This field study investigated the relationship among behavioral and perceptual measures of the Leader-Member Exchange (LMX) relationship and organizational outcome variables. The major purposes of this study were to determine: (1) the extent to which the dyad is the appropriate level of analysis for the examination of manager-subordinate relationships, (2) which objectively observed managerr behaviors are important in defining negotiating latitude, the most commonly used measure of LMX, and (3) whether these behaviors or traditional self-reports of negotiating latitude better predict organizational outcome variables.

Two hundred ninety-two manager-subordinate dyads from 18 work groups in a manufacturing plant were observed by trained research assistants and completed questionnaires. Measures included observed manager behaviors defined by the Operant Supervisory Taxonomy and Index (OSTI), subordinates' absence rates, and managers' and subordinates' perceptions of subordinates' satisfaction (general satisfaction, satisfaction with supervisor, growth satisfaction, work satisfaction, coworker satisfaction), subordinate's intent to withdraw, and negotiating latitude (NL).

Within and between analysis I (WABA I) indicated the manager-subordinate dyad as the appropriate level of analysis for NL, general satisfaction, satisfaction with supervisor, growth satisfaction, work satisfaction, coworker satisfaction, and turnover intent. WABA II revealed significant dyadic relationships between NL and all measures of satisfaction as well as turnover intent.

Bivariate regression analysis revealed a significant relationship between negotiating latitude and absenteeism. Multiple regression analysis showed manager behaviors (i.e., antecedents) predicted negotiating latitude. However, multiple regression failed to reveal that manager behaviors predicted measures of satisfaction, turnover intent, or absenteeism.

Finally, hierarchical regression revealed that manager behaviors (i.e., consequences) added to the predictive ability of negotiating latitude for general satisfaction. However, the addition of manager behaviors to negotiating latitude using hierarchical regression failed to produce a significant change in R-square for any other outcome variables.