IMPACT OF TRANSFORMATIONAL LEADERSHIP ON EMPLOYEES' JOB SATISFACTION AND ORGANIZATIONAL COMMITMENT

The application of transformational leadership is not a trend, hut the usual leadership approach in modern management of the most developed world economies. On the other hand, business practice shows that in Croatian companies there is considerable scope for the promotion of this advanced leadership approach. This paper therefore examines the impact of transformational leadership on employee's job satisfaction and their commitment to the organization and presents the results of a study conducted in seven Croatian companies, on a sample of 173 respondents. The research results show that greater use of transformational leadership results in a higher overall level of employees' job satisfaction as well as in a higher level of their commitment to the organization. In addition, research results confirm the relationship between leadership style and all five components of job satisfaction (satisfaction With coworkers, supervision, work, pay, and promotion), as well as between leadership style and all three components of organizational commitment (affective, continuance, and normative) that, besides scientific meaning, has also strong implications on modern management practice.