A Study of the Effect of Psychological Motivation-Based Leadership Styles on Organizational Performance

Zhang Minjie, Rozaini Binti Rosli*, Dhakir Abbas Ali

Lincoln University College, Wisma Lincoln, 12-18, Jalan SS 6/12, 47301 Petaling Jaya, Selangor, Malaysia
*Corresponding Author’s Email: brightday@126.com

Abstract

Introduction: The exploration of how psychological motivation interacts with various leadership models to influence enterprise performance has emerged as a crucial area of investigation in modern management research, holding considerable practical value for corporate governance. Methods: This study constructs the analytical framework of leadership models and enterprise performance through "psychological motivation". Data were collected through a structured questionnaire and statistically processed using SPSS to assess the reliability and validity of the scales, inter-variable relationships and mediating pathways. Results: In this study, a total of 500 questionnaires were distributed through the Internet, with a valid recovery rate of 89.6%. The results of Cronbach's alpha showed that the measurement scales were stable and consistent among the sample population. The KMO and Bartlett's test of sphericity indicated that the measurement results were statistically significant and had excellent validity. The results of correlation analysis showed that the leadership model was strongly positively correlated with enterprise performance, and psychological motivation played a partial mediating role between the two. Conclusion: This study is helpful to improve the management efficiency of leaders and can carry out targeted management according to the characteristics of employees, which has certain reference significance for enterprise management and enterprise performance. Empirical findings substantiate all proposed hypotheses within this investigation. The analysis conclusively demonstrates that psychological motivation serves as a significant mediator in the relationship between leadership models and enterprise performance. Both intrinsic motivation and extrinsic motivation play a partial mediating role in this causal pathway.

Keywords: Leadership Style; Organizational Performance; Psychological Motivation

Introduction

Among the six modules of human resource management, performance management, as an independent module, is of great significance to employees, managers and enterprises. In recent decades, the methods of evaluating employees' job performance have become increasingly mature and diverse. The development and continuous improvement of assessment tools such as the key performance indicator (KPI) evaluation method, the Management by Objectives (MBO) performance evaluation method, the balanced scorecard, and the 360-degree performance evaluation show that enterprises are paying more and more attention to employees' job performance. With the rapid development of human resource management, enterprises are transforming from the traditional management model to the new three-pillar management model: the shared service centre, the centre

of excellence, and the human resource business partner. The ultimate goal is to achieve higher job performance targets for both enterprises and employees. In addition, job performance is also a research hotspot in organisational management psychology. Researches on related theories such as the two-factor theory, motivation theory and equity theory have always been the focus of researchers. It can be seen that job performance has become a research direction of significant concern in the fields of management and psychology.

In the context of rapid globalisation and technological progress, organisations are increasingly focused on enhancing their effectiveness and sustainability. Leadership, as a pivotal element in both academic studies and practical management, plays a crucial role in shaping employee behaviour, motivation, and overall performance. Recent studies, including those by Owotemu, Bernardi & Nwosu (2024), Khan et al. (2024), and Rachmat, Indratjahyo & Subagja (2023), highlight how different leadership styles affect employee performance and organisational effectiveness. Understanding this relationship is vital for ensuring an organisation's growth and resilience, so studying leadership behaviour is an ongoing priority in management research.

Research indicates that different leadership styles can have diverse effects on employee attitudes and behaviours (Maqbali & Khudari, 2024). These effects play a significant role in key areas, such as performance, innovation, and teamwork, all of which are important for organisational success. As organisations face the complexities of modern business environments, exploring various leadership styles has become increasingly important. Leaders who adapt their styles to suit the specific needs of their teams and the context they operate in tend to create higher levels of employee engagement and productivity.

Organisational climate refers to the environmental attributes that employees can perceive and that influence their work attitudes and behaviours (Paek & Lee, 2025). In 1926, Tolman first put forward the concept of "cognitive map," that is, individuals can perceive the surrounding environment and form corresponding cognitive maps in their minds to understand the external environment. The proposal of this concept laid the foundation for the theory of organisational climate, attracted widespread attention from numerous scholars, and triggered a new trend in the research on organisational climate. Some scholars' studies have shown that an organisational climate can play a positive role in promoting employee performance through work engagement. Employees' own characteristics and their working environment influence their work engagement status. In a good organisational climate, employees' emotions are easily influenced, which, to some extent, affects their work attitudes and then influences their work efficiency. Therefore, to some extent, the organisational climate affects employee performance. In view of this, when this article studies the impact of different types of leadership styles on employees' work performance, it will explore the role played by the mediating effects of organisational climate.

Enterprise Performance

Currently, Scholars have increasingly focused on exploring the mechanisms by which leadership models affect enterprise performance, going beyond the question of whether such an effect exists (Thapa & Parimoo, 2022). From theoretical and empirical evidence, researchers have identified a strong correlation between leadership models and enterprise performance. Recent studies have shown that effective leadership plays a key role in improving enterprise performance (Sylvester, 2024). Compared with transactional leadership, affective and shared leadership models show superior effectiveness in improving enterprise performance. Ausat et al., 2022, establishes the link between transformational leadership and improved enterprise performance. These findings together support the formulation of the following propositions.

H1: Leadership models have a positive correlation with enterprise performance.

H1a: Transactional leadership models have a positive correlation with enterprise performance. H1b: Transformational leadership models have a positive correlation with enterprise performance.

Psychological Motivation

Early studies viewed internal and external motivation as two separate components from each other. Intrinsic motivation stems from people's endogenous need for self-determination and a sense of competence. People with intrinsic motivation engage in a certain kind of work with a purpose directed toward the work itself, which provides pleasure, interest, and satisfaction of curiosity and stimulates behaviour in the absence of external rewards and pressures. Extrinsic motivation stems from external stimuli like bonuses and stress.

The Association Between Leadership Models and Psychological Motivation

Different leadership models have varying degrees of impact on employee satisfaction, employee motivation, and business innovation (Meirinhos et al., 2023). Transformational leadership usually focuses on employees' self-esteem, beliefs, and emotions; stimulates employees' internal psychological identification with the organisation or leader; and increases employee satisfaction (Muhajiroh, 2024). Transactional leaders usually clarify the job responsibilities of the employees in the company in a certain way and understand and satisfy their needs in order to motivate them to work hard (Guarana & Avolio 2022). Ruma, 2023, provides concrete evidence for the interrelationship between leadership models and psychological motivation. These findings together support the formulation of the following propositions.

H2: Leadership models have a positive correlation with psychological motivation.

H2a: Transactional leadership models have a positive correlation with internal motivation. H2b: Transformational leadership models have a positive correlation with internal motivation.
H2c: Transactional leadership models have a positive correlation with external motivation.

H2d: Transformational leadership models have a positive correlation with external motivation.

The Association Between Psychological Motivation and Enterprise Performance

Leaders change the behaviour of workers by influencing their psychological motivation, guiding it to conform to the direction that is conducive to the performance of the enterprise and improve enterprise performance (Iqbal, Hassan & Azam, 2024). Ma et al., 2023, confirmed that motivation and performance have a significant positive correlation in general. Rudiansyah, 2022, highlighted the key role of intrinsic driving forces in the process of business development. These findings together support the formulation

of the following propositions.

H3: Intrinsic motivation has a positive correlation with enterprise performance. H3a: Intrinsic motivation has a positive correlation with enterprise performance.
H3b: Extrinsic motivation has a positive correlation with enterprise performance.

The Bridge Effect of Psychological Motivation Between Leadership Models and Enterprise Performance

Leadership models affect employees in a few ways, thereby influencing enterprise performance (Restutiani, Cahyadi & Munandar, 2023). When a manager's management style is consistent with employees' perceptions, leadership models affect individual employees' skill learning and intrinsic motivation and even the ability of individual employees to seek and use feedback to improve relevant skills, thus improving employees' job performance, individual employees' job satisfaction, and ultimately realising the possibility of improved enterprise performance. Using motivation as a mediating variable, Putra and Ahmadi (2024) showed that leadership models can affect how well employees do their jobs by using motivation as a mediating variable. Employees will show more positive work behaviours because of psychological motivation, which will improve corporate performance. These findings together support the formulation of the following propositions.

H4: Psychological motivation mediates the relationship between leadership models and enterprise performance.

H4a: Internal motivation mediates between leadership models and enterprise performance. H4b: External motivation mediates between leadership models and enterprise performance. Methodology

Research Framework

In this study, the theoretical assumptions about the possible existence of certain correlations among the three variables, namely psychological motivation, leadership models, and enterprise performance, are derived from a combination of theories (Figure 1). Whether the hypothesised relationships among the variables exist or not needs to be further deduced and tested.

Figure 1: Framework Diagram Data Collection

The survey scale of this study is based on the mature scales of other researchers, and the questionnaire design of the scale is based on the object of this study. The questionnaire consists of four parts: respondents' personal basic information, leaders' leadership models, enterprise performance and psychological motivation. The first part of the basic personal information requires the respondents to fill in truthfully according to the actual situation. The scale in this study uses a standardised five-point Likert scale to assess leadership models and enterprise performance. The measurement tools ranged from 1 (indicating complete disagreement) to 5 (indicating complete agreement), allowing respondents to express how strongly they agreed with each statement. The fourth part of the psychological motivation scale uses a seven-point Likert scale, with a scale of 1 to 7 indicating the degree of agreement, where “1” means not at all in agreement and “7” means completely in agreement.

Variable Measurement

Dependent Variable: Leadership Models

This study mainly draws on the Multifactor Leadership Questionnaire (MLQ) (Li, 2018) about transactional and transformational leadership models, which contain seven dimensions: discretionary rewards; proactive management by exception; reactive management by exception; charismatic leadership; personalised care; intellectual stimulation; and motivational incentives. There are a total of 30 questions.

Mediating Variable: Psychological Motivation

The Motivation at Work Scale (MAWS) revised by Gagné et al. (2010) was used in this study. The MAWS consists of two parts: internal motivation and external motivation, of which external motivation is divided into three dimensions: extrinsic motivation, introjected motivation, and identity motivation. It also consists of 12 questions.

Dependent Variable: Enterprise Performance

This study refers to other scholars' research on enterprise performance. The scale contains 9 questions, involving financial performance and non-financial performance.

Control Variables

In this study, six factors were used as control variables: gender, age, education, position, length of service, and nature of the enterprise.

Data Collation and Analysis Data Recovery and Organisation

This study adopted the network questionnaire survey method to collect samples. The survey objects were ordinary employees and managers of enterprises. A total of 500 questionnaires were collected, among which 448 questionnaires were valid, and the effective recovery rate was 89.6%.

Reliability Testing

In this study, Cronbach's alpha was used to measure the reliability of the questionnaire, which provided crucial evidence for the stability and consistency of the measurement tool in the sample population. The Cronbach's alpha coefficient of the total scale is 0.912, significantly exceeding the established threshold (0.8). The Cronbach's alpha coefficients of the sub-variables of the questionnaire are distributed in (0.722, 0.931), which are greater than 0.7, indicating good internal consistency. KMO and bartlett sphericity tests were performed in this study. The KMO values of all scales were greater than 0.7, and the Bartlett sphericity test results were statistically significant (Sig.< 0.001), and the cumulative explained variance was greater than 55%, indicating good convergent validity. Meanwhile, the fitting indexes of the five variables met the validity requirements, indicating that the scale question items were set effectively.

Relevance Analysis

As shown in Table 1, transactional leadership exhibits a strong positive association with enterprise performance (β = 0.541, p < 0.01), and transformational leadership demonstrates an even stronger positive correlation (β = 0.783, p < 0.01). These results support hypotheses H1a and H1b. Transactional leadership models were positively correlated with internal motivation (y=0.425, p<0.01), and transformational leadership models were positively correlated with internal motivation (y=0.592, p<0.01); H2a and H2c were verified. Transactional leadership models were positively related to external motivation (y=0.591, p<0.01), and transformational leadership models were positively related to external motivation (y=0.499, p<0.01), as verified by H2b, H2d. Internal motivation was positively correlated with enterprise performance (y=0.589, p<0.01), and external motivation was positively correlated with enterprise performance (y=0.721, p<0.01); H3a and H3b were validated.

Table 1: Relationship Between Leadership Models, Psychological Motivation and Enterprise Performance

Note: * denotes a significance level of 0.05; ** denotes a significance level of 0.01; *** denotes a significance level of 0.001; same below.

Mediated Effects Test

This study validates the mediating variables in three steps. The first step is to determine if the regression model is valid. In this study, the two variables of leadership models and psychological motivation were firstly analysed by regression, respectively. Model 1 and Model 2 in Table 2 show that transactional leadership models are positively related to both internal and external motivation. According to Model 5 and Model 6 in Table 2, transformational leadership models and internal and external motivation are also significantly positively related. Therefore, it can be judged that there is a significant correlation between the independent variables and the mediating variables; that is, the regression model between the independent variables and the dependent variable is established. In the second step, it is judged that the regression model is established between the independent variables and the mediating variables. The regression analysis results presented in Table 2 (specifically Model 3 and Model 7) reveal statistically significant positive relationships between leadership models and enterprise performance. Both transactional and transformational leadership models demonstrate significant positive associations with enterprise performance, indicating strong correlations between the independent variables and the dependent variable. In the third step, the test judgement of mediating effect is carried out. Add the mediating variable in the regression model between the independent variable and the dependent variable. In the new model, test the regression coefficient between the independent variable and the dependent variable. If the regression coefficient is no longer significant, it means that the introduced “mediator variable” has a full mediation effect. If the regression coefficients are significant, the introduced “mediating variable” has a partial mediating effect.

As shown in Table 2, two mediating variables, internal motivation and external motivation, were introduced in Model 4. Transactional leadership maintains a statistically significant positive relationship with enterprise performance (r=0.231, p<0.001), but the regression coefficients are smaller than the path coefficients of the direct effects. This phenomenon indicates that the two psychological motivations play a partial mediating role in the relationship between transactional leadership and enterprise performance.

Using the same method described above, internal motivation and external action were introduced as “mediating variables” in Model 8. The regression test results of the relationship between transformational leadership models and enterprise performance are still significant (r=0.550, p<0.001), but the regression coefficients are smaller than the path coefficients of the direct effects.

This phenomenon indicates that the two psychological motivations play a partial mediating role in the relationship between transformational leadership and enterprise performance, and H4a and H4b are partially supported.

Table 2: Regression Results of Direct and Mediated Effects

Note: *** indicates P < 0.01; ** indicates P < 0.05; * indicates P < 0.1.

IM: Internal Motivation; EM: External Motives; EP: Enterprise Performance

Discussion

Several key findings emerge from the study: First, the analysis strongly confirms the significant impact of leadership models on enterprise performance. Both transactional leadership and transformational leadership have significant positive effects on enterprise performance. Second, the leadership model substantially affects psychological motivation. Transactional leadership has a positive effect on both intrinsic and extrinsic motivation, as does transformational leadership. Third, psychological motivation significantly affects corporate performance. According to Cerasoli, Nicklin & Ford (2014), motivation determines the direction, intensity, and sustainability of employees' performance behaviours. While the beneficial effects of intrinsic motivation on organisational performance have been widely recognised over the past three decades, the role of extrinsic motivation remains controversial, with only limited empirical research available (Eldahamsheh et al., 2021). This study provides further empirical evidence to support the significant positive correlation between intrinsic and extrinsic motivation and enterprise performance. Fourth, psychological motivation (intrinsic motivation and extrinsic motivation) partially mediates the relationship between leadership models and enterprise performance.

Limitations

This study has certain limitations that should be acknowledged. Firstly, the characteristics and needs of leaders and employees are complex and constantly evolving. These factors may coexist and influence each other, but they were not fully considered in this study. Secondly, the study employed a stratified sampling method and selected 35 enterprises from 5 provinces and 14 cities. Although this provides a certain level of representativeness, it does not constitute completely random sampling. This limitation may affect the generalisability of the findings.

Conclusion

The research on the relationship between leadership models and enterprise performance has become a focus of attention in the field of management in recent years, but there are fewer studies on the relationship between leadership models and enterprise performance based on psychological motivation. The results of the study strongly verified the mediating effect of psychological motivation in the process of leadership models influencing enterprise performance. Based on the influence leaders bring to the organisation's performance, leaders can formulate effective management plans according to employees' personal characteristics and work content, such as formulating effective incentive strategies, improving employee performance, and encouraging employees to love their jobs, so as to promote the improvement of enterprise performance. To address these limitations, future research can consider expanding the scope of the study to include a more diverse and broader sample. Additionally, refining the questionnaire content and evaluation criteria will help improve the accuracy and reliability of the findings. By incorporating these improvements, future studies can enhance the scientific rigour and extensibility of their research conclusions, making them more applicable to

various organisational settings.

Acknowledgment

This study includes steps of literature search, data collection, and data analysis. The authors extend their heartfelt appreciation to all individuals who provided assistance and support throughout the study.

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