We develop a model in which transformational leadership bolsters followers' internalization of core organizational values, which in turn influences their performance and willingness to report peers' transgressions. The model also specifies a distinct process wherein transformational leadership enhances follower performance by promoting followers' role self-efficacy. We tested the model on 2 large units (i.e., companies) of soldiers undergoing training and socialization. The study bracketed changes in soldiers' internalization of the organizational values and role self-efficacy over a 14-week period. The results support the widely held but empirically unestablished views that transformational leadership promotes change in value internalization and that this partially explains its influence on follower performance. Findings also indicate a distinct intervening process through which transformational leadership promotes performance by enhancing followers' beliefs in their own capabilities (i.e., self-efficacy). This research thus shows that 2 key processes both contribute to the understanding of how transformational leadership transforms followers and influences their behavior.
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