Article

Drivers of Employee Engagement: Global Business Review

17(4) 965–979
The Role of Leadership Style © 2016 IMI
SAGE Publications
sagepub.in/home.nav
DOI: 10.1177/0972150916645701
http://gbr.sagepub.com

Sapna Popli1
Irfan A. Rizvi2

Abstract
The primary objective of this research article is to study the drivers of employee engagement especially
the influence of leadership style. The article has used a multi-cross-sectional descriptive design. The
empirical study is based on the data collected from 340 front-line employees from five organizations
across the service sector in the Delhi—National Capital Region (NCR). The results from this study
reveal significant relationships between leadership styles and employee engagement. A moderating
influence of age and education was also found in the relationship between leadership styles and
employee engagement. The study highlights the importance and the significant role of employee engage-
ment and the role leadership styles play in developing a culture of engagement. Appropriate leadership
styles and human resource (HR) practices that drive engagement need to be fostered in organizations
to drive performance. The instruments used for the study are Multi-factor Leadership Questionnaire
(MLQ-5X Short Rater Form) for leadership style and E3 (Development Dimensions International [DDI])
to capture employee engagement.

Keywords
Employee engagement, transformational leadership, transactional leadership, leadership style, passive-
avoidant leadership, India

Introduction
Employee engagement has found its way up from the relatively lower quarters of being housed in one
forgotten corner of the human resources (HR) or training and development departments to its own villa
in the C-suite. This change indicates the realization by top executives that they need to be respon-
sible and accountable for employee engagement, rather than leaving it for HR to action. Jack Welch, the
former CEO of General Electric, while citing the best measures for a company’s health placed employee
engagement as the top measure, with customer satisfaction and free cash flow being second and third,
respectively (Welch & Welch, 2006). In the current environment of increasing global competition and

1  
Professor, Marketing (Adjunct), IMT, Ghaziabad and Fellow, International Management Institute (IMI), New Delhi, India.
2  
Professor of Leadership & Change Management, International Management Institute, New Delhi, India.

Corresponding author:
Sapna Popli, International Management Institute, B-10, Qutub Institutional Area, New Delhi-110016, India.
E-mail: sapnapopli@gmail.com
966 Global Business Review 17(4)

slower growth prospects, raising employee engagement is seen as a key strategy for organizational
success. According to the Society for Human Resource Management (SHRM)/Globoforce (2013) survey,
nearly half of HR professionals indicated employee engagement amongst the top three challenges their
organization faces, followed by succession planning, culture management, employee retention and turn-
over and performance management.
The article focuses on employee engagement and its drivers, specifically leadership style. The article
is structured as follows. The first section contains the literature review, identification of gaps and
development of objectives and hypotheses. The methodology is discussed in the second section and
also includes sample, instruments and data collection design. The third section contains the analysis,
conclusions and implications of the study.

Review of Literature and Development of Objectives

Outcomes of Employee Engagement
Research by academics and consulting organizations has provided substantive evidence on the positive
outcomes of engagement. For example, a large-scale Gallup (2013) research which examined 49,928
business or work units and covering about 1.4 million employees in 192 organizations, across 49 indus-
tries, in 34 countries, concluded that employee engagement strongly relates to key organizational out-
comes in any economic climate, and that employee engagement is an important competitive differentiator
for organizations. More specifically, the research found that

1. Business or work units that score in the top half of their organization in employee engagement
have nearly double the odds of success (based on a composite of financial, customer, retention,
safety, quality, shrinkage and absenteeism metrics) when compared with those in the bottom half.
Those at the 99th percentile have four times the success rate compared with those at the first
percentile.
2. Compared with bottom-quartile units, top-quartile units on engagement have
• 37 per cent lower absenteeism,
• 25 per cent lower turnover (in high-turnover organizations),
• 65 per cent lower turnover (in low-turnover organizations),
• 28 per cent less shrinkage,
• 48 per cent fewer safety incidents,
• 41 per cent fewer patient safety incidents,
• 41 per cent fewer quality incidents (defects),
• 10 per cent higher customer metrics,
• 21 per cent higher productivity and
• 22 per cent higher profitability.

Another analysis of engagement database of thousands of employees across 200 organizations by

Wellins, Brenthal and Phelps (2006) for Development Dimensions International (DDI) showed that
employees with higher engagement scores are more satisfied with their jobs, less likely to leave their
companies and more capable of achieving their performance goals. Quality errors (as measured by
external and internal parts per million) stood at 5,658 for the low-engagement group and only 52 for the
high-engagement group. In a services organization, highly engaged employees achieved an average of
99 per cent of their sales goals, while disengaged sales reps averaged 91 per cent.
Popli and Rizvi 967

While academic response to the popularity of employee engagement was initially slow, in the last
10 years academic research has also started validating and accepting the positive outcomes of employee
engagement. According to Witemeyer (2013), engaged employees display a number of behaviours of
potential benefit to their organizations including going the extra mile, speaking highly of the company,
collaboration, proactive problem-solving, staying late, putting in extra hours, assisting colleagues,
sharing knowledge, offering creativity and participating in organizational dialogue. Other researchers
have provided evidence of positive association of engagement with productivity, performance, profita-
bility, enhanced safety and customer loyalty and satisfaction (Coffman, 2000; Ellis & Sorensen, 2007;
Gallup, 2008; Heintzman & Marson, 2005; Hewitt Associates LLC, 2004; Markos & Sridevi, 2010;
Towers Perrin, 2003).
Various other documented benefits of employee engagement include reduced employee turnover,
improved individual performance, increased advocacy of the organization, positive impacts on health and
well-being, increased self-efficacy and receptivity to change initiatives (Bhattacharya, 2014; Blessing
White 2008; Luthans & Peterson, 2002; Shaw, 2005; Truss et al., 2006). Empirical evidence suggests that
the presence of high levels of employee engagement enhances job performance, task performance, organ-
izational citizenship behaviours, productivity, discretionary effort, affective commitment, continuance
commitment, levels of psychological climate and customer service (Christian, Garza & Slaughter, 2011;
Rich, LePine & Crawford, 2010). Employee engagement has also been associated with higher levels of
profit, overall revenue generation and growth (Xanthopoulou, Bakker, Demerouti & Schaufeli, 2009).
There is thus enough research to claim that employee engagement has a strong positive relationship
with business success, at both the individual and the firm levels, and it yields multiple positive outcomes
including retention, productivity, profitability and customer loyalty and satisfaction.

Drivers of Employee Engagement

Having evidenced that engagement produces various positive individual-level outcomes and also
impacts critical organizational outcomes, the next logical question is to explore the drivers of employee
engagement. A review of literature provides several answers, noteworthy among them are discussed in
the following paragraphs.
Saks (2006) while identifying employee engagement as a multidimensional construct specified
perceived supervisor support, rewards and recognition, procedural justice, distributive justice and per-
ceived organizational support as the predictors of employee engagement. Bakker and Demerouti (2008)
in their model included job resources (e.g., autonomy and performance feedback) and personal resources
(e.g., self-efficacy and optimism) as antecedents of work engagement, which lead to performance.
Zhang (2010) extracted eight commonly cited positive predictors of employee engagement from the
literature that included expansive communication, trust and integrity, rich and involving job, effective
and supportive direct supervisors, career advancement opportunities, contribution to organizational
success, pride in the organization and supportive colleagues/team members. Wollard and Shuck (2011)
identified 42 antecedents of engagement through a structured literature review of which half were indi-
vidual antecedents (e.g., optimism and self-esteem) and the other half were organizational antecedents
(e.g., feedback and supportive organizational culture).
Other drivers of engagement cited in studies include management practices, immediate supervisor,
career development opportunities, recognition, teamwork and supportive environment, pay rewards
and benefits (Aon Hewitt, 2014; Branham & Hirschfield, 2010; Gallup, 2008; Gibbons, 2006; Hewitt
Associates, 2008; Robinson, et al. 2004; SHRM/Globoforce, 2013; Vance, 2006). Additional drivers of
968 Global Business Review 17(4)

employee engagement include employee input in decision-making, constructive feedback, receiving

formal appraisals and the implementation of performance development plans (Gallup, 2008; Robinson,
Perryman & Hayday, 2004). A close analysis of these drivers indicates that conceptually leadership
has a critical input in fostering employee engagement. Support for this argument comes from research
by Wang and Walumbwa (2007) and Macey and Schneider (2008) that suggests leadership as being one
of the single biggest factors affecting employee perceptions in the workplace and workforce engage-
ment. Attridge (2009) asserted that leadership style, applying to leader–follower interactions, is critical
for promoting employee engagement. Wellins et al. (2006) in their research for DDI suggested that
organizations drive engagement by proactively leveraging three sources of influence for change, that is,
employees, leaders and organizational systems and strategies. These three drivers need to work in concert
to create an engaging work environment where leadership plays a critical role. Many of the ‘work envi-
ronment factors’ in their model are directly affected by the quality of leadership. Additionally, the DDI
studies show that changes in leader behaviours can have a real and significant impact on employee
engagement. A study of pre- and post-training engagement scores showed that improvement in leader-
ship skills through training led to higher employee engagement scores. In the light of the above, organi-
zations in contemporary times are holding their leaders responsible for driving employee engagement.

Leadership Style and Employee Engagement

Aon Hewitt’s (2014) Trends in Global Employee Engagement Report suggests that leaders hold the key
to employee engagement:

Leaders play an important role in employee engagement and becoming a best employer company. They do this
in direct and indirect ways. First, leaders have an indirect ‘multiplier effect’ on all the top engagement drivers
and other best employer indices. Ultimately, leaders make the decisions on brands, performance goals, pay and
recognition, communication to employees, work process and innovation.

Most of the recent workforce and engagement reports from Gallup (2013), Aon Hewitt (2014) and
SHRM (2014) have highlighted the role of effective leadership in building employee engagement.
In academic research, the impact of leadership on employee engagement is well documented. Kahn
(1990) proposed that leadership has the greatest potential to influence follower feelings of psychological
safety by providing a supportive environment in which one feels safe to fully engage in a task. Luthans
and Peterson (2002, p. 376) in their study using a sample of 2,900 participants concluded that ‘the most
profitable work units of companies have people doing what they do best, with people they like, and with
a strong sense of psychological ownership’. Findings from their research extended the theory about
a manager’s role in creating a supportive psychological climate (Brown & Leigh, 1996) and paralleled
early theories of engagement (Kahn, 1990; Maslach, Schaufeli & Leiter, 2001; Schaufeli, Salanova,
Gonzalez-Romá & Bakker, 2002) by suggesting that employees must have a supportive environment,
job resources and support necessary to complete their work.
Hay (2002, p. 53) in the article ‘Strategies for Survival in the War for Talent’, based on results of
survey data from 330 companies in 50 countries on employee perceptions and intentions towards their
employers, quoted that many employees ‘leave their jobs because they are unhappy with their boss’.
A leader’s behaviour is said to influence not only the overall organizational and customer outcomes but
also employee attitudes, behaviours and various employee outcomes. Some researchers have suggested
that leadership is one of the single biggest factors affecting employee perceptions in the workplace and
workforce engagement (Attridge, 2009; Harter, Schmidt & Hayes, 2002; May, Gibson & Harter, 2004;
Macey & Schneider, 2008; Wang & Walumbwa, 2007; Xu & Thomas, 2011).
Popli and Rizvi 969

As highlighted in these paragraphs, in some way or the other the top leadership and supervisory lead-
ership are responsible for ensuring the drivers of engagement, such as management practices, career
development and advancement, recognition and appreciation of employee contributions, teamwork
and a supportive working environment, the nature of the work, pay, rewards and benefits, constructive
feedback, receiving formal appraisals and availability of necessary work resources. Judge and Piccolo
(2004) and Erkutlu (2008) provide evidence for association between positive leader behaviours and fol-
lower attitude and behaviours linked with engagement. May et al. (2004), Saks (2006) and Bakker,
Hakanen, Demerouti and Xanthopoulou (2007) show that when supervisors exhibit more relationship-
related behaviours towards employees, higher levels of engagement is observed in them. Research has
also indicated that the qualities of transformational leadership result in outcomes, such as lower intention
to turnover and higher productivity, that are similar to those resulting from employee engagement
(Macey & Schneider, 2008; Walumbwa & Hartnell, 2011). Authentic and supportive leadership is also
theorized to impact employee engagement of followers in the sense of increasing their involvement,
satisfaction and enthusiasm for work (Gardner, Avolio, Luthans, May & Walumbwa, 2005; Macey,
Schneider, Barbera & Young, 2009).
Over the last 5 years, various researchers have explored the transformational–transactional leadership
styles and their linkage with employee engagement. Zhang (2010) in his study found negative associa-
tions between classical leadership style and employee engagement, transactional leadership style and
employee engagement, and positive associations between visionary leadership style and engagement and
also between organic leadership style and employee engagement. Xu and Thomas (2011) investigated
the evidence for a link between leadership behaviours (supports team, performs effectively and displays
integrity) and employee engagement. Their analysis showed that ‘supports team’ behaviour of the leaders
was the strongest predictor of engagement and that the three leadership factors overlapped in their
relationships with engagement. Ghadi et al., (2013) in their study based on a sample of 530 full-time
employees explored the mediating influence of meaning at work on the relationship between transforma-
tional leadership and work engagement. The results revealed that the transformational leadership style
influences followers’ attributes of work engagement. Hayati, Charkhabi and Naami (2014) in their study
aimed to determine the effects of transformational leadership and its components on work engagement
among hospital nurses. Their findings indicated that transformational leadership had a significant and
positive impact on work engagement and its facets. In addition, their research illustrated that transforma-
tional leaders transfer their enthusiasm and high power to their subordinates by the way of modelling.
In an India-specific context, leadership–employee engagement association has not been researched
much, and there are not many studies that link engagement with antecedent or outcome variables of
interest. Some recent works by Popli and Rizvi (2015), Singh and Krishnan (2014), Balaji and Krishnan
(2014), Bhatnagar (2007, 2012) and Mohapatra and Sharma (2010) do reflect a growing interest in both
leadership and engagement. Bhatnagar (2007) in the study on managers in the information technology
(IT)/information technology-enabled service (ITES) sector found that one of the factors that increase
engagement is supportive management, which is a trait that transformational leaders have. Sharma
and Krishnan (2012) in a study on the impact of pay satisfaction and transformational leadership on
employee engagement with a sample of 93 employees from the IT sector showed that transformational
leadership is a significant determinant of employee engagement. Popli and Rizvi (2015) in their research
with 104 cross-industry managers concluded that there is a positive relationship between transforma-
tional leadership and employee engagement.
As evidenced in various articles, academic research and practice, engagement has emerged as critical
for organizations and leadership seems to be the driving force for engagement to happen. Recent studies
of employee engagement however show that maintaining high levels of engagement has become fairly
970 Global Business Review 17(4)

challenging and engagement levels continue to be low across industries and countries. There is also a
lack of quality empirical work in the leadership–engagement association, especially in India. Shuck and
Herd (2012, p. 159) stated that

very little research could be located that examined the relation, conceptual or empirical, specifically between
leadership and employee engagement throughout the broader human resource literature base, and no article
could be located in any of the academy-sponsored journals that included both the key phrases leadership and
employee engagement.

A recent literature review on the leadership–engagement relationship by Carasco-Saul, Kim and Kim
(2014) recommends that there is a need for empirical research to validate the frameworks of leadership–
employee engagement; to have more explorations that examine the leadership–engagement relationship
from the perspectives of many leadership styles or an integrated one as a whole; and to examine the
moderation effects of factors such as gender, spatial distance, follower characteristics, promotion and
culture on the leadership–engagement association.
The relational review of leadership–engagement highlights the fact that many of the studies focus on
largely the visionary and transformational leadership when discussing engagement. As suggested in the
conceptual framework given by Shuck and Herd (2012), transactional leadership may also contribute
to the development of employee engagement along with transformational leadership, but has not been
tested much. In the Indian context, there is a clear lack of such studies. Our study therefore aims at
exploring the leadership–engagement association in this context. The study tries to bridge some of the
research gaps by using the full-range leadership model (Avolio & Bass, 1991) that helps incorporate
all three leadership styles of transformational, transactional and passive-avoidant. In addition to address-
ing the gap in the transactional–employee engagement relationship, the research also hopes to study the
negative association of passive-avoidant leadership, and thereby looks at the ‘not to do’ behaviours that
influence employee engagement negatively. The impact of leadership style on behavioural outcomes like
employee engagement as measured in this research will add to the body of research in the leadership–
behavioural outcomes domain. The empirical evidence of leadership–employee engagement relationship
in the Indian context is rather limited; the research hopes to add to this body of research.
The specific research objective of this article is ‘To understand the association between leader-
ship and employee engagement’. The three hypotheses that the article expects to test are the specific
associations with each of the three leadership styles propositioned as (i) there is a positive association
between transformational leadership style and employee engagement; (ii) there is a positive associa-
tion between transactional leadership style and employee engagement; and (iii) there is a negative
association between employee perception of passive-avoidant style and employee engagement.

Methodology

Sample and Data Collection

This study was conducted using a cross-sectional descriptive design. Quantitative data were collected
using simple random basis from the list of front-line employees shared by five selected organizations
located in National Capital Region (NCR) of Delhi; 329 valid responses were obtained from a total of
415 self-reporting forms circulated to these employees. The demographic profile of the respondents is
detailed in Table 1.
Popli and Rizvi 971

Table 1. Demographic Profile of Respondents

Type of Classification Category Number of Respondents Percentage in Sample

Age Less than 25 years 118 35.9
25–30 years 125 38.0
More than 30  86 26.1
Education Up to graduate 212 64.4
Postgraduate 117 35.6
Gender Male 213 64.7
Female 116 35.3
Number of Respondents 329
Source: Authors’ calculations.

Research Instruments
Data on employee engagement were collected using the engagement survey designed by DDI, E3sm
Phelps (2009). It is a 20-item scale with each statement marked on a standard five-point Likert scale
of strongly agree to strongly disagree. The self-rating instrument is used extensively and has an estab-
lished validity and reliability. The Cronbach’s alpha for this scale was measured to be 0.898 for this
study. A higher aggregate score on this scale would indicate a higher level of engagement.
To capture the leadership style, a subordinate’s perception of his superior’s leadership style was
collected using the Multi-factor Leadership Questionnaire (MLQ-5X) Short Rater Form. The MLQ
(Bass, 1985; Bass & Avolio, 1995) is the most widely used instrument to assess transformational leader-
ship theory (Avolio & Bass, 1991; Hunt, 1999; Kirkbride, 2006; Yukl, 1999) and ‘is considered the
best validated measure of transformational and transactional leadership’ (Ozaralli, 2003, p. 338). The
measure consists of 45 items of which 36 statements measure the nine leadership behaviours of idealized
influence (attributed), idealized influence (behavioural), inspirational motivation, individualized consid-
eration, intellectual stimulation, contingent rewards, management by exception (active), management by
exception (passive) and laissez-faire. These nine behaviours are measured through specific items that
are grouped together, with the first five behaviours loading on to transformational leadership style, the
next two on transactional and the last two on passive-avoidant leadership style. The Cronbach’s alpha for
each of the three styles was measured at 0.902 for transformational items (TSL), 0.747 for transactional
(TCL) and 0.785 for passive-avoidant (PAL). The Cronbach’s alpha for the full scale was measured at
0.931. For the purpose of this study, the three-factor structure of the MLQ has been used instead of the
nine-factor structure that considers each of these subscales. The permission to use MLQ was obtained
from Mind Garden, Inc. and for the employee engagement scale from DDI.

Analysis and Conclusions

Results and Analysis

To understand the association between leadership and employee engagement, correlation and regression
analyses were used.
The correlation coefficients in Table 2 are interpreted on the basis of effect sizes as suggested by
Cohen (1988). According to him, as per the effect size evaluation criterion for correlation coefficients,
972 Global Business Review 17(4)

Table 2. Correlations for Leadership Styles and Engagement

Correlations
Transformational Transactional Passive-avoidant Employee
Score Score Score Engagement Score
Employee Pearson Correlation 0.422** 0.480** –0.166**   1
Engagement Sig. (2-tailed) 0.000 0.000 0.003
Score N 329 329 329 329
Source: Authors’ calculations.
Note: **Correlation is significant at 0.01 level (2-tailed).

coefficients less than 0.28 are considered small effects, medium effects range from 0.28 to 0.49 and large
effects are greater than 0.49. The correlation analysis reflects moderate positive relationship between
transformation leadership and employee engagement (r = 0.422, p < 0.001); moderate positive relation-
ship between transactional leadership and employee engagement (r = 0.480, p < 0.001); and low nega-
tive correlation between passive-avoidant Leadership and employee engagement (r = –0.166, p = 0.003).
The values reflected in the analysis provide evidence to be able to conclude that the associations of
leadership style and engagement are significant.
To further confirm and understand the amount of variance in engagement due to leadership styles,
multiple regression was applied on the data. Prior to testing the hypotheses, the underlying assumptions
and conditions of multicollinearity, linearity and normality were examined. According to Green (1991),
to avoid multicollinearity, correlation between predictor variables greater than 0.90 should be removed
or combined. On these lines, the inter-correlations between predictor variables were checked and no
correlation between predictor variables was found to be greater than 0.90. The variance inflation factor
(VIF) that assesses how much the variance of an estimated regression coefficient increases if the
predictors are correlated is one of the other ways to measure multicollinearity. A VIF between 5 and
10 indicates high correlation and if the VIF goes above 10, one can assume that the regression coeffici-
ents are poorly estimated due to multicollinearity. In the case of this sample, the VIFs are reflected in
Table 3; none of these are above five and therefore can be concluded that the multicollinearity among
the three leadership styles of transformational, transactional and passive-avoidant is negligible to

Table 3. Regression

Std Error Change Statistics

Adjusted of the R 2
F Sig. F
Model R R2 R2 Estimate Change Change df1 df2 Change
1 0.508a 0.258 0.251 8.56627 0.258 37.716 3 325 0.000

ANOVAa
Model Sum of Squares df Mean Square F Sig.
1 Regression  8302.815   3 2767.605 37.716 0.000b
Residual 23848.822 325   73.381
Total 32151.637 328
Note: aDependent variable: employee engagement; bpredictors: (constant), passive-avoidant score, transformational score and
transactional score.
Popli and Rizvi 973

Coefficientsa
Unstandardized Standardized Collinearity
Coefficients Coefficients Statistics
Std
Model B Error Beta T Sig. Tolerance VIF
1 (Constant) 53.546 2.991 17.905 0.000
Transformational score 3.021 1.323 0.156 2.282 0.023 0.487 2.055
Transactional score 6.285 1.204 0.358 5.222 0.000 0.486 2.056
Passive-avoidant score –1.521 0.588 –0.124 –2.585 0.010 0.992 1.008
Source: Authors’ calculations.
Note: aDependent variable: employee engagement.

impact the model. An examination of the bivariate scatter plots showed that they formed relatively linear
lines, and thus no serious violations of the assumption of linearity. All the variables were checked for
normality using histograms and values of skewness and kurtosis. No serious violations of normality were
observed.
As reflected in Table 3, the regression model is stable and fit at F = 37.76, p < 0.001 for further
data analysis. All three leadership styles are found significant in this model at p < 0.05 and hence the
three styles independently also reflect a statistically significant relationship with engagement. The model
predicts that up to 25.1 per cent (adjusted R2 is 0.251) of variance in employee engagement is due to
leadership styles. The beta values for transformational and transactional leadership are 3.021 and 6.285,
respectively, and that of passive-avoidant is –1.521 and all are significant at a 0.05 level. Thus, the results
of correlations and multiple regressions provide evidence to reject the null hypothesis and say that there
exists a positive relationship between transformational leadership and engagement, between transac-
tional leadership and engagement and a negative relationship between passive-avoidant leadership and
engagement.
While evaluating the influence of the demographics on overall engagement scores, absolute differences
in mean engagement scores were reflected in age, gender and education categories. The differences were
however found to be significant due to age and education but not due to gender (Table 4). These were
tested using the independent sample t test (for the two categories—gender and education) and one-way
analysis of variance (ANOVA) (for the three categories of age).

Table 4. Engagement Scores across Categories

Mean Engagement
Category N Score Std Deviation Std Error Mean
Gender Female 116 74.8900 10.85245 0.92719
Male 213 74.5016 12.14501 0.74606
Education Postgraduate 117 72.8871 12.26131 0.99781
Graduate or less 212 75.6849 11.25743 0.71056
Age Less than 25 118 78.4539  9.32323 0.84757
25–30 125 71.0906 12.04944 0.88114
More than 30  86 76.7659 11.82075 1.21922
Source: Authors’ calculations.
974 Global Business Review 17(4)

Table 5. Fisher’s Z Transformation to Compare Correlations across Age Groups

Age Group
Difference Difference Difference
Less Than 25–30 More Than between between between
Correlations 25 (1) Years (2) 30 (3) 1 and 2* 1 and 3* 2 and 3*
TSL–EE 0.527** 0.457** 0.311** NS Significant at NS
p < 0.05
TCL–EE 0.459** 0.561** 0.425** NS NS NS
PAL–EE NS NS –0.334** NS Significant at Significant at
p < 0.05 p < 0.05
N 118 125 86
Source: Authors’ calculations.
Note:  **values are significant at p < 0.05; *values were tested using the Fisher’s Z transformation calculator given by Preacher
(2002). Available from http://quantpsy.org

The impact of age and education on employee engagement was then further tested along with
leadership styles by dummy coding and adding them as independent variables to the regression model.
The two variables were not found to be significant in the linear regression model. The reasons for non-
significant impacts could also be non-linear associations besides other factors. Therefore, to provide
some more insight, moderating influences of age and education were tested by comparing correlations
across categories using ‘Fisher’s Z transformation of r’. Table 5 reflects the correlations across categories
and whether the differences are significant across these categories.
Table 5 shows that the associations between leadership styles and engagement are significant not
only across the full sample of 329 but also across age groups. Transformational leadership–engagement
relationship is different for age groups less than 25 when compared with those more than 30. While in
both age groups there is a positive association, this association is stronger in the less-than-25 age group.
In addition, the negative association of passive-avoidant leadership style is significant only in the
more-than-30-years age category.
The correlations across education levels are reflected in Table 6, which shows that the differences in
correlations across graduates and postgraduates are not significant at 0.05 levels. In the case of the
passive-avoidant style, the association with engagement is significant only in the postgraduate group.
On the basis of the age and education analysis of the data, it can be concluded that age and education
both have some ‘moderating influence’ on the leadership styles–employee engagement associations.
These influences may be useful to explore in further research.

Table 6. Fisher’s Z Transformation to Compare Correlations across Education Groups

Education Groups
Correlations Postgraduates (1) Graduates or less (2) Difference between 1 and 2*
TSL–EE 0.378** 0.476** NS
TCL–EE 0.519** 0.457** NS
PAL–EE –0.212 NS NS
N 117 212
Source: Authors’ calculations.
Note:  **values are significant at p < 0.05; *values were tested using the Fisher’s Z transformation calculator given by Preacher
(2002). Available from http://quantpsy.org
Popli and Rizvi 975

Conclusions
On the basis of the analysis, it can be concluded that transformational leadership style has a positive
association with employee engagement. This style enthuses, inspires and motivates employees to work
towards the organizational goals and the leaders are able to draw out the best in the subordinates by
expressing confidence in their abilities. Transactional leadership style also has a positive association
with employee engagement and using this style leaders motivate subordinates by rewarding and appre-
ciating their followers in lieu of task accomplishment. The study not only found support for previously
established transformational leadership–employee engagement association but more crucially it estab-
lishes the transactional leadership–employee engagement association, especially during early stages of
career and amongst young employees.
One of the salient contributions of the study is the importance of both transactional and transforma-
tional leadership styles in enabling engagement. This finding is supported in research by Bass (1985)
who had viewed both transactional and transformational leadership as positive and recommended an
optimal use of the styles for maximum effectiveness. Bass and Avolio (1997) were of the opinion that
although transformational leadership may be more effective in changing times, the transactional process
of clarifying certain expectancies for a reward is an essential component of the full range of effective
leadership. These ideas of the proponents of the transformational–transactional leadership style seemed
to have been out of focus with emphasis on the transformational leadership style research in recent times.
In the past few years, however, some studies have started evaluating and recommending a leadership
style that uses both transactional and transformational styles for specific outcomes (Deichmann & Stam,
2015; Shuck & Herd, 2012).
The study evidenced the negative association of passive-avoidant leadership style and engagement.
Passive-avoidant behaviours, such as ‘failing to interfere until problems became serious’ and ‘delaying
or avoiding decisions’, have a negative association with employee engagement. Leaders need to watch
for such behaviours and need to be trained to be able to change these behaviours and be able to contribute
constructively to employee engagement.
Employee age impacts the level of employee engagement to a certain extent. The engagement scores
were higher for the employees in the age groups less than 25 (most of these employees were in their first
jobs) as well as for those in the age group more than 30. The engagement level of employees in the
age group 25–30 years was significantly lower than the other two age groups. The difference in engage-
ment scores across age groups in this study was found to be significant and can be generalized; however,
the findings about moderating influence of age need further exploration. The employees with up to
graduate level of education were more engaged when compared to employees with postgraduate educa-
tion, implying that education level also impacts employee engagement. The possible reasons being, a
higher education not only raises the aspirations of the employees in terms of their own careers but also
raises their expectations from their existing employment. They expect a higher education to translate into
getting a better treatment, appreciation, recognition and reward. The negative influence of passive-
avoidant style was significant for those with higher education, meaning where employees have higher
education their expectations of the leader are higher, a passive leader will fail to engage them.

Implications
As evidenced in the research, employees can be engaged in the presence of both transformational and
transactional leadership styles. The leaders need to be able to identify the style that works best in a
976 Global Business Review 17(4)

particular situation and matches the expectations of the employees for them to be engaged for better
performance. Employee engagement is a ‘dynamic condition’ in the form of enthusiasm and interest
and what the fully engaged employees bring to their work each day would be directly tied to both a more
unified workplace culture and the extra efforts, better ideas and innovations that make organizations
thrive (SHRM, 2014).
Employee engagement is a crucial variable impacting many organizational outcomes. Besides leader-
ship styles, other drivers of employee engagement such as supportive organizational culture, feedback,
trust, career advancement opportunities, effective and transparent HR practices highlighted in literature
can be focused on through the right training of supervisors and leaders. Since the study considered
the immediate supervisors as leaders, it may be worthwhile for organizations to focus on them through
management development programmes and training for all those employees who are supervising col-
leagues at customer interface level and not just leadership development programmes that are restricted
to employees at the senior and top management levels of the organization. Additionally, organizations
need to watch for behaviours that can be termed as ‘avoidant’ in managerial and leadership roles. While
trainings will focus on inculcating behaviours that are positive, some amount of focus on ‘what not to do’
while leading teams would be useful in reducing the passive-avoidant behaviours.
Employee engagement is considered critical for productive workplaces; despite differences in its
conceptualization and measurement, researchers and consulting firms all agree that increased engagement
drives various performance outcomes and results at all levels. Aon Hewitt’s (2014) global engagement
report suggests that ‘companies will need employees to go above and beyond in different ways—not just
to engage by working harder, but to engage in ways that show resiliency, learning, adaptability and speed’.
In summary, what the study implies for organizations and managers is the strong need to focus on
‘employee engagement’ and leadership behaviours that need to be calibrated often to keep employees
engaged.

Creating a culture of engagement will need to be a priority for organizations and it will be important to take
a holistic view beyond the employee engagement outcome alone. Those companies that focus on building
engaging leaders will see an exponential impact on employee engagement. (Aon Hewitt, 2014)

Acknowledgement
The authors are grateful to the anonymous referees of the journal for their extremely useful suggestions to improve
the quality of the article. Usual disclaimers apply.

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