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LMX Outcomes

Introduction

Functional leaders are interested in getting others to do work to help meet the leader’s organizational goals. Leader-member exchange (LMX) relationships describe the working relationship a team leader and a team member have developed. Described in the literature as the social exchange relationship between a leader and a member (i.e. boss-worker, supervisor-supervisee, etc.). This relationship is scored by various instruments (e.g. LMX-7, LMX-MDM) from low quality through high quality. Quality of the LMX relationship has been shown to be associated with a significant body of outcomes. The LMX relationship is important to how the work gets done and is described here as teamwork. The outcomes do not always specifically and directly associate with outcomes and some outcomes may not met leader goals. Some of the outcomes may indirectly help achieve goals while others seemingly have nothing to do with goal achievement. Leadership studies identify four major categories of outcomes of the LMX relationship: behavioral, attitudinal, role states, and perceptual. The following discusses recent research regarding each category, provides constructs associated with the category, and identifies whether the construct is positively or negatively related to follower perception of the quality of LMX in their dyad as identified in current studies.

Recent Research on Outcomes

Behavioral Outcomes

Behavioral outcomes are characterized by activities associated with the teamwork related to achieving the goal. In other words, LMX quality is related to observable actions by the team member of the dyad. Positively related outcomes include job performance and organizational citizenship behavior (OCB).

Job performance. Job performance is the measured results of the activities associated with teamwork including intermediate activities, the results of the intermediate activities, and the end results of all activities.

This performance relates to in-role performance, the results of the duties in the member’s job description. OCB is a construct describing the “going above and beyond” member activities. For example, members voluntarily do extra tasks that a leader needs completing. These tasks are not always associated with the member’s own work product, but may enhance the leader’s full team results. Evolving work environments have left the boundaries unclear between required activities (behaviors) and voluntary additional activities (behaviors).

Job Performance. Studies utilizing in-role job performance as a variable either measured performance as part of the study or used existing performance data.

This is consistent with previous work as seen in a meta-analytic review reported in 1997 (Gerstner & Day) with performance measures derived from records, both subjective supervisor ratings and objective output reports, as well as contemporaneous subjective and objective ratings. Deery, Rayton, Walsh & Kinnie (2017) matched company records for performance to the individual team members participating in the surveys that elicited variable data such as OCB. Deery, et al. did not reveal what performance measures were obtained. This study also did not relate results directly to LMX, but did relate to OCB which does associate positively with LMX so inferences can be made as to the performance reported and possible LMX quality.

A scale developed in 1991 (Williams & Anderson) was used as a contemporaneous subjective supervisor perception measure of performance. “A sample item is ‘He (or she) adequately completes assigned duties.’” (Kim & Park, 2015, p. 1706). LMX quality was measured using member perceived LMX-7 (Graen & Scandura, 1987; Graen & Uhl-Bien, 1995; Scandura & Graen, 1984). In-role performance correlated positively with LMX quality (0.46, p < .01) (and positively with job satisfaction, affective commitment, transactional leadership while negatively correlated with emotional exhaustion, if of interest).

Organizational citizenship behavior. Organizational Citizenship Behaviors (OCB) describes the “going above and beyond” activities.

Members voluntarily do extra tasks that a leader needs completing. These tasks are not generally associated with the member’s in-role work product, but may enhance the leader’s full team results. Evolving work environments have left the boundaries unclear between required activities (in-role) and voluntary additional activities (OCB).

A recent literature review regarding OCB defined the construct as “anything employees choose to do, spontaneously and of their own accord, which often lies outside of their specified contractual obligations” (Azmi, Desai & Jayakrishnan, 2016, p. 104). While this definition gets to the heart of the behaviors, this literature review also suggests that leaders might provide impetus and direction for the “spontaneous” voluntarism behavior as described in Podsakoff, Whiting, Podsakoff and Mishra (2011). While OCB might appear in its voluntary nature to be all to the good, these extra-role behaviors can come with personal costs including emotional exhaustions and family conflict (Deery et al., 2017). Deery et al. (2017) measured OCB using the measure developed by Podsakoff, MacKenzie, Moorman & Fetter (1990) that has 25 questions with five questions each for five subscales of altruism, conscientiousness, sportsmanship, courtesy, and civic virtue. Regression analysis associated the time-consuming OCB subscales of altruism and conscientiousness positively with the negative outcomes of emotional exhaustion and family conflict. The outcome of job performance was positively associated with all OCB subscales and was not related to the negative outcomes. The researchers posit that members exhibiting high OCB become over-worked by their own voluntarism and their leaders’ adding work to those they believe will accomplish the tasks, likely, though not shown in this study, due to high quality LMX relationships. One study showed only a 0.19 correlation between LMX and OCB (Newman, Schwarz, Cooper & Sendjaya, 2017), but a more significant result was the finding of the mediation by LMX of leadership style on OCB. LMX accounted for 90% of the correlation between OCB and Servant Leadership. Another study found LMX related to OCB at 0.70 and significant mediation by LMX of both Benevolent Leadership and Moral Leadership (Tang & Naumann, 2015). These findings of mediation support the supposition that LMX quality is important in OCB formation and maintenance even if to the detriment of the member.

Actual turnover. A negative outcome of low quality LMX is a member leaving their current employment.

This can be voluntary or involuntary, temporarily or permanently, temporarily may have been expected to be permanent, but the member “boomerangs” and returns voluntarily. Some studies include a major change of position in a company as turnover, some require full separation from the organization, depending on what is being studied (DeConinck, DeConinck & Banerjee, 2013; Gerstner & David, 1997). While various constructs have been studied or proposed as antecedents to turnover, LMX quality as an antecedent has a direct association (Deconinck, 2011) and has been proposed as central to understanding other constructs affecting turnover by including LMX as a studied mediating variable (Jutras & Mathieu, 2016).

Turnover intention. Turnover intention should not be confused with turnover as it describes the activities a member engages in that are related to the behavioral intention to voluntarily terminate employment.

This construct is described as high intention (high VTI) or low intention (low VTI). A member with high VTI engages in activities such as interviewing with a competitor. Lower level of VTI may exhibit in behaviors such as asking friends what it is like working where they work. Very low levels of VTI for a member is associated with being satisfied that they will not be leaving their job voluntarily any time soon and very few turnover behaviors are exhibited. Turnover intention is used as a proxy construct for actual turnover even if not explicitly stated (Malik, Wan, Ahmad, Naseem & Rehman, 2015).

LMX quality as a measure of the “goodness” of the relationship a member has with their leader can easily be inferred to lower VTI. This inference is supported by recent work: a) Adil and Awais (2016) (-0.251 , p=0.002); b) Chen, Wen, Peng and Liu (2016) (-0.30, p<0.001); c) Furunes, Mykletun, Einarsen & Glasø (2015) (-0.44, p<0.01); d) Kwak and Choi (2015) (-0.35, p<0.01). Job security is also negatively related to VTI (-0.30, p<0.01) (Wang, Liu, Luo, Ma & Liu, 2016).

Attitudinal Outcomes

Attitudinal outcomes are closely related to behavioral outcomes in that very often an attitudinal outcome is the psychological mirror reflecting a behavior. These outcomes are measured with psychological instruments rather than how behaviors are explicitly observable.

Job satisfaction. Job satisfaction measures the match between an employee’s expectations about their job versus their perception of the reality.

The implication is if the job is meeting expectations then that is satisfaction. For example, the Minnesota Satisfaction Questionnaire (MSQ) (Vocational Psychology Research University of Minnesota, 1977) has questions regarding twenty areas such as ability utilization, achievement, compensation, and co-workers asking the degree of satisfaction. Malik et al. (2015) used the short from of the MSQ and LMX-7 (Graen & Uhl-Bien, 1995) finding a strong positive relationship between job satisfaction and LMX quality (0.911, p<0.001). Saifi and Shahzad (2017) used the three-question job satisfaction instrument developed in 1983 (Cammann, Fichman, Jenkins & Klesh, 1983) to compare with Organizational Justice and OCB. A 1951 scale ((Brayfield & Rothe, 1951) was used in a 2017 study to compare job satisfaction with individualized consideration (IC) finding a weak correlation (0.28, p<0.01) (Malik, Javed & Hassan, 2017).  IC from transformational leadership theory encompasses much of the characteristics of LMX quality along with idealized influence (Zacher, Pearce, Rooney & Mckenna, 2014).

Organizational commitment. Organizational commitment (OC) refers to three different dimensions of reasons why a member stays with their organization.

The three dimensions of OCB are namely affective, continuance, and normative. These refer to in order, a member liking their organization, a member needing to stay, and staying because they feel compelled by opinions of others (Allen & Meyer, 1990). A recent study by Malik et al. (2017) measured OC with the instrument developed in 1997 and reported in 1999 (Meyer, Allen & Sulsky, 1999). This instrument was not used to report on the three dimensions separately only to provide an overall score for OC. OC was found to have a weak positive relationship with IC (0.174, p<0.05) and II (0.266, p<0.05) from transformational leadership implying the possibility that OC would also have a low positive correlation with LMX quality in their study had that construct been included. Kim and Park (2015) employed LMX-7 (Graen & Scandura, 1987) and Allen and Meyer’s (1990) instrument to measure the affective commitment dimension of OC finding a positive correlation (0.27, p<0.01).

Role States

Role states describe the member’s perception of how they fit in the organization and with their leader. Two constructs studied are role ambiguity and role conflict and collectively they are called role stressors (Bowling, Khazon, Alarcon, Blackmore, Bragg, Hoepf, and Li, 2017).

Role ambiguity. Role ambiguity describes the member’s perception of their understanding of what is expected of them by their leader, what the rules are, the rights they have, and how to get their work done.

Bowling et al. (2017) developed a new scale, six items of which described role ambiguity to obtain member perceptions of their work role clarity-ambiguity. The stress placed on a member by the ambiguity relates positively to negative physical outcomes and withdrawal behavior and negatively to satisfaction. Using a 1970 instrument (Rizzo, House, &Lirtzman, 1970), intention to stay (a construct similar to VTI) correlated negatively with role ambiguity (-0.93, p<.01) (Chen, Rasdi, Ismail & Asmuni, 2017), a result that could imply LMX negatively related to role ambiguity as found by earlier studies (-0.47, p<0.01) (Dunegan, Uhl-Bien & Duchon, 2002).

Role conflict. Two or more sets of expectations for a member regarding their work can create a conflicting role state for the member.

Role conflict creates member stress due to work overload and challenges brought about by boundary spanning that comes with more than one supervisor, working in multiple departments, and differing sets of co-workers and outsiders involved in their work (Bowling et al., 2017). This stress can lead to dysfunction such as members quitting as role conflict is negatively related to intention to stay (-0.487, p<0.001). LMX is also negatively related to role conflict (0.39, p<0.01) (Furunes et al., 2015).

Perceptual Outcomes

It is important for leaders to be aware of how members think of the organization. This includes how the member perceives the fairness of the workplace, that there is equality in work and reward, if there is member empowerment, and the level of office politics.

Organizational justice. Organizational justice (OJ) is the member’s perception of how fair they and others in the organization are treated in terms of fairness in work rules, sharing equally in costs and rewards at work, and fairness in how decisions are made. In order, these are namely procedural justice, distributive justice, and interactional justice (Govender, Grobler & Joubert, 2015).

OJ is related to LMX as both relate to member perception of their work environment such as job engagement (JE). JE is a measure of the attitudes and behaviors a member exhibits ranging from low engagement (low vigor and low contribution) to high engagement (liveliness and focused work-effort) (Sharoni, Shkoler & Tziner, 2015). Sharoni et al. (2015) found positive relationships between JE and both LMX (0.19, p<0.05) and OJ (0.21, p<0.05). The study also found transformational leadership (TL) to moderate the relationship between LMX and JE so that high levels of TL resulted in higher LMX to JE correlation (0.28, p<0.01) and low levels showing a non-significant correlation.

Summary

Outcomes can be what matters most in an organization. Business administrators are interested in production, human resource directors are concerned with attitudes and behaviors, and members themselves are keenly aware of how they perceive their organization. Leaders must consider all of these dimensions of their organizations. Paying attention to the quality of LMX relations between leaders and each of their members by the leader themselves as well as by organizational staff and by team members is a currently researched key to achieving desired organizational and personal outcomes.


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