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Vision
20(2) 111120
2016 MDI
SAGE Publications
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DOI: 10.1177/0972262916637260
http://vision.sagepub.com
Leadership Styles, Leaders 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, leaders 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], 219230) 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, Leaders 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: [emailprotected]
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 ones 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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112 Vision 20(2)
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, leaders 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 groups 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 erastrait, 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
Sudha et al. 113
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), leaders effectiveness and
well-being.
H2: Collective efficacy would mediate the relationship
between three leadership styles (transformational,
transactional and laissez-faire) and leaders 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 sectors 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
114 Vision 20(2)
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 masters 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), leaders 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 leaders effec-
tiveness. The first 36 items measure three leader-
ship styles and the last nine items measure leaders
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
leaders 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 peoples 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), leaders effective-
ness and well-being and to examine the role of collective
efficacy as the mediator between leadership styles, leaders
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 leaders effectivity, the mean value is 2.77 (or 3) which
is towards a fairly often response.
Sudha et al. 115
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
Leaders 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, Leaders 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. Leaders 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 leaders 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, leaders 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 leaders 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 order 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
116 Vision 20(2)
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 leaders 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 leaders 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 leaders 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 leaders 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
Sudha et al. 117
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
