1. Leader-Member Exchange Theory (LMX)
Question: what is the relationship between leaders & followers & how does that affect response?
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Multiple-Linkage Model
Leader-Member Exchange (LMX) & Vertical Dyad Linkage (VDL)
Team Task

2. Multiple-Linkage Model (Yukl, 1994)
Recognizes complexity in formal organizations
Incorporates other theories
Leaders have short (tactical) and long term (strategic) impact
Short term relies on skillful correction of deficiencies of intervening variables in the work unit
Long term relies on leader changing situational variables to be more favorable (e.g., strategic planning, policy formation, program development, organizational change, political activity, etc. )

3. Short-term
Long-term
Extent to which these are appropriately used will reflect the leader’s success

4. Yukl’s Multiple Linkage Model

5. Modification of Yukl’s Model
Leader Variables
Leader characteristics
Modification of Yukl’s Model
Personal power
Technical
Cognitive
Social
Personality
Motivation
Values
Expert
Reference
Connection
Individual /group behavior, capabilities & performance
Influence
Directive
Contingent
Ach-oriented
Persuasive
Facilitative
Supportive
Participative
Delegative
Essential Outcomes
Secondary outcomes
Leader
behavior
Task role clarity
Task proficiency
Motivation & effort confidence
Teamwork & cohesion
Professional conduct
Resilience
Direct
Mission success
Member well being & commitment
Internal integration
External adaptability
Professional image & reputation
Trust & confidence in Ldr
Support for the Ldr
Analysis
Intent formation
Indirect
Position power
Task, group, system, institution & environ. characteristics
Legitimate
Reward
Coercive
Information
Ecological
Uncontrollable factors
Resources
Structures
Procedures
Climate and culture
Strategic capabilities
Professional attributes
External relationships
Responsibilities
Constraints
Opportunities
Situational Variables

6. Vertical Dyad Linkage (VDL) / Leader-Member Relations (LMX)
Think of a work/team situation in which there have been an “in-group (close to the boss) and “out-group” (well established but just not given those special tasks)
How what influenced the formation of those two groups?
What did the boss expect of each group? How did s/he treat them differently?
What were advantages and disadvantages of being in each group?
How did the groups perceive each other?
What was the effect on the work environment & relationships?

7. Vertical-Dyad Linkage (VDL) Leader-Member Exchange (LMX)
(Dansereau, Cashman, & Graen, 1973)
While most leadership theories account for the impact of leadership on groups or the organization as a whole, Leader-Member Exchange Theory uniquely focuses on the Leader-Follower dyad.
Not every follower is treated the same by the leader due to time and resources. This differential treatment, expectation, and exchange separates followers into two groups: the “in-group” and “out- group”
Interaction varies from dyad to dyad, exchanging privilege for performance, & focuses on quality of interaction
Negotiating latitude: as relationship evolves, the leader enables the role incumbent to further define his/her own role
Perceptions of the “out-group” when LMX is not going well

8. The Role theory of Katz and Kuhn (1966)  is the original theoretical base of the LMX (Graen, 1976). Leaders accomplish their work through role sets, in which the leader is most influential. The leader communicates to the member a set of expectations regarding the appropriate role behavior of the member (role expectation). The member then receives and interprets these sent expectations (received role) and may modify his or her role behavior. Finally, the member's role behavior transmits feedback to the leader (monitored behavior). Burns and Otte (1999) describe the three stages:
Phase 1: Role-taking as leaders and members come to understand how the other views and desires respect, the leader communicates role expectations to the member, with no reciprocal contribution from the member.
Phase 2: Role-making is the trust that develops in order for leaders and members to further extend the relationship and influence over each other's attitudes and behaviors. Both contribute to role re-definition and this is where in/out work groups are differentiated
Phase 3: Role-routinization of the social exchange pattern becomes established and routine 

9. Leader-Member Exchange (LMX) Vertical-Dyad Linkage (VDL)
Comply with basic role requirements
Accept legitimate direction
Standard benefits and compensation
Perceived
Equity or Inequity
Inside information
Influence decisions
Task assignment
Job latitude
Support
Attention
Unstructured tasks
Volunteer extra
Additional responsibilities
Special projects
Alienation
Apathy
Hostility
Low performance
Other Subordinates--
Viewed as having less potential, interest, or opportunity
Subordinate
Leadership potential
Competency
Compatibility
Agreement
Personality
Loyalty
Commitment
“In-Group”
“Out-Group”
High----Negotiating Latitude-----Low
High Power Leaders give more negotiating latitude to high power employees)

10. Strengths & Weaknesses of LMX
Strengths of LMX
As a descriptive theory, it notes the importance of the existence of in-groups and out-groups within an organization
The LMX theory is unique as the only leadership theory that makes the the dyadic relationship the central factor of the leadership process
LMX directs our attention to the importance of leadership communication and relationships
Research substantiates how the practice of the LMX theory is related to positive organizational outcomes

11. Weaknesses of LMX
The LMX theory runs counter to basic human belief in fairness: It gives the appearance of discrimination against groups that don’t receive the special attention
The basic ideas and theory are not fully developed: details of compatibility of personality, interpersonal skills, how trust is developed, etc., are not presented or discussed how important they are compared to other constructs
Few empirical studies have used dyadic measures to analyze the LMX process
Measurement scales lack content validity (may lack what they intended to measure) and unclear whether they measure single or many dimensions

12. What makes a good “follower”?

13. Team Discussion
Pick a case you are familiar with that involves in/out group dynamics
Use the theory to analyze what went well/not well and why
If you were a trainer or consultant to this leader, write out a series of recommendations about what should be changed to improve the situation (consider selection criteria for subordinates, how in/out groups are framed, equity issues, opportunities to break into the in-group, dealing with alienation, etc.)