Transformational Leadership: Origins, Current Applications, Downsides, and Future

One of the critical problems of modern Leadership Studies is the determination of an optimal management approach. High technological costs and constant changes characterize the modern economy, requiring the utmost flexibility on the part of the leaders and their employees alike. In the past, the complexity of various technological and organizational tasks was low enough to create the culture of a ‘visionary’ entrepreneur. This entrepreneur, typically, was an unconventional inventor, who presented his creations to the public through the power of the free market. The phenomenon was so powerful that it still manifests in the cultural artifacts of today, with real people such as Steve Jobs and fictional characters such as Tony Stark (Iron Man) being revered in the American culture. However, the complexity of technology and organizational tasks has become too extensive for one person to manage. Thus, a transition to transformational management, which is aimed at empowering the employees to pursue organizational goals, is necessary because the authoritarian methods of the old times are no longer efficient when it comes to the control of large-scale corporations.

Evolution of the Views on Leadership

The introductory section has mentioned the interrelation between the approaches to leadership and technological change. To a great extent, the existing academic literature confirms these assumptions, showing a gradual transition of the approaches to leadership from authoritarian models to the employee-centered laissez-faire frameworks. In this regard, Mostafa Ghasabeh and his colleagues show an illuminating collection of the statements on vital leadership values starting from 1948. At the beginning of the observations, the leaders had to exhibit “alertness, initiative, intelligence, insight, persistence, and responsibility” (Ghasabeh et al. 461). Until the 2000s, this framework was mostly similar, with leaders having to exhibit ‘masculinity,’ confidence, and a powerful sense of achievement. Post-2000 data, however, indicates a radical shift in the desirable traits of a leader. Instead of an innovative and charismatic leader, the scholars started to highlight agreeable, intelligent, conscientious, emotionally stable, extroverted, motivated, and open managers (Ghasabeh et al. 461). Most likely, this radical transformation is a result of the aforementioned growing complexity of the modern business world. An authoritarian leader, however talented, is becoming unable to control countless organizational variables. Consequently, the skill of leadership through delegation of tasks is becoming the critical trend of the current era. In this regard, only two models can function as a reliable alternative to the authoritarian approaches of the preceding century: transformational style, which is emphasized in this essay, and the so-called servant leadership.

Transformational Leadership: Theoretical Foundations

Transformational leadership advocates tight cooperation between the followers and the leaders, emphasizing a high degree of autonomy for both groups. In this regard, Burns, who was among the founders of this approach to leadership, proclaimed that the model promotes “satisfying basic needs and meeting stronger desires through inspiring followers to provide newer solutions and create a better workplace” (Ghasabeh et al. 462). Thus, the main goal of a transformational leader is to create and direct an autonomous system within which ordinary employees would achieve desired and predictable results.

A transformational leader must be decisively non-authoritarian to achieve his or her goals. Experts note that four key elements are necessary to control a transformational system: individualized consideration, intellectual stimulation, idealized influence, and inspirational motivation (Ghasabeh et al. 462). To a great extent, they are congruent with the aforementioned desired values of a leader, hinting at the high viability of transformational leadership in the modern world. The transformational leader does not view his or her subordinates as a resource, seeing them as partners and co-managers instead. Thus, the theory is in line with the increasingly progressive values of modern society.

Obviously, the idyllic vision of a progressive company with highly-autonomous employees that is led by the transformational leader calls for a healthy degree of skepticism. Thousands of things can go wrong in such a case; for instance, emboldened by the autonomy, employees may start introducing fake innovations to gain the trust of their leader. After all, many famous ideas (for instance, socialism) were perfect on paper but failed to work in reality. In this regard, empirical data shows that the seemingly utopian transformational leadership model is likely to work, once again confirming the monumental shift in the role of a leader that occurred at the beginning of the 21st century. For instance, some scientists conclude that transformational leadership and similar models considerably raise the satisfaction and loyalty of the employees. The promotion of one of the modern leadership models within an organization tends to grant a definite 25% increase of specific vital organizational processes (for instance, job satisfaction), making the adoption of moral leadership viable, according to Hoch and her colleagues (523). Most likely, the quality of the modern workforce is sufficient enough to make autonomy-oriented changes possible in the modern world.

One of the key examples of successful transformational leadership is that of Howard Schultz and his Starbucks Corporation. Starbucks is one of the most famous coffee chains in the world today, being an example of the tremendous success that can stem from transformational leadership. Instead of following the traditional model of employee exploitation and the typical maximization of profits, Howard Schultz directed the company to treat its employees most respectably. This organizational approach manifests in many internal processes. Firstly, the company provides significant financial perks to its employees. In this regard, the list of employee benefits includes company payments to the 401K pension account, a stock purchase plan for its employees, potent health insurance plan with various add-ons (for instance, dental and vision-oriented), and tuition reimbursement (the company pays up to 1000 dollars of the employee education fees per year). Besides, the company provides discounts for its employees in the Starbucks stores and offers free food and coffee during work hours (Fechter). Thus, the provision of employee benefits has a strong positive impact on the revenues of Starbucks since the company steadily refuses to relinquish or ‘optimize’ them.

Secondly, Starbucks involves employees in vital organizational decisions, giving them significant autonomy. Instead of promoting a rigid order-based system, Starbucks trains its employees to make valuable decisions themselves. As Lemus and his colleagues show, “Starbucks provides training to employees because management believes in human capital development within the organization’s expectations” (33). In this manner, the company and its leader, who largely abstains from direct management, achieve a high level of cohesion between the customer and employee satisfaction. Employees, who are inspired by the autonomy and the benevolent attitude towards them, do their best to satisfy the customers. Besides, the progressive nature of the company undoubtedly attracts some of the most conscientious clients. Instead of choosing companies such as McDonald’s, which propose cheap coffee, they may turn to Starbucks due to its ethical employment practices. Thus, the transformational leadership approach can be a significant success factor in the modern world.

Transformational Leadership Downsides

Despite the obvious positives of the transformational leadership style, it is far from being perfect. The first problem stems from the restricted nature of the environment within which the transformational leadership model can function. In this regard, even a single indication of falsehood on the part of the management can destroy the organizational cohesion and undermine the vital follower-leader connection (Czaja). A baseless by the book application of the framework is likely to end in a disaster due to the lack of motivation on the part of the managers and their attempts to mask authoritarian leadership behind progressive terms and concepts. Transformational leadership needs genuine leaders, who are not abundant in the modern profit-driven corporate world (Czaja). Secondly, the approach requires constant communication between the leader and the employees. If it is lacking, the average workers can start perceiving the goals of their corporation as fake. Therefore, the approach requires more than one transformational leader within a particular company. The whole organization has to be trained to follow the model; more importantly, the inspirational managers must be handpicked. Lastly, transformational leadership will likely require massive investments into employee benefits to create a correlation between the goals of the company and its real actions (Czaja). Ultimately, all three elements require either massive investments or luck, being unavailable to the majority of businesses in the US and the world; transformational leadership is a luxury today.

Besides, the transformational approach can become problematic due to the personality of the leader. Regrettably, the approach can be used for negative goals, such as the promotion of hate-based ideologies or religious extremism. Using his or her charisma, a negative transformational leader can push many people towards genuinely unethical activities. According to experts, Hitler, the infamous leader of the Third Reich, reflected a perfect example of a negative transformational leader (Czaja). Through his charisma, he managed to mold the majority of the German citizens into bigoted xenophobes. Ultimately, his armies (including both the regular Wehrmacht and the SS battalions) have committed countless atrocities against Jewish and Slavic people, following the belief of their leader in the inferiority of non-German nations. Similarly, a charismatic but unethical leader can push a pharmaceutical company, for instance, towards experimentation on humans, justifying his or her horrific insistences by utilitarian ethics. As long as the leader is charismatic and genuine, such an occurrence may be possible. Thus, the employees and the shareholders must always closely monitor the leaders to discover and prevent genuinely monstrous propositions on their part.

Future of Transformational Leadership

Most likely, the complexity of various organizational tasks and technology will continue to rise in the future. Consequently, the organizations will become too large for any leader to control. Even though transformational leadership already involves a great deal of autonomy, it requires some personal involvement and direct control on the part of the leader. Thus, future businesses are likely to see the transition towards frameworks with almost complete autonomy of the employees. In this regard, the most efficient model would be to give only general directions to the workers, trusting that they will perform the rest of the work efficiently. Robert Greenleaf developed the leadership system that can achieve such an outcome. Contrary to the organization- and value-centered concepts, his idea of servant leadership puts “the needs of followers and stakeholders first” (Hoch et al. 506). The servant leader is aimed at supporting the aspirations of his or her employees, rather than shaping them. Thus, he or she rules by using the respect of his or her colleagues, their genuine readiness to accept the values of the person that helps them. Essentially, servant leadership is a democratic version of the already autonomous transformational approach. Spears “identified 10 characteristics of servant leaders, including listening, empathy, healing, awareness, persuasion, conceptualization, foresight, stewardship, commitment to the growth of others, and building community” (Hoch et al. 507). Therefore, the future of leadership is going to transition towards the community-oriented models even further. In the future, authoritarian corporations of the old times will transform into the genuine beacons of democracy and corporate autonomy.

To summarize, the current developmental trends of humanity call for the rearrangement of its approach to leadership. In the past, authoritarian approaches worked due to the low complexity levels of social and scientific knowledge. Usually, a leader was confined to small groups of people with low education standards. Besides, the scientific tasks, while challenging, were more or less resolvable without significant outside help. Over the 20th century, however, the complexity of tasks has grown, pushing the majority of organizations away from the increasingly inefficient authoritarian models. One person or a small group of experts is no longer capable of handling the challenges of the modern business world. Transformational leadership offers a resolution to this problem by utilizing the increased education level in the majority of the world to promote a semi-autonomous model of business organization. Even though this type of leadership still requires some authoritarian decisions, it represents a vital departure from the manager-centric approaches by creating a secure interconnection between the management and the employees, as well as promoting self-sustainable worker-led regulatory institutions within modern organizations. Nonetheless, the possibility of the negative transformational influence and the continuation of complexity growth will likely require another radical transformation, with a servant approach becoming the critical trend in Leadership Studies.

Works Cited
Czaja, Je. “The Trouble With Transformational Leadership.” Small Business, Chron.com, 21 Nov. 2017, https://smallbusiness.chron.com/trouble-transformational-leadership-21793.html.

Fechter, Josh. “Starbucks Employee Benefits Review: Are Their Careers Worth It?” FutureFuel, https://futurefuel.io/employee-benefits/starbucks-careers/.

Ghasabeh, Mostafa Sayyadi, et al. “The Emerging Role of Transformational Leadership.” The Journal of Developing Areas, vol. 49, no. 6, 2015, pp. 459–467., doi:10.1353/jda.2015.0090.

Hoch, Julia E., et al. “Do Ethical, Authentic, and Servant Leadership Explain Variance Above and Beyond Transformational Leadership? A Meta-Analysis.” Journal of Management, vol. 44, no. 2, 2016, pp. 501–529., doi:10.1177/0149206316665461.

Lemus, Edel, et al. “Starbucks Corporation: Leading Innovation in the 21st Century.” Journal of Alternative Perspectives in the Social Sciences, vol. 7, no. 1, 2015, pp. 23–28.