18setting The Stage

The Leadership Quarterly 15 (2004) 195 – 210

Setting the stage for effective leadership: Antecedents of $ transformational leadership behavior William H. Bommer a,*, Robert S. Rubin b, Timothy T. Baldwin c a

Department of Management and Labor Relations, James J. Nance College of Business Administration, Cleveland State University, Cleveland, OH 44115, USA b Department of Management, Kellstadt Graduate School of Business, DePaul University, Chicago, IL 60604, USA c Department of Management, Kelley School of Business, Indiana University, Bloomington, IN 47405, USA

Abstract Although transformational leadership behavior (TLB) has been linked to a number of positive organizational outcomes, research regarding the antecedents of such behavior is limited. Guided by Ajzen and Fishbein’s theory of reasoned action [Psychological Bulletin 84 (1977) 888], we investigated two potentially relevant antecedents to performing TLB: cynicism about organizational change (CAOC) and the leader’s social context—specifically peer leadership behavior. We hypothesized that CAOC would negatively predict TLB, while peer leadership behavior would positively predict TLB. Further, we expected that peer leadership behavior would have a positive moderating effect on leader CAOC. Data were gathered from 227 managers from multiple organizations and their 2247 subordinates. Findings supported the proposed hypotheses. Cynicism and peer leadership behavior explained nearly one quarter (24%) of the variance in TLB. Further, it appears that both CAOC and TLB may be malleable in organizational contexts. Implications for leadership research and practice are discussed. D 2004 Published by Elsevier Inc. Keywords: Transformational leadership; Cynicism about organizational change; Reasoned action; Social information processing

1. Introduction After more than 20 years of accumulated research evidence, there is little doubt that transformational leadership behavior (TLB) is related to a wide variety of positive individual and organizational outcomes. Indeed, TLB has been empirically linked to increased employee satisfaction (e.g., Podsakoff, $

A previous version of this paper was presented at the 2001 Academy of Management Conference, Washington, DC. * Corresponding author. Tel.: +1-216-687-4782. E-mail addresses: [email protected] (W.H. Bommer), [email protected] (R.S. Rubin), [email protected] (T.T. Baldwin). 1048-9843/$ - see front matter D 2004 Published by Elsevier Inc. doi:10.1016/j.leaqua.2004.02.012

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MacKenzie, Moorman, & Fetter, 1990), organizational commitment (e.g., Bycio, Hackett, & Allen, 1995), satisfaction with supervision (e.g., Podsakoff et al., 1990), extra effort (e.g., Seltzer & Bass, 1990), turnover intention (e.g., Bycio et al., 1995), organizational citizenship (e.g., Podsakoff, MacKenzie, Paine, & Bachrach, 2000), and overall employee performance (e.g., Yammarino, Spangler, & Bass, 1993). Moreover, the effects of TLB appear to be potent across management levels (e.g., Howell & Avolio, 1993), work environments (e.g., Bass, 1985), and national cultures (e.g., Bass, 1997). While researchers have learned a great deal about the effects of leader behavior, relatively little is know about its genesis. Put simply, it remains unclear why certain people engage in TLB while others do not. TLB, like most forms of leader behavior, is traditionally viewed as an independent variable exerting influence ‘‘downstream’’ (Bass, 1995). However, if we are to understand how to influence, improve, or modify the frequency and/or display of TLB downstream, it is necessary to shift our focus ‘‘upstream’’ towards the study of TLB as a dependent variable. With increased attention being paid to successful change management in the last decade (e.g., Cascio, 1993; Katzenbach et al., 1995), organizations are accepting TLB as an important component of leading such change (e.g., Atwater & Bass, 1994; Burke & Litwin, 1992; Worley, Hitchin, & Ross, 1996). Unfortunately, organizations hoping to increase TLB have little, if any, empirical evidence to guide such change efforts. Leadership training has shown some promise in inculcating a knowledge and understanding of TLB (e.g., Barling, Weber, & Kelloway, 1996), but recent evidence suggests that the application of trained skills in the workplace is often heavily dependent on the organizational context (Baldwin & Magjuka, 1997). To date, the characteristics of the organizational context that facilitate, and are conducive to the practice of, TLB remain unspecified. That is not to say, however, that the transformational leadership literature is totally devoid of antecedent-oriented thinking. To the contrary, significant theoretical work has explored many important factors of transformational leadership and related styles such as charismatic leadership. In their forward to a special transformational/charismatic leadership issue of The Leadership Quarterly, Hunt and Conger (1999) noted that many of the contributors dealt with the notion of contextual and facilitating variables in relationship to TLB. Recent work by Shamir and Howell (1999) argued that some macro contextual variables (e.g., organizational life cycle, structure and culture) and meso contexts (e.g., goals, tasks, and technology) have a significant impact on the emergence and/or facilitation of charismatic leadership. Similarly, Bass (1985) proposed that collectivistic societies and levels of leadership might be important antecedents to transformational behavior. Conger and Kanungo (1987) purported that charismatic leadership should be related to certain behavioral components such as likableness, expertise, power base, and environmental sensitivity. Finally, as with much of the leadership research, predictions regarding leader dispositions have been offered. For instance, Bass (1998, p. 122) commented, ‘‘When it comes to predicting transformational leadership. . .there is no shortage of personality expectations. However, the empirical support has been spotty.’’ Bass continues by describing a long list of personality factors (e.g., locus of control, and conscientiousness), attitudes (e.g., optimism), and cognitions (e.g., moral reasoning) possibility associated with TLB. Consistent with Bass’ assertions, Atwater and Yammarino (1993) found that a set of personal attributes (intelligence, warmth, conformity, sensing/intuition, thinking/feeling, emotional coping, behavioral coping, and athletic experience) accounted for 28% of the variance in TLB. Howell & Avolio (1993) found that leaders’ internal locus of control was significantly related to intellectual stimulation and individualized consideration. Others have shown that variables, such as moral reasoning and physical fitness (Atwater, Dionne, Camobreco, Avolio, & Lau, 1998), emotional intelligence

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(Barling, Slater, & Kelloway, 2000), and impression management (Sosik, Avolio, & Jung, 2002), are all significantly related to TLB or charismatic leadership. Still other studies point to the potential fruitfulness of biodata as an antecedent to TLB (e.g., Avolio, 1994; Bass, Avolio, & Goodheim, 1987; House, Spangler, & Woycke, 1991). Although the review above highlights some important antecedent variables, two important limitations exist. First, the existing empirical literature tends to focus upon personal characteristics that are relatively difficult to change. While this basic research may be useful from a selection perspective, it presents substantial difficulties for those charged with training and developing people in existing management positions. Second, few studies have simultaneously examined the interaction between a malleable individual-level variable and the social context in which the person works. The purpose of the present study, then, is to explore antecedents of TLB across a variety of organizational contexts. However, with little empirical precedent, it was our belief that a strong theoretical basis for the inclusion of variables was essential. Rather than throw a host of typical measures ‘‘into the hopper,’’ our goal was to utilize a mainstream theoretical framework to guide the selection of variables that could be theoretically linked to the demonstration of TLB and then proceed from there. In organizations, one theory that has demonstrated utility in helping predict behavior from individual attitudes and context is the theory of reasoned action (Fishbein & Ajzen, 1975). From a reasoned action perspective, the best predictors of volitional behaviors are behavioral intentions. For example, the propensity to leave an organization (i.e., turnover intent) tends to be a stronger predictor of turnover than other variables such as satisfaction with pay or job involvement (Griffeth, Hom, & Gaertner, 2000). Further, the theory of reasoned action states that intentions are a function of two determinants: an individual’s attitude toward the behavior and his/her perception of social pressure to perform (or not perform) the behavior. Fishbein and Ajzen (1975) refer to the latter determinant as ‘‘subjective norms.’’ As Ajzen (1988, p. 117) noted, ‘‘people intend to perform a behavior when they evaluate it positively and when they believe that important others think they should perform it.’’ Ajzen (1991) later added a third determinant of behavioral intention called ‘‘perceived behavioral control,’’ referring to the perceived ease or difficulty in performing a behavior based on prior experience, personal abilities, and external obstacles. Finally, when attitudes are matched to the appropriate level of specificity (i.e., general attitudes predicting general behavior and specific attitudes predicting specific behaviors; Ajzen & Fishbein, 1977) and are highly personally relevant (Leippe & Elkin, 1987), behavioral prediction improves (Petty, 1995). The theory of reasoned action provides a basis for selecting appropriate antecedents of TLB. In our case, leader attitudes likely to be predictive of TLB are those (1) that are matched to the construct, (2) highly relevant and (3) indicative of one’s intention to perform the behavior. Because organizational change is a central element of TLB, one attitudinal construct that likely captures a leader’s behavioral intention is cynicism about organizational change (CAOC) (Reichers, Wanous, & Austin, 1997). It is important to note that CAOC is conceptualized as a ‘‘state’’ or attitudinal measure as opposed to the more trait-oriented conceptualization of cynicism consistent with the MMPI and other personality assessments. Additionally, following the theory of reasoned action, to enhance the prediction of TLB, we should consider a leader’s subjective norms and perceived behavioral control. In the organizational setting, a leader’s peer group is likely to provide insight into both the leader’s subjective norms and perceived behavioral control. To that end, it should be noted that we do not provide a direct test of Ajzen and Fishbein’s theory; rather, we use it as a guide for the development of hypotheses. In the following section, we expand this rationale and outline the hypotheses for testing.

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2. Hypothesis development CAOC. The last decade has witnessed an increase in attention paid to the attitude of workplace cynicism (Wanous, Reichers, & Austin, 2000). Cynicism has generally been defined as, ‘‘an attitude of contempt, frustration, and distrust toward an object or multiple objects. . .’’ (Andersson, 1996, p. 1397). Organizational leadership is often the object of such contempt and distrust (Feldman, 2000; Kanter & Mirvis, 1989). Research on cynicism, broadly speaking, has shown that it has important behavioral consequences. For instance, Reichers et al. (1997) found that cynical employees filed more grievances, had lower job satisfaction, did not believe their supervisors or top management, and were not motivated to create positive change. However, to date, there has been little research on cynicism specifically among leaders. Some recent research, however, has been conducted that is applicable to cynical leaders. Wanous et al. (2000) examined the relationship between cynicism and pay-for-performance instrumentality perceptions for hourly, incentive pay and salaried employees. Findings indicated that highly cynical employees across all three pay types had lower instrumentality perceptions. In addition, salaried employees showed higher instrumentality perceptions than nonsalaried employees. If we assume that many of the salaried employees were also managers, then these data provide preliminary evidence that cynicism is less prevalent in managerial positions but, when present, may have deleterious effects (Wanous et al., 2000). In addition, Wanous et al. found that cynicism about change was directly related to motivation to keep trying to make change. Atwater, Waldman, Atwater, and Cartier (2000) examined supervisory cynicism and its relationship with subordinate-rated leadership during an upward feedback field experiment. Supervisors were assigned to one of two conditions in which they either received feedback at Times 1 and 2 or only at Time 2. Change in ratings from Time 1 to Time 2 for both groups was predicted by cynicism. Thus, supervisors who rated themselves as highly cynical were less likely to utilize the upward feedback for behavioral change in leadership. Because specific and relevant attitudes are more likely to predict specific behaviors (e.g., Ajzen & Fishbein, 1977; Leippe & Elkin, 1987; Petty, 1995), it follows that CAOC (a change-oriented attitude) is likely to be associated with leader behaviors involving organizational change (i.e., TLB). In addition, the above literature suggests that CAOC is likely to be negatively associated with desirable leader behavior. Logically, if leaders are cynical about change, they are not likely to be champions of change, lacking the motivation and openness to engage in TLBs. The combination of theory and available empirical evidence suggests that there should be a negative relationship between leader cynicism and TLB. Stated formally, H1. Leader CAOC will be negatively related to leader TLB. In addition to the behavioral intention component used to develop the first hypothesis, the theory of reasoned action also emphasizes the role of subjective norms and perceived behavioral control. To further the understanding of TLB, one highly salient source of such contextual information is the leader’s peer group. Because we are interested in explaining a leader’s TLB, the TLB exhibited by the peer group would appear particularly relevant. Multiple perspectives support the idea that the people in organizations use the behavior of others to inform and regulate their own behavior (e.g., Bandura, 1977; Cialdini, 2001; Salancik & Pfeffer, 1978). For instance,

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Salancik and Pfeffer’s (1978) social information processing theory holds that work attitudes are in part socially constructed as the result of perceptual information coming from proximal organizational members. In other words, leaders do not behave in a vacuum where their own attitudes completely determine their behavior. To the contrary, the behavior of others will provide behavioral cues that may have significant influence on leadership behavior because the work setting is generally regarded as a ‘‘strong’’ situation (Schneider, 1987). Social information processing is predicated on the notion that people form ideas based on information drawn from their immediate environment, and the behavior of coworkers is a very salient component of employees’ environments. Therefore, observing frequent ‘‘transformational activity’’ within a work setting is likely to lead to attitudes that such behavior is normal. Consequently the individual is likely to replicate this ‘‘normal’’ behavior (Salancik & Pfeffer, 1978). Salancik and Pfeffer (1978, p. 227) posit that the social context ‘‘focuses an individual’s attention on certain information (i.e., de-emphasizing other information), making that information more salient, and provides expectations concerning individual behavior.’’ Therefore, as individuals search for meaning to subjective phenomena in the work place, the context influences what information is weighted heavily and what is given less importance. Another relevant approach was articulated by Meindl (1990). He asserted that leadership behavior may be acquired through social contagion processes whereby followers of a given leader spontaneously spread their leadership experiences. As Meindl explains, ‘‘The pent up needs, inhibitions, arousal, etc. that characterize followers make them susceptible to the influence of other followers who function as initiators. . .’’ (p. 191). Put simply, leaders’ attitudes and behaviors are often ‘‘contracted’’ (for better or for worse) much like a cold and passed on to others who come in contact with those leaders. In all, these theoretical perspectives argue that one’s immediate social context has significant influence on individual behavior. From the theory of reasoned action, peer leadership is likely to influence leaders’ subjective norms and perceived behavioral control. More specifically, when a leader’s peers perform TLB, the behavior should be perceived to be important or necessary because it conveys the content and consequences of performing such behavior. The leader’s peer group creates a subjective norm that in part guides the leader’s behavior. In addition, seeing peers engage in a specific behavior should increase the leader’s perceived behavioral control (Ajzen, 1991) such that the leader is more likely to believe that he/she can perform the behavior successfully. Consistent with social information processing, normative pressures, and the perception that normative behavior is within the leader’s control may direct the leader to model or mimic the TLB of his/her peers. Based on this reasoning, H2. The level of TLB shown by a leader’s peers will be positively related to the level of TLB shown by the leader. Beyond the main effects hypothesized above, Ajzen (1991) suggests that the interaction of the attitude toward the behavior and contextual influences (subjective norms and perceived behavioral control) should provide enhanced predictive power. Because behavior is difficult to predict solely from attitudes, the interaction of the environment enhances that prediction by capturing another source of attitudinal influence. In other words, it is unlikely that a leader’s attitude simply exists in isolation but is rather heavily influenced by many sources. One such source is the behavior of his/her peers.

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Specifically, the leader’s social context should moderate the relationship between leader’s CAOC and TLB such that the social context may overpower the leader’s propensity to act based solely on his/her CAOC alone. This previous argument suggests that leaders who are more cynical about organizational change may be less able to act on this attitude when working with peer leaders who are less cynical about organizational change. This may be because the social information being communicated through peer behavior indicates appropriate (i.e., rewarded) and inappropriate behavior. Similarly, a leader who is less cynical about organizational change yet finds him/herself in a group of peers who are quite cynical may be driven to express a higher level of cynicism about change than he/she would on his/her own. In this case, the leader would be expected to engage in less TLB than his or her CAOC alone would predict. Thus, we suggest the following interaction: H3. The level of leader behavior shown by a leader’s peers will moderate the relationship between the leader’s CAOC and the leader’s TLB. Specifically, increased levels of peer TLB will reduce the negative relationship between leader CAOC and TLB. Because this research employs a cross-sectional design and utilizes survey methodology, we wanted to provide additional rigor by controlling for some potential confounds in our design. First, we used different data sources whenever possible, thereby limiting the inflation problems associated with much of the extant leadership research. As a result of same source variation, much of the existing research has systematically overestimated the actual relationships of interest. In addition, some organizational variables that have demonstrated influence on TLB and may mask the effects of the antecedent variables above include managerial level, managerial experience, span of control, and organizational tenure (e.g., Shamir, Zakay, Breinin, & Popper, 1998). Practically speaking, we did not collect all of these variables; however, we were able to measure managerial level and tenure. We do not offer specific hypotheses for managerial level and tenure but do include them in our analyses to control for their potential effects.

3. Method 3.1. Procedure 3.1.1. Participants Participants in this study were managers occupying positions ranging from first-line supervisors to corporate officers. To be included in the study, two specific conditions needed to be satisfied: (1) the manager had to have two or more of his/her subordinates describe his/her leadership behavior and (2) the manager had to complete a survey assessing his/her CAOC. In all, over 3500 employees were surveyed. The current study used 2247 of these employee surveys. The surveys of the remaining employees were not used because they either (1) described a leader who did not complete a survey or (2) they were the only employee to complete a survey for a leader who did complete his or her survey. Overall, 227 leaders from eight nonunionized domestic manufacturing firms met the above inclusion criteria. The majority of the leaders reported being male (81%) with a mean age of 38.1 (SD = 10.2). The leaders in this sample had an average organizational tenure of 10.5 (SD = 8.0) years and were rated

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by an average of 9.9 (SD = 11.6) employees. The mean age of the raters (i.e., the subordinates) was 37.3 (SD = 10.8). 3.1.2. Data collection Data were collected systematically at each manufacturing site. First, all employees (i.e., from floor workers to corporate officers) were scheduled for a data-gathering session in the company’s training or break room. At each session, the first author introduced himself and provided employees a letter ensuring the confidentiality of responses and a description of the study. In addition, each employee was provided a letter from the company’s president also pledging confidentiality. All employees filled out a questionnaire that included an assessment of their immediate supervisor’s TLB, a measure of CAOC, and demographics. 3.2. Measures To clearly present how the measures were obtained and calculated, it is necessary to define a few terms. First, the term focal leader describes one of the 227 managers who are the focus of the study. Next, the term ‘‘peer managers’’ identifies the focal leaders’ peers. These peer managers were defined as other managers who reported to the same boss as the focal leader. In other words, a group of vice presidents who reported to the president would be peers, as well as a group of first-line supervisors who report to the same plant manager. 3.2.1. CAOC Although multiple scales have been developed to assess general cynicism, we used Reichers et al.’s (1997) scale of CAOC. Their eight-item scale assesses employee feelings of futility and internal attribution (i.e., inside the company) of blame for their futility. This scale was selected because it seemed to best capture the focus on organizational change with which TLB is associated. In their initial testing of the scale’s properties, Wanous, Reichers, & Austin (1994) reported an internal consistency reliability coefficient of .86 from a sample of 757 manufacturing employees. Sample items from this scale include ‘‘Attempts to make things better around here won’t produce good results’’ and ‘‘The people who are responsible for making things better around here don’t care enough about their jobs.’’ Each focal leader responded using a seven-point Likert-type scale ranging from strongly disagree to strongly agree. Higher scores on this measure indicate greater leader CAOC. In the current sample, the interitem reliability was .90. 3.2.2. TLB The leader behaviors used in this study were the TLBs developed by Podsakoff et al. (1990) and were rated by the focal leaders’ direct reports. TLB has received substantial attention in the leadership literature and is widely used in empirical leadership research (e.g., Bass, 1997; Podsakoff, MacKenzie, & Bommer, 1996; Podsakoff et al., 1990). Specifically, the Podsakoff et al. (1990) measure is comprised of 24 items pertaining to six transformational leader dimensions including articulating a vision (e.g., talks about the future in an enthusiastic, exciting way), providing a model (e.g., sets a positive example for others to follow), communicates high-performance expectations (e.g., will not settle for second best), provides individual support (e.g., shows concern for me as a person), fostering the acceptance of group goals (e.g., encourages a team attitude and spirit among employees), and providing intellectual

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stimulation (e.g., suggests new ways of looking at how we do our jobs). After examining the scale intercorrelations and conducting an exploratory factor analysis, the transformational behaviors were collapsed to form a single measure and had high internal consistency reliability (a=.95). This leader behavior index was then averaged across all of the focal leader’s direct reports (as identified by company records) to provide a single score for the focal leader’s TLB. To check whether the raters were ‘‘seeing the same thing,’’ we calculated a measure of rater agreement (i.e., rwg). James, Demaree, and Wolf (1984) assert that the rwg statistic provides a valid estimate of actual within-group agreement, and that an rwg equal to or greater than .70 demonstrates acceptable levels of agreement and suggests that aggregation to the group level is valid. For the TLB measure, the mean rwg was .92, suggesting that there was a high level of agreement between the multiple raters. 3.2.3. Peer’s TLB To measure the behavioral social context of the focal leader’s environment, we focused on the peer managers. The plant manager at each location identified the peer groups as supervisors who worked on the same shift, are in the same location, and would interact with each other. As with the calculation of the focal leader’s TLB score, each peer manager had a separate TLB score based upon his/her direct reports’ ratings. More specifically, a single TLB score for each peer manager was calculated. Then, the average was taken across the peer managers to provide a single peer TLB score for each focal leader. This average did not include the focal leader’s TLB score to avoid creating observational dependencies in the measures. On average, the peer measure was based upon the behavior of 4.8 peers (SD = 2.2). The rwg across the peers’ TLB was .72, suggesting that aggregating the data is appropriate (James et al., 1984). 3.2.4. Control variables To control for the likelihood that the different nature of the work and the increased managerial experience of higher-level managers could be associated with the level of TLB exhibited, the managerial level of the focal leader was coded. More specifically, focal leaders who were first-line supervisors were coded ‘‘1,’’ middle managers were coded ‘‘2,’’ and corporate officers were coded ‘‘3.’’ In addition, organizational tenure was included because tenure may be associated with different levels of exposure to organizational norms and practices. Tenure was measured as the years the focal leader had worked for his/her organization. Note that dummy variables representing the leader’s organization were not significant, so we excluded the organization as a control variable to present the results more concisely.

4. Results 4.1. Descriptive statistics and intercorrelations Descriptive statistics and intercorrelations for all study variables are presented in Table 1. Of particular interest are the relationships associated with the focal leaders’ TLB. More specifically, both CAOC (r = .29, p < .01) and the average peer manager’s TLB (r=.45, p < .01) were significantly correlated with the focal leaders’ level of TLB. Further, it should be noted that in neither of these cases is same source variance a potential source of inflation as the measures were provided by different sources.

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Table 1 Descriptive statistics and intercorrelations among study variables Managerial level Organizational tenure CAOC Average peer managers’ TLB Focal leader TLB

M

SD

1.35 10.46 2.85 4.89 4.86

0.60 7.95 1.22 0.61 0.78

1

2 (–) .17 .31 .32 .28

3 (–) .08 .08 .03

(.90) .31 .29

4

5

(.95) .45

(.95)

N = 227 for all correlations. Reliability coefficients are presented in the diagonal. All correlations greater than .16 are significant at p < .01.

4.2. Regression results To better understand the relationships hypothesized in this article, a hierarchical regression analysis consistent with the recommendation of Cohen and Cohen (1983) and Stone and Hollenbeck (1989) was conducted. Consistent with the recommendation of Aiken and West (1991), the interaction term was calculated using mean-centered variables to reduce the multicollinearity between the main effect terms and the interactions composed of those terms. Step 1 of the regression analysis provides the results for the main effects hypotheses (H1 and H2), whereas the interaction hypothesis (H3) is assessed from Step 2 of the regression analysis and the follow-up plot. Each regression equation used the focal leaders (N = 227) as the unit of analysis. Further, managerial level, organizational tenure, and CAOC all refer to the focal leader, and the average peer manager’s TLB refers to the average TLB of the focal leader’s peers. The results of the regression analysis are presented in Table 2. The regression weights in Table 2 are standardized beta weights. H1 posed that focal leader CAOC would be negatively related to focal leader TLB. As shown by the significant regression weight associated with CAOC (b = .131, p < .05) in Model 1 of Table 2, H1 was

Table 2 Hierarchical regression results for antecedents of focal leader TLB Step 1 Managerial level Organizational tenure CAOC Average peer managers’ TLB Step 2 CAOC  Average peer managers’ TLB Change in variance explained (DR2) Adjusted variance explained (R2) N = 227; * p < .05. **p < .01. *** p < .001.

Model 1 b

Model 2 b

.123 .017 .131* .367***

.125 .017 .130* .372***

.220

.121* .020* .240

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supported; that is, focal leaders who were more cynical about organizational change exhibited lower levels of TLB than focal leaders who were less cynical. H2 suggested that the level of TLB shown by peer managers would be positively related to the level of transformational leadership shown by the focal leader. The regression analysis supports H2 (b=.367, p < .001). Thus, the TLB of peer managers was significantly associated with increased TLB by the focal leader. Going beyond the main effects hypothesized in H1 and H2, the third hypothesis (H3) predicted that the peer managers’ TLB would moderate the relationship between the focal leader’s CAOC and the focal leader’s TLB. Specifically, H3 predicted that increased levels of peer manager TLB would reduce the negative relationship between the focal leader’s CAOC and his/her TLB. The moderated hierarchical regression results presented in Model 2 of Table 2 indicate that the mean-centered interaction term (Jaccard & Wan, 1995) between CAOC and peer TLB was significant (b=.121, p < .05) and explained significant incremental variance (DR2=.020, p < .05). This significant interaction term suggests that a further exploration of the relationship’s form is needed. Consequently, we performed a median split-plot regression analysis consistent with the recommendations of Cohen and Cohen (1983) and Podsakoff, MacKenzie, Ahearne, and Bommer (1995). Thus, we split the moderator variable into a ‘‘high’’ and ‘‘low’’ condition (i.e., higher than the mean and lower than the mean) and ran two separate regression equations of the variable in the interaction term with the moderator (along with the control variables). The results of this analysis are then plotted to show the ‘‘form’’ of the moderated relationship (Cohen & Cohen, 1983; Podsakoff et al., 1995). The result of this analysis may be seen in Fig. 1. The plot in Fig. 1 is consistent with the form of the interaction specified in H3. More precisely, when peer managers’ TLB is relatively high, the relationship between CAOC and the focal leader’s TLB is not statistically different from zero (b=.008, ns; unstandardized beta weight=.004, SE=.062, ns). However, when peer managers exhibit less transformational behavior, the relationship between CAOC and the

Fig. 1. Split-plot analysis for the interaction of CAOC  Average Peer Managers’ TLB.

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focal leader’s TLB is negative (b = .26, p < .01; unstandardized beta weight = .166, SE=.056, p < .01). In other words, the presence of positive peer behavior reduces the negative relationship between CAOC and TLB. In fact, these results suggest that positive peer behavior negates the negative impact of CAOC on TLB. Beyond the evidence provided for the individual hypotheses, Table 2 provides additional important information; that is, the proportion of variance explained in the TLB of the focal leaders (R2=.24) is relatively large given that the results are not subject to same source inflation. Further, it is exceptionally encouraging that such a small number of variables accounted for approximately one quarter of the variance in focal leader TLB. Thus, we think these results provide an important inroad to understanding the antecedents to TLB.

5. Discussion 5.1. Synthesis of findings Considerable prior research has shown that TLB is related to a variety of positive organizational outcomes. Accordingly, the primary objective of this study was to better understand why certain managers engage in TLB while others do not. Across 227 practicing managers in a number of companies and contexts, we were able to explain about one quarter of the variance in TLB as a function of two variables: (1) those managers’ level of cynicism toward organizational change and (2) their peers’ use of leadership behaviors. While there are obviously other factors that contribute to the practice of TLB, the present study is an important step in specifying the social context that facilitates or inhibits such behavior. Perhaps the most compelling finding is that management members who have higher CAOC are less likely to engage in TLB. Thus, managers were in fact more likely to perform TLB when they believed that positive change was possible. Conversely, leaders with cynical attitudes regarding the potential for organizational change were significantly less likely to exhibit TLB. In short, the attitude of managers regarding their organizational context differentiates those who engage in TLB from those that do not. A second important finding was that the level of TLB exhibited by managers was positively related to the TLB of the managerial peers. The influence of peers has a rich history in behavioral research, dating at least to the Hawthorne studies (Roethlisberger & Dickson, 1939), and is also entirely consistent with the theory of reasoned action. As Ajzen (1988, p. 117) noted, ‘‘people are more likely to perform a behavior when they believe that important others think they should perform it.’’ Yet, however theoretically and intuitively appealing, peer influence has been curiously neglected in the empirical literature. Indeed, the present study is one of the first reports of which we are aware that has documented leadership outcomes associated with this type of peer behavior. A third finding that warrants highlighting is the significant interaction of cynicism and peer influence on TLB. Specifically, the presence of peers performing TLB in the environment of a cynical leader reduces the consequences of that leader’s CAOC. Put another way, greater exhibition of TLB throughout an organization appeared to have the benefit of ‘‘canceling out’’ some of cynicism’s negative effects on leaders.

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5.2. Implications Few things matter more in the life of a firm than how people feel about how they are managed and led. Indeed, there is growing evidence that organizations that foster good leadership outperform their rivals (Pfeffer, 1994). Results of the present study point to several implications for how organizations view and manage their leadership development. First, CAOC (particularly among managers—who have much greater visibility than nonmanagers do) is likely to be a ‘‘poison’’ to the success of any TLB development initiative. Addressing the cause and cure for such cynicism is therefore critical for any organization that is hoping to build some TLB momentum. From a practical perspective, one encouraging feature of CAOC is its believed malleability; that is, unlike more stable attributes (e.g., neuroticism), some recent evidence suggests that cynicism can be influenced and reduced. A number of strategies for addressing cynicism have been proposed, and most deal with the ways in which change is communicated and the level of participation of managers in the change process (Kotter, 2002; Reichers et al., 1997). In our view, the present findings do not suggest the removal or censure of highly cynical managers (those who express doubt that organizational changes will be successful). Indeed, we contend that such an approach would often be shortsighted and ultimately counterproductive. In fact, recent research (McClough, Rogelberg, Fisher, & Bachiochi, 1998) suggests that organizational members who are cynical are often highly engaged and care deeply about organizational issues. Thus, a more fruitful approach would be to address cynicism directly in an attempt to redirect the negative energy exerted towards organizationally productive activities. Much like how former drug users often make the most compelling advocates of drug prevention, converted cynics can be among the most credible and persuasive champions of organizational change efforts. Second, the influence of peers discovered here suggests that leadership is as much a collective activity as it is an individual or heroic one. Although there is much recent interest in ‘‘top-grading’’ (i.e., the identification of top managerial talent) and high-potential programs (Smart, 1999), our findings point to the continued importance of the broad development of managerial talent. The old proverb that ‘‘it takes a village to raise a child’’ may be an apt analogue to the importance of an overall leadership culture, vis-a`vis a set of isolated and prominent individual leaders, for inducing TLB. Creating a context that develops, nurtures, and rewards the use of TLB across the full cadre of management members in an organization may well be a more effective course of action than more selective management development approaches. Taken together, the present findings add empirical support and specification of key factors to the already intuitive importance of organizational context in inducing desirable leadership behavior. Although training/educating managers in the ‘‘how,’’ ‘‘when’’ and ‘‘why’’ of TLB is well advised, it is unlikely to be sufficient in the absence of a context supporting TLBs. Recent work on the transfer of training has found that contextual factors can easily overwhelm the effects of the best planned and delivered learning experience. In contrast, a favorable context can enhance even suboptimal training (Baldwin & Magjuka, 1997; Rouiller & Goldstein, 1993). Of course, recognition of the importance of context to leadership is hardly new; Fiedler (1967) and others have made that case for many years. The vast majority of existing leadership research focuses upon the context moderating the effectiveness of certain behaviors as is the case in House’s (1971) path goal theory, Kerr’s (1977) substitutes for leadership approach, or Hersey and Blanchard’s (1969)

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situational leadership theory. The findings of this study, however, address a more primary issue than the role of context in the situational models of the 1970s; that is, we now provide some evidence for why leader behavior occurs in the first place. 5.3. Future research directions Although this study has promising results and some positive methodological strengths (e.g., multiple sources of data, large multiorganization sample, multiple raters of behavior, etc.), two limitations warrant specific mention. First, the research design was cross-sectional, making any interpretations of causal direction tentative. For example, it is possible that leaders who engage in transformational behavior are perhaps more likely to identify with organizational change efforts and thus likely to be less cynical about organizational change. Similarly, the TLB of the focal leader could be influencing the TLB of his or her peers (rather than the opposite). Second, leadership is an area that garners great attention in both the academic and popular literature, and we suspect that there is a host of variables that others might postulate to predict TLB. We included two in our investigation, and the inclusion of other variables (e.g., abilities, perception of followers, boss’s behavior, motivations) will certainly expand some of the current findings. When using samples of busy, overcommitted managers, the challenge is to efficiently collect those data (and just those data) which will explain the behaviors of most conceptual and practical import. The current study explained considerable variance in TLB, but there are certainly a number of other potential predictors that warrant investigation. For the future, we contend that shifting the focus ‘‘upstream’’ (i.e., toward antecedents) is not only warranted but has the potential to make strong contributions towards explaining why some leaders engage in TLB and others do not. One promising line of inquiry is the continued investigation of social context and attitudes to predict leader behavior. For example, the behavior of the leader’s boss and behavioral feedback received from the leader’s followers may contribute to strong normative situations. Similarly, with respect to attitudes, other change-oriented attitudes, such as organizational commitment, turnover intention, and resistance to change, may broaden the understanding of the antecedents to TLB. In addition, inasmuch as TLB is often driven from the leader’s personal values, a focus on leader’s values and congruence or shared values (Jones & George, 1998) with peers may be an important antecedent condition. It should be noted, however, that the present study and the above areas for research focus on proximal contextual variables that exist at the individual or group level. An ultimately more challenging task for researchers will be to understand antecedent conditions of TLB at the more distal, organizational level (Pawar & Eastman, 1997). The notion of ‘‘TLB-friendly’’ cultures is appealing but also wrought with complexity of research design and measurement. It will be creative empirical explorations into those domains that may well provide the most useful insights as to how best to set the stage for managers to engage in TLB.

Acknowledgements The authors would like to thank Ed Miles and Mike Leippe for their helpful reviews on previous drafts of this manuscript.

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