“You have to act as a labour union for the employees” : A qualitative study into preferred style of leadership and job satisfaction in Finland and Estonia

Abstract

This qualitative study, conducted as semi-structured interviews, studies the preferred style of leadership and its implications to employee job satisfaction. The study addresses three main research questions. The first one is: what are the characteristics that make a leader effective in the eyes of an employee. This question is covered by the theory of B.M. Bass that considers the distinction between transformational and transactional styles of leadership. The second research question is: how are leadership style and job satisfaction connected. Here the motivator-hygiene theory of Herzberg is used as a basis for analysis. The third question to be considered is whether there are differences between employee attitudes in Finland and Estonia. The aim of the study is to provide indications about employee preferences for the businesses that operate in Finland and Estonia. The study encourages businesses to consider how a culturally sensitive leader operates in those countries. The study was conducted among a total of six employees from Finland and Estonia. The results indicate that transformational style of leadership, enabling employee participation and development, is rather preferred among the interviewees. Additionally, openness in communication and people skills are considered important characteristics of a leader. All the same factors also improve employee job satisfaction, whereas micromanaging and poor company policies decrease satisfaction towards work. There are slight differences between employees in Finland and Estonia in how important they consider the role of salary and other material compensation, for their motivation. Further research on topic is needed and it is recommended to use mixed method. No generalised conclusions are presented based on this thesis, but rather indications for future research topics.