Effects of Leaders' Power Construal on Leader-Member Exchange: The Moderating Role of Competitive Climate at Work

How leaders construe their power may greatly affect the quality of relationships they have with their followers. Indeed, we propose that when leader power is (perceived to be) construed as responsibility, this will positively affect the extent to which followers perceive high quality leader-follower relationships (LMX), whereas the opposite will be true when leader power is (perceived to be) construed as opportunity. Moreover, we argue that these relationships are contingent on contextual influences, such that the effects will be particularly strong in environments characterized by competition, because such environments exacerbate the impact of leaders' behavior. The results of a scenario experiment (Study 1), and a two-week time-lagged study among organizational employees (Study 2), showed that a manipulation of leaders' tendency to view power as responsibility (Study 1), and followers' perception of the extent to which their leader sees power as responsibility (Study 2) is positively related to follower LMX perceptions. Moreover, both Studies 1 and 2 and a dyadic field study in which we asked leaders to report on their tendency to view power as responsibility (Study 3) showed that this effect is stronger when the organizational climate is highly competitive. The results pertaining to power as opportunity were less consistent, but suggest a negative relationship with perceived LMX (Study 2), particularly when the organizational climate is highly competitive (Study 3). We conclude that the potential effects of leaders' construal of power as responsibility or opportunity deserve more research attention than previously awarded and provide managerial ramifications of our findings.