Influence of Transformational Leadership Practices on Channel Performance of MLM Sales Leaders in Malaysia

Abstract

One of the most important resources in organizations is the mentors who have important role in today's corporate setting (Brashear, Bellenger, Boles, & Barksdale, 2006). In Multi-Level Marketing (MLM) business context, mentors' roles are similarly MLM sales leaders' functions who able to increase earning potential and decrease the rate of downlines' intention to leave. In addition, due to more downlines retire early after successfully achieving financial freedom, MLM sales leaders could keep valuable knowledge within Multi-Level Marketing Organizations (MLMO) and provide a competitive edge for recruiting purposes (Marchetti, 2005). The main objective of the study was to analyze the influence of transformational leadership practices on channel performance of selected MLMO in Malaysia. The study adopted leadership theories, especially transformational leadership as the main theories and models of the study. In this study, cluster sampling was used in selecting 64 MLMO as the sample from the registered list of Direct Selling Association of Malaysia (DSAM). There were 320 sets of structured questionnaires distributed to the selected downlines for collecting inputs and the data was analyzed through the help of Statistical Package for Social Science (SPSS). The study revealed the significance of transformational leadership practices on channel performance of MLM sales leaders in Malaysia.