Case Study Ldrs 801

Trapped in the
Sixties
A STUDY IN PATH GOAL LEADERSHIP THEORY
DEIDRE BRADLEY AND BODIE WEISS
LDRS 801: THEORETICAL FOUNDATIONS OF

LEADERSHIP
BRENT J. GOERTZEN, PHD
DECEMBER 5, 2014
Theoretical Foundations
Bradley and Weiss, 1
of
Leadership
Case
Study
and
Teaching
Notes
Trapped in the Sixties

HHH Manufacturing is a well-established Midwestern business with a 50
year history. Started by Harvey H. Hatfield in the late 1960s, HHH produces
plastic eating utensils for fast food restaurants. With the growth in the fast
food industry, HHH had done well. They produced millions of basic white
plastic knives, forks and spoons, usually packaged together. However, in
recent years, a number of competitors have begun to erode HHH market
dominance. Further, the variety of restaurant franchises had increased and
each desired unique plastic cutlery for their establishments. There were
demands for new colors, new designs and rumors of something called a
spork.
On some level, Harvey Hatfield understands that his company would
need to change in order to remain competitive, but he believes that his
company has thrived by making basic white styrene cutlery. Hatfield and the
board were convinced that this product would remain the foundation of the
business. (The board is comprised of several business associates and
several of the original members of the company including Buddy Holly,
Ritchie Valens, and J.P Big Bopper Richardson.) Hatfield was sometimes
heard paraphrasing Henry Ford by saying, Customers can have their forks in
any color they like, as long as they like white.
The company has a traditional corporate structure. At the head of the
company is Hatfield who serves as CEO. The executive board consists of
several business partners who meet approximately three times each year.
of
Leadership
Case
Study
and
Teaching
Notes
The board projects sales based on last years results and uses these
projections to determine the annual budgets for each department with the
expectation that the management team will stay within those boundaries.
This budgeting authority determines the wages paid and all operational
costs. The executive board members do not completely trust each other.
Davy Jones is the chairman of the board and very good friends with Hatfield.
Jones is very engaged and seeks to get to know all the employees in the
company. He shows up two or three times a week just to see how things are
going and the employees really appreciate his gestures of getting to know
them. Unfortunately, the other board members do not share the same vision
or style as Jones. They are concerned about the close relationship that Jones
has with Hatfield and other members at the plant. Some of the board
members suspect there may be shady business practices going on.
Day-to-day operations are coordinated by a management team
consisting of head manager Bob Dylan and two associate managers, Joan
Baez and Jimi Hendrix. The management team has been with HHH industries
almost since its inception and has earned their position because of their
longevity with the company. The management team, like all members of
HHH Manufacturing, are paid based on their tenure with the company.
Regular cost of living increases are provided to all employees, but other
raises (performance or merit) had not happened in several years. (Early in
their history, Hatfield had granted across-the-board annual raises that were
of
Leadership
Case
Study
and
Teaching
Notes
tied to particularly profitable years. However, as their sales continued to

decline, these raises had not happened in many years.)
Aside from the other issues, the role of the Human Resources Director
has been vacant for over one year. The board could not agree on any
candidates. The salary ranges are out of sync with the market rates,
employee morale is at an all-time low and compliance issues are piling up.
The management team has no formal training related to employee relations
and the rumors about organizing a union are widely circulating. Turnover
rates have tripled in the last year, there is high absenteeism and employees
are getting injured almost weekly.
Because Hatfield is rarely at the facility, Dylan has de facto oversight
of the entire operation. He is responsible to Hatfield and the board members,
but they only seek his feedback occasionally. Dylan often speaks with Jones
because of Jones frequent visits to the plant. Dylans primary contact with
the board is his yearly report for the annual audit and business forecast
board meeting, although, again, he does see Jones during Jones visits.
Dylan also serves as the supervisor for the sales and administrative team.
Baez and Hendrix report to Dylan on an informal basis, but there is no
formally recognized method of supervision.
Baez primarily focuses on design and marketing, while Hendrix
oversees production. The Baez team does market research and then designs
a template that is given to the production team. If the idea is approved, it is
sent to Dylan for final approval. If the idea is considered unfeasible or
of
Leadership
Case
Study
and
Teaching
Notes
unprofitable by the production team, it is sent back to the design team for
redesign. This process could be lengthy and frustrating because there is no
formal coordination between the two teams. Further exasperating the
situation is the lack of input by the sales team into the design process. The
sales team is presented with a set of products and told to promote them.
Like all other members of HHH, salespeople are paid strictly on a salary
basis. They are responsible for making cold calls and following up on leads.
Further, because the sales group operates more as individuals than as a
team, each has their own set of clients, which results in overlap between
chains and types of operations.
While Hatfield understands that the company is not as profitable as it
once was, he believes that it is doing acceptably. Dylan, Baez and Hendrix,
on the other hand, are not so convinced. The regular trickle of comments
from the sales staff indicates that the company is not competitive. There are
a number of employees who are updating their profiles on LinkedIn.
Many of these issues are quickly building to a crisis level, especially in
light of the impending audit. Every three years the plant must go through a
quality audit. The auditors will be showing up on-site without warning at any
time. If they do not pass this audit, they will have to shut down all
operations until each citation has been addressed. To make matters worse,
the company will not only have to correct any problems but they could face
huge fines. Because of the lack of oversight, there are also some question as
to the employees use of the company credit cards and a negative finding
of
Leadership
Case
Study
and
Teaching
Notes
could jeopardize the companys operating line of credit. Rumors are

circulating that the plant will not pass the audit and many are a fearful
because they could be out of a job very soon.
These impending pressures recently led to a frank exchange of views
between Hatfield and Jones. Prompted in part by the concerns of the board
members, Hatfield challenged Jones relationship with the workers at the
plant and his frequent visits. Jones responded by explaining that he believed
that the company needed on-site leadership which could provide direction
and guidance. He told Hatfield that his role as a board member demanded
that he knew the people who were working for him and what they needed to
get the job done. Jones continued by mentioning the lack of morale at the
company and the lack of adequate compensation which was exasperated by
company policy and the lack of an HR Director. Hatfield angrily responded to
Jones challenge. He told him the Monkees were a Beatles rip-off, threw a
Spork at him, and ordered him out of his office. After Jones left, Hatfield sat
alone in his office surrounded by his collection of antique plastic ware.
Inwardly, Hatfield realized that things were not well. Some things had to
change.
Part II: Initial Issues Observed

1.
There are a number of challenges the company faces that are external
in nature such as changes in casual dining and an increase in
competition.
2.
of
Leadership
Case
Study
and
Teaching
Notes
However, within the company, there are a number of specific issues

that have been building over the long-term.
3.
Initially, the companys organizational structure complicates decisionmaking and implementation. The board, including the founder of the
company, seem to have checked out and perform only cursory
oversight. Other than to simply maintain their operation, there seems to
be no clear goal for the company.
4. The lack of trust between leadership is evident in the situation with

Jones. The board does not share the same understanding of involvement
in the companys day to day operations.
5.
Beyond the board, there are significant issues with communication

between the departments and there are no clear lines of responsibility.
The division of departments greatly hampers their ability to respond to a
changing market and discourages innovation.
6. Further, the structure of employee compensation and position

advancement has no obvious ties to performance.
7. The use of company credit cards is troublesome and is directly tied to the
lack of responsibility.
8. The employees have no real incentive to do more than is required.
Discussion Questions
1.
How does the current structure of the company promote or hinder the
companys profitability? Please support your answer with examples from
the case study narrative.
2.
of
Leadership
Case
Study
and
Teaching
Notes
What are some of the specific structures, rules and procedures that are
hindering the growth of HHH Enterprises? How could the leadership,
specifically (1.) Harvey Hatfield and the board and (2.) the plant
supervisors, remove the barriers to growth?
3.
Could a general reorganization of the company benefit HHH

Manufacturing? How would an autocratic leader respond to the
companies struggles? Is it possible that HHH currently functions as a
benevolent dictatorship? How would a more beneficial path-goal
leadership style appear?
4.
Should employee compensation be restructured in such a way as to

incentivize the employees? If so, how would this look?
of
Leadership
Case
Study
and
Teaching
Notes
Teaching Notes
1. Objectives of Case
Type of Case
This case demonstrates the common problems of lack of
communication within an organization, an absence of clear company
objectives and the need for leadership to assist members of the
organization in establishing and reaching their goals.
Learning Objectives
Students will:
1) Learn and develop leadership skills and abilities which will
translate into real
life situations.
2) Develop the ability to evaluate and identify specific areas in
which an organization is faltering and how those areas can be
addressed in a positive way.
3) Understand the value of path-goal theory and its practical
application.
Case Description
HHH Enterprises is an established company that experienced
past growth in sales, but lacks the vision/ability to structure the
company to capitalize on that potential. In recent years, the
companys profitability has declined and its long-term viability is in
doubt.
Author(s) Objective
This case was developed to provide students with a clear example of
typical organizational dysfunction that can be largely addressed by
the adoption of Path-Goal theory.
2. Course Information
Intended Course
This case would be appropriate for an undergraduate introductory
leadership class that is examining various leadership theories from a
practical standpoint.
Course Level
Undergraduate
Position in Course
Because an introductory leadership class would address multiple
leadership theories, this class would be best suited for middle to late
in the semester. By this time, students would be comfortable with
basic leadership ideas, would have had some prior experience with
of
Leadership
Case
Study
and
Teaching
Notes
other theories, and would be able to participate in a discussion about

a particular issue. Finally, because participation in the discussion is
such a key element to successful instruction, placement in the middle
or toward the end of the semester would insure that the students
were sufficiently familiar with each other to foster dialogue.
Prerequisite
A basic understanding of leadership principles would be helpful,
hence the placement of this case in the middle to latter parts of the
class. However, it could be used as a stand alone study.
Timeframe/Proposed Session Plan
With a more instructor-centric approach, this lesson could be
accomplished in a 75 minute timeframe; however, because of the
desire to engage the students in discussion and practical application,
150 minutes would be preferable.
Minutes 0-30
Introduction to Path-Goal theory
Minutes 30-35 Introduction of the case
Minutes 35-45 Read through the case
Minutes 45-60 Encourage critical thinking and brainstorming
by
asking the students to identify as many
issues as
possible
Minutes 60-70 Base the discussion questions on the
responses of the
students and identify those areas
that may have been
overlooked by students. Tie
them specifically to
Path-Goal theory and
the ancillary theories of
Transactional
Leadership Theory and Expectancy Theory
Minutes 70-90 Discussion of first issue
Minutes 90-110 Discussion of second issue
Minutes 110-130 Discussion of third issue
Minutes 130-140 Discussion of the fourth issue
Minutes 140-150 Summary and concluding discussion
of
Leadership
Case
Study
and
Teaching
Notes
3. Case Summary
HHH Enterprises is an established company that is faced with
numerous issues. While it enjoyed solid success early in its history,
recent years have not been as fruitful. The company is beset with
issues including the lack of clear corporate objectives, properly
defined leadership and employee roles/responsibilities, adequate
employee compensation and incentives as well as potential issues
with financial regulatory compliance. While there are numerous issues
confronting this organization and several potential remedies, the focus
of this case study is the application of Path-Goal theory to address the
issues confronting HHH Enterprises.
4. Key Issues (list of topics that should be discussed)

Identification of key barriers that keep the company from success.
The role of the board in the operation of the company and the
barriers to success that they have created and/or could remove.
The role of the supervisors in the operation of the company and the
barriers to success that they have built or could remove.
The communication issues between the various teams including
the barriers to success that they have built or could remove.
5. Key Theories (list of relevant theories)
Path-Goal (House, etc.)
Transactional Leadership (Northouse, etc.)
Expectancy Theory (Isaac, Zerbe and Pitts, etc.)
Authority-Compliance Leadership (Northouse)
6. Theoretical Links (literature review)
Issue 1: HHH Enterprises was a profitable enterprise for many years. Over
the years, however, numerous barriers have been created which hamper
continued success. First, among the many barriers is the lack of proper
job descriptions and/or agreed understandings for the role of the board
and management. This is exasperated by Davy Jones interest in the day
to day operations of the company which is at odds with the normal
behavior of the other board members. Secondly, this dysfunction is
mirrored in the lack of understanding of roles and responsibilities between
of
Leadership
Case
Study
and
Teaching
Notes
head manager Bob Dylan and two associate managers, Joan Baez and Jimi
Hendrix. There is no clear delineation of roles and responsibilities.
Thirdly, problems continue to trickle down to employees. The design,
production and sales teams do not work together toward a common goal.
In addition to lack of organizational coordination, there is little
encouragement for productivity and innovation because there is no
financial reward for the employees as their salaries are fixed and raises
are limited to annual cost of living adjustments.
o Path-goal Theory
o Northouse (2007):
Path-goal theory emphasizes the connection between
the leaders leadership style and the situation.
Further, path-goal suggests that employees must
believe they are capable of doing the work, if they
believe it will achieve a successful outcome and if
they believe there is sufficient reward for the
expenditure of their effort.
o House (1971):
House (1971) specifically links follower behavior to
leader motivation. If the leadership is unclear or
disorganized, then it stands to reason that the
followers will mirror that lack of direction. Further,
one of the leaders primary responsibilities is to
remove the barriers to successful employee
achievement. A final aspect of the theory
emphasizes proper reward/compensation as a
motivating factor for employee performance.
o House (1996):
Expanding on his initial theory, House defined
specific leadership behaviors that would benefit an
organization. These behaviors are directive,
supportive, participative and achievement (pp. 326327).
Directive behavior occurs when actions are
directed toward providing psychological
structure for subordinates: letting subordinates
know what they are expected to do, scheduling
and coordinating work, giving specific
guidance, and clarifying policies, rules, and
procedures p. 326).
Supportive behavior is conduct directed
toward the satisfaction of subordinates needs
and preferences, such as displaying concern for
subordinates welfare and creating a friendly
of
Leadership
Case
Study
and
Teaching
Notes
and psychologically supportive work

environment (p. 326).
Participative behavior is behavior directed
toward encouragement of subordinate
influence on decision making and work unit
operations: consulting with subordinates and
taking their opinions and suggestions into
account when making decisions (p. 327).
Achievement behavior includes actions
directed toward encouraging performance
excellence: setting challenging goals, seeking
improvement, emphasizing excellence in
performance, and showing confidence that
subordinates will attain high standards of
performance (p. 327).
o Transactional Theory
Northouse (2007)
Effective leadership is dependent on two or
more people operating in the adult ego state
which means that both are testing reality by
acquiring information and assessing possible
lines of action and their outcome (p. 325).
o Expectancy Theory
Lawler & Suttle (1973)
In order to succeed, an employee needs to
believe in the perceived likelihood that
effort toward a behavior or task goal will lead
to the successful accomplishment of that
goal and that the successful
accomplishment of behavior goal will result
in the securing of outcomes or rewards (p.
483).
of
Leadership
Case
Study
and
Teaching
Notes
Back to the Case: When HHH Enterprises was a new organization,

Harvey Hatfield could run the operation and still be an immediate
presence with the team. While the addition of the board made
sense as the company grew, the roles and responsibilities of that
board were never clearly defined. Jones behavior is seen by some
as subversive, but it is in fact good leadership because it is
directive, supportive and participative (House, 1996). He is
providing the team at the plant with what they desperately need.
The disorganization within the plant simply mirrors the
disorganization of the board. Dylan, Baez and Hendrix are doing
their best in a bad situation, but they lack the power to correct the
situation. Not only is the board not testing reality by acquiring
information and accessing possible lines of action and their
outcome (Lawler & Suttle, 1973, p. 483), the plant supervisors are
in no position to do so without proper authorization. The situation
with the HR personnel is a prime example because they have
neither the authorization nor the ability to fill the vacancy. Dylan,
Baez and Hendrix can be expected to do no more than their
supervisors because they lack organization and there is no
achievement behavior (House, 1996) being provided by Hatfield
and the majority of the board.
The lack of ordered teams and goals also affects their ability
to believe that they will be able to successfully achieve their goals
Issue 2: The role of the Board of Directors in the operation of the company is
very limited. There is a lack of vision on the part of the CEO as well as the
business partners. They do not have a good working relationship with each
other and fail to meet often enough to actually develop any kind of long-term
strategic plan for the business. The Board only projects sales based on the
previous year without a vision of trying to capture the market or at least, try
to change the product line to pursue the next big thing. The Board has
created barriers to the success of the organization by distancing themselves
from the operational site and the employees. They do not meet regularly
and there is high distrust among each of them. This creates uncertainty in
those who follow them. Their lack of visibility has given the impression that
Mr. Jones and Mr. Dylan are truly running the show.
The Board could remove many barriers by first dealing with the internal
issues that they are having. They will need to confront their own lack of
participation as well as the issues they have with Mr. Hatfield and Mr. Jones
being such good friends. The Board will need to decide to meet together
more frequently to discuss true strategic and succession plans for the
of
Leadership
Case
Study
and
Teaching
Notes
company and hold each other accountable. Once those issues have been
addressed, the Board will need to become more involved in the day-to-day
operations and make it a point to visit with the management team and frontline staff. They will be key in determining sales quotas and projections. The
Board will also need to address the need for an experienced HR Director and
make that a priority search. They will need to consider leadership
development for the management team or replacing them if necessary.
o Path-goal Theory
o Wofford and Liska (1993):
Drawing on the work of House, Wofford and
Liska identify path-goal theories as those that
contend that one major function of a leader is
to enhance subordinate expectancies (p. 857).
The leader is tasked with providing coaching
and guidance as well as motivating the
subordinate. Additionally, support and rewards
are a must in order to gain effective
performance from the subordinates.
o House (1996):
House points out that path-goal theory is about
relationships between superiors (formally
appointed) and subordinates in their day-today functions (p. 325). House further notes
that leaders motivate their subordinates by
many factors, including reducing roadblocks,
which increases opportunities for personal
satisfaction (p.325).
House contends that when subordinates have
ambiguity in their role it is both unpleasant and
stressful. Leaders who reduce uncertainty will
lead to satisfaction and effective performance
(p. 327).
Back to the case: HHH Enterprises has enjoyed financial success with
very little problems. Because of the sustainability of their current
products and no major shake-ups within the organization, there has
been no real push to make changes or confront the issues that are
plaguing the executive team. There has been a general attitude of if it
aint broke, dont fix it. However, a new competitor is on the horizon
and their new product is making quite the stir. Times are changing and
the challenge for HHH is to adapt or die.
of
Leadership
Case
Study
and
Teaching
Notes
Due to the lack of a strategic vision among the core leadership team,
HHH is in a perilous position on several fronts. Major areas that need to
be addressed are for the leaders to come together and reduce the
roadblocks keeping the organization from rising to the top. They will
need to reduce uncertainty to lead to satisfaction and effective
performance for everyone involved. (House 1996).
Issue 3: The role of the supervisors in the operation of the company is,
again, very limited. All three of the management team members have been
with the company nearly the entire time the company has been in business.
The board members, as a group, hear from the Head Manager annually. The
structure is set up so that the Head Manager runs the company as he sees fit
without much input from the CEO or any of the board members, with the
exception of one member. The supervisory team is in a silo of sorts as they
stick to their own division. There is no input from those who could make an
impact, such as sales and the front-line staff.
This team has had very little impact on anything other than ensuring things
are getting done. They have not been developed as leaders. Unknowingly,
this management team has not furthered the success of their company by
keeping quiet on the issues going around the plant. Primarily, they do not
have anyone to go to with the exception of Mr. Jones and they do not believe
they can completely trust him to tell him everything going on. The staff
would be more engaged if they would be able to honestly address the issues
that are hampering the business but feel trapped. The supervisors do not
believe they need to rock the boat but rather continue doing what they are
doing in order to get orders out the door. They are satisfied with getting by
and do not believe things will change.
o Expectancy Theory
o Isaac, Zerbe and Pitts (2001)
Expectancy theory explores the need for
leaders to provide reasonably challenging
work for the follower. Additionally, leaders
need to be aware of the capabilities of their
subordinates. If additional training and/or
education is needed, the leader must be
sensitive to those needs and remove barriers
so these can occur.
Isaac, et al, note that all workers wish to feel as
if they make a difference and involved in the
process of the work they do. Leaders must
of
Leadership
Case
Study
and
Teaching
Notes
reinforce the feelings of subordinates so that

they understand the connection of the value
they bring and how it impacts the entire
company.
o Path-goal Theory
o Wofford and Liska (1993):
Wofford and Liska identify path-goal theories as
those that contend that one major function of
a leader is to enhance subordinate expectancies
(p. 857). Leaders must take on the role of a
coach and provide guidance to the teams they
lead. Additionally, they are tasked with
motivating the subordinate with support and
rewards as a way to engage them for optimal
performance outcomes.
Back to the case: The management team has never truly been
involved in the operations other than making sure the work gets out
the door. They have had very little, if any, leadership development
and no mentor providing guidance or coaching to speak of. They do
not feel they matter because nobody, with the exception of Jones,
ever asks their opinions or seeks their input.
Because this team has not been included on some major decisions
affecting their front-line staff, they do not have a sense of how their
performance matters. They lack the drive and motivation to make
major changes because they do not see that the effort will be worth
the time and energy involved to turn things around.
Issue 4: HHH Enterprises is hampered by a sweeping lack of
communication. When the company first began, Harvey Hatfield was able
to handle the management and communication needs by himself.
However, as the company grew, the demands increased. The formation
of a governing board has not made things better because the board has
issues communicating within itself. This is demonstrated in the situation
with Davy Jones. The direction from the board, such as it is, is not
effectively communicated to head manager Bob Dylan and two associate
managers, Joan Baez and Jimi Hendrix, who are at the physical plant.
There is no formal coordinated communication between Bob Dylan, Joan
Baez and Jimi Hendrix and the same is true for the teams they lead. This
lack of communication results in conflict and confusion among the design,
production and sales teams.
o Transactional Leadership
Ruggieri, & Abbate (2013)
of
Leadership
Case
Study
and
Teaching
Notes
Path-goal leadership theory is a form of transactional

leadership. Transactional leadership, by its very nature,
requires clear and consistent communication. In the
transactional leadership model, leaders are negotiating
agents who conciliate and sometimes compromise to
obtain greater decision-making power within the group.
To achieve this goal, they perform a series of actions
that enable them to influence and convince the
followers, who are capable of providing valuable
support. The activity of leaders consists of
implementing interpersonal transactions in which tasks,
expectations, and related awards are indicated and
clarified. The aim of rewards and punishments is not to
transform the followers but to ensure that the expected
results are achieved (p. 1172)
o Path-goal Leadership Theory
Schriescheim & Neider (1996)
Path-goal theory is securely tethered to the idea of
proper compensation and incentivisation for
employees. There must be proper compensation for an
employee to be motivated to perform their task. An
effective leader not only desires what is best for the
organization, but also considers individually valued
outcomes (House, 1996).
Back to the Case: Davy Jones is to be commended for his consistent
attempts to provide the communication and direction so desperately
needed by HHH Enterprises. He understands that leadership must interact
with members of the organization in an attempt to influence and
convince (Ruggeri & Abbate, 2013, p. 1172). Jones is doing the best he
can, but not only is he receiving no support from the rest of the team, he is
also getting negative reactions.
Because the board provides supervisors Dylan, Baez and Hendrix
with little support, they are unable to implement any structure of system
that would ensure that expected results are achieved (Ruggieri & Abbate,
2013). Further, because the compensation of the company is based on
regular salaries with no reward for exceptional performance, there is little
incentive for the employees to perform beyond the most basic
expectations.
7. Discussion Questions
1) How does the current structure of the company promote or hinder
the companys profitability?
of
Leadership
Case
Study
and
Teaching
Notes
2) What are some of the specific structures, rules and procedures that
are hindering the growth of HHH Enterprises? How could the
leadership, specifically (1.) Harvey Hatfield and the board and (2.)
the plant supervisors, remove the barriers to growth?
3) Could a general reorganization of the company benefit HHH
Manufacturing? How would an autocratic leader respond to the
companys struggles? Is it possible that HHH currently functions as
a benevolent dictatorship? How would a more beneficial pathgoal leadership style appear?
4) Should the employee compensation be restructured in such a way
as to incentivize the employees? If so, how would this look?
8. Responses to Questions
Question 1: What are the barriers that are standing in the way of
HHH Manufacturings growth?
Relevant Theories: Path-Goal, Transactional Leadership, Expectancy
Theory
Note to Instructor: This opening question is intentionally broad. While
case study is written in a somewhat humorous manner to engage the
students, it contains some very clear dysfunction that the students should
quickly identify. The issues presented in this case study primarily deal with
opportunities to provide recognizable examples of path-goal theorys (and by
extension transactional leadership and applicability to real world situations.
Possible Answers: Students answers may vary, but (hopefully) they should
fall along the lines of one of these three theories.
Barriers having to do with Expectancy Theory

o The employees do not believe that they are capable of
performing the work. Because they are divided and
unsupervised, the company appears to place little faith
in their abilities.
o Because the design, production and sales teams are
divided into essentially competing groups, they are
uncertain that their efforts would result in a predictable
outcome. In other words, a great deal of work could be
placed into a new design that never sees production
and/or distribution.
o The reward for doing anything beyond the bare
minimum is negligible. Because employees are paid a
of
Leadership
Case
Study
and
Teaching
Notes
base salary and their raises are only cost of living

adjustments, there exists no financial incentive for them
to do more than what is required.
Barriers having to do with Transactional Leadership Theory
o Transactional leadership requires communication. HHH
Enterprises has a massive failure in communication.
There is no communication within the board, little
communication between the board and the onsite
employees (with the exception of Mr. Jones) and poor
communication between the supervisors, teams and
employees.
o Fundamentally, Transactional leaders use both rewards
and penalties in order to motivate employees. HHH
Enterprises appears to do neither. Because of the lack
of oversight, the company has done nothing to penalize
the lack of performance nor has it done anything to
promote employees to be motivated to do anything
beyond basic expectations.
Path-Goal Leadership Theory:
o Because path-goal theory links employee productivity
with leadership behavior, the problems at HHH
Enterprises are a direct reflection of the lack of
leadership. The leadership is the problem.
o There is no directive leadership from the board, hence
the supervisors are unable to provide leadership to the
employees.
o There is little supportive behavior from the leadership.
The lack of proper HR personnel exacerbates this issue.
o The only participative behavior from the board comes
from Davy Jones and that behavior is not sanctioned by
the majority of board members. There is participative
behavior on the part of the supervisors because they
work in tandem with the teams, but their abilities are
hampered by a lack of clear guidelines from those who
should be supervising them.
o HHH Enterprises does not provide adequate
achievement behavior. Again, with the lack of
leadership on the part of the board and the lack of
instruction/support provided to the onsite supervisors,
there is little encouragement for the employees to
succeed.
o As Northouse makes clear, In its simplest form, the
theory reminds leaders that the overarching purpose of
of
Leadership
Case
Study
and
Teaching
Notes
leadership is to guide and coach subordinates as they

move along the path to achieve a goal (Northouse,
2013, p. 145).
Question 2: What are some of the specific structures, rules and
procedures that are hindering the growth of HHH Enterprises? How
could the leadership, specifically (1.) Harvey Hatfield and the board
and (2.) the plant supervisors, remove the barriers to growth?
Relevant Theories: Path-Goal
Note to Instructor: Path-goal is the primary focus of this lesson,
therefore this question is specifically designed to focus the students on
removing the barriers to the path of achievement. Transactional leadership
theory and expectancy theory will figure in this discussion, but the primary
focus should be on path goal.
Possible Answers: The students should identify these basic flaws in the
structure of HHH Enterprises and will, hopefully, identify the contrast
between these specific structures and path-goal theory
Structure of the HHH Enterprises Board and the resulting

lack of communication
o Path-Goal Leadership Theory
The lack of communication is hindering the ability
of the company to acquire the necessary
resources to adequately perform with the most
obvious being the neglect within the HR
department. The ability of work units to acquire
necessary resources depends on their relative
power within their organizations and on their
legitimacy in the eyes of those upon whom they
are dependent (House, 1996, p. 342).
There is no established system for
communication, thus the leadership is unable to
facilitate collaboration and positive interaction.
The disputes are left unresolved. Leader
behavior that facilitates collaborative and positive
interaction consists of resolving disputes,
facilitating communication, giving the minority a
chance to be heard, emphasizing the importance
of collaboration and teamwork, and encouraging
close satisfying relationships among members
(House, 1996, p. 341).
of
Leadership
Case
Study
and
Teaching
Notes
Lack of specific job descriptions and expectations for the

board and the plant personnel
The employees of the company have been left in a
situation where there is no clear role beyond
doing what they are told to do. Leader initiating
structure can be hypothesized to clarify path-goal
relationships for higher occupational level jobs
which are frequently ambiguously defined. Such
clarification reduces role ambiguity and increases
the employees perceived instrumentality of effort
toward goal attainment (House, 1971, p. 326)
Lack of communication between the board and the plant
supervisors
If the board has any plans or long-range
forecasts, they are not communicating those
ideas to those who can best accomplish them.
This is assuming, of course, that they even have
such strategies. Leadership behavior includes
Communication of high performance
expectations of followers and confidence in their
ability to contribute to the collective effort
(House, 1996, p. 343).
Lack of job descriptions for the plant supervisors
Dylan, Baez and Hendrix have no real
performance expectations because they have no
criteria by which to measure their performance.
Leaders should engage in the Communication of
high performance expectations of followers and
confidence in their ability to contribute to the
collective effort (House, 1996, p. 343).
Lack of adequate communication between the sales,
design and production teams
Leaders should engage in the Communication
of high performance expectations of followers
and confidence in their ability to contribute to
the collective effort (House, 1996, p. 343).
When the values inherent in the vision of a
value based leader are in conflict with the
dominant coalition of the larger organization or
the prevailing culture of the organization, value
of
Leadership
Case
Study
and
Teaching
Notes
based leadership will induce substantial intergroup conflict, or conflict between the leaders
work unit and the dominant coalition of the
organization (House, 1996, p. 346).
Absence of proper HR personnel
Question 3: Could a general reorganization of the company benefit

HHH Manufacturing? How would an autocratic leader respond to
the companies struggles? Is it possible that HHH currently
functions as a benevolent dictatorship? How would a more
beneficial path-goal leadership style appear?
Relevant Theories: Authority-Compliance Leadership, Path-Goal,
Transactional Leadership, Expectancy Theory
Note to Instructor: Many of the questions have led the students to this
point. It is obvious from the Case Study that the company needs significant
restructuring, so this is an opportunity for the class to provide helpful
suggestions. Additionally, the questions about an autocratic leader and a
benevolent dictatorship are designed to draw contrasts to the commonality
of goals that path-goal theory promotes.
Possible Answers
An autocratic leader would make sweeping changes

without regard to the effects on the employees.
o Authority-Compliance Leadership (Northouse, 2013)
The authority-compliance theory places heavy
emphasis on task and job requirements, and less
emphasis on people, except that people are tools for
getting the job done (Northouse, 2013, p. 79).
It could be argued that the neglect of the company
and Hatfield amount to a form of lasisez-faire or
indirect authoritarianism. In other words, the board
provides neither adequate goals nor adequate
resources for the accomplishment of the task,
therefore the employees of the company are
controlled by their incompetence. This would also
explain the growing rate of attrition.
Restructuring would be beneficial, but it would depend on
how significant the restructuring is in regards to moving
towards an established goal.
The reorganization must be done with the intention
of pursuing a clear goal. Each role must be seen as a
of
Leadership
Case
Study
and
Teaching
Notes
part of a much larger picture. The degree of

structure in a task and the extent to which it is
interesting and fulfilling are not conceptually
identical, but are related in practice (Chemers,
1997, p. 46).
Most subordinates needs will be influenced by
personal and environmental considerations
(Chemers, 1997, p. 48). The abilities and needs of
the individual must be taken into account during the
restructuring. In other words, the right people in the
right place doing the right thing.
In its simplest form, the theory reminds leaders
that the overarching purpose of leadership is to
guide and coach subordinates as they move along
the path to achieve a goal (Northouse, 2013, p.
145).
Restructuring must be done with the goal of getting
the right people in the right positions.
o Expectancy Theory (Lawler and Suttle, 1973)
Any restructuring must be done with a thorough
knowledge of the individuals involved. A person who
has a desire to perform at a higher level may be
better suited to sales, design or another high
motivation position in contrast to a person in a more
maintenance-related position. As Lawler and Suttle
(1973) state, knowing how attractive good
performance is to individuals gives some idea how
likely they are to perform well because on the
average people for whom it is very attractive should
be better performers than people for whom it is less
attractive. However, the best prediction should be
obtained by looking at each individual and comparing
how attractive good performance is to him in
comparison to other levels of performance (p. 501).
o Expectancy Theory
Expectancy theory is, in many ways, self-explanatory.
Just as an employer has certain expectations for
employees, an employee has certain expectations for
the employer. As Northouse notes, The underlying
assumption of path-goal theory is derived from
expectancy theory, which suggests that subordinates
will be motivated if they think they are capable of
performing their work, if they believe their efforts will
result in a certain outcome, and if they believe that
of
Leadership
Case
Study
and
Teaching
Notes
the payoffs for doing the work are worthwhile

[emphasis added] (p. 137).
Question 4: Should the employee compensation be restructured

in such a way as to incentivize the employees? If so, how would
this look?
Relevant Theories: Path-Goal, Transactional Leadership,
Expectancy Theory
Note to Instructor: By this time, the class should be refining the
restricting of HHH Enterprises. Having already tackled the bigger issues
of roles, job descriptions and other essential concerns, this question is
designed to challenge the students to consider more direct forms of
employee compensation and encouragement. Though the easiest and
most direct form of employee compensation is the salary and
compensation package, be sure to encourage your students to think
beyond simple material gain. For example, doesnt the restructuring itself
and the improved communication transform HHH Enterprises into a better
place to work?
Possible Answers
Workers would experience greater motivation if their

performance was reflected in greater financial reward. The
current system of simply providing a salary that is not tied
to performance does not encourage employees to perform
beyond the basic expectations.
Leaders try to enhance subordinates goal
attainment by providing information or rewards in
the work environment (Northouse, 2013, p. 137).
Contingent Reward Behavior, the degree to which
the leader administers positive rewards, such as
recognition, positive feedback, and approval,
contingent upon high performance levelshad a
positive effect on satisfaction (Podsakoff,
MacKenzie & Fetter, 2013, pp. 7 & 23)
o Transactional Leadership Theory (Northouse, 2013)
Fundamentally, the transaction being proposed is
greater reward for greater success. The more a
worker produces, the better they will be financially
rewarded.
of
Leadership
Case
Study
and
Teaching
Notes
o Expectancy Theory (Northouse, 2013)

Just as the name implies, a worker should rightly
expect adequate compensation for work
accomplished. A good leader should have a clear
understanding of the workers expectations and
should seek to clarify them and, if they are
reasonable, to meet them.
9. Teaching Materials and Tips

1. Encourage your students to engage in discussion. This can be a
profitable case study if the students are guided to see beyond the
humor and discover the very real issues facing HHH Enterprises.
2. The following charts and diagrams can be used at the instructors
discretion either as handouts or as PowerPoint slides.
Theoretical Foundations of Leadership Case Study and Teaching Notes
Path-Goal Leadership Theory
GOAL
S
Obstacles
Alternatives
of
Leadership
Case
Study
and
Teaching
From http://nwlink.com/~donclark/leader/lead_path_goal.html
Notes
Theoretical Foundations of Leadership Case Study and Teaching Notes
From http://nehaspeakshr.blogspot.com/2011/05/leadership-theoriesschools.html
10.
of
Leadership
Case
Study
and
Teaching
Notes
Epilogue
After being left alone in his office, Harvey Hatfield began to reflect on
his tense exchange with Davy Jones. Though still angry, he realized that
much of the initial success of his company was due to his consistent
presence at the production plant. In those early days, he worked closely with
his original employees. Working alongside Buddy Holly, Ritchie Valens, and
J.P. Big Bopper Richardson were sweet memories. He remembered working
side by side with them as they began this great adventures. It was that
memory working side by side that caused Hatfield to realize that Jones
was right. Time and success had distracted Hatfield from the very thing that
had made him successful. He realized that it was time to return to what
worked. HHH Enterprises needed to return to a clear path and it was
Hatfields responsibility to return the company to that purpose and to
remove the many obstacles to achieving those goals.
Hatfield called Davy Jones to ask him to help restructure the company.
First of all, the board would be redefined to occupy an advisory role. Hatfield
asked Jones if he was willing to serve as plant director through the
restructuring process and Jones happily agreed. Jones was given sweeping
powers to implement the changes that needed to be made with the
understanding that he would consult and report on his decisions with
Hatfield.
Jones immediately set up an office at the plant. He committed himself
to being physically present at the factory. He also encouraged Hatfield to
drop by regularly which Hatfield happily agreed to do. Jones began his
restructuring by calling a meeting with Dylan, Baez and Hendrix. He
informed them that Dylan would eventually become the plant director and
Baez and Hendrix would become associate directors. Baez was given
supervision of both design and sales with the goal of merging both
departments into complimentary roles. Her focus was to be on getting the
two to communicate and work together towards mutually agreed upon goals.
Hendrix retained his role as head of production, but his involvement was to
include the beginning of the design process and he needed to be more
involved at the ground floor of new designs. Dylan, Baez and Hendrix were
instructed to meet at least daily to coordinate their efforts. All three were
thrilled at the idea of working together and coordinating their efforts.
Further, the employee compensation structure was going to be
completely revised. While there would be a base salary, employee
compensation was now linked to sales. The more successful the company,
the greater the level of financial compensation. To further enhance
employee satisfaction and engagement, Jones immediately began active
recruitment of adequate HR personnel. The new HR personnel would be
of
Leadership
Case
Study
and
Teaching
Notes
tasked with revising and updating the job descriptions and the Policies and
Procedures manual.
11.
Annotated Bibliography
Chemers, M. M. (1997). An integrative theory of leadership. Mahwah, NJ:

Lawrence Erlbaum.
Leadership is an intrinsic part of human civilization. It can be argued that
the study of history is the study of leadership. As the study of leadership
has become a specific discipline, so too has the search for a
comprehensive leadership theory. There have been attempts in the past
with trait theory, behavioral theory and others. Chemers seeks to
integrate many previous concepts into something resembling a
comprehensive theory. The question of his success is largely left to the
degree of the readers acceptance of Chemers conclusions. However,
one thing that is largely indisputable about this book is the resource it
provides in both explaining previous theories and placing them in some
context. Chemers is forthright in sharing his opinions about the merits of
various leadership theories, but he is also fair in his presentation of their
positions. It is refreshing to read a text where the writer openly shares his
opinions, but also trusts the readers ability to arrive at their own
conclusions.
House, R.J. (1996) Path-goal theory of leadership: Lessons, legacy, and
reformulated theory. Leadership Quarterly, 7, 323-352.
Refreshingly written in first-person, House offers a somewhat personal
glimpse into the development of a theory and his observations about the
years of scrutiny, discussion and research into its validity. This article,
written over 25 years after the theory was first presented, is an overview
of his observations about the research and a reformulation/refinement of
the initial theory. House begins by reviewing the initial articulation of the
theory in 1971 and a further refinement offered in 1974. In reviewing the
research into testing the validity of path-goal, he laments that it has not
been adequately studied, in part because the methods used for testing
too closely approximated the constructs of the theory. He acknowledges
this lack and proposes several remedies for the situation. In contrast to
his original theory, Houses reformulated theory provides specific
of
Leadership
Case
Study
and
Teaching
Notes
leadership behaviors that can empower followers and provide members of

the organization with greater satisfaction and effectiveness. This
reformulation, along with the rationale behind the modifications, are both
helpful and enlightening.
Lawler, E. E., III, & Suttle, J. L. (1973). Expectancy theory and job behavior.
Organizational Behavior and Human Performance, 9(3), 482-503.
This is one of the seminal works in expectancy theory. Building on the
early work of Vroom, Porter, Graen and his (Lawlers) own contributions,
this study was an attempt to both refine the previous versions of the
theory and to test its validity over a year-long study involving 60
managers in retail sales. The results show some support for expectancy
theory, specifically that the use of the theory can, to a limited degree,
predict behavior, but, like path-goal theory, expectancy theory suffers
from the same problem of complex and numerous variables. Though
dated as of this writing by over 40 years, this article provides a succinct
overview of the thinking that contributed to expectancy theory and
demonstrates the challenges with providing solid support to a theory that
attempts to encompass so many variables.
Northouse, P. G. (2013). Leadership: Theory and practice (6th ed.). Los
Angeles,
CA: Sage.
In this overview of various leadership theories, Northouse (2013) provides
a chapter focusing on Path-Goal Theory (pp. 137-159). Written in a
crisp, summary style typical of this type of volume, Northouse provides
description, strengths, criticisms, application, case studies and a PathGoal Leadership Questionnaire. Though this volume is not meant to be a
comprehensive overview of each theory, this chapter does provide a
helpful summary of what can become an overly complicated theory. This
complexity is noted by the author as one of the primary criticisms of pathgoal theory. As an introduction to path-goal theory, Northouse has
succeeded in doing what many of the proponents of path-goal have failed
to do: to make the theory understandable and practical.
Podsakoff, P.M., MacKenzie, S.B., & Bommer, W.H. (1996). Meta-analysis of
the relationship between Kerr and Jermiers substitutes for
leadership and employee job attitudes, role perceptions, and
performance. Journal of Applied Psychology, 81(4), 380-399.
Leadership is an influence relationship. Therefore, it is critical that a
leader understand which type of leadership behaviors can effectively
influence followers. Though this article acknowledges that the amount of
of
Leadership
Case
Study
and
Teaching
Notes
understanding remains somewhat incomplete, they do recognize that

some important contributions have been made. Part of this problem is in
the creation of proper assessments for measurement. Of particular
significance to the present path-goal case study, the authors mention
Houses work in path-goal several times, despite the fact that this article
was not written to focus exclusively on path-goal theory. Specifically
mentioned is his work in 1977, 1991 and 1998 to identify specific
leadership attributes including instrumentality and supportiveness. These
references are, by and large, positive and provide additional support for
the soundness of path-goal theory.
Ruggieri, S., & Abbate, C. S. (2013) Leadership style, self-sacrifice, and
team identification. Social Behavior & Personality: An International
Journal, 41(7), 1171-1178.
Path-goal theory can be classified as a transactional form of leadership.
Therefore, background information on transactional leadership is both
necessary and appropriate. This article provides clear definitions of both
transactional and transformational leadership and compares and
contrasts the two. In transactional leadership, leaders negotiate with
members of the organization through conciliation and compromise to
motivate the team toward mutually acceptable goals. Transformational
leadership, on the other hand, seeks to transform the individuals values.
This study demonstrated that both transactional and transformational
leadership was beneficial to team identification, but that transformational
leadership was more advantageous to a stronger relationship.
Wofford, J.C., & Leska, L.Z. (1993). Path-goal theories of leadership: A
meta-analysis. Journal of Management, 19, 857-876.
As this article makes clear, path-goal theory focuses primarily on a
leaders ability to articulate goals to employees that they perceive to be
beneficial, minimizing impediments to achieving those goals and
maximizing their satisfaction. These goals are limited by the
organizational environment and the attitudinal characteristics of the
followers. With this understanding, the authors attempted to ascertain
the validity of the path-goal theory through testing and meta-analysis.
The results of this meta-analysis tended to support the legitimacy of the
theory, but recognized the issues with environment, individual follower
behavior and the inability to identify with certainty the impact of an
individual leader on follower behavior. These are issues which House and
others have also identified.
of
Leadership
Case
Study
and
Teaching
Notes
Isaac, R.G., Zerbe, W.J., Pitt, D.C. (2001). Leadership and Motivation: The
effective application of expectancy theory. Journal of Managerial
Issues, 13. 212-226.
This article defines the relationship of linking expectations of workers to
desirable outcomes. It also explores the idea that all employees could be
and, perhaps, should be a leader regardless of their title. When a person
chooses a particular course of action, based upon perceptions, attitudes
and beliefs, as a consequence of their desires to enhance pleasure and
avoid pain, they have an expectation as to what the outcome will be.
Their motivation comes from the choices that are made and the outcomes
those choices may produce.

Case Study Ldrs 801

Uploaded by

Document Information

Original Description:

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Case Study Ldrs 801

Uploaded by

Copyright:

Available Formats

Trapped in the

LDRS 801: THEORETICAL FOUNDATIONS OF

Trapped in the Sixties

tied to particularly profitable years. However, as their sales continued to

could jeopardize the companys operating line of credit. Rumors are

Part II: Initial Issues Observed

However, within the company, there are a number of specific issues

4. The lack of trust between leadership is evident in the situation with

Beyond the board, there are significant issues with communication

6. Further, the structure of employee compensation and position

Could a general reorganization of the company benefit HHH

Should employee compensation be restructured in such a way as to

other theories, and would be able to participate in a discussion about

4. Key Issues (list of topics that should be discussed)

and psychologically supportive work

Back to the Case: When HHH Enterprises was a new organization,

reinforce the feelings of subordinates so that

Path-goal leadership theory is a form of transactional

Barriers having to do with Expectancy Theory

base salary and their raises are only cost of living

leadership is to guide and coach subordinates as they

Structure of the HHH Enterprises Board and the resulting

Lack of specific job descriptions and expectations for the

Question 3: Could a general reorganization of the company benefit

An autocratic leader would make sweeping changes

part of a much larger picture. The degree of

the payoffs for doing the work are worthwhile

Question 4: Should the employee compensation be restructured

Workers would experience greater motivation if their

o Expectancy Theory (Northouse, 2013)

9. Teaching Materials and Tips

Theoretical Foundations of Leadership Case Study and Teaching Notes

Bradley and Weiss, 26

Path-Goal Leadership Theory

Theoretical Foundations of Leadership Case Study and Teaching Notes

Bradley and Weiss, 28

Chemers, M. M. (1997). An integrative theory of leadership. Mahwah, NJ:

leadership behaviors that can empower followers and provide members of

understanding remains somewhat incomplete, they do recognize that

You might also like