Transformational leadership, initiating structure, and substitutes for leadership: a longitudinal study of research and development project team performance.

Transformational leadership, initiating structure, and selected substitutes for leadership were studied as longitudinal predictors of performance in 118 research and development (R&D) project teams from 5 firms. As hypothesized, transformational leadership predicted 1-year-later technical quality, schedule performance, and cost performance and 5-year-later profitability and speed to market. Initiating structure predicted all the performance measures. The substitutes of subordinate ability and an intrinsically satisfying task each predicted technical quality and profitability, and ability predicted speed to market. Moderator effects for type of R&D work were hypothesized and found whereby transformational leadership was a stronger predictor of technical quality in research projects, whereas initiating structure was a stronger predictor of technical quality in development projects. Implications for leadership theory and research are discussed.