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Extending previous research on transformational leadership (TFL), the present study explores the mechanisms that explain the relationship between TFL and team performance. Drawing on the three-stage model of TFL (Conger & Kanungo, 1998), we theorize that TFL predicts high levels of team performance through shaping team goal orientation and group affective tone. To test the hypotheses, we use data collected from managers and members of 61 research and development teams and use the partial least squares analysis to test hypotheses. The results show that TFL positively predicts positive group affective tone through team learning goal orientation but negatively predicts negative group affective tone via team avoiding goal orientation. Finally, we find that positive group affective tone is positively associated with team performance, whereas negative group affective tone is negatively associated with team performance.
