The path-goal leadership approach predicts that leadership effectiveness is contingent on matching leadership style to a particular business situation, so a research and development division might require a different leader style than one focused on customer service.

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The path-goal theory of leadership suggests that a leader's effectiveness is determined by their ability to clear paths to their followers' goals, which involves adapting leadership style to the specific context or situation of the team, including the nature of the task and the team's needs. Therefore, a research and development division, which typically focuses on innovation and creativity, might benefit from a different leadership style (e.g., supportive or participative) than a division focused on customer service, which might require a more directive or achievement-oriented style to ensure high levels of customer satisfaction.

The Path-Goal Leadership Approach Predicts That Leadership Effectiveness Is Contingent