Business Finance
path theory vs normative decision therapy

Question Description

I’m working on a Business question and need guidance to help me study.

Compare and contrast Path-Goal Theory and Normative Decision Theory with a focus on which you believe leads to the most effective organizational leadership. Provide specific examples to support your response.

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Final Answer

the path goal theory states the the most successful leaders motivate their subordinate staff by establishing leads to high performance. such a mechanism is supportive and motivating with an intended goal to raise the spirit of workers and gear them to self belief, identifying individual capabilities to utilize them optimally. this theory capitalizes on the virtue of autocracy to give directives in a rather supportive manner and mutual involvement towards a succeeding goal and the ultimate sharing of success. its an achievement oriented leadership with senior and junior involvement in decision making.

the normative decision theory, the manager takes in to account an hierarchical decision making with sole decision making or decision based on suggestions or advice from subordinates.this compromises the outcome from such decisions which might not work well in the event that the underlying situation is not well versed in any of the parties. in this theory autocracy is vital thus quick decisions can be achieved, however this compromises the subordinate morale to feel a part and parcel of a success strategy or may be helpless in the event the decision doesn't go in their way of reasoning and self drive.


the microsoft company has applied the path goal theory to remain ever competitive in the market. this strategy has enabled it to raise intrapreneurship and this has been its goal to establishment of ever competitive products. this can be seen to be a succeeding strategy as opposed to normative decision theory where workers would have only to take what the management offer thus discouraging intrapreneurship

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