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    Industrial and Organizational Psychology, 7 (2014), 158177.

    Copyright 2014 Society for Industrial and Organizational Psychology. 1754-9426/14

    FOCAL ARTICLE

    What Have We Learned That Is Critical

    in Understanding Leadership

    Perceptions and Leader-Performance

    Relations?

    ROBERT G. LORD

    Durham University

    JESSICA E. DINH

    University of Akron

    Abstract

    In this article, we provide a brief review of the current and past research on leadership perceptions andperformance. We then describe four principles that have emerged from many decades of research, which canprovide new directions for future leadership theory and research.

    A leader is best when people barely knowhe exists, when his work is done, his

    aim fulfilled, they will say: We did itourselvesLao Tzu

    Leadership is as much of an art as it is a rolethat has significant impact on individuals,groups, organizations, and societies. Overthe last century, scores of theories andthousands of studies (Gardner, Lowe, Moss,Mahoney, & Cogliser, 2010) have beenfocused on understanding the nature of

    leadership. As the quote illustrates, we havelearned a great deal about what leadershipisand what it takes for leaders to be per-ceivedas effective (Kaiser, Hogan, & Craig,2008). However, we do not yet understandprecisely how leaders become effectiveas they influence individuals, groups, andorganizations (Kaiser et al., 2008).

    Correspondence concerning this article should be

    addressed to Robert G. Lord.E-mail: [email protected]

    Address: Business School, Durham University,United Kingdom

    In order to advance leadership theoryand research, we argue that the separation

    between perception and effectiveness isneeded, and this has motivated us to takestock of research in these two areas, whichwe do in a somewhat unusual manner.Rather than catalog empirical trendsor conduct a meta-analysis to estimatepopulation parameters, we opted for amore integrative, albeit more abstract andselective, assessment of the leadership fieldand how it has advanced during the last40 years. Our efforts focus on identifying

    four general principles that we believe aregrounded in both theory and empiricalresearch that also provide critical insightinto the processes of leadership. Our effortsprompted us to examine critical develop-ments in social cognition as they relateto leadership but also in work that viewsindividuals, groups, and organizations ascomplex adaptive systems that continuallyadapt to changing environments.

    In the sections that follow, we firstdescribe the historical context of leadershipresearch on perceptions, behavior, andeffectiveness to show how thinking within

    158

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    Understanding leadership perceptions and performance 159

    Table 1. Four Overarching Principles That Unify the Leadership Literature on Perceptionsand Effectiveness

    Principle 1. Leadership is a socially constructed, enacted process that involves bidirectionalinfluences among multiple individuals.

    Principle 2. An information processing perspective can be usefully applied to leaders, followers,

    and higher level units such as dyads, groups, and organizations.Principle 3. Leader effects are often indirect, being distributed across time and people.

    Principle 4. Looking backwards and looking forwards are quite different processes.

    these domains progressed over the last halfcentury. We then address four principlesand related themes, which are responsiblefor the dramatic progression observed inleadership theory and research in the order

    listed in Table 1. As well as developingprinciples, we also evaluate their implica-tions for developing leadership theory andeffective leadership practice.

    Historical Context for

    Understanding Leadership

    Perception and Effectiveness

    Perceptions

    Historically, leadership research empha-sized stable cognitive structures and traitsas important determinants of leadershipperceptions and effectiveness (Mann,1959). According to early leadershipcategorization theories, leadership percep-tion depended on cognitive categories orschemas known as implicit leadership the-ories(ILTs), which are used by perceivers toinfer leadership in others based on observed

    physical characteristics and traits or, alter-natively, successful unit performance. Todate, an extensive body of research showsthat ILTs include traits such as intelligence,dominance, sensitivity, strength, charisma,tyranny, and sensitivity, which serve as atemplate for determining whether or nottargets are typical leaders (Epitropaki &Martin, 2004; Lord, Foti, & De Vader,1984). For example, targets perceived asintelligent and dominant are likely identi-

    fied as leaders, whereas targets low on thesequalities are less likely to be classified asleaders.

    Perceptually, prototypical attributes areaccessed very quickly in ILTs (Dinh & Lord,2013; Scott & Brown, 2006) and therebycreate the feeling of having been observedeven when they were not actually present

    (Foti & Lord, 1987; Phillips & Lord, 1982).To illustrate, research on performance cueeffects(PCEs; Ensari & Murphy, 2003; Lord,1985; Lord & Maher, 1991) demonstratesthat knowledge of a leaders performanceaffects raters descriptions of that leadersbehavior, but these effects are greater formore prototypical items that are accessedfaster (Lord et al., 1984). PCEs reflectcommonsense or romanticized views of

    a leaders causal impact on a variety ofoutcomes (Calder, 1977; Meindl, 1995;Staw, 1975), but from a more scientificperspective, they reflect the effects of raterssystematic schemas as they influence theencoding and retrieval of information.

    The importance of ILTs in leadershipperceptions fostered research that exploredhow ILTs develop over time, their univer-sality, and their structure. Research in this

    domain showed that ILTs are developedat a young age (Keller, 2003), are univer-sally endorsed (although cultural variabilitydoes exist; House, Hanges, Javidan, Dorf-man, & Gupta, 2004), and exhibit stabilitywhen assessed longitudinally (Epitropaki &Martin, 2004). Also, research on the use ofILTs shows that, although traits can be usedindividually to predict leadership percep-tions and effectiveness (Judge, Colbert, &Ilies, 2004), analyzing ILT configurations or

    patternsof traits better predicts these lead-ership outcomes (Dinh & Lord, 2013; Foti& Hauenstein, 2007).

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    160 R.G. Lord and J.E. Dinh

    Effectiveness

    Individual dispositions have had a long his-tory in leadership research on effectiveness(Mann, 1959). Building on this trend, Judgeand colleagues (Judge, Bono, Ilies, & Ger-

    hardt, 2002; Judge et al., 2004) contributedseveral meta-analytic studies to the lead-ership field, which show that individualdifferences in intelligence and traits asso-ciated with the five-factor theory of person-ality (Costa & McCrae, 1985) significantlypredicted leadership perceptions and effec-tiveness. In fact, not only were Extraversion,Conscientiousness, Openness, and Neuroti-cism individually predictive of leadershipperceptions, in combination they signif-icantly predicted perceptions and effec-tiveness (Rs= .53, and .39, respectively;Judge et al., 2002). Thus, meta-analysis andthe five-factor taxonomy seemed to offera solution to the issue of relating indi-vidual differences among leaders to per-ceptions and effectiveness, an approachthat has been corroborated by even morerecent meta-analytic reviews (see DeRue,Nahrgang, Wellman, & Humphrey, 2011)

    and research on the genetics of leader-ship (Arvey, Rotundo, Johnson, Zhang, &McGue, 2006).

    Current Research on LeadershipPerceptions

    In summary, early work on leadership cat-egorization theories and ILTs emphasizedthe importance of seemingly stable traits

    and perceptual categories. However, begin-ning with research on ILTs in the 1980s, thesocial-cognitive revolution demonstratedthat leadership perception was affected bya variety of social and contextual fea-tures (Lord, Brown, & Harvey, 2001; Syet al., 2010). For example, leadership per-ceptions are subject to perceiver expecta-tions and biases (Eden & Leviatan, 1975;Rush, Thomas, & Lord, 1977; Weiss &Adler, 1981), and even followers own

    self-perceptions of leadership and follow-ership (Foti, Bray, Thompson, & Allgood,2012; van Quaquebeke, van Knippenberg,

    & Brodbeck, 2011). Other research showedthat perception may result from processesthat are embodied (e.g., Giessner & Schu-bert, 2007; Tiedens, 2001), physical (e.g.,Trichas & Schyns, 2012), or emotional innature (e.g., Wolff, Pescosolido, & Druskat,2002). Attention to these processes has ledto the development of theory and researchthat investigates the dynamics of leadershipperceptions as it is continually adapted to avariety of social contexts at different pointsin time (Hanges, Lord, & Dickson, 2000;Lord et al., 2001; Sy et al., 2010).

    Current Research on LeadershipEffectiveness

    As Kaiser et al. (2008) noted, leadershipresearch often examines factors that affectleadership perceptions rather than effec-tiveness. Among the studies that examineeffectiveness, however, attention is focusedon how individual dispositions, such astraits (Judge et al., 2004) and specific behav-iors (e.g., leading morally as an ethicalleader; Walumbwa et al., 2011), augmentor detract from a leaders performance.

    A significant limitation of a leader-centricapproach is it neglects the reality that lead-ers are embedded with complex organiza-tional environments (Marion & Uhl-Bien,2002; Uhl-Bien & Marion, 2009) that areuncertain, discontinuous, and continuallychanging (Gulati, Sytch, & Tatarynowicz,2012). Hence, even intentional choicesmay have unintentional consequences asmultiple factors and chance events cul-minate to advance or diminish organiza-

    tions (MacKay & Chia, 2013; Plowman,Baker, Kulkarni, Solansky, & Travis, 2007).These dynamic processes led organizationalscholars to consider the importance of time(Bluedorn & Jaussi, 2008; Sonnentag,2012), complexity in self and interpersonalprocesses (Uhl-Bien, Marion, & McKelvey,2007), and adaptability to meet the needs ofcomplex environments as processes evolvewith time (Carmeli & Halevi, 2009; Uhl-Bien & Marion, 2009). These perspectivescontrast with those that view leadershipeffectiveness as being determined by indi-vidual dispositions.

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    Understanding leadership perceptions and performance 161

    Summary

    Our brief review illustrates that over the pasthalf century, leadership research has tran-sitioned from views that understand leader-ship perception, behavior, and effectiveness

    as outcomes of static processes to views thatembrace the importance of context, socialdynamics, and time as factors that contin-ually impact the construction of leadershipby both leaders and followers. In the follow-ing sections, we present four principles thathave developed progressively over the lastdecade, which we believe are fundamentalto understanding how leadership researchhas advanced to where it is now and howit can advance in the coming decades.

    Four General Leadership Principles

    In order to bridge the divide betweenperceptions and effectiveness that has parti-tioned the leadership literature, we organizeour findings into the four broad unifyingprinciples that are summarized in Table 1.We argue that leadership perceptionsinvolve a socially constructed process that

    is clarified by focusing on how peopleprocess social information (Principles 1and 2). Then, we argue that leadershipoperates primarily through other peopleand across time, which complicates ourunderstanding of effectiveness (Principle 3).Last, we maintain that there is an importantdistinction between perspectives that lookbackwards and those that look forwards inunderstanding leadership and their effectson organizations (Principle 4).

    Principle 1. Leadership Is a SociallyConstructed, Enacted Process That InvolvesBidirectional Influences Among MultipleIndividuals

    Leadership is a social process that involvesiterative exchange processes among two(or more) individuals (Day, Harrison, &Halpin, 2009). As Shamir (2007) stressed,leaders and followers are coproducersof leadership, and in many effectivecollaborations, leadership is shared anddistributed among multiple people (Pearce

    & Conger, 2003). The use of sharedor distributed leadership structures hasbecome increasingly common in modernorganizations that rely on work teams tomaximize the organizations adaptability tochanging environments (Cannella, Park, &Lee, 2008). Compared to hierarchical lead-ership structures, horizontal or distributedleadership structures allow different indi-viduals to emerge as leaders based on theskills, talents, and abilities that they maypossess. Emergence, however, is a socialprocess where leadership is claimed bydifferent individuals at different times, andleadership is granted when others complywith leadership attempts (DeRue & Ashford,

    2010). Hence, leadership perception andeffectiveness can vary based on whoemerges as a leader and whether the leadercan satisfactorily meet current organiza-tional demands (Dinh & Lord, 2012).

    Leadership is also situated in that contextinfluences who leads (Hall, Workman,& Marchioro, 1998), why they lead(Chan & Drasgow, 2001), how they lead(House et al., 2004), and what they hopeto accomplish (Hunt, Boal, & Dodge,1999). In fact, context can influence whenwomen and ethnic minorities are perceivedas leaders, which occurs when contextsare chaotic (Ryan, Haslam, Hersby, &Bongiorno, 2011) or are more technicallyoriented (Sy et al., 2010), even thoughprototypical leaders are typically maleand white (Rosette, Leonardelli, & Phillips,2008). Context can also influence whenleadership interventions have the greatest

    impact on team effectiveness. For example,active leadership, which involves directleadership intervention in team processes,is not perceived to be effective unless thesebehaviors occurred when a self-managingteam encountered events that were noveland unexpected (Morgeson, 2005).

    Finally, leadership is socially constructed(Meindl, 1995), being tied to the influ-ence and perceptions of multiple parties(Hall & Lord, 1995; Lord, 1977) as well ascontexts that change over time (Chang &Johnson, 2010; Dulebohn, Boomer, Liden,Brouer, & Ferris, 2012; Lord & Maher,

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    162 R.G. Lord and J.E. Dinh

    1991). This socially constructed aspectalso is demonstrated in sensegiving andsensemaking when leaders convey mean-ing and when followers make sense of themeaning conveyed (Balogun & Johnson,2004; OMalley, Ritchie, Lord, Gregory,& Young, 2009; Weick, 1993). The socialconstruction of leadership also applies toleadership development as people reflectupon their present and past history (Dayet al., 2009; Ibarra & Barbulescu, 2010)and relational ties to social others (Keller,2003). For example, leadership develop-ment may be facilitated as leaders reflectupon past challenges (Avolio, Rotundo, &Walumbwa, 2009) that alter ones self nar-

    ratives and leadership self-perceptions. Inaddition, the quality of leader follower out-comes is shaped by the relationship qualityleaders share with followers, which changesover time based on the leaders perceptionof the followers characteristics and per-formance level (Jokisaari & Nurmi, 2009;Nahrgang, Morgeson, & Ilies, 2009).

    Applications to perception and effectiveness. In summary, leadershipperceptions and effectiveness reflect morethan the effects of target qualities as they aresocially constructed and involve processesthat are iterative, bidirectional, and occuramong multiple people. Consequently,leadership perception and effectiveness aremuch more variable than previously under-stood. In fact, targets may be perceived asleaders at one point but not the next. Inaddition, leadership perceptions may not

    equate to leadership effectiveness, a factthat is demonstrated when leaders achievepositive objective performance (e.g., byactively monitoring work teams), but arealso perceived by others to be ineffective(Morgeson, 2005). Leadership effectivenesscan also be defined objectively, such aswhen leaders improve the task performanceof individuals, groups, and organizations.However, leadership effectiveness can alsobe defined subjectively as organizationalmembers respond to leadership actionsthat promote positive work climates,employee well-being, social justice, or

    resource acquisition that in turn improveorganizational functioning. Interestingly,subjective and objective indicators of effec-tiveness can be pursued very differentlyas shown when leaders sacrifice businessmorals (e.g., use ruthless strategies) topromote survival against competitors(Ciulla, 2011).

    Principle 2. An Information ProcessingPerspective Can Be Usefully Applied toLeaders, Followers, and Higher Level UnitsSuch as Dyads, Groups, andOrganizations

    Attention to how information is processed

    offers many advantages for understandingthe source of a leaders influence andhow leadership is socially constructed. Forexample, knowledge is not learned or usedin a piecemeal fashion but is organized inlarger units known as schemas or mentalmodels that help guide social perceptions(Lord et al., 1984) and behavioral scripts(Foti & Lord, 1987). Likewise, motivationalprocesses are tied to goal-orientationstructures (Dragoni, 2005) and regulatoryfoci (Kark & Van Dijk, 2007) that may varyat different points in time to affect howcognitions and behavior emerge for the selfand others (Lee, Aaker, & Gardner, 2000).In addition, active self-identities (Ibarra& Barbulescu, 2010; Lord, Diefendorff,Schmidt, & Hall, 2010) have profoundeffects on motivation, affect, and inter-pretations of social phenomena. Becauseindividuals can influence these structures

    in others (Andersen & Chen, 2002),information processing perspectives allowscholars to understand the indirect effectsof leadership in terms of their momentaryor cumulative effects on such structures ateither individual or group levels of analysis(Dragoni, 2005; Hannah, Lord, & Pearce,2011; Lord, Hannah, & Jennings, 2011).

    In addition, information processingperspectives can provide a wealth ofempirical techniques for investigatingphenomena that occur both consciouslyand at subconscious levels of awareness.For example, habits (Neal, Wood, Wu, &

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    Understanding leadership perceptions and performance 163

    Kurlander, 2011), stereotypes and genderbiases (Devine, 1989; Eagly & Karau,2002), self-identities (Johnson & Lord,2010), and leadership perceptions (Lord &Maher, 1991) each operate using automaticprocesses that are more effectively assessedusing methodologies that do not requireconscious access. These may include theuse of implicit measures (Dinh & Lord,2013; Johnson & Saboe, 2011) or experi-mental paradigms that collect reaction timedata (Foti & Lord, 1987; Leavitt, Reynolds,Barnes, Schilpzand, & Hannah, 2012).This perspective also contributed to thedevelopment of explicit paradigms thathelped improve the accuracy of leadership

    evaluations by using visualization tech-niques (Naidoo, Kohari, Lord, & DuBois,2010) or by asking raters to use specificbehavioral incidences to improve episodicrecall (Baltes, Bauer, & Frensch, 2007).

    Perhaps the most profound contributionis that information processing perspectivesprovided scholars with a framework forunderstanding how information originat-ing from diverse sources is dynamicallyintegrated to inform leadership perceptionand behavior. On the basis of social-cognitive and neurological research,several systems that include symbolic,connectionist, emotional, and embodiedknowledge (Dinh, Lord, & Hoffman, 2014;Lord & Shondrick, 2011) are thoughtto influence many of the intrapersonaland interpersonal processes that relate toleadership. Leadership research typicallyfocuses on symbolic systems that operate

    serially and consciously, and thereforeincludes much of the literature on decisionmaking, strategy, and influence. Yet otherresearch has increasingly examined howconnectionist, emotional, and embodiedsystems also affect outcomes important toleadership. The relations of these threetypes of knowledge to leadership processesare examined in the next three sections.

    Connectionist systems. Connectionist mo-dels were proposed as models of categoryprototypes (Hanges et al., 2000; Lord et al.,2001) because they can operate as dynamic

    Input

    InputLayer

    HiddenLayer

    OutputLayer

    Excitatory

    Inhibitory

    Figure 1. A feed-forward connectionist net-work with excitatory and inhibitory linkagesconnecting an input layer to an output layerthrough a hidden layer. Shading is used torepresent activated units.

    systems that can adjust prototypes to newcontexts, allowing prototypes to changeas leader, followers, or context changed.Connectionist networks are composed ofdensely interconnected layers ofnodesandlinks, which allow different patterns tobecome active based on the kinds of per-ceptual input the network receives. Withinsuch networks, each node can be individ-ually meaningful (i.e., a localist connec-tionist networks) or meaning may be basedon the holistic configuration of the entirenetwork (distributed networks). Althoughsimple connectionist networks have a min-imum of two layers with a feed-forwardlinkage, more complex, biologically plau-sible systems have bidirectional connec-tions and multiple layers, some are hiddenbetween more observable input and outputlayers. Hidden layers allow the network torepresent complex relationships, which is

    further enabled by the networks ability tosend information forward and backwardsacross the layers. Figure 1 illustrates asimple feed-forward connectionist networkwith excitatory and inhibitory linkages thatconnect an input layer to an output layerthrough a hidden layer.

    Recurrent connectionist networks havespecial properties that make them particu-larly suitable for representing dynamic lead-ership outcomes like perception, behavior,and effectiveness. Specifically, these net-works can learn patterns by adjusting theactivation weights among linkages (making

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    164 R.G. Lord and J.E. Dinh

    some pathways more or less difficult to acti-vate), and they can complete patterns whenonly a few nodes have been activated byinputs. Thus, if prototypes are constructedby recurrent networks, some category-consistent nodes can become activate eventhough they had not been directly observed(Foti & Lord, 1987; Phillips & Lord, 1982).This feature accounts for PCEs (Rush,Phillips, & Lord, 1981; Shondrick, Dinh, &Lord, 2010) and gap-filling processes thatoccur when raters try to rememberprototype consistent leadership behaviorsor traits that were not actually observed.

    Reconceptualizing the structure of ILTsas a connectionist network also accounts for

    the variability observed in leadership per-ceptions as prototypes are actively recon-structed based on observed momentarycues and events (e.g., Sy et al., 2010)rather than depending on matching inputsto static prototypes. Finally, because theconnections among traits allow ILTs to beprocessed holistically as a global networkpattern, leadership prototypes can changein a discontinuous manner when unlikelyevents cause its structural pattern to shift(Foti, Knee, & Backert, 2008). The signif-icance of patterns is further demonstratedin research that utilizes pattern approachesto predict leadership perceptions (Dinh &Lord, 2013; Foti & Hauenstein, 2007;Trichas, Schyns, & Lord, 2013), which out-perform methods that use individual traits.

    Paralleling their use in explainingILTs, connectionist networks also providean information processing structure that

    accommodates a number of additionaltypes of variability. For example, the vari-ability that is observed in individual behav-ior (Fleeson, 2001) can be modeled byconnectionist networks (Read et al., 2010).In addition, the self-concept can be con-ceptualized as an interconnected structurecomprised of nodes that represent knowl-edge, goals, values, and identities that influ-ence behavior upon activation (Dinh &Lord, 2012). The operation of such networkscan be influenced by a variety of exter-nal constraints that include the actions ofleaders (Lord & Brown, 2004). For example,

    an independent self-identity may becomeactive due to salient contextual cues (e.g.,injustice), which motivates behaviors thatprioritize individual distinction and separa-tion from others (Johnson & Lord, 2010).Likewise, behaviors that emphasize col-lectivism, risk prevention, and inner-groupharmony may be more likely when an inter-dependent self-identity is salient (Lee et al.,2000).

    Emotions and embodiment. In the lastdecade, the influence of emotions andembodied processes on leadership percep-tions has been increasingly recognized.Emotions are processed in subcortical struc-

    tures (amygdala, anterior cingulate cortex,and limbic system), and they alert individu-als to potential benefits or dangers in onesenvironment (Panksepp, 2000). Hence, it isnot surprising that this processing systemhas important consequences on leadershipperceptions. For example, affect is a criticalcomponent of charismatic/transformationalleadership ratings (Bono & Ilies, 2006;Naidoo & Lord, 2008), with the raters likingof a target having relations to the dimen-sions underlying transformation leadership(Brown & Keeping, 2005). Because affec-tive reactions have a critical role in howmeaning is constructed, they may lead tomore accurate memories rather than mea-surement error (Naidoo et al., 2010).

    With regard to leadership effective-ness, affect influences decision making(Blanchette & Richards, 2010), creativity(George & Zhou, 2007), and motivation

    (Elliot & Thrash, 2002). George and Zhou(2007) show that cycling between negativeand positive affect facilitates creative think-ing as negative affect increases attentionto detail, which can lead to the identifi-cation of a solution that is broadened cre-atively when positive affect is experienced.Likewise, positive and negative affect areassociated with approach and avoidancedimensions (Neumann & Strack, 2000) andthereby drive behavior, although in differentways (Lee et al., 2000).

    One interesting way that target emo-tions can affect leadership perceptions is

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    Understanding leadership perceptions and performance 165

    through its influence on embodied sys-tems. Embodied systems involve the useof brain structures related to sensory,motor, or proprioceptive systems as anadditional type of knowledge that auto-matically affects a wide range of pro-cesses. For example, a process referredto as emotional contagion (Niedenthal,Barsalou, Winkielman, Krauth-Gruber, &Ric, 2005) occurs when perceivers mimica targets emotional expressions, whichthen elicits the appropriate emotion in per-ceivers through facial feedback processes.Hence, embodied processes based on facialmimicry create an automatic means foremotional transmission to occur between

    individuals. Research shows that emo-tional contagion is a critical component ofemotional understanding (Shamay-Tsoory,2011) and sensemaking (OMalley et al.,2009), and is a source of influence bycharismatic leaders (Bono & Ilies, 2006;Johnson, 2008). In fact, leaders can affecthow followersfeel(positively or negatively)through their own emotional expressions(Bono & Ilies, 2006; Johnson, 2008).

    It is important to understand thatembodied processes can be based onsensory, motor or proprioceptive input(e.g., morphological characteristics of thephysical body), in addition to its jointinfluence with emotional systems. In fact,embodied processes can affect leadershipperceptions as shown when height orvertical distance (even as represented inabstract graphs) increases a leaders per-ceived dominanceandpower (Giessner &

    Schubert, 2007). Dynamic aspects of vocalqualities also have important embodiedeffects related to leadership perceptions.For example, DeGroot, Aime, Johnson, andKlumper (2011) used computer softwareto conduct vocal spectral analysis forinauguration speeches for U.S. presidentsand Canadian prime ministers and foundthat vocal attractiveness was significantlycorrelated with leadership effectiveness asrated by historians (= .35). Behaviorally,physical embodiment can lead to theactivation of an interdependent identityamong interactional partners (Ashton-

    James, van Baaren, Chartrand, Decety, &Karremans, 2007), facilitate decision mak-ing (Dijksterhuis & Nordgren, 2006), as wellas influence ethical or unethical responding(Gu, Zhong, & Page-Gould, 2012).

    Applications to perception. An importantimplication of the information processingperspective is that it seems very unlikelythat perceivers can isolate any particu-lar aspect (behavior, affect, intelligence) oftargets independently from other aspectsand processes. Instead, it is much morelikely that both perceptions and behav-iors emerge as an outcome of the dynamicinteractions among symbolic, connection-

    ist, emotional, and embodied systems. Forexample, person perception is affected bythe combination of targets and perceiversemotions (e.g., sad, happy), implicit andexplicit cognitions (e.g., stereotypes, expec-tations), and physical characteristics (e.g.,facial structure; Freeman & Ambady, 2011).Similarly, behaviors and decisions emergefrom the dynamics among neural systemsthat process emotions, proprioception, con-sciousness, and more automatic cognitions(Dehaene & Naccache, 2001).

    This principle also implies that thepredominant methodology for studyingleadership (Hunter, Bedell-Avers, & Mum-ford, 2007), which includes retrospectivemeasures (e.g., questionnaires, surveys),necessarily reflects much more than thetraits or behaviors they are thought tomeasure. Therefore, they should not beused as a technology for the scientific study

    of behavioral level leadership processes.This is simply asking more of raters andmeasurement technology than any of thesecomponents can deliver. There are simplytoo many factors that can affect behavioraldescriptions in addition to the actualbehavior of leaders, and many of theseextraneous factors may be systematicallyrelated to the dependent variables leader-ship processes attempt to explain as Staw(1975) showed many years ago. However,it should also be recognized that summaryperceptions of others and the way that wereact to those perceptions can be important

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    166 R.G. Lord and J.E. Dinh

    indicators of general social processes (Lord,1985). Specifically, they can reflect howobservers classify others in terms of degreeof leadership, how observers feel at themoment, as well as observers theory ofmind for how others are thought to behaveor are expected to behave.

    Leadership and Performance

    Outcomes

    Principle 3. Leader Effects Are OftenIndirect and Distributed Across Time andPeople

    Performance on most tasks can be decom-posed into underlying skills, which can be,

    in turn, judged as performance occurs. Forexample, playing a cello requires knowl-edge of finger positioning and bow move-ment, which are skills that are readilyobserved and evaluated as cellists playtheir instruments. However, the effective-ness of leaders in modern organizationsis not as transparent. The difficulty is thatthe underlying skills that produce effectiveorganizational performance are less clear,especially because performance involvesthe efforts of multiple individuals actingwithin environments that are discontinu-ous and unpredictable (MacKay & Chia,2013), and performance may occur longafter leadership processes. For example,Day and Lord (1988) noted that the lagsbetween changing CEOs and their effectson organizational performance may require23 years to take full effect. In addition,Jaques (1990) estimates that the time it

    takes to influence performance increaseswith organizational levels and may be upto 10 years for the highest organizationallevels. However, leaders do influence per-formance (Kaiser et al., 2008), as illustratedby the fact that CEOs account for 14%,20%, 45%, or 50% of the variance in per-formance (Day & Lord, 1988; Joyce, 2005).What is less clear is precisely how leadersachieve organizational effectiveness.

    The difficulty in understanding thelink between leaders and organizationalperformance is that leaders operate throughfollowers, who have more proximal effects

    on organizational outcomes (Lord &Brown, 2004). Furthermore, this difficultyis compounded because followers arenetworked within complex relationalsystems that determine how informationis distributed and integrated within groupsand organizations over time (Balkundi &Kilduff, 2006; Ployhart & Moliterno, 2011).Relational systems also control organiza-tional members access to vital resources(Morrison, 2002) and can lead to thedevelopment of shared cognitions, affect,and behavior between and among mem-bers (Bingham & Kahl, 2013). In addition,momentary structures, such as a teamsshared interpretation of an event (i.e.,

    sensemaking; Balogun & Johnson, 2004),desired goals (Mathieu & Rapp, 2009), andcollective efficacy (Gully, Incalcaterra,Joshi, & Beaubien, 2002), can affect howorganizational members communicate andexchange resources with one another.Consequently, the structure of relationalnetworks function as a type of constraintthat may make certain types of information,knowledge, resources, and people moreor less available to the organization as awhole, thereby expanding or limiting thetypes of outcomes leaders and followerscan achieve (Gulati et al., 2012).

    On the surface, this principle impliesthat in addition to having keen insightto the organizations goals and admin-istrative tasks, leaders must also havea firm appreciation of how the dynam-ics and fluidity of social structures affectorganizational potential over time (Gulati

    et al., 2012). That is, they may have well-developed expertise and an understandingof people in social systems that may takemany years to develop (Day et al., 2009;Lord & Hall, 2005). Given the complex-ity of an organizations social structure,one approach to understanding the linkbetween leadership and organizational per-formance is to adopt a reverse engineer-ing approach as suggested by Lord andBrown (2004), beginning with theories offollower, group, and organizational perfor-mance and then asking how leaders caninfluence those processes. In other words,

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    Understanding leadership perceptions and performance 167

    we should articulate the mediating pro-cesses that are external to leaders beforeaddressing aspects that are internal to lead-ers. Thus, theory building would involvea follower (F)performance process (P),followed by a leader (L) follower linkagethat would indicate how leaders could affectmediating mechanisms in followers. By par-titioning this process into two stages (i.e.,an intrapersonal and interpersonal stage),theory can specify the leadership skills andabilities that affect followers, which cascadeto influence organizational performance. Inother words, although leadership influencesgo from LFP, leadership theory build-ing should go from (P F) L if we are

    to build a scientifically based theory of aleaders impact on performance.

    This (P F) L approach also hasthree practical advantages. First, follow-ers, groups, and organizational systemsare more proximal to performance thanis leadership, and so attending to followerprocesses simplifies construct measurementand it also facilitates causal understanding.Second, knowledge of these interveningmechanisms can help specify and empir-ically examine associated skills and behav-iors in leaders. Third, leader-based interven-tions (selection, training, or a combinationof both) that relate to these interveningmechanisms could then be developed andevaluated for their effectiveness. In short,this perspective calls for the developmentof constructs for theories of leadership per-formance from validated theories of perfor-mance rather than common sense, linguis-

    tically based constructs provided by verbaldescriptions of leader behavior (or personal-ity traits; see Calder, 1977, and Uher, 2013,for detailed discussions of these issues).

    Mediating leadership processes. There aretwo important classes of mediating struc-tures and processes that should be empha-sized by leadership theories. One classinvolves variables that have direct effectson others, as shown in Figure 2. Forexample, leaders can directly impact theperformance of followers by providing themwith task-specific feedback, resources, and

    support (e.g., Allen, Shockley, & Poteat,2010). At more aggregate levels, teamperformance can be affected by who aleader assigns specific tasks to in a team(Humphrey, Morgeson, & Mannor, 2009) orknowing when and how to intervene duringdifferent team stages (Hackman, Wageman,& Fisher, 2009; Morgeson, 2005). Lead-ers can also directly affect the performanceof organizations by implementing appropri-ate strategies and policies (Boeker, 1997)and through efforts to build organizationalnetwork ties (Gulati et al., 2012).

    A second class of variables has indirecteffects on others, which is also shown in themiddle portion of Figure 2. For example,

    leaders may promote a specific goal oridentity in followers, which then influencefollower self-regulation and eventual per-formance (Lord & Brown, 2004). Similarly,leaders can create group-level social iden-tities (van Knippenberg, van Knippenberg,De Cremer, & Hogg, 2004) that impactgroup member self-regulation. The effects ofleadership can also be observed indirectlythrough the organizational culture and cli-mate that leaders create by role modelingor by making explicit behavioral reinforce-ments (e.g., Schaubroeck et al., 2012).

    Applications to effectiveness. Objectivelymeasuring a leaders effect on orga-nizational performance are difficult asleadership effects are often indirect, mayrequire months or years to occur, andinclude criteria that are subjectively defined(e.g., employee commitment, satisfaction,

    ethical behavior, organizational citizenshipbehavior, human capital). Therefore,insight into effective leadership skills maybe difficult to develop given that effectiveperformance involves the cognitions,emotions, goals, and relational ties amongindividuals and organizations. Each of thesedomains may require a different skill, whichmay become more or less critical with theirlevel in organizations (Mumford, Campion,& Morgeson, 2007). Complicating thepicture further, Days (2012) work onleadership development indicates that mostleaders believe leadership skills are learned

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    168 R.G. Lord and J.E. Dinh

    o ower

    er ormance

    Objective

    Perf. Evaluation

    ubjective

    B W

    Feedback Seeking

    Effort

    eam

    er ormance

    Objective

    Perf. Evaluation

    ub ectiveroup ohesion

    CB/CWB

    rgan zat ona

    Per ormance

    Objective

    apital Gain

    ub ective

    uman apital

    ater a esources

    Leadership

    Organizational LoA

    Social Network Structure

    Culture & Climate

    Strategy & Policy

    Role Modeling

    Group LoA

    Goal Orientation Climate

    Group-Regulatory Structures

    Behavioral Integration

    Procedural Justice

    Collective Vision

    Goals

    Dyadic LoA

    Affect

    Values & Identity

    Sensemaking

    Self-Regulation

    Org. Commitment

    LMX & Trust

    Interpersonal Justice

    Sensegiving

    Empowerment

    Follower

    Performance

    Objective

    Perf.Evaluation

    Subjective

    OCB/CWB

    Feedback Seeking

    Effort

    Team

    Performance

    Objective

    Perf. Evaluation

    SubjectiveGroup Cohesion

    OCB/CWB

    Organizational

    Performance

    Objective

    Capital Gain

    Subjective

    Human Capital

    Material Resources

    Individual LoA

    Self-Complexity

    PersonalityExpertise

    Tenure

    Leadership Style

    Direct Effect

    Organizational Resources

    Direct Effect

    Regulating Team Task Assignments

    Crisis Management

    DirectEffect

    Coaching/Feedback

    Resources & Support

    Figure 2. Direct and indirect leadership effects on dyadic, group, and organizationalperformances.

    through experience, and leadership devel-opment may take a long time and followdifferent trajectories for different individuals(Day & Sin, 2011). Thus, leadership effec-tiveness may vary along an individualsdevelopment time trajectory. Last, leadersmay also be deemed ineffective despite theirhigh level of expertise when chance events(i.e., latent uncertainties) and unforeseeablecircumstances that exist outside of a leaderscontrol irreversibly impact organizationalprocesses (MacKay & Chia, 2013).

    Using a mediational framework, weargue that efforts to understand how leaders

    affect the performance of organizationsrequires that scholars attend to followerprocesses and the dynamics of social sys-tems (i.e., FP) that impact organizationalperformance, in addition to direct leadereffects (i.e., LP). Consequently, this per-spective invites scholars to consider howuncertainty and the nonlinear dynamicsthat define social systems and intrapersonalprocesses (Plowman et al., 2007; Uhl-Bienet al., 2007) interactively influence leader-ship effectiveness on a moment-to-momentbasis, a concept that is further explained inPrinciple 4.

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    Understanding leadership perceptions and performance 169

    Principle 4. Looking Backward andLooking Forward Are Quite DifferentProcesses

    To understand the present and distantfuture, people often look into the past

    to find patterns (MacKay & McKiernan,2004) that explain the present and predictthe future. This process helps reduce theanxiety that often accompanies the uncer-tainty associated with the future (Hirsh,Mar, & Peterson, 2012). Also, people lookbackward as a means to learn how tomanage difficult aspects of social relationssuch as trust violations (Gillespie & Dietz,2009). Leaders can also look backward

    to access stories and narratives that pro-vide followers with a mental frameworkfor interpreting events (Weick, 1993). Suchsensegivingcontributes to perceived lead-ership effectiveness by reducing uncertaintyand by enabling leaders to better coordinatefollowers.

    In addition, looking toward the pastcan help simplify information processingin the present by narrowing the types ofinformation one considers when making

    crucial decisions and judgments. How-ever, this process also restricts the rangeof alternatives considered and may pre-vent individuals from foreseeing alternativeoutcomes that have an equal likelihood ofoccurring as the literature on path depen-dence (Koch, 2011), hindsight bias, andforesight bias has shown (e.g., Koehler,White, & John, 2012; MacKay & McKier-nan, 2004). Moreover, looking backward

    assumes that the past easily generalizesto the future, which may not be realis-tic given that organizational processes arecontinually affected by the dynamics thatexist at multiple organizational levels, aswell as by chance and unforeseeable events(MacKay & Chia, 2013). Leaders may haveless control and foresight over the trajectoryof organizations than typically assumed(MacKay & Chia, 2013), and the manypossible pathways (with each leading to dif-

    ferent organizational outcomes) that existin the future compound the challenge ofeffective leadership. As Steve Jobs famously

    noted, You cant connect the dots look-ing forward; you can only connect themlooking backwards (Jobs, 2005). Hence,the past is more understandable than thefuture. Moreover, reasonable decisions andconclusions based on the past may not beeffective in the coming future because thefuture may evolve in ways that are incon-sistent with the past.

    Lord, Dinh, and Hoffman (in review)address this issue by using quantumphysics concept of a probability wave (amathematically derived landscape that isused to describe an electrons position inspace as is shown in Figure 3) to explainhow uncertainty characterizes the future

    of many individual and organizationallevel phenomena. Probability waves areused by quantum physicists (Greene, 2005,2011) to explain how electrons appearto simultaneously occupy many differentlocations as they travel through space. Forelectrons, travel through time and space isprobabilistic rather than reflecting a singletrajectory connecting the past to the future(Greene, 2005, 2011). It is only when ameasure is taken at a specific point intime that probability waves collapse andan electron occupies a specific locationin space. Thus, measured locations donot accurately represent the underlyingdynamics of travel through time and space.

    Lord et al. (in review) applied the samelogic to social systems, arguing that whenwe look backward, we see a collapsedprobability wave that overemphasizes thecertainty in dynamic system, just as an

    Figure 3. Probability wave of an electrontraveling through space. The probability

    of an electron being at any position isproportional to the height of the wave atthat point.

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    170 R.G. Lord and J.E. Dinh

    electron seems to be in one position whenit is measured. However, they argued thata probability wave is a more appropriateway to represent the future because itimplies that individual and organizationalevents that have yet to occur can unfoldin an infinite number of ways much likean electron could occupy many differentregions in space. Probability waves alsorepresent many alternative pasts or presentsthat could have occurred but did notactually happen. Some of these alternativepasts or presents may be more consistentwith future circumstances than the pastthat was actually experienced. For example,an organization or governmental unit that

    is currently in a munificent environmentand plans for the future based on anextension of that environment might fail torecognize that the future could just as easilyreflect scarcity as munificence. For suchreasons, Lord et al. argue that probabilitywaves that represent multiple trajectoriesfor social units traveling across time aremore characteristic of how dynamic systemsoperate than models that generalize from aspecific past to future states. This is becausethe present may have occurred becauseof a random confluence of factors; thefuture, in contrast, may be more consistentwith alternative presents that could haveoccurred but did not. Because probabilitywaves represent many presents and theirassociated paths to the future, they providea better representation of such dynamics.

    Lord et al. (in review) also maintain thatmuch of the variability represented by prob-

    ability waves can be understood by viewingsocial units as dynamic systems. In such sys-tems, the manner in which organizationalevents unfolds depends on how dynamicindividual, group, and organizational pro-cesses (see Figure 2 using Principle 3)interact to constrain or collapse a prob-ability wave, thereby producing a unitaryoutcome that is experienced as the present.However, they also argue that the presentcould have been different if these socialprocesses had been slightly different, andso microdynamics can lead to significantunforeseeable change as described by the

    butterfly effect from chaos theory (Lorenz,1995).

    Technically speaking, these individual,group, and organizational processes func-tion as constraints that limit the range ofpossibilities that can emerge in dynamicsystems. As an example of an individuallevel constraint, individuals can experienceacute anxiety from a fearful event thatconstricts goal setting until the aversivestate is reduced or eliminated (McGregor,Nashville, Mann, & Phills, 2010). At higherlevels, group norms and organizational cul-tures (e.g., ethical culture) are constraintsthat modulate the morality of groups andorganizations (e.g., Schaubroeck et al.,

    2012). In addition, constraints can betemporally stable, such as an organizationsstructure (e.g., enabling vs. coercivestructure), or temporally variable, such asindividual affect (Kuppens, Oravecz, &Tuerlinckx, 2010) or group membership(Smith-Jentsch, Kraiger, Cannon-Bowers, &Salas, 2009).

    Importantly, the effects of processingconstraints cut across multiple organiza-tional levels and so contribute to the non-linearity of dynamic systems in real time byaffecting processes that occur in higher andlower level organizational systems (Lordet al., in review). For example, constraintsthat affect the kinds of skills, abilities,and knowledge that one can access at agiven moment in time (e.g., salient iden-tities, emotions, goals; Lord, Diefendorff,et al., 2010; Lord, Hannah, et al., 2011)can escalate upwards to constrain more

    aggregate level phenomena, such as groupcomplexity (Hannah et al., 2011), teamdynamics (Crawford & LePine, 2013), andeven organizational human capital (Ploy-hart & Moliterno, 2011), which change ona moment-to-moment basis. However, con-straints also operate horizontally, such aswhen ingroup dynamics affect leadershipemergence in shared teams (DeRue & Ash-ford, 2010), and downward, such as whenethical organizational cultures modulateindividual behavior (Schaubroeck et al.,2012). Thus, systems of constraints intro-duce uncertainty and complexity in how

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    Understanding leadership perceptions and performance 171

    organizational outcomes emerge, whichmay not be easily predicted or foreseen bylooking backward. Such perspective con-trasts with those that view leaders as havingcomplete control over the fate of theirorganizations.

    It is important to recognize that con-straints strengthen as the future nears thepresent, in part because the future thenbecomes situated in a real person, group, ororganizational context, creating emotionaland embodied constraints that affect cog-nitions and motivation. Thus, the distantfuture is highly abstract, but the near futurebecomes more experiential as it is under-stood and enacted by people and organi-

    zational units (Gavetti & Levinthal, 2000).Consequently, we maintain that to under-stand many processes, we should focuson how the future becomes the presentrather than on how the past and presentcreate the future. In other words, we shouldadopt a different orientation toward time tounderstand the emergence of the present.

    Applications to perception and effectiveness. This perspective has severalsignificant implications for understandingleadership perception and effectiveness.One implication applies to thinking ofsocial perceptions in terms of probabilitywaves. When we look backward at behav-iors of others, we see only one of manypossible behaviors they might have pro-duced because we view a collapsed ratherthan complete probability wave. Further,we interpret behavior as being invariant

    characteristic of the person and explain itin terms of their personal qualities. Thisfundamental attribution error (Ross, 1977)is well known. Applied to leadership,we tend to interpret good outcomes asreflecting personal capacities of leaders asis illustrated by the PCE described earlier,and in general, we build romantic beliefsthat overemphasize a leaders capacityto control outcomes (Meindl, 1995).Backward-looking personality measuresmay be subject to similar distortions thatunderemphasize the surprising amountof moment-to-moment variability that

    Fleeson (2001) discovered using alternativemethodologies.

    Turning to effectiveness, leaders mayrely on previous experiences and narrativesto craft an interpretation of current eventsthat may enhance leadership perceptionsby simplifying complexity and reducingexperienced anxiety among organizationalmembers. However, they may not increaseeffectiveness. Leadership expertise devel-ops slowly (Day et al., 2009), and therefore,the wisdom one accumulates throughexperience may not generalize to currentcontexts. Also, relying on experientialwisdom, which is a backwards-looking per-spective (Gavetti & Levinthal, 2000), may

    prime leaders to identify solutions to knownproblems rather than to consider how mul-tiple processes can converge to impact thelong-term survival of the organization. Toillustrate, MacKay and Chia (2013) describehow declining business and financial loanrestrictions led leaders at an automotivecompany to make a series of strategicchanges and liquefy its nickel hedge togenerate much needed revenue to maintainoperations. Although these responsesaddressed one problem, previously unex-perienced events that is, the decline ofthe automotive industry and the increasingpopularity of hybrid automobiles werenot satisfactorily addressed by leadershipand eventually combined with a series ofchance events (e.g., political trade embar-gos, economic downturns) to underminethe companys long-term survival. In othercontexts, looking backward can create a

    cognitive blinder that discourages individ-uals from identifying solutions that wouldotherwise be helpful in novel contexts(Koch, 2011). As these examples illustrate,looking backward and looking forwardare quite different processes and each hassignificant consequences on leadershipperceptions and effectiveness.

    Differences in looking backward andlooking forward also create methodologicalchallenges for scholarly research attempt-ing to understand the effectiveness ofleaders. In fact, the dominant method-ology for investigating leadership utilizes

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    172 R.G. Lord and J.E. Dinh

    retrospective questionnaires that ask lead-ers and followers to reflect on experiencedconstructs, which are then used to predictfuture behavior. As such, retrospective tech-niques assume continuity between past andfuture outcomes such that behaviors thatwere previously successful will carry for-ward to predict future effectiveness, whichmay not necessarily hold. This problem alsoextends beyond the leadership realm, asmost organizational science builds modelsbased on past behaviors or processes andoutcomes, and expect that these modelswill generalize to the future. But as ourdiscussion of Principle 4 illustrates, thisgeneralization will occur only when key

    constraints remain the same. New method-ologies and new forms of theory buildingand theory testing may be required to avoidsuch difficulties.

    Conclusions

    In this article, four principles weredescribed that capture the foundationalthemes in research on leadership percep-tions and effectiveness. These principleshighlight that leadership processes arejointly constructed by leaders and followersas part of ongoing, contextually specificsocial processes. Leadership perceptionsare backward-looking, contextually sen-sitive creations of dynamic connectionistsystems that integrate a variety of cognitive,emotional, and embodied processes thatmay operate above and below the level ofconscious awareness. Yet, we interpret such

    perceptions as reflecting stable character-istics of leaders that will generalize to thefuture. In many instances, this assumptionmay not be warranted, and it opens the doorfor research and theory to explore how thedynamics among simultaneously occurringcognitive, emotional, and embodied pro-cesses impact the emergence of leadershipperceptions on much shorter timescales.

    Although the majority of leadershipresearch has examined the influence ofleadership perceptions, rather than effec-tiveness (Kaiser et al., 2008), the availableliterature shows that effectiveness is also

    impacted by a confluence of multi-levelprocesses that evolve nonlinearly in waysthat may be unforeseeable or beyond aleaders control. Many of these processesinvolve other individuals because a leaderseffects are distributed across both indi-viduals and time. Further, there are bothdirect effects of leaders and effects thatoperate through a variety of interveningstructures. Consequently, time is a criticalelement in understanding leadership effec-tiveness because the interactive processesoccurring at multiple organizational levelsconverge to determine emergent outcomes.As the delays between a leaders actionsand results increase, it becomes likely that

    critical constraints will also change, therebycreating unintended consequences for lead-ership effectiveness. Related to this issue,we proposed that looking backward is dif-ferent from looking forward because thefuture may be determined by aspects ofenvironments that are not represented inthe past. Thinking in terms of probabilitywaves, multiple realities, and a differentorientation toward time can help organiza-tional leaders understand the past and planfor the future more effectively.

    Overall, research on leadership percep-tions and effectiveness has made significantadvances in the last half century; how-ever, efforts to further theory on theseoutcomes will require that scholars clearlydistinguish between perceptions and effec-tiveness as separate constructs that each usedistinct processes. In addition, new theoret-ical frameworks will be needed to clarify the

    processes that contribute to perceptions andthose that influence effectiveness; and thisclarification may involve emphasizing thedifference between looking backward whenperceiving leaders and looking forward tounderstand emerging performance.

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