Leading Strategic Decision Making: Analysing Leader-Member Exchange Theory and Factors for Maintaining High-Quality Relationships in Contemporary Organizations

This report discusses the importance of leading strategic decision-making in contemporary organizations and how the leader-member exchange theory can help maintain healthy relationships between employees and leaders. It also highlights factors that contribute to high-quality relationships and provides recommendations for improving job satisfaction and enhancing organizational culture.

HRM11120 Leading
Strategic Decision
Making.

Table of content
.........................................................................................................................................................1
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Analysing of the relevance of the leader-member exchange (LMX) theory in the contemporary
organization:................................................................................................................................3
Factors that contribute maintaining high quality relationship between employees and leaders..4
Recommendations:.......................................................................................................................7
CONCLUSION................................................................................................................................7
REFERENCES................................................................................................................................1

INTRODUCTION
Leading strategic decision-making is the process to understand about the interaction of decisions
and the impact given by them on the growth of the organization. The strategic decisions play a
vital role for the growth of the organization by giving a competitive advantage over the edge of
the company and this decision-making helps by providing the change in the complete scope of
the organization and also help the company by providing and changing the best direction for the
company's future growth Mughal, & Kamal, (Eds.).(2018) Strategic decision-making is the
basic of charting the future goals on the long term basis and with the long term vision. A
manager by clearing the areas of consent framing the big aims for the company's future growth
have an opportunity to deal comfortably with the short term growth plans of the company that
gives the idea for the future operations consistency and clarity. The further report based on the
leading strategic decision-making will be highlighting the leader members exchange (LMX)
theory by showing how the healthy relationship is being maintained by the organization,
managers and the leaders with their employees Umrani, Kura, & Ahmed, (2018). The report
will be also showing about the relationships and working culture of the organization with
employees like subordinates, supervisors relationship is maintained by high quality working
relationships by using the various factors to illustrate the following in the context of the
contemporary organization. In the report further recommendations will be given for the practice
for the development of the organization and in with the work place with the different employee
Secundo, and et,al., (2021).
MAIN BODY
Analysing of the relevance of the leader-member exchange (LMX) theory in the contemporary
organization:
Leader-member exchange theory is that through which the followers and leaders in the
organization suggests how unique relationships based on the social exchanges, and how
employees get influenced by the quality of these exchanges in organization and the way they
provide with the best possible outcomes Dotson, (2021). The leader-member exchange theory
works with its different elements that consists of role-making, role-taking and routinization.
Analysation of the theory in context of contemporary organization is stated as:
Role-taking: the time when new joiners come in the groups and join it, and how the managers
utilize this time for the assessment of the new members by increasing their abilities and skills.

Role-making: by the time new members joins the group, and they start to work in the
organization, the leader focus on their upliftment on two basis:
In-group: once the new-members are trustworthy and are proven loyal towards the work the
organization, the leader divide them in the groups on which the manager gives more of his
attention towards development
Out-group: if the group member breaks the ethics and the trust in the group the one is
Outside the group and that individual doesn't have much of the managers attention and
Does not receive future opportunity.
Routines: once the groups are classified and the individuals are divided accordingly, the leader
comes up with the new ideas to be established in the groups and the people working in it comes
up with the best advancement as compared to the out the group peoples.
For example: the way Elon musk in the tesla took over the role of the CEO and how he
divides the roles into the subordinates according to their capabilities to work in the different
tasks and roles. In the further operations the individuals assigned by the Musk divided the tasks
into colleagues and how they perform them under the guidance of their managers and by
managing the things on time. Whole process is followed by the Tesla and the best possible
outcome is given in the form of the cars to public by satisfying their needs and wants.
Factors that contribute maintaining high quality relationship between employees and leaders.
There are various factors that contribute to manage effective leadership between the leaders and
their subordinates-
Recognition and the respect- The respectful leader is the one that gives respect to others and
take respect from the others. It is leader's duty to make employees feel valued and respected all
the time while working in the organization because their attitude towards organizational goal
matters and without this leader will drive away the people that he is trying to lead in the
organization Fu, and et.al., (2020) . When any employees feel respected, they feel motivated
and their efficiency to work towards organizational goal increases said in the LMX theory.
However, making respectful relationship with employees is not enough they must be recognized
from time to time for the work that the employee is doing, and this recognition boost employee
engagement in the organization. The great way to show appreciation to the employees is by
assigning them high profile projects as a gesture that leaders are confident about the abilities and
the talents they possess . There are some another ways also that has been followed by companies

like Tesco that offers colleagues discounts, buy as you earn and save as you earn schemes and
financial well-being hub for the employees working in the organization. This help employees to
feel part of the organization and value his job.
Effective communication- This is another important factor that helps in boosting an individual
performance in the organization Effective communication by the leaders is not only related with
proper sending and the receiving of the message Fabricius, (2020). . It also includes when any
leader should talk and should listen to its employees and subordinates. This involves sharing of
ideas, opinion, feedbacks and constant engaging in the conversations with the employees. The
different type of communication process involves verbal communication, non-verbal
communication, written communication etc. There are time when employees don't have clear
ideas, vision and information of the company which is very important for achieving any
organization goals and this can only be achieved by the effective communication process.
Effective communication helps both employer and employee in building trust, improving
teamwork and problem solving attitude in employees Chatzi and et.al., (2019). . The LMX
theory says the that without effective communication no organization can run successfully and
will result in unnecessary conflicts and negative attitude in the minds of the employees. For
example letters, phone calls and e-mails are methods of communication used by the Unilever
PLC. The written communication by the leaders help employees in getting clear idea about the
information that has been provided to them.
Trust and collaboration- Leaders are responsible to maintain trust among the workers in the
organization. The transformational leaders work in team to get initiative from different
employees and encourage communication process . the LMX theory says that Rather, then
working on individual level, team work and collaborations helps in achieving the organizational
goal as soon as possible. It also helps in building trust among employees and the leaders in
teamwork shows the ability to work with group in order to attain the same group objectives.
Collaboration if leaded in positive way always helps to enhance the productivity of the
organization, boost the effectiveness of the employees working and also increases the efficiency
at the organization. Not only this working in team helps employees in his personal growth,
increases his job satisfaction at workplace and decrease stress level of an individual The team
work is responsible in building the good reputation of the organization like the company Tesco
has different teams to work the marketing, commercial, finance and the IT team which helps

them in increasing staff motivation by taking their different initiatives and working towards them
Wen, Huang, & Hou, (2019).
Honesty and the development- Honesty in employees and labours both help in individual
development. Different training programmes provided by the leaders helps employees in
personal growth and the development. Personal and professional development is a way to
increase skill and the abilities of the individual by giving their maximum potential. The honesty
by the worker help leaders in providing development process . Leaders and the superiors in the
organization are responsible to held training time to time. It also helps an individual to grow on
individual basis and increase his efficiency for working towards organizational goals. This can
also be describes as the planned intervention by the leaders specially deigned to boost employees
performance in the organization Zhao, Zhang, & Xu, (2019). Training is also related in
building the culture, safe environment and fair inclusion of all the employees. The development
process also helps in identifying the capabilities of the individuals, their talents to face
challenges in the organization. Like the company Tesla employees are always encouraged to
work hard for the organization and take necessary training processes at different time. For this
Tesla works in partnership with different experts in need to empower all the employees to work
together and the keeping them closely with the business goals.
Commitment- There is an important relationship between the commitment and the job
performance of an employee. Job satisfaction is the responsibility of the leaders that manage
direct relationship with the employees at lower levels Judge This relates the happiness and the
commitment of the employees that they feel and commit while working in the organization
which is generally achieved by having good communicating with them. These factor is important
to manage in the organization as ensuring this will result in achieving organizational goal as soon
as possible. At the same time job satisfaction also counts the work and personal life balance. The
another important thing in job satisfaction is related with the positive state of the employees and
their experiences in job. Leaders who are effective in managing team and has good leadership
quality in minimizing politics is the organization and ties their best in increasing job satisfaction
of the workers. Companies like Tesla, Unilever has action-oriented leaders which tried their best
in increasing job satisfaction of the worker and the style of managing team is always centred
around meeting the organizational goals efficiently and effectively. Therefore, the leadership and

the politics of the organization both are equally important for managing employee's satisfaction
regarding the job.
Balanced organizational culture: the term balanced organizational culture means that
employees working in the organization feel safe in the psychological means and the physical
means. The employees in the organization feel free to express their ideas, and feeling in the part
of the culture related to the organization. Organizational culture on the balanced growth have
various characteristics that consists of the innovation in the workplace, attention towards the
detailed work, and emphasis on the best possible outcomes . An ideal organizational culture
focus on the employees and their customers. The organization develops with it culture in the way
it finds the ways to fulfil the needs of their consumers on the continuous basis and with the
emerging demands and changing taste preferences by also maintaining the company's values and
the ethics to cover up the market. The various types of the organizational cultures like
empowered culture, innovative culture, sales culture, culture of safety, customer-centric culture,
etc. can be adopted by the organization to get developed.
Recommendations:
In order to enhance the job satisfaction of the existing employees within the organization are as
follows:
The way job satisfaction in the organization for the employees can be improved by adopting the
various strategies like being flexible in the organization, allowing the employees to shape their
respective roles in the organization, by stopping the micro-management, recognizing their efforts
in the organization and rewarding them as per their achievements, by promoting their good
health The job satisfaction in the employees can also be developed by the looking after the work
environment in the workplace and by improving the house-keeping issues Judge, Zhang, &
Glerum, (2020).
CONCLUSION
The above report about the leadership management and the leading strategic decision-making
have concluded about the ways in which the leader-member theory can help in the development
of the organization and how the healthy and comfortable relationship is maintained in between
the employees and the higher authorities of the organization . The above report have also showed
about the various ways by which the organization can maintain good and healthy relationship in
the organization by adopting them. Report also shows about how the three different elements of

the leader-member exchange (LMX) theory influence the functioning of the workplace by giving
different roles from higher authorities to the colleagues. Recommendations are also given in the
report to improve the job satisfaction factor of the organization towards their existing employees.

REFERENCES
Books and Journals
Fabricius, M. (2020). Internal Communication from the Employee Perspective: A Case
Study for a Scale-Up Organization.
Chatzi, A. V., and et.al., (2019). The unexplored link between communication and trust
in aviation maintenance practice. Aerospace.6(6), 66.
Zhao, H., Zhang, H., & Xu, Y. (2019). How social face consciousness influences corrupt
intention: Examining the effects of Honesty–Humility and moral disengagement.
The Journal of social psychology.159(4), 443-458.
Umrani, W. A., Kura, K. M., & Ahmed, U. (2018). Corporate entrepreneurship and
business performance: The moderating role of organizational culture in selected
banks in Pakistan. PSU Research Review.
Fu, B., and et.al., (2020). Sensing technology for human activity recognition: A
comprehensive survey. IEEE Access.8, 83791-83820.
Mughal, Y. H., & Kamal, S. (Eds.). (2018). Servant leadership styles and strategic
decision making. IGI Global.
Secundo, G., and et,al., (2021). Strategic decision making in project management: a
knowledge visualization framework. Management Decision.
Judge, T. A., Zhang, S. C., & Glerum, D. R. (2020). Job satisfaction. Essentials of job
attitudes and other workplace psychological constructs, 207-241.
Wen, J., Huang, S. S., & Hou, P. (2019). Emotional intelligence, emotional labor,
perceived organizational support, and job satisfaction: A moderated mediation
model. International Journal of Hospitality Management.81, 120-130.
Dotson, M. D. (2021). Correlation between Leader-Member Exchange, Employee Trust,
and Commitment in a Hybrid Organization (Doctoral dissertation, Grand Canyon
University).
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