Dynamic organisational capabilities and employee flourishing in a precarious work context : the role of authentic leadership and trust
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Many countries, such as South Africa, rely on the manufacturing industry to contribute to their economy and development. However, this industry is faced with challenges that threaten its performance and survival, forcing it to reorganise and downsize as alternatives in an attempt to find solutions that might address the situation. As with many of these initiatives, reorganisation and downsizing may have negative consequences such as job insecurity and job overload. Both outcomes hold the potential of negatively affecting the well-being of employees and the dynamic capabilities of the organisation. This thesis explored whether a positive leadership approach such as authentic leadership will promote trust, dynamic capabilities and employee flourishing within a precarious South African organisational setting. A quantitative cross-section survey design, using a self-administered structured questionnaire to collect primary data were employed. Furthermore, a stratified random sampling technique was employed to collect data from managerial level employees (n=314) functioning at the operational areas of a South African manufacturing entity going through changes to improve performance and sustainability. The self-administered structured questionnaire consisted of the following measurement instruments: the Authentic Leadership Inventory, the Workplace Trust Survey, the Job Insecurity Scale, the overload items of the Job Demands Resources Scale, the Dynamic Organisational Capabilities, and the Flourishing-at-work scale. Descriptive statistics, confirmatory factor analysis and regression analyses were calculated. Statistical analysis was performed by employing the software programs Mplus and R. Firstly, the results confirmed a model containing the proposed constructs, authentic leadership, trust in colleagues and trust in the organisation and its effect on the dynamic capabilities of a manufacturing organisation. Trust in the organisation was a stronger predictor of dynamic organisational capabilities than were authentic leadership and trust in colleagues. When leaders thus exhibit authentic leadership characteristics, they are likely to promote trust in the organisation and trust in colleagues, which may enhance the organisation’s ability to respond more effectively to challenges by sensing and seizing opportunities and reconfiguring faster after having been confronted by drastic changes or disruptions. Secondly, the results revealed that authentic leadership is associated with trust in the leader, implying that a higher level of authentic leadership might increase trust in the leaders. Although the expectation was that job insecurity would moderate the relation between authentic leadership and trust in the leader, this study established that job insecurity did not function as a moderator in this relationship. The finding thus suggests that a fluctuation in the degree of job insecurity experienced will not influence the association between authentic leadership and trust in the leader. Thirdly, the research supported a model in which authentic leadership is positively associated with flourishing through trust in the leader, suggesting that an increase in the levels of authentic leadership may cause increased employee flourishing. It was also established that the association between authentic leadership and flourishing via trust was not dependant on a moderation effect of job overload on the flourishing of employees. When employees thus trust their leaders and experience psychological, emotional and social well-being (flourishing), they are less likely to be affected negatively by job overload. Future research recommendations were also made.