Toward Building a Multilevel Model of Perceived Leader-member Exchange Differentiation

Abstract

To better understand why perceptions of LMX differentiation are detrimental to individual and team performance, we introduce and develop a validated measure of perceived leader-member exchange (LMX) differentiation and then test a multilevel model of perceived LMX differentiation. We conducted three studies. In Study 1, we developed a six-item measure of perceived LMX differentiation and tested its nomological network with individual differences, work attitudes, and behaviors at the individual level using online panel data from 260 Australian employees. In Study 2, we tested the relationships of collective perceptions of LMX differentiation with team processes using data from 21 work teams in South Korea. In Study 3, we examined the impact of individual and collective perceptions of LMX differentiation on individual and team performance, respectively. Our findings highlight that (a) perceived LMX differentiation explains significant variance in individual performance as well as work attitudes and behaviors and (b) perceived LMX differentiation can be aggregated to the team level, and the collective perceptions of LMX differentiation can explains significant variance in team processes and team performance.