Leader Member Exchange can be a very effective leadership style. I have seen it in use and tend to use this style myself. I have also bore witness to this style going horribly wrong and bringing productivity to a screeching halt. I think a well developed training program for this style would be very beneficial for any cooperation.
When the Leadership Member Exchange is functioning smoothly in a leadership making style all parties involved enjoy what they are doing and are motivated to work (Northouse, 2013). I have seen this style many times in use in the Navy and I have even used it to great success with my own boat crews in the Navy. Leaders that form relationships with their subordinates know what their strengths and weaknesses are. The leader also can then help these individuals to overcome their weaknesses. Keeping all group members informed and treated as equals in reciprocal influences and able to negotiate their role helps to build trust between the leader and group (Northouse, 2013). I find it also greatly increases morale, even in some of the worst conditions imaginable. Subordinates feel a sense of loyalty to the leader and do not mind going above and beyond their job description. It is an enjoyable productive experience, which makes all group members from the leader to the most junior group member stronger as everyone pushes themselves and each other to be better.
When the Leadership Member Exchange goes wrong it is an awful train wreck that has very little production. I have seen time and time again where a leader does not have a good relationship with all group members and in-group vs. out-group rivalries form. Out-group members do not feel treated fairly and feel that their efforts are not appreciated (Northouse, 2013). I suspect out-group members even become a little jealous and resentful or the in-group members getting the better jobs and having influence with the leader. This can lead to direct conflict between the two groups. The leader does not hold much respect from the out-group members; they may only respect the leaders positional authority. If the leader does not use a leadership making style with all employees dissension and conflict is inevitable as well as a loss of production.
For these reasons I believe Leadership Member Exchange is very important. Northouse points out a major weakness in that the theory is rather vague and missing details on how to foster a leadership making relationship; nor is there any training program for companies (Northouse, 2013). I think this is an area that many companies and leaders might benefit from if some clarity and direction were given. I think the creation of good training on the Leadership Member Exchange is desperately needed, since the benefits can be high performance and group cohesion.
References:
Northouse, P.G. (2013). Leadership theory and practice (6th ed.). Thousand Oaks, CA: SAGE Publications Inc.