Suitable leadership styles increase workplace motivation in the Lao banking industry

Abstract

In today‟s fast changing environment, flexibility and adaptability are significantly important factors for organisations to survive and thrive. The study of effective leadership styles is one of the key management functions which enable an organisation to sustain its competitive advantage and develop both its employees and the organisational outcomes.In order to ensure good quality management for an organisation, it is imperative to have effective leadership styles to produce positive business outcomes such as high levels of productivity, effective and efficient use of resources, high levels of quality and a positive can do attitude.

Lao People‟s Democratic Republic (PDR) is in a period of dynamic change. The country is making a gradual transition to a market economy and opening up to external trade and foreign investment.Thus, the government requires organisations and businesses to improve their service and business performance, especially the service of the banking industry which is one of the major factors boosting the Lao economic growth. However, the performance and efficiency of commercial banks in Laos is still low compared to the international standard and there is huge customer dissatisfaction regarding the low service of banks' staff.

The aim of this study is to identify the practical leadership styles that the banking industry in Laos should apply to improve employee performance and to increase their motivation at work. This research also identifies the main factors that motivate employees in Lao banks to work. In terms of the methodology, this research employs mixed methods in order to better explore the research problem. Findings from the research reveal that there are some weaknesses associated with the current leadership practices in Lao banks. There are a number of employees who are dissatisfied with their immediate superior‟s leadership practices, and a very small number of employees felt satisfied with their work performance; this is a result of the low level of staff empowerment in the banks.

There are four main leadership styles that employees preferred their superiors to be practising in order to improve their work performance and motivation at work. The possible four effective leadership styles are authentic leadership, transformational leadership, charismatic leadership, and participative leadership. In the area of motivational factors, results from the survey reveal that money is not the only factor that motivates employees to work but there are other significant factors such as self-esteem needs, opportunity for growth and fairness in the workplace.