nt of objectives (Hersey & Blanchard, 1996).
Through the application of situational leadership theory, leaders influence organizational performance through the actions of subordinates. Lord and Maher (1991) extended situational leadership theory to included considerations both the direct and indirect effects of leadership on organizational performance. Within this context, direct effects refer to "those leadership activities which explicitly influence the behavior of subordinates or the strategies of organizations" (Lord & Maher, 1991:169). Indirect effects involve "establishing certain conditions, such as socialization processes or culture, which then affect subordinate and organizational performance" (Lord & Maher, 1991:171). Indirect effects in this conception of situational leadership are as important as are direct effects.
Sven Lundstedt (1975) said that leadership "is the ability to influence the behavior of others in a group or organization, set up goals for a group, formulate paths to the goals, and create some social norms in the group" (p. 164). The path-goal theory developed by Robert House is based on the expectancy theory of motivation. The leadership task is viewed as guiding workers to choose the best paths for reaching goals. This theory is based on goal setting theory and holds that leaders must engage in different types of leadership behavior depending on the nature and demands of the particular situation (House, 1971). Thus, path-goal leadership theory is not divorced entirely from situational leadership theory.
In the application of path-goal leadership theory, a leader helps subordinates to attain goals by providing the direction and support needed to ensure that the goals pursued by subordinates are compatible with those of the organization.
Path-Goal theory assumes that leaders are flexible and that they can change their style, as situations require. The two contingency variables are enviro...