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Who wouldn’t enjoy working with leaders who offer incentives for hard work?!?! When it comes to being rewarded for achieving individual and/or group goals, leaders who make the road to success easier for followers to travel tend to generate increased follower satisfaction and performance (Northouse, 2016). Whether followers value a supportive, warm, and friendly leader, one who provides structure, guidance, and clarity, autonomy and integration, or one who challenges and pushes followers to exceed expectations—the path-goal theory of leadership consolidates each of these to allow a leader to adapt their behaviors to any situation (Northouse, 2016). Path-goal theory allows leaders to fluidly shift behaviors to meet the needs of followers while providing coaching and incentives, encouraging followers to set and smash goals successively (Northouse, 2016).
The path-goal theory’s ability to produce follower satisfaction and increased productivity depends on the leader’s ability to identify the needs of the followers, provide incentives to motivate and keep them motivated, and for the leader to adapt their behaviors to the situation and the followers’ needs… all with the goal of propelling followers towards success in mind (Northouse, 2016). Sounds pretty complicated, right?
When considering what real-life situations the path-goal theory would work best in, one comes to mind. Sales. In a sales environment, the goal of the group collectively is to sell and to sell more this month than what was sold last month, sell more this year than what was sold last year, and so on. Sales quotas are a goal that sales teams attempt to reach monthly. An individual monthly quota might be to sell on average, $107 per transaction. A collective quota within one regional branch might be for the team to sell on average, $115 per transaction. These monthly sales quotas offer a short-term goal that with effort and motivation, the goal can be achieved.
Motivational factors that come into play when helping members of the sales team achieve their monthly quota might be a weekly commission earning of 10% of the total transaction for any transaction over $120. Sometimes, the general manager offers a monthly incentive for the team members (followers) such as individual flat rate bonuses of $100 for each $10 increment a sales average goes above $107. As many people know, money is quite the motivator, so an additional incentive might address the group collectively, offering the sales team opportunities to win large yearly bonuses of $500, $1,000, or $2,000 for each individual on the team if the sales team achieves having the highest sales averages for the region. Participating in competitive team incentives such as this, where teammates of one branch compete with another branch, can improve an organization’s performance while also improving individual self-competencies, performance, and enhances motivation levels by learning from experiences month to month (Farhan, 2018).
Another type of motivation for individual team members would be an opportunity to advance to a management position if sales averages are high enough ($120 average for 6 consecutive months), offering individuals who achieve this goal the opportunity to participate in a fast track to management program. When advancement is offered as an incentive, an individual receives their own branch, a moving allowance of $5,000 to help offset the cost of moving, the first two months of rent or mortgage in the new area paid for by the organization, full coverage medical, vision, and dental insurance paid for by the organization, and an annual salary of $55,000 plus yearly bonuses. These types of incentives have the potential for motivating an otherwise lazy team member to become the top sales member in the region!
Now, let’s consider the path-goal theory, team members, and their needs for a moment. Assume that the characteristics of 3 team members and their individual needs from leadership behavior are as follows:
· Andrea is a team member that is assertive, she knows what she wants—to be a manager. She works hard, is highly self-motivated, driven to succeed, is 4 months into a $120 sales average, and she wants to be admitted into the fast-track program. Andrea prefers structure to help her achieve her goals, needing occasional updates on her progress, and only needs to guidance along these last few steps before she enters into management; she needs directive leadership on an as needed basis as she is aware of her own abilities in the workplace (Northouse, 2016).
· Joe is a team member that is dedicated to the work he performs, enjoys learning, and also has 4 months in with a $120 sales average, however, he does not desire to move on to managing his own branch yet. He currently wishes to learn more from his current manager so that he better knows how to handle future management situations independently and wants to be sure he has a good grasp on the ins-and-outs of the business. He wants to be in complete control of his branch when he moves on. Joe has a desire for control and has an internal locus of control; he needs participative leadership (Northouse, 2016).
· Michael is a team member who is currently struggling with meeting his monthly sales quotas and currently has a $100 sales average. He has made friends with everyone on the sales team and enjoys spending time with them in and outside of work. He responds well to the manager showing him one-on-one attention and support, often pulling his sales average above $107 during the month after such guidance, but his average falls again in the following month. This rollercoaster of ups and downs with his sales average has been going on for 6 months now and he feels that if he was meant to keep his job, God will help him pull his sales average up; if his average doesn’t stay up next month, he feels that this job just wasn’t meant to be, though he hopes that it is as he loves the work he performs. Joe has needs for affiliation with supportive, concerned leadership; he believes in external dimensions of control and he himself lacks desire for control for which he needs directive leadership in addition to supportive leadership (Northouse, 2016).
Task characteristics within this sales environment are repetitive and team members perform the same tasks each day, every day (Northouse, 2016). The repetitive nature of the tasks performed by the team members, a teammate such as Michael may need additional support and motivation to complete his work, raise his sales average, and keep it at or over $107 (Northouse, 2016). If the formal authority of the manager was strong, leadership would be detrimental to Michael and other team members as the leader would likely offer no assistance or guidance and he may not have survived beyond a month or so in such an environment (Northouse, 2016). However, because the formal authority is weak, the manager’s leadership offers support for Michael and his teammates, makes sure that expectations are clear, and helps to remove obstacles from the path to success for the team members, providing all the necessary tools they need to reach their goals most of the time (Northouse, 2016).
For members such as Michael who needs more support, the learning theory can enhance the effectiveness of the path-goal theory of leadership to support not only an individual’s development but also the group’s development (Farhan, 2018). The manager of the sales team above could incorporate learning theory by communicating the importance of shared knowledge and experiences—encouraging the team to strengthen effectiveness with members such as Andrea or Michael learning leadership skills to help members such as Michael when the manager is unable to consistently offer him (or others) one-on-one support (Farhan, 2018). Not only would Andrea and Michael learn necessary leadership skills which are needed for the development their own professional leadership styles, but other members within the branch (and organization) would establish a learning culture where teammates work together to strengthen communication, share information and knowledge, and improve their abilities to work together through difficulties (Farhan, 2018). Essentially the path-goal theory would combine with learning theory to allow the team to become self-supportive, capable of helping one another reach goals and increase their earnings of monthly and yearly bonuses as a result (Farhan, 2018). A win-win for everyone!
To summarize, the path-goal theory of leadership approaches leadership in a way that customizes the leader’s approach to each individual follower’s needs concerning motivation and involvement to ensure that the follower’s journey to success (reaching their goals) is as straight-forward as possible (Northouse, 2016). The removal of obstacles along the way is another responsibility of the leader, however, as we’ve seen in the examples above, followers such as Michael may require consistent one-on-one support which is not easily accomplished with a number of followers in a team environment. Learning theory can be incorporated and used simultaneously with the path-goal theory to enhance the capabilities of followers in a team environment, encouraging communication, learning how to share knowledge (particularly the knowledge of more developed followers/teammates who are on their way to leadership positions of their own), to become self-sufficient collectively, and capable of providing support and motivation to one another to achieve goals (Farhan, 2018). The path-goal theory alone develops leaders who help followers confront obstacles, efficiently work around and through them, and guide followers toward goal attainment and long-term success.
References:
Northouse, P.G. (2016). Chapter 6: Path-goal theory. Leadership theory and practice. Thousand Oaks, CA: SAGE. pp. 115-136.
Farhan, B.Y. (2018). Application of path-goal leadership theory and learning theory in a learning organization. The journal of applied business research, Vol. 34, No.1. pp. 13-22. Accessed September 28, 2018, from https://search-proquest-com.ezaccess.libraries.psu.edu/docview/2082228501?pq-origsite=summon&accountid=13158