Abstract
Drawing from the recent theoretical development in social hierarchy, we theorize that whether leader-member exchange (LMX) differentiation breeds status conflict and ultimately undermines team performance hinges on the alignment between LMX differentiation and acyclicity. Based on data collected from 89 work teams in mainland China, we found that only when LMX differentiation was misaligned with acyclicity, LMX differentiation was positively related to status conflicts and, as a result of it, undermined team performance. In contrast, when LMX differentiation was aligned with acyclicity, LMX differentiation was negatively related to status conflicts and consequently promoted team performance.
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