Worked example 1
A project manager gives two trusted engineers early access to plans and flexible deadlines, while contractors receive only standard briefs and close monitoring. Contractors complain of unfair treatment. Analyse using LMX and French & Raven.
Show solution outline
LMX: Engineers are in-group — high exchange quality, mutual trust, informal influence. Contractors are out-group — transactional, low discretion. This predicts higher commitment and performance from in-group but resentment and turnover risk from out-group.
French & Raven: Manager uses legitimate (formal role) and coercive (monitoring threat) power over contractors; reward and referent power with engineers who identify with the manager's vision.
Followership: Engineers show exemplary followership (critical thinking + engagement); some contractors may become alienated (low engagement, high criticism).
Evaluation: LMX explains favouritism's effects but does not justify unfairness — organisations need procedural justice. High LMX for a few can harm team cohesion (see 4.3.3). Expert power should extend to any skilled contractor, not only favourites.