Transformational leadership: leading innovation teams through engagement
Transformational leadership is viewed as the answer to the cultural transformation taking place in organisations. What is it? What impact does it have on businesses? We explore the concept of transformational leadership and its many benefits.
Transformational leadership is not a new concept. Its popularity reflects the cultural change taking place within companies all around the world. It has been embraced by millennials searching for more meaningful jobs and a more personalised style of management, and also has been driven in part by the health crisis that changed work practices forever. Transformational leadership is a way for companies to adapt to an ever-changing, volatile, uncertain, complex and ambiguous (VUCA) economic landscape.
Transformational leadership has been the subject of numerous studies over the past thirty years. Its definition, however, is sometimes unclear, with some authors considering it a 2.0 version of the 'charismatic leadership'. So, what is transformational leadership? How does it impact organisations? And how does it differ from charismatic leadership?
In this article we explore the concept of transformational leadership and its many benefits.
Transformational leadership: A definition
In the mid-1980s, Bernard Bass was one of the first scholars to conceptualise the notion of transformational leadership, identifying four dimensions.1
- Idealised influence: Leaders exemplify and inspire confidence in their teams. This trust then translates into a higher level of engagement and resilience to deal with new situations.
- Motivation: Leaders are able to communicate an inspiring vision that appeals to the intrinsic values of their teams and encourages them to take more initiatives and aim for success.
- Intellectual stimulation: For both leaders and their teams, this trait enables risk-taking, collaboration and the emergence of new ideas.
- Individualised consideration: Transformational leaders build individual relationships with each of their team members and take an interest in their development and well-being.
As a management style, transformational leadership is the antithesis of transactional leadership - a form of management in which the leader has a passive, hierarchical, give-and-take relationship with their team.
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Where a transactional leader will take a micro view of the management of their team and will focus on processes or mistakes, the transformational leader will put aside their personal interests in favour of those of the group.2 They will develop a macro view of the objectives to be reached. By doing so, the transformational leader will literally 'transform' their team members into self-starters who are able to work autonomously for their own personal development and the good dynamics of the group.3
The benefits of transformational leadership
The positive impact of transformational leadership has been widely documented, including its influence over all aspects of individual and team performance - and, by extension, its positive effects on the organisation's vitality. Various studies indicate that by appealing to people's inner values and developing their sense of self-efficacy, transformational leadership positively impacts team performance.4
Similarly, shared values and common goals are a source of satisfaction for employees and encourage them to become even more committed to their work - therefore fuelling the virtuous circle of performance. At a time when the psychological health of employees is high on the agenda of many companies, transformational leadership has a significant influence on well-being, particularly in dealing with stressful situations or depressive symptoms.5 This is made possible by the leader's individualised attention to their team members through regular and open conversations and a fair and caring work environment.
The differences between transformational and charismatic leadership
Despite its many benefits, transformational leadership is often confused with charismatic leadership, as both share some specific characteristics - for example, the charisma that both types of leaders display. However, the two approaches are different: A transformational leader will seek to build a group unit by rallying behind it, whereas the charismatic leader will embody the project or vision they are carrying.
The success of transformational leadership does not rest solely on the magnetism that the leader exerts on - and sometimes cultivates with - their collaborators, but rather on a mastery of relational intelligence and interpersonal skills. Whereas a charismatic leader will tend to think in terms of 'personal success' in a somewhat transactional sense, a transformational leader will focus more on achieving group objectives, while keeping everyone involved. Their ability to rally people around them is linked to the fact that his vision is intrinsically linked to the values of their collaborators, based on a common language, and reference system.
In companies, charismatic leadership is effective in times of crisis that require swift, sometimes radical, decisions and the group's adherence to a strong leader. The charismatic leader will often play a "unifier" role by capitalising on their ability to captivate and use their magnetism. A transformational leader can be just as unifying but will use humanistic values to achieve their goals - a long-term method.6
Transformational leadership as a lever for commitment
Transformational leadership is on the rise because it naturally meets strong expectations from collaborators: A meaningful job, equity, empathy, individualised management, and personal and professional development. Although the leader’s charisma plays a role in the success of this type of management, not all good transformational leaders need to have the eloquence or magnetism of Steve Jobs or Barack Obama to rally others around them and encourage their teams to excel. Instead, this management style exemplifies the power of the group.
1 'Leadership and performance beyond expectations', Bass B. M., Free Press, 1985.
2 'Ethical Values of Transactional and Transformational Leaders', Kanungo R.N., Canadian Journal of Administrative Sciences / Revue Canadienne des Sciences de l'Administration, 18: 257-265, 2001.
3 'Relationships Between Leadership and Followers’ Quitting Intentions and Job Search Behaviors', Hughes LW, Avey JB, Nixon DR, Journal of Leadership & Organizational Studies, 17(4): 351-362, 2010.
4 'Self-efficacy, the exercise of control', Bandura A., Freeman, 2012.
5 'Transformational leadership and depressive symptoms: A prospective study', Fehmidah Munir, Karina Nielsen, Isabella Gomes Carneiro, Journal of Affective Disorders, Volume 120, Issues 1–3: 235-239, 2010.
6 'Qui sont les leaders transformationnels?', Boudrias Jean-Sébastien, Brunelle Eric, D'Amours Liette, Gestion, 40: 27-29, 2015.