Does Globalization Matter : The Change of Power Distance and Its Effects on Authoritarian Leadership in Chinese Organiz

1. Does Globalization Matter : The Change of Power Distance and Its Effects on Authoritarian Leadership in Chinese Organizations Li-Fang Chou Bor-Shiuan Cheng Kaohsiung Medical University National Taiwan University Globalization and Development in Chinese Economic Region Conference, June 22, 2006 in Taipei, R. O. C

2. Presentation Outline • Introduction • Research Purposes • Theoretical Review • Research framework • 2 Studies (Results and Summary) • Discussion

3. Introduction • Globalization and Leadership • Paternalistic Leadership (PL) • Combines strong discipline and authority with fatherly benevolence and moral integrity couched in a personalistic atmosphere (Farh & Cheng, 2000) • Authoritarian Leadership (AL) of PL • Leader take rigorous control over subordinates and demands complete obedience .

4. Introduction • Leadership and authoritarian values under Globalization • The transformation of AL • The Change of power distance values regarding authority • The effectiveness of transformational AL and the key role of power distance within the relationship between transformational AL and individual outcome

5. Study Purpose • To probe into the influencing factors that will affect the difference of employees’ power distance. • To realize the effects of different power distance values upon transformationalauthoritarian leadership. • To better understand the effectiveness of authoritarian leadership across individuals holding difference power distance

6. Relative theories and Previous Studies • The impact of Globalization on Organizational Behavior--leadership • Transcendence / compression of space and economic, technology and information circulation • Cultural aspect, globalization → values homogeneous or heterogeneous all over the world /nation /organization ? Globalization →Culture values → Leadership

7. Relative theories and Previous Studies • What happen to Authoritarian Leadership in Chinese under Globalization ? Will be disappeared ? or transformed ? • According to the content of AL, Farh & Cheng (2000) suggested that • AL behavior hurts subordinates dignity— should and will be lessened. • AL behavior about performance, principle, and core values –should and will be retained or reinforced.

8. People-related AL - Emphasizing leader’s personal authority - Control over Subordinate - Focus on subordinate’s compliance and fear toward leader. - Unwilling to delegate, ignore sub. suggestion, information manipulation… Task-related AL - Emphasizing high performance standards, norms and core values which were built by leader or organization - Control over task or job process and detail - Focus on subordinate’s performance and work attitude. - Didactic behavior, monitor work process, high- goal setting… Relative theories and Previous Studies • The Transformation of Authoritarian Leadership(Jen, Farh, Cheng, & Chou,2003; Cheng & Chou,2005).

9. Relative theories and Previous Studies • What will happen with the Transformation of AL? • Do people – and task – related AL co-existed ? • Convergence Hypothesis (Myer, 1975; Yang, 1988) • The Challenge of Convergence hypothesis • Cultural theory (Beck，1998) • Traditionality and Modernity (Huang, 1995; Yang, 1996) • The relationships of people - and task – related AL with subordinate effectiveness • Work motivation or incentive, emotional feeling… • People-related AL → effectiveness(-) • Task-related AL → effectiveness(+)

10. Relative theories and Previous Studies • PD which the values regarding submission to authority have been gradually altered as the social modernization and industrial/ commercial development. • Organizational Centralization (Janssens & Brett, 1994) → PD (+) • Power distance theory (Mulder, 1977; Poppe, 2003)： leader’s PD > subordinate’s PD; Male PD > Female PD • The emphases on egalitarian (Farh & Cheng, 2000) ： Age (+), Education (-)

11. Relative theories and Previous Studies • The demonstrations of AL behaviors • Trait theory ; Organizational characteristic (Yukl, 2003) • Subordinate’s expectation and preference regarding leadership ( Hofstede, 1980; Dorfman, et. al, 1997) • Organizational Centralization Leader’s PD Leaders’ AL (+) Subordinate’s PD

12. Relative theories and Previous Studies • Power Distance (PD) and AL • PD refers to people’s ideas about the what is acceptable in superior-subordinate relationship (Lee, Pillutla, & Law, 2000); Accept authority’s decision uncritically (Begley, Lee, Fang & Li, 2002) • PD shapes subordinates’ reactions to the supervisors’ leadership / decision / treatment (Farh, Liang, & Hackett, 2006) The effect of AL on individual outcome will be moderated by PD

13. Research Framework Organization char. Hierarchical position and personal char. Study 1 Power Distance Study 2 AL -People –related -Task - related Subordinate Effectiveness

14. Study 1 • Subject • 92 work team from business organization and 125 battalions from military organizations (both are Taiwan sample) • Business sample • 92 leaders and 629 team members (one leaders with 3-13 members) from 60 organizations • Military sample • 125 Battalion commanders (leaders), 402 company commanders (members) and 1121 platoon leader (members). One leaders with 12 members • Measures • Variables: Subjects’ gender , age, education, leader position and type of organization (business / military organization) • PD, People-related AL, and Task – related AL

15. Organization chart. Hierarchical position and personal chart. Study 1 Power Distance AL -People –related -Task - related

16. Study 1 :Draft Results  Factors for PD difference 

17. Study 1 :Draft Results • HLM –Factors for demonstration of AL

18. Study 2 :Draft Results • The effects of subordinate’s PD and organization type on people-related AL

19. Study 2 :Draft Results • The effects of subordinate’s PD and leader’s PD on task-related AL

20. Study 1 Summary • Values regarding submission to authority--PD has been gradually changed as the social change. • Age → PD(+) on age 50+ group • Education (years) → PD (-) • PD in Military org. > PD in Business org. • The demonstration of AL • Main effects for people-related AL • Military Org → People-AL (+); • Leader PD , Subordinate PD → People-AL (+); • Cross-level interaction on AL • Subordinate PD * organization type on People- AL • Subordinate PD * Leader PD on Task -AL

21. Study 1 Complement for Org. type

22. Study 2 • Subject • 5~10 employee ( who cowork with CEO more than one year) each business • Mainland China sample • 375 employees from 53 China private businesses • 61% were males ;15% had college or higher education; average seniority was about 4.57 years, 53% were supervisors • Taiwan sample • 181 employees from 27 Taiwan private businesses • 51% were female; 24% had college or higher education; average seniority was is about 7.60 years ; 53% were supervisors • Measures • Outcome variables: Affective Org. commitment (α=.88, .95), Affective loyalty to CEO (α=.86, .92), and Obligated Loyalty to CEO (α=.80, 88)., • Control variables: employees’ gender, age, education, position, seniority

23. Study 2 • Measures –EFA of AL • Cheng, Farh, & Chou(2005) • People-related AL, 10 items, α=.87 (China) and .89(Taiwan) • He will not reveal any message to me. • He will not let me aware of his real intension. • He will make all company decisions on his own. • He asks me to fully comply with his leadership. • He will devaluate my contributions in work. • The final decision in meeting will be made based on his attitude. • He will underestimate my capability….

24. Study 2 • Task-related AL, 7 items, α=.77 (China) and .84(Taiwan) • He asks more work requirements on me than that I ask for myself. • He requests that his subordinates should achieve higher performance than the ones from other companies. • He asks me to report to him whenever there’s any work progress change. • He will seriously request my explanation once work goal is not achieved. • He will take control on my work. • His management style is extremely strict. • He fully know well of the my work details.

25. Study 2 • Measures-- EFA of Power Distance • Power distance: Dorfman and Howell(1988), 5 items, α=.79 (China) and .80(Taiwan) • Managers should seldom ask for the opinions of employees. • Managers should make most decisions without consulting subordinates. • Managers should avoid off-the-job social contacts with employees. • Managers should not delegate important tasks to employees. • It is frequently necessary for a manager to use authority and power when dealing with subordinates.

26. Power Distance Study 2 AL -People –related -Task - related Subordinate Effectiveness

27. Study 2 :Draft Results  Correlations of all Variables  4. 4. Top-right triangle matrix is correlations for Taiwan sample , and Bottem-left triangle matrix is correlations matrix for China sample.

28. Study 2 :Draft Results  Hierarchical regression analysis –main and moderating effects 

29. Study 2 :Draft Results  Hierarchical regression analysis – moderating effects Affective Loyalty to supervisor Taiwan Sample

30. Study 2 :Draft Results  Hierarchical regression analysis – moderating effects

31. Study 2 Summary • Authoritarian Leadership • Correlation between People- related and Task-related AL (+) • People- related AL → Outcome (-) • Task-related AL → Outcome (+) • Themoderating effects of PD • Only for People- related AL • There are different pattern between Taiwan (- )(as predict) and Mainland China sample (+)

32. Discussion-Preliminary Finding • The impact o f Globalization on Chinese Leadership • Authoritarian Leadership transformed into two type– focus on People and Task • Globalization → organization design, social development → employees’ power distance (values regarding leaders’ authority) • Organizational type, PD of leader and sub. → the demonstration of AL • The effectiveness of AL and the moderated role of PD on outcome

33. Discussion • Further Direction • Longitudinal approach • Individual level of globalization indictor • individual subjective perception v.s. objective job characteristic • impact on OB such as loyalty, the relationship between employee and organization, organizational identity, identification, the conflict/balance between work and family life…

34. Thank you for being patient with this presentation And Expect for getting insight from your inspiration and idea sharing.