Journal of Service Theory and Practice

Leadership style and service orientation: the catalytic role of employee

engagement
Sapna Popli, Irfan A. Rizvi,
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employee engagement", Journal of Service Theory and Practice, Vol. 27 Issue: 1, pp.292-310, https://
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JSTP
27,1 Leadership style and service
orientation: the catalytic role of
employee engagement
292 Sapna Popli
Department of Marketing, IMT Ghaziabad, Ghaziabad, India, and
Received 6 July 2015
Revised 15 November 2015 Irfan A. Rizvi
29 February 2016
30 May 2016
Department of OB&HR, International Management Institute (IMI),
18 July 2016 New Delhi, India
Accepted 19 July 2016

Abstract
Purpose – The purpose of this paper is to explore the roles of leadership style and employee
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engagement (EE) as drivers of service orientation (SO). The competing models approach used in this
study examines three models of influence on SO. The first model evaluates the influence of leadership
on SO, the second focuses on the influence of EE on SO and the third explores the influence of
leadership on SO through EE. The study provides evidence to support that the relationship between
leadership styles and SO is impacted by EE. The results suggest that organizations need to develop systems and
processes that focus on the employee and EE for definitive service outcomes. At a theoretical level, the paper
provides a direction for further exploration of an integrated theory of leadership and engagement to drive SO in
organizations.
Design/methodology/approach – This empirical study uses a cross-sectional descriptive design.
Hierarchical regression and mediation analysis were applied to process the data that were collected from more
than 400 front-line employees from five service sector organizations in the Delhi-National Capital Region
(Delhi-NCR) of India using validated instruments.
Findings – The results from this study reveal both direct and indirect relationships among the variables.
EE emerged as a critical variable that influences SO of employees. EE partially mediates the
transformational leadership style-SO relationship and also the passive-avoidant-SO relationship and it fully
mediates the transactional leadership-SO relationship. While all relationships of leadership-engagement,
leadership-SO and engagement-SO are significant, the mediating effects accentuate the importance of EE
in organizations.
Practical implications – Leadership style on its own has a direct bearing on EE and SO of employees,
the three associations are significantly impacted under the mediating influence of EE. With EE emerging
as a critical factor, organizations need to ensure engaging behaviors are measured and enhanced
throughout the employee-life-cycle including hiring, training, rewarding and managing performance. The
results of the study suggest that an integrated approach of developing and inculcating leadership styles
that drive EE could be the basis for leadership development programs especially in the service sector
organizations.
Originality/value – The originality of the paper is derived from the three variables studied in the context of
the sample characteristics (front-line employees, young), industry sector (across service sector) and
geographical location (Delhi-NCR-India). Not many empirical studies on these variables are available from the
region. The empirical evidence on the influence of EE adds weight to the growing strategic importance of EE
in organizations. The research also highlights leadership and EE together influence specific employee
attitudes and behavior (SO).
Keywords India, Leadership, Service sector, Employee engagement, Service orientation,
Transformational leadership style
Paper type Research paper

1. Introduction
Journal of Service Theory and
Practice A customer’s perception about an organization, its services and quality of service is
Vol. 27 No. 1, 2017
pp. 292-310
influenced to a large extent by her interactional experience with employees. The nature of
© Emerald Publishing Limited this experience impacts service outcomes like customer satisfaction, customer
2055-6225
DOI 10.1108/JSTP-07-2015-0151 loyalty, delight and various other service performance measures. Service literature
 suggests that service-oriented behaviors and attitudes impact service quality measures Leadership
(Schneider et al., 1980; Hogan et al., 1984; Keillor et al., 2000), and contribute significantly to style and
customer satisfaction (Schneider et al., 1980; Keillor et al., 1999; Liao and Chuang, 2004). service
Employee behavior, thus, is often an integral constituent of the service product. Heskett
et al. (1994) integrated and formalized the intuitive importance of a service employee attitude orientation
and behavior on customer loyalty in the service-profit chain model, and further highlight the
importance of “engaged employees” in driving the revenues and growth (Heskett et al., 293
2015). Every customer expects a high level of courtesy, responsiveness and helpfulness from
service providers, all of which are reflectors of an employee’s service orientation (SO).
For example, when a customer takes a tour package, experiences a hotel, deals with a bank
or a financial service provider, to a large extent she measures the quality of the service
provided by observing the attitudes and behaviors of the employees who deal with her.
Based on extensive research Fleming et al. (2005) had concluded that “the employee-
customer encounter is the factory-floor of sales and services” where value gets created and
that is what essentially needs to be measured and improved. As the core of the service
product gets commoditized, the organizations tend to rely on a service-culture (comprising
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of, besides other things, service-oriented employees) to provide customer delight and also
provide a sustainable competitive advantage through their employees.
In view of the critical role of employee behaviors in influencing customer and service
outcomes, it becomes imperative to identify the factors that drive these behaviors. Research
indicates that employees’ performance attributes are impacted by the leadership style
prevalent in the organization (Harter et al., 2002; May et al., 2004; Schaufeli et al., 2002).
Besides leadership, the other variable that seems to drive positive employee behavior and
has started receiving significant attention is “employee engagement (EE).” EE influences
profitability through its impact on productivity, sales, customer satisfaction and retention,
enhanced safety, customer loyalty (Hewitt Associates, 2004; Markos and Sridevi, 2010;
Ellis and Sorensen, 2007). Leadership and EE association is also well documented with
Carasco-Saul et al. (2014) citing more than 20 specific research studies highlighting the
significance of this association.
This paper empirically explores the association of leadership, EE and service behaviors as
highlighted in the previous paragraphs. The specific research questions being explored are:
RQ1. Does leadership style influence SO?
RQ2. Does EE influence SO?
RQ3. What role does EE play in the leadership-SO relationship?
The literature review presented in the following section indicates three possible ways in
which SO gets influenced. First, through leadership style (transformational, transactional,
passive-avoidant) – the leadership hypothesis (Model A); second, through EE – the
employee hypothesis (Model B); and the third, through both paths – the mediation
hypothesis (Model C) – where leadership affects SO but mainly through its effect on EE.
Each model has different implications for the organizational leadership team as well as
for the organization. If the way to influence SO is through the leadership path it would imply
that organizations must focus on leaders and their style. The employee path would require
the organization to develop programs and practices that can enhance EE. And, if SO of
the employees is to be influenced through both leadership and EE as visualized by the
mediation model, then it would require the organizations to ensure that leaders behave in
ways that enhances EE, so as to impact SO through direct as well as indirect paths.
The paper is structured to present the literature that has led to the development of these
three models, followed by an explanation of the methodology including the description of
the instruments, results, implications and finally a section on limitations.
 JSTP 2. Literature review and hypothesis development
27,1 2.1 SO
In academic research SO has been studied at two levels: the organizational and the individual.
At the organizational level, SO is viewed as an organizational philosophy and is treated as
part of the corporate culture, organizational structure, organizational climate and strategy
(Schneider et al., 1980; Garg and Chan, 1997; Wright et al., 1997; Lytle et al., 1998; Lynn et al.,
294 2000; Lytle and Timmerman, 2006; Chen, 2007; Gebauer et al., 2010; Bowen et al., 1989).
At the individual level, the literature stems from two streams: first, SO as a personality trait
(Hogan et al., 1984; McBride et al., 1997) and second, SO as what employees do (behaviors) in
service delivery (Dienhart et al., 1992; Johnson, 1996; Keillor et al., 1999, 2000; Wilson and
Frimpong, 2004; Jayawardhena and Farrell, 2011; Frimpong and Wilson, 2012).
Recent literature describes SO as an individual’s willingness to treat co-workers and
customers with courtesy, consideration, and tact (Bowen and Schneider, 2014); and includes
perceptiveness toward customer needs and the ability to communicate accurately and
pleasantly. Having a genuine desire to meet customer needs has been viewed as possessing
a customer or SO by various researchers (Brown et al., 2002; Homburg et al., 2002; Kelley,
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1992). In this paper SO has been operationalized using the definition given by Frimpong and
Wilson (2012) as “Behaviours displayed while interacting and delivering service to the
internal and external customer.” Behaviors that reflect SO include cooperation,
consideration, helpfulness, personal responsibility for work and going the extra mile.

2.2 Leadership style

Leadership style refers to “a relatively consistent pattern of behaviour displayed by a
leader/manager while dealing with and influencing subordinates.” Among various theories
of leadership styles relating to effective organizational performance, perhaps the most
prominent one is the transformational-transactional theory of leadership. The transactional/
transformational school of thought (Bass, 1985) is often acknowledged as a dominant
approach in the study of leadership ( Judge and Piccolo, 2004; Vera and Crossan, 2004;
Dulewicz and Higgs, 2005).
Transformational leadership style (TSFL) is characterized by a leader who
motivates and appeals to the ideals and values of subordinates by creating an inspiring
vision for the future. Transformational leaders are relationally focused and use
idealized influence, inspirational motivation, intellectual stimulation, and individualized
consideration to achieve superior results (Avolio et al., 1999). Transformational leadership
integrates the elements of empathy, compassion, sensitivity, relationship building and
innovation ( Jin, 2010).
Transactional leadership style (TSCL) is task focused and uses the process of exchange
to motivate subordinates by appealing to their personal drivers for work. The leaders take
advantage of their position, policy, power and authority to maintain control and get work
done through constructive and corrective transactions of reward and punishment. Bass
(1990, 1998) argues that transactional leadership behaviors lay the foundations for
transformational behaviors; a consistent delivery of rewards in return of work accomplished
builds trust in the leader. The same leader may use transformational or transactional style
at different times in different situations (Bass and Avolio, 1992; Yukl, 1998) or in different
amounts and intensity (Bass, 1985).
The passive-avoidant style (PAL) is characterized by avoidance of issues, decision-
making and accountability. This style involves taking corrective action and reacting only
when the problems become very acute, and often avoids making any decisions at all.
This study includes the three typologies of leadership style transformational,
transactional and passive avoidant as described by the full range leadership theory
developed by Avolio and Bass (1991).
 2.3 Leadership style and SO Leadership
Leadership is said to have a positive influence on a number of performance outcome including style and
customer satisfaction, sales performance, customer orientation, organizational commitment service
(OC), job satisfaction, job performance and financial performance among others (Humphreys
et al., 2003; MacKenzie et al., 2001; Stock and Hoyer, 2002; Rizvi, 2000). Hong et al. (2013) argue orientation
that the role of leadership is to construct a positive service climate. Their meta-analysis of
58 studies provides support for a strong association between leadership and employee 295
outcomes and in turn customer outcomes of satisfaction and loyalty. While there is evidence
that leadership styles influence employee and customer outcomes, however there is limited
conclusive research on which style works best. In a research study, Lindgreen et al. (2009)
while exploring “whether different marketing practices require different leadership styles”
concluded that the relationship between leadership style and marketing practice was dynamic
and linked. In addition they found that TSFL is positively associated with interaction and
network marketing, TSCL is positively associated with database and network marketing and
passive-avoidant leadership has no effect on any of the marketing practices.
Sales management literature also suggests that leadership style affects attitudes and
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behaviors of sales managers or sales people. Studies in this area have focused on examining
the influence of leadership on such outcome variables as trust, role ambiguity, sales
performance, and satisfaction with the job (MacKenzie et al., 2001) and found significant
relationships among the variables. Krishnan (2004) in a study on an India-based data found
that transformational leadership enhances the use of friendliness as a behavioral outcome.
Bowen and Schneider (2014) in their framework of service climate suggest leadership,
human resource management practices, and systems support as the antecedents of service
outcomes. The framework also indicates that there are important foundations (subsumed
under EE) that must exist in organizations for a service climate to develop. While service
climate is conceptualized differently from individual SO, SOs of various employees can be
aggregated to unit and organizational levels, producing can overall SO culture and climate.
Among the various drivers of SO, researchers have highlighted management support,
perceived organizational support, co-worker support, leader behavior, organizational reward
and recognition as the key antecedents (Teng and Barrows, 2009; Susskind et al., 2007;
Lytle et al., 1998; Schneider and Bowen, 1985). Hiller et al. (2011), in a 25 year literature review
on the outcomes of leadership used 1,161 empirical studies that cite examples of leadership’s
positive impacts on organizational citizenship behaviors (OCB), behavioral intentions such as
turnover, motivation, gaining commitment and affecting the way people feel.
Though, there is some evidence in research on the impact of leadership style on
organizational SO, market orientation and customer orientation, however individual SO as
an outcome has received limited academic attention. There also seems to be a dearth of
research in this area in the Indian context. In the context of the research gaps this study
investigates the following questions in the leadership-SO association domain: What is the
association of leadership style and SO in the service sector context in India? Do the three
typologies of leadership relate differently to SO? Thus the leadership hypotheses of this
research (Model A), tests the three propositions:
H1. There is a positive association between TSFL and SO.
H2. There is a positive association between TSCL and SO.
H3. There is a negative association between PAL and SO.

2.4 EE
In academic literature, EE has been approached in many distinct ways. The first approach is
based on Kahn’s (1990) “personal engagement” construct and the second approach often
 JSTP termed as the burn-out family, is based on Maslach et al. (2001) and Schaufeli et al. (2002).
27,1 The burn-out literature conceptualizes work engagement as the “positive opposite” of
psychological burn out. Two other popular academic approaches to explain EE are the
“satisfaction-engagement” approach by Harter et al. (2002) and the “multi-dimensional
approach” by Saks (2006). Kahn (1990) who is credited with conceptualizing the
major components of EE posits that “engagement focuses on how one commits herself
296 during the performance of the job.” In order for individuals to fully engage with their jobs,
three psychological conditions must be met in the work environment: meaningfulness
(workers feeling that their job tasks are worthwhile), safety (a feeling as though the
work environment is one of trust and supportiveness), and availability (workers having
the physical, emotional and psychological means to engage in their job tasks at any
given moment).
The evolution of EE is also said to have roots in employee OC and OCB. OCB is defined
as “those organizationally beneficial behaviours and gestures that can neither be enforced
on the basis of formal role obligations nor elicited by contractual guarantee of recompense”
(Organ, 1990, p. 46). However, engagement is viewed to mean more than what either OC or
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OCB imply. As a construct, EE continues to evolve beyond work engagement, job

involvement, OC and OCB.
Inspite of their different views most researchers agree on the three elements of EE that
encompass cognitive engagement, emotional engagement and behavioral engagement.
Shuck and Wollard (2010) define EE as “the process of positively motivating employees
cognitively, emotionally, and behaviourally towards fulfilling organizational outcomes.”
For the purpose of this study EE is operationalized as “the extent to which employees put
discretionary effort into their work over above the required minimum, in the form of time,
brainpower or energy, believe in what they do, find meaning, enjoyment and feel valued for
the work they do” based on development dimensions international (DDIs) definition by
Phelps (2009). This definition is in line with the objective of this research which is to focus on
employee behavior and service outcomes, and it also incorporates the propositions made by
Shuck and Wollard (2010) and Rich et al. (2010) in conceptualizing EE.

2.5 Role of engagement

In the service industry, the employee plays a significant role in creating, communicating and
delivering customer value. The value creation process hinges largely upon the extent to
which an employee is engaged, which is reflected in the many positive behaviors he/she
displays. Behaviors like going beyond the call of duty, going the extra mile, speaking highly
of the company, collaboration, proactive problem-solving, putting in extra hours, assisting
colleagues, sharing knowledge, offering creativity and participating in organizational
dialogue. Schneider et al. (2009) conclude that an engaged employee has the capability to
influence specific outcomes like: customer perception of quality, service-oriented behaviors
of friendliness, courtesy, helpfulness, OCB (intrinsic and customer oriented), customer
engagement, customer satisfaction and financial success. Other researchers have also found
that EE has a strong positive relationship with business success, both at the firm and
individual levels, and it yields outcomes including retention, productivity, profitability,
innovative behaviors, customer loyalty and satisfaction (Slatten and Mehmetoglu, 2011;
Markos and Sridevi, 2010; Coffman, 2000; Ellis and Sorensen, 2007; Perrin, 2003; Hewitt
Associates, 2004; Heintzman and Marson, 2005). The “service triangle” proposed by
Albrecht (1988) also indicates a tripartite relationship among the service organization, the
service provider (employee) and the customers.
A large body of research indicates that engagement is positively related to customer
satisfaction (Coffman, 2000; Ellis and Sorensen, 2007; Perrin, 2003; Hewitt Associates,
2004) and to employee attitudes and performance (Rich et al., 2010). Kruse (2012) suggests
 that “an employee’s discretionary effort results in the engagement-profit chain, as Leadership
such an employee is more productive, renders better service, and even stays in their jobs style and
longer. All of this leads to happier customers, who buy more and refer more often, service
which drives sales and profits higher, finally resulting in an increase in stock price.”
He cites 20 plus research studies that show that engagement is correlated with variables orientation
like service, sales, safety, retention and profit. Engaged employees are more likely to exert
extra efforts and display citizenship behaviors such as altruism, civic-virtue, 297
sportsmanship, etc. (Christian et al., 2011; Schaufeli et al., 2006; Shimazu and Schaufeli,
2009) through which they tend to facilitate efficient functioning and smooth running of the
organization and thereby enabling organizations to sustain high performance
and effectiveness.
It is evident from the research cited above that EE has a significant impact on many
individual and organizational performance outcomes. While most of the service research in
the engagement domain has been focused on outcomes such as service quality, customer
perception of quality, customer satisfaction and similar indices, this study specifically
focuses on “SO” as an outcome of EE. Therefore the employee hypothesis of this research
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(Model B) is stated as follows:

H4. There is a positive association between EE and SO.
In addition to understanding the direct impact of EE on SO, it may be of value to explore
how EE in combination with other relevant variables like leadership influences SO.
A close analysis of the drivers of EE indicates that leadership is critical in fostering EE.
Wang and Walumbwa (2007) and Macey and Schneider (2008) suggest that leadership is the
single biggest factor in affecting employee perceptions in the workplace and workforce
engagement. Attridge (2009) asserted that leadership style, applying to leader-follower
interactions, is critical for promoting EE. Engaged leaders coach proactively for success,
inspire loyalty and trust, and build an environment in which employees are motivated and
engaged (Wellens et al., 2005).
In a recent leadership-EE relationship review, Carasco-Saul et al. (2014) discuss various
studies that have treated engagement as a mediator in leadership’s relationship with other
outcome variables. They summarize that “transformational leadership is partially mediated
by employee engagement in influencing the organization’s performance improvement in
creating knowledge (Song et al., 2012), customer relationship (Yuan et al., 2012), and
employee’s career satisfaction (Vincent-Hoper et al., 2012).” In addition they found that
“transformational leadership style and it is fully mediated by engagement in influencing
employees’ extra-role performance positively (Salanova et al., 2011) and intentions to leave
reversely (Wefald et al., 2011).”
While the mediating role of EE in leadership and its association with various outcome
variables has been studied it needs further exploration with different leadership styles
(Carasco-Saul et al., 2014), across sectors and countries. Bowen and Schneider (2014) also
highlight the need to evaluate other styles of leadership and their relationship with service
behaviors. Cheung and To (2010) studied and reported that management commitment to
service quality alone does not produce positive organizational outcomes unless linked with
effective employee involvement. Thus, the third research question that arises in this context
is the role of EE in the leadership style-SO relationship. The possible influence of leadership
on SO through EE (Model C), the mediation hypotheses, and the three hypotheses
formulated in this context are:
H5. EE mediates the relationship between TSFL and SO.
H6. EE mediates the relationship between TSCL and SO.
H7. EE mediates the relationship between passive-avoidant leadership style and SO.
 JSTP 3. Methodology
27,1 3.1 Sample and data collection
The study was conducted using a multi-cross-sectional descriptive design. Five service
sector organizations were selected on purposive sampling basis considering high customer-
contact, years of operation and location of outlets/branches in NCR region of Delhi as the
broad guidelines of homogeneity. Quantitative data were collected on simple random basis
298 from a list of front-line employees shared by these organizations. The front-line employees
were selected for the study owing to their largest customer-interface opportunity and time,
and also the responsibility for delivering the service. In total, 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 the Table I. The data reflect
that 73.9 percent of the respondents in this study are below the age of 30 years, 64.4 percent
of the respondents had an education up to graduate level, 64.7 percent were men and
35.3 percent were women reflecting the growing number of women in these organizations.
In total, 80 percent of the sample population had a work experience of less than ten years
with 58.6 percent of them having no more than five years of experience.
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3.2 Research instruments

Data on EE 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
established validity and reliability. The Cronbach’s α 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.
Data on SO were collected using the SO scale designed by Frimpong and Wilson (2012)
and further validated by Popli and Rizvi (2015) for an Indian context. The scale consists of
20 items, four of which are reverse scored, on a five-point Likert scale extending from
strongly agree to strongly disagree. The α reliability for SO scale was found to be 0.864.
The instrument captures employee’s perception of their colleague’s behavior with customers
and other colleagues so as to avoid socially desirable responses.

Type of classification Category Number of respondents Percentage in sample

Age Less than 25 years 118 35.9

25-30 years 125 38.0
30-35 years 66 20.0
More than 35 years 20 6.1
Education Class XII 35 10.6
Graduate 177 53.8
Post graduate 117 35.6
Gender Male 213 64.7
Female 116 35.3
Sector Banking 52 15.8
Hotel 71 21.6
Retail 84 25.5
NBFC 71 21.6
Trading 51 15.5
Total work experience Less than 2 years 83 25.2
2-5 years 110 33.4
Table I. 5-10 years 90 27.4
Demographic profile More than 10 years 46 14.0
of respondents Notes: Total number of respondents: n ¼ 329
 To capture the leadership style, a subordinate’s perception of his superior’s leadership style Leadership
was collected through the standardized multi factor leadership questionnaire (MLQ) style and
5X-short rater form. The MLQ (Bass, 1985; Bass and Avolio, 1995) is the most widely used service
instrument to assess transformational leadership theory (Avolio and Bass, 1991; Hunt, 1999;
Yukl, 1999; Kirkbride, 2006) and is considered to be the best validated measure of orientation
transformational and transactional leadership (Ozaralli, 2003, p. 338) The instrument
consists of 45 items of which 36 statements measure the nine leadership behaviors of 299
idealized influence (attributed), idealized influence (behavioral), inspirational motivation,
individualized consideration, intellectual stimulation, contingent rewards, management by
exception (active), management by exception (passive) and laissez-faire. The α reliability for
the each of the three leadership styles was measured at 0.902 for transformational items
(TSFL), 0.747 for transactional (TSCL) and 0.785 for passive-avoidant (PAL).
The Cronbach’s α 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.
The permission to use MLQ was obtained from Mind Garden Inc., EE from DDI, and SO
scale from Dr Frimpong.
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4. Results and discussion

The data have been analyzed using multiple regression followed by mediation analysis.
A series of multiple regression has been used to test the first four hypothesis followed by
hierarchical regression to identify variance in SO that may be explained due to engagement
while controlling for leadership styles. The H5-H7 are tested using mediation analysis based
on Baron and Kenny’s (1986) approach. The tools of analysis have been kept simple so as to
retain the focus on the variables and their influence and ease of understanding and
implementation for both practice and further research.

4.1 Descriptives
The mean and median scores of engagement are 78.17 and 77, respectively, as reflected in
the Table II. Within the sample, the 75th percentile lies at a score of 85 meaning if we were to
use these engagement scores to categorize employees, the employees with a score of 85 and
more would qualify as engaged employees and those with less than 73 may be termed as
actively disengaged. A similar analysis of the SO scores reveals a mean and median score of
77.79 and 77, respectively. Respondents scoring more than 84 may be categorized
displaying high SO, whereas those scoring below 72, categorized as having low-SO.
The mean scores of transformational, transactional, and passive-avoidant leadership
styles have been calculated using the scoring key for the MLQ 5X form. The MLQ is not
designed to encourage the labeling of a leader as transformational or transactional, rather it
is more appropriate to identify a leader or a group of leaders as “more transformational than
the norm” or “less transactional than the norm.” The mean scores for transformational

α Reliability Mean Median SD TSFL TSCL PAL SO

TSFL 0.902 2.89 2.90 0.512 – – – –

TSCL 0.747 2.86 2.87 0.563 0.716** – – –
PAL 0.785 1.37 1.25 0.806 0.079* 0.083* – –
SO 0.864 77.79 77.00 9.55 0.390** 0.362** −0.260** –
EE 0.898 78.17 77.00 9.90 0.422** 0.480** −0.166** 0.681**
Notes: TSFL, transformational leadership; TSCL, transactional leadership; PAL, passive-avoidant Table II.
leadership; EE, employee engagement; SO, service orientation. *Not significant; **correlation is significant Mean and median
at p o0.001 scores
 JSTP leadership, transactional leadership and passive-avoidant leadership are 2.89, 2.86 and
27,1 1.37 (Table II), respectively, and indicate that the leaders in these organizations are
largely perceived as displaying both transformational and TSCLs fairly often and
the PAL sometimes.

4.2 Regression analysis

300 Preliminary analyses were conducted to ensure that there is no violation of the assumptions
of normality, linearity and homoscedasticity. None of the correlation coefficients (Table II)
amongst the predictor variables (transformational, transactional, and passive-avoidant
leadership style, and EE) were above 0.9, and the variance inflation factors were also less
than three, indicating that multi collinearity was unlikely to be a problem in this data set
(Tabachnick and Fidell, 2007).
In the first set of multiple regression equations (Table III), three leadership styles
(transformational, transactional and passive avoidant) were entered as predictors and SO as
the dependent variable. This leadership model (Model A) was found to be statistically
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significant with F(3, 325) ¼ 30.08; p o0.001 and explained 21.7 percent of variance in
SO. The EE SO relationship (Model B) is reflected in the same table and shows a statistically
significant model F(1, 327) ¼ 283.1; p o0.001 and an explained variance of 46.4 percent
(R2 ¼ 0.464).
In the third model, hierarchical regression was used by first entering the leadership
variables in the first step and then EE in the second step, enabling controlling for the
leadership styles. After entry of EE the total variance explained by the model as a whole
was 49.4 percent (F(4, 324) ¼ 81.19; p o0.001) (Model C). The introduction of EE in this
equation explained an additional variance of 28.3 percent in SO, after controlling for
leadership styles (R2 Change ¼ 0.283; p o0.001). The “effect size” attributable to the
addition of EE in the model is 0.5474 as calculated using the effect size calculator for
hierarchical regression (Soper, 2015). These results provide evidence to accept H1-H4.
The analysis also reflects that in Model A, all three leadership styles were statistically
significant with transformational style of leadership having the highest standardized beta
value ( β ¼ 0.258, po 0.001) followed by passive avoidant ( β ¼ −0.227, p o0.001); TSCL was
the least important predictor variable in contributing to the variance in SO score ( β ¼ 0.159,
p o0.05). In Model C, three out of four predictor variables were statistically significant, with
EE reflecting the highest standardized beta value ( β ¼ 0.618, po 0.001) followed by the
transformational leadership ( β ¼ 0.162, p o0.005) and passive avoidant ( β ¼ −0.15,
p o0.001). TSCL was not found to be significant in this model. The results indicate a change
in explained variation of SO in the presence of EE, thus providing strong evidence that EE
does influence the relationship between leadership style and SO. The β coefficients and
significance of the predictor variables independently also indicates the change in
relationships in the presence of engagement. Mediation analysis was used to further
investigate the individual relationships of the three leadership styles with SO in the
presence of EE.

4.3 Mediation analysis

In mediation analysis, instead of establishing a direct relationship between the independent
and dependent variable, it is hypothesized that the independent variable has an
indirect effect on the dependent variable through the presence of a mediator variable.
As a consequence of the introduction of the mediator (EE), the effect of the independent
variables (leadership styles) may change. The causal-steps approach developed by Baron
and Kenny (1986) is the most cited approach to test simple mediation (MacKinnon and
Fairchild, 2009; Hayes, 2009) despite its limitations (Figure 1).
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Model summaryc
Change statistics
Model R R2 Adjusted R2 SE of the estimate R2 change F change df1 df2 Sig. F change
A 0.466a 0.217 0.210 8.48811 0.217 30.087 3 325 0.000
B 0.681b 0.464 0.462 7.00226 – – 1 327 0.000
C 0.708c 0.501 0.494 6.79088 0.283 183.754 1 324 0.000
Coefficientsd
Model Unstandardized coefficients Standardized coefficients Collinearity statistics
B SE β t Sig. Tolerance VIF
A (Constant) 59.875 2.963 20.20 0.000 – –
Transformational 4.817 1.311 0.258 3.673 0.000 0.487 2.055
Transactional 2.689 1.193 0.159 2.255 0.025 0.486 2.056
Passive avoidant −2.686 0.583 −0.227 −4.607 0.000 0.992 1.008
B Constant 26.423 3.077 8.596 0.000 – –
Employee engagement 0.657 0.039 0.681 16.828 0.000 – –
C (Constant) 27.957 3.341 8.367 0.000 – –
Transformational 3.016 1.058 0.162 2.852 0.005 0.479 2.088
Transactional −1.057 0.993 −0.062 −1.064 0.288 0.449 2.229
Passive avoidant −1.780 0.471 −0.150 −3.777 0.000 0.972 1.028
Employee eng. 0.596 0.044 0.618 13.556 0.000 0.742 1.348
Notes: aPredictors: (constant), passive-avoidant score, transformational score, transactional score, dependent variable: service orientation; bpredictors: (constant),
employee engagement, dependent variable: service orientation; cpredictors: (constant), passive-avoidant score, transformational score, transactional score, employee
engagement; cdependent variable: service orientation; ddependent variable: service orientation score
Leadership

301
service
style and

Model summary and

orientation

Table III.

coefficients
 JSTP Baron and Kenny’s approach has been used to test the H5-H7, incorporating the
27,1 recommendations made by Zhao et al. (2010) in the way mediation is conceptualized and
tested. In their paper Zhao et al. (2010) argue for the need to test the significance of the
“indirect effect” using bootstrap procedures given by Preacher and Hayes (2004) and
also classifying the mediation type considering possibilities of complimentary or
competitive mediation. The leadership styles-EE SO associations have been analyzed in
302 independent mediations for each of the three styles: transformational, transactional and
passive-avoidant.
In the case of transformational leadership, the results (Table IV) reflect that there is a
significant direct influence of transformational leadership on EE (a ¼ 0.42; po 0.001), and
that there is a significant direct influence of EE on SO (b ¼ 0.63; p o0.001). The total effect
(c) of transformational leadership on SO before entering the mediator was significant with
(c ¼ 0.390, p o0.001). When EE acts as a mediator, the influence of transformational
leadership on SO gets reduced to (c’ ¼ 0.12, po 0.001). The total effect of transformational
leadership on SO (c ¼ 0.39) is apportioned into a direct effect (c’ ¼ 0.12) and an indirect
mediated effect (ab ¼ 0.264). The indirect effect was tested using bootstrapped confidence
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intervals (Preacher and Hayes, 2004). The lower end point of the two-sided bias corrected
bootstrap confidence interval for the indirect effect of TSFL on SO was 0.188 and the
upper end point is 0.334. This interval does not include a zero and therefore establishes a
significant indirect effect. The results support a partial mediation model since the total
effect of transformational leadership on SO attenuated slightly but remained significant
in the presence of EE. In newer approaches to mediation, this form of mediation is
referred to as “complementary mediation” (Zhao et al., 2010), where a × b is significant,
c significant, and a × b × c positive. The effects of EE on transformational leadership-SO
relationship are similar to the mediating effects found in studies relating transformational
leadership to various performance outcomes (Song et al., 2012; Vincent-Hoper et al., 2012;
Yuan et al., 2012).
In the case of transactional leadership-SO relationship after the entry of EE as a mediator in
the equation, transactional leadership no longer remained significant, supporting a
full-mediation model (Table V). The direct influence of transactional leadership on EE was

Mediating
Variable (EE)
a b

c’
Independent Dependent
Figure 1. Variable (LS) Variable (SO)
c
The mediation model

Standardized β (direct) R2 Standardized β with EE added to the model R2

TSFL and SO 0.390*** (c) 0.152 0.124** (c’) 0.477

Table IV. TSFL and EE 0.422*** (a) 0.178
Influence of
EE and SO 0.681*** 0.464 0.629*** (b)
transformational
leadership on Notes: TSFL, transformational leadership; EE, employee engagement; SO, service orientation. *,**Significant at
employee engagement p Valueso0.01 ando0.001, respectively
 found to be significant (a ¼ 0.480, po0.001); and so was that of EE on SO (b ¼ 0.656, po0.001). Leadership
The total effect (c) of transactional leadership on SO was also significant (c ¼ 0.365; po0.001), style and
when engagement acts as a mediator, it transmits almost all (ab ¼ 0.315; po0.001) service
of the influence of transactional leadership on SO. The indirect effect was found to be
significant using bootstrapped confidence intervals (0.248-0.387 were the lower and upper orientation
bounds). It can thus be concluded that the indirect effect of engagement is significantly
different from zero at po0.001, and EE fully mediates the relationship between transactional 303
leadership and SO.
In case of the passive-avoidant leadership, its total effect on SO (c ¼ −0.260) is
apportioned into a direct effect (c’ ¼ −0.152) and an indirect mediated effect (ab ¼ −0.109),
and all the three relationships were found to be significant at p o0.001 (Table VI).
The significance of “ab” for the indirect effects in the mediation analysis was determined
using bootstrapping procedure and found to be significant (lower bound at −0.165 and
upper bound at −0.054). The results support to a partial mediation model for passive-
avoidant-SO relationship.
The study found partial (complementary) mediating effects of EE in the transformational
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leadership-SO relationship and also in the passive-avoidant-SO relationship, and full-

mediation effects of EE in the transactional leadership-SO relationship. While there is a
positive impact of TSFL on SO, a substantial part of this impact is due to the indirect effect
of EE. In addition, the data indicate that the effect of TSCL on SO of the employees is fully
transmitted via EE. The passive-avoidant leadership style has a direct negative influence on
both EE and SO.
Of the three hypothesized models, the mediation model (Model C) of leadership styles
influences on SO through EE thus emerges as the most effective in explaining SO.

5. Implications
Some of the major findings of managerial relevance of the study can be summarized as
follows: an engaged employee has a relatively higher SO than a disengaged one; leadership
style impacts subordinate SO, but this impact gets all the more pronounced if the employees
are engaged; the TSFL is relatively more conducive in driving service-oriented behaviors as
compared to transactional style; the PAL has a negative influence on SO; and EE is a key
variable in influencing SO.

Standardized β (direct) R2 Standardized β with EE added to the model R2

TSCL and SO 0.362*** (c) 0.131 0.046 (c’) not significant 0.466 Table V.
TSCL and EE 0.480*** (a) 0.230 Influence of
EE and SO 0.681*** 0.464 0.659*** (b) transactional
Notes: TSCL, transactional leadership; EE, employee engagement; SO, service orientation. Significant at leadership on
***po 0.001 employee engagement

Standardized β (direct) R2 Standardized β with EE added to the model R2

PAL and SO −0.260*** (c) 0.068 −0.152*** (c’) 0.486

Table VI.
PAL and EE −0.166*** (a) 0.027
Influence of passive-
EE and SO 0.681*** 0.464 0.656*** (b) avoidant leadership
Notes: PAL, passive-avoidant leadership; EE, employee engagement; SO, service orientation. Significant at on employee
***po 0.001 engagement
 JSTP These findings have implications on a number of managerial practices like employee hiring,
27,1 training, performance management, recognition, reward and employee development.
At the time of hiring organizations need to carefully select leaders who display the ability to
stand with and for their teams, who are action oriented, and are able to motivate individuals
for higher performance. A person occupying a leadership role is expected to act like one,
make her presence felt, and intervene in matters of team performance consistently. Failing
304 to do so will make her an “absentee leader” who has a negative influence on employees and
their service delivery behaviors. It is not only important to hire people with pronounced
leadership styles (transactional or transformational), but is equally critical to help them
acquire such behaviors through learning and development interventions. Training
initiatives normally focus on developing “what to do” behaviors that are positive, some
focus on making employees understand “what not to do” while leading teams would be
useful in reducing the passive-avoidant behaviors.
As indicated by the results, leadership needs to foster EE so as to be able to influence SO.
While evaluating employee performance, the service sector organizations in particular need
to focus on the ability of the managers and leaders to drive engagement. “What gets
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measured gets done” may be a cliché but holds true. Therefore, EE levels and their drivers,
including leader behavior, need to be measured regularly. The leadership behaviors that
drive engagement need to be identified, developed and given a higher weightage in the
performance management system. For an example a measure of an employee’s perception of
his/her leaders style and more specific measures of a leader’s ability to enthuse, involve and
engage team members may be included in performance assessments and fed into the
broader human resource framework.
EE thus needs to be viewed as an organizational strategy, rather than a series of events,
retreats or metrics. It should be a key leadership goal, one that involves all members of the
organization (Robinson et al., 2004), irrespective of levels and has specific action steps to
build it (Shaw, 2005). Close attention is also required to be paid by organizations to the other
drivers of engagement. Besides leadership styles, supportive organizational culture,
feedback, trust, career advancement opportunities, effective and transparent human
resource practices have been cited in literature to have a catalytic impact on building
EE (Robinson et al., 2004; Vance, 2006; Gallup, 2008; Wollard and Shuck, 2011;
SHRM/Globoforce, 2013; Aon-Hewitt, 2014; Popli and Rizvi, 2016). These organizational
attributes need to be focused through an appropriate human resource policy, systems,
practice, assessments and training of supervisors and leaders.
In conclusion, one can say that driving EE with appropriate leadership styles is critical
for service organizations to succeed in raising the levels of SO. The organizations that focus
on building an engaging culture may be able to provide greater customer value and
strengthen the service-profit chain. In a service organization, employees are the essence,
sum and substance of products and services. As Bersin (2014) puts it “They develop, deliver,
and support what customers experience every day.” This is what a service organization and
those leading them need to internalize and execute so as to achieve the desired levels of
service performance.

6. Limitations and further research

Data on the three variables from the same set of individuals (same source) may suffer from
potential response contamination, common method bias and social desirability. To address
this concern, the remedies recommended by Podsakoff et al. (2003) were adopted.
Procedurally, we counterbalanced the order of the independent and dependent variables
to avoid the priming effect caused by the question context or item embededness.
All the subjects were informed that there were no correct or incorrect responses, and that
confidentiality would be ensured. In addition the leadership measure was about front-line
 employee’s perceptions about their leaders and the SO scale was about their perception Leadership
about colleague’s behavior, this helps reduce social desirable responses as the respondent is style and
not responding about himself/herself. As reflected in the methodology while care about the service
validity and reliability of instruments and objectivity in participant responses has
been taken, some variances due to the common method bias may be present in the study by orientation
virtue of its design.
Future researchers may look at collecting the SO data from both customers as well as 305
employees to get multiple perspectives. It may also be worthwhile to test the influence of
age, hierarchy and role on these associations. Leadership influences many other aspects of
both an individual as well as organizations, some mediating variables may have been
omitted in theorizing the leadership-engagement-SO framework, especially in the case of
complimentary mediations. Data may also be collected and compared across sectors to
study the sectoral impact (hospitality, financial service or retail and other services) on
the associations of leadership style and engagement and on the outcome variable of SO.
The impact of organizational culture and human resource practices specific to each
organization could also be assessed as intervening variables. From an analysis perspective,
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competing models can also be analyzed using Structural Equation Modelling as it enables
estimating everything simultaneously.

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About the authors

Dr Sapna Popli is a Professor of Services Marketing and Consumer Behaviour. Her research and
consulting interests are in the areas of people development, services marketing and service orientation.
She is currently associated with IMT Ghaziabad as an Adjunct Professor in Marketing. Sapna has over
20 years of experience in teaching and research at various business schools in Delhi-NCR-India.
Over these years she has also been engaged in training, managing business programs, curriculum
development, student development, international collaborations, accreditations and partnership
development. Her work has been published and presented in the areas of customer satisfaction,
engagement, business education and services marketing. She has also been a Visiting Professor at
ESCA, Casablanca and at the Shanghai University Management Center. Dr Sapna Popli is the
corresponding author and can be contacted at: sapnapopli@gmail.com
Dr Irfan A. Rizvi is a Professor of Leadership and Change Management in the OB-HR area at IMI.
In his professional career of two decades, Dr Rizvi has taught at FMS, University of Delhi, and has been
a Visiting Professor at the Australian National University (Canberra), Shanghai University (Beijing
and Shanghai), and at the International Management Institute (Senegal). In addition, he has been a
Corporate Executive at the HCL Ltd and an Associate Vice-President R&D and a Leadership Initiative
at NIS Sparta. Dr Rizvi has been a Leadership Coach, Trainer and Consultant on various areas like
leadership, change management, performance management, self-development, etc. to number of
organizations in public, private (both national and trans-national) and non-governmental sectors in
India and abroad. In addition, he has extensively researched and published in the areas of leadership,
change management, and learning and development.

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