Rally the troops or make the trains run on time: the relative importance and interaction of contingent reward and transformational leadership

Abstract

The positive association between transformational leadership and organizational and affective outcomes is well established in the literature. The relationship of contingent reward, a component of transactional leadership, to those outcomes and its additive and interactive relationship to transformational leadership is less well understood. In a study of 660 manufacturing workers working in 25 shop areas, transformational leadership and contingent reward had positive individual and additive impacts on supervisory and general satisfaction at both the individual and group level of analysis and on productivity at the group level. At the individual level of analysis, both satisfaction with supervision and overall satisfaction were enhanced by the interaction of contingent reward and transformational leadership operating together at certain levels. The operationalization of transformational leadership has contributed to the understanding of the inspirational and relationship aspects of leadership and contingent reward explains some, but not all, of the additional elements of successful leadership.