Relationship among authentic leadership, leader member exchange and employee’s psychological capital
Examine how well you understand the relationship between authentic leadership, effective Leader-Member Exchange and management support and the psychological capital of employees of different employee groups. It continues the development of Cultural Competence Learning Outcome and Graduate Attribute by facilitating students’ increased knowledge and awareness about how authentic leadership, effective Leader-Member Exchange (LMX) and management support interact on employees outcomes.
American Businessman Bill George introduced the concept of Authentic Leadership (AL) in the year 2003 in his book “Authentic Leadership’. It has gained more popularity and attention today as this concept of leadership helps in building an honest and genuine relationship between a leader and its employees. Authentic leaders are people with positive attitude, truthful self-concept and implement ethical practices in their work. They do job for the achievement of goals and not for any monetary benefit and power. For them achieving goal is everything. They put the aim of the organization ahead their own interest. Employees who found their leader is authentic experience more job satisfaction and feel very less job insecurity. Authentic leadership promotes stability in the organization as positive relationship between an employee and leader lead to less intention of an employee to quit an organization. In addition, it promotes and encourages creativity among employees that helps an organization to use innovative ideas shared by their employees and helps an organization to survive in long run. An AL helps in building psychological capital of employees of an organization positively and effectively. For this the efforts and proper care is taken by an AL to inculcate sense of belonging among the employees of an organization. It is also necessary for an AL to be self-aware and follow ethics for sustainable achievement of organizational goal.
In Authentic leadership (AL), a leader shares his thoughts, opinions, feelings, and other information openly and clearly with others. An AL shows transparency in his work and affects employee’s attitude and behavior positively. Employees feel and believe psychologically safe therefore significantly contributes towards the achievement of organizational goal. An AL influences and inspire his workforce to contribute to the organizations goal with full zeal and enthusiasm. Any relationship in this world is based on trust and respect. One of the exceptional and practical theory of leadership Leader member exchange (LMX) theory is also known as Vertical Dyad Linkage theory. Leader member exchange is an interactive relationship between a leader and his followers. This theory deals with how a leader develops relationship with its team members and whether these relationship can significantly contribute to the growth or not. The relationship quality can be assessed by measuring the degree of trust, understanding, cohesion and support of leaders and members. A leader in a group maintains his position via exchange agreement with its fellow members. An AL helps in improving leader-member exchange quality and therefore gaining trust and confidence of employees. The theory of leader member exchange focuses on the fact that people are different and they need an interaction. In the year 1987 it was being suggested by Grean and Scandura that the LMX theory of development goes through three phases. The theory focuses that relationship between a leader and his subordinates go through three phases. They are role taking, role making, and routinization.
Role taking
It takes place when a team member joins a group. Then leader of the group measure and evaluate the skills of the new member and provides them with an opportunity to display their capabilities and capacities.
In this process, new team members start working on a project assigned to them. It is generally expected by a leader that new members will perform their duties and tasks assigned to them with full honesty, sincerity, dedication, and diligence. Building trust is really important in role making process if a leader feel betrayed then this can lead to demotion of the member out -group. During this phase a leader, divide new members into two groups:
In-group (High quality LMX): if a member proves himself skilled, honest, sincere, capable, dedicated and diligent then he is in-group. The level of job satisfaction in in group member is high therefore they perform better in job.
Out-group (Low quality LMX): if a member deceive the trust of a leader and proves his incompetence, incapability, low level of dedication and insincerity then they are put out of the group (Medium, 2017).
In this last phase, a routine is established between a member and his leader. In-group members try their level best to please the leader by showing respect, forbearance, and faith. Whereas out-group members may not like and not trust their leader because their self-centered quality may influence them to not to trust their leader. The in-group members are usually similar to their leaders.
This leader member exchange theory focuses on how a leader understands his team members and related to the effectiveness of an organization. More the in-group members means high quality of LMX and vice versa. High quality LMX means frequent promotions, evaluating employee’s performance positively and high degree of commitment towards organization. So it is important for a leader to develop high quality of LMX with all his team members rather than establishing with few. An attempt should be made by the leader to make each and every individual feel that he/ she is an important part of the organization this helps in reducing the adverse implications of being out-group.
Luthans and his colleagues first introduced the concept of physcological capital, which consists of four positive physcological resources self-efficacy, hope, optimism, and resilience.
Self-efficacy: It means believing in one’s ability to achieve the goal and successfully accomplish a task. There is a favorable relationship between self-efficacy and creativity. An authentic leader always gives attention to the strength and potential of employees and constantly encourages their growth. Employees develop more confidence in achieving their goals.
Role making
Hope: An authentic leader is always hopeful with positive belief and attitude. This attitude of a leader helps in enhancing the will power of employees. Employees with positive attitude and outlook do not hesitate in taking risks. Even if they do no achieve their goals, they look for creative ways to avoid hindrances coming their way.
Optimism: The motive of an authentic leader is to encourage positive vibes and motivate its employees positively and effectively so that they can face any kind of challenges in their life. Employees with optimistic approach keep themselves away from unfavorable life event such as depression and desperation.
Resilience: Life is filled with vicissitudes. Every person sometimes faces a turning point in his or her life. People who overcome from difficult and tough phase of life quickly are supposed to be resilient people. An authentic leader increases confidence and efficacy among employees, which help them to overcome from problems and adversities with greater degree of resilience. A leader can predict adversity, misfortune and suggest methods to its employees to face the adverse phase with full confidence. In addition, a leader always makes a backup plan for facing adversity and copes up with vicissitudes (Avey et al., 2008).
Today stress at workplace is becoming a matter of concern for managers. Therefore, it is important to combat with this problem by adopting various strategies and techniques Psychological capital or Psycap, consists of efficacy, hope, optimism and resilience together. Positive psychological state of a person is indicated by efficacy, optimism, hope, and resilience. Psychological capital is related to employee’s attitude. The attitude of an employee may be desirable or undesirable. If an employee is concerned about the well-being of an organization in which he works, feels job satisfaction and stick to the commitment of an organization then he is considered as desirable employee. Whereas, if an employee is skeptic, dubious, apprehensive and agitated then his this kind of attitude is considered as undesirable. When employees give, their best to achieve success they perform better. Building of Psychological capital helps a leader to develop robust workforce, which can contribute significantly towards the achievement of organizational goals. With the increasing complexities in business world, it has become necessary to influence employees attitude by developing Phycap among the various employees of an organization associated with it. It should be start with the development of Phycap in leaders of an organization so that its impact can be transferred to the lower level management employees. Once the top-level management persons are able to exhibit their positive psychological capital then it would be easy for the lower level person to grab the concept and follow it. When a sense of belongingness is created among employees, more focus is given on employee’s job satisfaction and employee experience low level of job insecurity then this helps positively in building employees psychological capital. It is not necessary that only top level and middle level employees be only considered for developing the concept of psychological capital. The concept of psychological capital is wide and extended to lower level employees. Whether a person is doing white collared job or blue collared job both are considered equal when it comes to developing and inculcating the concept of phycap.
Routinization
It is significantly important for an AL to develop psychological capital positively among the employees or members associated with an organization. As a positive development of psychological capital among the work force helps in contributing favorably towards the achievement of aim of an organization. Psychological capital can be built among employees by encouraging creativity, developing sense of belongingness, self-esteem, strength, potential and increasing participation of workforce. The workforce lead by an effective and efficient AL develops higher psychological capital, which leads to increasing creativity among the workforce. Being self-aware, ethical, unbiased and transparent with the workforce an AL gains trust and respect of the workforce he is organizing.
Emotions vary from person to person. An emotion is not prolong like mood rather it is a short period change with time. Employees’ emotion and mood affect positively or negatively on their work. Emotions influence decision-making power and creativity. An employee brings all himself to work. It means an employee comes to his work along with his mood and emotions. Along with his brain, an employee brings emotions such as joy, anger, apprehensions and many more to his work. An employee with cheerful, happy, healthy, and glad mood affects his surroundings positively and focuses on achieving the goals of an organization. He tries all his efforts and gives best towards his achievement of organization’s goal whereas if an employee is full of apprehensions, tensions and confusion he negatively affects his surroundings and his focus on achieving goal is not up to the mark. An AL influences and inspires his workforce to contribute to the organizations goal with full zeal and enthusiasm and try their level best towards the achievement of organizational goal. An organization directly or indirectly faces the consequences of employee’s emotions and mood. Negative emotions contribute negatively towards an employee’s performance which indirectly affects organizations aim, turnover and can cause serious financial loss to an organization. Such employees can become hindrance towards the growth, progress and success of an organization. For example: if an employee is mentally disturbed due to some tensions at home then in this case he cannot concentrate on his work . Even if he is away from home at work place his mind still think of tensions prevailing at home. An agitated employee can sometimes show his anger towards other employees and colleagues of an organization which results in spoiling the mood of others. Their emotion can also get hurt just because of one agitated employee working in an organization. So it is important for an employee to manage his emotions at work face because his emotions are not only affecting a single individual i.e. he himself but also affecting the emotions and mood of others at workplace and adversely affecting towards growth of employees.
Conclusion
From the above a conclusion can be derived that authentic leadership plays a vital role whether in leader member exchange or building psychological capital among employees. An authentic leader affects employee’s behavior and attitude and inspire them to work with full zeal and enthusiasm. Leader Member Exchange (LMX) theory focuses on developing relation of a leader with its team members. If they share a healthy and cordial relationship then they can significantly and positively contribute to the growth and success of an organization. An AL helps in building psycap of employees by developing efficacy, inculcating optimism, hope and resilience so that they can face any kind of adversities and challenges coming their way in life. It is become important for an AL to develop psycap among its employees as growing stress and tensions at workplace can become hindrance in the development and achievement of organizational goal. Once the psycap is inculcate among the employees then this can impact positively on the emotions of employees and their performance at workplace. It is important for each employee to control his emotions at his workplace though it is not easy but it is also not impossible to control one’s emotion at workplace. Every employee must understand the fact that his negative emotions are not only harmful for his own progress but they are leaves an adverse impact on the progress of an organization. Whereas an employee with positive emotions and happy go lucky mood can take his organization at heights where he is working.
References
Avey, J.B., Wening, T.S., Luthans, F., et al. (2008) Can positive employees help positive organization change? Impact of psychological capital and emotions on relevant attitudes and behaviors. The journal of applied behavioral science, 44(1), pp.48-70.
Medium. (2017) Leader Member Exchange. [Online] Available from: https://medium.com/@nigelstone163/leader-member-exchange-lmx-what-is-it-and-why-you-should-care-7e59825d9753 [Accessed 18-07-2018]
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