Antecedents of employee performance: an empirical investigation in India

Purpose - The purpose of this paper is to examine the relationship between psychological climate, and transformational leadership, with employee performance. The paper builds on relevant research in this area, and extends such research to the Indian context. Design/methodology/approach - Data were gathered from 357 participants in Indian organizations, who responded to questions regarding their work environment and perceived supervisory support. The respondents' demographic data were treated as control variables. Findings - As predicted, it was found that organizational psychological climate, and transformational leadership, predicted job satisfaction. Job satisfaction, in turn, predicted employee performance, a composite measure of in-role and extra-role performance. Research limitations/implications - All data were collected from the participants at one point of time - as such, causality cannot be inferred, and the results may be subject to common method bias. Practical implications - From a practical perspective, the results emphasize the need for organizations to create a positive climate, where employees can feel valued. Next, the results suggest the need for managers to adopt a transformational style of leadership over the transactional style, so that employees may learn and grow with the organization. Together, these shall result in increased employee satisfaction which shall ultimately lead to higher levels of employee performance. Originality/value - While there are numerous theoretical pieces exploring the antecedents of employees' performance, the number of empirical studies relating cross-level variables using structural equation modeling is limited. Moreover, this is the first known study to examine the variables in the Indian context, which continues to gain importance on the world economic scene.