LMX Differentiation and Group Outcomes: A Framework and Review Drawing on Group Diversity Insights

Abstract

In this review, we address inconsistencies and a lack of clarity in the study of leader-member exchange (LMX) differentiation and group outcomes. We do so by drawing on another highly visible group dispersion literature in the management domain, group diversity, based on the recognition that LMX quality is a characteristic on which group members vary. Utilizing insights from Harrison and Klein’s typology of group diversity constructs, we introduce a framework that specifies the meaning and shape of three variations of differentiated leader-member relationships in groups and connects each construct with implications in terms of theorizing and measurement. Specifically, our framework conceptualizes LMX differentiation as LMX separation (dispersion in LMX relationships as disagreement or opposition regarding an opinion, perception, or position), LMX variety (dispersion in LMX relationships as distinctiveness in kind, source, or category), and LMX disparity (dispersion in LMX relationships as inequality in concentration of valued social assets or resources). We then apply this framework to conduct a systematic review of the LMX differentiation literature with particular attention to alignment among a study’s descriptions of the construct, application of theory, expected group outcomes, and construct measurement. Finally, we offer recommendations for future research and for applying our framework to enhance reliability, validity, and generalizability in studies of LMX differentiation and group outcomes.

How and When Relative Leader–Member Exchange (RLMX) Invigorates Attendance at Work Within a Context of LMX Differentiation

“…Based on the work of Harrison and Klein (2007), Buengeler et al (2021) make an impressive effort in modeling the types of LMX differentiation as well as in examining the theories and measures associated with them. These scholars have highlighted three distinct forms of LMX differentiation in groups, namely LMX separation (i.e., “dispersion in LMX relationships within a group as disagreement or opposition regarding an opinion or position”), LMX variety (i.e., “dispersion in LMX relationships within a group as distinctiveness in kind, source, or category”), and LMX disparity (i.e., “dispersion in LMX relationships within a group as inequality in concentration of valued social assets or resources”).…”

“…These scholars have highlighted three distinct forms of LMX differentiation in groups, namely LMX separation (i.e., “dispersion in LMX relationships within a group as disagreement or opposition regarding an opinion or position”), LMX variety (i.e., “dispersion in LMX relationships within a group as distinctiveness in kind, source, or category”), and LMX disparity (i.e., “dispersion in LMX relationships within a group as inequality in concentration of valued social assets or resources”). Based on this model, we examine in this study LMX separation, which captures group members’ dissimilarity about LMX and in-group and out-group categorization (Buengeler et al, 2021).…”

“…At the collective level, these relational boundaries within teams (“us” and “them”) are not desirable because a high LMX separation may elicit tensions and relational conflicts (Buengeler et al, 2021; Zhou & Shi, 2014) as well as reduce performance (Sui et al, 2016). We argue that high RLMX team members are more likely to experience energizing emotions, such as pride or gratitude, when LMX differentiation is high because this context signals that these employees are treated better than the other group by the leader.…”

“…LMX differentiation refers to the dispersion of LMX in a group and is recognized as having effects above and beyond individual-level perceptions of LMX or RLMX. In this study, we examine a particular type of LMX differentiation, namely LMX separation, which refers to dissimilarity, or disagreement, among group members regarding LMX relationships (Buengeler et al, 2021). LMX separation is at its lowest level when all members share similar perceptions of LMX quality and at its highest when there is a very high divergence in perceptions of LMX among team members (Harrison & Klein, 2007).…”

“…To date, RLMX and LMX differentiation have received very little attention from researchers (see exception: Henderson et al, 2009). We draw mainly on COR theory (Hobfoll, 1989) and the social comparison perspective (Buunk & Gibbons, 2007; Festinger, 1954; Wood, 1989) to explain the influence of RLMX on the social identity and social categorization perspectives (Tajfel & Turner, 1986), and on the recent LMX differentiation work by Buengeler et al (2021) to explain the moderating role of LMX separation. This study proposes that reactions to higher RLMX will be more positive when LMX differentiation is high rather than low because high LMX differentiation elicits positive downward comparisons, which induce energizing emotions.…”