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78 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Exhibit 3.6 Path–Goal Situations and Preferred Leader Behaviors

Situation Leader Behavior Impact on Follower Outcome

Increases confidence
Follower lacks Supportive
self-confidence Leadership to achieve work
outcome

Directive Clarifies path
Ambiguous job
Leadership to reward Increased
effort;
improved
satisfaction
and
Achievement-
Lack of job Sets and strives performance
challenge Oriented for parallel structure
Leadership

Incorrect Participative Clarifies followers’
reward Leadership needs to change
rewards

change this. By discussing the subordinate’s needs, the leader is able to identify
the correct reward for task accomplishment. In all four cases, the outcome of fi t-
ting the leadership behavior to the situation produces greater employee effort by
either clarifying how subordinates can receive rewards or changing the rewards
to fi t their needs.
At The Home Depot, former CEO Bob Nardelli reinvigorated employee
morale—and retail sales—with his achievement-oriented leadership, which
cascades down from headquarters to the store level.

IN THE LEAD Bob Nardelli, The Home Depot
When Bob Nardelli took over as CEO of The Home Depot, one of his fi rst moves
was to impose high goals for everyone from headquarters down to the store level.
By doing so, he turned a retail chain where employees were becoming complacent
and bored into a company full of enterprising people who thrive on challenge,
responsibility, and recognition.
Many low-performing store managers, who were accustomed to a more relaxed
approach, left the company. Nardelli slowly began building a cadre of talented people,
from top to bottom, and instituting a “no-bull performance culture” that gave people
challenging goals and generous rewards for achieving them. Rigorous talent assess-
ments, new approaches to hiring, new performance measurement systems, and pro-
grams such as the Store Leadership Program and Accelerated Leadership Program
enhanced employee skills and reduced turnover. Nardelli monitored stores in real
time via computer, and he spent 1 week a quarter as a “mystery shopper,” popping in
unannounced to as many as 10 stores a day.