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Cynicism About Organizational Change: The Mediating Role of Justice Transformational Leadership, Cohesion Perceptions, and Employee
Cynicism About Organizational Change: The Mediating Role of Justice Transformational Leadership, Cohesion Perceptions, and Employee
Cynicism About Organizational Change: The Mediating Role of Justice Transformational Leadership, Cohesion Perceptions, and Employee
Behavioral Science
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SAGE Journals Online and HighWire Press platforms):
http://jab.sagepub.com/cgi/content/refs/43/3/327
Cindy Wu
Mitchell J. Neubert
Baylor University
Xiang Yi
Western Illinois University
THE JOURNAL OF APPLIED BEHAVIORAL SCIENCE, Vol. 43 No. 3, September 2007 327-351
DOI: 10.1177/0021886307302097
2007 NTL Institute
327
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September 2007
M
assive economic reform and the restructuring of Chinese firms have positioned
China as a significant global power in the marketplace (Z.-M. Wang, 2003). Yet,
China remains one of the least studied regions by management scholars (Tsui,
Schoonhoven, Meyer, Lau, & Milkovich, 2004). This scarcity in Chinese studies,
particularly on organizational change in a Chinese context, raises the question of
whether research findings on organizational change based on Western theories are
generalizable to China because employees in emerging markets may hold different
values from those in developed countries (Kiggundu, 1989).
The Chinese culture is described as highly collective oriented, performance oriented,
and institutional oriented (Hofstede, 1980; Javidan, Dorfman, de Luque, & House,
2006; Triandis, 1995). The ambitious project GLOBE (Javidan et al., 2006) suggests
that the Chinese culture values the cultivating and nurturing of personal relationships
because of the Confucius influence that emphasizes relationships and community. The
performance-oriented aspect of the Chinese culture also portrays an effective leader as
one who can develop an exciting vision for employees (Javidan et al., 2006). Theories
originated in Western cultures that are similar or related to this conceptualization of
effective management and leadership practices in China are transformational leadership
(TFL; Bass, 1997), employees subjective perceptions of cohesion in the group or work
unit (Bollen & Hoyle, 1990), and the leader-referent, social aspects of perceived organizational justice (including informational and interpersonal justice; Colquitt, 2001;
Greenberg, 1993). This study theorizes and then examines the mediating and moderating relationships among transformational leadership, informational justice, interpersonal justice, group cohesion perceptions, and their influences on employees cynical
attitude toward organizational change in a Chinese organization that is undergoing
major administrative change, including abolishment of lifetime employment, implementation of a new performance evaluation system, and introduction of continuous
improvement programs.
Cynicism is characterized as frustration, disillusionment, and negative feelings
toward and distrust of a person, ideology, social convention, or institution (Andersson
& Bateman, 1997), varying in its specificity from cynicism as a general personality
trait to cynicism about business, business leaders, occupation, organization, and organizational change (Wanous, Reichers, & Austin, 2004). It has particularly important
implications in organizational change because the success of organizational change
We wish to thank the editor and three anonymous reviewers for their helpful comments and suggestions.
An earlier version of this article was presented at the Academy of Management meetings in Honolulu, HI,
August 2005. This project was supported by the Faculty Travel Assistance Grant from Baylor University.
Cindy Wu is an assistant professor in the Department of Management at Baylor University. Her current
research focuses on leadership, organizational justice, and service management.
Mitchell J. Neubert is Chavanne Chair of Christian Ethics in Business and the H.R. Gibson Chair in
Management Development at Baylor University. His teaching and research focus is to equip principled
leaders to effectively lead individuals, teams, and organizational change.
Xiang Yi is an assistant professor in the Department of Management at Western Illinois University. Her
research interests include leadership, cross-cultural studies, creativity, and workfamily issues.
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September 2007
The second goal of this study therefore is to test whether employees informational
and interpersonal justice perceptions mediate the transformational leadership influence on employee cynical attitude about organizational change in a Chinese setting.
The context of this study, a Chinese company undergoing major administrative
change, plays a crucial role that raises another important research question: Does
TFL influence employee CAOC in this particular context as the theories rooted in
the Western cultures predict? Disagreement has existed among scholars of TFL on
whether the effect of TFL, a leadership theory originated in the Western culture, is
transferable cross-culturally (Bass, 1997; Pillai, Scandura, & Williams, 1999).
Following previous studies (Jung & Avolio, 1999; Spreitzer, Perttula, & Xin, 2005;
Walumbwa & Lawler, 2003), we adopt a uniform functional universality perspective
(Bass, 1997), which refers to the generalizability of a relationship between two variables cross-culturally but to varying degrees, arguing that the effect of TFL would
be more pronounced in collectivist societies such as China (Jung & Avolio, 1999;
Walumbwa & Lawler, 2003) because of its cultural emphasis on aligning individual
interests and values to those of the group or organization (Shamir, House, & Arthur,
1993). Although people from collectivist cultures tend to value the needs and wants
of the in-group more than those of individuals (Hofstede, 1980), the degree to which
they see the group as in-group is determined by their own subjective evaluation
(Triandis, 1995). Along this line, we take a step further to test whether an individuals perception of group cohesion, perception about group closeness, similarities,
bonding, and his or her personal motivations to remain in the group (Carron &
Brawley, 2000), further enhances the influence of TFL. Our third goal therefore is to
examine whether individual employees group cohesion perceptions moderate and
further enhance the impact of TFL on employee CAOC.
In sum, the current study seeks to contribute to the literature by examining the influence of TFL on employees cynical attitude in organizational change in a Chinese context. First, we test whether supervisors TFL helps reduce employee CAOC. Next, we
test whether employee informational and interpersonal justice perceptions mediate the
influence of TFL on employee CAOC. Third, we examine whether employees perceptions about group cohesion moderate this relationship.
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September 2007
procedures that are implemented and the outcomes that are distributed. Interpersonal
justice characterizes the degree to which employees are treated with respect, dignity,
and sensitivity by the authority figure they interact with (Greenberg, 1993). Being
the principal agents of the organization through which information flows (Cole et al.,
2006), immediate supervisors are management representatives who impact justice
perceptions through their interpersonal behavior (Cohen-Charash & Spector, 2001).
Therefore, immediate supervisors leadership style is most likely to influence
employees CAOC through informational and interpersonal justice perceptions.
Particularly, supervisors TFL style is likely to influence employee CAOC by elevating informational and interpersonal justice perceptions.
The definition of TFL also suggests that informational and interpersonal justice perceptions mediate the influence of TFL on CAOC. Specifically, leaders who demonstrate individualized consideration seek to understand each followers concerns about
organizational change and therefore are able to address them effectively by listening
attentively, coaching, and mentoring based on individual employees needs, abilities,
and aspirations (Bass, 1997). As a result, followers are less likely to blame the change
agent for being unconcerned and incompetent because they are provided with relevant
information (i.e., informational justice) in a supportive manner (i.e., interpersonal justice). Similarly, leaders who use inspirational motivation are able to concurrently communicate information and promote individual worth. Such leaders deliver information
about organizational change through their personal enthusiasm and a clear vision. This
personal approach depicts a vivid picture of the future that is to be achieved collectively and prevents followers from wavering in organizational change because it provides information as to what needs to be done and why (Bass, 1997). Therefore,
employees are more likely to feel esteemed and informed and, as a result, less likely
to be pessimistic or cynical about the organizational change.
Likewise, idealized influence and intellectual stimulation are likely to reduce
employee CAOC because of enhanced informational and interpersonal justice.
Sincere optimism exhibited by leaders own conduct in embodying vision-consistent
principles and values instills in followers the pride and confidence to envision themselves in the new vision (Bass, Avolio, Jung, & Berson, 2003). Because leaders are
the makers of the meaning in an organization (Brockner & Higgins, 2001), leaders
who demonstrate idealized influence provide information about organizational
change by effectively translating the change into approved behaviors that would lead
to positive results. This role modeling and the process of instilling pride in employees are likely to enhance informational and interpersonal justice. Similarly, leaders
who practice intellectual stimulation encourage followers to express creative ideas
by questioning old assumptions, traditions, and beliefs. The freedom to experiment
and possibly fail conveys that employees and their ideas are valued. Furthermore, it
also allows employees to remain cognitively flexible and therefore be more open to
new ideas (Deci & Ryan, 1980). Thus, employees are more likely to feel valued and
understand the rationale behind the change when faced with uncertainty and challenge caused by organizational change. Consequently, they are less likely to be pessimistic about the likely success of the change initiative as a result of just treatment
by their supervisors.
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Moreover, the aforementioned discussion also suggests that perceptions of informational and interpersonal justice could be the mechanisms by which the overall
moderated effect of TFL on CAOC is produced. Specifically, TFL, because of its
collective focus, would yield a greater magnitude of employee attitudinal and behavioral results when employees work unit is perceived as congruent with this collective approach of leadership. That is, transformational leaders are likely to be
perceived as providing employees with relevant information in the change process
because of their ability to articulate a clear collective vision and the rationale behind
it and because of them serving as a role model to show employees the appropriate
behavior in the midst of inevitable uncertainties in the change process. This effect of
TFL is further enhanced by a work unit that is close-knit because it provides a facilitating context for the collective-oriented TFL.
Furthermore, the social information processing perspective of motivation suggests that individuals develop their attitudes and behaviors based on the available
social information that is salient and consistent (OReilly & Caldwell, 1985;
Salancik & Pfeffer, 1978). One such source of social information is the immediate
social context (e.g., networks of coworkers) one is in. The context may influence
ones interpretation of the situation by making certain aspects of the situation salient
and by exposing individuals to the expressed attitudes of others. Because group
cohesion depicts group closeness, similarity, bonding, and individuals desire and
motivation to maintain their membership in the group (Carron & Brawley, 2000),
individuals in cohesive groups tend to comply with the salient attitudes and expectations in the social context. As such, researchers contend that group cohesion facilitates information consistency in the environment (OReilley & Caldwell, 1985). In
a similar vein, we argue that the effect of informational justice perceptions on CAOC
335
would be enhanced through the affirmation from unit members who share similar
and consistent opinions (i.e., high group cohesion). We propose:
Hypothesis 5: Informational justice mediates the moderated relationship between TFL, group cohesion perceptions, and employee CAOC such that the higher the group cohesion perceptions, (a)
the stronger the influence of TFL on informational justice and (b) the stronger the influence of
informational justice on CAOC.
Likewise, we also expect that interpersonal justice mediates the moderating effect
of cohesion perceptions. Specifically, transformational leaders, because of their personal and individualized coaching style of leadership, tend to be perceived as treating employees with respect and dignity, thereby elevating interpersonal justice
perceptions. Meanwhile, because of the collective vision depicted by transformational leaders, a context perceived as being cohesive provides congruency with the
collective-oriented TFL and therefore would magnify the TFL influence on interpersonal justice. In addition, the heightened interpersonal justice perceptions,
through the affirmation of members in a close-knit unit, would further increase in its
magnitude of influence on employee CAOC based on the social information processing perspective. Therefore, we propose:
Hypothesis 6: Interpersonal justice mediates the moderated relationship between TFL, group cohesion
perceptions, and employee CAOC such that the higher the group cohesion perceptions, (a) the
stronger the influence of TFL on interpersonal justice and (b) the stronger the influence of interpersonal justice on CAOC.
METHOD
Research Setting, Sample, and Procedures
The setting for this research was a large Chinese petroleum company undergoing
major administrative organizational change. The changes included abolishing lifetime employment, implementing a new performance evaluation system, and introducing continuous improvement programs through quality circles and regular
meetings and forums. Data were collected through survey administration a year after
the changes began. This time frame ensured that employees had ample time to form
their opinions about change as well as to experience the influence of their supervisors in the midst of the change.
In phone interviews with the general manager prior to the survey administration,
we were able to establish that these were the first substantial change initiatives
within the organization, and therefore employees cynical attitudes about organizational change were not likely to be influenced by their previous experience with
changes in the company. Furthermore, the norm of stability in our state-owned focal
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September 2007
Informational
Justice
Perceptions (IFJ)
Transformational
Leadership
(TFL)
Cohesion
Perceptions
Cynicism about
Organizational
Change (CAOC)
Interpersonal
Justice
Perceptions (IPJ)
337
people who are responsible for solving problems around here dont have the skills
that are needed to do their jobs. The coefficient alpha was .86.
Transformational leadership. We employed the Multifactor Leadership Questionnaire
(MLQ) Form 5X-Short (Bass & Avolio, 1995) to measure TFL. Each dimension of
TFL was measured with four items on a 5-point scale ranging from 1 (strongly disagree) to 5 (strongly agree). Sample items include My supervisor talks optimistically about the future and My supervisor gets me to look at problems from many
different angles. In the instructions, we asked the participants to evaluate their
immediate supervisor based on their interactions on issues relevant to the organizational change. Similar to prior research, the dimensions of TFL showed strong correlations (rs = .43 to .69). Because prior research indicated that dimensions failed to
show discriminant validity (Bycio, Hackett, & Allen, 1995) and because we did not
specify hypotheses on dimensions of TFL, we averaged the 20 items to form a single index of TFL. This practice is also consistent with prior research on TFL using
the MLQ as the instrument (e.g., Bass et al., 2003; Bono & Judge, 2003; Dvir et al.,
2002). The coefficient alpha was .89.
Group cohesion perceptions. We measured employee perceived cohesion by the
three-item measure developed by Podsakoff and MacKenzie (1994). Participants
responded to the items on a 5-point scale ranging from 1 (strongly disagree) to 5
(strongly agree). A sample item is The members of my work group stand up for
each other. The coefficient alpha was .75.
Informational and interpersonal justice. We used Colquitts (2001) five-item
measure to assess informational justice and his four-item measure to assess interpersonal justice. Participants responded to a 5-point scale ranging from 1 (not at all)
to 5 (completely). They were asked in the instructions to evaluate their interactions
with their immediate supervisor on the matters relevant to the organizational change.
A sample item for informational justice is Has he/she communicated details in a
timely manner? A sample item for interpersonal justice is Has he/she treated you
with respect? Coefficients alpha for informational justice and interpersonal justice
measures were .84 and .85, respectively.
Control variables. We controlled for respondents sex, age, education, organizational tenure, and managerial tenure to ensure that the influence of leadership is
above and beyond relevant demographic variables. We included these demographic
variables because of their potential relevance to the independent and dependent variables as suggested by previous research and the top management of the company.
Particularly, because of lifetime employment, the extremely low turnover rate until
the organizational change took place, and the tradition of promotion from within,
employee age, education, organizational tenure, and managerial tenure all helped
capture the level of status an employee enjoyed, which was difficult to measure yet
potentially critical in influencing employees perceptions of not only organizational
change but justice and group cohesion. Sex was also included as a control based on
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338
September 2007
the top managements suggestion that because the majority of the managerial staff
in this company was men, female respondents were likely to have different perspectives of organizational change relative to their male counterparts. Including these
control variables would help us partition out the variance attributable to the alternative explanations.
Remedies and Assessment of Common Method Biases
Because all of our measures were taken from the employees, we took several procedural remedies related to questionnaire design to minimize common method
biases following the suggestions by Podsakoff, MacKenzie, Lee, and Podsakoff
(2003). First, we reordered the items in the questionnaire so that the dependent variable followed rather than preceded the independent variables. This tactic reduces the
effects of consistency artifacts (Podsakoff & Organ, 1986). Second, to minimize the
possibility that social desirability serves as the common factor in explaining variances, we ensured anonymity in a statement in the informed consent that urged
respondents to answer as honestly as possible. Third, all the question items in the
survey were adopted from well-validated measures that have been tested and refined
to include items that measure a construct with a clearly defined domain; therefore,
very little room was left for subjective interpretations that allow consistency artifacts
to govern the responses to questions.
In addition, we conducted a Harmans single-factor test (Podsakoff et al., 2003;
Podsakoff & Organ, 1986) to examine whether one single factor emerged to account
for the majority of the variances in the variables. The result indicated that eight factors with eigenvalues greater than one were extracted, accounting for 61% of the
variance in total. The first component accounted for 30% of the total variance, indicating that the single factor did not account for the majority of the variance.
Furthermore, we conducted a confirmatory factor analysis (CFA) with all variables
combined as one factor. The poor model fit with the data (2/df = 18.22; goodnessof-fit index [GFI] = .78; comparative fit index [CFI] = .77; root mean square error of
approximation [RMSEA] = .18) suggested that although obtained from a single
source, the study variables are unlikely to be dominated by one unobserved common
variance factor. Therefore, we concluded that common method bias was not a major
concern in the current study.
RESULTS
Following the methods employed by H. Wang, Law, Hackett, Wang, and Chen
(2005), we first conducted three tests to verify the distinctiveness of TFL and the two
hypothesized mediating variables, informational justice and interpersonal justice.
First, we conducted a dimension-level CFA including TFL, informational justice,
interpersonal justice, cohesion perceptions, and CAOC in the model. We used four
dimensions of TFL as the indicators and randomly averaged the informational justice, interpersonal justice, cohesion perceptions, and CAOC items to create two
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339
indicators for each construct (H. Wang et al., 2005). Second, we adopted Cohen and
Cohens (1983) test of correlations from a single sample to verify whether there is
significant difference in the correlations between the independent variable (CAOC)
and each of the variables under study. Unequal correlations would suggest discriminant validity. Finally, in hierarchical regression, we entered TFL and observed the
change in R2 after entering informational justice and interpersonal justice.
Significant change in R2 would also imply that these two justice perceptions
explained additional variance in CAOC above and beyond TFL.
Table 1 shows the CFA results. As indicated, the baseline five-factor model fit the
data adequately (2 = 232.24; df = 55; GFI = .94; CFI = .95; RMSEA = .07). We also
tested alternative models, combining informational justice with TFL (Model 1),
interpersonal justice with TFL (Model 2), two justice perceptions with TFL (Model
3), and all five factors (Model 4), against the baseline five-factor model. Significant
2 tests showed that all of the alternative models fit the data significantly worse
than the five-factor model, providing evidence for distinctiveness of TFL, informational justice, interpersonal justice, cohesion perceptions, and CAOC.
The results of Cohen and Cohens (1983) t test of differences between two
Pearson correlations from the same sample also suggest discriminant validity
between transformational justice and justice perceptions. The correlation between
CAOC and TFL is significantly different from both those between CAOC and informational justice (t = 2.26, df = 464, p < .05) and between CAOC and interpersonal
justice (t = 2.49, df = 464, p < .01). Finally, the significant R2 change in the regression equation when informational justice was entered (F = 36.39, p < .01) and
when interpersonal justice was entered (F = 51.97, p < .01) after controlling for
TFL also indicated that informational justice and interpersonal justice perceptions
explained variance in CAOC above and beyond TFL. This and the results from the
other two tests suggest that TFL, informational justice, and interpersonal justice are
distinct constructs.
Table 2 displays means, standard deviations, and correlations among all variables. CAOC is significantly and negatively related to TFL, informational justice,
interpersonal justice, and cohesion perceptions. TFL is positively and significantly related to interpersonal justice and informational justice and cohesion
perceptions.
To test the proposed moderation hypothesis, we conducted hierarchical regression
analyses. Following Aiken and Wests (1991) suggestions, we centered variables that
are the components of the interaction term in the moderation analysis. Table 3 summarizes the results of regression analysis for testing Hypothesis 1, which states that
supervisors TFL is negatively related to followers CAOC, and Hypothesis 4, which
states that employees perceptions about group cohesion moderate the TFL influences on employee CAOC. At Steps 1 through 4, we entered the control variables,
TFL, cohesion perceptions, and the interaction between TFL and cohesion perceptions. Table 2 indicates that the R2 associated with TFL was statistically significant
(in Step 2), lending support to Hypothesis 1. The R2 change was also significant with
the addition of the interaction term, indicating the presence of significant interaction
between TFL and cohesion perceptions. Figure 2 illustrates that the pattern of the
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340
Model 4
Model 3
Model 2
Model 1
Baseline model
Model
Factors
TABLE 1
999.42
633.20
529.27
412.79
232.24
65
62
59
59
55
df
767.18**
400.96**
297.03**
180.55**
.78
.83
.87
.89
.94
Goodness-ofFit Index
.74
.84
.87
.90
.95
Comparative
Fit Index
.16
.13
.12
.10
.07
341
1.32
35.73
11.10
15.60
2.38
3.63
3.87
3.35
3.68
2.90
M
0.47
5.28
2.52
4.68
5.12
0.49
0.68
0.71
0.71
0.67
SD
.05
.08
.03
.08
.03
.07
.06
.12*
.05
1. Sexa
2. Age
3. Education
4. Organizational tenure
5. Managerial tenure
6. Transformational leadership
7. Cohesion perceptions
8. Informational justice
9. Interpersonal justice
10. Cynicism about organizational change
Variable
TABLE 2
.21**
.60**
.36**
.03
.01
.02
.05
.03
.32**
.18**
.03
.05
.01
.03
.01
.16**
.10*
.01
.14**
.06
.05
.09*
.08
.11**
.06
.01
(.89)
.37**
.65**
.54**
.33**
(.75)
.33**
.31**
.17**
(.84)
.61**
.41**
(.85)
.43**
(.86)
10
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September 2007
TABLE 3
Independent Variable
Step 1: Controls
Sex
Age
Education
Organizational tenure
Managerial tenure
Step 2: Transformational leadership
Step 3: Cohesion perceptions
Step 4: Transformational Leadership Cohesion Perceptions
.01
.12**
.12**
.15**
R2
.01
F
0.58
.11**
.00
.02**
62.95**
0.12
11.69**
.05
.04
.02
.01
.05
.37**
.05
.16**
3.5
3
CAOC
2.5
High Cohesion
Perceptions
2
1.5
Low Cohesion
Perceptions
1
0.5
0
Low
High
TFL
FIGURE 2: Interaction Between Transformational Leadership (TFL) and Cohesion Perceptions
on Cynicism About Organizational Change (CAOC)
NOTE: We used one standard deviation above and below the mean to represent high and low levels of
transformational leadership.
343
TABLE 4
Independent Variables
Controls
Sex
Age
Education
Organizational tenure
Managerial tenure
Transformational leadership (TFL)
Moderator: Cohesion perceptions
TFL Cohesion Perceptions
Mediators
IFJ
IPJ
IFJ Cohesion Perceptions
IPJ Cohesion Perceptions
F
R2
Adjusted R2
df
Model 1: Cynicism
About Organizational
Change (CAOC)
.05
.04
.02
.01
.05
.37**
.05
.16**
9.93**
.15
.13
460
Model 2a:
Informational
Justice (IFJ)
.03
.11*
.00
.15**
.08*
.59**
.12**
.01
47.46**
.45
.44
460
Model 2b:
Interpersonal
Justice (IPJ)
.09*
.13*
.06
.05
.05
.45**
.09*
.12**
26.87**
.32
.30
460
Model 3:
CAOC
.01
.10
.00
.03
.08
.11*
.03
.05
.20**
.33**
.07
.17**
16.10**
.30
.28
458
to Muller et al. (2005), mediated moderation can only be established if first of all the
overall moderating effect (between TFL and cohesion perceptions) is significant on the
dependent variable (CAOC). Then, either or both of the following two conditions need
to be met: (a) The effect of the overall interaction (between TFL and cohesion perceptions) on the mediators (informational justice and interpersonal justice) should be
nonzero and the partial effects of the mediators (informational justice and interpersonal
justice) on the dependent variable (CAOC) should also be nonzero, and/or (b) the
effects of the independent variable (TFL) on the mediators (informational justice and
interpersonal justice) are nonzero and the interactional effects between the moderator
(cohesion perceptions) and mediators (informational justice and interpersonal justice)
on CAOC are also nonzero. Lastly, the moderation of the residual effect of the independent variables (the interaction between TFL and cohesion perceptions on CAOC
when the mediators and the interactions between the mediators and moderator are
included in the equation) on CAOC should disappear or be reduced in magnitude compared to the overall effect of moderation. We summarized the statistical results for testing mediated moderation in Table 4.
Table 4 shows the hierarchical regression results for Hypotheses 2 through 6
regarding the mediating roles of informational and interpersonal justice. In Model 1,
we regressed employee CAOC on control variables, TFL, group cohesion perceptions, and the interaction between TFL and group cohesion perceptions. Both TFL
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September 2007
and the interaction term contributed significantly to CAOC. In Models 2a and 2b, the
hypothesized mediators, informational justice and interpersonal justice, were
regressed on the control variables, TFL, group cohesion perceptions, and the overall
interaction term (between TFL and cohesion perceptions). Because we hypothesized
that both informational and interpersonal justices would be the mediators, a multivariate regression analysis was first conducted for the omnibus test, with the same
independent variables included in Model 1. The omnibus multivariate regression
analysis showed that the independent variables overall contributed to informational
and interpersonal justice (Wilkss = .50, F = 24.09, df = 16, p < .01). Therefore,
we proceeded to conduct two univariate regression analyses on informational and
interpersonal justice, respectively, to identify whether TFL and the interaction term
were significant. As Models 2a and 2b indicate, TFL contributed significantly to
both informational justice and interpersonal justice above and beyond the control
variables. The interaction term however was significantly related to only interpersonal justice but not informational justice. In Model 3, we regressed CAOC on control variables, TFL, cohesion perceptions, the interaction between TFL and cohesion
perceptions, two hypothesized mediators (informational justice and interpersonal
justice), the interaction between informational justice and cohesion perceptions, and
the interaction between interpersonal justice and cohesion perceptions.
The results indicate that both TFL and the interaction between TFL and cohesion
perceptions contributed to CAOC significantly and negatively (Model 1), which fulfilled the first condition. The interactional effect between TFL and cohesion perceptions was significant on interpersonal justice but not informational justice (Models
2a and 2b), but both interpersonal and informational justice were significant when
regressed on CAOC (Model 3). Therefore, Condition a in Step 2 is fulfilled for interpersonal justice but not informational justice. Furthermore, the effects of TFL on
informational justice and interpersonal justice were significant (Model 2), and the
interaction between cohesion perceptions and interpersonal justice was significant
on CAOC, whereas the interaction between cohesion perceptions and informational
justice was not significant (Model 3). As a result, Condition 2b for mediated moderation was also fulfilled for interpersonal justice but not informational justice. Finally,
the moderating effect of cohesion perceptions on TFL was reduced from .16 (p <
.01, Model 1) to .05 (ns, Model 3), which fulfilled the last condition for mediated
moderation. These findings suggest that the overall moderating effect of cohesion
perceptions on the TFLCAOC relationship was fully mediated by interpersonal justice but not informational justice. Hypothesis 6 was therefore supported, whereas we
found no evidence supporting Hypothesis 5.
Although informational justice did not mediate the moderation, TFL was significant when predicting informational justice and interpersonal justice (Models 2a and
2b), and the effect of TFL on CAOC was reduced from .37 (p < .01 in Model 1) to
.11 (p < .05 in Model 3) when both mediators (interpersonal and informational justice) were included in the model. These findings indicate that informational justice
and interpersonal justice partially mediated the effect of transformational leadership
on CAOC, lending support to Hypotheses 2 and 3. The results of the hypotheses testing are presented in Figure 3.
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345
Informational
Justice
Perceptions (IFJ)
Transformational
Leadership
(TFL)
Cohesion
Perceptions
Cynicism about
Organizational
Change (CAOC)
Interpersonal
Justice
Perceptions (IPJ)
DISCUSSION
Despite the extensive research on transformational leadership, an immediate
supervisors transformational leadership rarely has been examined in the context of
organizational change in spite of the suggestion that supervisory effectiveness is an
antecedent to employees attitudes about change (Wanous et al., 2000). We are also
not aware of studies examining supervisors transformational leadership influences
in organizational change in a Chinese context, an area that is in need of more
research attention (Tsui et al., 2004). The current study addressed this research gap
by investigating the impact of supervisors transformational leadership on employee
cynicism about organizational change in a large Chinese organization. In this context, transformational leadership was negatively related to CAOC. Furthermore, our
findings indicate that this relationship was mediated by employees informational
and interpersonal justice perceptions and enhanced when employees perceived their
work group as cohesive. In addition, the overall moderating effect of cohesion perceptions on the TFLCAOC relationship was fully mediated by interpersonal justice.
A significant contribution of this study is that it uncovers the followers psychological processes by which transformational leadership yields its influence on
employee CAOC. Wanous et al. (2000) identified a number of leadership characteristics that may reduce employee CAOC. Expanding their initial results, our findings
indicate that interpersonal and informational justice perceptions mediate the
TFLCAOC relationship. Although organizational justice researchers have tested
the impact of employee justice perceptions on the quality of leadermember
exchange (e.g., Rupp & Cropanzano, 2002), to our knowledge, the current study is
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346
September 2007
the first one to test agent-referent justice perceptions (i.e., interpersonal and informational justice; Colquitt, 2001) as the mediating mechanisms of leadership.
Another contribution of our research is theorizing an interactional approach by
identifying whether employee perceptions of group cohesion enhance the effectiveness
of transformational leadership. This advances research in another area of transformational leadership that is in need of investigation (Avolio & Bass, 1988). Because transformational leadership is collective oriented, its effectiveness is enhanced in a
collective context. Recent cross-cultural findings that transformational leadership has
a more pronounced influence on employee attitudes in collectivistic cultures than individualistic cultures are consistent with this context-congruency argument (Walumbwa
& Lawler, 2003). In the literature of leadership substitutes (Howell, Dorfman, & Kerr,
1986), factors that boost the leadership effectiveness are identified as leadership
enhancers. Because cohesion perceptions did not contribute to CAOC as a main effect,
it did not meet the necessary conditions for a leadership substitutehaving a positive
and direct relationship with the dependent variable (Howell et al., 1986). Rather, our
results indicate that group cohesion perceptions serve as a leadership enhancer when
it is high and a leadership neutralizer when it is low.
Furthermore, no other studies have tested supervisors transformational leadership
on followers cynical attitude toward organizational change in a Chinese setting.
Therefore, the current study also adds to the literature by confirming the generalizability of transformational leadership to a nonWestern setting, where studies on
transformational leadership and organizational change have been understudied.
Limitations
Although the use of a Chinese sample provided support for the generalizability and
robustness of transformational leadership across cultures, the characteristics of the
Chinese culture may also limit the generalizability of the current findings to the Western
societies. As a collective-oriented leadership style, the impact of transformational
leadership on employee CAOC and other attitudes toward change may be more pronounced in collectivistic societies (e.g., China) than individualistic societies (e.g., the
United States). This may explain previous research that found a nonsignificant relationship between transformational leadership and employee commitment to an organizational change program in a U.S. organization (Neubert & Cady, 2001). In addition,
because of the collectivist orientation in our study context that would potentially yield
a higher average level of group cohesion, future research is needed to replicate the current findings in a Western organization.
Furthermore, the organization we studied went through a specific type of organizational change, administrative organizational change, which tends to encounter
even greater resistance relative to technical change in emerging economies such as
China (Zhou et al., 2006). This may somewhat limit the generalizability of our findings to other types of organizational change. As China is going through various
forms of massive enterprise reform, we encourage future research to replicate and
expand our current model and findings to other types of organizational change.
Another possible limitation of our study is that all the measures were collected from
employees, making our data vulnerable to common method biases (Podsakoff et al.,
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347
This research suggests several practical implications for those who manage
change, particularly administrative change, where the new organizational structure
and/or administrative processes would yield a greater departure from existing organizational routines. It appears from our research that the power of transformational
leadership lays in its personal focus (Bass, 1985). Immediate supervisors impact justice perceptions through their interpersonal behavior (Cohen-Charash & Spector,
2001). Although transformational leadership has a dispositional component (Judge
& Bono, 2000), it also can be developed (Dvir et al., 2002; Kelloway, Barling, &
Hellur, 2000). As such, it is critical that plans for change include training supervisors in interpersonal communication skills. Training supervisors to demonstrate
transformational leadership behaviors will help effectively manage organizational
change by reducing employees cynical attitudes toward organizational change.
Our research also suggests that the context (as perceived by employees) in which
transformational leadership is enacted impacts its degree of influence. A perceived
cohesive or group-oriented environment, particularly in a Chinese context, enhances
the influence of transformational leaders in reducing cynicism. In other words, for
transformational leadership to have its greatest impact, supervisors should not only
be trained in leadership skills but also in skills for building a cohesive group.
Moreover, followers must be afforded the time, opportunity, and resources necessary
to engage in group activity that facilitates cohesion.
Finally, the booming economic development and globalization that is fostering changes in Chinese organizations, particularly in state-owned organizations
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September 2007
(Z.-M. Wang, 2000) such as the one surveyed in this study, accentuates the importance of understanding change management in China. Developing management
competencies to respond to these changes is of great practical interest (Z.-M. Wang,
2003). Despite the doubts of transferability of Western management theories to
developing economies (Erez, 1994), our research provides initial evidence that
developing transformational leadership is an effective way to manage organizational
change in Chinese organizations. In fact, the collective orientation of Chinese firms
may even enhance the impact of transformational leadership. Although there is much
more to be learned about Chinese employees responses to change, this research confirms that transformational leadership is critical, possibly even more so in China than
in Western contexts, to managing employees cynicism about change.
Across the world, organizations are undergoing change in response to a competitive global business environment. Despite the assertions that transformational
leadership is critical to implementing successful change, there is paucity of theoretically grounded empirical field studies examining transformational leadership in the
context of organizational change. This research advances knowledge for managing
change by finding that transformational leadership influences employee cynicism
about organizational change and by identifying mediating and moderating mechanisms that influence its impact.
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