Virtual interaction and failure learning—The crucial role of team LMX composition

Abstract

The COVID-19 pandemic has highlighted the importance of virtual work. Enabled by the pandemic, the present study addresses the consequences of virtual interaction among regular work teams. Building on and expanding prior research, we develop lines of reasoning to suggest that virtuality negatively affects team failure learning. Additionally, we argue that team LMX quality and team LMX differentiation can help mitigate this effect. We test our hypotheses based on survey data from 73 teams working for a service unit at an international bank. In line with our theorizing, the results reveal that virtuality hampers team failure learning. Moreover, we find that team LMX quality and team LMX differentiation can serve to alleviate the negative consequences of virtuality. We discuss the theoretical and practical implications of our study to support HR managers and propose some areas for future research.

Keywords:

• Virtuality
• virtual interaction
• failure learning
• LMX
• LMX quality
• LMX differentiation

Disclosure statement

No potential conflict of interest was reported by the authors.

Data availability statement

The data that support the findings of this study are available upon reasonable request from the corresponding author. The data are not publicly available because they contain information that could compromise the privacy of the research participants.

Notes

1 Based on the performance management system in our study organization, team leaders and members were provided not only with information on the performance of their teams but also with information on how the other teams in the service unit performed.

2 As a robustness test, we reran our analyses based on the median LMX quality within the team and obtained very similar results.