Leader Member Exchange Theory

I had the privilege of teaching a class today on Leader-Member-Exchange theory, drawing heavily from Peter Northhouse’s, Leadership: Theory and Practice. The basic concept for the class follows:

QUESTION:  What is LMX Theory?  What makes it unique compared to other theories in the course?

Notes: Initially this was a descriptive theory, describing what was happening in organizations.  Leaders have unique relationships with each of their subordinates. The theory is focused on the interactions between leaders and led and introduces “leadership” from a relational perspective. Researchers found that employees could be generally categorized into two groups: the “in” and the “out” group, where the in group employees had a relationship with the leader that went beyond the formal role relationship.  These employees receive extra influence, opportunities, and rewards.  The out-group employees did what was expected based on their formal role descriptions, and they received standard job benefits.

QUESTION: What does this mean from the “subordinate’s” perspective?  From the “Leader’s” perspective?

Imagine that I am the boss and all of you are sales reps that work for me.  You just went to a training program where you learned all about LMX.  The veil has been lifted, and you are back at work.  How is this new knowledge changing the way you see things?  What are you looking for? What are you thinking about?

Forget the above scenario.  You are the boss and YOU just went on that biz training program and learned all there is to know about LMX. The veil has been lifted.  What do you do with your new knowledge?  As you return to work, what are you looking for?  What are you thinking about?

I then read from Made to Stick, a book by Chip and Dan Heath — (p. 111-113) the part where they relay the famous “blue eye, brown eye” experiment in which students were grouped and discriminated against based on their eye color. [read about it]

I related two other research examples, one of which was the “Pygmalion Effect” work done by Robert Rosenthal and Lenore Jacobson in the 1960s whereby they labeled students as “poised for intellectual growth this year.”  Those randomly chosen students thought they were “smart” and so did their teachers.  It had an effect on what they learned and how they did in school.  It created a self-fulfilling prophecy.

QUESTION: How does this knowledge connect to what we are talking about with LMX?

QUESTION: What has the LMX research shown about the benefits of being in the “in group” or being in an organization that is characterized by high-quality leader-member exchanges?  …for the employees?  …for the organization?

Notes: Less employee turnover, greater organizational commitment, more promotions. Employees feel better, accomplish more, are more dependable, communicative, involved, have more energy, and are even more creative.  They have more access to the boss and information, receive preferential treatment, better feedback, etc.

QUESTION: Can you imagine a person who might not want to be in the “in group” for whatever reason?  Notes: e.g., someone that is not in a position due to family or other constraints to give of themselves so much or to take on the additional roles and commitment that being in the “in group” entails.  Perhaps an employee seeks meaning outside of the “day job” and is perfectly satisfied sticking to the formal role. 

QUESTION: With that type of individual aside…Given this research, does it make sense to take a prescriptive approach — and to seek to expand the “in group” as much as possible? IOW, should our goal be to move everyone into the “in group”?  Is that even possible?

QUESTION: Describe what a high quality leader-member exchange (aka, a really positive leader/subordinate relationship) looks like in action?  Describe the kind of relationship you think would be really effective for leaders and their employees to have.


QUESTION:
What is “leadership making” according to LMX Theory?  How do you set the conditions for more employees to move from the “out” to the “in” group — or from the periphery to the core, where the core is a place of deeper engagement, meaning, commitment, and identity?

Notes: Moving from being a “Stranger” to being an “Acquaintance” to creating a “Mature Partnership.”  Leadership making is an intentional focus on developing high-trust, mutually beneficial relationships with ones employees (and seeing each relationship as unique).  Interactions between the leader and the led are characterized by mutual trust, respect, and commitment/obligation.  In the process, the goals of the leader, followers, and the organization are all advanced.

CONTINUE TO THINK ABOUT: How do leaders create (or at least set the conditions for) high-quality relationships with their Soldiers (or employees)?

Personal Reflection: LMX elevates the importance of the relationship between the leader and the led.  It suggests, or leads one to believe, that the main source of meaning and commitment at work is driven by the relationship with the boss. What does that mean for those unlucky enough to be stuck with a horrible boss?  What is missing with this strict focus on the leader and the led?  For one, it leaves out the “mission” or “purpose” of the organization as well as the meaning and impact of peer-to-peer relationships.  A missing component is how much you believe in the purpose of the organization and the people that you work with.

I’m seeing a connection between LMX and some of my own work with core-group theory and the process whereby members of an informal community (or voluntary organization) move from the periphery to the core as far as their engagement and participation.  The “in-group out-group” aspect of LMX is a different model for looking at movement from the periphery to the core.  I like the focus of LMX on interactions between leaders and employees or “potential leaders.”  The idea of “Leadership Making” is connected to this and to leader development more broadly.  I’d like to read more about that topic.

I really enjoyed diving into this today!

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