Examining the Impact of Leader-Member Exchanges on Creativity and Innovation in Information Technology Projects: A Pathway to Competitive Advantage

Using a qualitative single case study, I explored the influence of Leader-Member Exchange (LMX) quality on creativity and innovation in IT projects within Federal Government IT divisions in the Northeastern United States. I examined leadership challenges in gaining employee support for IT modernization, and how trust, communication, digital competency, and organizational culture shaped engagement. Guided by social exchange theory and self-determination theory, I used data triangulation through semistructured interviews, observations, and surveys with 16 participants. The results of thematic analysis revealed 5 key themes: (a) trust and transparency in leadership, (b) leadership competency, (c) resistance to change and organizational barriers, (d) employee autonomy, and (e) emotional intelligence. High-quality LMX relationships enhanced motivation, reduced resistance, and reflected innovation through trust, empowerment, and psychological safety. In contrast, low-quality LMX relationships led to skepticism, disengagement, and reluctance to adopt IT changes. A notable finding was the impact of digital leadership competency on employee confidence in IT transformation. Leaders lacking technical proficiency struggled to guide teams effectively, limiting success. The results of the study’s conclusions offer recommendations for IT leadership development, including mentorship, technical training, and trust-building strategies. In addition, the results reflected the incorporation of a biblical leadership perspective rooted in stewardship, integrity, and servant leadership. These findings contribute to scholarships and provide practical guidance for improving leadership effectiveness in public sector IT transformation, filling a gap in the literature on leadership behaviors and organizational readiness for innovation.