IMPACT OF LEADERSHIP STYLES ON THE PERFORMANCE OF VIRTUAL TEAMS IN THE UAE GOVERNMENT SECTOR: ASSESSMENT OF TRANSACTIONAL AND TRANSFORMATIONAL LEADERSHIP STYLES

The widespread availability of computers and the presence of ubiquitous internet has motivated organizations to acknowledge the potential role of virtual teams in reducing the cost of operations, increasing firm productivity, and creating flexible work environments. Consequently, most global firms are running their operations using multiple experts located remotely in different parts of the world (virtual teams) to plan, design, and implement projects and tasks. However, virtual teams face many challenges resulting from a lack of face-to-face contact. Based on existing relevant literature, this study contributes a unique insight into how some challenges surrounding virtual team performance might be addressed. Specifically, this thesis investigates the effect of transformational and transactional leadership styles on the virtual teams’ performance in the UAE Government sector. In addition, it also examines the interactive effect of key virtual team contextual factors such as cohesion, trust, creativity, and team empowerment. Research hypotheses were tested using the quantitative research method, wherein data was collected from a sample of 344 participants followed by analyses. The obtained findings indicate that both transformational and transactional leadership styles had significant effects on virtual team performance, with transformational style having a stronger impact. As regards moderator effects, team cohesiveness and team creativity significantly affected the impact of leadership style on virtual team performance. Team empowerment was only significant for transformational leadership, but surprisingly team trust was not significant for both forms of leadership styles. To sum up, these findings were largely in line with the results of prior studies in that both transactional and transformational styles were best suited to organizations for improving the performance of their virtual teams. However, the transformational style worked better in an organizational environment of higher team empowerment than the transactional style. This thesis recommends that further studies investigate other internal and external factors of virtual team performance to gain more insights into the various sets of factors shaping the commitments of virtual teams to work performance