Mormon theology is centered on grace, we just don't use that word much - not nearly enough, in my opinion, although we are using it more and more. We believe in grace completely, but we don't believe in effortless exaltation. Bluntly, we believe the preponderance of the Biblical canon, not just the few verses that seem to imply our effort is pointless.
I approach this topic in a very Biblical way - by distinguishing between "works" (the action of following the law without any conscious thought - "blind obedience" to general counsel given to all) and "fruit" (actions motivated and energized by a connection to the Vine). Our actual theology does NOT preach "works" in this sense; it preaches "fruits". We generally do a lousy job understanding and explaining the difference. We hear "works" and think "fruits" - so we struggle to address the central distinction properly.
In other words, we "waste our lives working" if those works are not what He would want from us - and if those works do not lead us to become more Christ-like. However, if we truly are connected to Him through the Holy Ghost (experiencing what many Protestants would call an "in-dwelling of the Spirit"), our effort to become as He is will transform our actions from "dead works" to "living fruits".