Enzyme, Pharmaceutical Aids, Miscellaneous Last Part of Chapter no 5th.pdf
Proposal for a thesis
1. The impact of Leadership styles on organizational performance
In Oil & Gas sector in Egypt
By
XXXXXXXXXX
Proposal for a DBA thesis
Submitted to the “Business Administration Department”
Faculty of Commerce
Ain Shams University
The Main Supervisor
XXXXXXXX
Date: Thursday, October 17, 2019
2. The Impact of leadershipstyleson organizational performance in Oil & Gas sector in Egypt
1. Introduction
1.1. Background
In the global economyof the 21st century,competitioniscomplex,challengingandfilledwith
competitiveopportunitiesandthreats.In orderforany organization tosurvive,trytoachieve itsgoals&
gainhighprofits,ithas to enhance itsperformance andbecame superiortoitscompetitors.
Globally,there isanargumentaboutthe organizationperformance,measuredfromfinancial aspects&
profitabilityindicators (ROI),whetherthe successful performance isgreatlyinfluencedby leadership
especiallyinafirm’sseniorpositions oritisrelatedtothe organizationenvironments.
The collective researchof the pasttwodecadessuggeststhatthe successful leadershipinspires
enthusiasmandcommitment,enhancingbothemployeesandorganizationperformance.Onone hand,
some theoristsandmanypractitionershave arguedthatleadership especiallyinafirm’sseniorpositions
has an importantimpactonfirm'sperformance andsurvival atall levels Basedonthe ideathatchief
executiveofficers(CEOs) wieldthe dominantpowerandenjoyanexposedpositioninthe board,they
have an impacton organizational outcomes dependingontheirdecisions. Onthe otherhand, many
researchersreferthe successfulorganizationperformance tothe environmentandthe circumstancesto
achieve predeterminedorganizational goals.
From thisconsideration,thisstudyisintendedto determine whetherornotthe leadershipstyles
(namely the laissez-faire,Transactional&Transformational leadershipstyles) have animpact onthe
organizational performance inoil &gassector inside Egyptandto whatextent,contribute toempirical
studiesonleadershipstyle andbusinessperformance.
1.2. Research importance and justification
It's veryobviousthatEgyptianeconomyissuffering.One of the mainincome toegyptianeconomyisthe
oil & gas industrybeside SuezCanal,tourism&foreigndirectinvestment. There are manyOil & Gas
companiesinEgypt.AlthoughOil &Gas industryis boominginEgyptas a resultof the new explorations
inthe Mediterraneansea&redsea,more than70% of these companiesare makinglosswhilethe
balance 30% are performing eithersuperiorormedium performance(Accordingtothe data collected
fromCAPMAS).The aimof thisresearchisto studythe companieswithsuperiorperformance,moderate
3. performance &weekperformance inoil &gassector inEgypt thento evaluate the impact of leadership
styles(Laissez-faire,Transactional &Transformationalleadershipstyles)ineachof the three various
performances.If one of these three styleshasasignificantimpactoncompanieswithoutstanding
performance,thenwe willworkintransferring the skills,traits&rolesof thisstyle to the otherleaders
withlow companiesperformance &enhance theirweakperformance andenhance the overall oil &gas
industryinEgypt&the Egyptianeconomyasa whole.
1.3. Problem statement
Widelycelebratedcasesof adirectleadership - performancelinkmaybe foundinnumerous anecdotal
accounts of improvementsof companyperformance inall industriesattributedtochangesinleadership
(Nicholls,1988; Simms,1997). However,empirical studiesintothe linksbetweenleadership&
performance have beenlacking(Quick,1992).A numberof researcherstheorize thattransformational
leadershipislinkedtoorganizational performance(Howell &Avolio,1993).Conceptually,it'sargued
that the visionary&inspirational skillsof transformational leadersmotivate followers todeliver
superiorperformance (Nicholls.1988; Quick,1992). In summary,muchof the above evidence presented
as supportingthe claimiseitherinconclusive orempirical suspect.The limitedorinconclusivecharacter
of research findinginthisareasuggeststhe need toinvestigatefurtherthe nature of relationship
betweenleadership&performance.Thisstudyisa stepinthisdirection.I'll carrythisstudyon one of
the most importantindustrywhich Egyptianeconomyiscountingon whichisthe oil & gas industryso
that if we foundsignificantimpactof one of the three studiedleadershipstyles(Laissez-Faire;
Transactional & transformational leadershipstyles) onthe organization withoutstandingperformance
thenwe can use thisresultintransferringthe traits& character of thisstyle tootherleaderswith
differentstyle inordertoenhance the performance of oil &gas industry&the overall Egyptian
economy.
1.4 Research purpose
Thisstudyinvestigatedthe maineffectsof leadershipstylesonorganizational performance inoil &gas
sectorin Egypt.It specificallysoughttodetermine the impactof laissez-faire;transactional&
transformational leadershipstylesonorganizational performanceinoil &gas sectorin Egypt.
4. 1.5 Research Questions
The researchquestionsforthisstudyare as follows:
"What's the impactof Laissez-Faireleadershipstyleonorganizationalperformance inOil &Gas sector In
Egypt?"
"What's the impactof transactional leadershipstyle onorganizational performance inOil & Gas sectorIn
Egypt?"
"What's the impactof transformational leadershipstyle onorganizational performance inOil &Gas
sectorIn Egypt?"
1.6 Research Hypothesis
H01: There is nosignificantimpactofLaissez-Faire leadershipstyle onthe performance of Oil &Gas
sectorinEgypt.
H11: There is significant impactof Laissez-Faire leadershipstyle onthe performance of Oil&Gassector
inside Egypt.
H02: There is nosignificantimpactof Transactional leadershipstyle onthe performanceof Oil &Gas
sectorinEgypt.
H12: There is significant impactof Transactional leadershipstyle onthe performance of Oil&Gassector
inside Egypt
H03: There is nosignificantimpactof Transformational leadershipstyle onthe performanceof Oil &Gas
sectorinEgypt.
H13: There is significant impactof Transformational leadershipstyle onthe performance of Oil&Gas
sectorinside Egypt
5. 1.7 Limitations of the study
The study utilizedvoluntarysurveycompletionandassuch a givenriskof the studyis the
participationlevel.
The issue of potential misunderstandingsbythe populationbeingsurveyed.Itispossible that
the typesof questionsaskedmightbe interpreteddifferentlybythe readerandcause an
insufficientanalysisof theirresponses.
The readermay be self biased&wouldhave chosenanswersaffectedbythisbias
The surveyinstrumentsthemselves,the shortnumberof questions,andthe time frame utilized
mightalsolimitparticipationandpotentiallyevenmake the studyvulnerable tostatistical error
(Bryman,2008).
Selectionof participantsmaycreate predispositiontowardscertainoutcomes(Creswell,2009)
associates participatinginthe studymaycommunicate betweenthemselveshavingapotential
impact on the answers and statistical analysis (Creswell, 2009).
The studyis not includingthe Jointventure/ForeignpetroleumcompaniesworkinginEgyptdue
to unavailability of the records of these companies at CAPMAS
2. Literature Review
2.1 Introduction
In thischaptera literature reviewof leadership stylesispresented.The chapterisfocusingon definition
of Laissez-faire,Transactional &Transformationalleadership styles,Differentleadershiptheories The
factors usedtomeasure themaccordingto thisstudy& the linkbetweenleadershipstyles&
organizationperformanceasstatedbysome researchersinadditiontoimportantinformationaboutOil
& Gas sectorinEgypt
2.2 Leadershipin general
2.2.1 Types of leaders
2.1.1.1. Laissez-Faire Leaders
Thistype of leadersusedtoescape fromresponsibilitiesandhave afear fromtakingdecisions.they've
lowcommunicationwiththeirsubordinatesandneverinterfere inanyproblemsolving
6. 2.1.1.2. Transactional Leaders
Thistype of leadersare mainlyfocusedonmonitoring dailytasks,usedtouse hispowerof positionto
rewardor punishhissubordinates.Characterizedbyusingthe conceptof carrot or stick
2.1.1.3. Transformational Leaders
Thistype of leadersare trulyinspirational,usedtoarouse otherstoseekextraordinaryperformance
accomplishments,theyare focusingonthe sharedvisionandusedto encourage innovation&team
work
2.2.2 Leadershipfactors usedin this study (From Multifactor LeadershipQuestionnaire)(Developedby
Bass &Avolio)
2.2.2.1 Laissez-Faire Factor
Escape from responsibilities & fear of taking decisions
2.2.2.2 Transactional leadership factors
Contingentreward:Leaderhastoinformhissubordinateswiththe rolesandresultsexpectedfrom
themand thento rewardor punish themaccordingtotheiraccomplishments
Managementbyexception(active):Leaderismonitoringhissubordinatesduringcarryingouttheirtasks
and interfere earlyif anythingisgoingwrong
Managementbyexception(Passive):Leaderdidn'tidentifytohis subordinateswhathe needsfrom
themhoweverhe interfere once the problembecome serious
2.2.2.3 Transformational leadership factors:
Charisma:The leaderbecome role model tohissubordinates,he isalwaysguidingthemfromthe front
side inadditionshe isalwaysshowinghighconcernregardingethics&usedtoput the needsof his
subordinatesoverhisneeds.
Inspirational Motivation:The leaderusedtoinspire hissubordinatesinordertoachieve extraordinary
results,He ismotivating&supportingtheminorderto be committedtothe organization'sgoals&
sharedvision.
7. Intellectual stimulation:The leaderisstimulatinghissubordinatestobe creative andto thinkoutof the
box
2.2.3 Leadership & organizational performance
Many researchers talkaboutthe relationshipbetweenleadership&organizational performanceand
prove the directlinkbetweenthem.ForexampleFiedler(1996) statedthat effectiveness&capabilities
of leadersconsideredthe mainreasonsforthe successof anyorganizationsand vice-versa.(Hennessey,
1998) statedthatthe onlywayto withstandthe ambiguityandcontinuouschange inthe environmentis
by trainingthe leadersandimprovingtheirskills&capabilities.(Nicholls,1998; Simms,1997)relatedthe
successof any organizationtothe effectivenessof theirleaders.Althoughall of these opinions,still the
empirical studiesintothe linkbetweenleadership&performance have beenlacking(Quick,1992) in
additionthe studyof the impactof leadershipstylesonorganizationperformance inoil &gascompanies
inEgypt isveryrare and neededtobe investigated.Thisstudyisasteptowardthisdirection.
2.3 Managing Organizational Performance
2.3.1 The Essence of Performance
Organizational performance isdefinedas“the ability toacquire resourcesnecessaryfororganizational
survival andit isdependentonmanyvariables,includingthe nature of the leader’sstrategicchoices,
and the nature of the strategyimplementation process.
there wasan inherenttraditionalpractice amongstfirmstointerchange the term“organizational
performance”with“financialperformance”.“financial performance”alsoreferstothe “profitability”of
an organization.
Marx et al.(1999) advise that“profitability” isdeterminedwhenafirmusesits productive assetsto
generate revenuethateventuallyexceedsitscosts.
organizational performance outcomes,which couldeitherbe statedquantitatively(namely:sales;
profitability;returnoninvestment[ROI],andotherfinancial indicators) ordescribed
qualitatively(namely:efficiency; laborproductivity;responsetimes;customersatisfaction;innovation;
employeesatisfaction;andorganizational culture).
2.3.2 Return on investment( ROI)
Simplyitisthe amountof centsgainfor each dollarinvested.ROI isdefinedas operating incomedivided
by averageoperating assets Atpresent,ROIhasbeenwidelyrecognizedandacceptedinbusinessand
financial managementinthe private andpublicsectors asa performance indicator
8. 2.4 Petroleum Sector in Egypt
Egypt isthe largestnon-OPECoil producerinAfricaandthe second-largestdrynatural gasproduceron
the continent.The countryalsoservesasa major transitroute for oil shippedfromthe Gulf to Europe
and the UnitedStates.
Egypt isthe largestoil producerinAfricaoutside of the Organizationof the PetroleumExporting
Countries(OPEC),andthe second-largestnatural gasproduceronthe continent,behind Algeria.Egypt
playsa vital role ininternational energymarketsthroughthe operationof the SuezCanal andSuez-
Mediterranean(SUMED) Pipeline.
The SuezCanal isan importanttransitroute foroil and liquefiednatural gas(LNG) shipmentstraveling
northboundfromthe PersianGulf toEurope and NorthAmericaandsouthboundshipmentsfromNorth
Africaand countriesalongthe MediterraneanSeatoAsia.The SUMED Pipelineisthe onlyalternative
route nearbyto transportcrude oil from the RedSea to the MediterraneanSeaif shipswere unableto
navigate throughthe SuezCanal.Feescollectedfromthe operationof these twotransitpointsare
significantsourcesof revenue forthe Egyptiangovernment.
In Africa,Egypthas the third-largestpopulation,afterNigeriaandEthiopia,andthe second-highestgross
national income (GNI),afterNigeria,accordingtothe WorldBank.Egypt’seconomysufferedduringand
afterthe 2011 revolutionasthe countryexperiencedasharpdecline intourismrevenueandforeign
directinvestment,accordingtothe International MonetaryFund(IMF).Annualgrossdomesticproduct
(GDP) growthin Egyptdroppedfrom5.1% in 2010 to 1.8% in 2011 andstill remainsbelow the pre-
revolutionlevel,averaging2.1%in2013. Accordingtothe IMF, financial support,particularlyinthe form
of oil andLNG shipments,fromsome PersianGulf countrieshashelpedEgypttomeetitsdomestic
energydemand.
Egypt’seconomyhasnot fullyrecoveredsince the 2011 revolution.The governmentcontinuestofund
energysubsidies,whichcostthe government$26 billionin2012, andthishas contributedtothe
country’shighbudgetdeficitandthe inabilityof the EgyptianGeneral PetroleumCorporation(EGPC),
the country’snational oil company,topayoff its debtto foreignoperators.EGPCowesforeignoiland
gas operatorsbillionsof dollars,whichhasledforeignoperatorstodelaytheirinvestments inexisting
and newoil andnatural gas projects.EGPC accumulated$6.3 billioninoutstandingarrearstoforeignoil
and gas companies,of which$1.5 billionwaspaidbackinDecember2013. The debthas since increased
back to $7.5 billionasof June 2014 andcontinuestogrow.
In 2000 The ministryof petroleumadoptedanintegratedstrategy,the mostimportantmechanismto
implementitistodevelopandamendthe structure of the Egyptianpetroleumsectorthrough
9. separatingthe activitiesof the natural gasand petrochemicalsfromthe activitiesof the Egyptian
General PetroleumCorporation,andestablishingastrongentityforeach of them, inadditionto
focusingthe attentiononUpperEgyptthroughestablishinganindependententity.Afteraddingthe
activitiesof the mineral resourcestothe dutiesof the ministryof petroleumandestablishingthe
Mineral ResourcesAuthorityonthe 14th of October2004, the petroleumsectornow consistsof five
strongentitiescooperatingandintegratingtomake the bestuse of petroleumandmineral resources
wealth.Theyare:
The EgyptianGeneral PetroleumCorporation “EGPC”
The EgyptianNatural Gas HoldingCompany “EGAS”
The EgyptianPetrochemicalsHoldingCompany “ECHAM”
GanoubEl-Wadi HoldingCompany “GANOPE”
The EgyptianMineral ResourcesAuthority. “EMRA”
10. 3. Research Methodology
Thischapter includedadiscussiononthe appropriatenessof the researchdesign,basedonthe
hypothesisselected.Inadditionit'll discuss the datacollectionandthe analysisproceduresused,a
reviewof the instruments selectedaswell aspotential limitationsof thisstudy.
3.1 Conceptual Framework and hypotheses development
When data is collected, it will be used to test the following hypothesis.
Hypotheses
H01: There is nosignificantimpactof Laissez-Faire leadershipstyles onthe performance of Oil &Gas
sectorinEgypt.
H11: There is significant impactof Laissez-Faire leadershipstylesonthe performance of Oil&Gas sector
inside Egypt.
Egyptian
Ministry of
Petroleum
EGPC
EGAS
ECHAMGANOPE
EMRA
11. H02: There is nosignificantimpactof Transactional leadershipstyles onthe performance of Oil &Gas
sectorinEgypt.
H12: There is significant impactof Transactional leadershipstylesonthe performanceof Oil&Gassector
inside Egypt
H03: There is nosignificantimpactof Transformational leadershipstyles onthe performance of Oil &
Gas sector inEgypt.
H13: There is significantimpactof Transformational leadershipstylesonthe performance of Oil&Gas
sectorinside Egypt
3.2 InstrumentsSelectedforThis Study
The instrumentusedinthisstudywasthe MultifactorLeadership Questionnaire(MLQ).The MLQ was
originallydevelopedbyBass(1985) as a seven factormodel fortransactional andtransformational
leadershipthe shortformisa validatedinstrumentwith45itemscommonly usedtogatherleader
feedbackin identifyingtheirleadershipbehaviorswhichprovidesaconfirmatoryfactoronthe
presence of transformationalleadership.The instrumentutilizedinthisstudyisa 45 items
surveyutilizinga5-pointLikertscale,rangingfrom5 (frequently)to1 (notat all).
Because of itslongevityof use,itisa proveninstrumentinsuccessful assessmentof transformational
leadership(Waggoner,2009).The instrumenthasprovenbothreliableandvalidasa leadership
assessmentinstrumentforleader-managersinwidelydiverse settings,measuringthe componentsof
transformational leadershipinnearly300researchprojects(Bass&Avolio,2000).
Reliabilityscoresforthe total itemsandforeachleadershipfactorscale rangedfrom .74
to .94. Bassand Avolio(2000) have definedafull range of leadershipbehaviorsand leadershipoutcomes
measuredbythe MLQ. The scalesacross all leadershipdimensions have reliabilitiesthatare generally
high,exceedingcutoffsrecommendedinliterature(Bass&Avolio,2000).There are twoformsof the
MLQ, a rater formand a leaderform.Thisresearchwill use the leaderformtoassesstheirown
leadershipstyle.The MLQForm 5X isa self-reportingquestionnaireconsistingof 45 questions which
addresseshowoftenthe leaderdisplaysaspectrumof leadershipbehaviors(Gardner&Stough,2002).
Five sub-scalesconsistingof fouritemseachassessthecharacteristicsof transformational leadership
includingidealizedinfluence attributes,idealizedinfluence behaviors,inspirational motivation,
intellectual stimulation,and individualconsideration.Three sub-scalesof fouritemseachmeasure the
transactionalleadershipcomponentsof contingentrewards,active managementbyexception,and
passive managementbyexception(Avolio&Bass,1995: Howell &Avolio,1993).
TheMLQ 5X also measureslaissez-faire leadershipwithfouritems.The restof the items ratedare extra
effort,perceivedleadereffectiveness,andemployee satisfactionwiththe leader.
3.2 Research Design
12. We use the multifactorleadership questionnaire tomeasure the practical impactof Laissez-Faire,
Transactional & Transformational leadership stylesonvariousoil &gas companiesperformance.Every
questionmusthave ameaningrelatedtothe hypothesis.The questionnaire will cover45 questionswill
helpusto analyze the impactof the three leadershipstyles onorganizationperformance
3.3 Populationand Sampling
A stratifiedrandomsample willbe consideredforcollectingthe data.The studywill be appliedonOil &
Gas sector.Three strata will be consideredaccordingtothe level of financial performanceinOil &Gas
sectorwhichare listedashigh,moderate &low financial performance accordingtothe formal data
received fromCAPMAS
3.4 Data Collection
Primarydata will be collectedthroughansweringaquestionnaire thatwill be spreadamong 9Oil & Gas
companieswithdifferentperformance accordingtothe data collectedfromCAPMAS (3companieswith
highfinancial performance,3companieswithmoderate financial performance &finally3companies
withlowfinancial performance).The questionnaire will be answeredby middle &seniormanagers in
each of these companies ordertoevaluate theirorganization'sleadershipstyleandthe degree thisstyle
impactedthe organizationperformance
3.5 Research Variables
DependentVariable:Organizational performance
Independentvariable:Laissez-faire Leadershipstyle;Transactionalleadershipstyle&Transformational
leadershipstyle ( see belowfigure)
13. 3.6 Data Analysis
We'll analyze the collecteddatausingStatistical package forsocial science (SPSS).SPSSprovidedthe
descriptive and inferentialstatistical analysisapplications.Thisanalysisincludeddataconversionand
descriptive statistical analysisincludingmaximums,minimums,means,andstandard deviationforeach
groupof data. The focusof the researchhypothesiswasthe correlation betweenthe listedvariablesof
interestwhere the independentvariableswillbe the 3 leadershipstyleswhile the dependentvariable
will be the organizational performance.We'll checkwhetherthe proposedmodelwhichindicate the
impactof the independentvariable (The threeleadership styles)onthe dependentvariable
(Organizationperformance)willbe significantornot usingthe following3measures:
a. ANOVA test
b. T-test
c. Coefficientof determination
PreliminaryReferences
Avolio,B.J.andBass,B.M.(2004),MultifactorLeadershipQuestionnaire:Manual &Samplerset,
3rd Ed.,Mind Garden, RedwoodCity,CA.
Bass,B.M. (1985) Leadership&performance beyondexpectation.NewYork:The free press
Fiedler,F.E.(1996).Researchonleadershipselection&training:One view of future,
administrativesciencequarterly
