THE IMPACT OF PEOPLE-ORIENTED LEADERSHIP BEHAVIOR ON EMPLOYEE SATISFACTION IN SMALL AND MEDIUM ENTERPRISES IN VIETNAM

Leadership behavior is one of the factors constituting a leader's capacity. Leaders need to have effective leadership behaviors to lead, empower, inspire, help employees develop and elevate themselves, as well as improve employee satisfaction with the organization. The necessary conditions of leadership competence covers Leadership quality, knowledge and application of leadership skills. The sufficient conditions require leadership behaviors based on those quality and knowledge. In order to become excellent leaders, besides qualities and knowledge, they should have effective leadership behaviors to employees develop themselves and create employee satisfaction with organizations. The more satisfied employees are, the better their working performance and the lower their absence as well as job change will be. Then, organizations and businesses will achieve their expectations of business performance. This study aimed at testing the impact of leadership behavior on employee satisfaction in Vietnamese small and medium enterprises. Based on the survey sample of 491 questionnaires for employees in small and medium enterprises, the results of quantitative research demonstrated that people-oriented leadership behavior put a positive impact on employee satisfaction in small and medium enterprises, including engagement, conciliation, patience, and persuasion. As a result, the study provided recommendations to develop leadership behaviors, which would bring about a good influence on employee satisfaction.