Leader-Member Exchange Theory AGED 3153

Good leaders develop through a never-ending process of self-study, education, training, and experience. ~ Manual on military leadership

Overview LMX Theory Approach Perspective LMX Theory Approach Perspective Early Studies Early Studies Later Studies Later Studies Phases in Leadership Making Phases in Leadership Making How Does the LMX Approach Work? How Does the LMX Approach Work?

LMX Theory Approach Description Focuses on interactions between leaders and followers Focuses on interactions between leaders and followers First described in 1975 by Dansereau, Graen and Haga, and Graen and Cashman First described in 1975 by Dansereau, Graen and Haga, and Graen and Cashman Changed the idea that followers are a group and looks at followers as individuals Changed the idea that followers are a group and looks at followers as individuals

LMX theory Conceptualizes leadership as a process centered in the interactions between leaders and followers Dyadic relationship is focal point of leadership process Dyadic Relationship

L S TheVerticalDyad Vertical Dyads Vertical Dyads – –Focused on the nature of the vertical linkages leaders formed with each of their followers   leader forms unique relationship with each subordinate Early Studies

Linkages In-group/out-group status based on: In-group/out-group status based on: – –how subordinates involve themselves in expanding their role responsibilities with the leader – –how well subordinate works with the leader – –how well the leader works with the subordinate Becoming part of the in-group involves subordinate negotiations in performing activities beyond the formal job description

VDL Described 1. Willing to do more 2. Demo. innovativeness 3. Get more responsibility 4. More opportunities 5. Get time/support from leader 1. Operate strict to prescribed roles 2. Do only what is required 3. Get fair treatment but no special attention 4. Get standard benefits

Linkages L S L SIn-Group L S L SOut-Group is high-quality relationship 0 is stranger

Later Studies Addressed how LMX theory was related to Addressed how LMX theory was related to organizational effectiveness – –Related to positive outcomes for leaders, followers, groups and the organization Researchers (Graen & Uhl-Bien, 1995) found that high-quality leader-member exchanges resulted in: Researchers (Graen & Uhl-Bien, 1995) 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

Current Studies Focus on how leader-member exchanges can be used for leadership making Focus on how leader-member exchanges can be used for leadership making – –Emphasizes high-quality exchanges with all subordinates Leaders create networks of partnerships throughout the organization   benefits organizational and personal goals/progress Occurs over time through 3 phases   Stranger   Acquaintance   Mature partner

Phase 1 Graen & Uhl-Bien (1995) Interactions rule bound Rely on contractual relationships Relate to each other within prescribed organizational roles Experience lower quality exchanges Subordinate motives directed toward self-interest

Phase 2 Graen & Uhl-Bien (1995) Offer by leader/subordinate for improved career-oriented social exchanges Testing period of taking on new roles and leader providing new challenges Shift from formalized interactions to new ways of relating Quality of exchanges improve along with greater trust and respect Less focus on self-interest, more on goals of the group

Phase 3 Graen & Uhl-Bien (1995) High-quality LMX exchanges High degree of mutual trust, respect, and obligation toward one another Tested relationship that is dependable High degree of reciprocity May depend on each other for special assistance Highly developed patterns of relating that produce positive outcomes

Phases of Leadership Making

How Does the LMX Theory Approach Work?

LMX Theory Approach Describes leadership Describes leadership Essential to recognize existence of in-groups & out-groups – –how goals are accomplished – –Relevant behavior differences Prescribes leadership Prescribes leadership –Best understood within leadership making model –Leaders should:  create special relationships with all subordinates  treat every subordinate equally  nurture high-quality exchanges with all subordinates  focus on ways to build trust

What are strengths of LMX theory approach?

What are weaknesses of LMX theory approach?

How do we apply the LMX theory approach?