of every research suggested that the dimensional frameworks could differ among the organisations (Schneider,
2000). The attitude on the adaptability of the dimensions and measures had divided the researchers into two main contrary sides (Patterson et al., 2005). The opposing part to Schneider claims that there is no need and purpose to adapt the measurement scales to every organisation and organisational climate has to be understood as a global approach, meaning that there is just one right framework of it (Glick 1985; Payne et al., 1992). Scheider (2000) suggests a domain specific approach, where every research instrument should be changed based on the purpose of an analysis. Patterson (2005) claims that both approaches have different benefits and both are valid. The use of one or another should depend on the purpose of the research and the objectives, which are seeking to be achieved during the research.
The analysis of the literature, describing both concepts of the research – emotional intelligence and organisational climate – was a very important part, before developing the research measure for Company X. Different approaches and theoretical backgrounds suggested, which tools could be adopted for this particular research. The choices are explained in the part below, describing the theoretical framework of the research.
Theoretical framework
Using the analysis of the theory above, the theoretical framework for the empirical research to Company X was developed, fragmenting the concepts of emotional intelligence and organisational climate into dimensions. Emotional intelligence test, developed by Schutte (1998), is often used in various business studies because of the brevity, self-reported type, reliability and LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 32 validity (Jonker & Vosloo, 2008). The dimensions of emotional intelligence were also determined based on Schutte’s dispersal of emotional intelligence. The studies, discussed before, suggest and prove the relation between emotional intelligence and organisational climate, so the next part of the framework concentrates on organisational climate. The composition of this framework varies, because it can be changed based on the organisation, its structure and other specialities (Schneider, 2000). The model of Furnham & Goodstein (1997) was chosen and adopted for this research, because of proven validity, reliability and particularity. The original framework was adopted to Company X, by applying the suggestions, developed during empirical research of Stringer (2002). In summary, the theoretical framework for Company X was developed using two mains concepts – emotional intelligence and organisational climate, supposing that emotional intelligence of the leader and the level of organisational climate within the team are interrelated. (See Figure 1 below).
Figure 1 Theoretical framework Emotional Intelligence Organisational climate 1. Appraisal and expression of 1. Clarity emotions 2. Communication 2. Understanding of emotions 3. Responsibility 3. Regulation of emotions 4. Teamwork and support 4. Utilisation of emotions 5. Commitment
Source: Schutte, 1998 Source: Furnham & Goodstein, 1997; Schneider, 2000; adapted by the author
Emotional intelligence has many different antecedents, which could predict the level of
EI, as locus of control or thin mental boundaries (Barbuto & Story, 2010). EI also depends on age (Fariselli et al., 2006), gender (Sanchez-Nunez et al., 2008) and family background (Naghavi
& Redzuan, 2012). It indicates that the level of EI of the leaders in Company X should differ, because there is no pre-test before recruiting, which would include EI or some of its dimensions. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 33
Organisational climate, even though is often applied to the whole organisation, can differ on the team or department level, depending of the psychological wellbeing, leadership, collaboration, etc. (Schneider, 2000; Isaksen & Ekvall, 2007). The level of EI of the team leader also can predict the extent of organisational climate (Yoder, 2006). Based on these theoretical foundations, three hypotheses for empirical research in Company X are formulated:
H1 – there is a statistically significant difference of level of emotional intelligence between team leaders in Company X.
H2 – there is a statistically significant difference of level of organisational climate between teams in Company X.
H3 – there is a relationship between emotional intelligence of the team leader and organisational climate of the team.
Research method and data collection method
Quantitative research method was selected to conduct this study. Quantitative research is a formal and systematic approach, in which numerical data is used to describe different variables and analyse relationships among them, providing possible causes and effects (Burns & Grove,
2005). This type of the research was chosen due to several reasons. First of all, it allows involving a higher amount of participants, despite time and geographic restrictions, as part of the sample is in the U.S. Also, it eliminates the possible subjectivity of the researcher, because in quantitative research the data is interpreted in numerical terms. The topic of the research itself also prompted to conduct this method, because both concepts, especially emotional intelligence, have very clear and strict structured questionnaires, where no personal interpretation could be involved. The quantitative research method also allows comparing and relating different variables, finding interconnections and possible causes or outcomes. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 34
The method for the data collection is a questionnaire, which aimed to find out the level of organisational climate among different work teams at Company X and emotional intelligence of the leaders of these teams. The survey was distributed personally via work emails, explaining the field and general purpose of the research, with a link to the questionnaire. The emails were sent at the beginning of the November, giving one-week time for the filling the questionnaires. One day before the deadline, electronic notifications were sent once again, in order to remind and get as many answers as possible. All the procedure was operated together with HR and marketing managers in both, Company X in Lithuania and Company X in the U.S. Research was drawn up into English language, in order not to have any bias due to translation, having in mind that all the employees of Company X in both, Lithuania and the United States, are obliged to have proficient level of the English skill. The survey was distributed to specific teams, which were selected. The results of the questionnaire could be found at surveymonkey.com platform, using following sign- in details: user name: [email protected]; password: FBTsurvey.
Research samples and sampling procedure
The participants of this research were employees of Company X in the U.S. and
Company X in Lithuania in Lithuania. The main criterion was to select the teams, which have at least 10 members and are at the same level of hierarchy. Both these requirements were suggested by the Company X’s HR department, in order to have reliable data, which could be compared team by team. The number of employees, which meet the criterion, was calculated, determining the population of 2246 employees. In order to make valid research, the representative size of the sample was determined. The sample size was calculated using a formula for discrete variables, developed by Cochran (1977). LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 35
Explaining the formula as follows:
n – sample size;
Z2 – standard normal distribution;
p – proportion of the population;
d – sampling error.
Standard normal distribution (Z) was used 95%, which is the most common choice of business and other researches (Cook & Sarah, 2004). Therefore, the standard deviation for the formula is 1,959. The proportion of the population (p) was calculated by dividing the number employees, who satisfy the criteria, by the overall number of employees in Company X, getting p=0,898. Sampling error (d) was chosen 5%, d=0,05.
So, the sample size for this particular research is:
1,9592 (0,898(1 0,898)) 3,838* 0,091 n = 141 0,052 0,0025
The approval from the vice president and head of human resource department was given to select 25 teams, 10 from the U.S. and 15 from the Lithuania, and distribute the survey for the members of the teams and their leaders. The teams were selected randomly. The questionnaires were distributed to 529 team members and 25 team leaders, making an overall number of survey distribution of 554, considering that not all people would fill in the questionnaire, because of low participation rate in similar projects before. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 36
Research instruments
There were two different types of questionnaires, provided for this research, one for the team leaders, and another – for the team members. The team leaders were asked to fill self – reported emotional intelligence test (SSEIS, Schute, 1999) (The survey can be found here: https://www.surveymonkey.com/r/CBJDKM9). The reliability of the measure by its authors was calculated as 0,9. The questionnaire consists of 33 items valued in Likert scale, where ‘totally disagree’ gives 1 point and ‘totally agree’ 5 points. Three items were coded conversely – 5, 28 and 33. Before the analysis of the data, the results of these questions were reversed back, in order to have more convenient data analysis. This questionnaire has specific way of analysis, because the results should be represented as the sum, not as an average. The sum of the points can fluctuate from 33 to 165. The value of the number represents the level of emotional intelligence, meaning that the higher the sum of points the higher the level of emotional intelligence (Schutte et al., 1999). The questionnaire is divided into 4 dimensions: appraisal and expression of emotions, understanding of emotions, regulation of emotions and utilisation of emotions. The participants were not aware, what is measured (See Appendix 2). The deployment of the questions, measuring emotional intelligence, based on dimensions, is as follows (Palmer, 2003):
Appraisal and expression of emotions – 2, 3, 10, 14, 23, 28, 31, 12, 21.
Understanding of emotions - 1, 8, 4, 6, 11, 13, 16, 24, 26, 30, 33.
Regulation of emotions - 5, 15, 18, 25, 29, 32, 9, 19, 22.
Utilisation of emotions - 7, 17, 20, 27.
As the foundation for the organisational climate survey The Organisational Climate
Questionnaire (OCQ), developed by Furnham & Goodstein (1997), was used. (The survey can be found here: https://www.surveymonkey.com/r/CRNYY68). The scale was adapted to the LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 37 organisation and the purpose of the research based on Schneider (2000) empirical recommendations. The questionnaire consists of 25 items, which are measured using a Likert scale (1-strongly disagree; 5-strongly agree) (See Appendix 3). The concept is divided into 5 dimensions: clarity, communication, responsibility, teamwork and support, commitment, assigning 5 items for every dimension. The following questions which were coded conversely, -
2, 4, 5, 20. The results were converted back before the further analysis. For the analysis of results, the means were taken. The deployment of the questions of organisational climate, based on dimensions, is as follows (Furnham & Goodstein, 1997; Subramanian & Shin, 2013):
Clarity – 1, 2, 3, 4, 5.
Communication – 6, 7, 8, 9, 10.
Responsibility – 11, 12, 13, 14, 15.
Teamwork and support – 16, 17, 18, 19, 20.
Commitment – 21, 22, 23, 24, 25.
Both questionnaires also included general information about the gender, nationality, age and how long the respondents had been working in Company X.
Data analysis methods
SPSS (Statistical Package for Social Science) was used for data analysis. All the data of the team leaders, was analysed separately, evaluating the reliability of the data, transformed info numerical output and further analysed. The thorough analysis of the results requires different data analysis methods. For this research the following data analysis methods were employed:
Cronbach’s alpha test, one-way ANOVA, One-sample T-test and Pearson correlation.
Cronbach’s alpha test. By using this tool, it can be determined if the data collected is valid for further analysis and also helps to have accurate results in the interpretation of the data LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 38
(Tavakol & Dennick, 2011). The value of α represents the level of internal consistency (George
& Mallery, 2003). This type of evaluation is summarised in the table (See Table 6).
Table 6 The meanings of Cronbach’s alpha values Cronbach's Internal alpha consistency α ≥ 0.9 Excellent 0.9 > α ≥ 0.8 Good 0.8 > α ≥ 0.7 Acceptable 0.7 > α ≥ 0.6 Questionable 0.6 > α ≥ 0.5 Poor 0.5 > α Unacceptable Source: George & Mallery, 2003
One-way ANOVA. This tool is used to compare the means of multiple samples with numerical data (Howell, 2002). The main purpose of this method is to determine, whether the difference between selected samples or groups is statistically significant. It is confirmed by the p value, which should be less than 0.05.
One-sample T-test. It is used for comparing sample with known or hypothesised population mean, seeking to determine, if the variables of the sample are statistically different from the population, using p value (p <0.05 – there is a statistically significant difference) (Box et al., 2005).
Pearson correlation. This method is designed to determine if there is any linear correlation between two variables (Gayen, 1951). It is often used as a primary tool during the analysis of possible interdependence of two variables. P value of 1.00 indicates strong positive correlation; 1.00 – negative correlation; 0 – no correlation (Cohen et al., 2003). LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 39
Data analysis results
First of all, the analysis will describe demographic characteristics, using descriptive tools.
The age, gender, nationality and work period will be considered. Moving on, the two concepts namely organisational climate in the teams and emotional intelligence of the team leaders, will be analysed separately, evaluating the reliability of the data, overall level of the measure, thorough analysis of the items in the questionnaires, differences among teams and possible interrelations between the variables.
Demographic characteristics. There was a total of 173 answers, from which 18 answers were not included in further analysis due to misleading coding. 143 of these respondents were members of teams and 12 were team leaders. First of all, data were analysed using descriptive statistics and calculating frequencies (See Appendix 4). All in all, 123 women (~79%) and 32 men (~21%) participated in the survey. The higher percentage of women was natural, because similar distribution of gender is present in these selected departments. Separating by age, the respondents group can be divided into two main categories – age 18-24 – 76 participants (49%) and 25-34 – 61 participants (40%). The older employees make the remaining 11%.
Geographically, the questionnaires were distributed for two offices of Company X – main office in the U.S. and service centre in Lithuania. 80% of the employees participating in this survey were from Lithuania and 20% from the U.S. The period, of how long the employees have been working in Company X, was also taken into the consideration. The highest percentage is of the newcomers, who have been working for less than 6 months - 56 respondents (36%). 39 have been working for 6-12 months and 45 for 1-2 years, making 25% and 29% respectively. Those, who work in Company X longer than 2 years form a minority of 15, making 10% of the total research sample. All this descriptive data is summarised in the data below (See Table 7). LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 40
Table 7 Demographic characteristics GENDER AGE WORK LENGTH Female Male 18-24 25-34 35-64 <6 6-12 1-2 >2 months months years years 123 32 76 61 18 56 39 45 15 Source: Compiled by the author
Reliability of the data. First of all, before making any other analysis, the reliability of the data should be checked, for both – organisational climate and emotional intelligence concepts.
Emotional Intelligence. Even though the measure of emotional intelligence used in this research is standardised and empirically tested, the reliability of this particular research was analysed too. First of all, the distribution of the data was analysed, finding out one, outlier (Team
12 – EI=91). The outlier was not eliminated from the further research, because Cronbach’s Alpha test was used, which confirmed the reliability of the data – α=0,876, including the results of all leaders (see Table 8). Additional to these tests the difference between genders was also analysed.
The calculations showed that there was no significant difference between genders in evaluating the emotional intelligence (p=0,934). One-sample T-test was used for finding out if there is a significant difference between the team leader’s emotional intelligence of Company X with assumed population mean. The population mean was retrieved from Malouf (2014), who concluded that the average EI of wide samples is 124, using Schutte’s questionnaire of emotional intelligence. The use of this test concluded that there is no significant difference between the emotional intelligence of leaders with an assumed population mean (p=0,703), suggesting that the team leaders in Company X have statistically similar levels of emotional intelligence (see LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 41
Table 9). These results have rejected Hypothesis1. Some exceptions as specific cases will be discussed in further parts of the thesis.
Table 8 Table 9 Reliability statistics for EI One -sample T-test for EIOne-Sample of leaders Test Reliability Statistics Test Value = 124 Cronbach's 95% Confidence Interval of the Alpha N of Items Mean Difference ,876 33 t df Sig. (2-tailed) Difference Lower Upper EI -,391 11 ,703 -1,417 -9,39 6,56
Source: Compiled by the author Source: Compiled by the author
Organisational Climate. The questionnaire of organisational climate was created by involving some parts of different measures, in order to adopt the survey particularly to Company
X. Therefore, the reliability of the data is the main criterion, before making further analysis. For this purpose, the reliability analysis by using Cronbach’s alpha test was used.
First of all, the reliability of the whole organisational climate questionnaire (N=25) was calculated, having the result of α being 0,893, corresponding to the internal consistency as
“good” (See Table 10). After the evaluation of the whole sample, the reliability of different teams was assessed, using Cronbach’s alfa and histogram charts. The analysis concluded that the answers of two teams are not normally distributed and therefore not reliable, so these two teams
(Team no. 5 – α=0,329; Team no. 13 – α=0,244) were deleted from the data for further analysis.
Table 10 Reliability statistics for Organisational Climate Cronbach's Alpha N of Items ,893 25 Source: Compiled by the author
The next step was to check, if the level of organisational climate is the same in the whole organisation. The Hypothesis 2 suggested that there was a statistically significant difference of LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 42 level of organisational climate between teams in Company X, meaning that Company X has no single organisational climate; it differs from team to team. For the analysis of this hypothesis one-way ANOVA was used (see Table 11). The test confirmed that there was a statistically significant difference of organisation climate between teams (p=0,010). The same method was also applied to all dimensions of the organisational climate separately, seeking to analyse, which dimensions are creating the difference. The statistically significant difference between groups were found for teamwork – p=0,019 and commitment – p=0,004. The significant differences between genders were not found, same as in testing gender influence on emotional intelligence
(p=0,983). The differences between groups raised the question what had an impact on the organisational climate between teams.
Table 11 One-way ANOVA test: OrganisationalANOVA Climate
Sum of Squares df Mean Square F Sig. SUM Between Groups 3782,772 12 315,231 2,339 ,010 Within Groups 16175,619 120 134,797 Total 19958,391 132 Clarity Between Groups 117,066 12 9,755 1,463 ,148 Within Groups 800,182 120 6,668 Total 917,248 132 Communication Between Groups 157,644 12 13,137 1,436 ,159 Within Groups 1097,665 120 9,147 Total 1255,308 132 Responsibility Between Groups 175,383 12 14,615 1,828 ,051 Within Groups 959,430 120 7,995 Total 1134,812 132 Teamwork Between Groups 212,387 12 17,699 2,143 ,019 Within Groups 991,132 120 8,259 Total 1203,519 132 Commitment Between Groups 428,926 12 35,744 2,620 ,004 Within Groups 1637,329 120 13,644 Total 2066,256 132
Source: Compiled by the author
The analysis of the concepts. First of all, these two concepts are analysed separately, using descriptive statistics, in order to determine the general level of emotional intelligence among the leaders and organisational climate among the teams, highlighting strong and weak LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 43 points of these selected teams. Moreover, some assumptions and data interpretations will be provided, which indicate the areas of Company X, which need further development.
Emotional intelligence. The level of EI is measured as a sum of all points, indicating that bigger sum of points reflects a higher level of emotional intelligence. The employed SSEIS measure tool has the scale, where the minimum sum of points is 33, and maximum – 165. An average level of emotional intelligence between 12 leaders in Company X is 123, with standard deviation of 13. These results reflect quite exactly many research of large samples, where the average is 124, with the same standard deviation of 13, proposing that emotional intelligence below 111 is low and above 135 – high (Mallouf, 2014). The main part of the leaders in this research fall into this range, just one having the level of EI lower (91) and two – higher (136;
139). This means that the most of the team leaders have average emotional intelligence, which should not have any higher impact on the leader’s performance. This empirical data is provided in the table below (See Table 12), where American teams are Team 1 and Team 15.
Table 12 The level of EI and EI dimensions of team leaders Emotional Intelligence Team Overall EI Appraisal Understanding Regulation Utilisation number (min.33; (min.9; (min.11; (min.9; (min.4; max.165) max.45) max.55) max.45) max.20) Team 1 118 35 39 29 15 Team 2 136 40 45 35 16 Team 3 120 38 36 33 13 Team 4 125 34 41 34 16 Team 6 130 34 45 35 16 Team 7 130 33 43 38 16 Team 8 118 35 40 31 12 Team 9 123 39 37 31 16 Team 10 128 36 41 36 15 Team 11 139 41 44 38 16 Team 12 91 22 29 30 10 Team 15 113 33 33 35 12 Source: Compiled by the author LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 44
Even though the average of the level of EI among researched leaders of the teams is normal, with no particular dimension valued lower than others, there are some separate items, which have low results among all the leaders. Analysis of these questions could identify the possible direction of the training, since emotional intelligence could be developed (Goleman,
2000). The lowest points are given to the question, which belongs to the “Understanding the emotions” dimension. This is the 11th item of the questionnaire, which reflects on sharing emotions “I like to share my emotions to others”. The average evaluation of this question is 2, 83
(max. 5). This is only one item, which has lower than 3 points evaluation. Second lowest score is
3, 42. It indicates that these team leaders have difficulties sharing their emotions, which could be related to the ability to solve the conflicts, ask for help and create positive interpersonal relationships (Rime, 2007). Also, the item described as “When I experience a positive emotion, I know how to make it last” is evaluated relatively low. From the comparison of this question to overall level of particular dimensions, it can be assumed that even though these leaders are able to understand their emotions and manage them well, when they appear, they cannot invoke them.
It might be that the team leaders are able to control their negative emotions and diminish them, though having difficulties in boosting positive feelings.
The other lowest evaluated items mostly reflect to these dimensions: understanding the emotions of others and regulation of emotions (Q6; Q29; Q33). By summarising the results of these questions, it can be concluded that it is relatively difficult for team leaders to empathise with other peoples’ experiences, recognise their emotions from visual appearance and understand the reasons of their feelings. All these items reflect to the ability to be emphatic, whereas empathy is the capacity to see, understand and experience inside the emotions of other people
(Bellet et al., 1991). Empathy is a critical success factor for leaders, because just empathic LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 45 leaders can build trust with their team members (Goleman, 2003). The ability to understand the feelings of subordinates and to empathise with their emotions can help to increase collaboration, improve psychological well-being (Kettenhofen, 2014).
The HR management in Company X does not use any measurement of EI before hiring or promoting team leaders, therefore there is no indication of the EI level relationship to other variables, as productivity, retention rate, etc. Even though there is no statistically significant difference in the level of EI among these team leaders, there are some exceptional leaders, who have low or high emotional intelligence. High performers of EI (136 and 139 points) can be distinguished by very high scores in one particular dimension – appraisal and expression of emotions, whereas the having team leader with the lowest EI (91 points) also has the lowest scores in the same dimension. It can be interpreted, that appraisal and expression of emotions is the major index, which can predict the overall level of EI.
Organisational climate. The deeper insights should be taken to the organisational climate concept, whereas the differences between teams are significant and the average of the measure is not high. The measure, used to determine organisational climate among the teams, is suggested in calculating means, not the sums, therefore further analysis will be made using means. The mean of organisational climate in Company X, based on these 13 teams, is 3, 77, whereas the maximum of this concept is 5. First of all, the strengths of organisation climate perceptions in
Company X will be provided. Secondly, the general weak points of organisational climate will be described, analysing every question and searching for common low evaluations.
In order to conduct this analysis, the means of every question for every team was calculated, highlighting the evaluations that are below team’s average (See Table 13).
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 46
Table 13 Means of every OCQ item for the teams in Company X Clarity Communication Responsibility Teamwork Commitment Team Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 Q13 Q14 Q15 Q16 Q17 Q18 Q19 Q20 Q21 Q22 Q23 Q24 Q25 average Team 1 4,42 3,42 3,79 4,11 2,95 3,11 4 3,95 3,42 3,42 3,42 3,32 3,63 3 3,63 3,21 3,32 2,89 3,63 3,05 3,47 3,58 3,84 4,05 3,58 4,00 Team 2 4,11 3,67 3,56 4,33 2,78 2,78 3,78 4 3,67 3,56 3,89 3,33 3,44 3,44 3,89 3,11 3,11 2,89 3,11 3,89 3,56 3,33 4 4 4 3,53 Team 3 4,5 3,13 3,75 4,88 4 3,5 4 4,25 4,13 4,38 4 3,75 3,63 3,63 4,13 3,5 4,13 3,63 3,25 4,63 3,88 3,75 4,63 4,38 4,25 3,57 Team 4 4,5 3,5 3,5 4,88 3,5 4,38 4 3,88 3,75 3,88 4 3,5 3,63 3,25 4,13 3,38 2,88 3,5 4 3,88 3,75 3,88 4,5 3,88 3,63 3,99 Team 6 4,4 4 3,8 4,6 1,8 3,8 4,4 4 4,4 4,6 4,6 3,8 4,4 4,2 4,4 4,6 4,6 3,6 4,4 4,8 4 3,8 4,2 4,8 4,6 3,82 Team 7 4,46 3,08 3,92 4,62 4 3,31 3,54 4,31 4,08 3,85 3,92 3,62 3,62 3,23 4 3,46 3,85 2,85 3,54 4,31 3,77 3,85 3,92 4,31 4,08 4,18 Team 8 4,38 2,88 3,38 4,38 3,88 3,5 3,38 4,13 4,5 3,63 3,88 3,75 3,63 4 3,63 3,5 3,63 3,5 3,88 3,75 3,38 3,38 3,63 3,88 3,88 3,82 Team 9 4,08 3,83 3 3,92 3,25 3,08 3,25 4,33 3,75 3,17 3,42 3,25 3,33 3,25 3,33 3,25 3,5 3,08 3,83 3,67 2,83 3,33 3,58 3,25 3,17 3,73 Team 10 4,33 2,67 2,5 4,5 2 3 3,17 4,17 4,17 3,33 3,17 3,33 2,83 3,5 3,33 3,67 4 2,67 3,67 4,33 2,83 2,67 3,17 3,33 3 3,43 Team 11 4,38 3,5 3,75 4,44 3,06 3,31 4,25 4,19 4,06 4 4,38 3,81 3,63 3,63 3,69 3,44 3,44 2,81 3,75 4 3,63 3,94 4,31 4,44 4,44 3,33 Team 12 4,5 3 4,25 4,75 3,25 3,75 4,25 4,5 4,25 4,5 4 3,75 3,25 3,75 3,75 4 3,75 3,25 2,75 3,75 3,75 3,75 4,25 4,25 3,75 3,85 Team 14 4,14 3,36 3,57 4,86 3,64 3,14 4,29 4 4 4,07 4,07 3,79 3,21 3,21 3,93 3,71 3,79 2,71 3,79 4,21 4 3,64 4,43 4,5 4,21 3,87 Team 15 4,55 3,36 4,36 4,27 3,27 3,45 4 4,55 4,36 3,73 4,09 3,73 3,82 3,55 4,18 4,18 4 3,82 3,45 3,64 4 4,09 4,36 4,64 4,64 3,85 Average 4,35 3,34 3,56 4,52 3,18 3,39 3,86 4,14 4,01 3,86 3,89 3,58 3,52 3,51 3,82 3,57 3,66 3,12 3,63 4,02 3,57 3,57 4,04 4,09 3,88 3, 77 3,8 3,87 3,68 3,6 3,9
Source: Compiled by the author
As it can be already visually seen from the table, there are some questions, which are valued very low and conversely – very high. When talking about evaluation of the separate dimensions, responsibility and teamwork are valued the lowest, whereas commitment and communication score most. Clarity dimension has an intermediate evaluation. However, the difference between the scores of dimensions is not high, therefore, questions will be analysed separately and grouped by common elements for further analysis.
Firstly, taking a deeper look at the highest evaluation items, there are 3 questions, which could be clearly distinguished from others because of mean 4,1 and above (see Table 14 below):
Table 14 Highest evaluated items of OC in Company X Nr. Abbreviated question Average evaluation among teams Q1 Clear goals and objectives 4,35 Q4 Easiness of ask for help the team leader 4,52 Q8 Clearly vision about contribution to the company 4,14 Source: Compiled by the author
Members of every team agree that they have clear goals and objectives for their jobs, understand clearly, how they can contribute to the general goals of the company and admit that it LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 47 is easy to ask for help of the team leader. This indicator is very important, because having specific goals for employees increase the intrinsic motivation and work effort (Dysvik & Kuvaas,
2013).
Analysing the negative aspects of organisational climate in Company X, there are two dimensions with lowest means of ~3,6 – responsibility and teamwork, where the majority of questions is evaluated comparatively low (See Table 15).
Table 15 Least evaluated items of Responsibility and Teamwork dimensions of OC Nr. Abbreviated question Average evaluation among teams Q12 Allowance to participate in relevant decision making 3,58 Q13 Given responsibility just for relevant tasks 3,52 Q14 Leaders’ willingness to consult about decisions 3,51 Q16 Low work pressure by colleagues 3,57 Q17 Work pressure is not excessive 3,66 Q18 Appropriate work and time balance 3,12 Q19 Adaptability of work methods 3,63 Source: Compiled by the author
Analysing responsibility part, there are three questions, which have relatively low evaluations (Q12-14). Team members do not agree that they are allowed to participate sufficiently in significant decision that affect their work. It could be due to several different reasons. Team leaders could not involve their subordinates in decision making, but also it could be that the positions are very clear and specific, where no impact could be made at all. Analysing further items, team members feel that they are given more responsibilities than they can actually influence. Teamwork dimension has even 4 out of 5 questions, having evaluations below average
(Q16-19). All the teams agree that there is too much work and not enough time (Q18). More than half of respondents confirm that they feel pressure from their colleagues, the pressure is excessive and the work methods are changed to meet new conditions rather slowly (Q16; Q17;
Q19). LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 48
Analysing other three dimensions, each of them also has one or two questions, which should be taken into the consideration (See Table 16).
Table 16 Other least evaluated items of OC in Company X Nr. Abbreviated question Average evaluation among teams Q2 Leader’s intolerance for poor performance. 3,34 Q5 High turnover of staff in the team. 3,18 Q6 Efficient use of time by colleagues. 3,39 Q21 High motivation level in the team. 3,57 Source: Compiled by the author
Many teams have an opinion that their leaders are too tolerant for poor performers, also acknowledging that the turnover of the team is high (Q2; Q5). Most of the teams disagree that people in the team do not spend too much time on unessential (Q6), also contradicting to the proposition that motivation is kept at high levels in the team (Q21). The results between the U.S. and Lithuania do not differ a lot, but two remarks could be retrieved. The American teams (Team
Nr. 1 and Team Nr. 15) more feel strong sense of job satisfaction (M=4, 08), whereas the
Lithuanian teams average is 3, 54 (Q3). However, teams from the U.S. agree that mistakes are held against the person, conversely to the teams from Lithuania (Q20).
Another important part of the analysis is to compare the teams, which have high general evaluation of organisational climate with the teams with low results of the measure. Overall, top and bottom teams have higher or lower averages of questions in general. However, some questions differentiate these teams, when analysing the evaluation of the answers not in values between the teams, but based on the positions (above or below average) within the team. Best organisational climate having teams could be distinguished by relatively high scores in the following indicators: sufficient amount of information for decision making, not excessive work pressure and also most of the parts of commitment dimension, especially the leader’s ability to LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 49 solve the problems, proud of being part of the team and feeling of appreciation being a member of the team.
Analytic data processing of organisational climate. As mentioned previously, there are significant differences between the level of organisational climate among the teams, therefore analysis of overall averages could not provide all the sufficient information for further development of the concept. In order to define, which aspects of organisational climate should be considered and which means should be applied, the evaluation model of importance was adapted from Furnheim & Goodstein (1997), the initial authors of the organisational climate questionnaire. This model has been made as a matrix, where questions are plotted against two variables – performance and frequency. Performance implies for an average of all teams’ evaluation on every question, whereas frequency represents the number of teams, which have evaluated this question below an average team’s evaluation of organisational climate in general.
This two-dimensional analysis is needed, because the low average in general does not necessarily address the problem of the whole company. Very poor performance in just few teams could distort the current situation in Company X. Therefore, frequency was chosen as another variable, which could help to identify the importance of every item’s score. Applying this tool, all the questions are placed in the matrix, which consists of four parts (See Table 17).
Table 17 Theoretical model of Organisational Climate PERFORMANCE Low High FREQUENCY High Fix Ignore Low Consider Celebrate Source: Adapted from Furnheim & Goodstein (1997), compiled by the author
The above presented matrix divides all the items into four courses of actions: LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 50
Fix: This category involves those items, which have a low average evaluation between the teams and high frequency, meaning that items have been frequently evaluated as relatively low. This part of the framework requires the most attention, because it identifies the weaknesses of the company, when considering organisational climate, and provides particular problems, which should be solved, in order to improve organisational climate and overall well-being of the employees within the company.
Ignore: This part is rather not important, because it claims that items have high evaluations, but also are frequently marked as “below teams’ average”. It just emphasises the high organisational climate evaluation, having a very high average in all teams at every question.
So this part should be left out and praised as having the best scores of organisational climate without further need or apparent direction for improvement.
Consider: This section of the model represents the items, which have both – low averages and low frequencies, suggesting that even though there is low performance of particular questions, the importance in not so high, because just a few teams agree with that, meaning that these are more like separate problems to specific teams rather than to the whole company.
Despite that, these items could be considered, if it is easily applicable and feasible for the improvement.
Celebrate: The items in this part could be defined as strengths of the company in the context of organisational climate. The questions, which belong to this category, have high average scores and are just for few teams or even for no team as a weakness, having evaluations below team’s average. The company can be sure that these factors are managed well and there is no need for any intervention. It is worth mentioning though, that the actions towards these items LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 51 should be maintained while the company implement strategic decisions, facing other important aspects of organisational climate.
Using this matrix, all 25 questions of the organisational climate questionnaire in
Company X, were placed in previously described model (Figure 2).
Figure 2 Matrix of Organisational Climate in Company X 13 18 FIX IGNORE 12 6 21 13 11 2 12 10 5 14 9 3; 16 8 22 17 7 19
6 CONSIDER CELEBRATE Frequency 5 7; 10 4 15 25 3 11 20 2 9; 23 24 1 8 0 1 4 3 3,2 3,4 3,6 3,8 4 4,2 4,4 4,6 4,8 5 Performance
Source: Compiled by the author, based on Furnheim & Goodstein (1997) model
The model is developed based on previously described matrix, where the x axis represents the overall evaluation of particular items of organisational climate. The scales of axes were adapted from Furnheim & Goodstein model (1997). Y axis describes frequency in scale from 0 to 13, 0 meaning that – no team has evaluated this item below average and 13 meaning that – all the teams evaluated this item below average. The numbers near the data point reflect the numeration of questions in the questionnaire. Based on the matrix above, the parts of LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 52 organisational climate will be analysed, developing practical implications for further development, if needed, concentrating on the “fix” part.
Firstly, there are no items at the “Ignore” part, which signalizes that the overall organisational climate is not high and therefore there are no items with high average being frequently evaluated as relatively low.
The next part, labelled “Celebrate”, indicates the strengths of organisational climate in
Company X. They can be divided into two main categories – goal setting and the leader’s role.
The results of the overall model are summarised in Table 18. The majority of teams has clear goals and value their leader as a person, which can help and solve the problems. It proves that management of the company is able to set concrete directions for employees and create a clear vision of how they should operate in order to achieve both, personal and corporations’ development. The meetings strategy of Company X concentrates on often individual and team meetings with team leaders, managers, representatives of general office, might be the initial reason, why goals are set efficiently. This strategy will not be effective without constructive and easily approachable leaders. The team leaders of Company X, who had participated in the research, have the capabilities to manage relevant problems, be accessible and empower subordinates, which are the main qualities of effective leaders (Hassan et al., 2013).
The questions under the consideration can be divided into 3 directions – information provided to the team; coordination of work and conflicts by the team leader; well-being within the team. These are not urgent and common problems of Company X, but the company should think about the improvement of these spheres, especially for particular teams. These results show that the leaders of some teams are not able to solve conflicts constructively, communicate all necessary information. Due to judging the behaviour of team members’ or their leaders’ quite a LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 53 few teams feel unvalued and accused because of mistakes at the workplace. Lack of information can have a direct impact on productivity of employees. It causes frustration and decreased quality of the performance (Bruce & Katcher, 2015). Also “being valued” is a very important condition to effective work, because the employees, who feel valued, tend to be much more engaged to work (Claxton, 2014). In order to address these problems, the last part of the thesis will involve some solutions, which also should improve the items of consideration.
The most attention should be paid to the section “fix”, because items there have repetitive low evaluations. All questions were divided into 4 categories: workload, team management, teamwork and commitment. The research showed that employees feel pressure at work due to too large work load and also think that they are not sufficiently involved in decision making, having rather poor conditions to adapt to changing conditions of work, being put under the pressure of their colleagues. Discontent about the workplace is proved by the low evaluation of job satisfaction. All these factors are the weaknesses of Company X, therefore the last section of the thesis will be dedicated to assess this problem and suggest practical solutions.
Table 18 Practical adaptation of the matrix to the Company X’s research Course Categories Questions, describing categories of action CELE- Goal setting Q1. I have clear goals and objectives for my job. BRATE Q8. I understand clearly how contribute to general goals of the company. Leader’s Q4. It is difficult to ask the team leader for help. role Q9. I have adequate opportunities to express my views in my team. Q23. The leader always solves the vast majority of important problems. Information Q7. Team receives all the information it needs to carry out its to the team function well. CONSI- Q15. I’m kept well enough informed for me to make decisions well. DER Coordinatio Q10. Conflicts are constructively/positively resolved in the team. n of work Q11. The work of the team is well-coordinated. Well-being Q25. I feel that I am valued member of the team. in the team Q20. If you make an error in this team, it is often held against you. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 54
Workload Q18. There is rarely too much work and too little time. Q13. I am made responsible only for those things I can influence. Q17. I do not feel that the pressure of work is excessive. FIX Team Q5. There is a high turnover of staff in this team. managemen Q19. Work methods here are quickly changed to meet new conditions. t Q12. I am allowed to participate sufficiently in significant decisions that affect my work. Q2. I think my team leader is too tolerant for poor performers. Team work Q6. People in the team do not spend too much time on unessential. Q16. I am rarely put under undue work pressure by my colleagues. Commitmen Q22. The commitment of the staff is high in this team. t Q3. I feel a strong sense of job satisfaction.
Source: Compiled by the author
The relationship between team’s organisational climate and leader’s emotional intelligence. The data from 12 teams were involved in this analysis, making the overall scale of
145 people. One team was not included, because the data was not complete, having no answers of the team leader. One of the main hypotheses of the research was formulated as follows: H3– there is a significant relationship between team leader’s emotional intelligence and organisational climate in the team. It was investigated by applying Pearson correlation coefficients. The correlation between these two variables was defined as not significant
(p=0,740). There were no correlations found also by comparing different dimensions (See Table
19 and Appendix 5). These results rejected the hypothesis and suggested the conclusion that the difference of organisational climate between the teams in Company X is influenced by other factors, rather than emotional intelligence of the team leader. No significant differences in EI level of team leaders, which described in previous sections, have already suggested that there could be no direct relationship to organisational climate, which differs significantly from team to team.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 55
Table 19 Pearson correlations between EI and OC and their dimensions Variable 1 2 3 4 5 6 7 8 9 10 1.EI 1 2.Understanding ,920** 3.Regulation ,683* ,574 4.Utilisation ,869** ,828** ,480 5.Appraisal ,840** ,639* ,353 ,666* 6.OC -,107 -,023 -,200 -,208 -,284 7.Clarity -,298 -,296 -,045 -,301 -,306 ,689* 8.Communi- -,373 -,262 ,057 -,416 -,543 ,908** ,594* cation 9.Responsibility ,090 ,236 ,232 -,055 -,123 ,935** ,491 ,807** 10.Teamwork ,062 ,139 ,239 -,024 -,118 ,665* ,027 ,608* ,712** 11.Commitment -,036 -,009 ,246 -,145 -,170 ,912** ,785** ,759** ,811** ,362 Source: Compiled by the author
Even though there is no significant relationship, some relations could be seen, by comparing different parts of these concepts, which might have some assumed connections. In order to reveal that, the evaluation of EI dimensions and grouped items of OC will be taken. Firstly, sections of the “Consider” part were selected, because items in this section were evaluated low just from particular teams, therefore, the EI dimensions of these teams’ leaders were be compared.
Taking into account coordination of work and questions, describing this section, there are two teams, which have evaluated both questions below teams’ average. Comparing the results of
EI of the leaders, dimension “Regulation of the emotions” can be clearly distinguished from other teams. Even though the differences are not significant, but these particular leaders have lowest evaluation in this dimension, despite one outlier, which results significantly lower in all dimensions (See Table 20).
Table 20 Comparison coordination of work to specific dimension of EI Coordination of work Regulation of Q10 (OC) Q11 (OC) emotions (EI) Team 1 3,42 3,42 29 Team 9 3,16 3,42 31 Average 3,85 3,91 34 Source: Compiled by the author LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 56
Additional attention should also be paid to Team 12, because the EI level of the leader of this team falls significantly below average, giving the evaluation as “low EI” (Mallouf, 2014). The leader of Team 12 has an EI level of 91, while the average of all teams is 123, and the next lowest evaluation is 113. There is no particular dimension of EI, which could be distinguished from others, however, the lowest sum of points is of the dimension “Appraisal and expression of emotions”
(less than a half of the points). There are some items of EI, which have drastically low results in comparison with other teams, concerning communication and attitude to other people. The OC of this team is a little below the average - 3,77 (overall average=3,87). However, there are also some items of OC, which could be distinguished from the results of other teams. In order to make this analysis and compare these elements of both concepts in the Team 12, the table below was compiled, where the results of Team 12 are compared with the average results (the average is calculated excluding the Team 12) (See Table 21).
Table 21 Analysis of Team 12, considering EI and OC EI items Team 12/ OC items Team Average 12/ Average Q1. I know when to speak about my 1.00/ 4,21 Q13. I am made responsible 3,25/3,57 personal problems to others. only for those things I can influence. Q18. By looking at their facial 1.00/ 4,14 Q19. Work methods here are 2,75/3,69 expressions, I recognize the emotions quickly changed to meet new people are experiencing conditions. Q24. I compliment others when they 1.00/ 4,00 Q20. If you make an error in 3,75/4,01 have done something well. this team, it is often held against you. Q30. I help other people feel better 1.00/ 3,86 Q25. I feel that I am valued 3,75/3,96 when they are down. member of the team. Source: Compiled by the author
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 57
Some of the items, represented above, could be logically linked, by also providing theoretical reasoning. Lack of compliments and positive reinforcements, also not helping, when needed, can negatively influence the well-being of employees. Amiel (2015) distinguished effective leaders by their ability to compliment subordinates and give them positive attention. In this particular case, it can be noticed that inability to compliment and help others (EI Q24; Q30) could have an impact on organisational climate of the team (OC Q20; Q25). The leader also has no capability to speak about his/her problems appropriate (Q1) and empathize with other from visual stimulus (Q18), therefore communication and interrelationships within the team could be harmed. The ability of emotion recognition directly influences the behaviour of the leader and creates more supportive and motivating environment for employees (Rubin et al., 2005).
In conclusion, even though the significant relationship between teams’ OC and team leaders’ EI has not been proved by this research, some links can be assumed, by analysing separate parts and theoretical foundations. Also organisation climate of Company X clearly has some weaknesses, which affect the productivity and performance of the teams. The next part will concentrate on concrete practical solutions, which are based on the thorough analysis of the data, retrieved during the research, and can be implemented to the company, in order to solve relevant and important problems.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 58
Managerial solutions
The final part of the thesis is dedicated to the concrete practical solutions for the HR
Management, in order to improve the current situation. As the research and its analysis were concentrated on emotional intelligence of the leaders and organisational climate of the teams, the managerial solutions also are provided based on this dispersal.
Improvement the level of EI for team leaders
Emotional intelligence is one of the main factors of successful leaders. Previously mentioned research suggests that high emotional intelligence usually guarantees better performance at work, higher productivity and career success. The analysed literature also suggested that leaders’ emotional intelligence influences overall organisational climate of the team, which is a very important aspect of the company. Empirical research of the thesis revealed that there is no significant difference among leaders’ emotional intelligence and the level of this measure is high, having no link with organisational climate, suggesting that there is no need for further interventions for leaders’ and their emotional skills. However, since the level of emotional intelligence has an impact on other important variables, and could be developed, some practical implementations for team leaders, addressing their EI, could be made. First of all, the deeper analysis of EI level should be made, in order to be sure about these results. The HR department of Company X could conduct ability-based research of EI for all the leaders, measuring emotional intelligence not just based on self-perception, but on actual use of these skills and abilities. This could be achieved by applying emotional intelligence test tools, which involve comprehensive evaluation, results analysis and report. The next investment into the LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 59 development of leaders should be specific training programs, based on the results retrieved from the tests. They can be both, individual or group based, depending on the results obtained from the EI tests. This can be done either externally or internally, meaning that specific trainings for the development of leaders’ EI could be provided by another company, which specialises in this field, or it could be organised by Company X Human Resource Management team. The practical plan is summarised in Table 22, describing suggested action; level of importance; means, how the action should be implemented; expected outcomes; required budget and time frame.
Table 22 Course of actions for teams’ leaders Action Importanc Means Outcome Budget Time frame e Comprehensiv Medium ECI - 360 Exhaustive €268,8 Two weeks e measurement Emotional evaluation of 6 (ordering, filling, of EI Competence EI of all team evaluation) Inventory leaders Training Medium Emotional Improved level €580 30 trainings for program for Intelligence of EI per 2,5 hours (Total: leaders Training (Social person 75 hours) Games, Lithuania) Internal EI Medium/ E.g. Marieke Improved level No 15 hours for one trainings of High Kingma Empathy of lowest materia dimension particular Training Manual evaluated parts l costs, dimensions for empathy of EI just development labour costs Leadership Medium Multifactor Comprehensiv €27,62 30 minutes of style research Leadership e reports of per filling Questionnaire leadership leader styles, includes strengths and areas for development Source: Compiled by the author
Since the level of EI in Company X meets average recommendations, all the potential actions have medium importance, meaning that the implementation is useful, but not urgent. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 60
Most important is improvement of particular dimensions, which have lowest results and therefore could negatively affect the performance of the leaders. Broader information about the selected means and their budget is provided in Appendix 6.
Improvement of organisational climate of teams
Organisational climate is very important for general productivity and work effectiveness of any company (Glisson & Hemmelgarn, 1998; Zhang, 2010; Janjua, 2014). It also has to be highlighted that one company could have different levels of organisational climate, depending on leader, department, nature of work, team members and other factors (Schneider, 2000). The significant difference of organisational climate between teams in Company X was confirmed by empirical research, described above. The results suggest different areas for development, therefore the next part of the thesis will concentrate on concrete solutions and practical implementations for Company X, in order to improve current organisational climate of the teams, who participated in the research, assuming that some of the problems should be present at the whole corporation. The suggested solutions are prepared intending not just to improve the situation for current employees, but also to help to avoid similar problems with future workforce.
The practical implementations are prepared based on matrix, analysed before, which had divided all the items of OC into four categories. The managerial solutions are prepared for the “Fix” part, because situation of these parts have least evaluations and requires most attention. The “Fix” section, based on the matter of the items, was divided into four elements: workload, team management, teamwork and commitment. Practical solutions will be provided for every dimension separately, assuming that the overall plan would increase the level of OC in Company
X. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 61
Workload. The research revealed that employees feel that the workload is too high, emphasising that often there is too much work and not enough time. Additionally, responsibilities exceed the capabilities and the pressure of work is excessive. Too intense workload has negative outcomes and causes stress at the workplace (Cazabat et al., 2008). Work- related stress has a negative impact not just on personal health and well-being, but also on the whole organisation. It may cause high labour turnover, poor timekeeping, productivity and motivation (Cavanaugh et al., 2000). All these possible outcomes can be seen in the research, confirming that the work-related stress might be a problem in Company X. Organisational stress prevention and reduction most commonly consist of job design, goals and role. As mentioned previously, goal setting is the strength of the company, so management should focus on other aspects. Managers should consider re-designing position requirements for the employees, involving them in the process. The reduction of the workload would be not sufficient, because it would not necessarily eliminate the tasks, which the employees do not feel capable to overcome.
After considering changes and applying them, observation system should be presented, in order to determine if the changes produced positive outcomes. The reduction of stress at the workplace should reduce turnover and increase productivity.
Team management. This part closely relates to previous analysis of workload, because some of the aspects of team management could be the outcomes of mismanagement, when talking about workload. High turnover of staff could be due to stress at the workplace, as mentioned above. The other aspect proves the importance of the practical implementations of the solutions, described in the “workload” part, because lack of possibility for the employees to participate in significant decision making, which affects their work, is another weakness of organisational climate. The perception that team leaders are too tolerant for poor performance LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 62 requires two-sided implication. First of all, even though emotional intelligence was not an antecedent of evaluations of organisational climate, the influence of the leader should not be forgotten. In order to clearly define possible impacts, leadership styles should be researched, because there might be possible correlations with evaluation of the team performance and chosen course of action towards poor performers. More immediate and effective solution for this problem is clear and accurate performance measuring tool. Having specific personal tasks with required outcome and constant control of the results, providing clear outcomes for the specific performance would help to avoid discontent within the team due to the performance of others. If the measures and outcomes, both, positive and negative, were contemplated thoroughly, not just complaints toward the team leader should decrease, but also overall motivation should increase.
It is very important to mention, that these decisions should be made in consistency with previous stress management strategy, in order to be beneficial and have synergy effects. Also, comprehensive on-boarding program should be implemented, in order to eliminate risks for new employees to experience the same problems.
Team work. Some mismatches were observed during the analysis of this part. As mentioned before, all the teams agree that there is too much work and too little time, however, they also think that people in the team spend too much time on unessential. It can be discussed from two perspectives. Either the team members may perceive this way, that they have too much work, while colleagues misuse their time, or due to too high workload, motivation is very low and therefore work time is dedicated to non-related activities. This could be related to another aspect of this category – work pressure from colleagues. These items signalise that team members do not work as one team, but conversely, creates an unpleasant environment for each other. For development of this sphere, further research is needed, in order to find out, how the LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 63 pressure is pursued and which reasons allow to conclude that colleagues are spending too much time on unessential. After clarification, the solution for this problem could be group-trainings as the place for the discussions about inner conflicts. Company X actually has regular team meetings, but the results show that the environment is not safe enough to share problems publicly, or no means are implied after that. The solution for that could be anonymous surveys about specific problems within the team and also individual supervisions. The situation should be observed and if after implementation of better productivity measures and re-designed job structure, the opinion about the colleagues do not change and the pressure is still present, further steps should be implied, as e.g. independent counselling services or group workshops, together with specialists, who could help to detect and solve these problems.
Commitment. The survey revealed that there is a low commitment of this staff and weak sense of job satisfaction in Company X. Strong satisfaction is an outcome of the strong work commitment, and being together generates many positive effects like low turnover, high attendance and better performance (Aamodt, 2007). A strong correlation between job satisfaction, commitment and retention was also proved by Kotze & Roodt (2005). Therefore, this analysis and practical solutions will concentrate on organisational commitment, as an antecedent of job satisfaction. For more accurate evaluation of organisational commitment, further research could be developed, employing organisational commitment employing guidelines, developed by G. Dressler (1999). However, some changes towards an increase in organisational commitment could be introduced immediately, considering the situation analysis and based on criteria of commitment-based human resource strategy (Scholl, 2008). The aspects, which were not noticed in Company X, will be discussed. Firstly, the personal growth strategies with every employee should be developed, increasing the motivation and clarity of the career LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 64 path. It is important to mention that these goals should be not just enforced by the manager, but discussed together with the employee. Second of all, since the company is still constantly growing, some practices, which could encourage organisational commitment, should be implied from the very beginning. The selection process should be developed to person-organisation fit model, meaning that candidates should not just meet the position’s requirements, but also match the organisational culture and have skills, which are needed for career development within the company. It would not just increase organisational commitment, but should also reduce fluctuation. Also, previously suggested research of leadership style would be beneficial for the improvement of organisational commitment as well. Research suggests that there is a positive significant correlation between transformational leadership and organisational commitment
(Omari et al., 2012). Third implication towards organisational commitment is related to the decision making process and communication. Many research, summarised by Scholl (2008), suggest that in order to have a high organisational commitment with the company, decision making should involve all employees, making them empowered. Communication should be open, meaning that employees are involved in overall problems and considerations of the company, being informed not just about the results and decisions, but also the process of the changes and strategic considerations.
The summary of these practical solutions are summarised in Table 23 below.
Table 23 Possible practical solutions for improving parts of OC in Company X Categories Possible practical solutions Workload -re-designing the requirements and specifications of positions -observation of outcomes after applied changes -productivity measure Team management -research of leadership style -performance measurement tool, including specific goals, evaluation and outcomes -on-boarding program LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 65
Team work -further research on methods and reasons of pressure -team building activities -individual counselling -unified goals setting for a team Commitment -development of individual growth in the company strategies -establishment of ‘person-organisation fit’ selection model -research of leadership style -employees’ empowerment and open communication strategy Source: Compiled by the author
In order to clearly see, what change the implementation of these strategic solutions would bring and what should be considered as successful results after the fulfilment of the strategy, goals should be composed. The ultimate goal is to improve organisational climate of Company
X, but it can be divided into particular objectives, which are parts of Organisational Climate, based on the categories developed above. Goals are prepared by applying SMART criteria for goal setting. The letters of abbreviation stand for different criterion – S – specific, M – measurable, A – achievable, R – relevant, T – time bound (Yemm & Graham, 2013).
The first goal, which should be achieved, concerning workload, is increased productivity by 20% within a year after the change of position requirements. S – increase of productivity of the positions, which were re-designed; M – productivity can be measured by the applied productivity measurement tool, predicted increase – 20%; A – 20% is an average of improvement of other companies after similar implementations (Guthrie J.P, 2001; Chui et al.,
2012; Smith G.P., 2014); R – productivity directly influences generating revenues for Company
X; T – goal should be achieved within a year after re-design of positions’ requirements and specifications.
Secondly, the turnover of new employees, who will have comprehensive on-boarding program, should decrease by 30%, within the period of 2 years. S – employees after on boarding program should tend to work longer than without; M –30% less turnover, measuring the LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 66 employee-driven leave of work; A – companies with on-boarding program have about 30% lower turnover rates in comparison with those without the program (Martin, 2009); R – high turnover causes high cost, workload for HR management (Hillmer et al., 2004); T – accurate decrease should be clearly concluded in two years, after the implementation of on-boarding program.
As third, teamwork is considered, designing a goal that team work should ameliorate in 6 months by applying team goals setting approach and particular team building activities. S – specific teams are analysed, using particular tools for the development; M – team work is measured by a concrete measurement tool, e.g. Team Climate Inventory (Anderson & West,
1998); A – common goal setting together with adequate trainings tend to improve team work and team performance (Castka et al., 2003); R – having weak teamwork creates work pressure and stress, which negatively influence the performance of employees; T – some improvements should already be seen in 6 months from the beginning to apply goal setting tools and trainings.
The last goal is related to the commitment to Company X. Implementation of personal- organisation fit recruitment strategy and empowerment of current employees will increase the organisational commitment within a year. S – separate tools are developed for new and current employees; M – it can be measured by theory-based questionnaires, participation rate in the events and initiatives of organisation, retention rate (Naqvi & Bashir, 2015); A – person- organisation fit recruitment model could be easily adapted; goal setting and decision making of every team could involve more team work, which would empower employees; R – low commitment, job satisfaction has negative impact on the retention, effectiveness of work
(Janssen & Yperen, 2004); T – one year after the implementation. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 67
All the practical solutions, which were suggested after the analysis of empirical data, retrieved from Company X, and developed goals, based on them, should be converted into clear, accurate means, budget and time framed tool. This was made by creating a course of actions plan, which can be adapted by HR Managers of Company X (See Table 24). Clarifications and reasoning of selected means can be found in Appendix 7.
Table 24 Course of organisational climate improvement actions for teams’ members Action Importance Means Outcome Budget Time frame Re-design of High Interviews Applied No 2 months positions with needs of material employees employees costs, just and labour therefore higher costs productivity Creation of High Quantitative/ Clear No 1 month productivity qualitative evaluation material (implementation) measurement (depending of costs, just ; permanent use tool on position) productivity labour and 360- and use of Degree work time costs Feedback methods Implementatio High Onboarding Decreased 30-50% 3 months n of relational Toolkit for turnover of salary of on-boarding HR new new program Professional employees employee s (University of (Aberdeen Minnesota) Study Group)
Team building High External Better team ~ €100 per 8 hours in moth activities plan trainings or work and employee per team; internal collaboratio (externally constantly activities by n ) HR Management Team goal Medium/hig Team Better team No 2 hours every unification h leaders’ work and material month per team costs, just LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 68
meetings collaboratio labour with team n costs
Personal Medium/hig Individual Higher self- No 2 hours every growth plan h meetings realisation, material third month per for every with expected costs, just employee employee employees increased labour work satisfaction costs and retention Implementatio High Person- Reduced No 20 hours for the n of ‘person- organisation turnover, material development, organisation fit increased costs, just permanent use fit’ selection framework commitment labour model (Kristof, 1996) costs Source: Compiled by the author
This plan should help to improve these highlighted problematic areas, also increasing the level of OC in Company X. First of all, Company X should concentrate on actions, labelled as highly important, because these solutions are formed, based on the items of OC, which are valued the least. The implementation of the plan or just some parts of then would improve the general wellbeing of current and future employees. For new employees, two actions were formed separately – on-boarding system and recruitment model. It should help to avoid same problems with newcomers, already from the first days having improved organisational climate.
To sum it up, these solutions, provided in the third part of the thesis, were made based on the research, described previously, therefore these implementations are intended to solve problems of these teams, which were in the sample. More accurate fit should be for Company X in Lithuania, because the majority of the sample were Lithuanian. However, due to data reliability and sufficient sample size, these solutions should have positive influence on the whole organisation. First of all, the company should focus on improving organisational climate of the teams, after that appointing some investments into the development of the leaders. LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 69
Limitations
Even though the process of the research was successful, the analysis of the data helped to provide accurate suggestions for practical implementations, some methodological limitations of the study should be considered:
1. The sample size is sufficient for reliable data analysis, however, the proportion of the
teams from the U.S. is small, therefore the application of the results could fit more
Company X in Lithuania rather than the whole corporation.
2. The questionnaire for the EI of the team leaders is self-reported, therefore, the results
could have been intendedly enhanced and not show exact level of EI.
3. Most of the team members, who have been participating in the research, are working
in Company X very short period of time, therefore, the opinion about organisational
climate of the company could be incomplete yet.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 70
Conclusions
1. The situational analysis of Company X, by analysing internal and external factors,
influencing the company, revealed that the company has some challenges while
managing Human Resources. Changing socio-cultural factors for employees’ motivation
and the expansion of the corporation due to favourable political and economic trends
creates some difficulties in managing the retention of current staff and recruitment of new
employees. The analysis also highlighted the specific organisational structure of
Company X, by being divided into small teams, which suggested the need of further
analysis of the performance of these teams and their leaders. The fast growth of the
company and therefore the increasing complexity of the management of employees
revealed that team leaders are very important part of the corporation, having strong
influence on overall activities.
2. After the thorough analysis of the literature, a theoretical model for the empirical research
was developed, employing two concepts – emotional intelligence and organisational
climate. Both elements were divided into several dimensions. The quantitative research
involved 155 employees of the Company X, evaluating emotional intelligence of team
leaders’ and perception of their team’s subordinates about organisational climate in the
team. The research concluded that team leaders in Company X have average emotional
intelligence, having no statistically significant difference between the teams and therefore
having no relationship to organisational climate of the teams. However, the statistically
significant difference in organisational climate between teams has been found. The data
of the research has provided the possible reasons for these differences, also determining LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 71
the most important items of organisational climate, which should be further developed, in
order to improve organisational climate in Company X.
3. As the empirical research showed, Human Resource Department of Company X should
pay most attention to the different items of organisational climate as a predictor of job
satisfaction, motivation, productivity and retention. The analysis of data, retrieved from
the empirical research in Company X, helped to define four main categories, which
should be developed: workload, team management, teamwork and commitment. The
practical solutions for every category were made, based not just the results of the
research, but also reasoned by the analysis of the theory. The plans of concretes actions,
in order to improve EI and OC were developed, suggesting different actions, e.g. EI
development trainings, on boarding program, ‘person-fit’ recruitment strategy,
productivity measurement tool, redesign of the positions. The means, outcomes, material
and time costs were also provided.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 72
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Appendices
Appendix 1. Organisational structure of Company X in Lithuania
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 80
Appendix 2. Emotional Intelligence questionnaire
Questionnaire for team leaders Instructions: Indicate the extent to which each item applies to you using the following scale: 1 = strongly disagree; 2 = disagree; 3 = neither disagree nor agree; 4 = agree; 5 = strongly agree. Nr. Statement Agreement 1 2 3 4 5 1. I know when to speak about my personal problems to others 2. When I am faced with obstacles, I remember times I faced similar obstacles and overcame them 3. I expect that I will do well on most things I try 4. Other people find it easy to confide in me 5. I find it hard to understand the non-verbal messages of other people 6. Some of the major events of my life have led me to re-evaluate what is important and not important 7. When my mood changes, I see new possibilities 8. Emotions are one of the things that make my life worth living 9. I am aware of my emotions as I experience them 10. I expect good things to happen 11. I like to share my emotions with others 12. When I experience a positive emotion, I know how to make it last 13. I arrange events others enjoy 14. I seek out activities that make me happy 15. I am aware of the non-verbal messages I send to others 16. I present myself in a way that makes a good impression on others 17. When I am in a positive mood, solving problems is easy for me 18. By looking at their facial expressions, I recognize the emotions people are experiencing 19. I know why my emotions change 20. When I am in a positive mood, I am able to come up with new ideas 21. I have control over my emotions 22. I easily recognize my emotions as I experience them 23. I motivate myself by imagining a good outcome to tasks I take on 24. I compliment others when they have done something well 25. I am aware of the non-verbal messages other people send 26. When another person tells me about an important event in his or her life, I almost feel as though I have experienced this event myself 27. When I feel a change in emotions, I tend to come up with new ideas 28. When I am faced with a challenge, I give up because I believe I will fail 29. I know what other people are feeling just by looking at them 30. I help other people feel better when they are down 31. I use good moods to help myself keep trying in the face of obstacles 32. I can tell how people are feeling by listening to the tone of their voice 33. It is difficult for me to understand why people feel the way they do
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 81
Appendix 3. Organisational climate questionnaire
Questionnaire for teams’ members
Nr. Statement Agreement 1 2 3 4 5 1. I have clear goals and objectives for my job. 2. I think my team leader is too tolerant for poor performers. 3. I feel a strong sense of job satisfaction. 4. It is difficult to ask the team leader for help. 5. There is a high turnover of staff in this team. 6. People in the team do not spend too much time on unessential. 7. My team receives all the information it needs to carry out its function well. 8. I understand clearly how contribute to the general goals of the company. 9. I have adequate opportunities to express my views in my team. 10. Conflicts are constructively/positively resolved in the team. 11. The work of the team is well-coordinated. 12. I am allowed to participate sufficiently in significant decisions that affect my work. 13. I am made responsible only for those things I can influence. 14. My team leader likes me to consult him/her before I take action. 15. I’m kept well enough informed for me to make decisions well. 16. I am rarely put under undue work pressure by my colleagues. 17. I do not feel that the pressure of work is excessive. 18. There is rarely too much work and too little time. 19. Work methods here are quickly changed to meet new conditions. 20. If you make an error in this team, it is often held against you. 21. Motivation is kept at high levels in the team. 22. The commitment of the staff is high in this team. 23. The team leader always solves the vast majority of important problems. 24. I am proud to be part of this team. 25. I feel that I am valued member of the team. Instructions: Indicate the extent to which each item applies to you using the following scale: 1 = strongly disagree 2 = disagree 3 = neither disagree nor agree 4 = agree 5 = strongly agree
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 82
Appendix 4. Descriptive statistics
Gender
Cumulative Frequency Percent Valid Percent Percent Valid Female 123 79,4 79,4 79,4 Male 32 20,6 20,6 100,0 Total 155 100,0 100,0
Age
Cumulative Frequency Percent Valid Percent Percent Valid 18 to 24 76 49,0 49,0 49,0 25 to 34 61 39,4 39,4 88,4 35 to 44 8 5,2 5,2 93,5 45 to 54 5 3,2 3,2 96,8 55 to 64 4 2,6 2,6 99,4 65 to 74 1 ,6 ,6 100,0 Total 155 100,0 100,0
Worklenght
Cumulative Frequency Percent Valid Percent Percent Valid less than 6 months 56 36,1 36,1 36,1 6-12 months 39 25,2 25,2 61,3 1-2 years 45 29,0 29,0 90,3 more than 2 15 9,7 9,7 100,0 Total 155 100,0 100,0
Country
Cumulative Frequency Percent Valid Percent Percent Valid The U.S. 31 20,0 20,0 20,0 Lithuania 124 80,0 80,0 100,0 Total 155 100,0 100,0
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 83
Appendix 5. Pearson Correlations
**
** **
**
1
12
12
12
12
12
12
12
12
12
12
12
,248
,362
,001
,811
,004
,759
,003
,785
,000
,912
,598
,653
,440
,246
,977
,912
-,170
-,145
-,009
-,036
Commitment
**
*
*
1
12
12
12
12
12
12
12
12
12
12
12
,248
,362
,009
,712
,036
,608
,933
,027
,018
,665
,715
,941
,454
,239
,666
,139
,849
,062
-,118
-,024
Teamwork
**
**
**
**
1
12
12
12
12
12
12
12
12
12
12
12
,001
,811
,009
,712
,002
,807
,105
,491
,000
,935
,702
,866
,469
,232
,461
,236
,780
,090
-,123
-,055
Responsibility
**
*
**
*
**
1
12
12
12
12
12
12
12
12
12
12
12
,004
,759
,036
,608
,002
,807
,042
,594
,000
,908
,068
,179
,861
,057
,411
,233
-,543
-,416
-,262
-,373
cation
Communi
**
*
*
1
12
12
12
12
12
12
12
12
12
12
12
,003
,785
,933
,027
,105
,491
,042
,594
,013
,689
,334
,342
,890
,350
,347
-,306
-,301
-,045
-,296
-,298
Clarity
**
*
**
**
*
1
12
12
12
12
12
13
12
12
12
12
12
,000
,912
,018
,665
,000
,935
,000
,908
,013
,689
,372
,517
,533
,200
,944
,740
-,284
-,208
-,023
-,107
OC
*
*
**
1
12
12
12
12
12
12
12
12
12
12
12
,598
,715
,702
,068
,334
,372
,018
,666
,261
,353
,025
,639
,001
,840
-,170
-,118
-,123
-,543
-,306
-,284
Appraisal
*
**
**
1
12
12
12
12
12
12
12
12
12
12
12
Correlations
,653
,941
,866
,179
,342
,517
,018
,666
,115
,480
,001
,828
,000
,869
-,145
-,024
-,055
-,416
-,301
-,208
Utilisation
*
1
12
12
12
12
12
12
12
12
12
12
12
,440
,246
,454
,239
,469
,232
,861
,057
,890
,533
,200
,261
,353
,115
,480
,051
,574
,014
,683
-,045
Regulation
*
**
**
1
12
12
12
12
12
12
12
12
12
12
12
,977
,666
,139
,461
,236
,411
,350
,944
,025
,639
,001
,828
,051
,574
,000
,920
-,009
-,262
-,296
-,023
nding
Understa
**
**
*
**
1
12
12
12
12
12
12
12
12
12
12
12
,912
,849
,062
,780
,090
,233
,347
,740
,001
,840
,000
,869
,014
,683
,000
,920
-,036
-,373
-,298
-,107
EI
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
N
Sig. (2-tailed) Sig.
Pearson Correlation Pearson
Correlation is significant at the 0.01 level (2-tailed). level the 0.01 at significant is Correlation
Correlation is significant at the 0.05 level (2-tailed). level the 0.05 at significant is Correlation
*. *.
**. **.
Commitment
Teamwork
Responsibility
Communication
Clarity
OC
Appraisal
Utilisation
Regulation
Understanding EI LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 84
Correlations
LEADER EI Age Gender Work length Country LEADER EI Pearson Correlation 1 -,073 -,105 ,044 ,250(**) Sig. (2-tailed) ,423 ,249 ,631 ,005 N 122 122 122 122 122 Age Pearson Correlation -,073 1 -,129 ,444(**) -,593(**) Sig. (2-tailed) ,423 ,139 ,000 ,000 N 122 133 133 133 133 Gender Pearson Correlation -,105 -,129 1 -,331(**) ,122 Sig. (2-tailed) ,249 ,139 ,000 ,164 N 122 133 133 133 133 Work length Pearson Correlation ,044 ,444(**) -,331(**) 1 -,170 Sig. (2-tailed) ,631 ,000 ,000 ,051 N 122 133 133 133 133 Country Pearson Correlation ,250(**) -,593(**) ,122 -,170 1 Sig. (2-tailed) ,005 ,000 ,164 ,051 N 122 133 133 133 133 ** Correlation is significant at the 0.01 level (2-tailed).
Correlations
AVG OC Age Work length Country Gender AVG OC Pearson Correlation 1 -,013 -,027 ,048 -,002 Sig. (2-tailed) ,881 ,753 ,587 ,983 N 133 133 133 133 133 Age Pearson Correlation -,013 1 ,444(**) -,593(**) -,129 Sig. (2-tailed) ,881 ,000 ,000 ,139 N 133 133 133 133 133 Work length Pearson Correlation -,027 ,444(**) 1 -,170 -,331(**) Sig. (2-tailed) ,753 ,000 ,051 ,000 N 133 133 133 133 133 Country Pearson Correlation ,048 -,593(**) -,170 1 ,122 Sig. (2-tailed) ,587 ,000 ,051 ,164 N 133 133 133 133 133 Gender Pearson Correlation -,002 -,129 -,331(**) ,122 1 Sig. (2-tailed) ,983 ,139 ,000 ,164 N 133 133 133 133 133 ** Correlation is significant at the 0.01 level (2-tailed).
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 85
Appendix 6. Means for improving EI of the team leaders in Company X
Action: Comprehensive measurement of EI. Tool: ECI - 360 Emotional Competence Inventory
Price: $295
Source: http://www.clarionenterprises.com/assessments-eq.php
Sample of the test
Action: Training program for leaders. Tool: Emotional Intelligence Training (Social Games, Lithuania). Price: €580 per person
Source: http://www.emocinisintelektas.lt/mokymai/emocinis-intelektas/kainos
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 86
Action: Possible trainings for improving particular EI dimensions: empathy.
Tool: “Manual: Empathy Training The Center for Building a Culture of Empathy and Compassion”. Duration – 15 hours. Price: free
Source: http://cultureofempathy.com/References/Experts/Others/Files/Marieke-Kingma- Empathy-Training-Manual.pdf
Plan of activities (example):
Action: Research of the leadership style. Tool: Multifactor Leadership Questionnaire. Price: 30$ per unit
Source: http://www.mindgarden.com/multifactor-leadership-questionnaire/229-mlq-actual- ought-individual-report.html#horizontalTab1
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 87
Appendix 7. Means for improving OC of the teams in Company X
Action: Creation of productivity measurement tool. Tool: 360-Degree Feedback
Source: http://www.ccl.org/leadership/pdf/research/Using360Feedback.pdf
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 88
Action: On-boarding program. Tool: Onboarding Toolkit for HR Professionals.
Source: https://www1.umn.edu/ohr/prod/groups/ohr/@pub/@ohr/@toolkit/documents/asset/ohr_asset_17 5051.pdf
Example of the tools provided in the toolkit.
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 89
Action: Team building activities plan. Tool: internal or external trainings Price: depending on the tool, average €100 per training per employee (based on previous costs of the company).
Source: (for internal trainings) http://hrweb.berkeley.edu/files/attachments/Team-Building- Toolkit-KEYS.pdf
Example of internal trainings plan
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 90
Action: Team goal unification. Tool: Goal setting plans during the meetings
Source: http://www.oracle.com/us/media1/goal-setting-fresh-perspective-ee-1679275.pdf
Example of team’s goal setting plan
Example of goals’ evaluation
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 91
Action: Personal growth for every employee. Tool: Individual Development Plan
Source:https://www1.umn.edu/ohr/prod/groups/ohr/@pub/@ohr/@trainingservices/documents/a sset/ohr_asset_096166.pdf
Example of personal opportunities development plan
LEADER EI AND ORGANISATIONAL CLIMATE IN COMPANY X 92
Action: Implementation of ‘person-organisation fit’ selection model. Tool: Person-organisation fit framework (Kristoff, 1996).
Source:http://blog.zukunft-personal.de/wp-content/uploads/2015/08/Person-Organization-Fit.png
Person-organisation fit framework