Leader-Member Exchange Theory (LMX), first appeared in 1975 developed by Dansereau, Graen, and Haga, seeking to explain leadership through the analysis of relationships between managers and team members (PSU WC, L. 8, 2019). Relationships are developed through leader-follower interactions, constituting the behavioral influence leaders and followers have on one another (Northouse, 2016). This approach is not about what kind of traits leaders have, but rather how the quality of the relationship between leader and subordinate affects job productivity and satisfaction. LMX is the chemistry between leader and follower (PSU WC, L. 8, 2019).
The characteristics of followers define two distinct groups: the in-group and the out-group (Northouse, 2016). The in-group members, as described by Northouse, typically go above and beyond their normal job responsibilities (2016). The out-group members do the minimal amount of work required to complete a task (Northouse, 2016). In contrast, the in-group thrives on challenging new tasks and the out-group shies away from new and different job responsibilities. According to the PSU WC lesson commentary (2019), these follower behaviors influence the type of connection between leader and follower; based on an employee’s aspirations a leader will offer opportunities to achieve higher levels of success, or in the absence of ambition not consider an employee for opportunities. Research has found there is an association between LMX and performance (Graen & Uhl-Bien, 1995; Gerstner & Stilwell, 1993), high-quality leader-member exchanges result in stronger follower commitment and increased satisfaction.
LMX theory also focuses on the development of leader-member relationships over time (Northouse, 2016). Graen & Uhl-Bien (1991) describe this development in three-phases: stranger, acquaintance, and partnership. In the first phase, the exchanges are low-quality because the leader and follower are not familiar with each other’s behaviors and expectations. The follower is focused on self-interests at this time and closely follows the instructions given by the leader. As Northouse (2016) explains in the text, over time, trust develops based on interactions between the leader and follower, expectations of behavior have been established and the relationship has moved to the acquaintance phase. The last phase is achieved when the leader tests this relationship by offering a new challenge to the follower. Finally, if the leader and member establish a healthy acquaintanceship relationship, the leader may test partnership by putting more trust in the member (Northouse, 2016). Partnership relationships are noted by their reciprocal nature, high-quality interactions, and established respect (Northouse, 2016). LMX is an excellent framework for understanding relationships between leaders and followers because it provides both a description of leadership, the existence of in- and out-groups and their effect on the relationship, and a prescription for leadership through relationship testing and building (PSU WC, L. 8, 2019).
The in-group becomes the leader’s go to people for any additional tasks and projects that they need assistance with. It is wonderful to have a leader you get along with and has ultimate confidence in you. While being part of the in-group does require you take on more responsibility, you are also more likely to receive more rewards. These rewards not only take the form of monetary gain but also as a wider range of opportunities. I have been in this position before; I met Peter when I started working at “Company X” he was a co-worker/ peer of mine. This was the “stranger” to “acquaintance” phase of our relationship. I found him to be a nice guy with a great attitude and he was ambitious. One day he was promoted to be the supervisor of our group. I was happy for him, so were others from our group, but not everyone felt that way. There were some who felt Peter wasn’t the best choice for the position. Peter attempted to make peace with these individuals; he tried to gain their confidence and respect. It didn’t work; these out-group members didn’t want to be a part of Peter’s group or plan to improve our processes. The more Peter tried, the more they dug in their heals; this was when Peter started to lean on others in the group for support. Our relationship shifted to the “partnership” phase, as I was part of the in-group he relied on to do the heavy lifting. Regardless of the out-group’s constant complaints about the changes we were making, we completed several projects which lead to improvements in our efficiency. Upper management took notice of our accomplishments and when it came time to report the details of our efforts, Peter trying to be the “nice guy” included the out-group members to receive credit. A few of the out-group members felt guilty and their attitudes towards him softened, but others saw it as an opportunity to do even less.
A criticism of the LMX theory is the in-group can be seen as a clique formed by the leader; this can put the out-group at odds with the leader and in-group(Northouse, 2016). But the reality is, not all out-group want to be a part of the in-group. So how do you get the most out of these individuals? How do you get them to participate? My suggestion would be to apply the psychodynamic theory. To attempt to understand what drives these individuals, once you understand what motivates them, you can tailor your approach to lead them (Northouse, 2016).
References
Northouse, P. G. (2016). Leadership theory and practice (7th ed.). Los Angeles, CA: Sage.
Pennsylvania State University World Campus. (2019). Lesson 8: Leader-Member Exchange Theory (LMX). PSYCH485: Leadership in Work Settings. Retrieved June 14, 2019, from https://psu.instructure.com/courses/1985970/modules/items/26589530
Terry Chavez says
The biggest thing I took away from the lesson and text about LMX is the importance of a leader to recognize that it happens and the effects of these in and out groups. In fact, from Leadership Theory and Practice, “LMX theory suggests that it is important to recognize the existence of in-groups and out-groups within an organization” (Northouse, 2016, p.144) While often unintentional, the formation of these groups is something that occurs from the earliest stages in our lives. Humans are social by nature, and flocking into groups is something we do by instinct, recognizing their existence can aid in minimizing any negative consequences of their inevitable formation.
When these groups form in the workplace, they can have both positive and negative consequences. From a leadership perspective, we want to create the most productive and positive environment possible, and paying special attention to this innate group formation will help to minimize the negative consequences. Many researchers determined that positive LMX relationships result in low employee turnover, more promotions, higher levels of organizational commitment, innovation, empowerment and career progress, to name a few (Northouse, 2016, p.146). These organizational characteristics are highly valuable and can be developed by being cognizant of the relationships between leader and follower.
In one of the case studies presented in Leadership Theory and Practice, a workplace dyad is described from the perspective of several groups. There is the “in” group, and three “out” groups at this organization. The perception, productivity and morale of the out groups differs quite a bit from the group considered to be in with the leader. They are perceived as being the most productive, and given the best accounts to work on as compared to the other teams. This perception leaves the other teams feeling slighted and under motivated to compete against the in-group team. Overall, this environment is counterproductive to the organization as a whole. In this case the leader has opportunity to address the relationship gaps with the remaining three teams and move them into a better place.
The text sums up pretty simply how we can apply this theory successfully; “be aware of how we relate to our followers” (Northouse, 2016, p.149). Instinctively, we will drift to those we feel we relate to but there is the opportunity to build stronger relationships with all of our team or group members to promote positive outcomes. In some cases, it will be harder to develop these high-quality exchanges, but that is where the leader needs to be authentic, consistent, determined and fair as we build the necessary relationships with our teams.
References
Northouse, P. G. (2016). Leadership theory and practice (7th ed.). Los Angeles, CA: Sage
bjh5720 says
Terry,
That’s a fascinating case you’ve discussed regarding Leader-Member Exchanges (LMX). Your coworker certainly took to heart the leadership making approach that LMX offers (PSU WC, 2019, L. 8). Northouse (2016) notes that leadership making is especially useful because it allows leaders to create partnerships across the organization that are beneficial for them and the organization. As your careers progress, the partnership that you’ve developed could prove useful in your subsequent roles. I think, too, that your co-worker was right to try with all of his reports. Nurturing high-quality relationships with all followers is important and is prescribed by LMX (PSU WC, 2019, L. 8).
Certainly, though, some followers will not match with the leader for a whole number of reasons. In thinking of your closing statement, that psychodynamic approaches could be used to understand the situation is quite insightful. The psychodynamic approaches ask us to use the Clinical Paradigm to better understand our motives and behaviors and how that affects our interactions with others (Northouse, 2016). From the clinical perspective, your coworkers who resisted or seemed to resent Peter’s promotions had a rationale behind their behaviors, no matter how irrational it seemed, psychodynamic approaches would argue (Northouse, 2016). It could be simple jealousy, they felt they or their friend were better qualified, it could be a matter of Peter being a relatively new team member, or something else entirely. The point is this: they have their reasons, no matter how petty, silly, or childish they may seem. I use those descriptors intentionally, as your description of your coworkers painted a picture of pettiness. Second, are they motivated to watch Pete fail? Are they motivated to do the least possible? There’s something there for sure, there is a motivator to their behavior. Third, their behaviors are probably noticeable by others and can facilitate other behaviors. Finally, is there a culture of cut-throat competition? Is it an up-or-out situation? Was the last boss bad? Does Pete remind them of the last boss?
For Pete to overcome their resentment, it seems, he attempted to adapt his ego state and behaviors to match their needs, he attempted to make his personality fit theirs (PSU WC, 2019, L. 3). This is where the psychodynamic approaches and LMX overlap. LMX asks leaders to flex to their follower’s needs in exchanges, psychodynamics explain how personalities and perceptions create the effect (PSU WC, 2019, L. 8; PSU WC, 2019, L. 3). Pete would do well to consider his followers using psychodynamics. He should also look for opportunities to improve relationships with out-group members. From a practical perspective, you described several members stepping up after receiving unearned praise. That’s an excellent time to start leadership making, as strangers have moved into the acquaintance phase (Northouse, 2016).
In all, you’ve made some excellent points. I think Peter has an interesting road ahead of him, too.
References
Northouse, P. G. (2016). Leadership theory and practice (7th ed.). Los Angeles, CA: Sage
Pennsylvania State University World Campus (2019). PSYCH 485: Leadership in work settings. Retrieved from https://psu.instructure.com/courses/1985970/
Michelle Lew says
With the in-groups and out-group contrast grows in an organization, it is even more stark how roles group/team effects become more significant. This contrast of the in- versus out-group reactions to Peter’s promotion seemed to grow even more distant than before. As a team holds “a single mission or goal, each member of the group is responsible for a separate piece of the task that is then combined into the final product” (PSU WC, 2019, L. 9, p. 2). With tasks divided, it is clear that the in-group holds the individuals more likely to take on more responsibilities and may even complete those that the out-group is accountable for but slack off on. As Peter first starting working with Company X during the “stranger” phase of LMX theory, the group stage of forming – or “information gathering about fellow members” (PSU WC, 2019, L. 9, p. 3) – is in play. The team followed suit with other group stages of storming, norming, and performing (Tuckman, 1965). However, when Peter was promoted, the group dynamic was drastically altered, causing the team to recede back to the norming stage with the new leader and re-development of group norms. As the out-group’s nonacceptance of Peter’s new authority position increases, social loafing grows rampant and begins to infringe on overall productivity. Social loafing is “a reduction in effort that occurs when individuals do less work because no person is responsible for the outcome” (PSU WC, 2019. L. 9, p. 3). Each individual does not feel that they are an active contributor to the group or that their efforts are not significant enough to make a difference. This in turn creates a lack of personal accountability as the out-group is aware that someone from the in-group will finish their responsibilities for them. This becomes the new norm for the whole team and the out-group and in-group grow in contrast.
As team effectiveness is defined by performance and development (Northouse, 2016), Peter’s position seems to perform adequately, but lacks in overall development. Nadler (1998) differentiates these two qualities as “performance refers to the quality of the outcomes of the team’s work” while “development refers to the cohesiveness of the team and the ability of team members to satisfy their own needs while working effectively with other team members.” With the clear results of projects with improving productivity and efficiency, goals are determined with a defined results-driven structure. Competency aside, the lacking factor is unified commitment and collaboration of the team as a whole. As the team is instead treated as a collection of individuals, there is no sense of connection between the in-group and out-group. Commitment may be unified in each respective group, but not when combined. When standards of excellence and certain individuals (especially in Peter’s case) are recognized by upper management, the organization is providing what Wageman et al. (2009) considers a supportive organizational context with “material resources, rewards for excellent performance, an educational system to develop necessary team skills, and an informational system to provide data needed to accomplish the task.” This external recognition is an outcome created through promoting individuals to become part of the in-group and work above and beyond their basic job requirements.
As Peter includes the entirety of the team, both in-group and out-group members, he displays principled leadership and is the central driver over overall effectiveness (Zaccaro, Heinen, & Shuffler, 2009). The team is still considered a cohesive group rather than the two cliques that are present within. Comprehensively, the group is able to be motivated towards a goal and is highly coordinated with matching each members’ abilities to their tasks. What is present, though to a lesser extent, in Peter’s case is cognitive understanding of problems in the group as well as Affective situations in handling stressful circumstances. Though it might be due to lack of information in the above blog, Peter might be lacking the leadership skills necessary for confrontation of the social loafing in the out-group and instead continuing to give them equal share of the resulting benefits. It would be interesting to understand his leadership style and the overall leadership structure of Company X.
Resources:
Nadler, D. A. (1998). Executive team effectiveness: Teamwork at the top. In D. A. Nadler & J. L. Spencer (Eds.), Executive teams (pp. 21-39). San Francisco: Jossey-Bass.
Northouse, P.G. (2016). Leadership: Theory and Practice. Los Angeles, CA: Sage Publications.
Pennsylvania State University World Campus (2019). PSYCH 485 Lesson 9: Team Leadership. Retrieved from https://courses.worldcampus.psu.edu/canvas/su19/2195min-5376/content/09_lesson/printlesson.html
Tuckman, B. W. (1965). Developmental sequence in small groups. Psychological Bulletin, 63, 384-399.
Wageman, R., Fisher, C. M., & Hackman, J. R. (2009). Leading teams when the time is right: Finding the best moments to act. Organizational Dynamics, 38 (3), 192-203.
Zaccaro, S. J., Rittman, A. L., & Marks, M. A. (2001). Team leadership. Leadership Quarterly, 12, 451-483.