Influence of Staff Satisfaction as a Transformational Leadership outcome on the Performance of Microfinance Institutions’ Staff in Kenya

Transformational leadership has been related to several outcomes in staff. Transformational leadership outcomes reinforce the desire for staff to continue working in an organization as well as their willingness to be innovative which leads to the company gaining a competitive edge over the peers in a sector. Whilst microfinance has been accepted across the globe as a forum within which poverty can be eradicated and financial inclusion extended, various challenges define microfinance today and present a leadership challenge that needs to be tackled for the sector to improve and deliver its mandate. The study determine the influence staff satisfaction had on performance of microfinance institutions’ staff in Kenya. The research employed descriptive research design.  The target population was 250 senior managers, 700 middle level managers and 4948 other microfinance staff of 37 microfinance institutions. Primary data was gathered from the respondents whereas secondary data was gotten from AMFI on performance of institutions. Stratified sampling technique was used to obtain sample and sample size determined using the Cochran’s formula to be 385 which was large enough to allow generalization. Data analysis was done using SPSS. A simple linear regression model that reflects relationship between staff satisfaction and performance was estimated. Findings revealed that staff satisfaction had a positive and significant relationship with staff performance in microfinance institutions. The study concluded that staff satisfaction as an outcome of transformational leadership had a positive and significant relationship to staff performance in micro-finance institutions in Kenya. Keywords: Transformation Leadership, Staff Satisfaction, Performance & Microfinance Institution.