Contents lists available at ScienceDirect Journal of Business Research journal homepage: www.elsevier.com/locate/jbusres A dual-process contingency model of leadership, transactive memory systems and team performance Daniel G. Bachrach a, ⁎ , Ryan Mullins b a Department of Management, Culverhouse College of Business, University of Alabama, United States of America b Department of Marketing, College of Business, Clemson University, United States of America ARTICLE INFO Keywords: Transactive memory systems Leadership Market dynamism Sales team performance ABSTRACT In complex markets, use of teams is becoming more prevalent to capitalize on shared knowledge and expertise across members – often called transactive memory systems (TMS). For organizations to execute and benefit from a transactive memory approach, it is critical to improve understanding of how leadership and external en- vironments influence translation of TMS into improved performance. Drawing on leadership, transactive memory and contingency theories we examine internal and external factors to explain team performance via TMS. Using data from 79 sales teams in a Fortune 250 industrial goods and services firm, we find that trans- formational leadership has a stronger relationship with TMS in smaller teams and transactional leadership has a stronger relationship with TMS in less tenured teams. Finally, our results also indicate that the strength of the relationship between TMS and team performance depends on market dynamism. Implications of these results for theory and practice are discussed. 1. Introduction Progressively complex work in organizations and the consequent widespread adoption of teams has led to considerable focus on drivers of team performance (Kozlowski & Bell, 2003; Salas, Stagl, & Burke, 2004). This includes a proliferation of research on knowledge processes such as transactive memory systems (TMS; Chiang, Shih, & Hsu, 2014; Lewis, 2003). TMS, which is defined as the cooperative division of labor for learning, remembering and communicating relevant team knowl- edge (Hollingshead, 2001; Wegner, 1986), has recognized collective performance consequences across a range of contexts (Bachrach et al., 2018; Bachrach, Mullins, & Rapp, 2017; Faraj & Sproull, 2000; Lewis, 2004; Michinov, Olivier-Chiron, Rusch, & Chiron, 2008; Rau, 2005). While a number of process-related factors such as intimacy (Wegner, 1986), communication frequency (Lewis, 2004), prior learning (Lewis, Lange, & Gillis, 2005), familiarity (Lewis, 2004), and social network connectivity (Lee, Bachrach, & Lewis, 2014) have been associated with TMS, an intriguing question has emerged regarding the important antecedent role that leadership can play (Hammedi, van Riel, & Sasovova, 2013; Hood, Bachrach, & Lewis, 2014), which is our focus in the current study. For example, socio-cognitive processes underlie the team level in- formation processing on which TMS depends (Ellis, 2006; Wegner, 1995). Hammedi et al. (2013) argued that transformational leadership – defined as leadership that causes change in individuals and social systems (Bass, 1985; Bono & Judge, 2004) – can strengthen the co- ordinated social interactions and shared understanding (Day, Gronn, & Salas, 2004) necessary for TMS. Further, although evidence from the leadership domain suggests that transformational leadership (TFL) may generate more productive outcomes than transactional leadership (TAL) (Birasnav, 2014; Elenkov, 2002 – defined as leadership through rewards and incentives (e.g., Bass, Avolio, Jung, & Berson, 2003; Judge & Piccolo, 2004) – tangible inducements also may mechanically ex- pedite the emergence of TMS (Hood et al., 2014). For example, Hood et al. (2014) argued that managers can encourage members to develop and share the “expertise maps that codify the informal domain differ- entiation characterized by TMS.” (2014, p. 11). However, the capacity of these dimensions of leadership to drive TMS likely depends on team characteristics that impact the fit between specific attributes of the approach and the team setting. Specifically, prior research has introduced team size as a critical boundary condition relating to the emergence of TMS (Palazzolo, Serb, She, Su, & Contractor, 2006; Ren, Carley, & Argote, 2006) and the role of trans- formational leadership in generating collaboration (Cha, Kim, Lee, & Bachrach, 2015). While TFL can drive collective focus and collaborative orientation critical to TMS, as physical and psychological distance in- creases with team size, its capacity to do so likely diminishes. Likewise, while TAL may provoke enthusiasm for developing the unique domains https://doi.org/10.1016/j.jbusres.2018.11.029 Received 19 April 2018; Received in revised form 16 November 2018; Accepted 17 November 2018 ⁎ Corresponding author. E-mail addresses: dbachrac@cba.ua.edu (D.G. Bachrach), rmullin@clemson.edu (R. Mullins). Journal of Business Research 96 (2019) 297–308 0148-2963/ Published by Elsevier Inc. T