Effect Of Laissez-Faire Leadership On Organizational Performance: A Case Of PZ Cussons East Africa Limited

Leadership significantly influences the success of organizations, affecting productivity, decision-making, and employee engagement. Among the various leadership styles, laissez-faire leadership is often characterized by minimal supervision, lack of direct leadership involvement, and high employee autonomy, making its impact on organizational performance a subject of debate. This study examines the effect of laissez-faire leadership on the performance of PZ Cussons East Africa Limited, a major Fast-Moving Consumer Goods (FMCG) company in Kenya. The research employed a descriptive survey research design, targeting 84 employees through a census approach. Data was collected using semi-structured questionnaires and analyzed using descriptive and inferential statistics, including correlation and regression analysis. The findings reveal that laissez-faire leadership has a statistically significant negative impact on organizational performance. Correlation analysis showed a moderate negative relationship between laissez-faire leadership and performance (r = -0.52, p < 0.05), while regression analysis indicated that laissez-faire leadership explains 27% of the variance in organizational performance (R² = 0.27, p < 0.05). Employees reported poor role clarity, reduced accountability, and inefficiencies in decision-making under laissez-faire leadership. The study concludes that while autonomy is beneficial in some contexts, excessive leader inaction results in organizational inefficiencies. The study recommends that PZ Cussons adopt a hybrid leadership model that integrates structured oversight with employee autonomy. Additionally, leadership training programs and accountability frameworks should be introduced to mitigate the negative effects of laissez-faire leadership and enhance organizational performance.