Reading: What is transformational leadership?

You don’t have to spend long in the working world to recognize there are multiple types of leaders. Every kind of leader motivates, challenges and develops employees in different ways. Their corresponding styles can all inspire different outcomes.

In recent years, transformational leadership has risen to the surface. Organizations in all industries are seeing rapid change in today’s digital era. Transformational leaders know how to encourage, inspire and motivate employees to perform in ways that create meaningful change.

The result is an engaged workforce that’s empowered to innovate and help shape an organization’s future success. Your curiosity may leave you wondering, “What is transformational leadership, exactly?” Join us as we help answer this question.

The origins of transformational leadership

While transformational leadership principles are well-suited for today’s fast-paced, diverse and highly technological workforce, the style is far from a new development. Presidential biographer and leadership expert James MacGregor Burns is credited with coining the concept in the 1970s. Organizational change and leadership development expert Kevin Ford builds off this model that Burns initially identified. According to Ford, there are three effective leadership styles:

• Tactical leaders focus on solving straightforward problems with operations-oriented expertise.
• Strategic leaders are very future-focused with an ability to maintain a specific vision while forecasting industry and market trends.
• Transformational leaders focus less on making decisions or establishing strategic plans, and more on facilitating organizational collaboration that can help drive a vision forward.

As you gain a clearer understanding of transformational leadership, it’s helpful to walk through the various components that are inherent to this management style. But first, it’s worth evaluating the differences between transformational and transactional leadership.

Transformational leadership vs. transactional leadership

Leaders, it’s important to note, aren’t confined to a single leadership style. In many cases, combining different approaches can enhance organizational outcomes. Transformational and transactional leadership are two styles that have been thoroughly researched, and a given leader may exhibit varying degrees of both styles.

Transactional leadership is based on a system of exchanges between the leader and each employee. Employees receive positive reinforcement for meeting specific goals. An effective transactional leader is adept at recognizing and rewarding accomplishments in a timely manner. Within this leadership style, team members are typically evaluated and given feedback based on predetermined performance criteria. Workers aren’t necessarily expected to think innovatively about the tasks at hand.

In contrast, transformational leaders inspire employees in ways that go beyond exchanges and rewards. This approach can increase a team’s intrinsic motivation by expressing the value and purpose behind the organization’s goals.

A transformational leadership style inspires employees to strive beyond required expectations to work toward a shared vision, whereas transactional leadership focuses more on extrinsic motivation for the performance of specific job tasks. Learning to balance these styles can help leaders reach their full potential.

4 Components of transformational leadership

As transformational leaders work with their employees to implement effective change, they rely on things like communication, charisma, adaptability and empathetic support. In practice, this leadership style comprises four primary elements:

• Individualized consideration — Transformational leaders listen to employees’ concerns and needs so they can provide adequate support. They operate from the understanding that what motivates one person may not motivate someone else. As a result, they’re able to adapt their management styles to accommodate various individuals on their team.

   

• Inspirational motivation — Transformational leaders are able to articulate a unified vision that encourages team members to exceed expectations. They understand that the most motivated employees are the ones who have a strong sense of purpose. These leaders are not afraid to challenge employees. They remain optimistic about future goals and are skilled at giving meaning to the tasks at hand.

   

• Idealized influence — Transformational leaders model ethical behavior. Their moral conduct earns a necessary level of respect and trust. This can help leaders steer decision-making that works to improve the entire organization.

   

• Intellectual stimulation — Transformational leaders regularly challenge assumptions, take risks and solicit team members’ input and ideas. They don’t fear failure, and instead foster an environment where it’s safe to have conversations, be creative and voice diverse perspectives. This empowers employees to ask questions, practice a greater level of autonomy and ultimately determine more effective ways to execute their tasks.

5 Traits successful transformational leaders have in common

As you consider the transformational leadership style, you may be wondering what it looks like in practice. Forbes senior contributor Blake Morgan outlines a number of habits common to effective transformational leaders. Here are five of the most essential traits:

1. Good transformational leaders practice self-awareness

Transformational leaders thrive on personal growth and know their strengths and weaknesses. They often take time to reflect and set daily or weekly goals. These leaders believe everyone, including themselves, should be continually learning and improving.

2. They remain open-minded

Remaining open to new ideas and fresh perspectives is an important aspect of transformational leadership. Rather than jumping to conclusions, these leaders regularly gather feedback and ideas from a range of sources before making strategic decisions.

3. The best transformational leaders are adaptable and innovative

Good transformational leaders understand changing business dynamics and are always finding innovative ways to stay ahead of the curve. They’re unafraid to alter traditional approaches that have worked in the past as they look toward the future.

4. Good transformational leaders are proactive

Leaders cannot simply sit around and wait for change to happen. Rather, they make proactive decisions and bold choices that can set the tone for others to follow.

5. They lead with humility

Finally, transformational leaders take little issue with admitting they don’t have all the answers. While they can remain confident in their goals and abilities, they’re also able to keep their egos in check and do what’s right for their team or organization.

Make an impact as a transformational leader

Now that you know the foundations of transformational leadership, you can see how beneficial it can be. You can answer not only, “What is transformational leadership?” but also, “Why is it effective?” You may even be thinking about some actionable ways to put this style into practice.