The relationships between servant leadership, strategic alignment, and financial performance

Literature is moving away from transactional leadership toward more moral types of leadership, in which servant leadership plays a significant role the last few years. Using this leadership theory, this study examined the relationships among servant leadership, strategic alignment, and financial performance at the team level. In addition, this study also explored the effects of interaction of both servant leadership and organizational identification on strategic alignment and whether strategic alignment mediates the relationship between servant leadership and financial performance. Data were collected from 294 employees, working in 25 teams in 17 organizations from a variety of industries in the Netherlands. The results were analyzed at team level. The results showed that (1) servant leadership is positively related to strategic alignment and that organizational identification partly weakens the relationship between servant leadership and strategic alignment. Practical implications of the findings were discussed, together with limitations and further recommendations.