Vision 20(2) 111–120

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Leadership Styles, Leader’s Effectiveness and Well-being: Exploring Collective Efficacy as a Mediator

Kiran Sakkar Sudha1 M. G. Shahnawaz2 Anam Farhat3

Abstract The present study explored the relationships among leadership styles, leader’s effectiveness and well-being directly as well as indirectly through collective efficacy among the employees of the education industry, the latest entrant on the Indian scene. Ninety full-time employees participated in the study. They were administered the Multifactor Leadership Questionnaire (MLQ; Bass & Avolio, 2004. The multifactor leadership questionnaire: Third edition manual and sampler set), Job-related Affective Well-being Scale (JAWS; Van Katwyk, Fox, Spector & Kelloway, 2000. Journal of Occupational Health Psychology, 5[2], 219–230) and Collective Efficacy scale (Karrasch, 2003. Lessons learnt on collective efficacy in multinational teams. Alexandria, VA: United States Army Research Institute for the Behavioral and Social Sciences). Mediation regression analysis was used to test the hypotheses. The results revealed that transactional style has influ- enced both the outcome variables directly as well as indirectly more than the other two leadership styles. The study contributes to the scantly explored indirect linkages of collective efficacy on leadership styles, effectiveness and well-being.

Key Words Leadership styles, MLQ, Leader’s effectiveness, Well-being, Collective efficacy and Mediation analysis

Article

1 IILM School of Business and Management, Gurgaon, Haryana, India. 2 Department of Psychology, Jamia Millia Islamia, New Delhi, India. 3 Indian Institute of Management Calcutta, Kolkata, West Bengal, India.

Corresponding author: M.G. Shahnawaz, Department of Psychology, Jamia Millia Islamia, New Delhi 110 025, India. E-mail: [email protected]

Introduction

In the contemporary flat networked organizations, individ- ual resources and affective states are not sufficient to attain competitive advantage; therefore, there is a need to explore team/group-related constructs (Kozlowski & Klein, 2000). Collective efficacy is one such construct, as it represents values, beliefs, affective states and emotions, as exhibited by the group members with reference to ‘the performance capability of a social system as a whole’ (Bandura, 1997, p. 469). Leadership plays an important role in the develop- ment of collective efficacy. There are studies to support that transformational leadership is positively related to trust in team leaders, collective efficacy and team perfor- mance (Hoyt & Blascovich, 2003). Hannah and Luthans (2008) opined that positive psychological states (such as well-being, affect and happiness) and efficacy processes directly promote effective leader engagement, flexibility and adaptability across the varying situations which lead

to attainment of the goals. The role of emotions, affect, positive emotional states, happiness and well-being has received considerable attention in the past few years as there are strong linkages between one’s affective states and outcome variables. Job-related affective well-being or well-being at workplace in simple terms is the experience of volleys of emotions at workplace in response to work- place stimulus. There is a strong association between measures of employees wellbeing and job performance (Wright, Cropanzano & Bonnett, 2007), leading to enhance- ment of personal resources (affect, efficacy, happiness, satisfaction etc.); however, there is a need to explore these linkages at the group level.

In the organizational context, direct one-to-one relation- ship between constructs negates the complexities of the organization. Therefore, it is essential to understand the strength of indirect linkages among the work-related con- structs and beyond. There are relatively fewer empirical studies conducted to explore the indirect role of collective

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efficacy on leadership styles, leaders’ effectiveness and job affect, even though there are many which explored the direct one-to-one linkages in general as well as in the context of teams (Chou, Lin, Chang & Chuang, 2013). The present article is an attempt to provide some insight in the so far neglected area of research by exploring the indirect/mediating role of collective efficacy on leader- ship styles, leader’s effectiveness and well-being among employees from the education industry in India.

Collective Efficacy

Collective efficacy is a recent addition to the growing body of research in the area of self-efficacy. Collective efficacy is ‘a group’s shared belief in its conjoint capabilities to organ- ize and execute the courses of action required to produce given levels of attainments’ (Bandura, 1997, p. 477). Collective efficacy is manifested through shared goals and collaborative decision-making in the organization (Maddux, 2002). Research on collective efficacy is not as extensive as on personal efficacy, and there still exists empirical evidence that collective efficacy is related to team-effectiveness and motivation (Prussia & Kinicki, 1996), transformational leadership, potency and high unit performance (Bass, Avolio, Jung & Berson, 2003) and so on. The link between collective efficacy and performance has been reported across industries such as corporate, educational, sports, nursing and military (Bandura, 2000; Zaccaro, Blair, Peterson & Zazanis, 1995). Collective efficacy also contributes to well-being and is instrumental in the achievement of long-term goals (Bandura, 1997; Blecharz, Luszczynska, Tenenbaum, Scholz & Cieslak, 2014). The indirect role of self-efficacy on well-being, studied by Pomaki, Karoly and Maes (2009), revealed that self-efficacy impacts work behaviours, which in turn influ- ence well-being and happiness at work. However, there are not many studies which explored indirect linkages. As leadership plays a very important role in the organizational context, the present article is an attempt to explore the mediating role of leadership styles between collective effi- cacy and some outcome variables.

Leadership Styles

Leadership is one of the widely studied and ever-advancing concepts. Leadership researches have historically evolved across three eras—trait, behaviour and contingency (Chemer, 2000; Yukl, 2002) and they are also considered as three approaches to leadership. However, there are many more new developments which are coming up (Yukl, 2006), which is beyond the scope of this article; hence, a widely used notion of leadership was used in the current study. The ‘Multifactor Leadership’ (Bass & Avolio, 1994, 2004) is one of the important models of leadership which is also referred to as ‘full-scale leadership’ as it identifies transactional, transformational and laissez-faire or passive/

avoidant leadership. There is a famous tool, Multifactor Leadership Questionnaire (MLQ), which is based on this conceptualization and the present research followed this tradition. A brief description of these three is as follows:

1. Transformation leadership is associated with most positive connotations where behavioural facets such as motivation, emotional connect and sense of effi- cacy are contributory factors and has significant impact on performance and other organizational outcomes (Bass, 1985; Burns, 1978). Idealized influ- ence or charisma, intellectual stimulation and indi- vidual consideration are some of the key factors associated with transformational style. Transforma- tional leadership style is based on mutual admira- tion with common vision, and creative exchange of ideas. Reviews suggest that the worldview of leaders affects transformational leadership and lead- ers’ effectiveness (Kejriwal & Krishnan, 2004). Singh and Krishnan (2005) found that 44 per cent of the universal construct of transformational leader- ship is valid in India and the rest 56 per cent of the construct consists of unique formulations of transformational leadership.

2. Transactional leadership style operates as a kind of social exchange between the leaders and the follow- ers (Bass & Avolio, 1993). It is a kind of leadership in which compliance from the follower is obtained through the use of reward and punishment. The focus of this style is to supervise, organize and perform individually as well as a group. The leader closely monitors the work of the followers and ensures that he/she follows the prescribed paths.

3. Laissez-faire leadership style has been explained as ‘abdicates responsibilities and avoids making decisions’ (Luthans, 2005, p. 562; Robbins, Judge & Sanghi, 2007, p. 475) or a failure of taking a manag- ing responsibility (Avolio, 1999; Bass, 1998). For many researchers it has negative connotations and therefore it is also called as avoidant or non- leadership style (Harland, Jones & Rieter-Palmon, 2005; Kurfi, 2009). This style has been found to be less effective compared to the transformational and transactional leadership styles (Goodnight, 2004). According to Avolio (1999), laissez-faire style is ‘poor, ineffective and highly dissatisfying for followers’ (p. 55).

Leadership and leadership styles are fertile areas of research and previous researchers have reported direct linkage between leadership styles and effectiveness (Sadeghi & Pihie, 2012), efficacy (Jung & Sosik, 2002) and well-being (Nielsen & Daniel, 2012; Renehan, 2007). While indirect linkages have not been explored much, some studies report indirect relationship between leader- ship style and collective efficacy (Chou et al., 2013), as

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well as leadership style and well-being (Lee, Kim, Son & Lee, 2011; Ogbonna & Harris, 2000).

Leadership Effectiveness

Leadership effectiveness is a significant concept in the area of leadership. Bass and Stogdill (1990) catalogued more than five thousand definitions of the same. In a nutshell, leadership effectiveness focuses largely on output measur- ability and accomplishment of shared goals. Cooper and Nirenberg (2004) see it as coping with changing demands so as to establish successful relationship at the level of cus- tomer, employee and organizational purpose and building strong positive relationships. The leadership style is the most essential factor which influences leadership effective- ness (Bruno & Lay, 2006; Hur, Van den Berg & Wilderom, 2011). In the context of multifactor leadership taxonomy (Bass & Avolio, 1995), transformational leadership style is more effective leadership style than transactional and laissez-faire (Judge & Piccolo, 2004). Transformational and transactional styles generally share positive relations with effectiveness while laissez-faire shares a negative one. Leadership effectiveness has also been studied as a direct and positive predictor of collective efficacy (Walumbwa, Wang & Lawler, 2003). Some studies have explored the indirect relationship among the constructs and found that collective efficacy mediated relationship between transform- ational leadership style (Ross & Gray, 2004) and outcome variables, as well as between leadership effectiveness and well-being (Krishnan, 2012; Tabbodi & Prahallada, 2009). In the present research, leadership effectiveness has been assessed with the help of nine items of MLQ.

Job-related Well-being

Job-related well-being refers to a variety of emotional experiences at work and how they influence personal and organization related outcomes. The construct of well-being is quite old; however, it has got momentum in the past few years, especially with the advent of the positive psycho- logy movement. There are many conceptualizations of well-being and Warr (1987, 1990) gave one of the earliest conceptualizations of the construct in the context of work. For Warr, well-being is a two-dimensional construct: arousal and pleasure, the various combinations of these two would result in many work-related affect. Van Katwyk et al. (2000) extended the work of Warr and developed a construct and a tool known as job-related affective well- being scale (JAWS) using the same two dimensions of Warr. It has four sub-dimensions (based on the original two dimensions of arousal and pleasure) and 30 work-related affects. The conceptualization of Van Katwyk et al. (2000) was used in the present research. Extensive literature exists on the relationship among affect, emotions, collective effi- cacy, performance, effectivity, group dynamics and so on (Lent & Schmidt, 2005). Kuoppala, Lamminpac, Liira and

Vaino (2008) conducted a meta-analytic review of the con- struct and reported that there existed small to moderate impact of good leadership on employee well-being across thousands of studies. A number of studies show that trans- formational leadership is positively related to health and well-being (Hetland, Sandal & Johnsen, 2007; Walumbwa, Wang, Lawler, & Shi 2004). In recent years, besides these direct relationships, many indirect/meditational models have been examined showing the relationship between transformational leadership and outcomes, such as (a) trust and value congruence on performance (Jung & Avolio, 2000) and (b) empowerment, cohesiveness and collective efficacy on performance (Jung & Sosik, 2002). In the present research, we have used not only transformational leader- ship but also transactional as well as laissez-faire to see how these styles influence job-related well-being and leaders’ effectiveness directly as well as indirectly through collective self-efficacy.

Hence, on the basis of the review, the following hypoth- eses were formulated:

H1: Collective efficacy would be related differently to three leadership styles (transformational, transac- tional and laissez-faire), leader’s effectiveness and well-being.

H2: Collective efficacy would mediate the relationship between three leadership styles (transformational, transactional and laissez-faire) and leader’s effec- tiveness and well-being.

Research Context: Education Management Industry

Spending on education in an average Indian household has increased manifold as a result of globalization (Indian Brand Equity Foundation, 2014). It is presumed that Indian education sector’s market size will rise up to ` 6,024.1 billion (US$100.23 billion) by 2015 (Ministry of Finance, Press Information Bureau (PIB), Media Report, Ministry of Education, Department of Industrial Policy & Promo- tion (DIPP). The education management industry is not blossoming in the area of education or research alone, cor- porate investments are among the new trends as many leading industrial houses such as HCL, Wipro, Hero Corp, Jindals and so on are trying their fortune in the booming educational industry. As this is one of the emerging new wave industries, stakes are very high and there is an urgent need to empirically explore the linkages among leader- ship styles, collective efficacy, well-being at work, leadership effectiveness, just to mention a few of the constructs. As these constructs have already been explored in other organ- izational contexts and proved to be vital for their survival and growth, there is a need to take them to new industries such as ‘education’. Like any other industry, the ‘educa- tion’ industry would also be complex entity, so indirect linkages would be explored among the constructs, as

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already mentioned in the text besides the direct relation- ship. The education industry is also organized around teams; therefore, it is believed that collective efficacy would be mediating the relationship between leadership styles and effectiveness as well as with well-being. The present study is a modest attempt to explore these linkages in a new form of industry in the Indian context.

Method

Sample

The data were collected from 90 management employees from an education management organization situated in Delhi/National Capital Region (NCR). Minimum qualifi- cation was a master’s degree and with at least four years’ work experience. Participants were informed about the aims and objective of the research and had the freedom to withdraw any time from the research process. All the participants were in the age group of 28 to 32 years, 30.22 years being the mean.

Design

The present study is designed to examine the direct and indirect relationship among the variables collective effi- cacy, leadership styles (transformational, transactional and laissez-faire), leader’s effectiveness and job affect follow- ing a correlation design. Leadership styles were treated as the predictors, leaders’ effectiveness and wellbeing were the criterion and collective efficacy worked as the mediator between the two. For mediation, ‘process’ of Hayes (2012) was used. ‘Process’ is the latest software available to test moderation-mediation which follows the bootstrapping method.

Measures

The following tools were used:

1. MLQ (Bass & Avolio, 2004) is a 45-item question- naire (5-point) that identifies key aspects of leadership behaviour, namely transactional, transformational and laissez-faire leadership style as well as leader’s effec- tiveness. The first 36 items measure three leader- ship styles and the last nine items measure leader’s effectiveness. MLQ is a widely used tool to measure leadership styles, and many published studies have reported reliability and validity of the tool (Ackermann, Schepers, Lessing & Dannhauser 2000; Bass & Avolio, 1997; Yammarino & Bass, 1990). On the cur- rent sample, Cronbach alpha (a) was reported as 0.94 for transformational (20 items) and for transactional (12 items) as 0.54, lasseiz-faire (4 items) as 0.51 and leader’s effectiveness (9 items) as 0.90.

2. JAWS (Van Katwyk et al., 2000) is a 30-item (full version) and 20-item (short version) scale designed to assess people’s emotional reactions to their job on a 5-point scale. Internal consistency reliability estimates are available from at least three studies (Bruk-Lee & Spector, 2006; Spector, Fox, Goh & Bruursema, 2003; Van Katwyk, et al., 2000) using the different versions with heterogeneous working samples. On the current sample, Cronbach alpha (a) was reported to be 0.93.

3. Collective efficacy: A 15-item scale was developed to assess the collective efficacy of the teams to assess the team members’ efficacy on the recommend- ations based on considerable points of Karrasch (2003). In accordance with recommendations by Bandura and Adams (1977), the items were tailored to capture the essence of the team tasks. Responses are rated on a 5-point Likert scale. The inter-item reliability for this scale as reported by the author was 0.93. On the current sample, Cronbach alpha (a) was reported to be 0.96.

Results

The aim of the study was to explore the relationships among collective efficacy, leadership styles (transform- ational, transactional and laissez-faire), leader’s effective- ness and well-being and to examine the role of collective efficacy as the mediator between leadership styles, leader’s effectiveness and well-being. The sample was taken from the education industry, and mediated regression analysis was used to make inferences from the obtained data. As different constructs of the present study have different numbers of questions to assess them, all the obtained mean values for all the variables were divided by the number of items to obtain the scale values.

As is evident from Table 1, the lowest mean score was obtained for laissez-faire style, followed by transactional style, and the maximum mean value was for transform- ation style. Means for transformational and transactional leadership are 2.59 and 2.19, indicating that the scale response of ‘sometimes’ and that of laissez-faire is 0.71, indicating the response towards ‘once in a while’. These results imply that laissez-faire is the least-preferred style as compared to the other two styles for the participants of the current sample. Although transformational style appeared to be the most preferred style, there was higher variability in the scores (SD = 0.83) than that in transactional styles (SD = 0.49), indicating the high concentration of scores around the mean value in the latter. The mean values for collective efficacy and job affect are 3.90 and 3.84 (close to 4), indicating responses as ‘very confident’ whereas for leader’s effectivity, the mean value is 2.77 (or 3) which is towards a ‘fairly often’ response.

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Table 1. Mean and SD Values of 90 Employees from Education Management Industry

Variables Minimum Maximum Mean SD

Collective Efficacy 1.27 5 3.90 0.74 Transformational Leadership Style 0.50 4.42 2.59 0.83 Transactional Leadership Style 0.97 3.25 2.19 0.49 Laissez-faire Leadership Style 0.00 3.00 0.71 0.73 Leader’s Effectiveness 0.33 4.00 2.77 0.88 Job-related Well-being 2.63 4.8 3.84 0.58

Source: Result output by IBM SPSS.

Table 2. Correlation Among Collective Efficacy, Leadership Styles, Leader’s Effectiveness and Well-being

Variables 1 2 3 4 5 6

1. Collective Efficacy 1 2. Transformational Leadership Style 0.50* 1 3. Transactional Leadership Style 0.52* 0.72* 1 4. Laissez-faire Leadership Style –0.40* –0.52* –0.37* 1 5. Leader’s Effectiveness 0.50* 0.82* 0.64* –0.49* 1 0. 6. Well-being 0.55* 0.63* 0.53* –0.39* 0.61* 1

Source: Result output by IBM SPSS. Note: *p < 0.01.

The results show that transformational and transactional leadership styles were positively and significantly related to collective efficacy (p < 0.01), whereas laissez-faire leader- ship style was negatively related to collective efficacy (p < 0.01). Collective efficacy was significantly and posi- tively related to the leader’s effectiveness (p < 0.01) as well as with well-being (p < 0.01). Transformational and trans- actional leadership styles were positively related to each other (p < 0.01); however, both these dimensions were neg- atively related to laissez-faire leadership style (p < 0.01). And lastly, leader’s effectiveness was negatively correlated with laissez-faire leadership style (p < 0.01) and positively with well-being (p < 0.01).

It is evident from Table 3 that (a) collective efficacy significantly mediates the relationship between transac- tional style and leader’s effectiveness, Beta = 1.79, 95% boot strapping CI {0.40, 3.61}, representing medium effect size as K2 = 0.14, 95% boot strapping Ca CI {0.02, 0.23);

Table 3. Direct and Indirect Regression Coefficients for Leadership Styles (Predictor/s) and Leadership Effectiveness (Outcome Variables) Through Collective Efficacy

Predictor Variable

Mediating Variable

Outcome Variable

Direct Effect

Indirect Effect

Effect Size

Leadership Styles

Collective Efficacy (b)

Leadership Effectiveness (b) Leadership Styles and Leadership Effectiveness

LS & CE CE & LE Beta With Bootstrapping CI Kappa Square

Transformational 0.50* 1.13* 6.63*** b = 0.51, 95% CI (–0.13, 1.32} K2 = 0.10, 95% BCa CI {0.01, 0.21) Transactional 0.79* 2.25* 7.71*** b = 1.79, 95% CI {0.40, 3.61} K2 = 0.14, 95% BCa CI {0.02, 0.23) Laissez-faire 0.40* 3.61* 3.38*** b = –1.47, 95% CI {–2.79, –0.74} K2 = 0.15, 95% BCa CI {0.08, 0.27}.

Source: Result output by IBM SPSS. Note: *p < 0.05; **p < 0.01; ***p < 0.001. BCa= Bias Corrected and accelerated.

(b) however, collective efficacy failed to mediate the rela- tionship of transformational and laissez-faire styles with leadership effectiveness. In to make the mediation sig- nificant, it is necessary that bootstrapping confidence inter- vals should not contain zero (Field, 2013); and (c) all the three direct effect regression coefficients were significant.

Table 4 regression coefficients, the indirect effect and the bootstrapped confidence intervals of collective efficacy on transformational leadership style and well-being (a) It is observed that there is a significant indirect effect of trans- formational leadership style on well-being through collec- tive efficacy, Beta = 0.11, 95% bootstrapping CI {0.05, 0.19}. This represents high effect size as K2= 0.18, 95% boot strapping CI {0.09, 0.29). (b) There was a significant indirect effect of transactional leadership style on well- being through collective efficacy, b = 0.24, 95% CI {0.11, 0.38}. This again represents high effect size as K2= 0.20, 95% bootstrapping CI {0.10, 0.31). (c) However, the

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laissez-faire style again failed to mediate the relationship collective efficacy and well-being. (d) The direct effect of leadership styles on wellbeing was positive and significant except for laissez-faire style.

Discussion

The current study explored the direct and indirect linkages of collective efficacy and leader’s effectiveness with job- related well-being through three leadership styles. There are many ways to test indirect/mediation paths, the most recent one being the Hayes process mediation model (2012), which is used in the present research. Two hypoth- eses were formulated: one explored the direct relationship among the constructs while the second explored the indi- rect linkages among the constructs, three leadership styles being the mediators independently.

Table 1 depicted the descriptive statistics for all the con- structs used in the study. It is evident that among the three leadership styles, transformational style (M = 2.77) was the most dominant pattern, followed by transactional, and laissez-faire being the least-preferred style. This reflects a very promising kind of scenario as transformational and even in some cases transactional patterns have been associ- ated with positive organizational outcomes. The review indicates that the transformational leadership style is stim- ulating where there is certain transcendence in terms of self-interest leading towards the sharing of goals, shared mission and vision as well as the experience of positive affective states by the employees (Bono & Ilies, 2006). The results also show that the respondents have scored reason- ably high on collective efficacy and well-being. These two results have important implications as they are linked to many positive individual and organizational outcomes, reviewed above. Table 2 showed correlation coefficients among the constructs of the study. It was observed that collective efficacy is significantly related to all the three leadership styles undertaken in the study (p < 0.01), as well as with leader’s effectiveness and job-related affective well-being (p < 0.01), all the relationships being positive except the one with laissez-faire style. The results are along

Table 4. Direct and Indirect Regression Coefficients for Leadership Styles (Predictor/s) and Job-related Well-being (Outcome Variables) Through Collective Efficacy

Predictor Variable

Mediating Variable

Outcome Variable

Direct Effect Indirect Effect Effect Size

Leadership Styles

Collective Efficacy (b)

Job-related Affective Well-

being (b) Leadership Styles and Job-related Affective Well-being

LS and CE CE and Well-being Beta With Bootstrapping CI Kappa Square

Transformational 0.50* 0.25*** 0.32*** b = 0.11, 95/CI {0.05, 0.19} K2 = 0.18, 95% BCa CI {0.09, 0.29) Transactional 0.79* 0.30*** 0.38** b = 0.24, 95/CI {0.11, 0.38} K2 = 0.20, 95% BCa CI {0.10, 0.31) Laissez-faire 0.40* 0.37*** –0.16 b = 0.15, 95/CI {–0.25, –0.07} K2 = 0.19, 95% BCa CI {0.10, 0.29).

Source: Result output by IBM SPSS. Note: *p < 0.05; ** p < 0.01; *** p < 0 .001.

expected lines as many previous studies have reported these relationships (Krishnan, 2001, 2012; Nielsen & Daniel, 2012; Sadeghi & Pihie, 2012). Transactional lead- ership style was also found to be related to collective efficacy. Review from previous studies suggests that since a transactional leader is task oriented, there is a possibility of locating some commonalities on the basis of mutual tasks/goals between the leader and the followers (Howell & Avolio, 1993) which would pave the way for collective efficacy. Kahai, Sosik and Avolio (2003) found that transac- tional leadership style was directly linked to higher group efficacy. Rowold and Rohmann (2009) found that positive emotions are associated directly with both transactional and transformational leadership styles. There are studies link- ing well-being facets directly to the leader’s functioning/ effectiveness (Nguni, Sleegers & Denessen, 2006).

Laissez-faire leadership style was found to have negative relationships with all the variables of the study. Several studies report that this leadership style inversely impacts satisfaction and performance criteria, leading to experience of negative emotions and poor well-being (Judge & Piccolo, 2004), thereby reducing the efficiency of the employees. These results are also in sync with the existing research; therefore, the first hypothesis of the study is supported by the results obtained.

As mentioned earlier, the current research also explored indirect linkages among the variables. It is evident from the results presented in Table 3 that collective efficacy success- fully mediated the relationship between transactional style and leader’s effectiveness. Researchers in the past have reported that collective efficacy mediated the relationship between transformational leadership style (Ross & Gray, 2004) and effectiveness as well as well-being (Krishnan, 2012; Tabbodi & Prahallada, 2009). In a study by Walumbwa, Wang, Lawler, & Shi, (2004), collective efficacy mediated the relationship between transformational leadership and job attitudes. Chen and Bliese (2001) found that more positive and engaging leadership was associated with higher levels of collective efficacy among followers. Further supporting this contention, Sivasubramaniam, Murry, Avolio and Jung (2002) found that laissez-faire leadership style was

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negatively related to collective efficacy in intact teams. Collective efficacy was also found to be a mediator between leadership style and performance (Ross & Gray, 2006; Taggar & Seijts, 2003), supporting the argument that leader- ship style by itself may not be sufficient to produce desirable outcome variables, emphasizing that it is imperative to explore the indirect pathways through which leadership takes organizations towards success.

The results show that collective efficacy only mediated the relationship between transactional leadership style and leaders’ effectiveness. It could not produce mediation of transformational as well as laissez-faire styles on leaders’ effectiveness in this research. Collective efficacy is mani- fested through shared goals and collaborative decision- making in the organization (Maddux, 2002). It is shaped by four major sources: mastery experience, vicarious experi- ence, verbal persuasion and affective state (Bandura, 1997). Ross and Gray (2006) found support for transformational leadership as the mediator of teachers’ collective motiva- tion and effectiveness; however, there is a dearth of studies linking transactional style directly/indirectly to outcome variables. Like many other constructs, transformational— transactional leadership too evolved in the western culture where transformational style is believed to have an edge over transactional leadership style. However, Pauliene (2012) questioned this and found that in many collectivis- tic cultures such as Africa, Malaysia and United Arab of Emirates transactional leadership style is more relevant. In the Indian context, the famous task-nurturant leadership of Sinha (1995) is also a kind of transactional leadership in which the care and affection of the leader is contingent on the task performance. Although transformational leader- ship has always been credited with positive outcomes, it is not always needed, and especially in the everyday func- tioning of the organization, transactional style is more relevant (Hargis, Watt & Piotrowski, 2011). By invoking contingent reward as well as management by exception (active), leaders help the followers achieve mastery as well as vicarious experience. This, in turn, results in the experi- ence of positive affective states by the employees, resulting in collective efficacy, which eventually results in the perception of leaders’ effectiveness. As the present study has been conducted in the new ‘educational sector’ where work is organized around teams, in most cases leadership is about supervising the team members to attain the goals which are achieved through collaborative decision-making processes, which is the crux of collective efficacy (Maddux, 2002). This result partially supports the second hypothesis of the present research.

Results in Table 4 showed the direct and indirect pathways among leadership styles, collective efficacy and well-being. Collective efficacy significantly mediated the relationship of transactional and transformational styles with job-related affective well-being. The relationships were significant as shown by large effect sizes (kappa square). In most part, full-range leadership has been

conceived largely in the context of organization-specific outcomes (Warr, 1987); however, available data suggest that leadership has the potential to influence well-being (Kelloway & Barling, 2010), and transformational leader- ship in particular is linked to employees’ health and well- being (McKee, Driscoll, Kelloway & Kelley, 2011). In the recent past, indirect linkages of transformational relation- ship with well-being have also been explored (e.g., Munir, Nielsen & Carneiro, 2010). Many work characteristics such as meaningfulness (McKee et al., 2011), involvement (Nielsen, Randall, Yarker & Brenner, 2008), self-efficacy (Nielsen & Munir, 2009; Nielsen, Yarker, Randall & Munir, 2009), employee trust in leadership (Kelloway, Turner, Barling, & Loughlin, 2012) and so on have been explored in the past as mediating the relationship between transforma- tional leadership and well-being. The present study added a new construct (i.e., collective efficacy) as the mediator of the relationship between transformational leadership and well-being which is needed in the present-day team-based organizations. Transformational leadership has the potential to develop collective identity (Kanungo, 2001) and, in a similar vein, it can also be argued that some of the dimen- sions of transformational leadership would be instrumental in attaining collective efficacy. For example, individualized consideration is more relevant in the collectivistic culture (Bass, 1985), and this has implications for getting mastery and vicarious experience, which in turn would result in experiencing well-being at work.

Transformational leadership has almost shadowed all other forms of leadership, including transactional leader- ship, despite the fact that these two are complementary to each other rather than polar opposites (Bass, 1985). Bass et al. (2003) further argued that the context in which leaders and followers interact also determines the suit- ability of leadership styles. Transformational leadership is more suited when organizations are undergoing change, and during normal routine life transactional leadership is more suited. The results indicate that transactional leader- ship also influenced collective efficacy, which in turn influenced well-being of the employees. Interestingly, the effect size was stronger for transactional than for trans- formational one. Some of the dimensions of transactional leadership, such as contingent reward and management by exception (active), would result in getting mastery experi- ence and positive affect, which in turn influence well-being of the employees. India is a special case since both transac- tional and transformational leadership styles are well suited depending on the context of the organization (Biswas & Varma, 2011). These results provide support for the second hypothesis.

Conclusion and Implications

The present study explored thee leadership styles of MLQ taxonomy in the education industry and examined how these styles influence leadership effectiveness as well as

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well-being directly and also indirectly through collective efficacy. Standardized tools were used and their reliabili- ties were ascertained before proceeding with further data analysis. Data were analyzed using SPSS, where descrip- tive statistics were computed and indirect linkages were computed using the ‘process’ add-on for SPSS developed by Andrew Hayes. Transformational style was the most preferred style of leadership followed by transactional style; however, data were more dispersed in the case of transformational style, implying that some of the partici- pants used it very often and the rest very less. Other two variables, leaders’ effectiveness and well-being, were towards the higher side of the scoring. All the correlation coefficients were as per the expectations. Transactional style influenced effectiveness significantly through collec- tive efficacy; however, transformational style failed to do so. In the context of well-being, both transactional and transformational styles affected it indirectly through col- lective efficacy. Even here, transactional leadership had a better effect size than transformational one. These findings have important implications as transactional style emerged as the most important style, even better than transforma- tional style, in influencing both the outcome variables directly and indirectly. This implies that for leaders and followers, the context is important (Bass et al., 2003) in deciding which style would be best suited. In the early stages of an organization, transactional style is more rele- vant for effectiveness as roles and tasks are being struc- tured and things are still in the process as compared to when an organization has a long history. Moreover, in the changing times, when employees largely operate from a transactional psychological contract, the suitability of transformational style needs to be re-assessed.

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Authors’ bio-sketch

Kiran Sakkar Sudha ([email protected]) is an assistant professor of organizational behaviour and human resource management at IILM institute of Business and Management. She has interest in research and explorations in the area of industrial psychology and social contexts. Her core interest is in the area of personality and leader- ship. She is also a member of American Psychological Association.

M. G. Shahnawaz ([email protected]) is a professor of organizational behavior at Department of psychology Jamia Millia Islamia, New Delhi. He is well versed with research, statistics, industrial psychology and indigenous psychology. With more than two decades of experience and with numerous quality research contribu- tions, Prof. Shahnawaz is also a consultant to few Navratna and Maharatna companies.

Anam Farhat ([email protected]) is a Teacher Trainee Associate at IIM Calcutta. With practical experiences from both industry and academia, she intends to explore and challenge real life workplace setting and theories revolving workplace context.