| Summary: | The emerging concept of globalization has influenced the business activities of the organizations across the world. At one hand the concept of globalization has created vast opportunities for the businesses to expand beyond their traditional national boundaries, but at the other hand it has also created challenges for management of organizations. Management of workforce diversity is among the most critical challenges. Leaders have to face such challenges in organizations having diverse workforce from different cultural and ethnic backgrounds. Leaders influence their subordinates through different leadership practices and strategies. The main aim of leaders is to motivate employees so that they can work best in the interest of leaders which in turn will fulfil the objectives of organization. This study is aimed to explore the impact of leadership on motivation of employees in multiethnic working environment. For this purpose, data from two airline companies is collected to explore the impact of leadership. A questionnaire has been designed for the collection of data having two parts; one consisting of questions asked from employees and the second part consisted of interview questions asked from managerial staff of organizations. The data collected is analysed by applying Structural Equation Modelling Approach using AMOS and SPSS. Moreover, cultural differences and leadership practices of British Airways and Saudi Airlines have also been studied. The findings of the study reveal that leadership has a great influence on motivational level of employees in multiethnic working environment. Leaders, understanding the need of change in leadership practices and styles according to the requirements of work environment diversity, adopt leadership practices that can align with the values and expectations of multiethnic workforce, hence influence positively on motivational level of employees. While organizations in which there is a rigid culture of leadership and does not change accordingly, put a negative influence on the motivational level of multiethnic workforce.
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