This article is based on Leader-Member Exchange (LMX) theory which deals with the dyadic relationship between the superiors and subordinates in the organization. It emphasizes on providing adequate resources, required support and information to subordinates, that would help them to better understand the organizational values and goals. The job and life satisfaction of subordinates is mediated through a quality exchange of implicit knowledge by the leaders. This article discusses the importance of the human resource practices to be initiated for fostering dyadic relationship to sustain organizational effectiveness.

Achieving organizational success depends upon many human resource practices. One such HR practice is improving the quality of vertical exchanges among those dyads that are more important in sustaining organizational growth and development. Most of the dyadic relationship in organizations between the leader and their followers are strictly contractual. They stick to norms, rules and regulations of the organization thereby limiting employee's involvement to the basic necessity.

Existing organizational design may not be adequate in prescribing formally, the expected behavior and performance of its members at all times. Subsequently, there is always a possibility of employee disengage-ment with the job and organization as well. This kind of problems can be effectively handled through the concept of vertical exchanges, where the leader goes for choosing the members, develop a close and supportive relationship beyond formally prescribed by virtue of their positions in the organization. This kind of special social relationship will cultivate additional commitment and make the members go beyond the contractual obligations in achieving the organizational goals.

The concept of vertical exchange deals with providing members with attention, support, information and other resources. In turn, it is expected that the members will reciprocate with commitment and involvement beyond their contractual terms.

HRM Review Magazine, Contractual Expectations, Leader-Member Exchange Theory, Organizational Goals, Corporate knowledge, Organizational Citizenship Behavior, Business Operations, Employee Development Program, Induction Programs, Intervention Program, Transformation Process, Organizational Learning, Management Policies, Organizational Commitment.