Commentary by Dr. Whitesel: I’ve been an out-group member of a leadership team as well as an in-group member, and I can confirm what we all know: the latter is preferable. But why does this happen? It has to do with experiences that are embedded in our brains. The experiences foster “LMX” for “leader-member exchange” which can be stronger with certain people than others. But it will be helpful at times and hurtful at other times. Read this Harvard Business Review article to beginning learning the difference.
by Bradley Kirkman, Hui Wang, Ning Li and Yang Sui, Harvard Business Review, 4/10/17.
…But whether leaders think it or not, one of the most consistent findings in our (and others’) research is that almost all leaders do treat members differently — mostly without knowing they’re doing it. This works a lot like subconscious biases that, when revealed to people, almost always result in feelings of surprise and embarrassment. Leaders can’t help having implicit ideas and preferences for what they want their team members to do and to be like. And those preconceived notions lead to what researchers have called “differentiation” in the level of relationship quality leaders have with members, with relationship quality often referred to as “leader-member exchange,” or LMX for short.
When a leader and a follower share a high level of LMX, that follower typically exhibits the types of positive outcomes all leaders want to see, such as high performance, job satisfaction, and organizational citizenship behavior, or going above and beyond one’s typical job responsibilities. Those with high LMX are also more committed to their companies, more satisfied with their leaders, and less likely to quit their jobs. So if high LMX generates all of these positive outcomes, why don’t leaders build high LMX levels with all of their followers? We have already mentioned the effects of implicit leader preferences — a lot of differential treatment occurs naturally and without a great deal of conscious thought. Beyond the subconscious explanation, however, is one that is more practical: leaders today simply don’t have the time necessary to build high-quality relationships with everyone in their team. This is even more complicated in lean organizations, in which many leaders have responsibility for large teams (and often several teams at once).
Fortunately, research suggests that playing favorites can be healthy for motivating high performance in teams and individual members alike. In fact, the effects of LMX differentiation — or the extent to which leaders form relationships of different quality with members in the same team — can be positive for both team and individual outcomes, depending on whether certain conditions are present. For example, our colleagues Berrin Erdogan and Talya Bauer at Portland State University found that LMX differentiation has no effects or positive effects on individual team members as long as those team members perceive that their leaders have created a team climate characterized by fairness. That is, there are no effects or positive effects when leaders provide resources to team members using fair and unbiased decision-making procedures. Specifically, Erdogan and Bauer found that more LMX differentiation was associated with increased helping behaviors among team members when members believed they were working in a fair team climate. Similarly, Bob Liden of the University of Illinois at Chicago and his colleagues found that LMX differentiation was associated with higher team performance but only when there was a high level of coordination, communication, and integration within the teams (known as team interdependence).