Leadership Determinants of Trust

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Leadership Determinants of Trust

Sim Sitkin

Fuqua School of Business

Duke University

In collaboration withAllan Lind, Morela Hernandez, and Chris Long

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What Influences Trust?

Various influences have been identifiedCompetence, benevolence, reliability, honesty, etc (e.g., Dirks &

Ferrin, Avoilio and colleagues)

Influences are generally consistent with the kinds of things leaders “should” do

But the links between specific leadership behaviors and trust has remained largely unexamined

Often asserted, rarely testedConceptualization is often vague and atheoretical, or very broad

Goal is to clarify the potentially important insights for both literatures

Present newly developed leadership approachMake the leadership-to-trust links explicit and specificPresent preliminary results of an early testDiscuss some implications

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The “Leadership Challenge”

There is a substantial body of work on leadership, but there is not really a clear picture of what leadership is and how one can teach people to be better leaders.

Some scholars (e.g., Meindl, Ehrlich, & Dukerich) have even contended that leadership is not an important factor in organizational performance, that it is simply a “romanticized explanation” of more complex management and environmental factors.

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How to Address the Challenge

Consider whether there is indeed something in the concept of leadership to theorize about, study, and teach

Organize our understanding of leadership and related phenomena so that we can systematically examine how leadership evolves as organizations change

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Contemporary research and theory on leadership

Huge quantity and variety

Variable in focus and qualityEmpirically rigorous, but more usually managerial than leadership-

focused

Atheoretical and/or vague

Practitioner-oriented, but not very systematic or testable

Narrow, focusing on only one or two aspects of leadership

Theoretical, but are not very generative for rigorous scholarship or practical enough for managerial application

Some examplesTransformational leadership, Charismatic leadership, Symbolic

leadership, Attribution theories of leadership, Relational leadership

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A preview of approach

Working with my colleagues Allan Lind and Chris Long (and additional colleagues, and including recent PhD students Jim Emery, Morela Hernandez, and Drew Carton), we have worked to organize and integrate this topic with an eye to empirical testing and implementation.

We have found ourselves incorporating & extending many elements used by other theories, but we have been most influenced by relational views of leadership and trust. Thus, today’s focus . . .

Before I begin presenting our theory and early results on the impact of leadership on trust, let me define it and give you a brief picture of our leadership framework.

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Definition of Leadership

A leader is:A person who influences othersA person who exhibits specific leadership behaviorsA person who accepts a leadership role and identity

Leadership is:A set of behaviors and their effectsA social role A perspective or identity

Leadership is not:Formal authority or positionOnly positive (effective leaders can pursue evil)A set of traits that cannot be developed or modified or learned

(“you can’t teach height” but you can teach leadership)

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Leadership versus Management

Not about leaders vs. managers, not different peopleMost individual roles involve elements of both leadership

and management

But both good leadership and good management are necessary for optimal organization performance

Leadership is not just about top organizational heroesIncludes leading up, down and laterally

Applies to a variety of life roles – leading peers, family members, community, leading oneself

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How is the Approach Distinctive? Focus on Behavior:

Leadership is what you do, not just who you are. Change what you do and you can change your leadership style. Thus, the approach is testable and actionable.

Focus on Effects:

Each dimension is keyed to theorized effects of leadership behaviors.

Focus on Breadth and Integration:

Most leadership approaches focus on just a few aspects of leadership – ours tries to integrate the range of leadership dimensions – and effects.

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Leadership domains

ETHICALETHICAL

INSPIRATIONALINSPIRATIONAL SUPPORTIVESUPPORTIVE

PERSONALPERSONAL RELATIONALRELATIONAL CONTEXTUALCONTEXTUAL

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Core focus of the domains

Accepting Accepting responsibilityresponsibility

Raising Raising optimism optimism

& enthusiasm& enthusiasm

Providing Providing resources,resources,feedback, andfeedback, andprotectionprotection

PreparingPreparingand projectingand projecting

who you arewho you are

ShowingShowingconcern andconcern and

understandingunderstanding

ClarifyingClarifyingwho we arewho we areand how weand how wework togetherwork together

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Consequences of effective leadership

TRUSTCREDIBILITY COMMUNITY

INITIATIVEHIGHASPIRATION

STEWARDSHIP

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Leadership domains and effects

ETHICALETHICAL



CREDIBILITY TRUST COMMUNITY


STEWARDSHIP

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Our Focus Today

TRUSTTRUST

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Definition of Trust

Trust is a psychological state comprising the intention to accept vulnerability based on positive expectations of the intentions or behavior of another (Rousseau et al., 1998)

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Foundation of the Model

Personal: Leadership emerges from the projection of your personal values, concerns, passions and world view.

Relational: Leadership is rooted in projecting concern for and understanding of others in interpersonal and inter-organizational relationships.

Contextual: Leadership simplifies and focuses by clarifying contexts.

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Personal Leadership

Demonstrate that you have theinsight and knowledge to lead tosuccess.

Be real; let your values andpersonality show in your actions.

Make your dedication to the team--and your courage in pursuing itsgoals--evident to all.

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CREDIBILITYCREDIBILITY

Effective personal leadership yields

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Relational Leadership

Attend to your leader-followerrelationship with eachperson you seek to lead:

Show concern, understanding, and respect for others.

Be seen as fair.

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Effective relational leadership yields

TRUSTTRUST

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Contextual Leadership

Create a sense of identity (pride and belonging).

Focus and simplify to build a sense of coherence.

Enhance clarity of roles and functions.

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Effective contextual leadership yields

a sense of

COMMUNITYCOMMUNITY

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But our focus today is on leadership determinants of trust

TRUSTTRUST

What is the prediction from the literature about what influences trust?

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So how might these three dimensions relate to trust?

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Arguments Extrapolated from Trust Literature

Personal Leadership Affects TrustCompetence, shared values, personal interests are predictive of trust (Sitkin

& Roth; Mayer et al)

Attribution of leadership – passion, insight (Calder)

Relational Leadership Affects TrustLeadership as forms of relationship (Weber; Lewin; Kouzes & Posner)

Benevolence, caring, respect, fairness & understanding of the other (Bies; Lind & Tyler; Sitkin & Roth)

Contextual Leadership Affects TrustIncreased contextual control undermines trust in other party (Shapiro,

Zucker)

Symbolic leadership and the importance of congruent symbols (Pfeffer; Sitkin & Stickel)

Without formal protection, risk of opportunistic exploitation is too high (Sitkin; Lewicki & Bunker; Bijlmsma-Frankema & Costa; Long & Sitkin)

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Personal

Trust

Implicit Theoretical Model

Relational Contextual

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ETHICALETHICAL

28More personal More structural

Foundation

Second-Order

Third-Order

Key theoretical assumption: interdependence of leadership domains

ETHICALETHICAL



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Leadership Framework Extends Argument to Make It More Directly Testable

Dimensions of Leadership are Mutually Facilitative

Personal & Contextual Leadership Affects Trust, but only through their link to Relational Leadership

Direct Links of Personal and Relational to Trust implied in the literature may be spurious, as indirect routes of influence never tested

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Personal

Trust

Theoretical Model


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Hypotheses

Higher levels of Relational Leadership are associated with greater Trust in the leader (H1).

Personal (H2A) and Contextual (H2B) Leadership will be significantly associated with Trust.

Personal (H3A) and Contextual (H3B) Leadership will be significantly associated with Relational Leadership.

The effects of Personal (H4A) and Contextual (H4B) Leadership on Trust will be mediated by Relational Leadership.

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Sample and ProcedureParticipants completed the 360-degree survey online as part of

executive leadership courses (n=129)Weekend EMBA (n=55)

Cross Continent EMBA (n=52)

Open Enrollment (n=22)

Ratings supplied by supervisors, peers and direct reports (n= 700+)

Permission to use data for research requested, nearly all consented

Survey distributed & completed online (approx. 20 minutes to complete survey)

Participants received feedback as part of a course

Raters assured anonymity; ratings aggregated to preserve confidentiality of individual raters

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Web-based Leadership Instrument

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MDLI Feedback

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MDLI results (graphics)

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6 domains, multiple rater groups

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MDLI results (Personal Leadership table)

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Some Preliminary FindingsToday’s analysis based on data collected in July,

August, September of 2003.

Able to clean data and create appropriate scales

Analyzed using structural equation models (AMOS)

Still consider findings to be tentative - newly redesigned variables & results in but not yet analyzed.

But results seem quite robust, so optimistic

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IV Scales created from “follower” perceptions of leader behaviors

DV Scales created from “follower” ratings of leader effects across three rater groups

Intraclass Correlation Coefficient (ICC)

ICC useful for determining the extent to which variance of individual responses are attributed to group membership

ICC assesses reliable differentiation between groups (Bliese et al., 2002; Castro, 2002)

ICC especially useful if between group variability is potentially theoretically important and requires detailed examination

Scale Reliabilities“The locus of leadership . . . involves behaviors . . . produced by leaders as these

elements are interpreted by followers.” (Lord & Maher, 1993; p.11)

Supervisors + Peers + Direct Reports: ICC = .862Peers + Direct Reports: ICC = .723

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Independent Variables

Personal Leadership Behavior (α = .80) Authenticity - Creativity

Vision - Passion & Courage

Expertise

Relational Leadership Behavior (α = .81)Concern

Respect

Reliability

Contextual Leadership Behavior (α = .77)Coherence

Coordination

Identity

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Personal Leadership Behavior (α = .80) Authenticity

Lets you know what he/she is really like.

Lives his/her values.

They are who they appear to be.

VisionProvides a clear vision for the organization or unit.

Formulates clear goals.

Articulates where the organization/unit is going.

ExpertiseReally understands our work.

Is smart about what we do.

Has deep expertise.

CreativityFinds innovative solutions to business problems.

Is open to exploring new ideas.

Thinks outside the box.

Passion and CourageIs passionate about the work we do.

Displays courage in the face of uncertainty.

Is not afraid to show his/her feelings.

Is not afraid of being wrong.

Is committed to doing what he/she thinks is right.

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Relational Leadership Behavior (α = .81)

ConcernDisplays concern for me.

Is sensitive to my needs.

Cares about my priorities and interests.

Is interested in understanding me.

Shows compassion.

RespectShows respect for people regardless of their level in the organization.

Makes an effort to seek out others' opinions on important issues.

Takes the time to explain decisions.

Is a good listener.

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Contextual Leadership Behavior (α = .77)

CoherenceMakes sure his/her employees understand business issues.

Promotes a shared understanding about complex issues.

Cuts through complex or ambiguous problems to make them easier to understand.

Explains why things are being done a particular way.

CoordinationHelps coordinate actions of unit or organization.

Resolves conflicts constructively.

Creates processes that facilitate the work.

Ensures that we take the needs of others into account as we do our work.

Makes clear how responsibilities are being divided.

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Dependent Variables: Leadership Effects

Personal Leadership: LOYALTY (α = .86 )I feel loyal to ____. ____ can depend on me.I would go out of my way to help ____ if he/she asked me to.

Relational Leadership: TRUST (α = .80 )I trust ____ to be fair. ____ deals fairly with me. ____ is unbiased in his/her decisions.

Contextual Leadership: COMMUNITY (α = .87 )We are like family.People here are concerned with the success of the whole organization.I feel like I’m really part of the team around here.In this organization, we know we can depend on each other. Being a good organizational citizen is part of our organization culture.

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Hypotheses

Higher levels of Relational Leadership are associated with greater Trust in the leader (H1).

Personal (H2A) and Contextual (H2B) Leadership will be significantly associated with Trust.

Personal (H3A) and Contextual (H3B) Leadership will be significantly associated with Relational leadership.

The effects of Personal (H4A) and Contextual (H4B) Leadership on Trust will be mediated by Relational leadership.

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Personal

Trust

Theoretical Model


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Statistical Methods

Structural Equation Model Analyses (AMOS 5.0 in conjunction with SPSS 11.5)

4 models are presented

Standardized Regression Weights are shown

Details (error terms etc) are not shown on models to simplify display for readability

Model Fit Indices TLI and CFI were considered

This is still very much a work in progress

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TRUST

e11e10 e12

e13

Vision PassionExpertiseCreativity Authenticity

e1 e2 e3 e4 e5

Respect Concern

e6 e7

Coordination Coherence

e8 e9

Personal Ldrshp

Relational Ldrshp

Contextual Ldrshp

Model

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Personal Ldrshp

Relational Ldrshp

Contextual Ldrshp

TRUST

Model Fit: TLI = .54; CFI = .66

.34** .26* .45***

Direct Effects Test of Trust Literature

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Personal Ldrshp

Relational Ldrshp

Contextual Ldrshp

TRUST


.34**

.26* .45***

•Significance consistent with trust literature (H1, H2A & H2B)•Fit of model based on literature is quite low.

Direct Effects Test of Trust Literature

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Personal Ldrshp

Relational Ldrshp

Contextual Ldrshp

TRUST

ns ns .78*

.35** .62***


Test of Hypothesized Mediated Model

r = .87

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Personal Ldrshp

Relational Ldrshp

Contextual Ldrshp

TRUST

ns ns .78*

.35** .62***


•Personal & Contextual Leadership significantly associated with Relational Leadership (H3A & H3B)•Direct effects predicted by trust literature mediated, as predicted (H4A & H4B) •Fit of model substantially improved & quite high.

Test of Hypothesized Mediated Modelr = .87

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Results of Hypothesis TestsHigher levels of Relational Leadership are associated with

greater Trust in the leader (H1). SUPPORTED

Personal (H2A) and Contextual (H2B) Leadership will be significantly associated with Trust. SUPPORTED WHEN EXAMINED IN ISOLATION; REJECTED WHEN MODELLED MORE COMPLETELY

Personal (H3A) and Contextual (H3B) Leadership will be significantly associated with Relational Leadership. SUPPORTED


H4A. SUPPORTED

H4B. SUPPORTED

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Implications of Hypothesis Tests

H1 and H2: All three foundational dimensions appear to be determinants of trust if examined independently.

Personal and Contextual Leadership were found to be significantly associated with Relational Leadership (H3A and H3B)

Relational Leadership is a key determinant of Trust.As a direct determinant of Trust (H1)

Personal and Contextual Leadership effects on Trust are mediated (H4A and H4B) by Relational Leadership.

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Including Self Ratings

“The locus of leadership is not solely in a leader or solely in follower. Instead, it involves behaviors . . . produced by

leaders as these elements are interpreted by followers.” (Lord & Maher, 1993; p.11)

Although our theoretical focus was based on “follower” reactions to leadership behavior (focusing on effects, not just leader attributes), we wanted to examine whether self ratings of leaders matched the ratings of “followers” and whether leader self

perceptions predicted “follower” trust in the leader.

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Personal Ldrshp (Self)

Relational Ldrshp (Self)

Contextual Ldrshp (Self)

TRUST

nsns


.12**

Examining Trust Predictions with Self Ratings

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TRUST

nsns


.12**

Examining Trust Predictions with Self Ratings

•Self ratings of leadership behavior are distinct from others’ rating, are less predictive of trust, & have terrible model fit.

•Could they have effects through others’ perceptions of leadership?

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Personal Ldrshp (Others)

Relational Ldrshp (Others)

Contextual Ldrshp (Others)

TRUSTModel Fit: TLI = .75 ; CFI = .81

.54***

ns

.67***

.18*.21**

ns ns.66**

nsns

ns

r = .78 r = .69

r = .88

Do Self Ratings Have an Indirect Effect on Trust?

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TRUST

Model Fit: TLI = .75 ; CFI = .81

.54*** .67***

.18*.21**

.66**

•Results are consistent with an indirect effect, but . . .

Why the striking relational leadership gap?

Do Self Ratings Have an Indirect Effect on Trust?

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Self and Other Perceptions of Relational Leadership Behavior

Familiar social psychology finding of a gap between self perception of how fair, concerned, understanding, etc we are compared with how others see us (e.g., Messick et al, “Why we are fairer than others” JESP, 1985 )

Why observe in this situation?Possible that relational leadership behaviors are harder to discern

Possible that we are not as relationally positive as we think

Possible that we are but are lousy at projecting our concern or our efforts

But could self perceived relational leadership behavior still have an indirect effect on trust via other self perceptions?

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Vision

PassionExpertiseCreativity Authenticity

Respect Concern Coordination

Coherence

Personal Ldrshp (self)

Relational Ldrshp (self)

Contextual Ldrshp (self)

e1 e2 e3 e4 e5 e6 e7 e8 e9

TRUST

e21e20 e22

e23

e10

Vision

PassionExpertiseCreativity Authenticity

e11 e12 e13 e14 e15

Respect Concern

e16 e17

Coordination

Coherence

e18 e19

Personal Ldrshp (other)

Relational Ldrshp (other)

Contextual Ldrshp (other)

Full Model

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TRUST

.56***

ns

.69***

.18*.22**

ns ns.65**

nsns

ns


.94*** .85***

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TRUST

.56*** .69***

.18*.22**

.65**


.94*** .85***

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Results of Hypothesis Tests

Higher levels of Relational Leadership are associated with greater Trust in the leader (H1). SUPPORTED

Personal (H2A) and Contextual (H2B) Leadership will be significantly associated with Trust. SUPPORTED WHEN EXAMINED IN ISOLATION; REJECTED WHEN MODELLED MORE COMPLETELY

Personal (H3A) and Contextual (H3B) Leadership will be significantly associated with Relational Leadership. SUPPORTED


H4A. SUPPORTED

H4B. SUPPORTED

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Implications of Exploration of Self versus Others’ Perception of Leadership

Leader self perceptions do not directly affect trust – but seem to have an indirect effect (sometimes very indirect) via others’ perceptions of leader behaviors

Followers’ perceptions of personal and contextual leadership behaviors appear to affect trust through followers’ perceptions of relational leadership behavior

Perceived relational leadership is the key to influences on trust in leaders

The relationship between self perceptions of leadership behavior and follower perceptions is not uniform – gap seems to be in the relational leadership dimension.

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Builds on existing theory

Consistent with trust, justice and leadership literatures

Provides more systematic theoretical framework for linking leadership to trust through specific influencing actionsCompetence and other personal attributes

Relational features of fair treatment, consideration, respect, benevolence

Structural features can enable but only through their relational effects

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Additional Implications/Future Directions

Leadership behavior can be systematically broken down and its effects on trust tested.

Leadership behavior does appear to be a significant influence on trust.

Examine what does not affect trust, as well as what does Does contextual leadership behavior really not affect trust if

relational features are controlled?

Test more complex, embedded models of how trust arises and is influenced by leadersSpecific behaviors, not just broader dimensionsDifferent organizational and cultural conditionsDifferent leader attributes

Test other effects in the leadership model

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Conclusion and Next StepsBook under development

Have tightened measures & tests, coupling with experimental studies

Will examine rest of model

Articles on specific tests and applicationsAMR piece in development on theoryUnder development on domain effects, crisis, organizational

founding, and co-leadership, etc

Case studies and instructional materialsPractitioner pieces & cases Improve measurement instruments

Longitudinal field & lab data collection on perceived behavior – plus “hard” performance and behavior measures

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Duke Leadership Research Program:

Additional Studies In Progress

Sim Sitkin, Allan Lind, and ColleaguesFuqua School of Business

Duke University

Winter, 2006

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Leadership Behaviors as Determinants of Specific and Distinct Follower Responses

Sim Sitkin & Allan Lind

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Leadership domains and effects

ETHICALETHICAL



CREDIBILITY TRUST COMMUNITY


STEWARDSHIP

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Leadership Determinants of Raised Aspirations

Sim Sitkin, Jim Emery, Drew Carton, & Allan Lind

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Initial Model for Aspirations

Elements of Inspirational LeadershipHigh standards, enthusiasm, confidence

Initial ResultsSupported, but fit could be improved

Path coefficient = .781, p<.001*

RMSEA .107, CLI = .83

PERSONAL Aspirations

* 263 observations of 61 leaders, SEM results adjusted for non-independence of observations using Cluster option in MPlus Version 3.13

Inspirational

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Additional Work on Aspirations

INSPIRATIONAL

PERSONAL RELATIONAL

Aspirations

Initial Results Individually, all 3 dimensions have positive and

significant path coefficients predicting Aspirations, but Only Inspirational remains positive and significant when

all three dimensions are included in the SEM model

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Gender and Leadership: The Effect of Mental Models at Different

Hierarchical Levels

Ashleigh Rosette, Leigh Tost,

Morela Hernandez, & Sim Sitkin

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Gender Differences in Leadership

Research Goals: Examine the ways that women top leaders may express gender biases toward their same-sex colleagues; Understand that potential rivalries may exist among elite women;Advance this area of inquiry beyond the search for general trends in gender-based biases that persist across actors

Hypotheses: At the lower and middle levels of organizational hierarchy, women demonstrate an ingroup bias by favoring their women peers in their evaluations. However, at the top levels of organizational hierarchy, women demonstrate a bias against their female peers because the tokenism situations that are present in the highest levels of most organizations lead women to focus on perceived threat when considering peer women senior executives.

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Study 1: Sample and Procedure

Participants completed the 360-degree survey online as part of 2005-2006 executive leadership courses (N=61)

40 men; 21 women36 were identified as top leaders and 24 were identified as middle managers

Ratings supplied by 227 work peers (156 men; 71 women)

Consent obtained from nearly all students

Survey distributed & completed online; approx. 20 min.

Participants received feedback as part of a course

Raters assured anonymity; ratings aggregated to preserve confidentiality of individual raters

The study consisted of a 2 (leader gender: male, female) x 2 (organizational level: top leader, middle manager) x 2 (rater gender: male, female) between-subjects factorial design

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Study 1: VariablesIV’s

Organizational level:The raters’ position or rank within the company was coded into a dichotomous variable: Top managers and Middle managers

DV’s

Leadership Effectiveness: Relationship-oriented and task-oriented behaviors, relational and personal leadership, respectively.

Relational leadership behaviors ( = .86). Concern, Respect, and Fairness

Personal leadership behaviors ( = .85). Vision, Competence, and Creativity.

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Figure 1. Mean ratings of leader effectiveness (personal leadership and relational leadership) by organizational level, leader gender, and rater gender (Study 1).

Personal Leadership

3

3.5

4

4.5

Male rater-Male leader

Male rater-Femaleleader

Femalerater-Male

leader

Femalerater-

Femaleleader

Top leader

Middle manager

Relational Leadership

3

3.5

4

4.5

Male rater-Male leader

Male rater-Femaleleader

Femalerater-Male

leader

Femalerater-

Femaleleader

Top leader

Middle manager

Figure 1.

Mean ratings of leader effectiveness (personal leadership

and relational leadership) by organizational

level, leader gender, and rater gender.

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Gender Differences in Leadership

Results, confirmed predictions: Compared with women middle managers, women top leaders evaluated their work peers more negatively. This difference in evaluations was not observed between men top leaders and men middle managers. Negative evaluations only occurred when competition amongst the women top leaders was perceived to be high (as in Study 1) or when it was explicitly manipulated as high (as in Study 2).

Implication: Managers and executives should be aware of how tokenism may negatively influence women leaders and how it may cause their perspectives to differ substantially from that of their male colleagues.

Documents

Leadership Determinants of Trust