Effect of idealised influence on employee engagement among Deposit Taking Savings and Credit Cooperative Organizations (SACCOs) in Nairobi, Kenya

Abstract

This study investigates the connection between idealized influence and employee engagement, specifically exploring how leadership trust, authenticity, shared values, and the quality of leader-member exchange influence this relationship. Deposit-Taking Savings and Credit Cooperative Societies (DT-SACCOs) face a competitive environment where employee engagement is important for success. Preliminary reports, including empirical research, suggest that some DT-SACCOs may face challenges with employee engagement, potentially impacting productivity and service quality. The current study examined the effect of idealized influence on employee engagement, given the crucial function of leadership in driving motivation and commitment. The study attended to the influences of leadership trust, authenticity, shared values, and leader-member exchange quality on employee engagement. The study was built on transformational leadership and social exchange theories as the anchoring and supporting theoretical frameworks, respectively. The study adopted a descriptive cross-sectional design, underpinned by a pragmatist philosophy. This approach involved the concurrent collection and analysis of both quantitative and qualitative data. Employees of the 46 Deposit-Taking SACCOs (DT-SACCOs) in Nairobi County were targeted, and a cohort of 347 participants was recruited using a random proportionate sampling method. Primary data were gathered using semi-structured questionnaires that incorporated both closed-ended (for quantitative data) and open-ended (for qualitative data) questions. Quantitative data collected was analysed by the use of descriptive statistics which include percentages, means, standard deviations and frequencies. The information was displayed by use of bar charts, graphs and tables. Data collected from open ended questions was analysed using the thematic analysis method. To examine the relationship between the study's constructs, a correlational analysis was conducted to determine the nature of the association between idealized influence and employee engagement among DT-SACCO employees in Nairobi County. In addition, the study was limited to descriptive research design, therefore, the study can confirm that a statistically significant association exists between leadership behaviours and engagement among employees in DT-SACCOs, but it cannot definitively state that one variable causes a change in the other. The study revealed a moderate level of employee engagement and demonstrated that the factors of idealized influence were present in the practices of leaders within the DT-SACCOs. However, the effects of authentic leadership and leader-member exchange were found to be the most profound. Based on these findings, there is a strong need for industry-wide policies as well as organizational strategies on idealized influence in order to maximize employee engagement within the sector. Despite its contribution in highlighting the value of idealized influence on team engagement, further research is needed to expand the geographical, contextual, and conceptual scope limitations.