Culturally Attuned Leadership and Employee Behavior During Organizational Change Initiatives in a Developing Economy

Abstract

In an era of rapid market shifts and technological disruption, the success of organizational change rests on the ability of leaders to navigate complex cultural dynamics. This study explores how culturally adaptive leadership can drive employee outcomes in Sierra Leone’s commercial banking sector during periods of change. By integrating transformational and transactional leadership styles with Hofstede’s cultural dimensions theory, which focuses on power distance (respect for authority) and uncertainty avoidance (preference for structure), this research examines how these cultural values influence the relationship between leadership approaches and employee outcomes. Using a cross-sectional design, data were collected from 820 employees across commercial banks in Sierra Leone, with data analyzed using structural equation modeling (SEM). The findings reveal that transformational leadership significantly enhances employee outcomes, specifically in high power distance environments where authority is deeply respected, while transactional leadership proves more effective in high uncertainty avoidance settings, where clear structure and predictability are paramount. The study highlights the complementary nature of these leadership styles, suggesting that effective leaders must adapt their strategies to the cultural context to drive performance. While the cross-sectional design limits causal inference, this research underscores the critical importance of culturally adaptive leadership, recognizing how cultural dimensions shape behavior and promote sustained success during change.