Leadership Styles and Performance of State Corporations in Kenya

Abstract

Purpose: State Corporations in Kenya today find themselves operating in a highly competitive environment and must overcome various challenges, be more organized and efficiently in order to survive the 21st Century market dynamics. The main objective of this study was to establish the influence of leadership styles on performance of State Corporations. Methodology: Anchored on the Resource Based Views of the Firm, the study employed a cross-sectional study design utilising mixed methods such as quantitative, qualitative and Descriptive analysis. One hundred and seventy-seven (177) state corporations were targeted where a total of 122 State Corporations were randomly selected and used in this study. The unit of observation was the Chief Executive Officer of each sampled organization since they are the vision carriers and accounting officers. MLQ-6S short form standard questionnaire was used based on works of Bass and Avolio (2004). Findings: This study found a significant and positive influence of leadership styles on performance of state corporations in Kenya (r=0.531, P<0.001, β =0.849, P<0.001). The study further examined influence of individual leadership styles and established that in a combined relationship the transformational leadership style is significant and positively related to the performance of state corporations (β1 = 0.420, P = 0.050). However, the transactional leadership style (β2 = 0.193, P =0.155) and passive/avoidant leadership behaviour (β3 = 0.241, P = 0.149) are insignificant. Unique Contribution to Theory, Practice and Policy: This study informs policy by advocating for leadership development frameworks that emphasize transformational and participative styles within state corporations. Practically, the study provides evidence-based recommendations for public managers to adopt inclusive, innovation-driven leadership approaches to improve accountability, responsiveness, and service delivery in Kenya’s state-owned enterprises.