The interest in transformational leadership over the last three decades is a result of the global economic changes of the early 1970s, when organizations had to consider radical changes in their ways of doing business. Factors such as rapid technological change and changing demographic structures created a turbulent, unstable, and competitive environment in which significant organizational change was imperative.
Due to the effects of globalization, companies needed new leadership approaches to solve the seemingly contradictory challenge of finding new ways to affect change while building employee morale (Congers, 1999). The theoretical basis of the work on leadership that prevailed in the 1970s was based on explorations of traits, behaviors and situations (contingency theories) and did not take into account some “atypical” qualities of leaders. During the last decades great organizational, social and cultural changes have taken place. Globalization and technology have caused a reorganization of the supply chain and the work chain accompanied by new forms of learning and knowledge exchange. The changes and challenges led to various explorations on leadership theory in search of effective leadership models for the new era in which people ask for changes but do not have a clear path to do so.
Leadership theories, such as transformational leadership, have been developed in an attempt to describe new phenomena, predict what will happen, and suggest strategies for effective leadership. Transformational leadership theory among all existing theories is the one that underlines the importance of changing the mindset of subordinates, building trust for the will to internalize organizational values, and encouraging the follower to become a leader. In today’s changing global environment, the problems employees face often did not exist before. There is a greater need for everyone to respond to one’s unique problems in an appropriate and timely manner rather than waiting for instructions from supervisors and transformational leadership is needed to facilitate capacity.
“Transformational leadership has traditionally been defined as the deployment of the following components: charisma, intellectual stimulation, and individualized consideration.” This type of leader instills pride, faith, and respect in subordinates, promotes intelligence and problem solving, and encourages subordinates to seek innovative solutions to problems. Transformative qualities are needed in organizations today because these leaders can motivate others to achieve goals, have emotional intelligence, have self-control, enthusiasm and persistence, and are able to motivate themselves. Personal performance vulnerabilities would be the inability to make quick changes to help an organization.
Due to globalization, one can become vulnerable to competition. In a changing global business environment, leaders can feel powerless if an organization does not allow change due to structure. The sources of risk today are less predictable and this becomes a challenge for leaders (Tamosiuniene & Saveuk, 2007). Leaders are always at risk due to the changing business environment. If an organization is decentralized or organic, this will make things easier because a leader would be able to react quickly to a changing global business environment. Not all organizations are decentralized or have organic structures.
Globalization, technology, changing markets and competition have created uncertainty (Tamosiuniene & Saveuk, 2007). Improving emotional intelligence is an important requirement for effective leadership. To improve emotional intelligence, ways must be found to incorporate emotional intelligence skills into one’s personal toolbox to enhance career success. According to Ashkanasy (2002) to improve one’s own emotional intelligence and the emotional intelligence of employees, five tips are given for a better management of emotions. For example, one piece of advice is that managers should assess the emotional impact of employees’ jobs and design work assignments with this in mind. The effective application of the leadership principles would result in a positive change in the strategies and effectiveness of an organization.
As a transformational leader who increases individual and team effectiveness, implements innovation, drives creativity, improves communication and problem solving, it would take being ethical to bring about positive change in an organization.
References
Ashkanasy, New Mexico (2003). Studies of cognition and emotion in organizations: Attribution, affective events, emotional intelligence and emotion perception. Australian Journal of Management, 27, p. 11-20. Retrieved on February 27, 2008
Conger, JA (1999) Charismatic and transformational leadership in organizations: An insider’s perspective on these developing research streams. Quarterly Leadership. 10(2), p. 146-179.
Tamosiuniene, R. & Saveuk, O. (2007). Risk management in the Lithuanian organization- Relationship with internal audit and the quality of financial statements. Business: Theory and Practice, 8(4), p. 204-213. Retrieved February 16, 2008, from the EBSCOhost database.
Tucker, ML, Sojka, JZ, Barone, FJ, and McCarthy, AM (2000). Training tomorrow’s leaders: Improving the emotional intelligence of business graduates. Journal of Education for Business, 75(6), p. 331. Retrieved February 27, 2008, from the EBSCOhost database.