Leader-Member Exchange, Employee Performance and Work Engagement
The leader is one of the dominant factors in shaping the character of his subordinates. Maslyn & Uhl-Bien (2001) explain that the LMX theory is unique among other leadership theories in that it does not consider followers as passive recipients of leadership, but both dyad partners contribute to the formation and development of relationships. By showing openness to discuss, negotiate, and support subordinates, leaders show that they value and trust their subordinates (Anand et al., 2018). The appreciation and trust given by the leader to his subordinates make subordinates feel more valued so that they can improve employee performance. In addition, leaders in a company greatly determine employee work engagement (Decuypere & Schaufeli, 2020; Lai et al., 2020; Sheikh et al., 2019; Zheng et al., 2020) by providing solutions to problems faced by employees (Enwereuzor et al., 2018; Reitan & Stenberg, 2019). Several previous studies have proven that high LMX can improve employee performance (Anand et al., 2018; A. Lee et al., 2019; Singh & Vidyarthi, 2018) and employee work engagement (Agarwal et al., 2012; Kim & Koo, 2017). For these reasons, the researchers formed the following hypothesis:
Hypothesis 2 : LMX has a positive effect on employee performance
Hypothesis 3: LMX has a positive effect on employee work engagement