International Journal of Entrepreneurship (Print ISSN: 1099-9264; Online ISSN: 1939-4675)

Research Article: 2022 Vol: 26 Issue: 2

The role of transformational leadership in human resources diversity in Saudi telecommunication companies

Ahmed Asfahani, University of Business and Technology

Citation Information: Asfahani A. (2022). The role of transformational leadership in human resources diversity in Saudi telecommunication companies. International Journal of Entrepreneurship, 26(2), 1-12.

Abstract

This study focuses on the question: what is the effect of transformational leadership on the human resource (HR) diversity of telecommunications companies in Saudi Arabia? The importance of this research arises from its association with two key topics for organizations, namely, diversity of HR, and transformational leadership. Therefore, the present study took the initiative to test the impact of transformational leadership on HR diversity. On the other hand, although this managerial thinking has long appeared in foreign studies, it remains rare in Arabic studies, which adds extra dimension of importance. This study provides senior management and decision-makers in telecommunications companies with a scientific and practical framework on improving HR diversity and the method of transformational leadership, all of which are modern management topics of high interest to companies. The study population consisted of the total number of workers in Saudi Telecom companies across various administrative and functional levels.

Keywords

Transformational Leadership, Human Resources Diversity, Telecommunication

Introduction

Recent changes in global trends for modern management concepts have brought special focus to the human element as an essential resource for an organization, comprising its intellectual energy and real wealth, and constituting a major influence on its success of an organization, and the source of its competitive advantage (Carneiro, 2000). The importance of the human element lies in its competencies and refinement in many scientific, practical, technical, behavioral aspects, as well as its contribution to achieving a business’s goals (Bassellier & Benbasat, 2004). HR diversity is an important area of focus, as it has become a key strategic objective of business organizations to adopt new and innovative administrative and organizational philosophies and policies (Gratton & Truss, 2003). We find diversity in terms of age, religion, ethnicity, experience, educational level, marital status, job rank, gender, and other dimensions (Vertovec, 2007). These differences and diversity may affect the behavior and thinking of workers within the organization, which requires management to deal with it in a way that serves the organization and supports it in achieving its goals, and is one of the most important keys to an organization’s improved performance (Atiyah, 2016).

The global interest in the concept of management leadership started at the beginning of the 20th century in order to keep pace with developments in the philosophical contents of managerial thought, and to face rapid changes in the global competitive environment, which represented a serious challenge to organizations’ survival (Roussel et al., 2018). New philosophical visions emerged in leadership styles represented by transformational leadership, which is capable of facing these challenges, as it is a leadership style that has become an important resource for organizations to gain competitive advantage (Bass, 1999). Using transformational leadership style enables organizations to clearly communicate their broader message and future vision to their employees, and to motivate them by knowing their individual needs, building trust and respect among them, stimulating their ideas, and inspiring and being a role model to them (Cohrs et al., 2019).

The telecommunications sector is one of the most advanced and rapidly changing sectors, and its changes are mainly evident in the increase in global and local competition in the market, as well as ongoing changes in customer demands for services. Workers in this sector have varied skills, abilities, and qualifications, and the nature of work in this sector is constantly renewing (Battistella, 2014). In order to achieve the highest investment in this field, it is necessary to adopt a transformational leadership style that is able to manage this HR diversity in a way that allows companies in the sector to benefit from this diversity through stimulating creative ideas, inspiration, influencing and motivating them, and taking into account all of their individual considerations. This is what puts the organization in a better commercial position, especially in the area of future competitiveness (Apoi & Latip, 2019).

The telecommunications sector is witnessing intense competition locally and internationally, dealing with a large segment of customers both within and outside Saudi Arabia, which requires qualified and trained human cadres able to meet the various customer requirements. Therefore, it is imperative that companies in this sector follow a transformational leadership approach that takes into account the personal and functional differences of workers, by adopting strategies to deal with HR diversity through training employees, and engaging them in decisions, and encouraging them to express and benefit from their own ideas. This gives a diversified view of all telecom companies’ activities and contributes to their being able to achieve their goals.

Based on the above, this study focuses on the question: What is the effect of transformational leadership on the HR diversity of telecom companies in Saudi Arabia?

The importance of the study stems from its association with two main topics of great importance in organizations, namely HR diversity and transformational leadership, especially since the existing research lacks inquiries into the Arab world in general and into Saudi society in particular. Therefore, the current study took the initiative to test the impact of transformational leadership on HR diversity in the context of Saudi Arabia. On the other hand, despite this managerial thought having emerged in foreign studies some time ago, its appearance in Arab studies is still rare, which adds additional importance to the current study. This main aim of this study is to provide senior telecommunications managers and decision-makers with a scientific and practical framework on the topic of HR diversity and the strategies of transformational leadership, all of which are modern administrative topics of key relevance to organizations.

Transformational Leadership

Business organizations today need to keep pace with the developments taking place in the world, especially in terms of technological progress, the increasing complexities of the business environment, and the heightened attention to and awareness of the need for comprehensive change and activation of interactive relations between leaders and subordinates (Barnett et al., 2001). One of the strategies to deal with these advanced patterns is transformational leadership theory, which is based on leadership with motivation. Transformational leaders provide extraordinary incentives for their followers, raise their morale based on mutual respect between all parties, activate the primacy of values, and stimulate their thinking towards finding new and creative solutions to problems that they encounter in the workplace. As a result, subordinates feel trust, loyalty, admiration, and respect for their leader (Dvir et al., 2004).

The term ‘transformational leadership’ was first used by Burns (1978) to distinguish between leaders who build a relationship of purpose and motivation with their subordinates, and leaders who rely extensively on the process of mutual benefits to obtain results. Burns defined transformational leadership as a process by which the leader and subordinates strive to advance each other to reach the highest levels of motivation and ethics. As part of this process, the transformational leader seeks to bring about positive changes in the way work is performed, and make the subordinates override their own interests in favor of the interests of others, not just through a system of award or punishment (Uchenwamgbe, 2013). Conger (2002) views transformational leadership as leadership that goes beyond providing incentives in exchange for desired performance, to developing and encouraging employees intellectually and creatively, and transforming their self-interests into an essential part of the organization’s mission. Transformational leadership can also be defined as the leader’s ability to clearly communicate the organization’s mission and future vision to employees, and to motivate them to achieve the organization’s goals by showing high moral behaviors, and by building trust and respect (Murphy, 2005).

Dimensions of Transformational Leadership

Idealized influence: The idealized influence occurs when leaders act as a symbol of the position they occupy, and where employees see them as an example of morals and values, and therefore express feelings of admiration, respect, and trust for them. This makes the leader a source of influence for the employees (Woods, 2003). The idealized influence also indicates the extent to which the leader inspires confidence in his followers (Judge & Piccolo, 2004), which is a vital aspect of the relationship between leaders and subordinates, and which is developed as a means of unifying the common tasks between them (Madanchian et al., 2016). The leader influences his subordinates by engaging in continuous communication with workers in the workplace, with the aim of achieving cooperation between them and convincing them that achieving their personal goals is not done in isolation from the achievement of the goals of the organization. This creates the unification of personal and organizational values, and strikes a balance between achieving the objectives of the organization and satisfying workers’ needs (Charbonneau, 2004).

Inspirational motivation: These are the behaviours through which leaders generate challenges for their employees by clarifying their expectations to their followers, encouraging team spirit, and adhering to organizational goals (Bass et al., 2003). Motivation occurs when a transformational leader adopts methods that seek to inspire and motivate workers to challenge difficulties, to continually strive to find meaning in their work, and then to link it to the goals of the organization (Avolio et al., 1999).

Individualized consideration: This represents the leaders who provide the right atmosphere for every employee to achieve their own goals and needs, through offering training and mentoring (Bass, 1999). In this case, the leader takes into account the individual differences of their employees, and deals with each of them in a specific way that suits individual goals, values, and aspirations (Bass & Riggio, 2006). The success of this individualized consideration depends on the extent of the leader’s ability to accurately understand individual employee needs and the differences between them, in an ideal way that ensures the organization can achieve its goals (Jiang et al., 2017).

Intellectual stimulation: This refers to the leader’s ability to lead his subordinates to communicate without routine problems, to utilize new methods, and to teach them to solve key problems with logical solutions (Bass, 1999; Bass & Riggio, 2006). The role of the leader here is to sympathize with employees, to listen to their ideas and suggestions, and to delegate powers that help them solve daily problems with ease, thus motivating them to innovate and challenge themselves (Jiang et al., 2017). Transformational leaders encourage employees to question their beliefs, satisfactions, and values that may be outdated or inappropriate for solving current problems. These leaders search for new ideas to encourage creative problem solving from employees (Sundi, 2013).

Human Resources Diversity

Diversity includes all the different characteristics and experiences that each individual enjoys and which distinguish them from others; it is the differences and disparities between individuals (Walker & Benton, 2013); and it is the characteristics that distinguish one individual from another, such as gender, values, customs, traditions, and race (Dessler & Varrkey, 2020). Diversity among individuals is not limited to organizations, but can be found in the fabric of society and in individual communities. Differences in religion, age, and gender, can be seen across different countries and organizations, and, if they are properly evaluated and integrated, they bring cultural diversity to organizations and states (Amadeo, 2013).

Dimensions of Diversity in Human Resources

There is a disagreement among researchers about how to define the dimensions of HR diversity, so we find that some have narrowed these dimensions and confined them to a small space, while others have expanded them. Some of these dimensions, regardless of their differences, are compatible with the Saudi environment in general, and the telecommunications sector in particular. This set of dimensions for HR diversity adopted by this study is as follows: gender, age, and educational background.

Gender: Gender is one of the most important and prominent areas of HR diversity, as the capabilities possessed by individuals vary due to social gender. There are benefits to social HR diversity within organizations that are reflected in the organization’s processes, such as creativity, innovation, speed in transferring knowledge, creative ways to solve problems, and team spirit (Díaz-García et al., 2013). In the past two decades, women have become an important source of human capital which may be as yet untapped, and with the development in information technology and the strengthening of the educational infrastructure for women, women have become more qualified and able to perform jobs that were in the past considered suitable only for men, and are now given the full scope for promotion or access to senior positions, without having to face this bias (Joy, 2016).

Age: This is one of the most important personal factors for HR diversity, as the work force is distributed and diversified into different age groups (Hertel et al., 2013). Age diversity has positive effects on organizations by offering different sources of ideas, efforts, and capabilities that distinguish the organization from others, as the younger employees are seen as more motivated, productive, and able to learn, and the older employees offer skills, high experience, and commitment to work (Stone & Tetrick, 2013). Age differences enhance productivity due to the interaction and harmony between skills and different points of view, and through the transfer of knowledge from one generation to another (Backes-Gellner & Veen, 2009). Diversity according to age was identified as one of the most important strategic capabilities in an organization, adding value over its competitors, and helping it create new markets and higher productivity (Joseph, 2014).

Educational background: The extent of compatibility between education and work requirements is an important matter (Teichler, 1999). The diversity of the workforce’s educational level is considered an HR advantage, and this is in line with the diversity of jobs available in an organization that is looking for various specializations (Ilmakunnas & Ilmakunnas, 2011). A study conducted by Cannatella and Hickman (2009) showed that the productivity of an individual depends on his educational level, while a study conducted by Mamman (2010) confirmed that individuals who have advanced scientific qualifications have more ability and competence to deal with an organization’s new environmental variables, compared to those who are less educated.

Methodology

For the purpose of achieving its objectives, this study relied on the methodology of descriptive research, whereby a desk survey was conducted on published literature related to the research subject. In addition, a field survey of the sample respondents was conducted by using the questionnaire developed for this purpose, to collect data that included the transformational leadership variable (as an independent variable) and the HR diversity variable (as a dependent variable). The data collected was entered into the computer and the necessary statistical analyses were performed. The study population consisted of the total number of workers in Saudi Telecom companies across various administrative and functional levels. A stratified random sample of workers in telecommunications companies from various administrative levels was used. The researcher distributed (360) questionnaires by taking a random stratified sample from the study population, from which he retrieved (355) questionnaires with a retrieval rate of (98.6%). (5) Questionnaires were excluded because they were not valid for statistical analysis, leaving us with (350) questionnaires constituting (97.2%) of the total questionnaires distributed, which is an acceptable percentage for scientific research purposes.

A questionnaire was developed for the purposes of this study to collect primary data from the study sample. This data was divided into three parts, each part containing a group of paragraphs that reflected the objectives and questions of the study, and the five-point Likert scale was used for scoring. Each answer took on relative importance, and the questionnaire consisted of the following parts:

Part One: This includes information expressing the characteristics of the study sample according to the demographic variables of gender, age, marital status, educational level, years of service, nationality, and job level.

Part Two: This contains paragraphs covering the independent study variable (transformational leadership). This variable was guided by studies of Avolio et al. (1999), Rafferty and Griffin (2004), and John (2008), and includes the following sub-dimensions: idealized influence, inspirational motivation, individualized consideration, and intellectual stimulation.

Part Three: This part includes a paragraph covering the dependent variable (HR diversity), which was guided by studying Armstrong et al. (2008), Slocum and Hellriegel (2007), Anderson and Metcalf (2003), and Technl (2011), and it includes the following sub-dimensions: gender, age, and educational level.

Cronbach’s Alpha was used as the most significant method of reliability analysis in dividing the degree of internal consistency between the contents of the scale used in the social sciences with the degree of acceptance (α ≥ 0.70) (Sekaran & Bougie, 2013). This method was applied to the HR diversity scale and the transformational leadership scale, and the results of the analysis showed that the alpha coefficient of the transformational leadership scale ranged between (80.9-88.5), while it ranged between (81.2-89.6) for the HR diversity scale, which is an indicator of a high degree of reliability, as shown in Table 1.

Table 1 Evaluate the Degree of Stability Coefficient of Internal Consistency
Questions Dimension Number of questions α
01-Apr Idealized influence 4 88.5
05-Aug Inspirational motivation 4 84.6
09-Dec Individualized consideration 4 80.9
13-16 Intellectual stimulation 4 82.8
17-21 Gender 5 89.6
22-25 Age 4 87.4
26-29 Education 4 85.1

Results and Discussion

Gender: The percentage of males reached was (63%), compared to (37%) of females, and higher number of males may be due to the fact that the nature of the work of telecommunications companies, especially in the technical and maintenance aspect, which requires field work outside offices, has a special nature that is more suited to males. This distribution of males and females is acceptable compared to previous periods, in which the participation of women in the work force in Saudi Arabia was much lower than that of males, noting that in our present time we can see clear progress in the rates of participation of women in work, as well as in various specializations and positions (Sabir & Zenaidi, 2019).

Age: The highest percentage of age distribution is concentrated in the age group of (31 years and less than 41), with a total of (37%); this indicates that the youth group is the most populous among the telecom companies in Saudi Arabia. It was followed by the age group (less than 31), at a rate of (92%), and this indicates that (66%) of the study sample are concentrated in the middle age group. The age group that followed (40 years or less than 50) constituted (20%), and the lowest percentage of respondents was for those over the age of (50 years or more) at (14%). It is noticeable that the diversity of age groups creates a competitive advantage for these companies, for example the middle age group is always more inclined to adventure, change, and openness in the field of technology and information than the elderly (Carstensen & Hartel, 2006), and this plays an important role in the development, growth and advancement of these companies and contributes to the development and excellence of their services (Mata et al., 2011). It is important not to forget the role of the older group, understanding the category of experience and the reserve of knowledge they hold, that the integration of this age group leads to benefits for the younger group from the older group, and that all of this, in the end, is in the company’s best interests.

Academic qualification: The distribution of the study sample respondents, according to academic qualification, was divided into three groups. The largest percentage, with a Bachelor’s degree, was (71%), followed by a diploma qualification at (20%), and the lowest percentage was for a postgraduate qualification, which reached (9%). The reason for the lack of higher education holders is that these company roles generally do not required high qualifications to carry out the work, except in certain fields and activities. This is especially the case since these companies focus on developing employees through training programs that are appropriate to the nature of their work.

Experience: We note that (14%) of the respondents in the study sample were in the experienced category (5 – 10 years), immediately followed by the (less than 5 years) category at (96%), meaning that (66%) of the sample study includes their experience in the category (0 – 10 years). This means that the company focuses in its appointments on new employees. This type of service company needs employees who have the ability to innovate, who are creative, who excel in customer service, and who can provide service as quickly and distinctively as possible. The third rank was for the category (at least 10 years and less than 15 years), with a percentage of (17%) and the last place came in the category (15 years or more), with a percentage of (16%), indicating that those with the most experience were 39.1%, which is a good percentage. This category of workers has sufficient experience in the field of instructions, regulations, and systems governing the work within those companies.

Human resources diversity: In order to describe the reality of practicing the dimensions of HR diversity in telecom companies in Saudi Arabia, the arithmetic averages, standard deviations, the importance of the dimension, and its reality were evaluated, as shown in Table 2.

Table 2 Means, SD for Dimensions of Human Resources Diversity
Dimensions of human resource diversity Arithmetic mean SD Level
Gender 3.33 1.4 Moderate
Age 3.06 1.39 Moderate
Educational Background 2.95 1.32 Moderate

Averages ranged from )2.95 – 3.33) with an overall average of (3.11) on the five-point Likert scale, which indicates the computations for the dimensions of HR diversity to the average level of the dimensions of HR diversity, according to the viewpoint of the study sample. “Gender” came in first place with a mathematical average of (3.33), which is higher than the general arithmetic mean (3.11), and a standard deviation of (1.40). The study believes that the respondents’ feelings and perceptions are somewhat positive towards managing the companies in question, and that they have no prejudice or discrimination on the basis of gender (male or female), which thereby requires the management of these companies to strive to include more employees, females as well as males alike, to treat everyone fairly, and to encourage employee participation in the decision-making processes. Age diversity came in second place with a mathematical average (3.06), lower than the general arithmetic average of (3.11), and with a standard deviation of (1.39). The study also believes that there is modest interest in the dimension of age diversity in HR in telecommunications companies, and that it is not sufficient to merely pay attention to this diversity, as it may create differences and competition among workers on the basis of age, each group of which considers itself the most important in the field of work. Those with experience and long service are able to practice wise management and possess the ability to overcome problems at work. As for the younger employees, and those with short and medium terms of experience see themselves as a source of innovation and creativity, most capable of meeting the renewed needs of the telecommunications market and of customers.

The “educational background” dimension ranked third and last with an arithmetic mean (2.95), which is lower than the general arithmetic mean of (3.11), and with a standard deviation of (1.32). The study finds that there is insufficient interest in diversity according to academic qualifications, and that not much is seen in this field in terms of diversity in recruitment and selection, as it would require company management to attract workers from different educational backgrounds, and to consider this a qualitative addition to the company, and to work to enhance cooperation and teamwork amongst employees of all educational levels.

Transformational leadership: The overall average perceptions of telecom workers in transformational leadership came in at a high score, with the overall arithmetic mean reaching (3.79), with a standard deviation of (1.02), where the arithmetic averages ranged between (3.70 – 3.92) on the five-point Likert scale, indicating that the level of transformational leadership in the telecom companies was high. The dimension of (individualized considerations) ranked first with an arithmetic mean of (3.92) and a standard deviation of (0.90). The researcher believes that the telecommunications companies in this study have knowledge about the importance of individual considerations, take into account the differences between workers, and work to provide requirements according to their individual needs, in addition to building confidence, and knowing the strengths and weaknesses of employees’ performance.

The dimension of (Inspirational motivation) came in second place with an arithmetic mean of (3.80) and a standard deviation of (0.95). The study indicates great knowledge and interest, on the part of the companies in the study, of the importance of motivating workers by raising their inspirational motivation and increasing optimism, enthusiasm, and interest. This can be done by giving meaning and challenge to what they are doing, giving priority to the spirit of the group, helping them focus and think optimistically about the future, and giving them the opportunity to participate in achieving common goals.

The dimension of (Intellectual stimulation) came in third place with an arithmetic mean of (3.66) and a standard deviation of (0.87). This indicates that the companies studied in this research are aware of the importance of brainstorming in the telecommunications field, which is characterized by dynamism and rapid change through ongoing employee stimulation and upgrading. For them to become more aware of this, and to encourage them to adopt and find creative solutions to the problems facing their organizations, companies must listen to their employees’ ideas, suggestions, and feelings.

The dimension of (Idealized influence) came in last place with an arithmetic mean of (3.70) and a standard deviation of (1.37). In terms of the leadership qualities of leaders, this reflects that employees consider their leaders as role models, capable of achieving the goals and objectives of the organization, and in general it appears that there is a considerable practice of transformational leadership in telecom companies in Saudi Arabia, from the viewpoint of the respondents.

The results show a statistically significant effect between transformational leadership in the studied telecommunications companies and their HR diversity; or, the dimensions of transformational leadership explain an estimated (49.5%) of the variance in HR diversity, and this means that the telecommunications companies studied in this research can benefit from HR diversity by applying a transformational leadership style focused on empowering employees, enhancing their strengths, and encouraging positive competition at work to raise the level of performance Table 3.

Table 3 MEANS, SD for the Transformational Leadership Variable
Dimension Mean SD Level
Idealized influence 3.7 1.37 High
Inspirational motivation 3.8 0.95 High
individualized considerations 3.92 0.91 High
Intellectual stimulation 3.76 0.87 High

Conclusion

It is noticeable from the results of this research that age diversity creates a competitive advantage for companies. For example, middle-aged people always have a greater preference for adventure, change, and openness in the field of technology and information, which plays an important role in the growth, development, and advancement of these companies and contributes to the excellence of their services.

The results show an overall average (3.11) of the five-point Likert scale, which represents the calculations for the dimensions of HR diversity to an average level, according to the study model.

The study believes that the respondents’ feelings and emotions in terms of company management are somewhat positive, as there is no prejudice or discrimination on the basis of gender (male or female). Women and men are treated the same, and are equally encouraged as participants in decision-making processes.

The study believes that telecommunications companies have a moderate interest in the dimension of age difference in terms of HR diversity. The companies do not pay enough attention to this diversity, which may create differences and competition among workers. Each age group considers itself the most important in the field of work.

The overall average perceptions of telecommunications workers in transformational leadership came in at a high point, with an overall arithmetic mean of (3.79) and a constant deviation of (1.02), where the arithmetic averages are between (3.70 – 3.92). The annual Likert criterion indicates that the degree of transformational leadership in the telecommunications companies in the study was high, from the participants’ perspective.

There is a statistically significant effect between the evolving leadership and HR diversity in the telecommunications companies studied. The dimensions of the evolving leadership illustrate the estimated (49.5%) variability of HR diversity. This means that the telecommunications companies studied here may be able to further diversify their human resources by using transformative leadership style to improve their strengths and focus, and promote positive competition at work to maximize performance.

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Vertovec, S. (2007). Super-diversity and its implications. Ethnic and Racial Studies, 30(6), 1024-1054.

Walker, P., & Benton, D. (2013). Best Practices In Achieving Workforce Diversity, Benchmarking Study, U.S. Department of Commerce and Vice President AL Gore’s National. Journal of Management Development, 18(3), 215 – 242.

Woods, R. (2003). Inspirational Leadership Model. New Jersey: Pearson Prentice-Hall, Inc.

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