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) theory describes the role making process between and leader and an individual subordinate In addition, the theory describes how leaders develop different exchange relationships over time with various subordinates

Initial Version of LMX Theory • The basic premise of the theory is that leaders develop a separate exchange relationship with each individual subordinate as the two parties mutually define the role of the subordinate • The exchange relationship usually takes one of two different forms. o Most leaders establish a special exchange relationship with a small number of trusted subordinates who function as assistants, lieutenants, or advisors o The exchange relationship with the remaining subordinates is substantially different • Over time, the dyadic exchanges follow a different developmental sequence for each subordinate

In the low-exchange relationship there is a relatively low level of mutual influence o To satisfy the terms of low exchange relationship the subordinates need only comply with formal role requirements:  Duties  Roles  Standard Procedures  Legitimate directions from the leader o As long as such compliance is forthcoming, the subordinate receives the standard benefits for the job (SALARY) High exchange relationship o Basis => The leader’s control over outcomes that are desirable to a subordinate o Examples:  Assignment of interesting and desirable tasks  Delegation of greater responsibility/authority  More sharing of info  Participation in making some of the leader’s decisions  Tangible rewards – pay increase/special benefits  Personal support and approval  Facilitation of the subordinate’s career o In return for greater status, influence and benefits, a high exchange subordinate has additional obligations and costs:  Expectation to work harder  Be more committed to task objectives  Be loyal to the leader  Share some of the leader’s administrative duties o The development of high-exchange behavior relationships occurs gradually over time, through reciprocal reinforcement of behavior as the exchange cycle is repeated over and over again o High exchange relationships create obligations and constraints for the leader  Provide attention to the subordinates  Remain responsive to their needs and feelings  Rely more on time consuming influence methods – persuasion/consultation

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loyalty and respect are developed 3. Leader and subordinate evaluate each others motives. The exchange relationship is refined and mutual trust. there will be: o More supportive behavior by the leader o More consultation and delegation o More mentoring o Less close monitoring o Less domination of conversations For the subordinate: o More organizational citizenship behavior o More support for the leader o More open communication with the leader o Less use of pressure tactics (threats/demands) to influence the leader The early research found that a leader’s upward dyadic relationship affects downward dyadic relationships A manager who has favorable exchange with the boss is more likely to establish favorable exchange relationships with subordinates A favorable upward relationship enables a manager to obtain more benefits for subordinates and to facilitate their performance by: o Obtaining necessary resources o Cutting red tape o Gaining approval of changes desired by subordinates • • • • Page 2 of 9 . o Mutual role expectations are established o Some relationships never make it beyond this stage 2. attitudes. Exchange based on self interest is transformed into mutual commitment to the mission and objectives of the work unit Measurement of LMX • Quality of exchange relationship is usually assumed to involve such things as: o Mutual trust o Respect o Affection o Support o Loyalty Sometimes LMX is defined to include: o Negotiating latitude o Incremental influence o Shared values o Individual attributes of leader and subordinate • Research on Correlates of LMX • • A favorable relationship is more likely when the subordinate is perceived to be competent and dependable and the subordinate’s values and attitudes are similar to those of the leader When the exchange relationship is favorable. and potential resources to be exchanged.Extended Version of Theory • • New version => described in terms of life cycle model Three Stages: 1.

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The subordinate has no prior history of poor performance 2. There is evidence indicating external causes The type of attribution made by a manager influences the response to the problem When an external attribution is made the manager is more likely to respond by trying to change the situation by : o Providing more resources o Providing assistance in removing obstacles o Providing better info o Changing the task to reduce inherent difficulties o By showing sympathy • • • Page 4 of 9 . The subordinate performs other tasks effectively 3. The subordinate is perceived to have other redeeming qualities (popularity/leadership skills) 7. The manager is dependent on the subordinate for his or her own success 6. The subordinate has offered excuses or apology 8. The subordinate is doing as well as other people who are in a similar situation 4. The effects of failures or mistakes are not serious or harmful 5.Evaluation of LMX Theory and Research • Early versions of the theory did not adequately explain: o How dyadic relationships develop over time o How the leader’s different relationships affect each other o How differentiated relationships affect overall performance by the leader LMX theory has been almost exclusively about vertical dyadic relationships Leader-Member exchange is a universal theory with little concern for situational variables that may affect the exchange process Some aspects of the situation that are likely to be relevant include: o Demographic attributes of the work unit members o Job characteristics o Work unit characteristics o Type of organization • • • LEADER ATTRIBUTIONS ABOUT SUBORDINATES • Attribution theory describes the cognitive processes used by leaders to determine the reasons for effective or ineffective performance and appropriate reaction Two State Attribution Model • • • Stage One – The manager attempts to determine the cause of poor performance Stage Two – The manager tries to select an appropriate response to correct the problem Managers attribute the major cause of poor performance either internally or externally to the subordinate o Internal – Lack of effort or ability o External – Beyond control of subordinate  Inherent obstacles  Inadequate resources  Insufficient info  Other people provided inadequate support An external attribution is more likely when: 1.

poor performance is attributed to external causes for high exchange member and to internal causes for a low exchange member Impression Management by Followers • • • • Many different types of impression management tactics have been identified One useful distinction is between defensive tactics used to justify weak performance and proactive tactics used to elicit respect and affection from others Defensive tactics include: Excuses and apologies Proactive tactics include ingratiation and self promotion o Ingratiation – the effort to appear supportive. but it should be done in a way that will preserve a favorable relationship or improve a relationship that is already strained Page 5 of 9 . appreciative and respectful  Examples: • Doing personal favors • Offering help • Providing praise • Expressing agreement with the person’s ideas • Taking an interest in the individual’s personal life o Self Promotion – the effort to appear competent and dependable  Examples: • Talking about your past achievements • Playing up your contribution to successful activities • Demonstrating effective behavior when you know the person is watching • Arriving to work early • Most studies find a positive correlation between ingratiation by a subordinate and affection of the boss for the subordinate Applications: Correcting Performance Deficiencies • Corrective feedback may be necessary to help a subordinate improve.• When an internal attribution is made and the manager determines that the problem is insufficient ability the likely response is: o To provide detailed instruction o Monitor the subordinate’s work more closely o Provide coaching when needed o Set easier deadlines o Assign the subordinate an easier job Attributions and LMX • • • Leaders appear to be less critical in evaluating the performance of subordinates with whom they have established a high exchange relationship Effective performance is more likely to be attributed to internal causes for a high-exchange members and to external causes for a low-exchange member In contrast.

Ask the person to suggest remedies 9. Gather information about the performance problem o Timing – when did the problem occur. because a subordinate is usually reluctant to admit mistakes 8. Mutually identify the reasons for inadequate performance • Personal causes of inadequate performance are harder to detect than situational causes. Reach Agreement on specific action steps 12. Express confidence in the person 10. Explain the adverse impact of ineffective behavior 6. Summarize the discussion and verify agreement Page 6 of 9 . Describe the deficiency briefly in specific terms 5. how serious were they o Antecedents – What led up to the problem. what was the subordinate’s involvement o Scope – Did the problems occur only the subordinate or did others have the same problems? 2. Stay calm and professional 7.• Guidelines for Correcting Performance Deficiencies: 1. Provide corrective feedback promptly 4. Try to avoid attributional biases o Internal causes for poor performance usually involve low motivation or deficiencies in subordinate skill and examples include: • Failure to carry out a major action step on schedule • Failure to monitor progress to detect a problem before it becomes serious • Showing poor judgment in dealing with a problem • Procrastinating in dealing with a problem until it gets worse • Failure to notify superiors about a problem that requires their attention • Making an avoidable error in the performance of a task • Failure to follow standard procedures • Acting in an unprofessional or improper manner 3. Express a sincere desire to help the person • Examples: o Help the person identify and express concerns and feelings o Help the person understand the reasons for a personal problem o Provide new perspectives on the problem o Help the person identify alternatives o Offer advice on how to deal with the problem o Refer the person to professionals who can provide assistance 11. how many times o Magnitude – what were the negative consequences.

skills or behaviors Implicit theories are developed and refined over time as a result of: o Actual experiences with leaders o Exposure to literature about effective leaders o Other social-cultural influences Some differences in implicit theories are likely among countries with diverse cultures Implicit theories are important because they influence the expectations people have for leaders and their evaluation of the leader’s actions Implicit theories about effective leadership determine the perceived relevance of various types of leader behavior A leader who is liked or perceived to be effective may be rated higher on behaviors in the ideal prototype than on behaviors not in the prototype. regardless of the leader’s actual use of the behaviors • • • • Page 7 of 9 . and  There is a long delay before leader actions affect performance • Implicit Leadership Theories • • • Implicit Leadership Theories – beliefs and assumptions about the characteristics of effective leaders The implicit theories usually involve stereotypes and prototypes about relevant traits.FOLLOWER ATTRIBUTIONS AND IMPLICIT THEORIES Determinants of Follower Attributions • • Several interrelated factors determine how followers assess leader effectiveness Factors: o The extent to which there are clear timely indicators of performance for the leader’s team or organization o Leaders actions  Leaders who take direct actions that appear relevant get more credit for performance improvements than leaders who do not  Direct actions that are highly visible to followers influence attributions more than indirect actions  A leader who acts decisively to resolve an obvious crisis is considered highly competent • Conversely a leader who fails to take direct action in a crisis or whose action has no apparent effect is likely to be judged incompetent o Intentions versus Competence  Followers assess whether leader is more concerned about personal benefit or career advancement than about their welfare and the team’s mission  Credibility is increased when the leader expresses strong and persistent convictions about the need for change and explains it is necessary without exaggerating the benefits or ignoring the costs Attributions are more likely to be biased when there is little info available to judge the competence of the leader o It is more difficult to assess leader competence when:  There are no reliable indicators of organization performance  There is little opportunity to observe the leader’s actions.

and proactive • Some of the qualities that contribute to leadership effectiveness (self-confidence. Take initiative to deal with problems Keep the boss informed about your decisions Verify the accuracy of information you give the boss Encourage the boss to provide honest feedback to you Support leader efforts to make necessary changes Show appreciation and provide recognition when appropriate Challenge flawed plans and proposals made by leaders Resist inappropriate influence attempts by the boss Provide upward coaching and counseling when appropriate • • • • • • • • • SELF MANAGEMENT • Self Management – a set of strategies a person uses to influence and improve his or her own behavior Self-Management Strategies 1. also make a leader prone to excessive ambition. optimistic thoughts and avoiding negative pessimistic thoughts • Mental rehearsal How Leaders Encourage Self-Management • • Some theorists believe that the primary role of the leader is to help subordinates develop skills in self management Leadership activities include: o Explaining the rationale for self management o Explaining how to use behavioral and cognitive self-management strategies Page 8 of 9 . or righteousness • Followers can help the leader avoid these excesses • Rather than complaining about the leader followers should help the leader to do better Applications – Guidelines for Followers • Find out what you are expected to do o It is difficult to be viewed as competent and reliable if you have role ambiguity and are unsure what you are expected to do.FOLLOWER CONTRIBUTIONS TO EFFECTIVE LEADERSHIP The Effective Follower • Effective followers are courageous. strong convictions. risk taking. responsible. a passion for change). Behavioral – useful when you need to push yourself to do something you are reluctant to do o Self-reward o Self-punishment o Self-monitoring o Self-Goal Setting o Self Rehearsal o Cue Modification 2. Cognitive – help you build self-confidence and optimism about doing a difficult task • Positive self talk – emphasizing positive.

• • o Encouraging efforts to use these techniques o Providing enough autonomy to make self-management feasible Empowerment of self managed subordinates offers a number of potential advantages including: o Stronger task commitment o Faster resolution of local problems o Better customer service o Reduced administrative costs o More opportunities for leadership development Empowerment can reduce group performance if people do not agree about objectives and priorities Page 9 of 9 .