Leader-Member Exchange Model

The group is considered to be an important sociology and social psychological unit of analysis in the study organizational behavior. Groups are the interactions and forces among group members in social situations. A group can be defined as two or more individuals, interacting and interdependent, who have come together to achieve a particular objective. There are usually two kinds of groups: formal and informal. Formal groups are those groups that are defined by the organizational structure and are related to work tasks.

Whereas informal groups can be defined as the alliances that are neither formally structured nor organizationally determined, these groups are usually formed naturally, when people have things in common with each other. (Robbins, 2000) You must be wondering why people join groups, well they join groups due to security, that is people are able to reduce their insecurity of being alone. Another reason would be status, that is being in a groups make them feel important and others also view them as important individuals.

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Another reason would also be power, that is, when a person is not able to achieve an objective individually, it can be achieved through a group etc. The Concepts of In and Out groups In Groups An in- group can be defined as a social group towards a person feels unconditionally loyalty and respect because of their membership in that particular group. And due to this loyalty for the particular group, people generally develop an in group bias. In- group bias means, that people in a particular group give preferential treatment to those individuals who are in that particular group with them.

Usually the effects of in groups are considered to have a high power and these groups are very strong. Out Groups In terms of sociology out groups can be defined as a social group, where other individuals feel contempt towards it or they have a desire to compete against that group and in lay man terms out- groups can be defined as people who are not in your group, people who considered as social outcasts. The members of out-groups are usually subjected to out- group homogeneity bias.

That is people in in-groups consider themselves to be more varied than the members from the other groups. For example, in the Harry Potter series, people who did not have pure wizardry blood in them, they were considered to be outcasts i. e. they were in out- groups from the rest of the wizards. ‘In group’ and ‘Out group’ Situation In-group situation: in a financial department, where some the members of the department make a group and they put in their efforts and the outcome of those combined efforts is better than the individual efforts.

With the help of the work group the organization’s productivity increased and the performance of the organization also improved tenfold. The use of such work groups within the company increased the company’s potential and provided a great deal of benefits for the company as well. (Robbins, 2000) Out- group situation: what happens is that if you are not in the work group or in an in-group of a company, the person has to put in double of his or her individual effort.

That people who are working in the company but are working separately, for example, people working for commissions like insurance sale people, they work for the company and do get a monthly salary but individual effort is more important for they make more money only if they are able to sell insurance and each person’s turnover is different each others.

Analyze the Major Differences between the Two Situations The major difference between the two is that in an in-group, there is group effectiveness, i. e. organizing work around intact groups, using groups to enforce strong norms for behavior etc. And major difference is that there is group cohesiveness, i. e. there is agreement between the members, they get together with each other, and there is frequency of interaction between the members. Whereas in an out-group people are independent to do whatever they want to, they are not dependent on each other. There is no power realignment between individuals like there is in groups and then there is also no free riding because everyone has to do his or her own task themselves.

(Luthans) In-group and an Out-group Affects on the Groups and the Organization There are some positive effects and as well as negative effects of in-groups and out-groups within an organization. Positive effects would include; goal achievement, i. e. sometimes it happens that an individual person is not able to accomplish a task on his/ her own, therefore in such cases the management of the company will rely upon the groups to accomplish tasks. Another positive effect of groups can be affiliation that is with the help of groups social needs can be fulfilled in the company.

It is a known fact that all humans enjoy interaction with others that comes only with being in a group. (Moe, 1988) There are some negative effects to, for example, when work groups are not a success it is usually the organization that has to pay in ways like productivity. And another negative effect would be the performance of employees’ decreases and sometimes it so happens that motivation of the employees is also reduced. Other negative effects of groups would be the coordination of cost and lastly there is legal hassle within the groups (whether they are in-groups or out-groups).

Task Related & Non-task Related Factors Task Related Factors • Goal achievement • Self-esteem Non-task Related Factors • Status • Power • Affiliation Leadership Leadership can be defined as the ability that an individual has to influence a group of people to achieve a set of goals for the company. This source of influence can be formal or informal. For example, the CEO of General Motors Alan Mulally leadership style is working together. Alan Mulally believes in this leadership style. Leadership is increasingly taking place within a group/ team context.

As work groups grow in popularity, the role of the leader in the guiding team members takes on heightened importance. The CEO believes that with the help of work groups the organization’s productivity will increase and the performance of the organization will improve tenfold. Leader’s relationship with followers There should be a great deal of communication between the leader and the followers, so the both parties learn about each other and so that the task can be completed on time and the project becomes a success.

The leader should be sensitive to the needs of its followers as well because if the flower believes that the leader is not sensitive to their needs then the follower will become dissatisfied and this would lead to his or her decrease in productivity. (Corey & Corey, 2006) References Corey, M. S & Corey, G (2006), ‘Groups: Process and Practice’. Thomson Wadsworth Luthans, Fred. (n. d. ) ‘Organizational Behavior’. New York: McGraw-Hill Moe, T M. (1988), ‘the Organization of Interests: Incentives and the Internal Dynamics of Political Interest Groups’. University of Chicago Press Robbins, S. P. (2000), ‘Organizational Behavior’. Prentice Hall