International Journal of Commerce and Finance, Vol. 4, Issue 1, 2018, 76-83 76 IMPACT OF LMX AND EMOTIONAL LABOR ON PERFORMANCE AND COMMITMENT Merve TARIM Istanbul Commerce University, TURKEY Abstract Leader-member relations are important for an organization’s future, because in a dynamic changing world, an organization’s survival depends on the strength of its culture and the ties between both leader and the members this kin. In order to build this kind of power, it is necessary to spend much labor from both sides. In this research, two different private university and three different groups were compared to each other. The main aim was to find out the relationship between LMX and Emotional Labor. It was showed that labor is the keyword to carry the commitment and performance further by creating a real relationship between both sides. Keywords: LMX, Emotional Labor, Commitment, Performance 1. Introduction Leader is the person who can manage the organization and lead the members to achieve common goals. However, it is not always about the leader’s effort to establish strong ties. Because of that leader- member relations is an exchange process, both leader and the members are active in this process. The members have to spend emotional labor to control their feelings and to strengthen ties and the leaders also have to spend emotional labor to control feelings and moreover to treat the members equally. If a member thinks that there is no equality in an organization, there will be in-groups and out-groups which will harm the organization in the long term. It is hard to talk about justice and trust in non-equal organizations. It is known from the literature that Adams’ Equity Theory is one the justice theories which depend on the comparison of ratios of inputs and output of someone to another. That is why, a leader needs to make the members feel equal according to each other to build a trust based organization and to make the equality valid for everybody in the organization, and leader should spend emotional labor. It is not easy to manage feelings, sometimes it can be possible only to reflect a fake impression just to save that moment. However, sometimes controlling can be deeper and a person can act as if it were real. Sometimes there is no need to pretend because that behavior belongs to intimate level. In this study, there are two different private universities and from these universities three different groups are participating this research which includes both academic and administrative personals. The study has the importance because there are fewer researches about taking LMX and emotional labor concepts together. The aim is to find a relationship between LMX and Emotional Labor, then to find out that both of them can affect commitment and performance positively. 2. Literature Review And Hypotheses Leader-member exchange process has been studying by scholars, to find the way to describe a better organization for survival. Because of that there is an exchange process; labor is the keyword for both sides. Leader is the person to lead the whole process but members have the rights to effect the process too. 2.1 Leader-Member Exchange Theory This theory focuses on three elements; these are the leader, the member and their dyadic relationship. Their relationship and the processes are depends on these ties’ strength. To establish strong ties, there are three important factors. These are trust, responsibility and respect. While establishing the strong ties, the leader must be equal and there should not be an in group-out group diversity. Since this theory began to scrutinize, there has been an In te rn a ti o n a l Jo u rn a l o f C o m m e rc e a n d F in a n c e Impact Of Lmx And Emotional Labor On Performance And Commitment 77 improvement about the theory because from VDL to LMX, there has been a misunderstanding. Because VDL (Vertical Dyadic Linkage) had a formal way of dyadic relation and the main goal was to achieve common goals. However, LMX focuses on the relationship between the leader and each member to survive. The ties established can protect an organization from every dynamic disaster. To talk about the existence of LMX in an organization, there must be trust, effect, respect and contribution. These are the duties of the leader but it is not such easy way to establish strong ties. There must be justice, honesty, openness, and equality to build trust. Otherwise, there is no reason for both sides to spend emotional labor. (Bauer & Green, 1996) (Dinesch & Liden, 1986) (Erdogan, Liden, & Kraimer, 2006) (Graen, Chun, & Taylor, 2006) (Hochwater, LMX and Job Tension: Linear and Non-Linear Effects and Affectivity, 2005) (Hofmann, Morgeson, & Gerras, Climate as a Moderator of the Relationship Between Leader- Member Exchange and Content Specific Citizenship: Safety Climate as an Exemplar, 2003) (Jansen & Van Yperen, 2004) (Tarım, Genç, Magnusson, & Zaim, 2017)(Tarım, 2017). 2.2. Equity Theory of Adams According to Equity Theory, put forward by Adams (1963-1965), focuses on the consequences of employees' perception of equality and this perceived equality / inequality. If the employee has the idea that his / her output / input ratio is not equal when comparing the output / input ratio of another employee; the inequality sense is starting to enter the circuit. This perception becomes anger in time. When the emotion reaches the maximum level, the idea that the inequality can no longer be removed. (Brockner, Greenberg, Brockner, Bortz, Davy, & Carter, 1986) (Martin & Peterson, 1987) (Huseman, Hatfield, & Miles, 1987) (Folger & Cropanzano, 1998) (Greenberg J. , 1990) (Cropanzano, Byrne, Bobocel, & Rupp, 2001) (Farh, Podsakoff, & Organ, 1990) (Graen & Uhl-Bien, 1995)(Tarım,2017) 2.3 Emotional Labor Emotional Labor is the fulfillment of the behavior of the individual as determined by the organization in the service process. Emotional Labor consists of three phases. These are surface acting, deep acting and sincere behavior. When acting is surface acting; the person does not feel the emotion but acts as if he feels emotion using his voice tone and his mimics. The process is expressed only by a superficial change. The deepening of the act is a process in which one tries to feel and feel the emotion. Individuals use a variety of methods to reflect the desired emotions. They can connect with them by bringing them to their previous experiences in order to be able to appeal to them or give them the desired emotion. (Humphrey B. E., 1993) (Grandey A. A., 2003) (Morris & Feldman, 1996)(Tarım, 2017) Leaders are also tasked with this process. Leaders who build strong ties with their employees, motivate them, and improve their performances, internalize their emotions, and even rely on them. This can be accomplished primarily by leaders who can control their own emotions and strive to ensure that their employees are not exposed to any emotional exhaustion. The individual's labor to reflect the desired emotion; especially when internalization has not been achieved, leads to emotional exhaustion or mismatches of emotions. The person's emotional fatigue life can be transformed into depletion at a later stage. Emotional Attention in the labor process and the time to control the behavior is important. The longer the person needs to act, the more emotionally it wears out and loses the control. (Grandey C. M., 2002) (Morris & Feldman, 1997) (Humphrey R. H., 2012)(Tarım, 2017) 2.4. Hypotheses H1: LMX and Emotional Labor have positive relationship H2: Emotional Labor and Performance have positive relationship H3: Emotional Labor and Commitment have positive relationship 3. Methodogy And Analysis With the 11 participants from two different universities, face to face interviews were conducted. The collected data was coded and added to package programs for analysis. Two different programs were used for completing both of their results. These programs are THEME and Nvivo. Merve TARIM 78 3.1 Sample Data In this study, there are two different private universities and from these universities three different groups are participating this research which includes both academic and administrative personals. There are 11 people participating this research. It was important to get easy accessibility and accurate data in the selection of the sample. Taking two different universities was important to make a comparison between them. 3.2 Data Collection Researchers have resorted to various forms of data collection within the historical flow. The development of technology also plays a role in the diversity of tools. Face-to-face data collection method, together with the use of the phone, has left the place to the method of collecting data via telephone. However, by collecting data via telephone; there are some disadvantages compared to the face-to-face data collection method. Since the participant in the call can not interact with the researcher individually, a trusting environment can not be created and the data can not be obtained correctly. Participants; they may be suspicious that the researcher is sensitive about sharing his or her identity and answers. So they will be less honest about their answers. (Holbrook, Green, & Krosnick, 2003) (Wilson, Roe, & Wright, 1998)(Tarım, 2017) Because of these possible disadvantages about getting the correct answer, face to face interviews were preferred in this research. 3.2.1 Nvivo To conduct qualitative research with the development of technology, new package programs have emerged and thus facilitated the processes of qualitative research. NVivo makes it easy to base the literature on the research. To take Nvivo reading notes, link them to the research journal and justify their ongoing role in the conceptual / theoretical development; it is possible to use annexed notes. (Çelik & Ekşi, 2015) (Hutchison, Johnston, & Breckon, 2010) (Bazeley & Jackson, 2013)(Tarım, 2017) 3.2.2 THEME THEME is a computer program developed and implemented with the algorithm of matching was invented by Dr. Magnus S. Magnusson. The proposed model typology and perception algorithm is based on the identification and perception of a particular relationship between event pairs in a time series called critical interval relation. T-pattern. T-pattern is a hierarchical time-based pattern type. The algorithm first detects patterns that are simpler. Then, with more complex and complete patterns easier, the pattern evolves with completion competition and pattern selection. (Magnusson M. S., 2000) (Magnusson S. M., 2016)(Tarım, 2017) 3.3 Analysis The data was coded according to both leaders’ and members’ answers. The coded data was added to THEME and Nvivo. The results supported each other to actualize the hypotheses. The coded data was analyzed in Nvivo, and LMX and both the members’ and the leaders’ emotional labors' relationship, their relations with commitment and performance were searched. Table 1: LMX Ratios according to Interviews (Tarım, 2017) Impact Of Lmx And Emotional Labor On Performance And Commitment 79 According to Table 1, three groups’ answers’ compared to see LMX ratios from group to group. (1: Completely, 0,5: A Little, 0: None) It is seen that, group 2 has the highest LMX ratio, group 3 follows and group 1 has the lowest ratio of LMX. 3.3.1 THEME Results In THEME, the coded answers’ harmony and consistency were searched to find out that LMX was exist or not. THEME results supports the results of Table 1. Table 2: THEME Analysis- Group 1 (Tarım, 2017) In Table 2, it is possible to that there is no complete harmony in first group’s answers. Members (E codes) are sharing “none” answers but the leader (M) and E3 have the same number of “completely” answers. Because of these different answers, it is hard to talk about LMX for this group. Table 3: THEME Analysis- Group 2 (Tarım, 2017) Table 3 shows that second group’s answers have more harmony and consistency according to group 1. Most of their “completely” answers are almost at the same numbers. It is possible to say that inside of this group, it has a unity. LMX can be valid for this group. Table 4: THEME Analysis- Group 3 Merve TARIM 80 (Tarım, 2017) In Table 4, the answers have close harmony and consistency to each other. E22 has different answers from the others but the most of the group has a harmony. It is possible talk about LMX in here. 3.3.2 Nvivo Results After THEME, the coded data was added to Nvivo to explain the relationship between the concepts. Comparing both the leaders’ and members’ answers the analysis of the concepts were revealed. Figure 1: Nvivo Correlation Results of the Members’ (Tarım, 2017) According to Figure 1, LMX and Emotional Labor have positive relationship. Emotional Labor and Commitment have positive relationship. Emotional Labor and Performance have positive relationship. LMX have positive relationship with commitment and performance. Figure 2: Nvivo Correlation Results of the Leaders’ (Tarım, 2017) According to Figure 2, when leaders’ added their emotional labor into the process, the commitment and performance affected positively. Labor, is the keyword to make the relations real and help the ties get strengthen. Impact Of Lmx And Emotional Labor On Performance And Commitment 81 4. Conclusion And Discussion Three hypotheses have been proven in this research. With THEME results, from group to group, it is possible to analyze LMX levels. Group 2, is the most harmonious and consistent one. LMX’s existence is easier to see according to other groups. In group 1, the answers have no harmony, because both the leader and the members gave different answers to same questions. For this group, LMX revealed less according to others. Group 3, have more harmony than group 1, it is possible to talk about LMX. 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