Setting the Table: How Transformational Leadership Fosters Performance Information Use

Abstract

The article offers a theory of how leadership affects the implementation of management reforms. The central premise of this theory is that leadership can have important but easyto-miss indirect effects on organizational factors that shape reform outcomes. To test this question, we examine how transformational leadership influences the implementation of performance reforms, using performance information use as a dependent variable. Previous research suggests that leadership can affect how performance information is used among employees but underspecifies the theoretical mechanisms by which this influence occurs. This article develops a theoretical model that proposes that transformational leaders ''set the table'' for performance information use via a positive but indirect effect on two mediating factors, goal clarity and organizational culture. A structural equation model using selfreported performance information use as a dependent variable provides empirical evidence consistent with our theory.