Nurturing overconfidence: The relationship between leader power,overconfidence and firm performance

This paper analyzes the relationship between leader power and overconfidence in the corporate context. Building on psychology research, we postulate that by activating self-serving cognition and illusion of control, the amount of power allocated to the leader of an organization positively influences the probability that he/she will exhibit overconfident beliefs. Using various measures of both formal and symbolic leader power we provide corroborating evidence for such endogeneous - power-based - origin of leader overconfidence. Then, we develop an empirical framework that allows to test the endogeneity-free effects of leader overconfidence on firm performance. Namely, we use a propensity score matching technique to construct a sample of reasonable counterfactuals (i.e., leaders in similar power-allocation conditions who do not exhibit overconfidence). As a result, we provide dissenting evidence about the effects of overconfidence, showing an economically and statistically significant positive influence of overconfidence on firm performance.     

The good leader

What are the traits of successful leaders and can they be applied to those of us in health care? Leaders must deal with conflict to get a group of people to move in the same direction. Successful leaders learn to have difficult conversations that increase understanding and morale and creatively deal with the inevitable interpersonal conflicts present in every organization made up of people. Another useful trait for a leader during uncertain and chaotic times is the ability to see things as they really are, rather than as we wish or believe them to be. Successful leaders are also usually optimists who level with their co-workers.     

The physician leader as logotherapist

Today's physicians feel helpless and angry about changing conditions in the medical landscape. This is due, in large part, to our postmodernist world view and the influence of corporations on medical practice. The life and work of existentialist psychiatrist Viktor Frankl is proposed as a role model for physicians to take back control of their profession. Physician leaders are in the best position to bring the teachings and insight of Frankl's logotherapy to rank-and-file physicians in all practice settings, as well as into the board rooms of large medical corporations. This article considers the spiritual and moral troubles of American medicine, Frankl's answer to that affliction, and the implications of logotherapy for physician organizations and leadership. Physician executives are challenged to take up this task.     

The entanglement of leader character and leader competence and its impact on performance

Whereas the micro- and macro-oriented leadership literatures have often studied leader competencies necessary for effective performance, the role of leader character in relation to competencies and performance has been to a large extent neglected. Our work seeks to shift the scholarly dialogue by introducing the concept of character-competence entanglement, which reflects the binding between character and competence over time. The highest degree of entanglement represents the deep and more persistent interconnection and mutually-reinforcing effect between highly-developed leader character and highly-developed leader competence, whereas in cases of low entanglement, character can be activated temporarily in a particular context to help strengthen the relationship between competence and performance. Our core proposition is that high character-competence entanglement will lead to extraordinary performance over time. In addition, we emphasize that relying on naturally-occurring learning opportunities and the processes of “learning-by-living” both outside and inside the organization will positively impact the development of character-competence entanglement.     

The role of vertical conflict in the relationship between leader self-enhancement and leader performance

Although studies have shown that inflated self-perceptions of transformational leadership behavior negatively affect leader performance, insight into the underlying processes explaining this relationship is lacking. The current study addresses this gap by identifying vertical conflict between leaders and subordinates as one such underlying process. Using a sample of 52 leaders supervising 259 subordinates, it was found that leader self-enhancement of transformational leadership behavior is significantly and positively related to vertical conflict about both task and relationship issues. Results further indicate that vertical task conflict rather than vertical relationship conflict mediates the negative relationship between leader self-enhancement and leader performance.     

Is a happy leader a good leader? A meta-analytic investigation of leader trait affect and leadership

Organizational scholars have long been concerned with identifying traits that differentiate effective leaders from ineffective leaders. Although there has been renewed interest in the role of emotions in leadership, there is currently no quantitative summary of leader trait affectivity and leadership. Thus, the current paper meta-analyzed the relationship between leader trait affectivity and several leadership criteria, including transformational leadership, transactional leadership, leadership emergence, and leadership effectiveness. Results show that leader positive affect is positively related to leadership criteria, whereas leader negative affect is negatively related to leadership criteria, and regression analyses indicate that leader trait affect predicts leadership criteria above and beyond leader extraversion and neuroticism. Additionally, mediational analyses reveal that the relationship between leader trait affect and leadership effectiveness operates through transformational leadership. Taken together, these results contribute to the literature on emotions and leadership by highlighting the role of leader affect as a meaningful predictor of leadership.     

The bright and dark sides of leader traits: A review and theoretical extension of the leader trait paradigm

The leader trait perspective is perhaps the most venerable intellectual tradition in leadership research. Despite its early prominence in leadership research, it quickly fell out of favor among leadership scholars. Thus, despite recent empirical support for the perspective, conceptual work in the area lags behind other theoretical perspectives. Accordingly, the present review attempts to place the leader trait perspective in the context of supporting intellectual traditions, including evolutionary psychology and behavioral genetics. We present a conceptual model that considers the source of leader traits, mediators and moderators of their effects on leader emergence and leadership effectiveness, and distinguish between perceived and actual leadership effectiveness. We consider both the positive and negative effects of specific “bright side” personality traits: the Big Five traits, core self-evaluations, intelligence, and charisma. We also consider the positive and negative effects of “dark side” leader traits: Narcissism, hubris, dominance, and Machiavellianism.     

Leader-member exchange and organizational citizenship behaviors: Contextual effects of leader power distance and group task interdependence

In this paper we explore the context of the relationship between leader-member exchange and organizational citizenship behaviors (OCB). We maintain that workgroup leader's power distance and the extent of task interdependence in the group exert cross-level effects on the LMX-OCB relationship. We assert that leader power distance attenuates the relationship between LMX and OCB, and this effect is stronger in workgroups with high degree of task interdependence. Results of hierarchical linear modeling analysis of data gathered from 245 employees nested in 54 workgroups supported our hypotheses. LMX-OCB relationship was weaker in workgroups led by high power distance leaders. Further, the three-way cross-level interaction between LMX, leader power distance and group task interdependence demonstrated that the tendency for LMX to have a stronger positive effect on OCB when leader power distance was low rather than high was more pronounced in high task interdependence teams.     

Assessment of leader problem-solving capabilities

We describe the development of and initial psychometric evidence for a set of five constructed response measures designed to assess complex problem-solving skills and knowledge expected to influence leadership. Structured (cued) and unstructured (uncued) problem solving scenarios intended to assess process skills associated with creative problem solving are presented first. Solution construction tasks developed to assess attention to constraints and characteristics in the broader problem context are presented next. Finally, social judgment tasks intended to assess understanding of people and social systems and a task sort to assess knowledge of leadership roles are presented. Preliminary evidence for the reliability and construct validity of these constructed response measures supports their efficacy in assessing skills that underlie effective organizational leadership.     

The depleted leader: The influence of leaders' diminished psychological resources on leadership behaviors

While much is understood about the outcomes of different leadership styles, less is known about the antecedents of leadership, particularly with regards to how leaders' own psychological well-being impacts leadership behaviors. Using conservation of resources theory as a framework, we investigated the relationship between leaders' depleted resources and their leadership behaviors. Conceptualizing depressive symptoms, anxiety, and workplace alcohol consumption as resource depletion, we predicted that depletion would be associated with lower levels of transformational leadership, and higher levels of abusive supervision, and when taken together, would further exacerbate these effects on leadership behaviors. In a study of 172 leader–subordinate pairs, leaders' depressive symptoms, anxiety, and workplace alcohol consumption separately predicted lower transformational leadership, and higher abusive supervision. Furthermore, partial support was found for an exacerbating effect on transformational leadership and abusive supervision.     

The influence of leader core self-evaluation on follower reports of transformational leadership

The role of leader core self-evaluations (CSE) was investigated for its influence on follower perceptions of transformational leadership (TFL) dimensions in a sample of 464 employees and 150 leaders from three Chinese organizations. As hypothesized, after controlling for leaders' and followers' demographic variables and modeling fixed-effects to account for the potential impact of omitted variables, we found that leader CSE was significantly and positively related to follower perception of leader TFL. The result enhances the understanding of TFL antecedents.     

How leader role identity influences the process of leader emergence: A social network analysis

Contemporary theories on leadership development emphasize the importance of having a leader identity in building leadership skills and functioning effectively as leaders. We build on this approach by unpacking the role leader identity plays in the leader emergence process. Taking the perspective that leadership is a dynamic social process between group members, we propose a social network-based process model whereby leader role identity predicts network centrality (i.e., betweenness and indegree), which then contributes to leader emergence. We test our model using a sample of 88 cadets participating in a leadership development training course. In support of our model, cadets who possess a stronger leader role identity at the beginning of the course were more likely to emerge as leaders. However this relationship was only mediated by one form of network centrality, indegree centrality, reflecting one's ability to build relationships within one's group. Implications for research and practice are discussed.     

Professionalism and the physician leader

The perception of the well-respected, knowledgeable, empathetic physician of early 20th century medicine is slowly being eroded in American society today. Consider the causes of the breakdown and how to restore the image.     

Know thy self,know thy leader: Contributions of a pattern-oriented approach to examining leader perceptions

This study investigated how patterns of traits in self and ideal leader profiles were related to one another, beyond the individual effects of each trait. Latent profile analysis (LPA) was used to identify and describe profiles of self leader and ideal leader perceptions. Four profiles for self leader perceptions (Prototypical, Laissez-Faire, Narcissistic, Anti-Prototypical) and four profiles for ideal leader perceptions (Prototypical, Laissez-Faire, Autocratic, Anti-Prototypical) were identified. Additional analyses examined the association between self and ideal leader profiles; gender, leadership self efficacy, and narcissism were added to the model as predictors of that association. Prototypical and Laissez-Faire self leaders tended to prefer an ideal leader who was similar to themselves, whereas Narcissistic and Anti-Prototypical self leaders had more diffuse preferences in ideal leaders. Gender, leadership self efficacy, and narcissism were only associated with self leader profiles. Results support, yet contribute beyond, previous findings for the similarity hypothesis.     

I can,I am: Differential predictors of leader efficacy and identity trajectories in leader development

Despite significant attention devoted to outcomes of formal leadership training, little is known about how individuals develop during these programs. The current study examined developmental trajectories of leader efficacy and identity, two proximal outcomes supporting leadership effectiveness, in a six-week leadership training course (N = 240). Testing competing predictions between developmental readiness and developmental need perspectives, we examined whether learning goal orientation (LGO) and motivation to lead (MTL) predicted development of trainees' leader self-views. Latent growth modeling results revealed leader efficacy developed linearly, whereas leader identity developed quadratically (i.e., positive change with slowing growth over time). Results for leader efficacy supported the developmental need perspective, as individuals lower on affective MTL exhibited greater changes to their leader efficacy, which was further moderated by LGO. In contrast, individuals higher and lower on LGO developed equally on leader identity, albeit via different trajectories. Implications for leadership theory and practice are discussed.