Leader Member Exchange Theory(Lmx)

LEADER MEMBER EXCHANGE THEORY (LME)
Leader-member Exchange (LME) flows from literature on transformational leadership, extant in the 1970s. A number of fundamental concepts are quite old, such as rewards for supporting leadership being as old as political philosophies from Classical Greek days. The formalization of LME stems from the term "Vertical Dyad Linkage (VDL), a concept developed by Dansereau, Graen, and Haga in 1975, with their paper, "A Vertical Dyad approach to leadership within formal organizations".
Leadership is one of the primary areas of study, research, and practice in organizational behavior. Leaders often develop relationships with each member of the group that they lead, and Leader-Member Exchange Theory explains how those relationships with various members can develop in unique ways.
The leader-member exchange theory of leadership focuses on the two-way relationship between supervisors and subordinates. These are not the only 2. Also known as LME, LMET or Vertical Dyad Linkage Theory, leader-member exchange focuses on increasing organizational success by creating positive relations between the leader and subordinate.
In particular, leaders usually have special relationships with an inner circle of assistants and advisors, who often get high levels of responsibility and access to resources. This is often called the “in-group,” and their position can come with a price. These employees work harder, are more committed to task objectives, and share more administrative duties. They are also expected to be totally committed and loyal to their leader. Conversely, subordinates in the “out-group" are given low levels of choice or influence and put constraints on the leader.
These relationships start very soon after a person joins a team and follows these three stages:
1. Role-taking: The member joins the team and the leader evaluates his or her abilities and talents. Based on this, the leader may offer opportunities to demonstrate capabilities.

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