Why It Works and How it works

Ronald Riggio, Leadership Professor, Claremont Institute, USA | April, 2012


Transformational Leadership: What it Is, Why it works, and How to develop It. If there were a form of leadership that could motivate workers to high levels of performance and commitment, and also develop workers’ potential, wouldn’t you want to know about it? Or, better yet, implement it? Enter transformational leadership.
Transformational leadership is a relationship-based approach to leadership, whereby leaders focus on employees’ individual needs and motivate them. Transformational leadership puts the employees’ intrinsic motivation at the heart of its theory.
The Elements of 
Transformational Leadership
Transformational leader has four unique qualities: 
1) Idealized Influence: The transformational leader is a role model for its team. This may relate to the leader’s perseverance, abilities, or other aspirational qualities. While much of this is perception based, it is tied into the leaders’ example, such as a willingness to take risks, a desire to do the right thing, or consistency. 
2) Inspirational Motivation: The transformational leader inspires his or her followers. The leader provides a compelling purpose and vision for the organization, while simultaneously fostering a sense of enthusiasm and optimism. Team members feel involved in making the vision a reality. 
3) Intellectual Stimulation: Empowerment is a key aspect of transformational leadership. Followers feel like they make a difference and their contributions are valued. The transformational leader encourages followers to question assumptions or reexamine paradigms. As a result, all levels of the organization foster organisational breakthroughs. 
4) Individualised Consideration: Followers are developed into leaders of their own through active coaching or mentoring by the transformational leader. Through these individualized development plans, each individual’s capacity is enhanced over time. With the accumulated growth of individual capacities, the organisational capacity is taken to new levels.
These individual leadership components also integrate with management, and as such transformational leadership is differentiated from transactional leadership. Transactional leadership is based on the exchange of rewards for expected performance. It involves identifying what needs to be done by offering explicit value for one’s accomplishments. Transactional leadership emphasizes more extrinsic motivation, while transformational leadership enhances the intrinsic, or inner, motivation of followers.
Transformational leadership goes well beyond transactional leadership. It inspires followers to buy into the shared vision and goals, encourages them to be insightful problem solvers, and at the same time, develops follower leadership through coaching, mentoring and a balance of providing challenges and support. Nevertheless, what can one anticipate in terms of the transformational leader’s performance? 
Why it works? 
Many studies have found that transformational leadership leads to a number of extraordinary outcomes. How does it achieve these extraordinary outcomes? 
Five of these changes are highlighted. First, the follower’s confidence or self-efficacy is enhanced. This greater belief in one’s own abilities leads to stronger performance. It occurs on both the individual and group level, or in other words, the sense of being able to perform well (what is called “self-efficacy” is enhanced at the individual and collective levels. Secondly, followers identify with the leader. This identification is bolstered both by trust and confidence in the leader. Thirdly, engagement reaches new heights. The alignment of goals fosters commitment. Fourth, followers become more creative. This creativity is spurred by being intrinsically motivated. This is in contrast to extrinsic motivation associated with transactional leadership. Outside the box thinking is encouraged and exemplified. Fifth, followers are developed into leaders of their own. Transformational leaders provide coaching and mentoring more so than transactional leaders. Furthermore, followers of transformational leaders are more likely to seek feedback than transactional leaders. Overall, all of these changes positively affect performance of an individual and of the team. So, how does one become a transformational leader? 
How it works? 
Becoming a transformational leader is a long-term commitment. On one hand, the development begins with early life experiences. However, some individuals have become pioneers of their past, and past experiences do not necessarily dictate the future. A few examples include Pierre Cardin and Henry Ford. Pierre Cardin wanted to get even for all the things he suffered as a youngster with many upheavals in his family life. His drive and determination contributed to his success. Similarly, Henry Ford’s commitment launched one of the largest corporations in the world.
Leaders can nevertheless remain committed to the transformational leadership model. Six specific competencies are developed: 1) Problem solving approaches, 2) Creating compelling visions, 3) Communicating, 4) Impression management, 5) Empowering employees, and 6) interpersonal skills development, including cultural differences, and building a community.
In order to develop this form of leadership, it’s suggested that the leader undertake an assessment via the MLQ (Multi-Factor Leadership Questionnaire), which is the most validated instrument for measuring transformational leadership. This is followed by a personal development plan. The MLQ results provide a baseline to get started and provide a roadmap for development. An executive coach can also help. It’s important that this feedback be utilized to create a new future, rather than focus on past leadership. 
Again, transformational leadership is not developed overnight. It is a long-term development initiative and dedication. Establishing a plan is most important. Often is includes areas of development and may include attending workshops, one-on-one coaching, and developmental assessment centers, among others. Similar to early life development, such an approach involves scaffolding on the leader’s current ability to function as both a transactional leader with an eye toward transformational leadership. Education and skill training are key components. Follow-up may include a reassessment on one’s skills.
Transformational leadership is a key component in taking an organization to the next level. The leader enables followers to be leaders in their own right. This cannot be done through management tactics, but can only occur when followers are inspired to reach higher levels with the necessary motivation and empowerment. In the end, transformational leadership makes a difference. Developing leaders in this manner is a longer-term initiative, but one well worth the effort. Great leadership, in the end, makes all the difference.