Personality, Leader-Member Exchanges, and Work Outcomes

Personality, Leader-Member Exchanges, and Work Outcomes

Harris, Kenneth J

ABSTRACT

Cumulative research has found leader-member exchange (LMX), the quality of the relationships between supervisors and subordinates, to be a significant predictor of a number of important outcomes. However, relatively minimal work has been performed on variables that predict LMX, with even less attention paid to subordinate personality serving as an antecedent. This study tested the relationship between a number of personality variables and LMX. It further examined the potential for LMX to mediate the associations between different personality variables and organizational outcomes. We tested our hypotheses in a sample of 136 lottery workers and found support for the majority of our predictions.

Introduction

The relationship between supervisors and subordinates has received considerable research attention and has been suggested to be one of, if not the most, important relationship for employees (e.g., Manzoni & Barsoux, 2002). Leader-member exchange (LMX) theory has provided a useful framework for examining these relationships and has been the focus of numerous empirical studies (e.g., Gerstner & Day, 1997; Graen & Uhl-Bien, 1995). LMX theory varies from other theories of leadership (i.e., trait leadership theories, contingency theories) in that it assumes leaders differ in the types of relationships they develop with their subordinates. Thus, the unique relationship between a given supervisor and subordinate is the focus of interest.

LMX theory suggests that exchanges (i.e., work and social interaction) take place between supervisors and subordinates. From these exchanges, supervisors form relationships of varying quality with their subordinates. Employees in high quality relationships receive a number of advantages and benefits compared to their counterparts in low quality relationships. These benefits include increased communication, better roles, higher levels of emotional support, and greater access (Dienesch & Liden, 1986; Graen & Scandura, 1987; Wayne, Shore, & Liden, 1997).

Over the past 30 years, LMX research has primarily focused on the outcomes of LMX relationships (Gerstner & Day, 1997). Much less attention has been paid to antecedents. Furthermore, there are very few instances where both antecedents and outcomes have been examined in the same study. In addition, of the few antecedents that have been studied, personality variables have received very little attention. However, with the growing importance of personality in the workplace (e.g., Barrick, Parks, & Mount, 2005), and with the knowledge that personality is likely to play a significant role in LMX relationships (Bono & Judge, 2004), it is important to find out more about these linkages.

As such, the purpose of this study is threefold. First, we want to examine the relationships between three subordinate (member) personality variables (locus of control, need for power, and self-esteem) and LMX quality, and look at the associations between the personality variables and the outcomes of role conflict, job satisfaction, organizational feedback, and supervisor feedback. Role conflict occurs when “two or more sets of role pressures exist in an individual’s workspace, and the compliance with any one of these pressures impedes the accomplishment of another” (Perrewé et al., 2004: p. 142). Job satisfaction is the overall affective evaluation of one’s job (Spector, 1997). Organizational and supervisor feedback refer to the overall quality of feedback received from the different sources (Herold, Liden, & Leatherwood, 1987).

Our second purpose is to investigate antecedents and outcomes of LMX quality in the same study. Third, we want to determine whether LMX mediates the relationships between personality and job outcomes.

Personality Variables

In this study, we examine three personality variables: locus of control, need for power, and self-esteem. These three constructs were chosen based on the distinctiveness of the variables, the fact that each has been shown to be a powerful and important predictor (e.g., Jenkins, 1994; Judge & Bono, 2001), and the overall breadth of coverage of these constructs.

Locus of control

Locus of control reflects the degree to which an individual generally perceives events to be under the control of powerful others (external locus) as opposed to under his / her own control (internal locus) (Rotter, 1966). Individuals with a high internal locus of control view themselves to be in control of events and aspects of their workplace. This internal locus often leads to individuals communicating more and asking for additional communication / clarification about workplace events because they know they are in control, and they will not wait for communication to come to them. Thus, an internal locus of control is likely positively associated with job satisfaction, receiving feedback from the organization and supervisor, and negatively associated with role conflict. Consistent with this notion, previous research has found an internal locus of control to be positively linked to desired job outcomes (e.g., Judge & Bono, 2001).

Need for Power

Need for power represents an individual’s basic desire to lead and influence others to control one’s environment (Jenkins, 1994). Those who are high in need for power take actions to ensure they receive items (i.e., better roles, leadership opportunities, a stronger voice) that are desired at work. Some of the actions taken by individuals higher in need for power include asking for feedback and seeking out information on their performance. For these and other reasons, need for power has also been associated with positive workplace outcomes (McClelland, 1985), and we expect it to be related to increased job satisfaction and feedback, and decreased role conflict.

Self-esteem

Self-esteem is defined as the overall value an individual places on oneself as a person (Rosenberg, 1965). Individuals who value themselves at higher levels (higher self-esteem) have been shown to have higher job satisfaction and experience or focus on more positive aspects of their work (e.g., Judge & Bono, 2001). Additionally, those higher in self-esteem tend to be more receptive of feedback and actively seek it out as they can better handle both positive and negative information from their organizations and supervisors. Based on this information, we predict that:

Hypothesis 1: Internal locus of control, need for power, and self-esteem are negatively related to role conflict and positively related to job satisfaction, organizational feedback, and supervisor feedback.

Leader-Member Exchange

LMX is a dyadic theory that has its roots in role theory (Dienesch & Liden, 1986; Kahn, Wolfe, Quinn, Snoek, & Rosenthal, 1964) and social exchange theory (Blau, 1964; Cropanzano & Mitchell, 2005). LMX suggests that supervisors choose those they like and / or view as strong performers to fill the more important organizational roles. Conversely, the lesser roles are assigned to those subordinates who are less liked or viewed as less capable. Subordinates selected for the more important roles establish close, high-quality LMX relationships with their supervisors, characterized by trust and emotional support (Dienesch & Liden, 1986).

From these high-quality relationships, subordinates receive several advantages including formal and informal rewards, favor doing, ample access to supervisors, and increased communication (Dienesch & Liden, 1986; Graen & Scandura, 1987; Wayne, Shore, & Liden, 1997). On the other hand, subordinates in low-quality LMX relationships have exchanges with their supervisors that reflect low levels of trust and emotional support and few, if any, benefits outside of the formal employment contract (e.g., Dienesch & Liden, 1986).

Predictors of LMX

Compared to studies on LMX outcomes, there have been considerably fewer studies on its antecedents (e.g., Gerstner & Day, 1997). Of the existing studies on antecedents, demographic similarity, perceived similarity, job performance, and liking have received the most attention. Although theory would lead researchers to certain predictions concerning LMX antecedents, surprisingly, the results have been varied. For example, some studies have found that these characteristics are positively related to LMX quality whereas other studies have found that these variables are non-significantly or negatively related. For example, Kinicki and Vecchio (1994) and Martin, Thomas, Charles, Epitropaki, and McNamara (2005) found positive relationships between an internal locus of control and LMX, whereas Phillips and Bedeian (1994) found a non-significant relationship. Phillips and Bedeian (1994) also examined extraversion and found it was positively associated with LMX.

Other studies have examined supervisor-subordinate personality similarity. The findings from these studies have shown that both locus of control similarity and need for achievement similarity were not significantly related to LMX (McClane, 1991), whereas positive affectivity similarity (Bauer & Green, 1996) and need for power similarity (McClane, 1991) were positively related to LMX quality. These inconsistent results, as well as the limited number of personality variables that been examined as antecedents of LMX suggest that further examination is warranted.

Personality Variables as Predictors of LMX.

As noted above, relatively few studies have been conducted that have looked at subordinate personality variables as possible antecedents to LMX. However, both social exchange theory and role theory suggest that aspects of an employee’s (the member’s) personality will impact the interactions between supervisors and subordinates (Bono & Judge, 2004). Specifically, supervisors form higher quality relationships with those individuals who show higher levels of initiative, are more competent and confident, are higher in motivation, and perform better on the job (e.g., Liden et al., 1997; Liden, Wayne, & Stilwell, 1993). The personality variables of internal locus of control, need for power, and self-esteem each tap into different aspects of a subordinate’s motivation, confidence, and initiative and thus would be expected to be positively related to LMX quality. Empirical research by Kinicki and Vecchio (1994) supports this notion for locus of control, as they found a positive relationship between subordinate internal locus and LMX relationship quality. Thus, we predict that:

Hypothesis 2: Internal locus of control, need for power, and self-esteem are positively related to leader-member exchange quality.

Outcomes from LMX

So much research on LMX has accumulated, with the large majority focusing on outcomes, that a meta-analysis (Gerstner & Day, 1997), three literature reviews (Graen & Uhl-Bien, 1995; Liden, Sparrowe, & Wayne, 1997; Schriesheim, Castro, & Cogliser, 1999), and a new book series (Graen, 2004) have been conducted. All five of these research efforts state that positive organizational and individual outcomes are the primary results of high-quality LMX relationships.

These positive outcomes are based on role theory and social exchange theory as subordinates in high quality exchanges receive better roles, increased communication, higher levels of trust, and increased access to the supervisor. Some of these positive outcomes include higher performance ratings, better objective performance, increased organizational commitment, job satisfaction, organizational citizenship behaviors, and decreased turnover intentions (e.g., Gerstner & Day, 1997; Schriesheim et al., 1999; Wayne et al., 1997).

The positive associations between LMX and the outcomes of job satisfaction, organizational feedback, and supervisor feedback are easily conceptualized based on theoretical arguments. However, the association between LMX and role conflict deserves extra attention. As previously mentioned, role conflict occurs when multiple role pressures are present and the pressure to complete one inhibits the completion of the other (Perrewé et al., 2004). Based on social exchange theory, individuals in high quality LMX relationships receive numerous benefits including increased communication, access, and overall support (Liden et al., 1997). These advantages are likely to lessen competing role pressures. If they remain present, subordinates in high quality exchanges should be able to talk with their supervisors to lessen and hopefully eliminate sources of role conflict. Thus, we expect a negative association. Based on these arguments and the extant research, we predict:

Hypothesis 3: Leader-member exchange quality is negatively related to role conflict and positively related to job satisfaction, organizational feedback, and supervisor feedback.

Leader-member Exchange as a Mediator

Our previous hypotheses, when combined, set up a logical question related to LMX potentially mediating the relationships between the three personality variables and the outcomes in this study. Research has previously shown that personality leads to positive organizational outcomes, but we argue that one of the mechanisms through which it does so relates to the ability of certain personality types to lead to higher quality LMX relationships (e.g., Kinicki & Vecchio, 1994). More specifically, individuals who have an internal locus of control or who are high in need for power or self-esteem are more likely to form high quality relationships with their supervisors, which in turn lead to better job outcomes.

Our reasoning is based on the knowledge that subordinate behaviors can impact valued outcomes, including LMX relationships. Our expectation is that those who believe they control situations, want to lead and influence others, or who value themselves at higher levels will work to improve the quality of their relationships with their supervisors. Individuals know that being in a higher quality exchange will lead to better outcomes (Gerstner & Day, 1997; Schriesheim et al., 1999). Thus, those with certain personality characteristics (an internal locus of control, or a higher need for power or elevated level of self-esteem) that enable them to build higher quality relationships will engage in behaviors that help them achieve this goal.

A similar conclusion is reached with social exchange theory (Blau, 1964; Cropanzano & Mitchell, 2005) as a guiding framework. Specifically, social exchange theory suggests that aspects (traits) of individuals will influence the quality of LMX relationships that are developed, and from better (worse) quality relationships, both parties will experience (or not experience) certain benefits. Based on this logic, we provide LMX quality as an explanatory mechanism through which personality is associated with important outcome variables. Consistent with this line of theoretical reasoning, previous researchers have found LMX to be an important mediator better explaining a number of workplace relationships (e.g., Martin et al., 2005; Wang, Law, Hackett, Wang, & Chen, 2005). Accordingly, we predict that:

Hypothesis 4: Leader-member exchange quality mediates the positive relationship between internal locus of control, need for power, and self-esteem and the outcomes of role conflict, job satisfaction, organizational feedback, and supervisor feedback.

Method

Sample and Procedure

The sample consisted of 136 employees (with a response rate of 34%) of a state lottery in the southeastern United States. The job responsibilities of these respondents included marketing and selling actual lottery tickets. The participants primarily worked in teams and were forced to communicate, work with, and at times rely on their supervisors to complete many parts of their jobs. As opposed to other jobs where the level of supervisor-subordinate interaction is minimal and the work is completed primarily independent of the supervisor, this sample is especially appropriate for examining antecedents and consequences of LMX because our respondents had jobs where the leader-member relationship was integral and important for completing their work.

Of the 136 respondents, 73 were male and 63 were female. The sample contained 72.1% Caucasians and the ages ranged from 22 to 71 with the average age of 44. Organizational tenure averaged 6.77 years and ranged from 1 to 21 years. On average, the employees worked at the lottery forty hours per week.

Employees throughout the state received pen-and-paper surveys with an attached letter that asked for their participation. The letter was written by the lottery director and emphasized accuracy and promptness in completing and returning the questionnaire. Additionally, the director informed the potential respondents that the purpose of the study was developmental, as the lottery was interested in examining leadership at all of the different levels. Respondents were assured of anonymity and completed the survey during working hours. The director sent follow-up emails to all lottery employees two and four weeks after the questionnaires were mailed. Completed questionnaires were mailed directly to the researchers.

Measures

All of the scales were measured on 5-point Likert scales ranging from “1” (“strongly disagree”) to “5” (“strongly agree”). The items in each scale were summed and then averaged to arrive at an overall value for the scale. Higher scores represent higher levels of each of the constructs.

Personality Variables

Locus of Control. We measured locus of control with the sixteen-item scale from Spector (1988). A sample item from this scale was “Most people are capable of doing their jobs well if they make the effort.” Higher scores represent a higher internal locus of control, and lower scores represent a more external locus of control. The alpha consistency for this scale was .87.

Need for Power. Need for power was measured with the five-item scale from Steers and Braunstein’s (1976) Manifest Needs Questionnaire. A sample item was “I strive to gain more control over the events around me at work.” The alpha consistency for this scale was .72

Self-esteem. Self-esteem was measured with the nine-item scale from Rosenberg (1965). A sample item from this scale was “I have a positive attitude towards myself.” The alpha consistency for this scale was .71.

Leader-Member Exchange

Participants completed the 7-item leader-member exchange scale (Scandura, Graen, & Novak, 1986) to measure relationship quality. A sample item was “My supervisor would be personally inclined to use his or her power to help me solve problems in my work.” The alpha consistency for this scale was .89.

Outcome Variables

Role Conflict. We measured role conflict with the eight-item scale from Rizzo, House, and Lirtzman (1990). A sample item from this scale was “I do things that are likely to be accepted by one person and not accepted by others.” The alpha consistency for this scale was .77.

Job Satisfaction. Job satisfaction was measured with Cammann, Fichman, Jenkins, and Klesh’s (1979) three-item scale from the Organizational Assessment Questionnaire. A sample item from this scale was “All in all, I am satisfied with my job.” The alpha consistency for this scale was .88.

Organizational Feedback. Organizational feedback was measured with the 3-item scale from Herold et al. (1987). A sample item was “My organization is a useful source of information about my job performance.” The alpha consistency for this scale was .83.

Supervisor Feedback. We measured supervisor feedback using Herold et al.’s (1987) 3-item scale. A sample item was “My supervisor consistently provides me information about my job performance.” The alpha consistency for this scale was .93.

Analyses

To analyze whether or not mediation existed, we followed Baron and Kenny’s (1986) three-step procedure. First, the independent variables should be significantly related to the mediator variables. Second, the independent variables should be related to the dependent variables. Finally, in the third step, the mediating variables should be related to the dependent variables with the independent variables included in the equation. If the first three conditions hold, at least partial mediation is present. If the independent variable has a non-significant beta weight in the third step, and the mediator remains significant, then full mediation is present.

Results

Means, standard deviations and intercorrelations between study variables are provided in Table 1. As can be seen, the intercorrelations between the three personality variables ranged from -.375 to .431. In general, these correlations show that although the three personality variables are somewhat related, they are conceptually and empirically distinct and further merit being independently investigated. Table 2 provides the results of our regression analyses testing for mediation.

In determining support for hypotheses 1, we turn to the correlation matrix in Table 1. As can be seen, an internal locus of control was negatively related to role conflict, positively related to organizational feedback, moderately positively related to supervisor feedback, and not significantly related to job satisfaction. Need for power was significantly related to all four of the dependent variables in the predicted directions. Self-esteem was negatively related to role conflict and positively related to the other three outcomes. In total, these results provide support for 11 of the 12 relationships predicted in hypothesis 1. The only one not supported was the predicted positive relationship between an internal locus of control and job satisfaction.

Table 1 also shows that both an internal locus of control and need for power were positively related to LMX, whereas self-esteem was not significantly related to relationship quality. These results provide partial support for hypothesis 2.

As for the outcomes of LMX, our findings show that the exchange quality was negatively related to role conflict and positively related to job satisfaction, organizational feedback, and supervisor feedback. These results provide full support for hypothesis 3.

Finally, we turn our attention to the mediation hypotheses predicted in hypothesis 4. Step 1 of the three-step approach for mediation examines the relationship between the personality variables and LMX. Internal locus of control and need for power were significantly related to LMX, but the relationship between self-esteem and LMX was not significant. Thus, we can conclude at this point that the relationships between self-esteem and outcomes were not mediated by LMX.

In step 2, we found that an internal locus of control was significantly related to all of the outcomes except job satisfaction and that need for power was significantly related to all of the dependent variables. Except for the non-significant relationship between an internal locus of control and job satisfaction, these results allow us to proceed to the third step in our mediation test (Baron & Kenny, 1986).

Finally, step 3 showed that with locus of control and LMX in the regression equation at the same time (see Table 2), LMX fully mediated the relationships between locus of control and organizational and supervisor feedback and partially mediated the locus of control-role conflict relationship. When need for power and LMX were in the regression equation at the same time (see Table 2), the results provided evidence that LMX fully mediated the need for power-supervisor feedback relationship and partially mediated the relationships between need for power and the other three outcome variables. In total, these results show that LMX fully or partially mediated three of the four locus of control – outcome relationships and all four of the need for power – outcome relationships. Thus, hypothesis 4 is partially supported.

Discussion

There were three goals of this study: to examine the relationship between three subordinate personality variables and LMX quality, to examine antecedents and consequences of LMX quality in the same study, and to investigate whether LMX mediates the personality-outcomes relationships. We found that all three of the personality variables and LMX were significantly related to the outcome variables. This is important as our sample was somewhat unique (lottery workers) and passing this “first test” (Baron & Kenny, 1986) enabled us to test our mediation hypotheses.

In terms of extending the previous knowledge base, our finding that an internal locus of control and need for power were positively, significantly related to LMX showed the importance of examining the association between these variables. This study contributes to the extant literature by showing how personality variables are associated with either better (or worse) supervisor-subordinate relationships. Thus, this study provides tentative evidence that it is not just a subordinate’s work ethic, initial performance, or likeability that leads to higher quality LMX relationships, but it is also the impact of different subordinate personality variables.

Employees should be wary of this finding, as it may be that aspects of their personality in the workplace (Liden et al., 1997) ultimately contribute to their establishing lower or high quality relationships. Additionally, our findings are consistent with the abundant extant literature that has shown that LMX is positively related to desired outcomes (e.g., Gerstner & Day, 1997; Schriesheim et al., 1999).

Additionally, the finding that LMX quality mediates some of the relationships between personality and important outcome variables is noteworthy. Practitioners and academics alike have given increased attention to personality in the workplace and the many positive individual and organizational outcomes that are associated with certain personalities (e.g., Judge & Bono, 2001). Our study provides evidence that, in many cases, personality variables are not directly related to job outcomes. Instead, it may be the ability of individuals with certain personality characteristics to form high (or low) quality supervisor-subordinate relationships that, in turn, lead to desired consequences. This finding has managerial applications for decision-makers that will be discussed in our practical implications section.

Directions for Future Research

The results of this study lead to a number of avenues for future research. First, it would be helpful for future researchers to investigate this study’s relationships in other samples to provide evidence (or a lack of evidence) related to the external validity of our results. Additional studies employing different samples will help to establish boundary conditions and show if our results from a samples of lottery workers are the same for other groups. In particular, we think that future research with samples from public organizations, military employees, and more white-collar workers would provide generalizability insights. Further, the sample size in this study was relatively small, so future studies with a larger number of respondents would be useful.

Another avenue for future research is to investigate supervisor personality and/or supervisor perceptions of LMX quality. In this study we examined all of the variables from the same source, using the same method, a research design which causes potential concerns (Spector, 2006). However, common method / source issues should actually minimize the chances of finding mediation effects. A fully mediated relationship means that the independent variable, which was measured from the same source and method, is no longer related to the outcomes with the mediator in the equation. As such, we view this as a strength of this paper. Nonetheless, we hope future researchers will measure these variables with designs that minimize or actually eliminate common method and source concerns.

In addition, we invite future researchers to examine other personality variables. In this study, we examined three important personality constructs (locus of control, need for power, and self-esteem) that have been shown to be related to important individual and organizational outcomes (e.g., Judge & Bono, 2001; McClelland, 1985). However, there are a number of others that are of interest in the workplace. Specifically, core self-evaluations (Judge & Bono, 2001), conscientiousness, self-efficacy, self-monitoring (Barrick et al., 2005), political skill (Ferris et al., 2005), and affectivity levels seem especially well suited for similar studies.

Along similar lines, research efforts that investigate other potential mediators of personality – outcome relationships would help to shed light on the specifics of these relationships. As shown in this study, it might often be the case that the linkage between personality and outcome variables is more fully explained by examining intermediate variables that help to explain why personality is related to important outcomes (not just that it is).

Additionally, future studies should explain other potential relationships between variables of interest in this study. In particular, subordinate personality variables may serve as moderators of LMX-outcome relationships and either buffer the negative outcomes associated with low quality exchanges or enhance the positive outcomes connected with high quality LMX relationships.

Finally, additional studies that examine both antecedents and consequences of LMX quality in the same study would help to better explain the dynamics of the supervisor-subordinate relationship (Gerstner & Day, 1997). In so doing, the researchers would also be able to test for the potential of LMX to mediate other “established” relationships (e.g., Martin et al., 2005). In particular, it would be valuable to investigate if LMX mediates the outcomes associated with psychological states, employee empowerment, and relationship-building activities at the workplace.

Practical Implications

One practical application of this study’s results relates to managers potentially benefiting from using selection tests. By identifying personality traits that are associated with desired individual and organizational outcomes, decision-makers can utilize more appropriate selection devices when hiring employees. In this study, we found that an internal locus of control, need for power, and self-esteem are all associated with positive consequences. Thus, an easy and efficient way to improve job outcomes may be to better select those candidates with desired characteristics in the recruiting process. When considering the low cost of using these tools, many of which (including the ones from this study) are free for public usage, and the minimal time involved, it seems likely that managers could benefit from using them in the selection context.

Another implication relates to improving supervisor-subordinate relationships. Previous research efforts have demonstrated the efficacy of LMX training programs for supervisors (e.g., Graen, 1989). For example, Graen found that supervisors can be trained to improve their communication, listening, and feedback skills. In addition, supervisors can be coached or taught to be more supportive of subordinates and to show them greater respect. All of these actions have the cumulative effects of increasing the quality of relationships with each of a supervisor’s subordinates, and of leading to more leader-member exchanges being characterized as “high-quality”.

While the above suggestion relates primarily to supervisors, our study also provides evidence that should be of interest to organizational decision-makers with regard to what they may do in order to enhance LMX relationship qualities for subordinates. Specifically, if managers can focus on and improve personality variables that are associated with LMX, overall exchange qualities may likewise be improved. Thus, decision-makers may benefit by investing in training and / or development activities that help their employees have higher levels of need for power or self-esteem, or more internal loci of control.

In conclusion, personalities will always be brought to work, and they will continue to exert strong influences on organizational phenomena. As the supervisor-subordinate relationship has been suggested to be one of the most important predictors of outcomes for employees (e.g., Manzoni & Barsoux, 2002), it is important to know the profound impact that employee personalities may have in relationship development and the resulting valued outcomes. This study has helped broaden our knowledge base on these vital subject matters.

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Kenneth J. Harris

Ranida B. Harris

David M. Eplion

Indiana University Southeast

Copyright Institute of Behavioral and Applied Management Jan 2007

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