Journal of Economics and Trade

The emergence of various leadership styles has implications on the overall productivity of an organization. In view of the foregoing, this study explores the effect of leadership style on employee performance of brewery firms in South-East Nigeria, focusing on the effects of transformational and transactional leadership on employee productivity and job satisfaction respectively. Transformational Leadership Theory, developed by James MacGregor and later expanded by Bernard formed the basis of this work. The theory posits that effective leaders inspire followers to transcend their self-interest for the good of the organization, fostering motivation, trust, and commitment. Using a descriptive survey design, sample size of 303 was determined from a population of 1250 using Taro Yamane formula (1967). The study employed simple regression analysis to test the formulated hypotheses. Findings reveal that transformational leadership has a significant and positive influence on employee productivity (β = 0.73; R² = 0.55, p < 0.001), while transactional leadership has a moderate but significant effect on job satisfaction (β = 0.58; R² = 0.28, p < 0.001). The results confirm that transformational leadership produces higher levels of intrinsic motivation, creativity, innovation and goal attainment compared to transactional leadership, which is basically compliance-oriented. The study concludes that transformational leadership should be prioritized in the Nigerian brewery sector to enhance implicit confidence, sustainable performance and employee engagement.