Effectiveness of leader-member exchange on employee outcomes in cross-cultural environment of China–Pakistan economic corridor

Abstract

PurposeChina–Pakistan Economic Corridor (CPEC) is a framework of regional connectivity in which employees have to work in a cross-cultural environment. This study has extended the leader-member exchange theory by investigating the mediating role of employee commitment (EC) between the relationship of leader-member exchange (LMX) and employee's work-related behaviors.Design/methodology/approachPLS-SEM technique was used to test the model by utilizing a multi-wave/two-source data collected from employees and their supervisors (n = 500) working in different energy projects of CPEC.FindingsAccording to the results/findings, LMX has a significant positive impact on employee commitment, employee performance (EP) and open-minded discussions, but insignificant impact on innovative work behaviour (IWB). Mediating role of employee commitment was significant between the relationship of LMX with EP and open-minded discussions, but insignificant with the IWB.Originality/valueThe study contributes empirical evidence to understanding the leader-member exchange relationship among Chinese managers and Pakistani workers. It also contributes to the LMX theory literature by investigating the effect of LMX on followers' outcomes (employee performance, IWB, open-minded discussions) through employee commitment.