Transformational and Transactional Leadership in Virtual and Physical Environments

Abstract

Transformational and transactional leadership in both physical (i.e., face-to-face) and virtual settings were examined in a laboratory experiment. Leadership style (transformational or transactional) and group setting (face-to-face, immersive virtual environment, or intercom) were manipulated experimentally for three-person ad hoc work groups. Results indicated that, compared to transactional leadership, transformational leadership was associated with decreases in quantitative performance but increases in qualitative performance, leadership satisfaction, and group cohesiveness. Contrary to expectations, neither self- nor collective efficacy mediated the performance effects of leadership style; trust, however, appeared to play an important mediational role. Group performance and cohesiveness were similar across group settings; however, group members were most satisfied with their leader when interacting face-to-face. The theoretical and practical implications of these findings are discussed.