Bolstering Workplace Psychological Well-Being Through Transactional and Transformational Leadership

Abstract

The psychological well-being of employees has significant primary and secondary effects on organizational performance and profitability. Despite this importance, the leadership, and related (e.g., organizational behavior, human resources, applied psychology) literatures have not adequately pursued the theoretical or empirical study of employee psychological well-being. Researchers have instead focused primarily on subjective well-being (e.g., job satisfaction, life satisfaction, and positive affect). We seek to make four contributions by (1) drawing from established theory on psychological well-being from applied, social, clinical, and developmental psychology to highlight a seven-component model of psychological well-being that applies to the workplace; (2) differentiating psychological well-being from subjective well-being, providing a deeper understanding of what constitutes well-being in the workplace and how it is formed; (3) integrating psychological well-being with transactional and transformational leadership theories to propose leader interventions to bolster each component of psychological well-being in followers; and (4) theorizing how the components of psychological well-being relate in unique ways to important organizational outcomes: task, contextual, and ethical performance criteria. Our intent is to provide propositions to encourage the field to reach beyond subjective well-being through theorizing new linkages between leadership, psychological well-being, and follower work behavior. We ultimately seek to enrich our understanding of the underpinnings of thriving and performance in the workplace.