Unlocking employee innovation through leader-member exchange: New directions and developments

The dissertation examines how leader-member exchange (LMX) between a supervisor and a subordinate is connected to employee innovativeness. The study addresses this through three research questions. First, it explores whether both high-quality and low-quality LMX relationships can, under certain conditions, enhance an employee’s ability to be innovative and develop new ideas and practices. Next, it investigates how the LMX relationship relates to employee attitudes toward external ideas—specifically the so-called “not-invented-here” syndrome. Third, it analyses how LMX relationships are linked to innovativeness when viewed through the lens of team dynamics and social comparison. In this context, the aim is to understand how differences in the quality of LMX relationships within a team, and an individual’s relative LMX standing within the team, impact idea generation.

The findings of the study show that even a low-quality LMX relationship can support employee idea generation when the organization is perceived as supportive of innovation. Furthermore, the study identifies different roles for LMX in various stages of innovative behaviour: idea generation, idea promotion, and idea implementation. Additionally, the study reveals an interaction effect between LMX quality and person-organization fit on the "not-invented-here" syndrome: employees who had a high-quality LMX relationship and a strong alignment between their own values and those of the organization showed fewer prejudices toward external ideas than others. Lastly, the study identifies that differences in LMX relationship quality within a team, along with an employee’s relative LMX position, can trigger social comparison processes, which may have either positive or negative effects on employee innovativeness depending on situational factors.

The findings of this dissertation highlight that LMX relationships are an important part of working life and that they influence employee innovativeness in multiple ways. Through its perspectives, this dissertation complements previous research literature, which has traditionally focused on understanding the formation and outcomes of high-quality LMX relationships.