Effect of Transformational Leadership on Organizational Performance: Case of The National Council of Churches of Kenya

Abstract

This study investigated the effect of transformational leadership on organizational performance, using the National Council of Churches of Kenya (NCCK) as the case organization. The research was prompted by increasing organizational underperformance, stagnation, and closure in Kenya over the past seven years, trends that have also affected faith-based organizations. Guided by Transformational Leadership Theory, the study examined four constructs- idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration- as independent variables. Organizational performance was assessed through service delivery, human resource development, employee motivation, and achievement of strategic goals. The Resource-Based Theory complemented the study by emphasizing the strategic role of internal human capital in enhancing competitive advantage. A mixed-methods approach and cross-sectional descriptive design were used to collect data from senior and lower-level NCCK managers through a semi-structured questionnaire incorporating a five-point Likert scale. The conceptual framework illustrated the relationship between transformational leadership and organizational performance, while the empirical review drew from global, continental, regional, and Kenyan FBO contexts. Findings revealed that transformational leadership significantly improves organizational performance by strengthening motivation, enhancing human resource capacity, improving service delivery, and aligning organizational culture with long-term strategic priorities. The study contributes to leadership scholarship and offers practical insights for faith-based institutions seeking to strengthen leadership capacity, foster innovation, and cultivate continuous learning. Overall, the study affirms transformational leadership as a critical driver of organizational performance and a strategic pathway for revitalizing FBOs in Kenya.