Leader-Member Exchange

The leader-member exchange theory (Graen, 1969) proposes that the type of relationship leaders have with their followers within an organization is the key to determining how leaders influence their employees. In a high-quality leader-member exchange, the leader forms trust with their employees and each helps the other. There is mutual respect for the leader and the members, and either would go above and beyond their required jobs to create a successful team and work result. In a low leader-member exchange, there is a lack of trust and respect between the leader and the members. In this relationship, members perform their jobs and the leader provides rewards or punishments. There is no loyalty or obligation in this relationship.

Factors that contribute to the development of high-quality leader-member exchange include the leader treating the followers fairly and delegating responsibility (Campbell, 2020). The effort put into creating a good relationship and personalities being similar between the leader and member can make a difference. If the leader and member like each other, there is a better chance for high leader-member exchange.A strong leader-member exchange can have positive impacts on the leader and employees. High leader-member exchange can lead to high job satisfaction, organizational commitment, and strong job performance from employees. There is also less turnover in a high leader-member exchange and higher performance ratings with fewer stressors on the job (Ciranoglu, 2022).

Many types of relationships can form in groups. Members can have a good relationship with the leader as well as people who might feel removed from the rest of the group. This creates an in-group and out-group within the same workgroup. Members who engage in high-member-leadership exchange practices tend to form the in-group. They experience high job satisfaction and may receive help and more contact with their leader, thereby creating a relationship and stronger connection to the leader. These members tend to perform well, and they are more likely to demonstrate high levels of citizenship behavior due to their higher job and leader satisfaction. Unfortunately, the opposite would happen for members of the out-group who do not experience similar support from the leader.

To develop this high leader-member exchange, a leader should build trust with their members by demonstrating fairness and treating employees well. Employees can contribute to high leader-member exchange by being engaged in their job and seeking feedback and additional responsibilities (Campbell, 2020). Members can also engage in sincere flattery which increases the connection with the leader. High-performance members, however, do not necessarily enjoy a high leader-member exchange, rather that is based on relationships and interpersonal communication.

Leader-member exchange theory suggests that one way to influence employees is by building relationships. Most relationships at work develop naturally because of the close contact and amount of time spent together, but there is also a power in having these naturally occurring relationships for both the leader and the employee. For the leader, these relationships result in a stronger bond with the employee and better morale for the team. For the follower, these relationships can result in higher productivity and lower turnover. As a leader, it is important to pay attention to the relationships within the workgroup and how these relationships may affect overall job satisfaction and performance.

Leadership happens in different ways and not all types of leaders work effectively within all organizations. The type of leadership might be determined by the leader-member relationship, the task, and the leader’s power. Finding the leadership style that best fits the situation and the personality of the leader can mean success for the organization, the leader, and the employees. There is no particular style that is better, but the leader and the situation must fit well together. The success of the leader depends on the leadership style and the type of leadership that is used. If everything works well, a leader can bring valuable benefits to an organization.