Do similarities or differences between CEO leadership and organizational culture have a more positive effect on firm performance? A test of competing predictions.

This study examines the nature of the interaction between CEO leadership and organizational culture using 2 common metathemes (task and relationship) in leadership and culture research. Two perspectives, similarity and dissimilarity, offer competing predictions about the fit, or interaction, between leadership and culture and its predicted effect on firm performance. Predictions for the similarity perspective draw upon attribution theory and social identity theory of leadership, whereas predictions for the dissimilarity perspective are developed based upon insights from leadership contingency theories and the notion of substitutability. Hierarchical regression results from 114 CEOs and 324 top management team (TMT) members failed to support the similarity hypotheses but revealed broad support for the dissimilarity predictions. Findings suggest that culture can serve as a substitute for leadership when leadership behaviors are redundant with cultural values (i.e., they both share a task- or relationship-oriented focus). Findings also support leadership contingency theories indicating that CEO leadership is effective when it provides psychological and motivational resources lacking in the organization's culture. We discuss theoretical and practical implications and delineate directions for future research. (PsycINFO Database Record

[1]  R. J. House,et al.  Does Leadership Matter? CEO Leadership Attributes and Profitability under Conditions of Perceived Environmental Uncertainty. , 2001 .

[2]  D. S. Derue,et al.  Leadership in Teams: A Functional Approach to Understanding Leadership Structures and Processes , 2010 .

[3]  D. van Knippenberg,et al.  Leader self-sacrifice and leadership effectiveness: the moderating role of leader prototypicality. , 2005, The Journal of applied psychology.

[4]  Cheri Ostroff,et al.  Multiple perspectives of fit in organizations across levels of analysis. , 2007 .

[5]  L. Lambert.  Promised and delivered inducements and contributions: an integrated view of psychological contract appraisal. , 2011, The Journal of applied psychology.

[6]  R. Dodhia.  A Review of Applied Multiple Regression/Correlation Analysis for the Behavioral Sciences (3rd ed.) , 2005 .

[7]  Yair Berson,et al.  CEO values, organizational culture and firm outcomes. , 2008 .

[8]  Transformational Leadership and Organizational Culture: Toward Integrating a Multilevel Framework , 2011 .

[9]  Robert E. Hoskisson,et al.  Strategic Management: Competitiveness and Globalization , 1994 .

[10]  Hui Wang,et al.  CEO leadership behaviors, organizational performance, and employees' attitudes , 2011 .

[11]  C. Kenneally.  The forgotten ones , 2012 .

[12]  B. Bass,et al.  The Bass handbook of leadership : theory, research, and managerial applications , 2008 .

[13]  B. E. Partridge,et al.  The Nature of Managerial Work , 1974 .

[14]  David G. Bowers,et al.  Predicting Organizational Effectiveness with a Four-Factor Theory of Leadership , 1966 .

[15]  W. P. Barnett,et al.  Work group demography, social integration, and turnover. , 1989 .

[16]  Jeffrey D. Yergler.  Organizational Culture and Leadership, 4th ed. , 2012 .

[17]  Daniel T. Holt,et al.  Forgotten but not gone: an examination of fit between leader consideration and initiating structure needed and received. , 2012, The Journal of applied psychology.

[18]  Daniel A. Newman.  Missing data techniques and low response rates: The role of systematic nonresponse parameters , 2008 .

[19]  Mason A. Carpenter,et al.  Upper Echelons Research Revisited: Antecedents, Elements, and Consequences of Top Management Team Composition , 2004 .

[20]  H. Kelley.  The processes of causal attribution. , 1973 .

[21]  Gary N. Burns,et al.  Leader–Culture Fit , 2013 .

[22]  Sidney Walter Finkelstein,et al.  Why Smart Executives Fail: And What You Can Learn from Their Mistakes , 2003 .

[23]  D. Mumby.  Cultures in Organizations: Three Perspectives , 1994 .

[24]  R. Charan,et al.  Why CEOs fail. , 1999, Fortune.

[25]  Gordon W. Cheung,et al.  Evaluating Goodness-of-Fit Indexes for Testing Measurement Invariance , 2002 .

[26]  B. Hesketh,et al.  Person–Environment Fit , 2015 .

[27]  N. Ashkanasy,et al.  Handbook of Organizational Culture and Climate , 2000 .

[28]  A. Halpin.  Manual for the leader behavior description questionnaire , 1957 .

[29]  Jennifer A. Chatman,et al.  PEOPLE AND ORGANIZATIONAL CULTURE: A PROFILE COMPARISON APPROACH TO ASSESSING PERSON-ORGANIZATION FIT , 1991 .

[30]  Ronald K. Mitchell,et al.  Who Matters to Ceos? An Investigation of Stakeholder Attributes and Salience, Corpate Performance, and Ceo Values , 1999 .

[31]  Stephen E. Humphrey,et al.  TRAIT AND BEHAVIORAL THEORIES OF LEADERSHIP: AN INTEGRATION AND META-ANALYTIC TEST OF THEIR RELATIVE VALIDITY , 2011 .

[32]  Robert G. Lord,et al.  Leadership theory and research in the new millennium: Current theoretical trends and changing perspectives , 2014 .

[33]  R. J. House,et al.  A Path-Goal Theory of Leader Effectiveness , 1971 .

[34]  S. Thompson.  Social Learning Theory , 2008 .

[35]  F. Heider.  The psychology of interpersonal relations , 1958 .

[36]  M. Lubatkin,et al.  The impact of transformational CEOs on the performance of small- to medium-sized firms: does organizational context matter? , 2008, The Journal of applied psychology.

[37]  Sabrina Eberhart,et al.  Applied Missing Data Analysis , 2016 .

[38]  Celeste P.M. Wilderom,et al.  A longitudinal study of the effects of charismatic leadership and organizational culture on objective and perceived corporate performance. , 2012 .

[39]  A. Kinicki,et al.  Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework's theoretical suppositions. , 2011, The Journal of applied psychology.

[40]  Neal M. Ashkanasy,et al.  Organizational culture and climate , 2002 .

[41]  John M. Jermier,et al.  Substitutes for leadership: Their meaning and measurement , 1978 .

[42]  Kevin C. Stagl,et al.  What type of leadership behaviors are functional in teams? A meta-analysis , 2006 .

[43]  Thomas D. Taber,et al.  A Hierarchical Taxonomy of Leadership Behavior: Integrating a Half Century of Behavior Research , 2002 .

[44]  Chester A. Schriesheim,et al.  Differences in Factor Structure across Three Versions of the Ohio State Leadership Scales. , 1975 .

[45]  A. Thakor,et al.  Competing Values Leadership: Creating Value in Organizations , 2006 .

[46]  S. Sackmann.  Culture and Subcultures: An Analysis of Organizational Knowledge , 1992 .

[47]  R. van Dick,et al.  Substitutes for procedural fairness: prototypical leaders are endorsed whether they are fair or not. , 2009, The Journal of applied psychology.

[48]  Mandy Berg,et al.  New Patterns Of Management , 2016 .

[49]  L. Festinger,et al.  A Theory of Cognitive Dissonance , 2017 .

[50]  R. J. House,et al.  Path-goal theory of leadership: Lessons, legacy, and a reformulated theory , 1996 .

[51]  H. Skipton Leonard,et al.  The Wiley-Blackwell Handbook of the Psychology of Leadership, Change, and Organizational Development , 2013 .

[52]  J. Schafer,et al.  Missing data: our view of the state of the art. , 2002, Psychological methods.

[53]  K. Cameron,et al.  Diagnosing and Changing Organizational Culture: Based on the Competing Values Framework , 1999 .

[54]  L. Harris,et al.  Leadership style, organizational culture and performance: empirical evidence from UK companies , 2000 .

[55]  Ralph M. Stogdill,et al.  Manual for the leader behavior description questionnaire - Form XII , 1963 .

[56]  Robert R. Hirschfeld,et al.  Voluntary survey completion among team members: implications of noncompliance and missing data for multilevel research. , 2013, The Journal of applied psychology.

[57]  H. Kelley.  Attribution theory in social psychology , 1967 .

[58]  K. Bollen.  A New Incremental Fit Index for General Structural Equation Models , 1989 .

[59]  Cheri Ostroff.  Person-Environment Fit in Organizational Settings , 2012 .

[60]  Gregory E. Prussia,et al.  A motivational investigation of group effectiveness using social-cognitive theory. , 1996 .

[61]  J. Edwards,et al.  Complementary and supplementary fit: a theoretical and empirical integration. , 2004, The Journal of applied psychology.

[62]  Murray R. Barrick,et al.  Collective organizational engagement: : Linking motivational antecedents, strategic implementation, and firm performance , 2015 .

[63]  Katherine A. Lawrence,et al.  Behavioral complexity in leadership: The psychometric properties of a new instrument to measure behavioral repertoire ☆ , 2009 .

[64]  John Rohrbaugh,et al.  A Spatial Model of Effectiveness Criteria: Towards a Competing Values Approach to Organizational Analysis , 1983 .

[65]  J. M. Beyer,et al.  Cultural Leadership in Organizations , 1991 .

[66]  Michael A. Hogg,et al.  A Social Identity Theory of Leadership , 2001 .

[67]  Christian J. Resick,et al.  Systematic variation in organizationally-shared cognitive prototypes of effective leadership based on organizational form. , 2006 .

[68]  L. James,et al.  Estimating within-group interrater reliability with and without response bias. , 1984 .

[69]  Zeki Simsek,et al.  Modeling the Multilevel Determinants of Top Management Team Behavioral Integration , 2005 .

[70]  Elizabeth George,et al.  APA Handbook of Industrial and Organizational Psychology , 2010 .

[71]  Tony Simoms,et al.  Behavioral Integrity: The Perceived Alignment Between Managers' Words and Deeds as a Research Focus , 2002, Organ. Sci..

[72]  Arthur P. Brief,et al.  Productivity, supervision and morale in an office situation , 1950 .

[73]  Maria Simosi,et al.  Organizational culture and transformational leadership as predictors of business unit performance , 2006 .

[74]  Fred O. Walumbwa,et al.  Leadership: current theories, research, and future directions. , 2009, Annual review of psychology.

[75]  Jacob Cohen,et al.  Applied multiple regression/correlation analysis for the behavioral sciences , 1979 .

[76]  Aneil K. Mishra,et al.  Toward a theory of organizational culture and effectiveness. , 1995 .

[77]  Daan van Knippenberg,et al.  License to Fail? How Leader Group Prototypicality Moderates the Effects of Leader Performance on Perceptions of Leadership Effectiveness , 2008 .

[78]  F. Fiedler.  Research on Leadership Selection and Training: One View of the Future , 1996 .

[79]  John E. Mathieu,et al.  A Temporally Based Framework and Taxonomy of Team Processes , 2001 .

[80]  E. A. Fleishman,et al.  Taxonomic efforts in the description of leader behavior: A synthesis and functional interpretation , 1991 .

[81]  P. Hanges,et al.  A network model of organizational climate: Friendship clusters, subgroup agreement, and climate schemas , 2008 .

[82]  D. Waldman,et al.  Do Humble CEOs Matter? An Examination of CEO Humility and Firm Outcomes , 2018 .

[83]  D. C. Feldman,et al.  The Development and Enforcement of Group Norms , 1984 .

[84]  J. Covin,et al.  CEO founder status and firm financial performance , 2000 .

[85]  Ronald F. Piccolo,et al.  The forgotten ones? The validity of consideration and initiating structure in leadership research. , 2004, The Journal of applied psychology.

[86]  Zhen Zhang,et al.  CEO grandiose narcissism and firm performance: The role of organizational identification ☆ , 2014 .

[87]  F. Fiedler,et al.  Leadership theory and research: A report of progress. , 1994 .

[88]  D. Parfit,et al.  On What Matters , 2011 .

[89]  M. Uhl‐Bien,et al.  Relational Leadership Theory: Exploring the social processes of leadership and organizing , 2006 .

[90]  Lena Osterhagen,et al.  Multiple Imputation For Nonresponse In Surveys , 2016 .

[91]  Jennifer A. Chatman,et al.  Culture as social control: Corporations, cults, and commitment. , 1996 .

[92]  Albert A. Cannella,et al.  Strategic Leadership: Theory and Research on Executives, Top Management Teams, and Boards , 2008 .

[93]  Nandu J. Nagarajan,et al.  Does Ceo Charisma Matter? An Empirical Analysis Of The Relationships Among Organizational Performance, Environmental Uncertainty, And Top Management Team Perceptions Of Ceo Charisma , 2006 .

[94]  Benjamin M. Galvin,et al.  CEO Servant Leadership: Exploring Executive Characteristics and Firm Performance , 2012 .