According to Northouse (2016), the main emphasis of leader-member exchange (LMX) theory lies in dyadic relationships between the leader and each individual follower, where the achievement of deeply reciprocal connections is expected to boost performance, organizational commitment, and motivation. In essence, LMX theory, as described by Graen & Uhl-Bien (1991 as cited in Northouse, 2016), explains “how exchanges between leaders and followers can be used for leadership making” (p.142). As a result, LMX theory offers a unique descriptive approach, suggesting that successful dyadic exchange relationships create specific in-group dynamics, often associated with increased positive organizational behavior, which further lead to organizational growth and development. From the prescriptive standpoint, LMX theory encourages leaders to develop individual relationships with their employees through the specifically assigned stranger, acquaintance, and mature partnership phases (Graen & Uhl-Bien, 1991, as cited in Northouse, 2016). Therefore, we arrive to an almost complete strategy for developing leadership effectiveness within organizations, that, in theory, leaves all in-group members satisfied and committed to their organizational objectives. However, while seemingly ideal, this approach to LMX theory is not only time and effort consuming, if not impossible in large or geographically dispersed teams, it also lacks comprehensive understanding of the working intergroup dynamics. As a recourse to these limitations, utilizing the social identity theory, according to which people are motivated by either their personal or social identity (Ellemers, de Gilder, & Haslam, 2004), might add more to our knowledge and, potentially, to our tools of utilizing leadership to motivate groups of people.

The unique property of leadership lies in its potential to identify relationships for the purpose of influencing others to “embrace, as their own, new values, attitudes, and goals and to exert efforts on behalf of and in pursuit of those values, attitudes, and goals” (Hogg et al., 2005, p.991). Significantly, these relationships almost always exist within specific groups, the boundaries of which are defined by the established values, attitudes and goals (Hogg et al., 2005). As such, membership to groups depends on one’s desire to adopt the objectives set by the leader as well as his/her capacity to share the group identity. If applied correctly, LMX theory proposes that effective leadership would develop high-quality LMX relationships, which in turn would bind the subordinates “through loyalty, gratitude, and a sense of inclusion” (Hogg et al., 2005, p.992). However, the primary focus on individual leader-member relationships as described in LMX theory leads to a narrow view of the dyads as if removed from other dyads and the group as a whole (Hogg et al., 2005). Consequently, not much is being discussed about the role of leaders in development of social identity in creating high-level dyads within groups at large.

As Ellemers, de Gilder, and Haslam (2004) argue, one of the most important determinants of leadership potential to “energize, direct, and sustain particular work-related behaviors in their followers” (p.465) is leader’s ability to communicate and create a sense of shared identity within a group. Considering the discussed limitation in practical applications of LMX dyads’ formation, the emphasis must be made on whether leaders are perceived as sharing the same collective identity, which effectively defines them as in- versus out-group members. Seen as a group phenomenon, leadership within social identity approach focuses on situational factors that might enhance (or destabilize) the leader’s ability to apply the sense of shared identity as a motivational force. In fact, Ellemers, de Gilder, and Haslam (2004) propose that leadership behaviors amongst leaders, who are perceived to share a common identity with followers, are seen as expressions of the “true self,” with the opposite also being true. In other words, social identity perspective allows us to understand whose directives are most likely to be effective in informing and transforming the subordinates. Furthermore, Ellemers, de Gilder, and Haslam (2004) argue, that a failure to establish a sense of shared social identity might break the overall determination towards the collective objectives, where the individual goals become more important. Interestingly, choosing a leader who is remarkably superior to the rest of the followers can threaten the instilment of common identity in the group, thus posing further challenges to leadership emergence and effectiveness (Ellemers, de Gilder, and Haslam, 2004). Simply put, if followers fail to identify their leader as someone fitting the group’s prototype (Hogg et al., 2005), there is little opportunity for the leader to be effective.

Ultimately, it is apparent that leaders carry many responsibilities when attempting to mobilize groups of followers towards organizational objectives. While the theoretical foundation of LMX theory underlines the significance of developing unique and fulfilling leader-member relationships, much can be added in terms of additional factors that can highly influence the outcomes. As discussed, the potential of any leader to share group identity is essential to his/her followers’ abilities to prioritize the collective goals over their personal goals. As Northouse (2016) suggests, if leaders and followers can achieve better dyadic exchanges, “they feel better and accomplish more, and the organization prospers” (p.142). To add to that, leaders should facilitate the creation of an environment of strongly shared group identity amongst all group members. By focusing on followers’ social identity as defined by the membership in a specific group, leaders can foster deeper levels of commitment to the organizational objectives even if those are in opposition to the personal ones.

References

Ellemers, N., De Gilder, D., & Haslam, S. A. (2004). Motivating individuals and groups at work: A social identity perspective on leadership and group performance. Academy of Management review, 29(3), 459-478.

Hogg, M. A., Martin, R., Epitropaki, O., Mankad, A., Svensson, A., & Weeden, K. (2005). Effective leadership in salient groups: Revisiting leader-member exchange theory from the perspective of the social identity theory of leadership. Personality and Social Psychology Bulletin, 31(7), 991-1004.

Northouse, P.G. (2016). Leadership: Theory and practice. 7th ed. Thousand Oaks, CA: SAGE Publications.