The Leader–Member Exchange Theory in the Chinese Context and the Ethical Challenge of Guanxi

Journal of Business Ethics - The leader–member relationship has been identified as a key determinant of successful working relationships and business outcomes in China. A high-quality...     

How is Benevolent Leadership Linked to Employee Creativity? The Mediating Role of Leader–Member Exchange and the Moderating Role of Power Distance Orientation

Previous research has shown that virtuous leader behavior in the form of benevolent leadership has considerable impact on employee creativity. However, little is known as to how and under what conditions these constructs are linked. In the current research, we proposed and tested a moderated mediation model positing leader–member exchange (LMX) as a mediator, and employee power-distance orientation as a moderator of this relationship. Two studies were conducted to test our hypothesized model. In Study 1, repeated measured data collected from 284 Chinese employees in an information technology company demonstrated that benevolent leadership had a lagged effect on LMX. In Study 2, analyses of multisource and lagged data from 391 Chinese employees in 42 research and development teams, and their direct supervisors indicated that benevolent leadership was positively related to supervisor-rated employee creativity via LMX. In addition, the relationship between benevolent leadership and LMX was stronger for employees high in power-distance orientation. Theoretical implications of benevolent leadership’s research and practical contributions concerning promoting creativity in organizations where benevolent leaders prevail are also discussed.     

The Relationship Between Leaders’ Group-Oriented Values and Follower Identification with and Endorsement of Leaders: The Moderating Role of Leaders’ Group Membership

In this article, we hypothesize that leaders who display group-oriented values (i.e., values that focus on the welfare of the group rather than on the self-interest of the leader) will be evaluated more positively by their followers than leaders who do not display group-oriented values. Importantly, we expected these effects to be more pronounced for leaders who are ingroup members (i.e., stemming from the same social group as their followers) than for leaders who are outgroup members (i.e., leaders stemming from a different social group than their followers). We tested our hypotheses in two studies. Results of a field study (N = 95) showed the expected relationship between leaders’ group-oriented values and followers’ identification with their leaders. A scenario study (N = 137) replicated the results and extended it to followers’ endorsement of their leaders. Overall, these findings suggest that displaying group-oriented values pays off more for ingroup than for outgroup leaders.     

Impact of Ethical Leadership and Leader–Member Exchange on Whistle Blowing: The Moderating Impact of the Moral Intensity of the Issue

Given the prevalence of corporate frauds and the significance of whistle blowing as a mechanism to report about the frauds, the present study explores the impact of ethical leadership and leader–member exchange (LMX) on whistle blowing. Additionally, the article also explores the moderating role of the moral intensity [studied as magnitude of consequences (MOC)] of the issue on this relationship. The article reports results of three experimental studies conducted on the postgraduate students of a premier technology institute in India. Ethical leadership, LMX, and moral intensity are manipulated through scenarios. Study one (n = 81) manipulates ethical leadership (ethical/unethical) and quality of LMX (low and high) as independent variables; study two (n = 80) manipulates ethical leadership and moral intensity (high and low MOC), and study three (n = 87) manipulates LMX and MOCs to assess their individual and joint effects on whistle blowing. Results show that not only do ethical leadership and LMX predict whistle blowing, but these relationships get moderated by the moral intensity of the issue as well.     

Leaders’ Core Self-evaluation,Ethical Leadership,and Employees’ Job Performance: The Moderating Role of Employees’ Exchange Ideology

With the increasing demand for ethical standards in the current business environment, ethical leadership has received particular attention. Drawing on self-verification theory and social exchange theory, this study investigated the effect of leaders’ core self-evaluation on the display of ethical leadership and the moderating role of employees’ exchange ideology in the relationship between ethical leadership and employees’ job performance (i.e., task performance and organizational citizenship behavior). Consistent with the hypotheses, the results from a sample of 225 dyads of employees and their immediate leaders showed a positive relationship between leaders’ core self-evaluation and ethical leadership. Moreover, the results showed that ethical leadership mediates the effects of leaders’ core self-evaluation on employees’ job performance. Furthermore, we found that employees’ exchange ideology moderates the relationship between ethical leadership and job performance. The theoretical and practical implications of these findings are discussed.     

The Moderating Effects of Political Skill and Leader–Member Exchange on the Relationship Between Organizational Politics and Affective Commitment

Previous empirical studies have shown that perceptions of organizational politics are negatively related to individuals’ affective commitment. The key contribution of this study was that it found the interactive moderating effects of political skill and quality of leader–member exchange (LMX) on the relationship between perceptions of organizational politics and affective commitment. Our results indicated that politics perception affective commitment relationship was weaker when both political skill and quality of LMX are high. When only political skill is high and the quality of LMX is low, or LMX quality is high but political skill is low, the negative relationship between politics perception and affective commitment was not mitigated. Limitations and implications for future research are discussed.     

The Influence of Generational Diversity Management and Leader–Member Exchange on Innovative Work Behaviors Mediated by Employee Engagement

This study investigates the influence of generational diversity management and the quality of leader–member exchanges on innovative work behaviors, mediated by employee engagement. A group of 1839 employees at Indonesia’s largest telecommunications company, which represents three generations – Baby Boomers, Gen X, and Gen Y – participated in the study. The results suggesting that employee engagement strengthens the influence of quality in leader–member exchanges, and diversity management leads to positive innovative work behaviors. Generational diversity, leader–member exchange, and innovative work behaviors are lowest among Gen Y, but are highest among Gen X. Employee engagement peaks in Baby Boomers.     

Strengthening the Quality–Loyalty Linkage: The Role of Customer Orientation and Interpersonal Relationship

Customer loyalty has been suggested as the most important indicator of a firm's advantageous position relative to competitors. The effect of service quality on customer loyalty has been empirically proven in a variety of industries. For industries such as grocery wholesalers whose offerings seem to be almost homogeneous in the eyes of retail customers, by implication, service quality in itself may be insufficient. Therefore, this study aims to explore how to strengthen the effect of service quality on customer loyalty. In this study, we propose that customer orientation and interpersonal relationship may reinforce the quality–loyalty linkage. The empirical results showed that all three variables independently had significant power in discriminating among three levels of loyalty (high, medium, and low). Customer orientation and interpersonal relationships also functioned as moderators that strengthen the effect of service quality on customer loyalty. Moreover, customer orientation had a greater moderating effect than interpersonal relationship. The research findings could, we believe, assist wholesale managers to allocate their resources more effectively to establish customer loyalty in an era of fierce competition.     

The Interactive Effect of Authentic Leadership and Leader Competency on Followers’ Job Performance: The Mediating Role of Work Engagement

The effect of authentic leadership and leader competency on employee job performance has received growing attention in the past decades; however, few studies have simultaneously integrated these two leadership perspectives. We have thus developed a mediated moderation model to test the interactive effect of authentic leadership and competency on followers’ job performance through work engagement. Based on a sample of 248 subordinate–supervisor pairs, hierarchical regression analyses reveal that (1) authentic leadership positively relates to followers’ task performance and organizational citizenship behavior (OCB); (2) leader competency moderates the relationship between authentic leadership and OCB; (3) and followers’ work engagement mediates the main effect of authentic leadership and the interactive effect of authentic leadership and competency on followers’ task performance and OCB. All the three results are consistent with our hypotheses.     

The Effects of Performance Rating, Leader–Member Exchange, Perceived Utility, and Organizational Justice on Performance Appraisal Satisfaction: Applying a Moral Judgment Perspective

The performance appraisal process is increasingly seen as a key link between employee behaviour and an organization’s strategic objectives. Unfortunately, performance reviews often fail to change how people work, and dissatisfaction with the appraisal process has been associated with general job dissatisfaction, lower organizational commitment, and increased intentions to quit. Recent research has identified a number of factors related to reactions to performance appraisals in general and appraisal satisfaction in particular. Beyond the appraisal outcome itself, researchers have found that appraisal reactions are affected by perceptions of fairness and the relationship between the supervisor and the employee. To explain the relationships among these factors, the present article proposes a moral cognition perspective. We suggest that employees judge a performance appraisal from the perspective of its moral justifiability, and that appraisal reactions will be determined, at least in part, by the perceived moral justifiability of the process. The proposal was supported by results from a survey of government employees using measures of performance ratings, leader–member exchange, perceived utility, and organizational justice.     

Leaders’ Moral Competence and Employee Outcomes: The Effects of Psychological Empowerment and Person–Supervisor Fit

This study examined how leaders’ moral competence is linked to employees’ task performance and organizational citizenship behaviors. Based on a sample of 102 employee–supervisor pairs from seven organizations in South Korea, the results of this study revealed that leaders’ moral competence was positively associated with employees’ task performance and organizational citizenship behaviors toward leaders (OCBS). As expected, employees’ psychological empowerment partially mediated the relationship between leaders’ moral competence and employees’ task performance and OCBS. Furthermore, person–supervisor fit (PS fit) moderated the relationship between leaders’ moral competence and employees’ psychological empowerment such that the relationships became stronger for individuals higher rather than lower in PS fit.     

It’s a Matter of Principle: The Role of Personal Values in Investment Decisions

We investigate the role of personal values in an investment decision in a controlled experimental setting. Participants were asked to choose an investment in a bond issued by a tobacco company or a bond issued by a non-tobacco company that offered an equal or sometimes lower yield. We then surveyed the participants regarding their feelings toward tobacco use to determine whether these values influenced their investment decision. Using factor analysis, we identified investment- and tobacco-related dimensions on which participants’ responses tended to load. Two of these factors, relating to the societal impact of investment decisions and the health effects of tobacco, were highly significant in determining whether participants selected a tobacco or non-tobacco related investment. More importantly, we found that when the rate of return on a tobacco-related investment exceeds the rate of return on an investment not involving tobacco by 1%, the intensity of participant concerns about the societal effects of their investment decisions was especially important in determining investment choices. This finding indicates that traditional wealth-maximization approaches, which do not consider the personal values of the investor, omit an important factor that affects investment decisions.     

The Role of CEO’s Personal Incentives in Driving Corporate Social Responsibility

In this study, we explore the role of Chief Executive Officers’ (CEOs’) incentives, split between monetary (based on both bonus compensation and changes in the value of the CEO’s portfolio of stocks and options) and non-monetary (career concerns, incoming/departing CEOs, and power and entrenchment), in relation to corporate social responsibility (CSR). We base our analysis on a sample of 597 US firms over the period 2005–2009. We find that both monetary and non-monetary incentives have an effect on CSR decisions. Specifically, monetary incentives designed to align the CEO’s and shareholders’ interests have a negative effect on CSR and non-monetary incentives have a positive effect on CSR. The study has important implications for the design of executive remuneration (compensation) plans, as we show that there are many levers that can affect the CEO’s decisions with regard to CSR. Our evidence also confirms the prominent role of the CEO in relation to CSR decisions, while also recognizing the complexity of factors affecting CSR. Finally, we propose a research design that takes into account endogeneity issues arising when examining compensation variables.     

The International Exchange of Men and Machines 1750–1800

The launching of the Dictionary of Business Biography project was first announced in this journal four years ago. ¹ 1. Business History, 21 (1980). This year sees the publication of the first (A-C) volume of a projected six-volume work by Butterworths, the leading reference book publishers, in association with the London School of Economics' Business History Unit. ² 2. David J. Jeremy (ed.), Dictionary of Business Biography. A Biographical Dictionary of Business Leaders Active in Britain in the Period 1980–1980 Volume I, A-C (London: Butterworths, 1984). The other volumes will cover the surnames D-H, I-N, O-S, and T-Z and will be completed by an Index volume. To mark this event we asked the editor of the Dictionary to stand back from his labours on individual entries and give us an overview of the first volume, and its relation to major debates in business history. This offers a preview of the patterns which emerge from this the first comprehensive historical study of business career patterns in Britain.

Editor     

‘The Impact of Personal and Organizational Moral Philosophies on Marketing Exchange Relationships: A Simulation Using the Prisoner’s Dilemma Game’

The purpose of this research is to examine the impact of individual and firm moral philosophies on marketing exchange relationships. Personal moral philosophies range from the extreme forms of true altruists and true egoists, along with three hybrids that represent middle ground (i.e., realistic altruists, tit-for-tats, and realistic egoists). Organizational postures are defined as Ethical Paradigm, Unethical Paradigm, and Neutral Paradigm, which result in changes to personal moral philosophies and company and industry performance. The study context is a simulation of an exchange environment using a variation of the prisoners’ dilemma game. A literature review is provided in the opening section, followed by details on the simulation, discussion of the results, and the implications for theory and practice.     

Not All Followers Socially Learn from Ethical Leaders: The Roles of Followers’ Moral Identity and Leader Identification in the Ethical Leadership Process

Journal of Business Ethics - Recent literature suggests that ethical leadership helps to inhibit followers’ unethical behavior, largely built on the premise that followers view ethical...     

Personal response systems and learning performance: The mediating role of learners’ engagement

The use of personal response systems (PRSs) to support the learning process is increasing. This study examines the impact of PRSs from individual learners’ and instructors’ perspectives on individual learners’ engagement with PRSs and their learning performance. Data were collected from a sample of 236 undergraduate bachelor of business administration students in the School of Business at a Hong Kong university. The results indicated that the learner interface was important to individual learners’ engagement with PRSs and their learning performance. Instructor attitude and technical competence had significant impacts on learning performance. Engagement with PRSs partially mediated the effect of both perspectives on learning performance. Implications for the theory and practice of individual learners’ learning performance are discussed.     

Work–Family Effects of Servant Leadership: The Roles of Emotional Exhaustion and Personal Learning

This study examined how servant leadership influences employees in terms of work-to-family conflict (WFC) and work-to-family positive spillover (WFPS). These effects were explored through a focus on the mediating roles of emotional exhaustion and personal learning. The results, which were based on time-lagged data collection in China, indicated that employee perceptions of servant leadership related negatively to WFC and positively to WFPS. Moreover, reduced emotional exhaustion and enhanced personal learning mediated the relationship between servant leadership and WFPS. Furthermore, reduced emotional exhaustion (but not enhanced personal learning) mediated the relationship between servant leadership and WFC. Our study’s results provide insightful theoretical and managerial implications and offer new directions for research on leadership and work–family relations.     

Product Touch and Consumers’ Online and Offline Buying: The Role of Mental Representation

As offline retailers struggle to compete with online ones, the importance of a consumer’s ability to touch a product prior to purchase becomes important to study. Prior research has found inconsistent results on whether product touch facilitates consumers’ product-related decision making. Some studies report a positive effect, whereas others do not. The current research reconciles this inconsistency and draws retailing implications. Across three experiments, we show that the effect of product touch on consumers’ purchase intentions and willingness to pay for a product being evaluated is evident when consumers’ mental representation of the product is concrete, but not when abstract. We further show that perceived risk and perceived ownership simultaneously mediate this moderating effect of mental representation. Implications are drawn for both offline and online retailers.