Leader engagement and employee output
SOMETIME around the 1980s, scholars began exploring the emotional and symbolic aspects of leadership. Studies sought to understand how followers (employees), were influenced by their leaders to pursue the interest of the organisation above personal interest. The Leader-Member Exchange (LMX) theory considers the relevance of the relationship that is formed and maintained between the leader and employees. Also how certain personality traits of leaders can facilitate a high quality relationship and contribute to increased productivity and performance of subordinates and positively impact the organisation’s bottom-line.
Business owners and leaders will agree that managing a business today is much different than managing a business 15 years ago. Markets continue to change, customers’ needs continue to evolve, technology continues to force companies to find innovative ways to serve customers. Furthermore, in highly competitive markets, leaders need all the help from all stakeholders including, and, especially employees to succeed. Gone are the days when people employed in organisations were seen as workers in a purely transactional relationship. Employees are considered a critical component of organisational performance. When employees are given tasks to perform, they do not always comply, sometimes, they reject and ask for new tasks or may do it half-heartedly. Having employees on the team who are committed, open and willing to go above and beyond expectations are what every leader wants.
The Leader-member exchange (LMX) theory describes a process between the leader and his followers (employees) where a high quality relationship is formed based on shared information, two-way communication, respect, commitment and frequent interactions. This relationship between the leader and employees results in job engagement of employees. Consequently, employees put in greater efforts to get their work done, are committed to the organisation’s goals and go above and beyond what is expected of them. Their productivity increases and so does the performance of the organisation. Leaders’ expectations of those employees are high and usually, they surpass the leader’s expectations. These employees are considered as advisors or in-group.
The Pygmalion Theory argues that leaders get out of their employees what they expect. If leaders expect a certain employee to be a star employee, he/ she will be treated as such by the leader and will be inclined to perform exceptionally.
According to the LMX Theory, the quality of the relationship between the leader and employees is determined by the leader’s perception of the employees. If the leader perceives that an employee is intelligent and competent, takes initiative and is proactive, the leader will be inclined to initiate a high quality relationship with that employee.
Where a leader perceives that the subordinate may be incompetent, this will impact the leader-member exchange. Employees with a low quality relationship with their leader will have less interactions with the leader. They will not be privy to certain information, and there will be little mutual respect. In such relationships, employees are most likely disengaged. They may not share the leader’s vision for the organisation and may be unwilling to perform above what is expected of them.
These behaviours by employees further impact the leader’s perception of them and they form part of the “out-group”. They are considered of lesser importance than the in-group and experience fewer favours and privileges.
The LMX theory argues that there are certain leadership personality traits that facilitates high quality LMX. Because LMX is a social exchange process, the charismatic and transformational leadership traits are considered key to a high quality leader-member relationship. The basis for developing high quality interactions with employees is for the leader to dictate the desired outcomes to employees. This could be communicating the vision and mission of the organisation to employees and influencing their behaviour to the extent where they self-sacrifice their desires for the overall interest of the organisation.
Although charismatic and transformational leadership are often used interchangeable there are certain distinct features of both traits. Shamir & Howell,2018 describes Charismatic leadership as a quality of converting the vision into reality. They argue that the main characteristics of a charismatic leader are a strong personality, attractive communication skills, and the ability to easily convince others. On the other hand, Anderson, 2017 describes Transformational leadership as the ability of a leader to inspire and motivate their followers (employees) to achieve a particular goal. Leaders are able to motivate employees to impose extra efforts to show support to their leader. Transformational leaders have the ability to provide reassurance, and solutions to employees, especially in crisis situations.
Generally, transformational leaders are creative and intellectual.
Join us next week as we look at how transformational leaders use this leadership trait to improve employees’ performance and the consequence of that to the organisation.
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