The moderating effect of supervisor–subordinate guanxi on the relationship between transformational leadership and organizational effectiveness

Abstract

This study explores the association between transformational leadership and organizational effectiveness, measured in terms of organizational commitment, job satisfaction, and turnover intentions. The study also explores the moderating role of supervisor–subordinate guanxi (s-s guanxi) on the association between transformational leadership and organizational effectiveness. The proposed hypotheses were tested using PLS path modeling and PROCESS macros in SPSS 22.0. Data were collected at two different times from a sample of 222 industrial firms in China. The findings reveal that transformational leadership has a direct, positive, and significant relationship with organizational effectiveness. Furthermore, s-s guanxi has a positive moderating effect on the association between transformational leadership and organizational commitment and between transformational leadership and job satisfaction. However, the moderating effect of s-s guanxi on the association between transformational leadership and turnover intentions is not significant. These findings unearth several theoretical, empirical, and managerial implications and provide the basis for future research.