How does Authentic Leadership Influence Employee-Organization Relationship? The Mediating Role of Symmetrical Internal Communication

How does Authentic Leadership Influence Employee-Organization Relationship? The Mediating Role of Symmetrical Internal Communication Hoang Thi Kim Quy Vietnam Aviation Academy, Vietnam Tran Mai Dong Nguyen Phong Nguyen University of Economics Ho Chi Minh City, Vietnam Abstract This current study examines the impacts of authentic leadership on symmetrical internal communication and employee-organization relationships in the context of the aviation industry in Vietnam The proposed model and hypotheses were tested using against survey data from 175 employees working in aviation organizations in Ho Chi Minh City The structural equation modeling (SEM) results indicated that authentic leadership positively affects EORs both directly and indirectly, through symmetrical internal communication This means symmetrical internal communication acts as a device connecting authentic leadership to enhanced employee-organization relationships Also, the study provides theoretical and practical implications as well as suggested directions for future research Keywords: Authentic leadership, symmetrical internal communication, employee-organization relationships Research background Internal communication is always a vital process by which employees share information, targets, relationships, make meaning, establish organizational culture as well as an organizational value (Berger, 2008) Internal communication is considered as a fundamental factor of modern organizations Numerous scholars have suggested that effective internal communication plays a critical role in developing positive follower attitudes such as trust, organization's commitment (Jo and Shim, 2005), job satisfaction (Gray and Laidlaw, 2004), identification with an organization (Smidts et al., 2001) and positive employees-organization relationships These attitudes and behaviors, in turn, increase productivity, improve performance, build greater relationships with other stakeholders Recognizing the importance of employees in achieving organization's successes, researchers have conducted broadly studies exploring the drivers of internal communication effectiveness Grunig et al., (2002) suggested that a participative organizational culture, an organic structure, gender equality and power symmetry are the key factors that facilitate the organization’s internal communication However, in recent years, researchers have noticed about the influences of leadership on internal communication Leader’s communication styles are one of the main contextual factors in the internal communication system in the organization (Whitworth, 2011; Men, 2014), affect follower attitudes and behaviors (Berger, 2008; Kim and 794 Rhee, 2011; Men and Stacks, 2013, 2014) Furthermore, leaders enable context and determine the degree in which internal communication takes place Yukl (2006) defined leadership as the process of influencing followers Leadership at different organizational levels directly or indirectly determines structural forms, organizational culture and climate, power distribution, and communication Different types of leadership advocate different communication styles to influence followers, and thus constitute a major component of the internal communication system (Whitworth, 2011) Also, leader’s communication competence, management styles, leader’s communication behaviors is closely connected to employee outcomes, the quality of employee-organization relationships Most previous studies investigated the relationships between internal communication and general leadership style Similarly, a noticeable role of specific leadership style in that relationship has not yet to be proved broadly in various contexts in research, involving authentic leadership which embraces considerable effects on the internal communication system in an organization (Men and Stacks, 2014) According to George et al., (2007), authentic leaders demonstrate a passion for their purpose, lead with their hearts as well as their heads and their values are practiced consistently Previous scholars suggested that authentic leaders establish long-term, meaningful relationships and have the self-discipline to get results They know who they are and become true to themselves Thus, they proactively foster positive environments where their employees can easily conduct two-way communication, including feedback about their managers, whether it is good or not Further, leaders with authentic leadership openly sharing information and expressions of one’s true thoughts and feelings while trying to minimize displays of inappropriate emotions (Kernis, 2003) These leaders not hesitate to disclose information related to making decisions or any issues happening within the organization which employees have right to know and respond Besides that, authentic leaders recognize that leadership is not about their success or about getting loyal subordinates to follow them (George et al., 2007) Thanks to their character, authentic leaders are noted to foster the long-term relationship with their subordinates Moreover, they act in harmony with their words as well as deep personal values and convictions to build credibility and win the respect and trust of followers (Walumbwa et al., 2008) These things make a significant contribution to employee engagement and improve the quality of employee-organization relationships Although, authentic leadership generates numerous positive outcomes, most studies are conducted in western countries which charactered by individualism value, low-power distance (Gardner et al., 2011) Recently, few empirical studies have directly examined the effects of internal communication with employees-organization relationships (Kim, 2007; Kim and Rhee, 2011; Shen, 2011; Waters et al., 2013; Men, 2014; Men and Stacks, 2014;) In contrast, recent researchers have tested the linkages between internal communication and organization performance (Dozier, 1990; Grunig et al., 2002; Yates, 2006; Meng and Berger, 2012; Michaelson and Stacks, 2017) as well as the influences of leadership styles, particularly authentic leadership and top manager’s communication forms of effective internal communication, employee engagement, positive employee-organization relationships (Men and Stacks, 2014; Men 2015; Kang, 2017) Leadership styles, excellent communication have significantly proved to nurture better relationship between employees and their organization (Kress, 2005; Lockswood, 2007; Men and Stacks, 2014; Kang, 2017) The studies on the relationship amongst leadership styles, internal communication, the quality of employee-organization relationships have limitations in Vietnam’s current business context Furthermore, Vietnamese enterprises’ perceptions of these strategic problems have been misunderstood (Vu, 2013) They have not determined the importance of effective internal communication operation in enhancing company performance in the future, specifically, top manager’s roles in applying leadership and management perspectives to work on and increase employee commitment through effective internal communication system in the organization (Vu, 2013) Thus, this study develops an LCR (leadership-communication-relation) framework that explains how authentic leadership affects employee-organization relationships in the context of the aviation industry in Vietnam This study also tests the direct effect of authentic leadership style on employee-organization 795 relationships, and the mediating role of symmetrical internal communication on the relationship between authentic leadership and employee-organization relationships in the context of the aviation industry in Vietnam The findings provide significant implications for communication professionals and organizational leaders on how to develop the best practices of internal communication and positive employee attitudes and behavior that contribute to organizational effectiveness in a transition market Theoretical background and hypothesis development 2.1 Authentic leadership and symmetrical internal communication Authentic leaders are generally highly aware of their values and are more likely to act in accordance with them Through their consistent actions, they become a role model for their followers Based upon their openness and truthfulness, an openly sharing environment is created in their organization In this respect, Walumbwa et al., (2008) and Walumbwa et al., (2010) argued that authenticity is often accompanied by open communication, disclosure, and the expressions of one’s true and genuine thoughts and feelings Likewise, authentic leaders recognized that, once they are true to their self, their followers, in turn, an accurate flow of information will come to them Then, the importance of two-way internal communication is always embraced in organizations in which authentic leaders lead With the aim of maintaining sustainable relationships with subordinates, authentic leaders truly care about the employees’ well-being Notably, they highly emphasize the symmetrical notion of non-manipulations of followers (Walumbwa et al., 2010) Also, in the AL construct suggested by Walumbwa et al., (2008), one of the core dimensions of AL is balanced processing of information which refers to key responsibilities of authentic leadership in processing information to make decisions In other words, leaders with authentic leadership not hesitate to reckon with any issues, even these matters bring negative impacts for them Interestingly, authentic leaders willing to support an open and fair working environment with transparent information for their employees (Men and Stacks, 2014) Particularly, to the extent possible, authentic leaders disclose work related information in a transparent and open fashion, as long as doing so does not violate the privacy or safety of others Additionally, when undesirable situations occur and full disclosure would be inappropriate, such leaders release as much information as possible, while communicating the reasons for not withholding certain facts As a result, followers catch up with the reasons behind a leader’s decision, which limits the fear of the unknown and fosters feelings of trust (Garner et al., 2011) Similarly, due to their highly self-awareness and internalized moral perspective, authentic leaders open to feedback, whether it is good or not about themselves Thus, authentic leadership communication is characterized by openness, consistency, transparency, truthfulness, and accountability (Men and Stack, 2014) Moreover, Men (2014) reports a positive correlation between authentic leadership and symmetrical internal communication The study also demonstrated the role of leadership communication with followers in internal communication setting Also, when employees are supervised by authentic leaders, they are more likely to perceive the organization’s communication as symmetrical Based on the discussion, this study hypothesizes that: H1: Authentic leadership has a positive effect on a symmetrical communication 2.2 Authentic leadership and employee-organization relationships Authentic leadership has been linked to diverse antecedents and outcomes, both theoretically and empirically (Gardner et al., 2011) Many researchers provided evidence that authentic leadership can be great for any organization or team Overall, the Gardner et al (2011) review proposes that authentic leadership is connected to the positive leader (psychological well-being), positive follower’s behaviors and attitude such as empowerment, job outcomes, job satisfaction, organizational citizenship behaviors, employee engagement, 796 trust in leadership, motivation, innovation to work and organizational outcomes (openness of organizational climate and firm financial performance) Scholars also present the negative relationship between Al and undesirable outcomes as follower burnout (Gardner et al., 2011) Together, these results provide evidence of predictive validity of the authentic leadership construct Authentic leadership gets more attention due to increasing changes of business environment and crisis periods People believe that authenticity is crucial element that leaders need to have in order to lead their organization successfully in a dynamic environment as today Therefore, there is a variety of research, noting a positive linkage between AL and various outcomes such as perceived leader effectiveness, follower extra effort, satisfaction with the leader (Moriano et al., 2011; Neider and Schriesheim, 2011), follower basic need satisfaction, follower organizational commitment (Neider and Schriesheim, 2011), follower affective commitment (Leroy et al., 2012) Likewise, Gardner et al., (2011) also carried out an extensive review of authentic leadership literature, studies on authentic leadership from 2003 to 2010 These authors provide that existing publications that focus on authentic leadership, including theoretical, empirical, and practitioner studies The literature has presented a wide range of positive authentic leadership outcomes, including positive attitude and behaviors Walumbwa et al., (2008) and Wong and Cummings (2009) found that authentic leadership contribute to employee job performance and trust Also, authentic leaders link to identify with the leaders, organizational citizenship behavior, employee engagement (Walumbwa et al., 2010) A study of Jensen and Luthans (2006) reveals that authentic leaders have positive impacts on employee work happiness and organizational commitment Authentic leaders are identified with consistent actions based on their value What they say, they act is associated with their fundamental and deeply rooted shared values with the organization and high moral standards Thus, authentic leaders increase their follower’s trust and commitment (Berger, 2008) Similarly, Men (2011) suggested that employees’ favorable identification of the organization and employee engagement is cultivated by the perceived credibility of an organization’s senior leadership Next, when the organization’s leadership is considered as trustworthy and credible, employees tend to engage the organization more Identical notions may also be applied to the employee’s immediate leaders Additionally, authentic leaders easily to become a role model for their subordinates because they never ignore their follower’s perspectives and utilize such inputs in making decisions They openly share information fairly and transparently with employees and are oriented toward building a quality relationship with them A positive environment, including higher levels of disclosure, transparency, two-way communication, and relationship orientation characterized by authentic leadership, establishes a context where employees feel trusted and empowered Based on these certain contributions, employee trust, control mutuality, satisfaction, and commitment to the organization are boosted Therefore, H2: Authentic leadership has a positive effect on employee-organization relationships 2.3 Symmetrical communication and employee-organization relationships Previous studies have provided a variety of evidence that indicates the effectiveness of symmetrical internal communication in fostering employee- organization relationships Kim and Rhee (2011) argued that symmetrical internal communication and EORs are antecedents influencing on communication behaviors of the leaders The study also reports a significant positive correlation between symmetrical internal communication and employee-organization relationships In the line with this, Vu (2013) investigated the effects of four-dimensional internal communication construct on employee engagement with a sample of employees working in Ho Chi Minh large companies The author notes that effective internal communication enhances employee engagement and makes a significant contribution for company’s development In addition, Men (2014); Men and Stacks (2014) and Kang (2017) also suggested that symmetrical internal communication has a strong connection to employee-organization relationships Furthermore, Grunig et al., 797 (2002) noted that excellent employee communications could ultimately nurture quality employee relationships and supportive employee behaviors toward the organizations Besides that, with its definition as “trust, credibility, openness… reciprocity, network symmetry, horizontal communication, feedback… negotiation’’ (Grunig, 1992, p 558; cited in Kim and Rhee, 2011, p 252) This demonstrates the impacts of symmetrical communication efforts on the quality of employee-organization relationships Based on the above-mentioned discussion, this study, therefore hypothesizes that: H3: Symmetrical internal communication has a positive effect on employee – organization relationships The proposed research model is shown in Figure Figure The proposed model Research methods 3.1 Measurement scale The measures of key constructs in this study were adapted from previous literature (Grunig and Huang, 2000; Neider and Schriesheim, 2011; Kang, 2017) Authentic leadership (ALI) was assessed using the 14-item scale of Neider and Schriesheim (2011), which comprises four dimensions: Self-awareness, relational transparency, internalized moral, and balanced processing Symmetrical internal communication (SIC) scale with five items, was adapted from Kang 2017 and Dozier et al., (1997) with some modifications based on reviewing literature as well as capturing Vietnamese context Employee-organization relationships (EORs) were accessed along the dimensions of trust, satisfaction, commitment, control mutuality in Grunig and Huang (2000)’s 12 item-scale The final English questionnaire was translated into Vietnamese and then back translated into English to ensure instrument equivalence following the procedure suggested by Brislin (1970) Because the research was conducted in Vietnam with Vietnamese respondents Therefore, the Vietnamese selfadministrated quantitative survey was printed and sent to 200 respondents with convenience sampling to collect research data Next, respondents self-completed a survey with all items were measured by five-point Likert scale, including “totally disagree” (= 1), “disagree” (= 2), “neutral” (= 3), “agree” (= 4), “totally agree” (=5) The hard copies of the questionnaire were delivered to respondents Then, based on the valid questionnaire from respondents, SPSS and AMOS24.0 were used to test the measurement and structural models 3.2 Sampling and demographics The model and hypotheses were examined using data set collected from respondents who are employees in aviation organizations in Ho Chi Minh City These companies directly and indirectly operate and provide a wide range of services and products for the aviation industry in Vietnam such as flight operations, ground 798 services, maintenance services, duty-free products, air cargo, air traffic controlling These organizations were selected because they belong to the aviation sector, which is one of specific fields of Vietnam and attracts a large number of employees According to Tyler (2016), the aviation industry has a growing importance to Vietnamese economy Beside, internal communication with these companies plays an integral role as this function decides the degree in which employees enable activities related to their duties in a flexible and consistent way Moreover, the Vietnam aviation industry characterized by highly fierce and competitive intensity with many competitors inside as well as outside Asia, particularly high-quality labor pressure (Tyler, 2016) Thus, the interaction between the leaders and their followers in these organizations through a symmetrical internal communication setting helps to ensure a long-term relationship The convenience sampling approach to self-administrated questionnaires was conducted to collect data The researcher delivered questionnaires to 200 participants and after a period of time, total 183 questionnaires were collected However, questionnaires were eliminated because they were invalid (the questionnaires had the missing values or the respondents gave the answers not integrity) Hence, 175 questionnaires were valid for the current research, counting for a response rate of 87.5% In comparison with the minimum sample size, this figure was satisfactory Demographic characteristics of 175 respondents were illustrated in Table According to the results, the percentage of the respondents in two genders were slightly different (56 % for females and 44% for male) In terms of age, more than a half respondents were under 30 and a very small rate of participants was over 40 The table also showed that the majority of respondents has a Bachelor’s degree (72%) In addition, the respondents who just have finished vocational education count for the lowest percentage (2.9%) Likewise, the result demonstrated that more than a third of respondent has working experiences of to 10 years In contrast, only 1.1% of respondents have been working for their organization over years Table Demographic profile (n = 175) Demographic profile Gender Age Education background Working experiences Category Frequency Percent Female 98 56.0 Male 77 44.0 Total 175 100.0 40 1.7 Total 175 100.0 High school 18 10.3 Vocational school 2.9 Bachelor’s degree 126 72.0 Master’s degree 26 14.9 Total 175 100.0 =10 36 20.6 5.00 1.1 Total 175 100.0 799 Data analysis and hypothesis testing 4.1 Reliability and validity test The authentic leadership measurement contained four dimensions with 14 items: Self-awareness (ALS, items), rational transparency (ALR, items), Internalized moral perspective (ALI, items), balanced processing (ALB, items) The CFA result was for Authentic leadership showed the quite fit data However, the factor loading of ALI4 was not significant (0.44 0.70) Regarding the convergent validity, the averaged variance extracted (AVE) value of authentic leadership’s sub-components were significant (>0.5) Also, correlations of each pair of sub-components were less than 0.8 in significant at 0.001 Thus, these findings supported reliability, convergent validity, and within-construct discriminant validity for the authentic leadership construct Symmetrical internal communication was measured by four items Based on the CFA result, the model was suitable to the market data, with the all loading factor more than 0.50 Also, the appropriate indices from the measurement model were: CFI = 1.000, TLI = 1.024 and RMSEA= 0.000 that represented a very good fit of the model Moreover, the composite reliability achieved 0.798, AVE was 0.501 Therefore, this measurement had a proper standard for reliability, convergent validity Employee-organization relationships included four dimensions: Trust (ET, items), Satisfaction (ES, items), Commitment (EC, items), Control mutuality (EM, items) The CFA result indicated some information for testing the fit of the data such as: the criteria were proper TLI = 0.951, CFI = 0.967 and RMSEA = 0.072 After examining the reliability of employee-organization relationships, the result showed that Cronbach’α and the composite reliability (CR) values of all sub-components were significant (>0.80) In terms of the convergent validity, the AVE value of employee-organization’s sub-components were acceptable (>0.5) Furthermore, correlations of each pair of sub-components were less than 0.8 in significant at 0.001 Therefore, the reliability, convergent validity, and within-construct discriminant validity of this construct were achieved The saturated model was also analyzed using AMOS24.0 for checking the discriminant validity between all constructs The results showed that TLI = 0.906, CFI = 0.916 and RMSEA = 0.062 were appropriate Therefore, this result presented that the saturated model had relevance with data market Discriminant validity of all scales was also achieved for the correlations between pairs of constructs range from 0.586 to 0.801 which were well under 0.85 According to Kline (2011, p 362), the estimated correlations between factors should not be higher than 0.85 Therefore, discriminant validity of scales was satisfactory 4.2 Hypothesis testing results The theoretical model had been used to test the three causal paths, which was represented in the hypotheses (H1, H2 and H3) The significant parameter estimates results showed that the standardized estimated for three hypotheses were statistically significant and in the hypothesized direction Therefore, these three hypotheses were supported Further details about the hypotheses of the present thesis were discussed in the next section Model estimation yielded a good fit: χ2 =520.208; df = 218; P-value = 000; χ2/df = 1.662; RMSEA=0.062; CFI=0.906; TLI = 0.916 Also, the model indicated that all factor loadings on the latent constructs were significant and substantial (≥0.50) Likewise, the model presented that all of three paths were statistically significant (P