Path-Goal Theory of Leadership - Assignment Example

CASE STUDY OF MANAGEMENT By (Name) Name of Class (Course) Professor (Tutor) Name of Institution (University) City and State The Date Introduction The leadership style of a company manager or leader can either positively or negatively affect the business (Geithner, 2007). Different company leaders have different leadership traits and viewpoints. This study focuses on two leaders with different leadership styles but are very successful. The first one is the founder of Virgin Group, Richard Branson and the other, Terry Gou founded Foxconn. Terry Gou is quite controversial with strict rules and regulations while Richard Branson is positive and democratic in his leadership. This paper will look at how these leadership styles affect employee performance, motivation and the creation of a better work place with regard to the different theories and ideas of leadership behaviors and styles. Question 1. Richard Branson Richard Branson has a clearly defined leadership style that is full of vision, positivity and trust. His leadership styles can be argued to be partly laissez-faire and partly democratic. Leaders using democratic leadership styles involve the employees in suggestions and ideas for improvement and to some extent in the decision making process (Northouse, 2007). They do away with hierarchies and employees are in control of what they do in the company. In the case study, Richard Branson believes that workers have to operate in an ever changing environment, need to be empowered to act and need to make decisions. His leadership Approach also includes supporting his employees, treating them with respect and delegating tasks. Laissez-faire leadership style is where the leaders gives the employees total freedom to make their own decisions but provide the necessary answers and materials if needed (Goethals, et al., 2004). Richard Branson shows this leadership style where he sets a ‘non-policy’ on holidays where the employees can take time off and go on holiday whenever they want, he also encourages and allows them to make their own decisions since he pays them to be their own leaders and not to follow. As much as some scholars concluded that the latter leadership style is ineffective compared to other styles (Lewin, 1939), it seems to work for him as he owns one of the most successful businesses in the world. Terry Gou This owner of Foxconn, on the other hand has a very different and controversial leadership style. He undoubtedly uses an autocratic leadership style where he dictates work methods, centralizes authority, limits employee participation and makes unilateral decisions (Northouse, 2007). His factory staff are sometimes required to do full day shifts (24 hours) or sometimes have to wake up as early as 4 am to meet urgent orders. The workers have some benefits but the pressure on them is constant. He dictates work methods where he pushes for more production and better performance but with low pay and long hours of work. They have forced overtime and boring repetitive jobs, they are to some extent being treated like machines. His centralized authority and unilateral decision making comes in where he does not share new product launches with the staff; he does not have clear consultations with the workers. The workers are controlled tightly and jobs are done with military style strictness. As much as this style of leadership may be working for him since he is still successful, this work environment is not conducive for any employee as it can be compared to slavery. The company has even had over ten counts of suicides with more workers threatening to do the same. Question 2. The Path-goal leadership theory is a leadership model that is based on having a specific leadership behavior or style that fits the work and staff environment so as to achieve a goal or an objective (House & Mitchell, 1974). This is in order to boost worker motivation, satisfaction and empowerment which will eventually make them to be productive members of the organization. This theory can be regarded as a process where leaders choose certain behaviors which are best suited to the needs of the employees and the working environment. This is done in order to best guide the employees through that path to reach their goals (Northouse, 2013). According to House (1971), the four path-goal theory leader behaviors include: One, Directive where the leaders inform their followers on what they are supposed to do and how to do it. It also involves the coordination and scheduling of work. Two, supportive where the leader shows concern for the workers by being friendly and approachable and in the process making the work environment pleasant for them. The third one is participative and here the leader discusses and makes consultations with the employees before coming to a conclusion or decision. Achievement is the last one and here the manager puts up challenging goals for the employees and expects them to perform to their level best. The leader also shows confidence in their employees’ ability to meet these goals. Richard Branson’s leadership evidently showcases two of these path-goal leadership behaviors and these are supportive and participative. The Virgin Group founder has managed to create a very pleasant work environment by supporting the employees and encouraging them to be independent in making decisions. He believes that employees come before customers and if well taken care of, they would do the same for the customers. He believes that is workers quit their jobs it should be because their jobs do not satisfy them and not because they are not paid well. Participative behavior comes in where he consults and interacts with his workforce. He believes in getting rid of barriers and sharing ideas. He believes such interactions with employees keep them motivated and efficiently apply their skills in areas he is not proficient in. Terry Gou’s leadership mostly has directive behavior. He has strict work schedules and the workers are always given instructions on what to do and when to do given tasks. The jobs are coordinated and scheduled and the employees have to strictly adhere to these rules or lose their jobs. The leader makes decisions secretly and then later gives instructions on what is to be done. He does not have any clear discussions or consultations with workers. Question 3. Positive motivation in the workplace is very important as it increases productivity and eventually helps in meeting business objectives. Richard Branson’s leadership style is the best for employee motivation as a democratic leader because it encourages team involvement, participation and engagement. Each and every employee is acknowledged and honored (Goethals, et al., 2004). Work environments with this type of leadership regularly results in employees who are motivated and full of morale to come up with creative solutions. It also provides an environment of team spirit and cooperation. Richard Branson encourages his employees to set goals and notes their success and achievements. He also encourages them to grow while at the same time supports them in their endeavors. Branson permits workers to share their views and ideas before making decisions, this is satisfactory to the employee as he or she feels like part of the business and as such are motivated to work to their level best (Northouse, 2013). He has managed to wield this leadership style effectively and it has created a dynamic work atmosphere with motivated workers that are eager to succeed. This supportive and participative leadership behavior is based on the expectancy theory of Vroom (1964), that states that an individual will act according to what he or she expects to be the outcome of the action and how important that outcome is to that individual. Richard Branson believes that his actions would yield the best results for his organization which is actually the case. Terry Gou’s autocratic leadership style has its own advantages but mostly to the business; his workers are negatively affected by this type of leadership to the point that some end up committing suicide. However, it can be argued that the fact that Foxconn Industries is a fast paced work environment where quick decisions have to be made for the daily tasks and the autocratic leadership style would work best here. The employees are expected to be confident and derive motivation from the leader’s ability to successfully run the organization (Northouse, 2013). At Foxconn industries, the positive motivations are less than the negative motivation which is the threat of losing their jobs if targets are not achieved. In this type of leadership employees are motivated by setting highly structured rewards, threats and punishments. Terry Gou’s leadership style is also derived from the motivation theory of expectancy where he expects his actions to produce the best and highest possible outcome. Question 4. Terry Gou’s leadership style is extremely stressful, hazardous and toxic to the employees. There are various recommendations that can be given to him in order to create a better work environment for his employees. First, I would advise him to review the working hours and pay the workers according to the amount of work done; workers at Foxconn are known to work for extreme hours and sometimes do not get the required days off. This could lead to exhaustion and eventually less productivity or even quitting the job. In order to do this, the company will have to employ thousands of more employees. Secondly, he should pay his workers sufficiently; the workers reported that their salaries are not enough to cover their basic needs and this could also lead to dissatisfaction and poor performance. Lastly, he should consult and discuss with his employees about all the present changes or future plans. New policies that allow workers to provide input to the management through the appropriate structures should be put in place. The Chinese business culture can however affect these changes since most of the Chinese companies are in the manufacturing industry that require large amounts of output. The company leaders end up being autocratic as they see this as the best way to maximum production (Northouse, 2013). As much as these leaders know that they have to give their employees some level of decision making power, they know they would have to deal with a long history of benign authoritarianism. Chinese leaders consider the global perspective of leadership as an inhibition to outstanding leadership, they believe that great leaders remain faithful to Chinese traditions, as much as they may agree to partner with other countries, they still remain loyal to their values and demonstrate national pride. Such thoughts may influence the success of these recommended changes. Conclusion Terry Gou and Richard Branson have two very different leadership styles which have lead them to their success. However, Branson’s leadership is more positive and employee minded leading to happy and satisfied employees and less turnover. As much as Gou’s leadership style has contributed to his success, it has brought about a lot of criticism and scrutinization from different human rights organizations and the media. His leadership has even led to suicides of employees. If he wants some peace of mind, Terry Gou should use better a better democratic leadership style. As much as he has to lead over 900,000 employees, a consultative democratic leadership style would still work and probably achieve better results. Reference List Geithner, C. A., 2007. Understanding leadership styles. (2nd Edn). Monterey: Healthy Learning. Goethals, G. R., Sorenson, G. J., & Burns, J. M., 2004. Encyclopedia of leadership. [Online]. Available at: http://www.credoreference.com/book/sagelead. [Accessed 02 May 2017]. House, R.J. & Mitchell, T.R., 1974. Path-goal theory of leadership. Journal of Contemporary Business. 3(1), pp l–97. Lewin, K., LIippit, R. & White, R.K., 1939. Patterns of aggressive behavior in experimentally created social climates. Journal of Social Psychology, 10 (4), pp. 271-301. Northouse, P. G., 2007. Leadership: theory and practice. (5th Edn). Thousand Oaks: SAGE Publications. Vroom, V.H., 1964. Work and motivation. (1st Edn). New York: Wiley. Read More