Interplay between P-O fit, transformational leadership and organizational social capital
| DOI | https://doi.org/10.1108/PR-07-2016-0161 |
| Pages | 913-930 |
| Published date | 04 June 2018 |
| Date | 04 June 2018 |
| Author | Usman Raja,Dave Bouckenooghe,Fauzia Syed,Saima Naseer |
| Subject Matter | HR & organizational behaviour,Global HRM |
Interplay between P-O fit,
transformational leadership and
organizational social capital
Usman Raja and Dave Bouckenooghe
Goodman School of Business, Brock University,
St Catharines, Canada, and
Fauzia Syed and Saima Naseer
Faculty of Management Sciences, International Islamic University,
Islamabad, Pakistan
Abstract
Purpose –Using social identity theory, the authors hypothesize that transformational leadership (TL) leads
to better person-organization fit (P-O fit), which in turn contributes to the emergence of organizational social
capital (i.e. OSC). Furthermore, the authors suggest that the relationship between P-O fit and OSC is
contingent upon the level of TL. The paper aims to discuss these issues.
Design/methodology/approach –Fieldstudy data were used to test thehypotheses. In total, 336employees
from eight different service sector organizations in Pakistan participated in this study. Hierarchical linear
modeling was used to analyze the data.
Findings –In support of the hypotheses, the authors found that TL was positively related to both P-O fit and
OSC. Also, P-O fit mediated the TL-OSC relationship. Finally, TL moderated the relationship between P-O fit
and OSC.
Research limitations/implications –Cross-sectional data were collected through self-reports, which
raises concerns of reporting bias.
Practical implications –Managers can benefit f rom the study by focusing on TL as a vehicle for not
only achieving change, bu t also for creating an envi ronment that facilit ates better P-O fit and
enhanced OSC.
Social implications –This study provided a rare opportunity to examine the proposed relationships in a
developing country. This enhances our insight into the efficacy of theories that have been mainly developed
and tested in developed countries.
Originality/value –Previous research hypothesized P-O fit as a mediator between leadership and
performance, yet failed to receive support. The current study is unique by demonstrating that TL, as a
relational leadership style, contributes to building an important resource (OSC) through the mediating effect
of P-O fit.
Keywords Quantitative, Transformational leadership (TL), Organizational social capital,
Person-organization fit (P-O fit)
Paper type Research paper
Introduction
The study of social capital as an organizational phenomenon is receiving growing interest.
Defined as “the character of social relationships within the organization, realized through
members’levels of collective goal orientation and shared trust”(Leana and Van Buren, 1999,
p. 540), organizational social capital (hereafter referred to as OSC) has been a critical
resource that benefits the organization’s access to external resources (Hitt et al., 2002) and
facilitation of internal coordination (Sirmon et al., 2007). In addition, as one of the most
enduring organizational resources, OSC has been pivotal in shaping an organization’s
effectiveness through a reduction of transaction costs, facilitation of information flow, and
knowledge creation (Lin et al., 2001; Nahapiet and Ghoshal, 1998). Since this resource is so
intertwined within the organization, OSC cannot be easily traded in an open market or
exchanged from one social system to another (Nahapiet and Ghoshal, 1998). Although OSC
development and sustenance is a main function of human resource management (HRM)
Personnel Review
Vol. 47 No. 4, 2018
pp. 913-930
© Emerald PublishingLimited
0048-3486
DOI 10.1108/PR-07-2016-0161
Received 14 July 2016
Revised 7 April 2017
12 June 2017
2 September 2017
Accepted 9 September 2017
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/0048-3486.htm
913
P-O fit, TL
and OSC
(Delery and Roumpi, 2017) and research on OSC cannot be separated from the field of HRM
(Nahapiet and Ghoshal, 1998), research in this domain has not received the deserved
attention it should in mainstream HRM literature.
OSC, as core building block of HRM, is generally perceived as a distinctive approach to
managing people that seeks to achieve competitive advantage through the strategic
development of a highly committed and capable workforce (Huselid, 1995; Youndt et al.,
1996). In order to compete in today’s globalized world, organizations have to develop their
human capital to make their HR practices more effective (Delaney and Huselid, 1996).
Consistent with this argument, Youndt et al. (1996) also pointed out that employee’s skill
acquisition and development could be promoted through OSC development, which is a
critical function of HR.
Despite its significance for organizations’survival and growth (i.e. Adler and Kwon,
2002; Coleman, 1988; Phelps et al., 2012), investigating how OSC emerges has remained
relatively uncharted territory (Adler and Kwon, 2002; Bolino et al., 2002; Hodson, 2005).
In response, the efforts of this paper will center on examining how lead ership
(i.e. transformational leadership, hereafter TL) enables the activation of OSC.
Whereas previous research on OSC focused on how organizations design formal
mechanisms and policies that help to foster OSC, this same research has offered limited
insights into how leadership could facilitate OSC (Bolino et al., 2002). In response, several
scholars started to explore how managerial behaviors can influence OSC’s formation
(e.g. Li et al., 2014; Johnson et al., 2013). Drawing from these studies, it is evident that
leadership has a formative influence on OSC, yet these same inquiries have ignored the
underlying mechanisms that explain how leadership helps to establish OSC.
Leadership is one of the key driving forces and a potent source for attaining sustained
competitive advantage (Avolio, 1999) for firms. A central construct in leadership theories
(Chi and Pan, 2012; To et al., 2015) this study will focus on TL. This “relationship-oriented”
leadership style characterized by idealized influence, inspirational motivation, intellectual
stimulation, and individualized consideration (Bass, 1985) positively influences a wide range
of organizationally important outcomes including organizational commitment, individual
performance (Banks et al., 2016; Chi and Pan, 2012; Van Knippenberg and Sitkin, 2013),
creativity, turnover intentions, and extra-role behaviors ( Judge and Piccolo, 2004;
Lowe et al., 1996; To et al., 2015; Tse et al., 2013).
TL has significant implications for HRM, as such leaders create a strategic vision,
transfer that vision by acting on it consistently, and build commitment toward the vision
(Avolio, 1999). Thus, TL is likely to produce increased cohesion, trust, and performance
among employees leading to effective change in work environment. Positive HRM practices
such as staffing, training, performance appraisal, and compensation systems are the means
whereby leaders express their individual consideration of employees. Transformational
leaders listen attentively and pay special attention to followers’needs and growth by acting
as mentors or coaches, thus building OSC in employees and making their followers more
effective human resources for the firms (Zhu et al., 2005).
TheemphasisisonTLasaleadershipstyle because it helps to explain how leaders
might generate the level of stability and closure required to build close and collaborative
internal relationships within the group (Adler and Kwon, 2002; Coleman, 1988) through
their actions. Stability is critical because social capital reflects the accumulation of
goodwill over time. It allows for a level of continuity in social structures, which increases
the clarity and visibility of mutual obligations, as well as the development of trust and
norms of cooperation. Also, when group members share strong norms, it creates a sense of
closure that facilitates a feeling of trust and identity (Coleman, 1988). More specifically, TL
theory posits that transformational leaders can influence followers to go beyond their
immediateself-interestsforthegoodofthegroup/organization, provide a common vision,
914
PR
47,4
To continue reading
Request your trial