Leader-Member Exchange Theory vs. Servant Leadership Analysis

This essay provides an in-depth analysis of the leader-member exchange (LMX) theory and contrasts it with servant leadership, examining their applications and impacts within organizations. The LMX theory emphasizes the development of manager-employee relationships to enhance knowledge and resource access, fostering employee productivity through valued relationships. The essay discusses how LMX influences different types of employees, such as task-performing and organizational citizen behavior employees, by creating reciprocal relationships and social exchanges that improve task performance and organizational culture. Furthermore, the reflection on servant leadership highlights a power-sharing model that prioritizes the needs of team members and collective decision-making, promoting employee growth, psychological well-being, and participation in organizational processes. The essay also addresses the challenges of balancing organizational needs with employee needs in servant leadership and suggests integrating aspects of LMX to enhance organizational outcomes. Ultimately, the essay underscores the importance of adapting leadership styles to create a positive and collaborative organizational environment.

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Positive Leader
Student’s Name
University
Date
Instructor
Course

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Positive Leader
Introduction
Arguments on the application of the leader-member exchange theory in Australia stem
from the Karpin 1995 Report that presented the findings of a task force designed to investigate
the quality of leadership in Australian organizations. The report indicated that there were existing
gaps between capabilities and best practices in most sectors in the country. This is because most
Australian firms were applying the traditional strategic approaches for managing the workforce
while failing to acknowledge that the nature of the workplace is changing and thus the need for
management theories to similarly evolve (Karpin 1995, p. 4). The leader-member exchange
theory allows development of manager-employee relationships that lead to increased knowledge
and access to resources that support the kind of job that the employee is engaging in (Bolino &
Turnley 2009, p. 281). This is because employees reciprocate to any positive elements that they
receive from the organization thus improving organizational effectiveness. Therefore, the theory
is based on the way management values the employees as a way of making them more
productive. Thus, the leader-member exchange theory is a new management approach that seeks
to improve management of people in organizations through moving away from the traditional
leadership style and developing approaches that allow exchange between the employee and the
organization.
Table one: servant leadership
An example of a servant leader that I know is Albert Schweitzer who devoted his life in
sacrificing and assisting people through showing the best leadership style that he had.
Characteristics High LMX Low LMX
Leader 1 Mutual trust, respect and Limited trust

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obligation
Leader 2 Better communication
with employees
Poor communication
Leader 3 Well defined jobs that
increase commitment
Poorly defined jobs
The impact of LMX quality on different types of employees
The leadership member exchange theory is based on the leader conveying role
expectations and that meet the needs of employees. The theory is established on the premise that
there is a reciprocal relationship that exists between the leader and the follower thus increasing
the outcomes of role negotiation which define the quality and maturity of the exchange that takes
place in the organization. Wang, Law, Wang & Chen (2005, p. 421) article presents a leader-
member exchange model through a sample of 162 leader-follower dyads in China. This article
presents how leader exchange theory-mediated in the organization, through the task performing
employee, the work engaged or job performing employee and
According to Brunetto, shacklock, Teo & Farr-Whaton (2014, p. 5) the task performing
employee benefits from this theory through the formal authority and allocation standards that
benefit the organization in return to performance. This implies that social exchange is moved to a
higher level obligation. The employee, on the other hand, receives special privileges that enhance
performance in the organization. This means that there is a social exchange between the follower
and the leader as a means of fulfilling the obligations assigned in the task (Breevaart, Bakker,
Demerouti & Heuvel 2015, p. 762). The leader has unique social exchange relationships with the
followers that define the quality of the relationship thus increasing task performance. Task
performance is thus achieved through the relationship formed between the leader and the
employee. Lee, Thomas, Martin & Guillaume (2017, p. 3) adds that the role of the leader is to

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influence intended outcomes in the employee through developing social exchange relationships
that increase task performance. The nature of leadership style that the leader uses is important in
determining the exchanges that take place. This means that through reciprocating in the
relationship, the leader meets the job demands that the task performing employee requires to
perform better. Through resources like information, job autonomy and the opportunity to
participate in the decision-making process. On the other hand, the leader has high expectations
that they derive from the employee through the leader-member exchange relationship.
In addition to that, the organization citizen behavior employee benefits from the leader-
member exchange process by developing relationship obligations that diffuse into the
organization. This means that organizational behavior is developed through the positive
association between the leader and the subordinates inform of an exchange currency that defines
the benefits that the employee receives. The role of the leader is to foster high-order social
exchanges. Further, Yukl & Michel (2006, p. 87) suggests that managerial effectiveness is the
ability of the leader to carry out leadership activities and implement decisions depends on the
tactics that the agent uses. This means that leaders have proactive influences that the use to
manage employees. This means that the leader-member exchange theory involves the role
making process between the leader and follower in a reciprocal relationship of social exchange
that develops as the two interact. This means that the leader seeks to develop control over the
employee thus creating better results for the organization. The outcome of controlled employees
is a positive organizational culture that develops relationships between the leaders the employee
and the organization. According to Story, Youssef, Luthans, Barbuto & Bovaird (2013, p. 2541),
mmotivation theorists argue that the leader social-exchange theory can be used to foster
motivation by creating intrinsic conditions that make the work environment more appealing to

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employees. The outcome is increased employee satisfaction thus leading to better conditions for
employees to thrive in.
Therefore, the role of the leader-member exchange theory in the organization is to
increase collaboration between the two levels of the organization. By applying the strategies of
the theory, leaders create conditions that allow employees to thrive while at the same time
increase collaboration which leads to increased results. This means that collaboration is achieved
when there is increased leader-member exchange relationship that is developed when the
organization provides appropriate resources for the leader to thrive in. thus inspirational appeals
are created in employees which create motivation that determines how employees benefit from
organizational processes (Yukl & Michel 2006, p. 89). The leader creates high sacrifice abilities
in employees that reduce the risk of failure thus delivering more results to the organization as
compared to other models of organization management. This theory has been highly applied in
modern management because it creates good conditions for both the leader and the member in an
exchange relationship that improves the organizational environment. Thus the role of the leader
in such relationships is to influence the desired behavior through organizational culture and
behavior that increases task performance.
Reflection on my leadership style
My leadership style is servant leadership which entails a power-sharing model of
authority that seeks to prioritize the needs of the members and at the same time applying
collective decision-making. This leadership style is based on the need to serve others through the
conscious choice of leading others without the drive for power or authority. This means that my
leadership style is based on the servant-first approach where I seek to make sure that other
people’s highest priorities are met always before my own needs come in (Lyubomirsky 2007, p.

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15). By being a servant leader, my main focus is the growth and well-being of others through
sharing power and helping people develop and become highly effective. This leadership style is
good since it leads to increased growth of subordinates which in turn lead to organizational
growth through commitment and engaged employees. The outcome of servant leadership is the
transfer of leadership abilities from the leader to servants which increases employee participation
in organizational processes (Luthans & Youssef 2007, p. 331). With this leadership style, there is
increased individual goal achievement and success through building on the skills that employees
have. Thus servant leaders motivate employees to achieve goals through empowerment which
creates a positive effect on the employee through motivation success and growth.
Parris & Peachey (2012, p. 382) adds that this leadership style also increases the
psychological health of the people I work with. This is because decisions are shared with other
employees while at the same time ensuring that employees are assimilated in the organization.
According to research, the servant leadership uses the bottom-up approach to prioritize the needs
of employees thus making them more engaged through community citizen behavior that
improves their psychological well-being. Maslow’s hierarchy of needs suggests that employees
have varying needs that they seek to achieve in the organization which grows as they advance up
the career ladder. This means that employees who engage well with the leaders have better
psychological health since they have their self-esteem solved by management.
Linuesa-Langreo, Ruiz-Palomino & Elche-Hortelano (2017, p. 4) states that the servant
leader relates with employees at a level that goes beyond personal by involving them in decision
making in the organization. This means that as a leader, I relate with employees rather than act
like I am above them or superior to them. Since this approach is based on a bottom-up approach,
then it means that the leader has to find ways of working with employees through involving them

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in different decision situations in the organization. The reason for choosing the servant
leadership style is the fact that it creates better conditions for the employees to work with which
makes it easy for them to interact with me as their leader while at the same time create better
conditions that lead to increased satisfaction. To increase employee performance, employees
work better with the servant leadership style since it makes them feel like they are cared for
when the leaders show significant interest in others. thus as a leader with servant leadership
abilities, I put the needs of the people that I serve first rather than depicting myself as their
superior by exemplifying leadership qualities.
From my analysis of the relations that I have with the people I lead, they view me as a
caring leader who develops an environment that meets their needs. The servant leadership style
makes me look caring and one who puts the needs of the people first. Through the servant
leadership style, I am able to meet the needs of the employees since they feel appreciated and
cared for at all times. The leadership style uses a bottom-up approach that allows employees to
participate in decision making at the organizational level (Rodríguez-Carvajal, Herrero, Van
Dierendonck, De Rivas, & Moreno-Jiménez 2018, p. 291). Therefore, as a servant leader, I am
viewed as the one who puts the needs of the people I serve first since through involving them in
decision making, I am able to easily meet the needs of the people I work with.
Reed, Vidaver-Cohen & Colwell (2011, p. 421) argUe that, one challenge with this
leadership style is the problem of balancing between the needs of the organization and those of
the people I serve. This means that I have to work on the decision making approaches that I use
to ensure that I am able to balance the needs of the organization and those of subordinates. This
means that when dealing with employee related issues, I have to learn how to tailor them to meet
the needs of the organization. For example, this can entail borrowing from the aspects of the

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leader-member exchange theory to increase organizational outcomes. Leaders need to understand
how to approach different situations and how to weigh the existing options to pick the best that
reflects the needs of the organization while at the same time considering the needs of employees.
Since the servant leadership style works against the traditional authority of managing
organizations, then the leader needs to improve on ways of ensuring that absolute authority is not
lost. Through limited managerial authority, this approach makes it difficult for management to
motivate employees since most decisions rest in the subordinates (Liden, Wayne, Zhao &
Henderson 2008, p. 189). This means that as a servant leader, I have to earn ways of motivating
employees by understanding how to make work conditions better for employees. If this area can
be improved, then work conditions can be better and employees can be highly effective.
Conclusion
The leader-member exchange theory seeks to create conditions that allow social
exchange between the leader and employees that create conditions economic and social
exchanges that lead to reciprocating relationships. This means that the leader creates conditions
that increase job performance through increased employee expectations. This theory thus creates
better conditions that meet the needs of the organization. By applying this theory, the leader
understands the requirements of the organization thus making employees more productive. This
theory works in any work condition and can be tailored with my servant leadership ability to
improve the ability of the leader to meet the needs of the organization while at the same time
creating better conditions for employees to thrive.

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