CHAPTER 3: EXCHANGE &RELATIONSHIP

Interaction between the components involved in a leadership As soon as an organization has been set up, an interaction between a leader and the followers/subordinates will be developed according to stages.

Building of a relationship
Starts as soon as a person joins a team which a leader has been chosen. Related torole formation process. Involved tpree stages; 1. Role Taking o Members join a team and the leader evaluates their abilities and talents o Opportunities may be offered to demonstrate capabilities 2. Role making o The leader and members take part in an unstructured and informal negotiation to delegate roles that comes with benefit and power. o Important phase to build trust among leader and follower o Involved relationship factors; o Personal/formal characteristics similarity o Gender o Culture o Race

3. Routinisation
Establishing an ongoing social exchange between the leader and member o Positive attitude: empathetic, patient, reasonable, sensitive to the other people's view o Negative attitudes: aggression, sarcasm, self Centered view

LEADER-MEMBER EXCHANGE THEORY (LMX) Also known as The George Graen Vertical Dyad Linkage Theory(1975) Examines the relationship and role making process between a leader and an individual follower. Describes how leaders develop different exchange relationships over time with various subordinates Relationships were developed early in the leader/follower relationship

Concept Leaders will establish individual and mutually exchanged relationships with those in a subordination position but most don't treat all followers the same way. Factors:

o Perceived competence o Dependability o Personal compatibility

- According to the LMX theory, followers or subordinates fall into two different categories.

In-Groups Leaders establish a special exchange relationship with a small group of subordinates. Have certain responsibilities and obligations beyond those required of others. Gain greater access, high degree of mutual dependence, influence and favour to theJeader Typically considered the trusted advisors, assistants or lieutenants of the leader. Expected to work harder, to be more committed, to be loyal and share leader's duties. Within this relationship both the leader and subordinates mutually gain more personal power because of reciprocal trust and respect for each other.

Out-Groups,
The exchange relationship with the remaining employees. Lack the Has a low Get fewerpecial relationship available to the "in-group". level of favour or mutual influence with the leader, opportunities and treated as less motivated Treated li|<e they are not committed/motivated to their job or to performance. Must comply with formal role requirements only (duties, standard procedures, legitimate direction) Strengths of the theory Descriptive, suggests that it is important to recognize the existence of in-groups and out-groups within a group or organization Unique Decause it's the only leadership approach that makes the concept of the dyadic relationship the centerpiece of the leaders!-tip process Directs the attention to the importance of communication in leadership Proven by a large body of research that have related thetheory to positive organizational outcomes

Weaknesses of the theory Concept is the opposite to basic human values of fairness The basic ideas and theory are not fully developed 4 Questions regarding the measurement of leadership member exchanges in LMX theory Conclusion of the theory It is important that every follower is respected like a valued member of the team. They should be able to thrive in an environment of equal opportunity where their skills are evaluated because of their competence rather than because of obvious favouritism.

Recommendation
The leader should develop quality relationships with all members. Make everyone feel like they're in the in-group Phases of social growth: 1. Stranger phase- rule bound, low quality exchanges 2. Acquaintance phase- testing, sharing more resources and personal/work related information 3) Mature relationship phase- mutual trust, respect toward each other A favorable relationship is more likely when the subordinate is perceived to be competent and dependable, and the subordinates values and attitudes are similar to those of the leader. A favorable exchange relationship:

More consultation & delegation Less close monitoring More organizational citizenship More support of the leader More communication with the leader

Leads to:
Higher job satisfaction, stronger commitment, better performance

DEVELOPMENT

Leader development: focuses on the development of the leader Personal attribute desired ways of behaving ways of thinking ways of feeling Typically, leader development has focused on 3 main areas -providing the opportunities for development, stimulating the ability to develop and providing a supportive cor text for change to occur.

Leadership development: focuses on the development of the leader

interpersonal relationships social influence process team dynamics contextual factors social network linkages

Leadership development can build on the development of individuals (including followers) to become leaders. In addition, it also needs to focus on the interpersonal linkages between the individuals in the team. The success of leadership development efforts has been linked to three variables:. i Individual learner characteristics Ii The quality and nature of the leadership development program Iii Genuine support for behavioural change from the leader's supervisor