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Do interpersonal relationships stillmatter for turnover intention? Acomparison of South Korea and ChinaTai Gyu Kim a , Jin Kyu Lee a & Jun Ho Lee ba Business School, Korea University , Seoul , Republic of Koreab Business School, Hoseo University , Asan , Republic of KoreaPublished online: 05 Feb 2013.

To cite this article: Tai Gyu Kim , Jin Kyu Lee & Jun Ho Lee (2013) Do interpersonal relationshipsstill matter for turnover intention? A comparison of South Korea and China, The InternationalJournal of Human Resource Management, 24:5, 966-984, DOI: 10.1080/09585192.2012.743472

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Do interpersonal relationships still matter for turnover intention?A comparison of South Korea and China

Tai Gyu Kima*, Jin Kyu Leea and Jun Ho Leeb

aBusiness School, Korea University, Seoul, Republic of Korea; bBusiness School, Hoseo University,Asan, Republic of Korea

This study investigated the effects of supervisor and co-worker relationships on theturnover intentions of workers in Korea and China. A U-shaped relationship betweensupervisor relationships (i.e. leader–member exchange) and turnover intention reportedin the studies using western samples has not been replicated in the Asian samples of thisstudy. Instead, each of supervisor and co-worker relationship had a negative and linearassociation with turnover intentions in China. On the other hand, co-worker relationshipshad a negative linear relationship with turnover intentions while supervisor relationshipdid not relate to worker’s turnover intention in Korea. The comparison between Koreaand China showed that the supervisor and co-worker relationships had stronger influenceon turnover intentions in China than in Korea. Discussions and implications concerningthe Korean HRM in the global context are offered.

Keywords: co-worker satisfaction; Korean HRM and turnover intention; leadermember exchange

The most important thing in dealing with people in organizations was interpersonalrelationship when I started my career in HR department 25 years ago. For example, when anemployee had a problem with his/her boss, I invited both of them to a dinner along with beer.Mystically, I witnessed all the problems gone in the very next morning between these two.Interpersonal relationship was a magic tool at that time. Interestingly, this is no longer true inthe same organization – relationship per se means professional relationship, but no longerhuman relationship. (An HR director in a large Korean bank in 2011)

Globalization has produced a borderless world and a convergence in human resource

management (HRM) practices (Rowley 1997). Particularly, organizations in the Asia

Pacific adopted best HRM practices from their western counterparts and Asian HRM led to

the convergence toward what is called the ‘Western HRM’ model (Rowley 1997). For

example, Korea has witnessed major changes in HRM practices from lifetime employment

with seniority-based systems to flexible and performance-based systems in the 1990s

(Rowley and Bae 2002). Such transformation of HRM systems in Korea became possible

with the shift in core ideological beliefs from relationship orientation to the market

principle (Rowley and Bae 2002).

However, complete convergence between western and Korean HRM practices is not

practicable because of various cross-cultural differences. Unique cultural attributes place

important constraints on the convergence of HRM practices (Benson and Rowley 2003).

Despite major transitions in core ideology from relationship orientation to market

q 2013 Taylor & Francis

*Corresponding author. Email: kimt@korea.ac.kr

The International Journal of Human Resource Management, 2013

Vol. 24, No. 5, 966–984, http://dx.doi.org/10.1080/09585192.2012.743472

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principle in Korean HRM practices, market principle has not been implemented the same

way as in the western countries. For example, the Korean Labor Standard Act still prevents

non-executive full-time workers from being terminated against their will, except for, some

exceptions. In other words, human resource (HR) practices, including an employment

contract, do not rely solely on market principle in Korea. Similarly, interpersonal

relationship has not fully given way to market principle as a core ideology of HR practices.

The meaning of interpersonal relationship in managing HRs may not be the same across

western and Korean organizations.

The current paper intends to study how the meaning of interpersonal relationship in

Korean organizations with regard to turnover intention differs from what was previously

found based on western organizations. Investigating one of the critical HRM factors

(i.e. turnover intention), the current study aims to present the unique features of Korean

HRM practices. In doing so, we expect to reveal the influence of global context and

environment on Korean HRM.

Turnover is a very costly event to organizations, and has received much attention in the

literature of organizational behavior and HRM. Turnover intention has also received much

attention because it is the most direct predictor of actual turnover and because employees

with high turnover intentions affect other employees and their work performance in a

negative manner (Hom and Griffeth 1991; Harris, Kacmar and Witt 2005). Important

organizational variables including job satisfaction, compensation, leadership and

alternative job opportunities have been studied in relation to turnover and turnover

intentions (Griffeth, Hom and Gaertner 2000).

However, relatively less attention has been paid to the supervisor and co-worker

relationships in the literature on employee turnover. For example, a meta-analysis on

employee turnover (Griffeth et al. 2000) could identify only three studies on employee–

supervisor relationship in comparison to 67 studies on job satisfaction. Moreover,

satisfaction with co-worker relationships has been viewed only as a subset of overall job

satisfaction in the well-known Hom–Griffeth model of employee turnover (Hom and

Griffeth 1991).

Although many scholars agree that an employee’s relationships with supervisors and

co-workers are important predictors of employee turnover, findings on such relationships

vary depending on the context. Earlier meta-analyses reported generally negative

association between the employees’ relationship with supervisors and their actual turnover

(r ¼ 20.23, Griffeth et al. 2000) and turnover intention (r ¼ 20.31, Gerstner and Day

1997). Subsequent studies also reported negative association between supervisor

relationship and turnover intention (e.g. Ansari, Hung and Aafaqi 2007). However,

some studies showed that the quality of employee–supervisor relationship had a non-

linear effect on employee turnover, indicating that employees, both low and high in quality

of supervisory relationship, had higher turnover compared with employees who

demonstrated a more moderate relationship (Harris et al. 2005; Morrow, Suzuki, Crum,

Ruben and Pautsch 2005). Such findings were obtained from the western context, which

values an individualistic and independent orientation rather than a collectivistic and

interdependent orientation (Hofstede 2001). Individualistic people prefer a loosely knit

social framework in which they are expected to take care of themselves, whereas

collectivistic people prefer a tightly knit social framework in which they expect members

of a particular in-group to look after them in exchange for unquestioning loyalty (Hofstede

2001). Collectivist individuals emphasize interpersonal relationships with others by

showing concerns about the effects of their actions or decisions on others, willingness to

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accept the opinions and views of others and involvement in the lives of others (Hui and

Triandis 1986).

In a collectivist nation such as Korea, the quality of interpersonal relationships with

supervisor (and among co-workers) is one of the most important predictors of HR

outcomes (Dorfman et al. 1997). For example, with nepotic tradition, the incumbent

members of the group view their new members as family and guarantee job security for

non-executive employees by the age of 55. This shows that Koreans care for those with

whom they have built a long-term relationship and that Korean organizations place high

emphasis on interpersonal relationships (Chung, Lee and Jung 1997; Bae 1998).

Recognizing the difference between Korean and western HR practices in emphasis on

interpersonal relationship, the current study investigates the influence of interpersonal

relationship factors on employee’s turnover intention in Korean organizations. We focus

on leader–member exchange (i.e. LMX) defined as the quality of the interpersonal

relationship between a supervisor and an individual employee (Graen and Scandura 1987).

We also investigate the influence of individual employee’s satisfaction with other

co-workers on turnover intention.

Additionally, this study compares the relative importance of supervisor and co-worker

relationships on turnover intention between Korea and China. We specifically chose China

for comparison because we expected to offer practically and academically important

findings and implications. First, the sizable number of Korean firms currently operates in

China, and the findings from comparisons between Korea and China are expected to offer

meaningful practical implications for Korean HRM in the global context. As of 2011,

China is the Korea’s largest trading partner with the total volume of import and export

being US$ 399 billion and US$ 104 billion, respectively (Korea International Trade

Association, www.kita.net).

Second, China offers an ideal context for comparison purposes in that both Korea and

China have much in common while showing delicate differences. In both countries,

traditions concerning interpersonal relationship are deeply rooted in Confucianism, dating

back to more than 2500 years. Confucianism emphasizes family as a basis for ideal

government and reciprocity principles in interpersonal relationships. Such shared

traditions have generated highly collectivistic cultures (Hofstede 2001). Consequently,

interpersonal relationship has traditionally played an important role in HR practices and

policies in both Korea and China.

While interpersonal relationships are important in dealing with HRs in both countries,

it might be more or less important in one country than in the other given the recent changes

occurring in both Korea and China. For example, China has traditionally emphasized

interpersonal relationships more than Korea and the aforementioned transition from

relationship orientation to market orientation has not fully occurred in China (Bozionelos

and Wang 2007; Tung, Worm and Fang 2008). On the other hand, some sporadic evidence

suggests that transformation from relationship orientation to market principle in HRM has

been progressing since the late 1990s in Korea (Bae and Lawler 2000; Froese, Pak and

Chong 2008).

Recognizing that interpersonal relationship is still important in dealing with HRs in

both countries, we first discuss and predict overall pattern concerning turnover intention

and interpersonal relationships (both with supervisor and co-workers) in both the

countries. Subsequently, highlighting the divergence between Korea and China, we will

discuss the relative importance of interpersonal relationship in relation to turnover

intention in Korea and China. Practical implications regarding Korean HRM in the global

context will be offered and discussed as well.

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Leader–member exchange and turnover intentions

LMX theory has been frequently used to explain the quality of the relationship between

supervisors and subordinates. Dyadic relationship development based on role theory

(Kahn, Wolfe, Quinn, Snoek and Rosenthal 1964) and social exchange theory (Blau 1964)

forms the basis of the LMX theory. According to the LMX theory, supervisors assign

important roles to subordinates that they like and evaluate as strong performers.

The subordinates selected to fulfill more important roles develop high-quality

relationships with their supervisors through mutual trust and socio-emotional support

(Graen and Scandura 1987).

A line of research suggests a negative and linear relationship between LMX and

turnover. Focusing on a dyadic relationship between supervisor and subordinate, Graen,

Liden and Hoel (1982) argued that the previously found effect of leadership on turnover

was actually the result of subordinate’s immediate and interpersonal relationship with

his/her supervisor, which they viewed as LMX. Subsequent research has also shown that

employees with high LMX characterized by a high level of trust, emotional support and

other related benefits from a supervisor are less likely to intend to quit their job (Vecchio

and Gobdel 1984; Ferris 1985). As a result, a well-accepted view that LMX and turnover

intention have a negative linear relationship has been generated (Gerstner and Day 1997).

However, several studies have questioned the linear relationship between LMX and

turnover intention found in previous studies. Initially, Vecchio (1985) reported a failure to

replicate Graen et al.’s (1982) findings of a negative relationship between LMX and

turnover. He explained that the importance attached to differences in the quality of

supervisor/subordinate relationship might depend on the jobs and hierarchical levels in

organizations (Vecchio 1985). Harris et al. (2005) found a U-shaped relationship between

LMX and turnover intentions, which is not consistent with the previously proposed linear

relationship. They argued that employees high in LMX have higher job mobility because

of receiving numerous benefits and advantages from an incumbent supervisor, such as

access to their supervisors’ social networks and higher performance ratings (Harris et al.

2005). At the same time, employees high in LMX may experience marginal self-

actualization by staying longer with the same employer since they may already have taken

full advantage of the resources and the opportunities offered by a current employer (Harris

et al. 2005). Subsequent research showed similar findings and offered similar explanations

of a U-shaped relationship (Morrow et al. 2005). In sum, scholars began to argue that too

good supervisor relationships can increase an employee’s attractiveness to the external

labor market and, in turn, his/her turnover intention.

However, the rationale and arguments behind the aforementioned findings of the

U-shaped relationship between LMX and turnover intentions in western workers (Harris

et al. 2005; Morrow et al. 2005) do not easily explain turnover intentions and LMX

among Asian workers. First, the importance attached to differences in the quality of

supervisor/subordinate relationship across different jobs and functions in organizations

cannot be underestimated in Asian context (Dorfman et al. 1997). For example, the

relationship with supervisor is so important in Korea that many Koreans prefer

supervisor’s verbal recognition to tangible rewards across different functions and levels,

since it is a clear and visible indication of a quality relationship with their supervisors

(Hayashi 1988). Moreover, in Chinese organizations, supervisors achieve and execute

control based on conformity, nepotism and obligation networks (guanxi) instead of other

formal control channels such as performance-contingent rewards and punishments

(Redding and Wong 1986).

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Second, more resources and advantages that employees with high-quality relationship

with supervisor receive do not warrant higher job mobility in Asian countries. The benefits

and advantages provided by the employer are highly context-specific and are generally

less useful in other organizations. For example, development opportunities in Asian

countries focus more on organization-specific skills development for internal promotion

than on career development in the broader labor market for individual employees

(Choi 2004). Also, in many Asian countries, including Korea and China, a job is defined

by what an employee’s supervisor requires rather than by a formal description of the job

duties due to unclear job descriptions or their absence. Such practices produce employees

equipped with unique skill sets required by their current organization rather than by

broader market and/or industry, which in turn entrenches employees to their incumbent

organization (Mitchell, Holtom, Lee, Syblynski and Erez 2001).

Third, perceived mobility may not increase with LMX in Asian organizations because

of concern about social sanctions for those who leave the organization. Employees

equipped with better skills and knowledge because of high LMX are also viewed as

responsible for higher contributions to the organization that provided such benefits (Blau

1964). Strong social norms exist in Asian organizations, such that employees with high

LMX (i.e. in-group members) are expected to stay with and provide continuous

contributions to the organization in return for obtaining strong socio-emotional and

economic support from the organization (Lee, Tinsley and Chen 2000). In Asian

organizations, where this norm of reciprocity is upheld in the form of continuous

employment, it is less likely for in-group members to leave the employer than in western

organizations.

Lastly, self-actualization through accomplishing career goals, such as reaching a top

executive position, is easier within the same organization than by job-hopping in Asian

countries. Internal promotion is more popular than external recruiting for managerial

functions in Asian organizations (Kye 2008), and seniority in an organization is more

recognized than seniority in a profession (Glinow, Drist and Teagarden 2002). In other

words, additional self-actualization opportunity through career development is usually

greater by staying with a current employer than switching to a new one.

In sum, the arguments that challenge the linear relationship between LMX and

turnover intention seem to be less persuasive in an Asian context. Instead, the relationship

with a supervisor in an Asian context seems still important in terms of predicting many

organizational outcome variables including turnover intention. Based on the above

discussion, we predict a negative linear relationship between LMX and turnover intentions

of Asian workers.

Hypothesis 1: Employees’ LMX will have a negative association with their turnover

intention in Asia

Co-worker satisfaction and turnover intentions

Unlike the mixed findings on LMX and turnover intentions from previous research, extant

research consistently suggests negative associations between satisfaction with co-workers

and turnover intentions across different contexts and conditions (Griffeth et al. 2000;

Golden 2007). Satisfaction with co-workers fulfills an employee’s emotional needs in the

organization (Kahn 1998) and feelings of attachment to others in the organization

(Reinsch 1997). Moreover, an employee who is less satisfied with co-workers tends to find

a workplace less enjoyable (Sherony and Green 2002) and feels less obligated to the

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organization (Burt 2001). In sum, co-worker satisfaction parallels the effect of sufficient

emotional ties with others in the organization and helps prevent an employee from leaving

the organization voluntarily (Mitchell et al. 2001).

We expect the same negative association between co-worker satisfaction and turnover

intentions in Asian organizations. Although little empirical research has investigated co-

worker satisfaction and turnover intentions using Asian samples, there are few reasons to

expect different findings from those obtained using western samples. In collectivistic

cultures, such as Korea and China, interpersonal relationships among workers are

emphasized and as such individual workers view themselves as more embedded in a

network of social connections as compared with their western counterparts (Markus and

Kitayama 1998; Hofstede 2001). In such a cultural environment, satisfaction with co-

worker is just as important predictor of turnover intentions in Asian organizations as in

western settings. Therefore, we hypothesize that co-worker satisfaction will have a

negative association with turnover intentions.

Hypothesis 2: Satisfaction with co-workers will be negatively associated with turnover

intentions in Asia

Comparison between Korea and China

The meaning and importance that supervisor and co-worker relationships convey in

relation to turnover intentions can differ between Korea and China. The two countries are

often viewed as culturally close, each representing a strong long-term orientation and

collectivism based on Confucian roots (Hofstede 2001). However, each country

interpreted and adapted Confucianism in a different way. Accordingly, differences exist in

the meaning and importance of interpersonal relationships in organizational life across the

two nations (Hitt, Lee and Yucel 2002).

Interpersonal relationships govern and guide much of human behavior in Chinese

organizations (Fahr, Tsui, Xin and Cheng 1998). For example, guanxi is defined as the

existence of particularistic ties between an individual and others (Tsui and Fahr 1997;

Jacob 1980), underscoring the strong emphasis on relationships in China. The importance

of guanxi is highlighted particularly by a Chinese individual’s tendency to treat other

people differently based on his/her relationship with them. An empirical study suggests

that guanxi between supervisor and subordinates relates positively to performance ratings,

implying the importance of maintaining a quality relationship with supervisor (i.e. high

LMX) to improve many organizational outcomes, including turnover and promotions

(Fahr et al. 1998). Chinese employees usually understand commitment to their

organization as an act of personal loyalty to their supervisor, which demonstrates the

importance of personal relationships in Chinese organizations (Alston 1989).

The Koreans view interpersonal relationships differently, since individuals in Korea

place a narrower focus on interactions among those that are not equal (Steers, Shin and

Ungson 1989; Hitt et al. 2002). The Korean interpersonal relationship principle is inhwa,

which is comparable to guanxi and stresses harmony between unequals (Alston 1989).

Based on Confucian ideals, inhwa demands that employees offer total loyalty to their

employers and supervisors in an organizational context (Alston 1989). In Korea, inhwa is

used as a tool to control and regulate behaviors and attitudes of subordinates in

organizations (Alston 1989). Under the culture of inhwa, which emphasizes an

authoritarian principle, some employees may view the meaning of relationship as a

liability (i.e. ‘I owe loyalty to my supervisor’) rather than an asset (i.e. ‘I may use my

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supervisor to my advantage’). In contrast, socio-emotional exchange principles govern

interpersonal relationships with guanxi bases in China such that personal favors and

generosity are provided with anticipation that they will be reciprocated in the future

(Hwang 1987). In sum, interpersonal relationships represented by guanxi in China are

critical to help us understand the wide spectrum of employee behaviors, while inhwa in

Korean organizations serves mainly to regulate subordinates’ obedience to figures of

authority. Such a distinction indicates that interpersonal relationships in employee’s

organizational life are more emphasized in Chinese rather than in Korean organizations.

We should also note that the meaning of interpersonal relationships in organizational

life in Korean firms has changed recently, while strong relationship orientation as guanxi

survived recent modernization and the infusion of capitalism in Chinese society (Yang

1988; Bozionelos and Wang 2007; Tung et al. 2008). Korean firms experienced

remarkable changes in their culture from relationship orientation to market orientation

through the financial crisis of the late 1990s and their subsequent responses to a changing

environment (Froese et al. 2008). Seniority-based performance appraisal systems,

intensive formal and informal on-the-job training and greater job security used to

characterize HRM practices in Korean firms, all of which are a result of an emphasis on

relationships between employees and supervisor/employer (Chung, Lee and Jung 1997).

Through this time of transition, job security based on reciprocal interpersonal relationships

had become less of an organizational norm in Korean firms, along with introduction of

performance- or market-oriented HR practices (Bae and Lawler 2000). This shift

exemplifies the anecdotal view of the HR director from a large Korean bank introduced in

the beginning of the current manuscript, such that ‘Interpersonal relationship was a magic

tool at that time. (But) . . . this is no longer true in the same organization (now).’ Thus,

interpersonal relationship factors may not be as important predictors of key HR outcomes

as they used to be before the 1990s.

Korean workers are also now less protected by the labor laws, which reflect such

transitions and changes. For example, the Korean Labor Standard Act, which prevents the

termination of employees without a just cause, added an exceptional cause of ‘discharge

upon business crisis’, which makes it possible for employers to lay off their employees for

reasons such as financial deterioration, structural adjustment, technical innovation and

change of business for productivity enhancement during the financial crisis in the late

1990s (Bae 1998). A field study also confirmed that Korean employees have become less

willing to accept the roles of connections and interpersonal relationships in an

organization. Instead, they have become increasingly market and performance oriented

(House, Hanges, Javidian, Dorfman and Gupta 2004). In sum, the importance of

interpersonal relationships and particularistic ties is diminishing in Korea while it has not

changed as much in China (Chang 2006; Bozionelos and Wang 2007; Tung et al. 2008).

Finally, Korea is also identified as relatively individualistic compared to other

collectivistic Asian cultures (Alston 1989; Hofstede 2007). Although Korean culture is

still viewed as collectivistic (Hofstede 2001, 2007), the popular Korean proverb that ‘one

Korean is stronger than three’ implies Koreans’ individualism orientation at least in part

(Alston 1989). With a higher individualism orientation, Korean employees are likely to

pay less attention to others, and consequently, the meaning of interpersonal relationship

becomes less significant in their organizational life compared with their more collectivistic

Chinese counterparts (Fahr et al. 1998). Based on the above discussions, we expect that the

relative importance of LMX and co-worker relationships in turnover intentions will differ

between Korea and China, as hypothesized below.

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Hypothesis 3a: The association between LMX and turnover intentions will be greater

in China than in Korea.

Hypothesis 3b: The association between co-worker satisfaction and turnover intentions

will be greater in China than in Korea.

Methods

Participants

We sent questionnaires to administrative office workers (i.e. marketing, HRs and finance) in

four Korea-based companies, which also have operations in Beijing, China. Two

organizations produce and sell electronic products and two organizations are from the

automobile industry. We purposefully selected Korean firms and their independent

counterparts operating in China instead of state-owned Chinese companies. State-owned

organizations in China have a different set of HRM practices and many organizational

variables would not be eligible for legitimate comparison with their Korean counterparts

(Warner 2004). Although all of the four organizations have headquarters in Korea, their

Chinese counterparts in Beijing are operating independently in terms of their budget and

financial control. Nine hundred questionnaires (350 and 550 for Korea and China,

respectively) were distributed via the HR department in 2007. The participation was

voluntary. With a promise to present the summary results by the researchers, the HR

department of each firm administered the questionnaires by distributing randomly and

collecting completed questionnaires. An on-site drop box was used to guarantee complete

anonymity, and some participants used a prepaid return envelope that the researchers provided

along with the questionnaires. The researchers made more than six follow-up visits to each

participating organization, and the HR department made company-wide announcement to

promote the survey participation during each visit. Overall, 824 (314 and 510 for Korea

and China, respectively) surveys were collected, reflecting a response rate of 91.6%.

We eliminated 26 Korean and 17 Chinese surveys due to missing values. To make appropriate

cross-national comparison, for the final analyses, we only included Chinese surveys obtained

from Chinese nationals under Chinese supervision. Consequently, the final samples

comprised 288 Korean and 230 Chinese participants. Participants were mostly non-

managerial employees (84.7% for Korean and 87% for Chinese). Regarding Korean

participants, 42% were staff members (the lowest rank) and remaining 42.7% were advanced

staff and assistant managers. Concerning Chinese participants, 80.1% were staff members and

the remaining 6.9% were advanced staff and assistant managers. In other words, Korea and

China were comparable in the proportion of non-managerial workers but the proportion of the

lowest rank (i.e. staff members) in Chinese sample was almost twice as high as that in Korean

sample. Overall, 87.2% of Korean and 92% of Chinese participants had college degrees or

higher, while 57.6% of Korean and 55.7% of Chinese participants were male. Demographic

information was generally comparable across Korean and Chinese samples, and we controlled

for all the demographic variables in order to attenuate any concern about sample

compatibility. Furthermore, we controlled for a firm’s identity in response to potential

concerns about possible differences among samples from four different organizations,

although the tests of a single firm might have been a potential strength.

Measures

The current study used measures validated in previous studies. The language in the

questionnaire was either Korean or Chinese. Based on a master survey in English, the

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researchers and their assistants used forward and backward translation methods to achieve

consistency with previous research conducted in English (Brislin, Lonner and Thorndike

1973). First, one of the bilingual Korean authors translated original English items into

Korean. The translated items were then revised according to the comments made by two

other bilingual graduate assistants. Subsequently, independent bilingual graduate assistant

back-translated Korean items into English. Now, the Korean author and the other three

graduate assistants worked together to produce the pilot questionnaire after reconciling

any discrepancies. Ten employees at one of the study sites reviewed the pilot questionnaire

to identify any ambiguity in the items. The Korean version of the questionnaire was

finalized after minor changes were made following the pilot review. The same process was

employed for Chinese version of the questionnaire. All of the variables were measured on

a scale ranging from 1 to 7, with (1) indicating ‘strongly disagree’ and (7) ‘strongly agree’

unless stated otherwise.

Leader–member exchange

Leader–member exchange was measured on a seven-item scale developed by Graen and

Uhl-Bien (1995). The alpha reliability was 0.87 and 0.85 for Koreans and Chinese,

respectively.

Co-worker satisfaction

Three items were used to measure co-worker satisfaction. An item measuring satisfaction

with co-workers was adopted from Cury, Wakefield, Price and Mueller’s (1986) job

satisfaction scale to which two additional items were added. Two additional items were

‘I had unhappy experiences with my co-workers (reversed)’ and ‘I have co-workers that I

do not like (reversed)’. The alpha reliability was 0.75 for the Korean sample and 0.74 for

the Chinese sample.

Turnover intention

Turnover intention was measured using four items developed by Becker (1992) that

combined the Michigan Organizational Assessment Questionnaire (Camman, Fichman,

Jenkins and Klesh 1979) and the Organizational Commitment Questionnaire (Porter,

Steers, Mowday and Boulian 1974). Sample items were ‘I often think about quitting’, and

‘There is not too much to be gained by sticking with the organization indefinitely’.

The alpha reliability was 0.84 for the Korean sample and 0.85 for the Chinese sample.

Control variables

Several demographic variables were included to control for individual differences.

Age was measured using five-category scale ranging from ‘below 20’ to ‘over 51’.

Organizational tenure was classified into six categories from ‘less than six months’ to

‘more than 10 years’. Four education categories included ‘high school’, ‘two-year college

degree’, ‘bachelor’, and ‘post-graduate degrees’. Organizational rank was measured using

seven categories ranging from ‘staff’ to ‘executives’. Experience of voluntary turnover

was measured using four categories of ‘none’, ‘once’, ‘twice’, and ‘more than three times’.

Gender was also measured. Three dummy variables were created to control for the four

different companies.

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Results

Analysis

We conducted an exploratory factor analysis of all items (except control variables) to

examine measurement invariance between Korean and Chinese respondents. The results

of the factor analysis with varimax rotation are presented in Table 1, confirming a three-

factor solution for all the items of LMX, co-worker satisfaction and turnover intention.

The factor structure was the same for Korean and Chinese samples; therefore, we are

convinced that both Korean and Chinese respondents ascribed the same meanings to the

scale items used in the current study (Milfont and Fischer 2010).

Descriptive statistics for both Korean and Chinese samples are presented in Table 2.

We tested our hypotheses using hierarchical regression analysis. We entered the control

variables in Step 1 and main effects of LMX and co-worker satisfaction in Step 2. In Step

3, we entered sample variable (0 for Chinese and 1 for Korean), its interaction terms with

LMX and co-worker satisfaction for the entire sample to test country moderation.

Variables forming the interaction term were centered to minimize multicollinearity among

the interaction terms and their components (Aiken and West 1991). In addition, we

conducted separate regression analyses using Korean and Chinese samples. All regression

results are presented in Table 3.

As per Hypotheses 1 and 2, both LMX and co-worker satisfaction were significantly

and negatively associated with turnover intentions for the entire sample (b¼20.14,

p , 0.01 and b ¼ 20.17, p , 0.001). However, separate regression results revealed that

LMX had a non-significant relationship with turnover intention for Korean workers

(b ¼ 20.04, n.s.) while this relationship was significant for Chinese workers (b ¼ 20.22,

p , 0.01). A test of the curvilinear relationship between LMX and turnover intentions of

Korean workers was conducted as well and was found to be non-significant (b ¼ 0.001,

n.s.). Another set of separate regressions of co-worker relationship with turnover

intentions revealed negative and significant relationships for both Koreans and Chinese

(b ¼ 20.15, p , 0.05 and b ¼ 20.24, p , 0.01, for Koreans and Chinese, respectively).

Therefore, Hypothesis 1 was partly supported while Hypothesis 2 was supported. Both

Hypotheses 3a and 3b were supported. The relationship between LMX and turnover

intentions was moderated by the sample such that their relationship was stronger in China

than in Korea (b ¼ 0.16, p , 0.05). In other words, Chinese workers’ turnover intention

was affected more by the relationship with their supervisors compared with their Korean

counterparts. Moreover, the relationship of co-worker satisfaction with turnover intentions

was stronger in China than in Korea (b ¼ 0.22, p , 0.05), which suggests that co-worker

satisfaction is a more important factor in forming turnover intention for Chinese workers

than their Korean counterparts. The significant results of both moderation tests are

consistent with our predictions that interpersonal relationships with both supervisors and

co-workers are more important predictors of turnover intentions in China than in

Korea.We divided each of the Korean and Chinese samples into high- and low-LMX and

high- and low-co-worker satisfaction groups by one standard deviation above and below

the mean (Aiken and West 1991), and the differences in turnover intentions between

Korea and China are shown graphically in Figure 1.

Discussion

We found a negative linear relationship between LMX and turnover intentions in Chinese

samples. The results are consistent with early LMX studies conducted in western settings

(e.g. Graen et al. 1982; Ferris 1985) and at the same time challenge the findings of a

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Tab

le1

.R

esu

lts

of

exp

lora

tory

fact

or

anal

ysi

so

fL

MX

,tu

rno

ver

inte

nti

on

and

co-w

ork

ersa

tisf

acti

on

.

Item

Korea

China

LMX

Turnoverintention

Co-worker

satisfaction

LMX

Turnoverintention

Co-worker

satisfaction

Iu

sual

lyk

no

wh

ow

sati

sfied

my

lead

eris

wit

hw

hat

Id

o0.49

20

.01

0.1

60.63

20

.01

0.1

2

My

lead

eru

nd

erst

and

sw

ell

my

job

pro

ble

ms

and

nee

ds

0.73

20

.06

0.1

40.78

20

.03

0.1

4

My

lead

erre

cog

niz

esw

ell

my

po

ten

tial

0.78

20

.07

0.0

30.82

20

.07

0.0

5M

yle

ader

wo

uld

use

his

/her

po

wer

toh

elp

me

solv

ep

rob

lem

sin

my

wo

rk0.74

20

.27

0.0

80.74

20

.21

0.1

5

My

lead

erw

ou

ld‘b

ail

me

ou

t’at

his

/her

exp

ense

0.79

20

.21

0.1

10.66

20

.10

0.0

7

Ih

ave

eno

ug

hco

nfi

den

cein

my

lead

erth

atI

wo

uld

def

end

and

just

ify

his

/her

dec

isio

nif

he/

she

wer

en

ot

pre

sen

tto

do

so

0.71

20

.16

20

.03

0.76

20

.13

20

.08

Iw

ou

ldch

arac

teri

zem

yw

ork

ing

rela

tio

n-

ship

wit

hm

yle

ader

as‘e

ffec

tiv

e’0.66

20

.15

0.1

70.75

20

.11

20

.01

Iw

ou

ldli

ke

tolo

ok

for

ano

ther

job

20

.10

0.81

20

.22

20

.06

0.79

20

.23

Io

ften

thin

kab

ou

tq

uit

tin

g2

0.1

50.74

20

.16

20

.12

0.81

20

.04

Th

ere

isn

ot

too

mu

chto

be

gai

ned

by

stic

kin

gw

ith

the

org

aniz

atio

nin

defi

nit

ely

20

.20

0.82

0.0

12

0.1

30.81

20

.05

Iw

ou

ldle

ave

my

org

aniz

atio

nif

thin

gs

are

get

tin

gw

ors

e2

0.1

40.75

20

.17

20

.11

0.77

20

.17

Ife

elfa

irly

wel

lsa

tisfi

edw

ith

my

co-w

ork

ers

0.2

32

0.0

50.69

0.3

72

0.0

90.51

Ih

adu

nh

app

yex

per

ien

ces

wit

hm

yco

-w

ork

ers

(rev

erse

d)

20

.01

20

.24

0.81

20

.01

20

.18

0.85

Ih

ave

co-w

ork

ers

that

Id

on

ot

lik

e(r

ever

sed

)0

.15

20

.13

0.78

0.0

42

0.1

50.83

Var

ian

ceex

pla

ined

by

each

fact

or

3.6

62

.69

1.9

23

.75

2.5

21

.80

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Tab

le2.

Des

crip

tive

stat

isti

csan

dco

rrel

atio

ns.

a

Mean

SD

ChinesenKorean

Variable

Korean

Chinese

Korean

Chinese

12

34

56

78

9

1.

Gen

der

1.4

21.5

20.4

90.5

02

0.3

8**

20.2

1**

20.5

6**

20.2

8**

20.0

62

0.1

02

0.0

82

0.0

1

2.

Age

3.0

52.0

70.9

10.3

02

0.1

02

0.0

42

0.6

4**

20.5

8**

20.1

8**

20.0

92

0.0

92

0.1

9**

3.

Educa

tion

level

2.5

82.7

80.8

50.5

82

0.0

82

0.2

1**

20.2

8**

20.0

92

0.2

1**

20.1

5*

*2

0.1

5*

20.0

4

4.

Org

aniz

atio

nal

rank

1.8

51.3

81.9

81.8

82

0.0

22

0.4

7**

20.0

52

0.5

62

0.1

4*

20.1

3*

20.0

92

0.0

8

5.

Org

aniz

atio

nal

tenure

3.9

12.7

01.5

91.0

32

0.0

32

0.1

7*

20.2

4**

20.1

4*

20.0

22

0.1

2*

20.1

02

0.1

0

6.

Turn

over

exper

ience

2.1

31.7

01.0

50.9

12

0.0

12

0.2

6**

20.1

8**

20.1

9**

20.0

42

0.0

42

0.0

42

0.1

0

7.

LM

X4.2

04.3

41.1

61.0

62

0.0

10.0

02

0.0

22

0.0

22

0.1

10.0

72

0.3

3**

20.0

9

8.

Co-w

ork

ersa

tisf

acti

on

4.4

24.8

61.1

21.2

22

0.0

02

0.0

62

0.0

12

0.1

32

0.1

22

0.0

32

0.5

3*

*2

0.1

7**

9.

Turn

over

inte

nti

on

3.8

63.7

61.0

41.0

32

0.0

32

0.0

72

0.0

72

0.1

12

0.2

6**

20.0

32

0.3

7*

*2

0.3

9**

No

te:n¼

28

8(K

ore

an),

23

0(C

hin

ese)

.*

*p,

0.0

1,

*p,

0.0

5.

aC

orr

elat

ions

for

Kore

ansa

mple

sap

pea

rab

ove

dia

gonal

and

Chin

ese

sam

ple

sbel

ow

dia

gonal

.

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Tab

le3

.R

esu

lts

of

hie

rarc

hic

alre

gre

ssio

nan

aly

ses.

Turnoverintentions(KoreansandChinese,

n¼

51

8)

Turnoverintentions

(Koreans,n¼

28

8)

Turnoverintentions

(Chinese,n¼

23

0)

Variables

Step1

Step1

Step3

Step1

Step2

Step1

Step2

Gen

der

20

.04

20

.04

20

.05

20

.08

20

.09

20

.02

20

.02

Ag

e2

0.2

2*

*2

0.2

1*

*2

0.2

4*

*2

0.2

4*

*2

0.2

4*

*2

0.0

22

0.0

2E

du

cati

on

lev

el2

0.0

52

0.0

12

0.0

22

0.0

32

0.0

10

.00

20

.02

Org

aniz

atio

nal

ran

k0

.05

0.0

40

.02

0.0

30

.02

0.0

70

.04

Org

aniz

atio

nal

ten

ure

0.1

6*

*0

.16

**

0.1

4*

0.0

60

.08

0.2

7*

**

0.2

1*

*

Tu

rno

ver

exp

erie

nce

0.1

1*

0.1

0*

0.1

0*

0.1

4*

0.1

3*

0.0

10

.03

Co

mp

any

A(d

um

my

)0

.09

0.1

00

.08

0.0

90

.10

0.0

70

.04

Co

mp

any

B(d

um

my

)2

0.0

52

0.0

52

0.0

32

0.0

62

0.0

72

0.0

10

.02

Co

mp

any

C(d

um

my

)2

0.0

42

0.0

22

0.0

22

0.0

62

0.0

42

0.0

22

0.0

2L

MX

20

.14

**

20

.25

**

20

.04

20

.22

**

Co-w

ork

ersa

tisf

acti

on

20

.17

**

*2

0.3

7*

*2

0.1

5*

20

.24

**

Sam

ple

0.0

7L

MX£

sam

ple

0.1

6*

Co-w

ork

ersa

tisf

acti

on£

sam

ple

0.2

2*

R2

0.0

50

.11

0.1

40

.08

0.1

00

.08

0.2

3A

dju

sted

R2

0.0

30

.09

0.1

20

.05

0.0

70

.04

0.2

0F

2.8

7*

*5

.90

**

*6

.01

**

*2

.57

**

2.8

5*

*2

.14

*6

.07

**

*

Sta

nd

ard

ized

coef

fici

ents

are

rep

ort

ed:

*p,

0.0

5;

**p,

0.0

1;

**

*p,

0.0

01

.

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U-shaped relationship between LMX and turnover intentions (e.g. Harris et al. 2005;

Morrow et al. 2005). The critical difference between linear and U-shaped relationship

concerns turnover intentions of high-quality LMX employees. Harris et al. (2005) argued

that employees high in LMX are pulled away psychologically by the attractiveness of

alternative jobs since they are now equipped with better skills and capabilities gained from

obtaining developmental benefits from their supportive supervisors. Given that turnover

intention is a function of both pushing from within (i.e. dissatisfaction with the current

employer) and pulling from outside (i.e. attractiveness of an alternative employer) (Bretz,

Boudreau and Judge 1994), they further implied that pulling forces compensate for lack of

pushing forces in turnover intentions of high LMX employees (Harris et al. 2005).

However, our findings suggest that the pulling effect for high LMX employees is not

strong enough to offset the intention to stay with the current employer in such a

relationship-oriented society as China. Instead of intending to leave their current employer

using the resources resulting from high-quality exchange, Chinese employees who had

quality relationships with their supervisor had less intention to leave because of stronger

socio-emotional ties with their employer.

We should note that the current study found no association between LMX and turnover

intentions of Korean employees. A possible explanation for this finding is the radical

transition of Korean organizational culture from relationship orientation to market

orientation in the 1990s, as discussed previously. Also, our finding is consistent with the

general findings that the role of interpersonal relationships with supervisors in explaining

employee behaviors and attitudes is decreasing in Korean organizations (Chung 2002;

Chang 2006).

It would be useful to discuss the reasons behind the aforementioned changes from

relationship orientation to market principle to understand better Korean HRM in the global

context. First, a dramatic increase in foreign direct investment (FDI) into Korea since the

late 1990s helped globalize Korean business environment and push Korean firms to

change, benchmark and follow global best practices, resulting in a transformation of

Korean HRM toward a more market principle (Rowley and Bae 2002). While providing a

rescue package for Korea under financial crisis in 1997, International Monetary Fund

requested that the Korean government open the market to foreign investors. The Korean

government responded by establishing the Foreign Investment Promotion Act in 1998 to

facilitate direct investment from foreign organizations, which triggered a steep increase in

2

2.5

3

3.5

4

4.5

2

2.5

3

3.5

4

4.5

Low High

LMX

Turn

over

Inte

ntio

ns

Low High

Co-worker Satisfaction

Turn

over

Inte

ntio

ns

KoreanChinese

KoreanChinese

Figure 1. Turnover intentions, leader–member exchange and co-worker satisfaction.

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FDI into Korea. For example, the total FDI volume for the period of 1991–1997 was US$

14,452 million, US$ 5155.6 million for 1998 (Kim 1999) and US$ 13.07 billion for 2010

(Invest Korea 2012).

Second, large-scale layoffs in the late 1990s as a result of the amended Korean Labor

Standard Act helped Korean workers realize that interpersonal relationship is not as

important for their employment as before. In actuality, a typical Korean firm that survived

bankruptcy in the early financial crisis laid off 18–30% of their workers in 1998 (Lee 1998).

As a result, Korean workers realized that they could be laid off at anytime against their will

and viewed employment contract as a free agreement that could be broken by the employer

as well as by the employee at any time. These changes accelerated transition of core

ideology behind Korean HRM from community or relationship to market efficiency or

market principle (Rowley and Bae 2002).

Third, Korean firms that survived and developed from the Asian crisis further steered

the transformation of Korean HRM through adopting western HRM practices via active

foreign businesses. The volume of FDI by Korean firms into foreign countries increased

from US$ 3.8 billion in 1998 to US$ 44.5 billion in 2011 (National Archives of Korea,

http://www.archives.go.kr/). The over 10-fold increase in Korean firms’ FDI since the

Asian financial crisis implies a greater number of globalization activities, adoption of best

practices and a greater convergence toward a western HRM model (Rowley 1997; Rowley

and Bae 2002).

In sum, the reasons behind the changes in Korean HRM since the 1990s are consistent

with the model of HRM convergence proposed by Rowley and Bae (2002). According to

this HRM convergence model, globalization triggers frequent contacts between

organizations employing different HRM practices and causes HRM convergence that

occurs via adoption of best practices. National systems that are less resistant to change

make transfer possible and allow HRM practices to converge. The case of Korea described

above is a great illustration of this model, since globalization during and after the Asian

financial crisis caused convergence of HRM through the active transfer of HR practices

based on the western HRM model.

We also should note that the changes discussed above are still ongoing and are

progressing towards a full market principle in Korea. The lack of association between LMX

and turnover intention in the current study is a clear indication that the role of interpersonal

relationship is decreasing in the Korean HRM. However, if the Korean labor market was

governed solely by market principle, then we would have been able to replicate the

U-shaped association between LMX and turnover intentions. However, such phenomena

were not observed in the current study of Korean workers. This may imply that the market

principle still does not fully govern Korean workers, and the relationship orientation, such as

loyalty, may still play a role in HR-related decisions in Korea.

The significant interaction results as per Hypotheses 3a and 3b suggest that the

relationships of turnover intentions with LMX and co-worker satisfaction are greater

among Chinese employees compared with their Korean counterparts. In actuality, LMX

and co-worker satisfaction explained only 2% of additional variance in turnover intentions

of Koreans while explaining additional 16% for Chinese (see Table 3 for R 2 comparison).

This implies significant differences between Korea and China in the meanings and roles of

interpersonal relationships.

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Limitations and implications

The current study has some limitations. First, the current study presents correlational

analyses based on cross-sectional data. Correlational studies do not necessarily confirm

causal directions. Although the direction from LMX and/or co-worker satisfaction to

turnover intentions seems plausible, the opposite direction is also possible. For example,

supervisors may view employees with less intention to turnover as more committed, and

their relationship may develop in a better direction. We expect a future study with

longitudinal data to address the question of causality.

Second, the use of self-report measures creates the potential for common method bias.

Following the recommendations by Podsakoff, MacKenzie, Lee and Podsakoff (2003), we

conducted a confirmatory factor analysis to examine the fit of a model in which all items

were forced to load on a single factor. If the common method variance is largely

responsible for covariation among the measures used in the study, a one-factor model

should indicate a good fit to the data (Podsakoff and Organ 1986; Podsakoff et al. 2003).

A one-factor model did not fit the data well (CFI ¼ 0.42, NNFI ¼ 0.32, IFI ¼ 0.38,

RMSEA ¼ 0.17). The above analysis confirms that the common method bias is not a

likely explanation of reported findings. However, multi-source data such as dyadic pairs of

leader–member responses, in addition to self-reported survey, may help prevent any

potential concerns about a common method bias and may also provide stronger results in

future HRM studies.

Third, the current study was performed based on a few organizations operating in Korea

and China. We should be cautious when interpreting the results reported in the current study.

We cannot generalize the current findings to other Korean and Chinese firms without

considering the context in which those organizations are embedded. Although we only

relied on Chinese workers supervized by Chinese boss, some may question whether the

Korean firms in China are truly Chinese culture firms. We also should pay a careful attention

to regional differences in China when interpreting the results of the study (Tung et al. 2008).

All Chinese operations in the current study were based in Beijing, which is ‘more

relationship-focused’ (Tung et al. 2008, p. 63). The findings of the current study, which

suggested that Chinese workers’ turnover intention was affected more by interpersonal

relationship with supervisor and co-workers compared with Korean workers, may not have

been obtained if the current study had relied on Chinese workers in Shanghai, which is

‘bottom-line oriented’ and ‘materialistic’ (Tung et al. 2008, p. 63). Likewise, current

findings should not be applied to other Korean operations elsewhere (such as the US and

Europe) without considering the exact context of the region, nation and culture.

Fourth, some may question whether the current study has identified the most critical

turnover intentions variables given the relatively low R 2 reported. R 2 was particularly low

for the Korean sample (R 2 ¼ 0.10) in comparison to the Chinese sample (R 2 ¼ 0.23).

However, this is consistent with one of the major findings of the current study, which

indicated that interpersonal relationship, such as LMX and co-worker satisfaction, is a less

important factor for turnover intentions in Korea than in China. Furthermore, the current

study did not necessarily intend to explore a comprehensive list of predictors of turnover

intentions, and the relatively low R 2 for specific subsample of the current study

(i.e. Korean sample) should not be much of a concern. However, we acknowledge that the

inclusion of other relevant variables might have offered a more thorough understanding

with regard to turnover intentions with increased R 2.

Despite the noted limitations, the current study provides both practical and theoretical

implications for the field of organizational behavior and HRM. The current findings

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suggest that intra-Asia as well as East–West cultural differences exist and further imply

that managerial competencies required for effective organizations may vary across

cultures. While excessive socio-emotional support from a supervisor may result in

employees leaving their employers in western organizations (Harris et al. 2005; Morrow

et al. 2005), it may motivate employees to stay with the organization in more relationship-

oriented culture, such as China. On the other hand, supervisors should pay more attention

to other types of resources in addition to socio-emotional support in order to retain

employees in a society such as Korea.

The current study also provides implications for future research in relevant areas. We

focused on cross-cultural variation in relationship orientation while investigating relative

importance of a socio-emotional relationship with supervisor and co-workers. Relationship

orientation may also differ across individuals depending on their schemas, experiences and

eventually their psychological contract with the employer (Rousseau 1995). For example,

some employees are more oriented toward economic transactions while others are more

toward social exchange when they define their relationship with the employer (Rousseau

1995). Future studies should investigate direct antecedents of differences in relationship

orientation to add to our understanding of human behavior in organizations.

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