43. Vertical Dyad Linkage (LMX) Theory
Leaders develop different relationships over time with different subordinates
Some subordinates are given greater influence, authority, and tangible benefits in exchange for greater loyalty, commitment, and assistance
The “in-” and “out-groups”
Tips for productive use of in-groups
- Pick in-group members based on competence and contribution to the organization
- Periodically evaluate your criteria for in- and out-group membership
- Assign tasks to best person regardless of group membership
- Maintain fluid groups where movement in and out is possible
- Set clear performance-related guidelines for in-group membership
- Whenever possible avoid highly differentiated in-and out-groups
LMX more descriptive than prescriptive because does not specify what pattern of downward exchange relationships is optimal for leadership effectiveness
Theory not clear about the desirability of having sharply differentiated in-groups and out-groups
Weaknesses: How are in-group members selected? Not clear regarding the relationship between effective relationships, leader behavior, and outcomes.
Tony’s comment: Leaders develop different relationships with their individual subordinates, resulting in “in” and “out” groups. The nature and size of the “in” group affects leadership success.