LMX theory (Leader-Member Exchange theory)

Leader-Member Exchange (LMX) theory suggests that leaders develop different relationships with each team member. Some employees enjoy a closer, more trusting, and supportive relationship, often gaining more help, information, and opportunities. Others have more formal or distant interactions. These varying relationships influence how well employees perform, feel committed, and are satisfied at work. Essentially, leaders don’t treat everyone the same—they form unique bonds that impact team dynamics and individual success. High-quality LMX relationships tend to lead to better outcomes for both employees and organizations.