Informal Leadership Key to Individual and Team Performance

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By Kyla Nicholson, CHRP

In the workplace and wider world, we all belong to teams, and because teams are relied on to deliver organizational results, team effectiveness is a focus of HR and business leaders across all industries. Interestingly, fostering the emergence of informal team leaders is one way that organizations can enhance the performance of individuals and teams alike.

Summary
Whether it’s a department, project or special committee team we typically see informal roles emerge within the team context. While there might be a formal team manager, project leader or committee chair, informal leaders will also arise.
When the leader is busy, these are the people that the team turns to for answers. When the leader is seeking to test ideas, this is who they turn to for thoughts and suggestions.

The research paper “A Multilevel Investigation of Leader-member Exchange, Informal Leader Emergence, and Individual and Team Performance” by Zhang, Waldman, and Wang looks at what causes these informal leaders to emerge and, when they do, what happens. The research explores the role played by the formal leader and importance of shared team vision in creating the conditions for informal team leaders to step up and impact performance.

Background
A great deal of past research has focused on team performance, and the findings from numerous studies show that shared leadership increases the performance of the team overall.

When members of a team share leadership, it doesn’t necessarily mean that everyone on the team is a leader. What it means is that the team recognizes the strengths on the team and encourages people to leverage these strengths in different ways, demonstrating informal leadership. This shared leadership allows team members to develop and learn from each other; it also gives the official manager the opportunity step out of the micro-manager trap to truly lead and develop the team.

While HR professionals and team leaders recognize that shared leadership brings benefits to team performance and ultimately organization success, understanding how to create the conditions for informal leaders to emerge and share leadership remains a challenge.

Past research on informal leadership has most often been conducted in the context of leaderless groups and studied in labs or educational settings. Few studies have explored the formal leader’s role in encouraging or discouraging the emergence of informal leadership. The research by Zhang, Waldman and Wang helps to close some of these gaps by providing insight into the way that formal leaders and shared vision—separately and together—can promote or inhibit the emergence of informal leaders on teams functioning within organizations.

Hypotheses and Results
The researchers tested a number of hypotheses to better understand the relationship between leader-member exchange, shared vision and the emergence (or inhibition) of informal leaders on work teams. They also looked at the outcomes of informal team leadership on individual and team performance. The study participants were employees in customer service teams at a large telecommunications company based in China. Multi-source data was collected at three points in time from 361 followers in 74 work teams.

Shared Vision is Essential
One key research finding is that team shared vision is positively related to informal leader emergence at the individual level. This may be due to the manner in which a common vision for team success reinforces an understanding of team direction and goals. This provides team members with the confidence to take on informal leadership roles that drive toward these objectives.

Recognizing Informal Leaders
Another key finding is that leader-member exchange is not positively related to a team member’s emergence as an informal leader as perceived by peers; the effect of leader-member exchange depends on the presence or absence of shared team vision. Team shared vision moderates the relationship between a member’s leader-member exchange and his or her emergence as an informal leader. Particularly in teams with high shared vision, there is a positive relationship between leader-member exchange and leader emergence, whereas in teams with low shared vision, the relationship is negative.

In other words, examining the relationship that the formal leader has with each of his or her employees is not, in and of itself, sufficient to predict the emergence of informal team leaders. Team shared vision plays a key role in determining the effect that leader-member exchange will have on promoting or inhibiting the emergence of informal leaders on a work team.

When there is a high level of shared team vision, team members with a high level of leader-member exchange can increase their credibility as informal leaders by using the special information, connections, access to resources and other relationship benefits gained through their positive relationship with the formal leader. Information from these high exchange individuals is more likely to be accepted, and they are more likely to be seen as proxies of the leader in this light.

In the Absence of Shared Vision
On teams where there is not a shared vision, team members will still work toward goals; however, those goals will be their perceived goals for the team or their own goals. Even for team members that enjoy a positive relationship with the leader, characterized as one with a high level of leader-member exchange, if a shared vision is not present, the rest of the team is not likely to allow that team member to emerge as an informal team leader.  This is due to the fractured understanding of the team goals and the potential for team members who have a strong relationship with the leader to be perceived as using their special status to promote their own agendas.

An Opportunity to Step Up
Informal leaders often step in to fill a role on a team. For example, several days before an important client deliverable is due the team leader does not show up at the office. News quickly spreads that she has fallen ill and won’t be available to the team for at least two weeks. The natural reaction of the team includes concern and perhaps some panic, but it also includes the tendency to look to a team member to step in and take the so-called reigns. The person looked to is most often an informal leader or one in the making: a person that shares the team and project vision, has a strong relationship with the leader that provides access to the resources and relationships needed to get the job done and who steps up (without even really realizing it) because they want to see the job done well.

Stepping up is done through a combination of self-motivation, opportunity or necessity, and the support of the team. Once they experience acceptance and success in this new informal role they may strive to continue to fulfil the role in order to maintain their informal leadership status. As such, they will continue to step in and step up as opportunities arise.

A Reciprocity of Leadership
Informal leaders also often gain extra support from their fellow team members due to the fact that availability encourages a reciprocity of exchange. Informal leaders tend to be available to their team members for advice, instruction and guidance.
In turn, team members may be more likely to support their informal leaders when they require help. In other words, team members reciprocate the positive relationship with the informal leader and this becomes a motivator of performance.

Individual and Team Success
Essentially, when informal leaders emerge their impact within the team raises the level of team performance. Kozlowski & Klein saw team performance as an emergent construct that “originates in the behaviours of individuals, is amplified by their interactions, and manifests as a high level, collective phenomenon.”

As this definition and other past research suggests, as leadership becomes shared between more people, team effectiveness grows.  As more team members take on informal leadership roles, effectiveness is further enhanced.

Implications for HR
When it comes down to it, teams get work done for your organization. Creating an environment that will elevate team members to become informal leaders is one way that organizations can improve individual and team performance alike.

To create the conditions for informal leaders to emerge, HR can support the organization to establish practices that will foster shared vision. Such practices include:

  • Establish the shared vision and goals for the team at a facilitated meeting including the formal leader, involved management and the team.
  • Hold quarterly team meetings to examine how the team is tracking in terms of its vision and goals. Use these meetings to identify and discuss barriers to success and engage the team in solution-finding to determine how these challenges can be tackled.
  • Provide coaching and/or mentoring to support team leaders and managers to effectively communicate and reinforce the vision for the organization and the team.

‘Managing’ Informal Leadership
Shared vision is not the only determinant of informal leader emergence, HR must also support managers to form positive relationships across the team so that they can build a cohesive team. This will help to foster shared vision, informal leader emergence, and general collaboration within the team.

To support effective relationship building between formal leaders/managers and team members the organization may provide training or coaching to help managers understand what positive leader-member exchange relationships look like, and how to build them through ongoing interactions.

Building positive relationships with team members will help to build an understanding of team member’s strengths, interests and opportunities for development.

This information can be used by formal team leaders to provide informal leadership opportunities to team members based on their unique knowledge, skills, abilities and interests (e.g., assign specific project roles, share team members with task forces, etc.). Formal leaders can further support team members in these informal leadership roles by providing access to information and resources, as well as tips for communicating and working with the rest of the team.

Formal Support Required
As a final thought, HR must be aware of the reactions that formal leaders and managers may have to informal leaders.

Open communication, coaching and mentoring enables formal leaders to recognize the value of informal leadership. This understanding removes any perceived threat and encourages formal support for the emergence of informal leadership rather than discouragement. Part of this process is to ensure that formal leaders are aware of their own opportunities for development and progression.

Informal leadership can take place on all sorts of work teams, and employees at all levels should have access to these opportunities within the context of their workplace.

This article is based on the following research paper:
Zhang, Z., Waldman, D. A. and Wang, Z. (2012), A Multilevel Investigation of Leader – Member Exhange, Informal Leader Emergence, and Individual and Team Performance. Personnel Psychology, 65: 49–78. doi: 10.1111/j.1744-6570.2011.01238.x

(PeopleTalk Summer 2013)

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