APPLIED PSYCHOLOGY: AN INTERNATIONAL REVIEW, 2007, 56 (2), 212–230

doi: 10.1111/j.1464-0597.2006.00241.x

Leadership, Individual Differences, and Work-

WALUMBWA
Original
LEADERSHIP
Blackwell
Oxford,
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related Attitudes: A Cross-Culture Investigation

Fred O. Walumbwa*
The Arizona State University, USA

John J. Lawler
University of Illinois at Urbana-Champaign, USA

Bruce J. Avolio
University of Nebraska, USA

This study builds on previous exploratory research (Walumbwa & Lawler,

2003) that examined allocentrism as a moderator of transformational leader-
ship—work-related attitudes and behaviors. Based on survey data collected
from 825 employees from China (n = 213), India (n = 210), Kenya (n = 159),
and the US (n = 243), we found that individual differences moderated the
relationships between leadership and followers’ work-related attitudes. Speci-
fically, allocentrics reacted more positively when they viewed their managers
as being more transformational. Idiocentrics reacted more positively when
they rated their managers as displaying more transactional contingent reward
leadership. The pattern of results was stronger for transformational leadership
in more collectivistic cultures among allocentrics and stronger among idiocen-
trics in individualistic cultures for transactional contingent reward leadership.
Implications of these findings for practice and research are discussed.

Cette recherche se situe dans le prolongement de travaux exploratoires antérieurs

(Walumbwa & Lawler, 2003) qui ont étudié l’allocentrisme comme régulateur
de la relation entre le leadership transformationnel et les conduites et attitudes
relevant du travail. Nous avons constaté, à partir de données d’enquête recueillies
auprès de 825 salariés chinois (n = 213), indiens (n = 210) kényens (n = 159)
et américains (n = 243), que les différences individuelles régulaient les relations
entre le leader et les attitudes des suiveurs liées au travail. Plus particulièrement,

* Address for correspondence: Fred O. Walumbwa, School of Global Management and

Leadership, The Arizona State University, P.O. Box 37100, Phoenix, AZ 85069-7100, USA.
Email: [email protected]
This research was partially supported by a grant from the Illinois Center for International
Business Education Research at the University of Illinois Urbana Campus and University
Research Board. We thank Michele J. Gelfand and anonymous reviewers for their constructive
and thoughtful comments.

© 2007 The Authors. Journal compilation © 2007 International Association of Applied

Psychology. Published by Blackwell Publishing, 9600 Garsington Road, Oxford OX4 2DQ,
UK and 350 Main Street, Malden, MA 02148, USA.
 LEADERSHIP AND INDIVIDUAL DIFFERENCES 213
les allocentriques réagissaient plus positivement quand ils percevaient leurs
managers comme étant plutôt transformationnel. Les égocentriques réagissaient
plus positivement quand ils trouvaient que leurs managers présentaient plutôt
un leadership transactionnel offrant des récompenses appropriées. La con-
figuration des résultats parle en faveur du leadership transformationnel pour
les allocentriques dans les cultures à tendance communautaire et en faveur du
leadership transactionnel pour les égocentriques dans les cultures individualistes.
On réfléchit aux implications de ces résultats pour la recherche et la pratique.

INTRODUCTION
Recent cross-cultural leadership research has focused on examining contex-
tual factors that influence the effectiveness of transformational and trans-
actional leadership. The underlying premise for this research is that the
relationship between transformational (transactional) leadership and fol-
lowers’ attitudes will be moderated by the cultural context (Gelfand, Bhawuk,
Nishi, & Bechtold, 2004).
A key cultural moderator that has received considerable attention in the
leadership literature has been what Hofstede (1980) called the individual-
ism–collectivism dimension. Jung and Avolio (1999) examined the moderating
effects of individualism and collectivism on responses to transformational
and transactional leadership in a laboratory experiment. Their results showed
that collectivists working with a transformational leader generated more
ideas as opposed to individualists, who generated more ideas with a trans-
actional leader. Jung and Avolio (1999) concluded that individual differences
may have affected the different levels of motivation and performance observed
in their study.
Pillai and Meindl (1998) examined the extent to which the emergence of
charismatic leadership was a function of contextual factors such as work unit,
collectivism, and crisis. Their results showed that organic structure and collec-
tivistic orientation were positively associated with the emergence of charismatic
leadership. More recently, in a 62-country study referred to as the GLOBE
project researchers reported that ratings of transformational leadership
were associated with organisational-level collectivism (Gelfand et al., 2004).
Yukl (1999) has suggested that to improve our understanding of norma-
tive models of leadership such as transformational and transactional, future
research would need to focus on potential moderators, including follower
characteristics. For example, Bono and Judge (2004) have shown that extra-
version is the most consistent correlate of ratings of leadership across
settings and leadership criteria (i.e. leader emergence and leadership effec-
tiveness). Lim and Ployart (2004) reported that neuroticism and agreeable-
ness were negatively related to ratings of transformational leadership.
Without taking into consideration individual differences among followers,
research on transactional and transformational leadership, especially across

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cultures, will likely fall short of fully explaining the linkages between leader-
ship, followers, and performance outcomes.
Among followers’ individual differences, allocentrism (i.e. viewing oneself
in terms of the in-groups to which one belongs) and idiocentrism (i.e. view-
ing oneself as the basic social unit where individual goals have primacy over
in-group goals) may play an important role in predicting how followers
respond to different leadership styles/orientations (Triandis, Chan, Bhawuk,
Iwao, & Sinha, 1995). Yet, despite their potential relevance to explaining
follower behavior (Triandis et al., 1995), there is only one study that has
directly linked these orientations to transformational leadership and work-
related outcomes. Walumbwa and Lawler (2003), using data collected from
China, India, and Kenya, examined the moderating effect of allocentrism
(referred to as collectivism at the group level). Walumbwa and Lawler
reported that transformational leadership explained a greater proportion of
variance in organisational commitment, satisfaction, and withdrawal behav-
iors for those scoring higher on allocentrism.
One drawback to the Walumbwa and Lawler (2003) study was that it
focused on one individual difference—allocentrism, one style of leader-
ship—transformational, and was restricted to participants coming from pre-
dominantly collectivistic cultures. Walumbwa and Lawler (2003) acknowledged
that, “one reason that we did not show a strong moderating effect by cul-
ture might be that the range of cultural values could have been restricted
since our sample was drawn from inherently collectivistic cultures” (p.
1098). Lam, Chen, and Schaubroeck (2002) argued that allocentrism and
idiocentrism may have meaningful effects on individual behavior/reactions/
performance irrespective of societal boundaries.
This study was designed to extend previous work reported by Walumbwa
and Lawler (2003). Specifically, we examined the extent to which allocen-
trism and idiocentrism moderated the relationships between transforma-
tional and transactional contingent reward leadership with organisational
commitment and satisfaction with one’s supervisor, and explored the extent
to which those relationships vary as a function of societal culture.
Our rationale for including both transformational and transactional con-
tingent reward leadership goes back to Bass’s (1985) original position on his
theory, where he suggested that individuals who are more concerned for
rules, who are independent, high in status, and rational may be less likely to
respond positively to transformational versus transactional leadership style.
Following his arguments, individual differences may augment or weaken the
receptivity an individual has to transformational and transactional leader-
ship style.
Compared with the strong and still growing research base on transforma-
tional leadership (see Judge & Piccolo, 2004), there has been surprisingly
little empirical research on potential moderators of transactional contingent

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 LEADERSHIP AND INDIVIDUAL DIFFERENCES 215
reward leadership as it relates to work-related attitudes, behaviours, and
outcomes (see Howell & Hall-Merenda, 1999, for an exception). This has
prompted researchers to call for more research identifying the potential
moderators of transactional contingent reward leadership (Howell & Hall-
Merenda, 1999; Yukl, 1999).
In addition to focusing on transactional contingent reward leadership and
idiocentrism, we also included US participants in our data collection scheme.
The inclusion of the US participants provided for a more individualistic
culture, while also allowing us to extend the external validity of our study to
a broader array of countries based on level of economic development. Finally,
and perhaps the most important extension and contribution over previous
work by Walumbwa and Lawler (2003) was our focus on exploring the
extent to which societal values or norms influence the way transformational
and transactional leadership are moderated by individual differences. We set
out here to examine both the main and interactive effects of societal culture
and individual differences in terms of important organisational outcomes.

THEORETICAL BACKGROUND AND HYPOTHESES

Although Hofstede (1980) conceptualised individualism–collectivism as a
cultural continuum, recent work suggests that these two constructs are inde-
pendent and can both coexist in individuals in varying degrees as well as in
all societies (Schwartz, 1994). These constructs can therefore be measured
in terms of representing individual differences (Schwartz, 1994; Triandis,
1995). Specifically, Triandis and Gelfand (1998) suggested that the crossing
of individualism and collectivism with power distance produces four distinct
dimensions of individuals, namely: horizontal collectivism, vertical collectiv-
ism, horizontal individualism, and vertical individualism. At the individual
level, these variables are called allocentrism and idiocentrism (Triandis,
Leung, Villareal, & Clack, 1985).
Triandis (1995) has argued that individual values specify modes of behav-
ior that are socially acceptable, serve as normative regulatory guides for
individuals, and prescribe the guiding principles and values in one’s life.
Triandis (1995) further suggests that values influence the domain of what
constitutes normative behavior, defines acceptable roles for individuals within
social structures, and prescribes guiding principles and values in one’s life.
As a result, individual values specify how one is influenced and influences
including how leadership may be perceived and evaluated. Extending earlier
work, we suggest that how the leader’s style is perceived and how it affects
followers depends in part on how much the style is linked to the follower’s
individual value orientation.
We expect individual differences to play a critical role in the way indi-
viduals respond to different leadership styles. Implicit leadership theory

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suggests that perceptions of leadership are based on hierarchically organised

cognitive prototypes that help individuals interpret leadership styles that are
compatible with their own cultural values/orientations (Lord, Foti, & De
Vader, 1984). For example, people process information based on their pro-
totypes of leadership; that is, the more a person perceives a leadership style
as being similar to his or her prototype of an effective leader, the more he
or she should respond more positively and in a more accepting manner to
that leader’s style.
Prior literature suggests that people’s implicit theories are to some degree
individually based. For example, cultural congruence theory (House, Wright,
& Aditya, 1997) suggests that behaviors consistent with particular values
will be viewed as more acceptable and effective than behaviors representing
conflicting values. House et al. (1997) argued that a violation of individual
norms by leaders will result in dissatisfaction on the part of followers, and
at times lower performance. Thus, because individual predispositions such
as one’s values are thought to signal individuals’ preferences for certain
things such as leadership style, it seems likely that these individual differ-
ences could influence individuals’ ratings of transformational and trans-
actional contingent reward leadership and their relationship to outcomes/
attitudes.

Transformational and Transactional Contingent

Reward Leadership
Here we focus on transformational and transactional contingent reward
leadership because previous empirical studies have demonstrated that both
leadership styles have a positive relationship with follower performance
across a broad range of settings (Judge & Piccolo, 2004). By transactional
contingent reward leadership we refer to “leader behaviors focused on clarify-
ing role and task requirements and providing followers with material or
psychological rewards contingent on the fulfillment of contractual obliga-
tions” (Antonakis, Avolio, & Sivasubramaniam, 2003, p. 265), which would
be more congruent with individuals having an idiocentric orientation.
Allocentrics are said to value and nurture group relationships and define
themselves on the basis of in-group membership, striving to maintain a
harmonious interdependence with their in-group members (Chen, Chen, &
Meindl, 1998). Such individuals see the individual self as being an integral
part of the group they belong to, and therefore are more likely to transcend
their self-interests and work towards common goals (Triandis, 1995). For
allocentrics, equality, serving, and sacrificing for the good of the group are
considered some of the most important aspects of life and satisfaction.
It seems likely that individuals who score higher on allocentrism may
be more receptive to transformational leadership because such leaders

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 LEADERSHIP AND INDIVIDUAL DIFFERENCES 217
emphasise the importance of each individual’s contribution to the good of
the group and its accomplishments by raising their awareness of the importance
and value of group outcomes (Bass, 1998). Such leaders work to transform
the needs and values of followers from self to collective interests, causing
followers to be more committed to the overall mission. As a result, allocen-
trics are expected to embrace transformational leadership more readily.
Recent findings provide some support for this assertion, in that allocentrism
was found to moderate the relationship between participative decision-making
and performance (Lam et al., 2002). Thus, we hypothesise:

Hypothesis 1: Individuals who are more (less) allocentric will respond more
(less) favorably to transformational leadership, such that the relationship
between transformational leadership and (a) organisational commitment and
(b) satisfaction with supervisor will be more (less) positive.

Since transactional contingent reward leadership emphasises exchanges

between the leader and follower that encourage individual competition,
autonomy, and personal achievement being tied to extrinsic rewards based
on performance (Bass, 1985), we expect this leadership orientation to be
inconsistent with the individual values of allocentrics. Thus, we hypothesise:

Hypothesis 2: Individuals who are more (less) allocentric will respond more
(less) favorably to transactional contingent reward leadership, such that the
relationship between contingent reward leadership and (a) organisational com-
mitment and (b) satisfaction with one’s supervisor will be less (more) positive.

Leadership, Idiocentrism, and Work Attitudes

Idiocentrics view the individual as the most basic unit of social perception
and give priority to individual over in-group goals (Triandis, 1995). Idiocen-
trics value independence, autonomy, and personal achievement, and place
less emphasis on the importance of their roles in groups (Markus &
Kitayama, 1991). This leads idiocentrics to be motivated to satisfy their self-
interests and personal goals oftentimes at the expense of group interests and
goals (Triandis, 1995). Thus, we expect individuals who are more idiocentric
will be less receptive to a leadership style that emphasises the importance of
the group’s collective identity. Thus, because such leaders strive to foster a
group-based focus, it may be viewed as a less satisfying and less effective
style by idiocentrics. Thus,

Hypothesis 3: Individuals who are more (less) idiocentric will respond less
(more) favorably to transformational leadership, such that the relationship
between transformational leadership and (a) organisational commitment and
(b) satisfaction with supervisor will be less (more) positive.

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Because idiocentrics tend to promote their own welfare over the interests
of their group (Triandis, 1995), such individuals are likely to be more moti-
vated to satisfy their own self-interests and personal goals. Transactional
contingent reward leadership is based on satisfying followers by offering
individual rewards commensurate with their effort and performance (Bass,
1998). Specifically, Bass (1998) described motivation to work in a contin-
gent reward culture as “a matter of trade-offs of worker effort in exchange
for rewards” (p. 65). We therefore suggest that idiocentrics will be more
receptive to contingent reward leadership, because such leader behaviors
emphasise clarity of goals and rewards associated with successful completion
of tasks (Bass, 1985). Thus,

Hypothesis 4: Individuals who are more (less) idiocentric will respond more
(less) favorably to contingent reward leadership, such that the relationship
between contingent reward leadership and (a) organisational commitment
and (b) satisfaction with supervisor will be more (less) positive.

Leadership, Individual Differences, and Country Values

Robert and Wasti (2002) described the rationale for measuring organisa-
tional culture along the dimensions of individualism and collectivism, and
evaluated the construct validity of a scale based on factor analysis as well
as observed relationships at the individual level (in terms of person–organ-
isation fit), and at the organisational level of analysis. The authors found
that idiocentrism and allocentrism interacted with organisational-level indi-
vidualism and collectivism to predict work-related attitudes such as satisfaction
with promotion, with work itself, with co-workers, and with supervisors.
Similarly, Chatman and Barsade (1995) randomly assigned participants who
were either allocentrics or idiocentrics to simulated cultures that were col-
lectivistic or individualistic. They found that allocentrics had a tendency to
adjust, whereas idiocentrics showed less variance across contexts. However,
the extent to which these societal norms interacted with individual differ-
ences (i.e. allocentrism and idiocentrism) and leadership style has not been
explored.
We have argued earlier that the extent to which leadership style affects
follower work-related attitudes may vary depending upon follower indi-
vidual differences. We further explored the extent to which the relationships
examined in our proposed hypotheses may vary depending upon the domi-
nant societal culture (e.g. collectivism vs. individualism). Specifically, does
the societal context interact with individual differences and leadership to
predict individual attitudes? According to culture-fit theory (e.g. Kanungo
& Jaeger, 1990; Kanungo, Aycan, & Sinha, 1999), the socio-cultural environ-
ment such as societal culture can influence individual behavior to the extent

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 LEADERSHIP AND INDIVIDUAL DIFFERENCES 219
that internal individual values are shaped by the larger societal values in
which individuals are embedded, which in turn would affect individual per-
ceptions, attitudes, and behaviors. In line with arguments made by Jung,
Bass, and Sosik (1995) we expect the effects of transactional and transfor-
mational leadership to be enhanced by cultural orientation. In view of exist-
ing research, we expect that transformational leadership will have a more
positive effect in collectivistic cultures among allocentrics and that trans-
actional contingent reward will have a more positive effect in individualistic
cultures among idiocentrics.

METHODS

Research Setting, Sample, and Procedure

Data were collected in 38 bank branches in China (n = 213), India (n = 210),
Kenya (n = 159), and the US (n = 243). Respondents were mostly tellers and
clerks. Surveys were administered on-site individually in China, India, and
Kenya (86% response rate). In each country, a senior manager was asked to
assist in the initial distribution of the questionnaires; however, the com-
pleted questionnaire was collected by one of the research team members.
In the US, the survey was sent to potential participants in 10 branches in
the Midwest through the bank’s internal mailing systems. Respondents were
provided with confidential envelopes and were asked to return completed
surveys directly to the first author (91% response rate). An English-language
version of the survey was used in India, Kenya, and the US. For China, the
survey, which was developed in English, was translated into Chinese (Brislin,
1980). A bilingual speaker performed the initial translation. After this step
was completed, the questionnaire was given to another bilingual translator,
who then back-translated it into English. All participants were informed
that completion of the survey was voluntary. The average age of partici-
pants was 33.93 years (China = 32.32, India = 34.12, Kenya = 31.65, US =
37.81) and 49 per cent were women (China = 39%, India = 52%, Kenya =
41%, US = 62%). The average organisational tenure was 8.20 years (China
= 7.56, India = 9.35, Kenya= 7.22, US = 8.07), with more than 95 per cent
having completed some college or university degree.

Measures
Leadership Measures. We used 24 items from the Multifactor Leader-
ship Questionnaire Form 5x to measure transformational (α = .92) and
transactional contingent reward (α = .76) leadership (Bass & Avolio, 1995).
Note, because our hypotheses made no distinction between the component
factors of transformational leadership, we combined the four dimensions of

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220 WALUMBWA ET AL.

transformational leadership to form a single transformational leadership

scale. Ratings were completed on a 0 to 4 scale (0 = “Not at all”, 4 =
“Frequently, if not always”). Sample item: “Articulates a compelling vision
of the future” (transformational leadership) and “Makes clear what one can
expect to receive when performance goals are achieved” (contingent reward).

Individual Differences. Individual difference was measured using 22

items used by Robert, Probst, Martocchio, Drasgow, and Lawler (2000) to
measure allocentrism and idiocentrism. These items were adopted from the
INDCOL scale (Singelis, Triandis, Bhawuk, & Gelfand, 1995; Triandis &
Gelfand, 1998). Based on an assessment of whether these items were invari-
ant across the four countries, two items (allocentrism) and three items (idio-
centrism), respectively, were eliminated from further consideration. In all
subsequent analyses described below, nine items were used to measure allo-
centrism (α = .68) and eight items measured idiocentrism (α = .67). Sample
items: “My happiness depends very much on the happiness of those around
me” (allocentrism) and “My personal identity is very important to me”
(idiocentrism). Ratings were on a 5-point scale (1 = “Strongly disagree”, 5
= “Strongly agree”).

Organisational Commitment. Organisational commitment (α = .89) was

measured using 10 items from Mowday, Steers, and Porter (1979). Sample
item: “This organisation has a great deal of personal meaning for me”.
Responses were made on a 5-point scale, with 1 representing “Strongly
disagree” and 5 representing “Strongly agree”.

Satisfaction with Supervisor. We used nine items from Smith, Kendall,

and Hulin’s (1969) Job Descriptive Index (JDI) to measure satisfaction with
supervisor (α = .87). Respondents were asked to circle “yes” (3) if the item
described their supervisor or their work, “no” (1) if the item did not, and “?”
(2) if they could not decide. Sample item: “My supervisor praises good work”.

Measurement Issues
Before conducting our primary tests of our hypotheses, we assessed the
extent to which individual items were invariant across the four countries
using AMOS maximum likelihood estimation (Arbuckle & Wothke, 1999).1
We then tested for invariant factorial structure of the theoretical model to

1
Note that consistent with Lam et al. (2002), we first assessed each scale separately and then
tested the factor structure with all scales included in the same model. The indices are reported
for the overall model.

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 LEADERSHIP AND INDIVIDUAL DIFFERENCES 221
test the assumption that factor loadings were equivalent across samples. In
model A (unrestricted), each indicator was allowed to load only on its fac-
tor, but the factor loadings and covariances were allowed to vary across
country. In model B (restricted), factor loadings were restricted to be invari-
ant across the four samples, but the covariances were free to vary across
countries. The fit indices indicate a satisfactory fit of the data for Model A
(unrestricted) model (χ2/df = 2.29, GFI = .90, CFI = .92, RMSEA = .08).
Fit indices marginally improved for the more constrained Model B (χ2/df =
2.17, GFI = .91, CFI = .93, RMSEA = .06), suggesting that the indicators
measured their latent traits well, even though the loadings were constrained
to be invariant across samples. All the estimated factor loadings were sig-
nificant and closer to 1.00, suggesting that the indicators measured the
latent traits well even under constraint. Thus, given that model B provided
an adequate fit to the data after we set constraints on parameters across
samples, we concluded that the assumption of measurement equivalence
was acceptable.

RESULTS
Table 1 shows the descriptive statistics among the study variables. Means
across the four countries were generally similar, except for transformational
leadership, which was relatively low in China. We also examined if there
were any significant differences between the banks in terms of the relation-
ships between leadership style and individual differences with respect to the
various outcome variables, and found no significant differences.

Tests of Hypotheses
We tested our hypotheses using moderated multiple regression. Note that
although leadership has been recently conceptualised and analysed as a
group-level construct (Bono & Judge, 2003), in this study we treated leader-
ship as an individual-level variable because we recognised that leaders may
be perceived as behaving differently across situations and individuals. This
is consistent with Avolio and Yammarino’s (1990) assertion that individual
differences in perceptions may account for variation in ratings of leadership.
Age, country (dummy-coded), gender (dummy-coded), and organisation
tenure were used as controls in all analyses. Any variable used as a compo-
nent of an interaction term was mean-centered (Aiken & West, 1991), and
tests for normality demonstrated no violations of assumptions underlying
the regressions. A national culture variable was created by coding the US
as 0 and the other remaining countries 1 in each separate analysis.
Table 2 presents the results of these regression analyses. In the first step,
the controls, leadership, and individual differences accounted for 22 per cent

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222 WALUMBWA ET AL.

TABLE 1
Means, Standard Deviations, and Inter-correlations by Country

M SD α 1 2 3 4 5

China
1. Transformational leadership 1.91 .63 .91
2. Contingent reward 1.79 .75 .62 .44**
3. Allocentrism 3.72 .27 .69 .22** .09
4. Idiocentrism 3.49 .33 .64 .09 .16* .31**
5. Satisfaction with supervisor 1.57 .45 .84 .58** .37** .21** .12
6. Organisational commitment 3.35 .65 .88 .41** .35** .16* −.08 .42**
India
1. Transformational leadership 2.19 .65 .88
2. Contingent reward 2.36 .78 .63 .41**
3. Allocentrism 3.76 .46 .80 .25** .02
4. Idiocentrism 3.53 .58 .75 .12 .23** .39**
5. Satisfaction with supervisor 1.50 .43 .81 .51** .44** .30** .11
6. Organisational commitment 3.82 .64 .85 .34** .31** .48** .14* .34**
Kenya
1. Transformational leadership 2.20 .70 .90
2. Contingent reward 2.29 .78 .77 .46**
3. Allocentrism 3.95 .35 .65 −.08 .07
4. Idiocentrism 3.64 .53 .69 .09 .07 .04
5. Satisfaction with supervisor 1.54 .51 .84 .40** .36** .14* −.05
6. Organisational commitment 3.60 .82 .90 .33** .35** .15* −.11 .25**
US
1. Transformational leadership 2.35 .83 .94
2. Contingent reward 2.65 .93 .83 .49**
3. Allocentrism 3.75 .39 .65 .14* .08
4. Idiocentrism 3.48 .43 .69 .21** .12 .39**
5. Satisfaction with supervisor 1.98 .51 .93 .50** .27** .09 .17**
6. Organisational commitment 3.66 .80 .92 .37** .15* .21** .19** .28**

* p < .05; ** p < .01 (two-tailed).

and 24 per cent of the variance in organisational commitment and satisfac-

tion with supervisor, respectively. In the second step, adding two-way inter-
action terms resulted in .05 increases in R2 for organisational commitment
and .06 in R2 for satisfaction with supervisor, predicting a total of 27 per cent
and 30 per cent of the variance in organisational commitment and satisfaction
with supervisor, respectively. In support of Hypotheses 1, 3, and 4, our
findings indicated that allocentrism and idiocentrism moderated the
relationship between leadership style (i.e. transformational and transactional
contingent reward) and work-related attitudes (i.e. organisational commit-
ment and satisfaction with one’s supervisor). We did not find any support
for Hypothesis 2, concerning the interaction of transactional contingent
reward leadership and allocentrism in predicting work-related attitudes.

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 LEADERSHIP AND INDIVIDUAL DIFFERENCES 223
TABLE 2
Results for Two-way and Three-way Regression Analyses

Organisational Satisfaction with

commitment supervisor

Variable β t β t

Step 1
Control
China .08 2.29* .09 2.42*
India .06 1.92† .07 1.89†
Kenya .08 2.03* .10 2.62*
Age .06 1.79† .09 2.56**
Gender .04 1.23 .01 .17
Organisation tenure .01 .09 −.04 −1.10
Transformational leadership .37 6.64*** .38 7.38***
Transactional contingent reward leadership .15 3.23** .17 3.69**
Allocentrism .23 5.25*** .31 5.87***
Idiocentrism .13 3.05** .09 2.72**
R2 .22 .24
Step 2
Transformational leadership * allocentrism .14 3.79*** .12 3.17**
Transformational leadership * idiocentrism −.08 −2.35* −.11 −3.03**
Contingent reward leadership * allocentrism .05 1.13 .06 .16
Contingent reward leadership * idiocentrism .10 2.84** .13 4.58***
∆R2 .05** .06**
Transformational * allocentrism * country .38 3.08** .49 4.29***
dummy
Transformational * idiocentrism * country .29 2.41* .25 2.02*
dummy
Contingent reward * allocentrism * country .15 1.11 −.19 −1.69†
dummy
Contingent reward * idiocentrism * country −.25 −3.30** −.35 −3.35***
dummy
R2 for total equation (F for total equation) .28 (15.80***) .39 (26.64***)

Note: Dummy code (US = 0; other countries = 1); coefficients (standardised) are reported only for the three-
way interactions (n = 825).
† p < .10 (marginally significant); * p < .05; ** p < .01; *** p < .001.

To take a closer look at the nature and form of the significant two-way
interactions, we plotted these interactions with results shown in Figure 1a−
1f. As shown in Figure 1a−1f, the relationship between transformational
leadership and work attitudes was more positive as the level of allocentrism
increased. Similarly, Figure 1e and 1f showed that the relationship between
contingent reward leadership and work attitudes was more positive as the
level of idiocentrism increased, providing support for predictions concerning
the two-way interactions.

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224 WALUMBWA ET AL.

FIGURE 1. Effects of the interaction between leadership and individual

differences.

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Psychology.
 LEADERSHIP AND INDIVIDUAL DIFFERENCES 225
To explore if the relationships reported above varied as a function of
societal culture (i.e. collectivism vs. individualism), we created a three-way inter-
action term. To do this, we grouped China, India, and Kenya as our collectivist
countries and dummy coded them 1, to compare them collectively to the US
individualistic culture dummy coded 0. Note that because any variable used
as a component of an interaction term was mean-centered, all linear terms
and possible two-way interactions were included in the equation when testing
the three-way interactions. These linear terms and extra two-way effects,
however, have no substantive interpretation other than to provide mathematical
corrections for the three-way interaction terms (Aiken & West, 1991).
Results of the three-way interactions are presented in the lower part of
Table 2. Specifically, one can see that transformational leadership was most
positively related to organisational commitment (β = .38, t = 3.08, p < .01)
and satisfaction with supervisor (β = .49, t = 4.29, p < .001) for allocentrics
in collectivistic cultures. Conversely, a negative three-way interaction involving
contingent reward leadership × idiocentrism × country code for organisa-
tional commitment (β = −.25, t = −3.30, p < .001) and satisfaction with
supervisor (β = −.35, t = −3.35, p < .001) indicates that transactional con-
tingent reward leadership had a more positive effect for idiocentrics coming
from an individualistic culture.

DISCUSSION
Our primary goal was to examine the moderating effects of allocentrism
and idiocentrism on relationships between leadership style and work-related
attitudes, and to assess the extent to which these relationships varied as
a function of larger societal context/country. To our knowledge, this is the
first examination of how individual values and the larger societal context
affect the relationship of transformational and transactional contingent
reward leadership with relevant organisational outcomes.
Results of this study extend work by Walumbwa and Lawler (2003) by
showing the moderating effects of allocentrism and idiocentrism with
respect to the relationships between leadership style and follower work-related
attitudes/outcomes. Specifically, for those individuals who were more allo-
centric, transformational leadership was more positively associated with
work-related attitudes/outcomes; for those individuals who were more idio-
centric, transactional contingent reward leadership was more positively associated
with work-related attitudes/outcomes. These findings are consistent with the
underlying assumption that individual differences may account for differ-
ences in how various leadership styles are perceived by followers (Chan &
Drasgow, 2001).
We also found that transformational leadership had a more positive effect
among allocentrics from collectivist cultures and transactional contingent

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226 WALUMBWA ET AL.

reward leadership had a more positive effect among idiocentrics from an

individualistic culture. Our results imply that individual dispositions and
societal norms may be contingently related to one another. For example, a
young Chinese worker who is more idiocentric might functionally behave
more as an individualist if this worker lives in an individualistic culture.
However, if this same Chinese worker lives in a society that is more collec-
tivist, he/she might abide by the dominant cultural norms related to family
life since he/she might be sanctioned for doing otherwise. Future research
examining how cultural differences and leadership styles interact with one
another must now take into consideration both the culture in which leader
and follower interactions occur as well as individual differences regarding
culture values.

Limitations and Implications for Future Research

and Practice
The findings of this study are limited by its cross-sectional design and by
use of a single source method of data collection. However, a review of the
correlations does not point to consistently high coefficients as would be
expected if such a bias was having a strong impact on the pattern of our
results. In addition, the effects of common method bias are primarily
evidenced when one is examining the magnitude of associations between
variables and/or main effects. The primary focus of our study was on the
interactions between variables, while we controlled for the main effects of
the variables that comprised the interaction terms in our regression models.
Nonetheless, our study’s findings must be viewed as preliminary until
further replications and extensions are undertaken.
An additional potential limitation is the range of country cultures
included here as well as the specific banking context in which this study was
conducted. Future research needs to include a broader sampling of organi-
sations across different industries and countries that vary with respect to the
cultural values of interest tested in this study. Finally, we chose to combine
the four dimensions of transformational leadership to form a single scale of
transformational leadership. Since transformational leadership can be viewed
as a multi-faceted construct, it is possible that different facets of transfor-
mational leadership may interact differently with individual differences and
societal values to produce different results. Future studies might consider
investigating whether the current findings vary as a consequence of testing
the individual facets of transformational leadership.
Despite these limitations, this study has made several contributions to the
cross-cultural leadership literature. First, the results of this study provide
fairly strong support for the independent and interactive effects of individual
differences in addition to societal context in terms of explaining the relation-

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 LEADERSHIP AND INDIVIDUAL DIFFERENCES 227
ship of transformational and transactional contingent reward leadership to
follower outcomes. The preliminary evidence provided here regarding how
societal and individual value differences predicted work-related outcomes
offers a very exciting avenue for future research to pursue. For example, the
current findings suggest that greater attention now needs to be paid to
assessing what constitutes more or less effective ways of developing leader-
ship within and between cultural settings (Ayman, 2004; Gelfand et al.,
2004; Kanungo et al., 1999; Aycan, Kanungo, Mendonca, Yu, Deller, Stahl,
& Kurshid, 2000; Walumbwa & Lawler, 2003).
From a practical point of view, our results may also provide some
insights into how transformational and transactional contingent reward
leadership can be used in motivating diverse work groups. For instance,
being aware of the moderators identified here may help managers to identify
individual and organisational contexts where transformational or transac-
tional contingent reward leadership is more or less likely to enhance organ-
isational commitment and satisfaction with supervisor. Helping leaders to
be more aware of their impact on individuals with different orientations and
backgrounds would help them to best adjust their leadership style to the
individual values of their followers, organisations, and societies in which
they are leading. Finally, although not the main focus of this study, the idea
that transformational and transactional contingent reward leadership were
both positively related to work-related outcomes suggests that the same type
of leadership may be more or less effective in part, depending on the orien-
tation of the individual.
In sum, our results show that we need to consider individual differences
in helping to explain how leaders operating across different cultural settings
are viewed by their followers. We also need to consider the role of societal
values if we are to optimise the highest level of organisational commitment
and satisfaction with leaders. This level of sensitivity to individual and
societal cultural differences may be particularly relevant when examining
leadership in global virtual teams, whose interactions may be even more
affected by differences between leaders and followers in terms of cultural
values.

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