On the whole, transactional leadership plays a significant role in promoting organizational learning, which supports the views of Bass (1997) and Vera and Manor (2004). Furthermore, contingent reward of transactional leadership has a greater effect than management-by-exception on organizational learning, especially explorative learning.
The contingent reward leadership has a significant effect on organizational learning as well as all its dimensions. This indicates that although the performance orientation of learning and result-based orientation belongs to two different management philosophies, if leaders can give rewards flexibly according to work and management results, the organizational learning capability of companies can be improved so as to realize the unity of performance and learning.
The management-by-exception leadership has a significant promoting effect on organizational learning and some of its dimensions. This can be explained by two main reasons. First, as long as leaders, whether actively or passively, conduct timely summaries and feedback on problems in management, pass on the company’s idea and values and implement the company’s regulations and rules, there can be opportunities for organizational learning. Second, the manage- ment-by-exception leadership does not have a significant effect on explorative learning, indicating that it cannot facilitate innovative learning of the company or systematically stimulate knowledge innovation.
In terms of effect, the contingent reward leadership has a greater effect in promoting organizational learning than management-by-exception. This converges with the results of Jansen et al. (2007) for three mam reasons. First, from the nature of leadership behaviors, active rewards are more effective in promoting organizational learning than negative monitoring or even criticism. Active and flexible reward serves as positive guidance and encouragement for learning, while monitoring and even criticism is a negative behavior. Second, in the internal mechanism, the positive emotions and cognitive process triggered by contingent reward can mobilize the intrinsic learning enthusiasm of each member in organizational learning, while the negative emotions and passive changes caused by manage- ment-by-exception only lead to passive external changes. Third, in the internal philosophy orientation, contingent reward follows the learning-oriented management philosophy to a certain extent and attaches importance to continuously guiding and stimulating the learning motivation of all subjects in the process of management and learning, so as to achieve improvement and adjustment in all aspects. In contrast, management-by-exception is oriented to short-term results, which is performance orientation. In this process, leaders force the subjects of the organization to change the original working mode or results through a monitoring mechanism or even a criticism mechanism afterwards. It is a leadership behavior oriented to a short-term result, which has a less significant effect on organizational learning.
The results of this study offer practical implications in three aspects. First, corporate leaders can promote organizational learning through flexible contingent reward and even result feedback. Second, leaders should try to restrain from simple monitoring or criticism of leadership behavior to promote organizational learning, because this type of management-by-exception leadership has a much weaker effect in facilitating organizational leadership. Thirdly, management-by-exception leadership fails to promote the explorative learning of an organization, and what’s needed more by explorative learning is the flexible contingent reward leadership.