Enhancing the impact of transformational leadership and team-building on project success : the moderating role of empowerment climate

Purpose: This study examines the mechanisms and conditions that influence how transformational leadership affects project success through the lens of social information processing theory. Design/methodology/approach: A dual-stage moderated mediation model was proposed wherein the effect of transformational leadership on project success is mediated by team building, and empowering climate moderates the direct and indirect effects at both the first and second stages. The model was tested based on 370 survey responses of project management practitioners from Pakistan's IT industry. The measurement model was analyzed using confirmatory factor analysis (CFA). Moderated mediation analyses were conducted using Hayes' PROCESS macro. Findings: The findings suggest that team-building partially mediates the effect of transformational leadership on project success. Furthermore, the conditional indirect effect of transformational leadership on project success via team-building is strengthened at both the first and second stages at higher levels of empowerment climate. Practical implications: It is recommended that project managers and project-intensive organizations should strive to cultivate an empowerment climate to fully realize the beneficial effects of transformational leadership behaviors in enhancing positive team outcomes and, consequently, overall project performance. Originality/value: This study broadly contributes to the literature on the influence of project managers' leadership styles on project outcomes. Specifically, we elucidate the role of empowerment climate as an important boundary condition that enhances the beneficial effects of transformational leadership. Furthermore, we extend the application of social information processing theory to the context of projects.