Contingent Reward, Regulatory
Focus, and Trust
Ronald F. Piccolo
Rollins College
Tomek A. Kosalka
University of Central Florida
Craig Crossley
University of Nebraska
The Full Range of Leadership
• Transactional Leadership (TA)
▫ Refers to the exchange relationship b/w leader and
follower to meet their own self interests.
• Transformational Leadership (TF)
▫ Refers to the leader moving the follower beyond
immediate self interests.
• Scholars tend to suggest that mechanisms underlying
TF and TA are in conflict (Jung & Avolio, 2000),
▫ TA (Contingent Reward) leaders activate extrinsic, shortterm, task- and self-oriented psychological mechanisms
▫ TF leaders rely on emotional arousal, trust, shared values,
and selfless effort
Contingent Reward
• An active dimension of the Transactional Leadership model (TA)
• Multi-Factor Leadership Questionnaire (Bass & Avolio, 1995)
My leader…
▫ Provides me with assistance in exchange for my efforts.
▫ Discusses in specific terms who is responsible for achieving performance targets.
▫ Makes clear what one can expect to receive when performance goals are
achieved.
▫ Expresses satisfaction when I meet expectations.
• Bass (1985) – Transformational leadership builds on and augments
transactional leadership (although not vice versa).
• Bass and Avolio (1993) assert that the augmentation effect is a
"fundamental" aspect of TF-TA leadership theory.
• Countless studies support the notion that TF adds beyond the TA
dimensions – including contingent reward (CR)
In the last 5 years…A Resurgence of Research on
Transactional Leadership
80
70*
70
60
50
Judge & Piccolo (2004)
r CR = .39 (r TF = .44)
r CR > r TF; Follower Sat; Leader Performance
r TF – CR = .80
40
30
20
25
15
10
0
1999
2000
2001
2002
2003
Source: ISI Web of Science; * 51 articles YTD 2009.
2004
2005
2006
2007
2008
2009
Keyword = Transactional Leadership, 2005 - 2009
• Measurement of the Concept: 13
• Motivation: 22; Goals: 23
• Justice/Fairness: 20
• Creativity/Innovation: 20
• Moderators: 43
• Mediators (process): 59
ISI Web of Science
The Current Study
• Leaders influence the motivational self-regulatory focus of their
followers, which will mediate different follower outcomes at
the individual (and group) level (Kark & van Dijk, 2007).
• We propose…not only are TF and CR highly related, not only
share validities across outcomes, but are ultimately realized
through similar processes – self regulatory focus (promotion).
• We seek to extend the model proposed by Kark & van Dijk:
leaders who exhibit CR behaviors (providing assistance, defining
performance standards, demonstrating how work behaviors
translate into rewards) prime the focus of followers for
achievement (i.e., promotion).
Model of Relationships
Contingent
Reward
Promotion
Focus
Trust
Performance
Method
• Participants: 87 sales professionals from a food
distribution company participated in a 3-day training
and strategic planning session.
• At the end of the first day, participants completed a
battery of assessments, including measures of
contingent reward, regulatory focus, and trust.
• After four weeks, general managers of the sales
divisions provided weekly performance data (# of
buyers; $$ sold, performance-to-goal).
Measures
• Contingent Reward (Bass & Avolio, 1995)
• Regulatory Focus (promotion; Wallace & Chen, 2006), a = .77
“Right now, I am concerned with…”
 Accomplishing a lot of work
 Getting my work done no matter what
 Getting a lot of work finished in a short amount of time
 Work activities that allow me to get ahead
 My work accomplishments
 How many tasks can I complete
• Trust (ad hoc items), a = .90




I Feel I can trust my LGM
I sometimes hold back from trusting my LGM
I have complete trust in my LGM
I know I can Trust my LGM
• Performance = # of New Buyers (weekly), 4 weeks
Correlations
1
2
3
4
5
6
1. Contingent Reward
(.84)
2. Promotion Focus
.27*
(.77)
3. Trust
.74*
.22*
(.90)
4. Performance 1
.31*
.27*
.19†
--
5. Performance 2
.33*
.08
.23*
.73*
--
6. Performance 3
.23*
.14
.18
.80*
.72*
--
7. Performance 4
.21*
.08
.09
.70*
.81
.82*
Note. n = 75 – 81. * p < .05.
Regression Results
Promotion Focus
b
R2
DR2
1. Contingent Reward
.31*
.09*
.09*
2. Contingent Reward
.25*
.13*
.04*
Promotion Focus
.20†
1. Contingent Reward
Trust
2. CR x Trust
b
R2
DR2
.23*
.07*
.07*
.15*
.08*
Performance
.05
2.23*
CR x Trust → Promotion
Promotion Focus
6.5
6.0
5.5
5.0
Low CR
High CR
Low Trust
High Trust
Summary
• CR related to performance outcomes in all four weeks
• CR primed promotion focus (extension of Kark & van Dijk)
▫ Effect was moderated by Trust in supervisor
• Promotion focus related to performance in week one only
▫ Are the effects associated with primed regulatory focus
temporal?
• Mediating Effects of Promotion Focus were modest
▫ n~80; low power
• Effects of Promotion on Goal Setting and $$ Sales were
weak
Conclusions
• Original theorizing on augmentation effect of TF:
▫ Transformational adds to (but does not substitute for)
the effectiveness of transactional leadership.
• Recent empirical results
▫ Validities are similar across criteria.
▫ In many cases, transactional adds to the effectiveness
of transformational (e.g., Follower Satisfaction).
• Effects of TF & CR are realized through similar
mechanisms (e.g., self regulatory focus)
• Relationship between CR and Promotion Focus
depends on Trust (see also, LMX)
Why does TA augment TF?
• CR comprises leader activity that is not adequately
captured in Transformational behaviors. CR leaders…
▫ Make clear expectations of outcomes & rewards
▫ Actively monitor progress towards objectives
• CR satisfies self-interested, individual needs (i.e., CR
taps individual need systems that are not fully
engaged by TF leader behaviors)
▫ “Whenever there is a conflict between universal principles
and self interest, self interest is likely to prevail”
Open Society: Reforming Global Capitalism
▫ “Never appeal to a man’s ‘better nature’; He may not have
one. Invoking his self-interest provides much more leverage.”
Lazarus Long (by Richard A. Heinlein)
Future Studies
•
•
•
•
Additional Power
More sophisticated examination of effects over time
Alternative outcomes (affective, behavioral)
Examination of CR vs. TF
▫ To what extent does context play a role?
• We look to Ronit Kark for guidance 
Thank You.