Impact of Democratic Leadership on Employee Productivity in the Banks of Bharatpur

Abstract

Democratic leadership, defined by participative decision-making and employee involvement which plays a critical role in shaping employee satisfaction and driving employee productivity. This leadership style emphasises collaboration, where employees are actively engaged in organisational decisions, yet leaders retain the authority to make final decisions fostering a balanced and inclusive work culture. Despite increased recognition of employee rights, many organisations still struggle to implement democratic leadership practices that effectively empower their staff. This study addressed the empirical gap by investigating the effects of democratic leadership on employee satisfaction and employee productivity within commercial banks in Bharatpur, Chitwan. 
The cross-sectional survey research design was adopted, using primary data from one hundred and five (n = 105) employees via questionnaire. The data were analysed using SPSS, applying correlation and binary logistic regression to examine relationships between democratic leadership and employee satisfaction. Correlation analysis shows a moderate association between employee involvement and decision-making, while binary logistic regression results indicate that democratic leadership factors account for a meaningful portion of variance in employee productivity. Findings confirm that democratic leadership positively impacts both employee satisfaction and employee productivity.

By focusing on employee satisfaction under democratic leadership, particularly in the banking sector, this research contributes knowledge specific on democratic leadership which is useful for practitioners, policymakers, and future scholars.