Political scientist James MacGregor Burns was the first to define the term ‘’transformational leadership’’ in 1978 as a process through which “leaders and their followers raise one another to higher levels of morality and motivation.” But what is transformational leadership, and how is it different from other styles, such as transactional leadership, in the Indian context?
Transformational leaders, just like other leaders, inspire and influence their team members to achieve business or personal objectives. However, the key factor distinguishing transformational leadership style from other styles, such as autocratic and transactional leadership, is that it positively influences people’s behavior, ethics, values, and morals.
In this blog, you will learn:
- How do transformational leaders inspire and motivate their teams?
- How can transformational leadership contribute to the success of businesses?
- What are the key characteristics of transformational leaders in the corporate world?
- Transformational Leadership vs. Transactional Leadership
- How do Indian statistics support the effectiveness of transformational leadership?
How Do Transformational Leaders Inspire and Motivate Their Teams?
According to Jay A. Conger and Rabindra N. Kanungo’s three-stage model, leaders can facilitate transformation by examining the status quo and identifying risks or issues. Therefore, leaders identify, visualize, and communicate goals based on their shortcomings to the team. Moreover, they gather people’s trust and explain why and how the goal should be attained.
Let’s understand a few specific ways or practices Indian transformational leaders use to motivate their teams:
1. Leading By Example
Transformational leaders act as role models to their followers and lead by setting examples. They, in fact, take ownership to attain a specific goal, demonstrate intellectual authority and creativity, and practice responsible entrepreneurship, thus inspiring their followers.
2. Delegating Responsibilities
Transformational leadership qualities inspire and motivate team members by delegating responsibilities to members based on their skills. In addition, transformational leaders also provide autonomy to team members and avoid micromanagement.
3. Goal Setting
Goals play a crucial role in transformational leadership theory. Transformational leaders set difficult yet achievable goals to motivate their team members. There are three main ways how they inspire people to achieve their goals:
- Ensure team members understand the importance and value of a specific goal
- Encourage team members to look beyond their self-interests and focus on a common goal
- Act as a role model and guide followers to attain the vision
Another main reason transformational leaders can inspire others is their charisma and dedication. They, thus, build a vision of a collective future and provide a sense of purpose to their followers.
4. Intellectually Stimulate Followers
Research by Bakker and others suggests that transformational leaders have the ability and skill to intellectually stimulate their followers through their thoughts, actions, and values. They also question people about their way of working and offer new perspectives. Through this, they can challenge their followers and help them perform better. Some notable transformational leadership examples include Ratan Tata, Azim Premji, and Nandan Nilekani.
5. Cater to the Needs of Others
While transformational leadership emphasizes a common goal, leaders must also ensure that the personal goals of the followers are met. In fact, this is one of the distinguishing factors in the transformational leadership vs. transactional leadership debate. In a nutshell, transformational leaders identify the strengths and weaknesses of their followers. They acknowledge their followers’ skills and abilities, understand their goals, uplift them, and encourage them to aim higher.
Transformational Leadership vs. Transactional Leadership
Burns, in his book on leadership, classifies leadership into two main categories—transactional and transformational leadership. The difference between transactional and transformational leadership is that the former style offers incentives or consideration in exchange for getting the work done. Conversely, transformational leadership is based on motivation and morality. It aims to positively change the work environment by helping the team focus on a greater vision.
Another key point in the transformational leadership vs. transactional leadership debate is that the former focuses on innovation and growth. Transactional leadership, on the other hand, emphasizes on business continuity and productivity.
Interestingly, transformational leadership qualities have been deep-rooted in the Indian business environment for decades. Indian moral values focus on two crucial aspects—Dharma and Karma. These are positively related to transformational leadership. Karma is an action performed for the better good, without attachment or expectations; dharma focuses on morality and an ethical code of conduct.
Dharma and karma, essential transformational leadership examples, help business leaders develop values like commitment, trust, and creativity, leading to success. It also inspires business leaders to grow their businesses and perform Corporate Social Responsibility (CSR) activities.
How Can Transformational Leadership Contribute to the Success of Businesses?
Now that you understand the difference between transactional and transformational leadership let’s see how the latter is relevant for businesses:
1. Promotes Creativity and Innovation
Transformational leadership promotes a culture of creativity and innovation within the organizations as it nurtures human resources and motivates them to navigate complex business issues.
2. Boosts Organizational Growth
Moreover, as transformational leaders inspire and influence people at the workplace, they foster positivity, collaboration, and team spirit. Furthermore, it helps boost employees’ productivity and facilitates organizational growth.
3. Set Goals
Transformational leaders set clear, specific, and attainable goals for the organization. Needless to say, this helps create a definite path for the organization to grow.
What are the Key Characteristics of Transformational Leaders in the Corporate World?
Transformational leadership style comprises the following four key characteristics, also called the four Is. All of these are critical in the corporate world:
4. Idealized Influence
Corporate leaders have charisma, allowing them to serve as role models to their teams. They can influence people because of their powerful personalities and the principles they follow.
5. Inspirational Motivation
In addition to being influential, corporate leaders are also excellent motivators. They build and communicate a vision to their team members so that they can inspire and motivate them to keep organizational goals as a priority.
6. Intellectual Stimulation
Transformational leadership means bringing positive change. Such leaders facilitate change by intellectually challenging and prompting their team members. They ask difficult questions and encourage them to think outside the box. This is one of the key characteristics of transformational leaders in the corporate world, as they inspire and motivate the team to find innovative solutions.
7. Individualized Consideration
One of the main attributes of corporate leaders is that they introduce a spirit of unity and belongingness among their team members. This makes everyone feel valued and motivates them to attain a common goal. However, it requires leaders to connect with team members individually and assess their skills, shortcomings, and personal and professional goals.
Other specific characteristics of transformational leaders in the corporate world include:
- Organizational Consciousness
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How Do Indian Statistics Support the Effectiveness of Transformational Leadership?
According to PwC’s 26th Annual Global CEO Survey: India Perspective, 40% of the CEOs believe they need to transform to make their business survive after 10 years. Therefore, this statistic shows frequent disruptions in the business environment, and organizations must transform their models and strategies to grow. In fact, this is where understanding the transformational leadership meaning becomes essential to adapt to the fast-changing needs of businesses.
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To conclude, transformational leadership is one of today’s most popular leadership styles. Such leaders can help organizations grow successfully even in hypercompetitive business environments. If you’re also wondering how you can make your organization navigate the complex challenges of the digital business environment, worry not: Emeritus offers several online leadership programs that provide you with the latest skills and relevant industry insights you need to boost your career. Explore these leadership courses from Emeritus today.
By Sneha Chugh
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