People can be suspicious of theory and you’ll often hear them say, “that’s all very well in theory, but does it work in practice?” Skepticism abounds and not least in the field of management and leadership, because it is so cluttered with various theories, from Charismatic Leadership, to Transformational Leadership, Authentic Leadership, and so on – and all competing for the busy manager’s attention.

Despite the number and complexity of the various theories, practicing managers often have fairly simple real-world problems that they need to be solved. And the test of a theory, at least as far as a manager is concerned, is how well it translates into practice and helps them resolve those problems. Top of that list of concerns is often: how do I get the best from all my team members? One of the more recent theories to address this particular issue is the Leader-Member Exchange theory, which is a bit of a mouthful and is more usually abbreviated to LMX. At its most basic, the theory suggests that not everyone on your team is the same and, therefore, treating them the same is not going to get the best from each and everyone of them: some will excel without supervision, others need constant encouragement or attention.

Emerging as a theory in the 1970s, LMX takes this basic assumption of differences between team members and then focuses on the development of the relationship between them as individuals and the manager.

LMX theory views that leader-team member relationship as developing through three distinct phases:

Role-Taking – Roles are initially assumed as individual skills, abilities and levels of trustworthiness become apparent.

Role-Making – As the team develops, the manager expects members to work hard and contribute and be trustworthy members of the team. The manager, however, whether consciously or unconsciously, starts to differentiate between the In-group and the Out-Group. That is, those who are capable and trustworthy, the In-Group, and those who lack competence or motivation, the Out-group.

Routinization – A routine develops, with In-Group members being developed and trusted by the manager and Out-Group often stagnating as the relationship degenerates into dislike and distrust.

Once routinization has set it, then the fate of team member has often been sealed and it is difficult to break that perception. In-Group members may receive greater levels of trust and promotion and Out-Group members either become problematic and unmotivated or eventually depart somewhere else.

So far, so good and as a practicing manager you may already see some relevance to your own situation and your team. The problem that we face is that once routinization becomes embedded in our thinking – and it happens quite quickly – it takes a lot to change those perceptions, just like it does when we meet someone for the first time and form first impressions about them. But what this means is that we are not getting the best performance out of all of our team.
Here’s what LMX theory recommends you to do:

Who is ‘in’ and who is ‘out’? Most importantly, you want to concentrate upon the Out-Group members: why are they on that list? Was it a breach of trust? Or do they lack certain skills? Or are they just demotivated?

Having identified the groups you can start to re-establish the relationships. The emphasis is on the Out-Group, so meet with them on a one-to-one basis and keep up the dialogue. What are their hopes and goals? What motivates them: responsibility, recognition, the possibility of promotion? You are not going to be be able to reassess and rebuild that relationship, unless you are able to move beyond that initial prejudgement of them.

Having now reconnected at an individual level, we can now set about rebuilding those relationships and enabling each one to fully contribute to driving team performance.

Whilst the fundamentals of LMX theory are not rocket science, it does provide a relevant warning to managers that you may have made early judgements about your team and the hardest thing is going to be about how you reassess and rebuild that relationship, rather than let it sour and effect performance.

Whilst some members may never be deserving of trust, and they’d need to be dealt with accordingly, a good leader should be able to deliver and encourage performance from all the members of a team and not just a select few. LMX theory is all about encouraging the practicing manager to do just that.