The Impact of Middle Managers on Employees’ Responses to a Merger: An LMX and Appraisal Theory Approach

Abstract

This study investigated how middle managers can facilitate change by affecting subordinates’ affective responses and attitudes towards a merger. We utilized leader-member exchange theory and appraisal theory to argue that employees who have a high quality exchange relationships with their supervising manager would be provided with more change information and opportunities for participation in the change, and, in turn, would have more positive affective perceptions of the change in terms of trust, cynicism, uncertainty and control, and subsequently be more open to the change. Multi-group analysis was applied to data of 326 employees of two health insurance companies that were involved in a merger. The findings largely supported the research model, suggesting that middle managers can facilitate change by developing high-quality relationships with their subordinates, and addressing employees’ affective perceptions of the change through change information and change participation. Our focus on the middle managers’ relationship with their employees offers theoretical and practical insights into the affective and attitudinal processes that occur during organizational change. MAD statement This study aims to Make a Difference by exploring how employees’ reactions to a planned organizational change can be influenced by their supervisor. This study emphasizes the importance of the work (exchange) relationship of middle managers and their subordinates. Employees who experienced a qualitatively better relationship felt better about the change because they were given more change information and opportunities to participate, and were more open to the change. So it seems that middle managers can have a vital role in the effective implementation of planned change.