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Leader Member Exchange


Tom Giberson

on 24 March 2010

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Transcript of Leader Member Exchange

Exchange Theory
Conceptualizes leadership as a process centered on the interactions between a leader and subordinates/"members"

Some theories focus on leaders:
trait approach, skills approach and style approach

Other theories focus on the follower and the context:
situational leadership, contingency theory, and path-goal theory.
LMX theory makes the dyadic relationship between leaders and followers the focal point of the leadership process
Assumption - LMX theory challenges the assumption that leaders treat followers in a collective way, as a group.
LMX - Directed attention to the differences that might exist between the leader and each of his/her followers
Leader’s work unit as a whole was viewed as a series of vertical dyads; leader forms unique relationship with each subordinate
Early research findings:
Expanded/negotiated role responsibilities (extra-roles) = in-group
Relationships marked by mutual trust, respect, liking, and reciprocal influence
Receive more information, influence, confidence, and concern than out-group members
Formal employment contract (defined-roles) = out-group
Relationships marked by formal communication based on job descriptions
In-group/out-group status based on
How well subordinate works with the leader and how well the leader works with the subordinate
Whether subordinates involve themselves in expanding their role responsibilities with the leader
Whether subordinates negotiate to perform activities beyond the formal job description
In Group
Out Group
more information, influence, confidence & concern from Leader
more dependable, highly involved & communicative than out-group
less compatible with Leader
usually just come to work, do their job & go home
Researchers found that high-quality leader-member exchanges resulted in:
Less employee turnover
More positive performance evaluations
Higher frequency of promotions
Greater organizational commitment
More desirable work assignments
Better job attitudes
More attention and support from the leader
Greater participation
Faster career progress
Leadership Making
Suggests that a leader should develop high-quality exchanges with all of her or his subordinates, rather than just a few.
Three phases of leadership making which develops over time:
(a) stranger phase
(b) acquaintance phase
(c) mature partnership phase
Interactions within the leader-subordinate dyad are generally rule bound
Rely on contractual relationships
Relate to each other within prescribed organizational roles
Experience lower quality exchanges
Motives of subordinate directed toward self-interest rather than good of the group
Leadership Making Phase II: Acquaintance
Begins with an “offer” by leader/subordinate for improved career-oriented social exchanges
Testing period for both, assessing whether the subordinate is interested in taking on new roles
leader is willing to provide new challenges
Shift in dyad from formalized interactions to new ways of relating
Quality of exchanges improve along with greater trust & respect
Less focus on self-interest, more on goals of the group
Leadership Making Phase I: Stranger
Marked by high-quality leader-member exchanges
Experience high degree of mutual trust, respect, and obligation toward each other
Tested relationship and found it dependable
High degree of reciprocity between leaders and subordinates
May depend on each other for favors and special assistance
Highly developed patterns of relating that produce positive outcomes for both themselves & the organization
Leadership Making Phase III:
Mature Partnership
Benefits of High LMX
preferential treatment
increased job-related communication
ample access to supervisors
increased performance-related feedback
Disadvantages of Low LMX
limited trust and support from supervisors
few benefits outside the employment contract
Applicable to all levels of management and different types of organizations
Directs managers to assess their leadership from a relationship perspective
Sensitizes managers to how in-groups and out-groups develop within their work unit
Can be used to explain how individuals create leadership networks throughout an organization
Can be applied in different types of organizations – volunteer, business, education and government settings
Leadership Making
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