Interplay between P-O fit, transformational leadership and organizational social capital

Abstract

PurposeUsing 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/approachField study data were used to test the hypotheses. In total, 336 employees from eight different service sector organizations in Pakistan participated in this study. Hierarchical linear modeling was used to analyze the data.FindingsIn 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/implicationsCross-sectional data were collected through self-reports, which raises concerns of reporting bias.Practical implicationsManagers can benefit from the study by focusing on TL as a vehicle for not only achieving change, but also for creating an environment that facilitates better P-O fit and enhanced OSC.Social implicationsThis 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/valuePrevious 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.