The Impact of Transformational Leadership on Employee Engagement in the Post-Merger and Acquisition Phase: An Empirical Study on the Business Process Outsourcing (BPO) Sector

Abstract Purpose: This study explores the impact of the four elements of transformational leadership—idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration—on the three facets of employee engagement—cognitive, emotional, and physical—among middle managers and non-managerial employees in Business Process Outsourcing (BPO) and Customer Experience (CX) organizations in Egypt that have experienced mergers or acquisitions. Design/methodology/approach: A structured questionnaire was used in a quantitative, cross-sectional study design. Transformational leadership was assessed through the dimensions of the Multifactor Leadership Questionnaire, while employee engagement was measured using Kahn's cognitive, emotional, and physical dimensions on a five-point Likert scale. The study collected 143 valid responses from full-time, middle managers and non-managerial BPO/CX employees with direct experience of mergers or acquisitions. Data were analyzed using IBM SPSS, including descriptive statistics, Cronbach's alpha for reliability, Spearman's rank-order correlation, and simple linear regression to test twelve hypothesized relationships. Findings: All twelve hypothesized relationships were statistically significant and positive (p < .001). Emotional engagement showed the strongest association with transformational leadership. Idealized influence had the most powerful link with emotional engagement (β = .470, R² = .221), followed by intellectual stimulation (β = .444, R² = .197), individualized consideration (β = .431, R² = .186), and idealized influence (β = .426, R² = .182). Cognitive engagement exhibited the weakest, yet still significant, relationships with all four leadership dimensions. Originality/value: This research advances the understanding of transformational leadership and employee engagement by evaluating both constructs at the dimension level instead of treating them as composite variables. It uniquely situates the study within the post-merger and acquisition context of Egypt's rapidly growing BPO/CX sector, which has received limited empirical focus despite its high consolidation activity. Paper type: Research paper. Keywords: Transformational Leadership, Employee Engagement, Idealized Influence, Inspirational Motivation, Intellectual Stimulation, Individualized Consideration, Mergers and Acquisitions, Business Process Outsourcing, Customer Experience.