MGT 125 Chapter Notes - Chapter 1: Job Satisfaction, Ingroups And Outgroups, Transactional Leadership
Document Summary
Leader-member exchange theory: the leadership theory that states that leaders create in- groups and out-groups, and that those in the in-group will have higher performance ratings, less turnover and greater job satisfaction. The strategy categorises leaders as being either in" or out". Leaders encourage lmx by rewarding those employees with whom they want a closer linkage and punishing those whom do not. However in order for their relationship to remain intact, both the leader and follower must invest time in it. In-group members have a demographic, attitude, personality and even gender similarities with the leader, or they have a high level of competence than out-group members. The key is that the leader does the choosing, but the followers characteristics create the basis for the decision. Transactional leaders: leaders who guide primarily by using social exchanges or transactions. They motivate their followers to work towards established goals by exchanging rewards for their productivity.
