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In this chapter, we introduce a new measure of member-member exchange (MMX) based on Graen’s theories of role making (1976) and LMX leadership (Graen, 2003a; Graen, 2003b). We also examine the relationship between peer leadership and work group process and performance. The peer leadership measure used in our study is similar to team-member exchange (TMX) (Seers, 1989); however, we used a social network approach to reduce the social desirability and capture the group-level relationship quality that emerges from each dyadic-level relationship. Correlates of MMX leadership were examined using social network analysis to determine the kinds of group member interactions that facilitate peer leadership. These include perceptions of trust, interactions related to technical and customer issues, and non work-related, friendship patterns. Correlations between the MMX leadership structure and traditional group process constructs (e.g., coordination, communication, trust and high performance norms), organizational context, and external leadership were also examined. Finally, group effectiveness outcomes associated with peer leadership were assessed, including member satisfaction and objective team performance.

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