Transformational Leadership

A transformational leader knows how to inspire a group. They're good at delegating, and tend to encourage other members to take risks. Those members then feel they're also able to help grow and shape the future of the group.

Written and verified by the psychologist Valeria Sabater.

Last update: 15 November, 2021

We need transformational leadership. In times of crisis and ever-changing complexity, it’s more important than ever to have inspirational leaders. Indeed, extraordinary times call for extraordinary leaders with innovative ideas.

The concept of transformational leadership first appeared in the mid-20th century. In fact, it was James V. Downton who first coined this term. However, the idea didn’t really provoke any interest until the late 1980s. It was Bernard M. Bass, a scholar of industrial and organizational psychology, who then further developed it. Furthermore, he supported the idea with important scientific data.

It actually makes more sense to apply this kind of approach in the area of leadership today. Because it’s basically about developing a business culture in which businesses are encouraged to be more autonomous, responsible, and motivated to overcome difficulties, take risks, and achieve success.

What’s transformational leadership?

There are different types of leadership: democratic, autocratic, transactional, and transformational, to name a few. Indeed, there are many ways to lead. However, not all of them are necessarily effective. In actual fact, it’s true to say that each organization tends to develop its own management structure. However, not all of them will manage to achieve a good working atmosphere or to improve their production levels enough to ensure a good market position.

It’s a sad fact that the classic authoritarian management model continues to dominate today, where there’s a clear differentiation between bosses and employees. However, in these kinds of scenarios, there isn’t really a true leader. In fact, there’s just a figure who uses their authority to impose their ideas onto their employees in an extremely conventional manner.

Large companies know that this model doesn’t work. In fact, they know that what’s needed, more than bosses, are good leaders. People who are capable of inspiring and transforming. Thus, in recent years, certain changes have been made, such as the introduction of transactional leadership.

Transactional leadership is a model whereby the employee is motivated via economic incentives. Every effort they make is rewarded financially, hence the company’s productivity is also improved. However, is this the best model?

For experts like Bernard M. Bass, the answer is no. He’d argue that transformational leadership is the best way for one company to lead over the others.

Transformational leadership qualities

According to Dr. Bass, a transformational leader does all of the following:

• Motivates and inspires a positive mood in the working environment.
• Is a clear example of the values of the organization itself, is dynamic, and has clear moral principles.
• Is ethical, creative, and emotionally intelligent with good communication skills.
• Develops a working environment where priorities are made clear.
• Trusts their employees’ potential and capabilities.
• Encourages their employees to think of the company as something that’s part of them.
• Places great emphasis on honesty, cooperation, respect, and open communication.
• Provides training and mentoring.
• Creates harmony.
• Encourages people to make decisions for themselves.
• Encourages people to take responsibility for their duties.
• Makes work easy and motivating. They do this by creating an exciting environment where the employees feel encouraged to make valued suggestions and contributions.

How’s transformational leadership developed?

According to Bernard Bass, there are four components of transformational leadership:

Idealized influence (II)

The leader’s the role model for the whole company to follow. Furthermore, they don’t just lead by example, they firmly believe in what they can do. This impacts others. Thus, this kind of leader is inspirational because they believe both in what they do and what they want to achieve.

At the same time, this type of leader hopes that their team will develop these same qualities. They’re transformative leaders because they drive others to make changes as well as guiding and tutoring them.

Individualized consideration (IC)

Transformational leadership is also compassionate leadership.  The transformational leader cares about each individual employee and genuinely connects with them with the aim of them reaching their full potential. Because an employee who’s skilled and happy in their work is someone of great value to the company.

Inspirational motivation (IM)

Above all, leading is about motivation. Motivation means giving a person reasons to strive and face challenges, to always give their best. This is something that differentiates transformational leadership from other forms, in that it impacts people in a simple but forceful way.

Indeed, the goal is for everyone to be so committed to the organization’s aims that they feel free both to propose new ideas and to make decisions for themselves.

Intellectual stimulation (IS)

This is a really interesting aspect of transformational leadership.  Transformational leaders challenge their employees with the goal of stimulating their creativity. This is so the employees go beyond the ordinary and achieve the extraordinary. Transformational leaders achieve this by trusting their employees and placing responsibility upon them, as well as stimulating them intellectually.

This transformational approach is as interesting as it is revealing. Indeed, without a doubt, every organization should adopt this form of leadership. Figures who study this particular theory are usually quick to point out that a good example of a transformational leader was Nelson Mandela. In fact, Mandela used the principles of transformational leadership to abolish apartheid and bring about change in South Africa. Furthermore, he achieved it. Indeed, there’s absolutely no doubt that Nelson Mandela remains a true form of inspiration for us all.