Participative Leadership Style and Performance of the Manufacturing Sector in Kenya: A Case Study of Paper Converters (K) Ltd

Abstract

The dynamic business environment necessitates a leadership approach that involves employees in the decision-making processes to enhance organizational performance. Paper Converters (K) Ltd. is struggling to achieve optimal organizational performance due to challenges such as high import duties, competition from cheaper imports, and increased operational costs, compounded by the slow decision-making and potential internal conflicts associated with participative leadership. The purpose of this study was to establish the effect of participative leadership style on organizational performance at Paper Converters (K) Ltd. The research aimed to address the following objectives: the effect of delegated decision-making, open communication, encouragement of growth, idea sharing on organizational performance, and the intervening role of organizational culture in these relationships. Anchored on the path-goal theory and supported by the social exchange theory within the broader context of Kenya's manufacturing sector. Employing a descriptive research design, the study collected primary data from a sample of 90 respondents obtained from a population of 300 employees of Paper Converters (K) Ltd in Kenya, representing senior and middle management, and employees. Data was gathered through structured questionnaires and coded for quantitative analysis. Include inferential analysis including correlation and multiple linear regression analysis which are used to determine the relationships between variables. SPSS version 29 aided in the data analysis and the results were tabulated. The study ensured instrument reliability using Cronbach's alpha and tested validity through the Kaiser-Meyer-Olkin measure and Bartlett's Test for sampling adequacy. By incorporating organizational culture as an intervening variable, this research aimed to provide an understanding of how participative leadership impacted organizational performance at Paper Converters (K) Ltd. The study found that the major factors associated with participative leadership style at Paper Converters (K) Ltd included delegated decision-making, open communication, encouragement of growth, and idea sharing, with participative leadership and open communication accounting for 57.2% of the variance in organizational performance. The study identified delegated decision-making, open communication, growth encouragement, and idea sharing as key leadership factors. Delegated decision-making and open communication positively impacted organizational performance. Organizational culture was influenced by leadership but did not significantly mediate the leadership-performance relationship. The study concluded that while the organization performed well in financial metrics and shareholder returns, there were significant opportunities to enhance market performance and customer satisfaction, which are essential for sustained competitiveness. It concluded that, the study concluded that fostering a culture of delegated decision-making and effective communication is vital for improving organizational performance, although organizational culture alone did not serve as a meaningful mediator in this context. The study recommended prioritizing inclusive practices that encourage employee engagement, investing in market research to align with customer needs, enhancing training programs for leaders to improve participative skills and communication strategies, and proactively cultivating a positive workplace culture that supports collaboration and innovation to drive long-term success