Social exchange theory explains why some relationships work effortlessly while others don’t. This blog will delve into what the theory is and how we can leverage give-and-take in our work interactions. What is Social Exchange Theory? Social exchange theory (SET) is all about getting the most out of relationships while giving the least. Think of it like a balance—we want more benefits and fewer costs. This idea came from George C. Homans back in 1961. He said that relationships work when there’s a fair exchange. If it feels like we’re giving more than we’re getting, we tend to walk away. Every work relationship has its rewards and costs. Without realizing it, we’re always weighing whether a relationship is worth it based on what we’re getting out of it. How Social Exchange Theory Applies at Work At work, this theory explains why employees stick around when they feel supported. When leaders provide positive feedback, mentorship, and recognition, employees feel the rewards of the relationship. They’re more likely to stay motivated and productive. On the flip side, if the work environment feels negative, employees might start feeling like their job is costing them more than it’s worth. Over time, this can lead to burnout and, eventually, they might leave. 3 Simple Ways to Use Social Exchange Theory as a Leader Here’s how you can use this idea to be a better leader and build stronger relationships with your team: 1. Give Positive Feedback Regularly acknowledge your team’s hard work. A quick “great job” can go a long way in making people feel appreciated. When giving feedback, focus on how someone can improve rather than just pointing out what’s wrong. It shows you care, and they’ll work harder because they know you’re invested in their growth. 2. Be Supportive and Offer Guidance Make sure your team knows they can come to you with any ideas or concerns. When people feel supported, they trust you more. Help your team grow by offering mentorship and development opportunities. When they see you care about their success, they’ll stay committed. 3. Create a Positive Team Environment Encourage teamwork and make the workplace fun. When people enjoy being at work, they’re more motivated. Celebrate wins—big or small. Whether it’s completing a project or hitting a milestone, recognizing success makes everyone feel valued. By applying these strategies, you can tip the balance of costs and rewards in favor of positive, rewarding relationships, leading to a happier, more productive team. Conclusion Building positive relationships at work is key to creating a happy, productive team. When you focus on feedback, support, and creating a positive environment, the rewards of working together will always outweigh the costs. For more leadership development tips, follow my LinkedIn or check out my podcast, Next-Gen Leaders. Until next time, keep striving, growing, and leading with purpose.
