Transformational leadership and organizational learning culture in the health sector: The mediating and moderating role of intrinsic work motivation

Abstract

BACKGROUND:

Transformational leadership and organizational learning culture have become exciting topics to be explored over the last few decades. However, several previous studies have shown certain inconclusive findings regarding the link between transformational leadership and organizational learning culture.

OBJECTIVE:

This study fills this gap by developing a clear model and aims to examine the extent of the impact of (1) transformational leadership on organizational learning culture and intrinsic work motivation, (2) intrinsic work motivation on organizational learning culture, (3) intrinsic work motivation in mediating and moderating the relationship between transformational leadership and organizational learning culture.

METHODS:

The data of this study are collected from employees working at the community health center in Indonesia. A partial least squares (PLS) based structural equation modeling (SEM) technique is used to analyze the data by utilizing the SmartPLS 3.0 software package.

RESULTS:

First, the results concluded that transformational leadership has a significant impact on organizational learning culture and intrinsic work motivation. Second, intrinsic work motivation has a significant impact on organizational learning culture. Third, intrinsic work motivation fully mediates the relationship between transformational leadership and organizational learning culture. Also, intrinsic work motivation moderates these variables’ relationships.

CONCLUSION:

The theoretical model of previous research on the relationship between transformational leadership and organizational learning culture with intrinsic work motivation as a mediator and moderator variable has yet to be fully developed both in public and private organizations, particularly in the health sector.

Keywords

Transformational leadership employee community health center PLS-SEM

1 Introduction

Business organizations in the modern era are becoming increasingly complex, uncertain, full of challenges and turbulence, and very competitive. Therefore, organizations need leaders who are able to manage various existing changes to improve the expected achievements and performance at this time and in the future [1 –4]. According to Kim et al. [5], servant and authentic leadership are required to be able to adapt to rapidly changing business environments and effectively manage organizations. In addition, Zhang et al. [6] proposed inclusive and empowering leadership to enhance employees’ innovation capacity. However, many researchers and organizational practitioners recommend the transformational leadership style as the main alternative for managing modern organizations [7 –9]. Transformational leaders are able to change employees’ views of change to see it as an attractive opportunity rather than a threat. Transformational leaders stimulate employees to seek new resources and challenges to increase adaptability within the organization [10].

Transformational leadership and organizational learning culture are closely related to welcoming the survival and excellence of the organization. Moreover, several previous studies have also shown that there is a link between transformational leadership and organizational learning culture [11, 12], which leads to the achievement of organizational excellence. Transformational leadership encourages an adaptive learning culture within the organization to achieve sustainable organizational excellence. However, only a few studies have examined the relationship between transformational leadership and organizational learning culture through the role of a mediator or moderator variable. Phipps et al. [13] offer a clear proposition about the effect of the interaction between transformational leadership and organizational learning culture on employee creativity. Furthermore, the findings of Khan et al. [11] show that organizational learning culture has yet to be able to moderate the relationship between overall transformational leadership and employee job satisfaction. This study, hence, offers intrinsic work motivation as a mediator and moderator between transformational leadership and organizational learning culture. Concerning the self-determination theory (SDT) by Deci and Ryan [14], intrinsically motivated employees put out a tremendous effort to learn well, adapt quickly to changes in the work environment and pursue future goals when they get a stimulus as well as inspiration from transformational leadership.

This study seeks to address gaps in previous research by examining the role of intrinsic work motivation in mediating and moderating the effect of transformational leadership on organizational learning culture. Therefore, the main objective of this study is to examine the extent of the influence of (1) transformational leadership on organizational learning culture and intrinsic work motivation, (2) intrinsic work motivation on organizational learning culture, (3) intrinsic work motivation in mediating and moderating the relationship between transformational leadership and organizational learning culture.

2 Literature review and hypothesis developments

2.1 Organizational learning culture

Organizational learning is a complex set of learning processes that focus on developing new knowledge that has the potential to change employee behavior [15]. Organizations that have formed a strong learning culture in acquiring knowledge and information, developing and modifying it into valuable knowledge and information can increase the organization’s adaptability and long-term advantage [16].

Nonaka and Toyama [17] note that effective organizational learning requires a supportive culture and infrastructure that encourages the creation and transfer of knowledge within and outside the organization. Therefore, there needs to be a genuine effort to value learning, shared vision, and use of knowledge management systems to capture, store, and disseminate existing knowledge. Argyris and Schön [18] propose two types of learning (i.e., single-loop and double-loop learning) that should be implemented in organizations to acquire and apply knowledge to achieve their goals and performance. Single-loop learning involves setting up simple learning practices to improve performance, while double-loop learning involves challenging assumptions and values to create significant changes in organizational practices.

Organizational learning culture is a series of learning activities that become a habit and are integrated into all organizational functions [19]. Learning culture often starts with the individual personally and ends with the whole organization, which is formed through an excellent organizational structure [20]. Organizational learning culture facilitates individual, teamwork, and collaboration to reflect on adaptive and sustainable learning. A learning culture helps organizations gain, maintain and enhance a sustainable competitive advantage, which in turn has an impact on the overall performance of the organization [21].

Building a learning culture in organizations is indeed very important to increase organizational value in a competitive market [22], and an organizational culture that values learning can be the key to continuous improvement of work quality [23]. Organizations that foster a learning culture cause employees to be interested in learning more intensely and continuously, as well as apply what they have learned to improve the performance of individuals, units and the organization as a whole. The learning culture in the organization increases knowledge and skills and minimizes various obstacles encountered in the workplace [24]. Therefore, organizational learning culture must be a day-to-day activity and binding rules, not an exception.

Organizational learning culture has a powerful contribution to organizational performance [25, 26]. Through organizational learning, employees are more motivated and enthusiastic about learning the rules, norms and values of the organization as well as aligning their behavior to the desired level to achieve higher work productivity. In several previous studies, organizational learning culture is strongly influenced several factors, such as transformational leadership [11, 27], empowering leadership [28], job satisfaction and organizational commitment [29], and is strengthened by intrinsic work motivation [30, 31].

2.2 Intrinsic work motivation

Intrinsic work motivation is a psychological mechanism in which individuals perform an activity to obtain the satisfaction and pleasure inherent in the activity [14]. When employees are intrinsically motivated, they are moved to carry out certain activities to completion because of their inherent pleasure, happiness and satisfaction or challenges, and not because of external rewards or pressures [32]. In the insight of Locke and Schattke [33], employees with intrinsic work motivation lead to high work creativity because they enjoy doing work to produce better performance than others. Intrinsically motivated employees come up with valuable and unique ideas to meet the demands of the job [34].

Employees with intrinsic work motivation are all the potential to contribute to the organization. They enjoy doing their best for the success of the organization and helping others without expecting anything in return. Intrinsically motivated employees tend to be willing to take risks, have high curiosity, and are persistent in facing various obstacles and challenges [35].

2.3 Transformational leadership

Transformational leadership is a leadership style in which the leader influences and significantly changes employees’ attitudes, behaviors, beliefs, and values to focus on achieving common goals by displaying high performance [36, 37]. Bass and Avolio [38] confidently describe transformational leadership as a leadership style that is able to inspire, encourage, direct, and engage employees in practicing diverse tactics to achieve common goals by taking into account their needs, qualities and capacities.

The transformational leadership concept, according to Bass and Avolio [38], covers four key components: (1) Idealized influence: leaders set an example by behaving ethically to influence their employees; (2) Inspirational motivation: leaders use and articulate compelling visions to inspire employees to work toward shared goals; (3) Intellectual stimulation: leaders encourage employees to think creatively and find better ways of doing work; and (4) Individualized consideration: leaders treat employees well and provide clear support to help them grow and actualize their potential. Transformational leadership comprehensively explains the future’s vision and describes the right strategy to achieve it. Transformational leadership provides assurance that the vision can be achieved properly when employees invest all the time, energy and thought to move towards the desired vision and goals without neglecting their own interests for the success of the organization [39 –41].

Transformational leadership, according to Paarlberg and Lavigna [42], is generally centered on a strong emphasis on achieving a collective vision, which includes a set of ideal goals that the organization wants to achieve in the future. Transformational leadership includes four components that distinguish it from other leadership styles: idealized influence (i.e., the leader functions as an ethical role model by communicating an attractive vision of the future to arouse positive emotions in employees to achieve it), intellectual stimulation (i.e., leader increases employees’ awareness of the ideal goals to be achieved by challenging them to be more innovative and creative in realizing higher performance), inspirational motivation (i.e., the leader encourages employees to prioritize larger collective goals beyond their own self-interest), and individualized consideration (i.e., leader genuinely cares about employees’ needs and feelings when they are self-actualizing in their jobs and organizations) [36 , 44].

Transformational leadership is considered very important in facilitating and increasing the continuity of learning in organizations. Previous findings show that transformational leadership has a positive relationship with organizational learning culture [45, 46]. Transformational leadership articulates a clear vision of the future and builds a supportive learning environment by cultivating shared values that are in line with the achievement of collective goals within the organization [10, 47]. In addition, transformational leaders share ideas and opinions with employees so that they are able to move to a higher level of work motivation [45]. Minh-Duc and Huu-Lam [48], Nguyen et al. [49] found that transformational leadership has a significant influence on increasing employee intrinsic work motivation in realizing innovation and creativity at workplace. Thus,

H1: Transformational leadership has a positive and significant impact on organizational learning culture.

H2: Transformational leadership has a positive and significant impact on intrinsic work motivation.

Intrinsic work motivation internally encourages employees to perform better in the environment and workplace without expecting external rewards. Intrinsic motivation plays a vital role in influencing organizational learning culture so that employees feel satisfaction when learning to increase positive values and behaviors that contribute to work [29]. Intrinsic work motivation increases the ability and attention of employees to learn continuously. Employees who are intrinsically motivated when learning tend to have a higher pleasure and resilience to be in the organization to achieve positive results compared to those who are not motivated [50]. Joo and Lim [51] asserted that employee motivation and organizational learning are positively related, where motivated employees have adequate organizational learning capacity that serves as an essential capital to create an excellent and competitive organization. Thus,

H3: Intrinsic work motivation has a positive and significant impact on organizational learning culture.

Intrinsic work motivation in public services is the basis that encourages altruism, cooperative behavior and mutual assistance in organizations [52], which in turn, inspires employees to interact with each other, collaborate by sharing various knowledge and information as well as being motivated to provide benefits to the others [53]. Transformational leadership fully provides high support for improving learning and developing employee competencies so that they are able to contribute new ideas and disseminate valuable knowledge within the organization [54] to achieve sustainable competitive advantage. Transformational leadership inspires and encourages employees to promote unique knowledge and learning so that they can become innovative people in solving problems [55]. In addition, transformational leadership increases employees’ awareness to achieve collective interests within the organization by encouraging them to collectively carry out adaptive learning in utilizing technology and designing as well as producing new technologies that are beneficial for organizational growth [56]. Thus,

H4: Intrinsic work motivation significantly mediates the impact of transformational leadership on organizational learning culture.

Intrinsically motivated employees are more likely to engage in tasks willingly and find a sense of fulfillment in doing so. In this context, transformational leaders play a critical role in fostering intrinsic work motivation among employees [57]. By offering intellectual challenges and providing inspiration, transformational leaders can help increase employees’ internal motivation to learn and grow. These employees are likely to be proactive in seeking out opportunities for learning and growth, and they may contribute actively to shaping the organizational learning culture [45, 46]. Thus,

H5: Intrinsic work motivation significantly moderates the impact of transformational leadership on organizational learning culture.

3 Methods

The samples of this study were obtained in Riau island –Indonesia and collected from permanent employees working in community health centers. Using purposive sampling, 70 questionnaires are administered to respondents. The data are collected using a self-administered questionnaire survey and accomplished for three months, from April to June 2022. Of the 70 employee questionnaires shared, 64 were returned and fully deserved to be analyzed (a response rate of 91.4%). This sample is acceptable for structural equation modeling (SEM) using smartPLS because the minimum sample size is 10 x number of arrows pointing to the endogenous construct [58]. In addition, according to Willaby, Costa [59], Hair et al. [60], PLS-SEM becomes the best solution for small sample sizes in the investigated model, which consists of a large number of items and numerous constructs. About 50% of the respondents are male, and 45.3% have undergraduate education qualifications. The average age is between 26–30 years old (40.6%), and 44.4% of the respondents have worked in the ‘current’ organization for 1 to 3 years.

Transformational leadership is measured with seven items developed by Kirkman et al. [61], Astuty and Udin [62] (e.g., leader clearly defines organizational vision and mission). Organizational learning culture is measured with seven items developed by Naqshbandi and Tabche [28], Lin and Huang [63] (e.g., employees are highly valued when they learn in the organization). Intrinsic work motivation was measured with four items developed by Tremblay et al. [64], Çetin and Aşkun [65] (e.g., when learning new things in their job, employees get much fun). A five-point Likert scale with answers ranging from 1 (never) to 5 (always) is used to assess respondents’ responses to these items.

4 Results and discussion

A partial least squares (PLS) based structural equation modeling (SEM) technique is used to analyze the data by utilizing the SmartPLS 3.0 software package. According to Hair and Sarstedt [66], PLS-SEM is an easy, solution-based and beneficial approach for testing hypotheses and developing theories. PLS-SEM makes easier for researchers to create and estimate structural equation model to obtain interpretive solutions and document research results.

Table 1 shows that the factor loading values (i.e., between 0.557 and 0.825), Cronbach’s α (i.e., between 0.683 and 0.851), rho_A (i.e., between 0.703 and 0.866), and composite reliability (CR) (i.e., between 0.809 and 0.888), indicating internal consistency/reliability. A construct is able to explain more than half of the variation of the former indicators if the AVE value is 0.5 or more. The results show that all the values of the AVE constructs are higher than the recommended threshold except for the organizational learning culture variable, which is 0.409. However, convergent validity is still eligible if the AVE value is less than 0.5 and the composite reliability is greater than 0.6 [67].

Table 1
Convergent validity and reliability

Variables Items Loadings Cronbach’s α rho_A CR AVE

Transformational TL1 0.570 0.851 0.866 0.888 0.535

Leadership TL2 0.745

TL3 0.825

TL4 0.705

TL5 0.797

TL6 0.818

TL7 0.618

Intrinsic work motivation IWM1 0.574 0.683 0.703 0.809 0.519

IWM2 0.701

IWM3 0.759

IWM4 0.824

Organizational learning culture OLC1 0.557 0.757 0.755 0.828 0.409

OLC2 0.595

OLC3 0.679

OLC4 0.696

OLC5 0.725

OLC6 0.624

OLC7 0.582

Variables	Items	Loadings	Cronbach’s α	rho_A	CR	AVE
Transformational	TL1	0.570	0.851	0.866	0.888	0.535
Leadership	TL2	0.745
	TL3	0.825
	TL4	0.705
	TL5	0.797
	TL6	0.818
	TL7	0.618
Intrinsic work motivation	IWM1	0.574	0.683	0.703	0.809	0.519
	IWM2	0.701
	IWM3	0.759
	IWM4	0.824
Organizational learning culture	OLC1	0.557	0.757	0.755	0.828	0.409
	OLC2	0.595
	OLC3	0.679
	OLC4	0.696
	OLC5	0.725
	OLC6	0.624
	OLC7	0.582

Table 2 presents the results of Fornell and Larker criterion to determine the discriminant of the construct’s validity. The CR value is between 0.809 and 0.888, and AVE is between 0.409 and 0.535. When the AVE is higher than the squared latent variable correlations, the discriminant validity is considered to be confirmed [68].

Table 2

Fornell–Lacker criterion discriminant validity

Variables	CR	AVE	IWM	OLC	TL
Intrinsic Work	0.809	0.519	0.720
Motivation (IWM)
Organizational Learning	0.828	0.409	0.778	0.640
Culture (OLC)
Transformational	0.888	0.535	0.610	0.790	0.731
Leadership (TL

Figure 1 and Table 3 show the values and the statistical significance of the path coefficients that transformational leadership has a significant positive impact on organizational learning culture (β= 0.516, t = 5.893; p < 0.05) and intrinsic work motivation (β= 0.610, t = 6.694; p < 0.05), hence supporting H1 and H2. In addition, intrinsic work motivation has a significant positive impact on organizational learning culture (β= 0.448, t = 4.249; p < 0.05), confirming H3.

Fig. 1

Structural model assessment.

Table 3

Path coefficients for the relationships

Hypothesis	Relations	β	S.D	T-values	P-values	Remarks
Direct Effect
H1	TL → OLC	0.516	0.088	5.893	0.000	Supported
H2	TL → IWM	0.610	0.091	6.694	0.000	Supported
H3	IWM → OLC	0.448	0.105	4.249	0.000	Supported
Mediating Effect
H4	TL → IWM → OLC	0.273	0.068	4.041	0.000	Supported
Moderating Effect
H5	TL ^* IWM → OLC	0.113	0.052	2.190	0.031	Supported

Note: TL (Transformational Leadership), IWM (Intrinsic Work Motivation), OLC (Organizational Learning Culture).

To analyze the mediating and moderating effect of intrinsic work motivation on the relationship between transformational leadership and organizational learning culture (H4 and H5), the results in Table 3 indicate that transformational leadership has a significant positive impact on organizational learning culture via intrinsic work motivation (β= 0.273, t = 4.041; p < 0.05). Also, intrinsic work motivation has a strong connection with transformational leadership to influence organizational learning culture (β= 0.113, t = 2.190; p < 0.05), which leads to support H4 and H5.

This study found that transformational leadership inspires and motivates employees to learn continuously to achieve higher outcomes beyond their expectations. Transformational leaders enhance employees’ creative thinking by convincing, trusting and supporting their goals in achieving higher work functions. Transformational leaders create dramatic and meaningful change for employees at the individual, team and organizational levels by using a long-term perspective [69] and systematic organizational support that leads to higher levels of work performance [70, 71]. Transformational leaders greatly empower employees, stimulate their intellectual potential and dare to activate their critical minds to actively set higher life goals. Therefore, transformational leaders create an open, comfortable, trusting and innovative organizational atmosphere to stimulate awareness of employee initiatives in internalizing organizational goals, which in turn, generate optimistic attitudes and behaviors that are beneficial to the organization [72 –74].

Transformational leadership creates a good working climate and conditions for employees to increase and strengthen their work motivation, effectively increasing their independence in innovative thinking and taking higher initiatives for work success. Effective transformational leadership can stimulate employees to show positive attitudes and behaviors in the organization and ensure that their innovative ideas and creativity align with organizational goals. In other words, transformational leadership helps employees to fulfill psychological needs (i.e., autonomy, competence, and relatedness) to increase intrinsic work motivation [75].

Intrinsic work motivation in this study is able to improve organizational learning culture. Intrinsic work motivation internally encourages and empowers employees to show pleasant behavior in terms of completing tasks and working at work in intensity and long duration. The strength of this internal drive leads employees to learn continuously in order to achieve specific results and the expected needs. When employees are intrinsically motivated, they have a strong sense of responsibility towards their work, are more likely to feel satisfied with their job and fully engaged in their work, and produce high-quality work that exceeds expectations to fulfill personal growth and development. Many studies have found that intrinsic work motivation promotes positive work outcomes, such as stimulating work creativity and increasing performance and organizational commitment [76]. Intrinsically motivated employees devote more time, energy and thought to work success because they are able to find happiness and meaning in the work itself; for instance, work as worship, which in turn, they actively improve ideas that constructive, deep knowledge and insight about job improvement [77] and more willing to show high pro-active behavior for the benefit of individuals, teams and organizations as a whole.

5 Conclusion

Transformational leadership, in various works of literature, plays an essential role in promoting positive behaviors and attitudes of employees in the organization. Therefore, the findings of this study conclude, first, that transformational leadership significantly impacts organizational learning culture and intrinsic work motivation. Second, intrinsic work motivation has a significant impact on organizational learning culture. Third, intrinsic work motivation fully mediates the relationship between transformational leadership and organizational learning culture. Also, intrinsic work motivation moderates these variables’ relationships.

This research offers clear implications both theoretically and practically. First, this study theoretically expands and enriches the literature on the relationship between transformational leadership and organizational learning culture by emphasizing intrinsic work motivation as a mediator and moderator variable. Transformational leadership can stimulate and facilitate continuous learning in organizations by emphasizing the search for meaning in work and designing tasks aligned with individual interests [78, 79]. When employees are able to make sense of their work and presence in the organization, they become intrinsically motivated to show attitudes and behaviors that are beneficial for their career success, such as continuous learning and fostering high initiative in the organization. Second, practically this research emphasizes the importance of the transformational leadership style in realizing organizational success and effectiveness. Transformational leadership, on the one hand, tries its best to actively inspire employees [80], appears as a role model that is admired and continuously improves employees’ ability to think critically out of the box. On the other hand, transformational leadership constantly reassures and strengthens employees’ understanding of values and a synergistic vision of the future to be achieved in different situations.

This study has limitations that need to be explained explicitly. First, in terms of methodology, this study uses self-evaluated employees regardless of their leader’s responses. This is likely to cause bias, and severe general method bias can attenuate the influence of the moderating variable [81]. However, the results of the test of the effect of the moderating variable in this study showed significant findings, indicating that the general method bias could have been more influential. Therefore, for future studies, it is necessary to match the responses of employees and leaders in responding to each item of the questionnaire to reduce the bias of the general method. Second, the sample involved in this study is more focused on employees working in community health centers in Riau island –Indonesia, so the generalization of the findings seems challenging to extend to other organizations and sectors, such as hospitality, tourism, and education. Therefore, future research needs to collect and verify data from different working groups and different types of organizations to find more comprehensive conclusions. Third, the data in this study were obtained using a cross-sectional study, so it could not examine causal relationships. Therefore, future studies need to use longitudinal to collect data and explore causal relationships in the model under study.

Ethical approval

Not applicable.

Informed consent

Not applicable.

Conflict of interest

The author declares no conflict of interest concerning the research and publication of this article.

Footnotes

Acknowledgments

None to report.

Funding

This research was funded by the Research and Innovation Institute of Universitas Muhammadiyah Yogyakarta (grant 56/R-LRI/XII/2022).

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