The Role of LMX and LMX Differentiation in Guiding Successful ISD Team Outcomes

Abstract

Over the past few decades, a great deal of research has been conducted to examine the complex relationship between leadership and team outcomes. However, little empirical study has investigated this relationship from the dynamic perspective, especially under the context of Information System Development (ISD) teams. Moreover, the moderating variables potentially affecting this relationship are still not fully answered with mixed findings in the literature. To address these issues, current research explains whether and how the group level of Leader Member Exchange (LMX) within an ISD team affects the team outcomes. Using surveys from 1410 employees on 143 ISD teams in China, we found that group-level LMX had positive effects on ISD team creativity, ISD team satisfaction and ISD team learning. Further, moderated path analysis revealed LMX differentiation strengthened the relationship between group-level LMX and these three kinds of ISD team outcomes. We discussed the implications of these findings for innovation theory and leadership research, as well as for management practice.