Leader’s Differential Treatment: A Cross-cultural Review and Suggestions for Future Research

Abstract

The phenomenon that leaders treat subordinates differently is prevalent in both Chinese and western organizations and has attracted the attention from many organizational scholars. However, the conceptualization and related study of this phenomenon in the western academia have been independent of Chinese academia to a great degree, leading to far too few structured confrontations of conceptual frameworks and empirical findings across the two bodies of scholarship. Therefore, this paper provides a comparative review of the construct and effects of leaders’ differential treatment, aiming to benefit the progress of cross-cultural organizational theories and practice. In terms of the construct development, it shows that meanings and operationalization of constructs mainly rooted in western culture are different from those of indigenous Chinese constructs, due to different theoretical and cultural backgrounds. Western constructs, such as leader-member exchange differentiation (LMXD) and differentiated leadership, primarily based on western leader-member exchange theory and leadership theory, tend to describe leaders’ differential treatment within the working scope, while indigenous Chinese constructs, such as differential leadership and leader-member guanxi differentiation (LMGD), develop from Fei Hsiao-Tung’s differential model of association theory (chaxugeju theory) and the indigenous LMG theory, describing leaders’ differential treatment not only within the working scope but also in private lives. In addition, operationalization of western constructs seems more convenient and mature, because mainly based on the existing LMX and leadership scales they use within-group variance” or coefficient of variation” to measure the degree that leaders differentiate among their followers. However, operationalization of many indigenous Chinese constructs is still in the preliminary development stage and directly measures subordinates’ personal perception of leaders’ differential treatment, except for LMGD whose operationalization is similar to western constructs. Based on these Chinese and western constructs, organizational scholars have explored extensively on leaders’ differential treatment effects. By contrast, the studies based on western constructs have gained more theoretical and empirical achievements, especially the LMXD effect research. This comparative review discovers that both streams of scholarship have many inconsistencies in theoretical explanation and empirical results. Specifically, the differential treatment can generate positive work outcomes due to efficient role assignments or upward-mobilization incentives especially for ‘outsiders’. On the contrary, it may also be detrimental to the workgroup, as subordinates would respond negatively to it due to unfairness perceptions or subgroup conflicts. Western scholarship has paid great attention to these inconsistencies, mainly devoting to exploring the boundary conditions or examining whether the positive or negative effects can exist at the same time. Nevertheless, the studies based on Chinese constructs have not yet begun to deal with this issue. What’s more, although both streams of research concern how leaders’ differential treatment influence subordinates’ perception of fairness and subgroup divisions, the theoretical perspectives adopted and hypothetic mechanisms developed are different. Finally, this paper discusses the future development and cross-cultural applicability of leaders’ differential treatment theory. It argues that the redundancy of those western and indigenous Chinese constructs needs to be examined, the inconsistency of empirical findings about its effects needs a further exploration, and its causes also need attention in the future. As for the cross-cultural applicability problem, on the one hand, future research should try to apply indigenous Chinese constructs to the study of western organizations. On the other hand, the role of cultural factors playing in the formation and effect-generating process of leaders’ differential treatment also needs to be further studied.