Why aren’t we on the same page? The role of supervisors’ transformational leadership and employees’ public service motivation in explaining discrepancy between implemented and perceived people management

Empirical research has indicated that people management is rated higher by supervisors than perceived by employees. This is cause for concern, because this people management discrepancy could lead to less positive attitudinal, cognitive or performance outcomes than intended. Little is known about what causes this discrepancy. In this study, we examine how supervisors’ transformational leadership and employees’ public service motivation influence people management discrepancy in a public sector context. We expect that transformational leadership decreases people management discrepancy due to the attribution of relevant purposes to people management. Based on a person-environment fit logic, we hypothesize that employees’ PSM will decrease the people management discrepancy and that this will strengthen the effect of transformational leadership (an interaction effect). Using multilevel structural equation modelling based on multi-rater survey data of 876 employees and 84 supervisors in schools, the results indicate that PSM has a negative effect on all dimensions of the people management discrepancy. Transformational leadership partly decreases the discrepancy between implemented and perceived supervisory support. There is no evidence for an interaction effect. We conclude that direct effects of employees’ and supervisors’ characteristics should not be overlooked, especially with the strong emphasis on a system approach in HRM research. Also, we suggest that causality is more complex that originally proposed in the value chain model and that a causal loop should be integrated in the value chain model.