Leader-member exchange as a mediator in the relationship between benevolence value and leader effectiveness: An insight into the hotel industry of Bali

Manuscript type: Research paper. Research aim: Some studies indicate that benevolence value directly affects leader effectiveness while others argue for the potential of the leader-member exchange (LMX) as a mediator. Aiming to delineate the mechanism of benevolence value and its influence on leader effectiveness, this paper specifically investigates the mediating role of the LMX on the two elements. Design/ Methodology/ Approach: A survey is conducted on 131 leader-subordinate pairs who are from the hotel industry in Bali. The scales measuring the outcomes are adapted from previous studies and they carry strong reliability scores of between.78 to.95. The regression analysis is then used with the PROCESS to obtain results. Research findings: Results indicate that the relationship between benevolence value and leader effectiveness is fully mediated by the LMX. Theoretical contribution/ Originality: This research contributes to the body of literature by suggesting that: (1) the impact of benevolence value only occurs if subordinates perceive and feel a good relationship with their leaders; and (2) the degree of importance of LMX as a powerful mediator between leaders’ values and positive outcomes depends on its context. Practitioner/ Policy implication: This study highlights the importance of leaders to pay prime attention on their relationship with their subordinates, in order for their subordinates to understand and feel the leaders’ concerns for them and thus become more motivated. This effort is especially important in the service industries, such as the hotel industry, in vertical-collectivistic culture. Research limitation: In addition to the usual restraint of cross section design, the impact of this study is limited by its focus on only a single value (benevolence) from Schwartz et al.’s (2012) ten values.