Influence of a Theory of Leader-Member Exchange (LMX) on Digitalization Processes in Organization

Abstract

Rapid digital technologies development fundamentally changes not only companies’ organizational structures, but also their work processes, leadership styles, and the ways of interactions between employees. This paper focuses on the theory of leader-member exchange that helps to understand deeper how high-quality leader-member relationships are able to promote successful digitalization. In addition, we examines what kind of role the employee innovative behaviour plays, considering this as a means that can improve the digitalization out-comes. Data were collected by the random sampling method among 260 respondents that represent private sector organizations having implemented digitalization elements into their activities. The proposed conceptual model was analyzed using structural equations and applying a partial least squares method (PLS-SEM). This gives the possibility to examine in detail the direct impact of lidership theory (LMX) on organizational digitaliza-tion processes. The results of this study highlight that leadership quality remains a critically essential aspect to improve digital transformation effectiveness.