James MacGregor Burns coined the phrase 'transformational leadership' while conducting researches on the political leadership. More researches done by Burns in 1978, and then followed by Bass in 1985 concluded that the transformational leaders motivate the employees to do more than what is originally expected of them.
Various studies confirmed that these leaders influence the operational efficiency in many ways. How do they create an impact on the organizational development? The organizational growth is achieved by mentoring the employees to understand the importance of team effectiveness and its impact on the organizational goals. When the employees work toward meeting the organization’s objectives, their performance and the results automatically grow beyond expectation. These charismatic leaders play a vital role in creating a high level of job satisfaction among employees. In turn, the satisfied employees enthusiastically work very hard to improve their organizational effectiveness. These leaders develop a pool of employees who can think beyond their self-interest.
Let us look at how silicon valley became a hub of technological innovations. Steve Jobs, the co-founder of Apple, revolutionized the thought process of entrepreneurs through his disruptive technology and marketing skill. When asked about his ability to create great products, Steve Jobs responded that he looked at the products in customer perspective,of course,beyond applying high-end technical solutions. Most of his competitors focused on making products that are technically sound, but didn't give much thought on how such products are useful to the common man. Apple employees are expected to disrupt the market by creating innovative solutions.
The Organizational Behavior
The transformational leaders influence the organizational behavior in various ways.
Goal Setting: The goal setting is widely used in organizations to measure its operational efficiency. By reviewing the operational efficiency periodically, the management can track the progress made to achieve the goals. It is common for the organizations to have multiple goals. If the goals are varying or not interconnected, measuring the organizational effectiveness becomes very tough. Setting the goals is an essential task to manage the organizational behavior. These enthusiastic leaders set the clear, stable goals that are not conflicting with each other. These goals help to level up the organizational performance and in turn obtain excellent results.
Process Management: The internal and the external processes in the organization help to determine its behavior. There are times when the entities face problems in their functional departments since the internal processes are not defined properly. Overlooking at the internal processes can lead to serious business calamities. The transformational leaders spend quality time in creating the right processes to effectively manage the organizational behavior.
The Organizational Culture
The deeply embedded values, ethics, moral codes and conduct are the essential elements of an organizational culture. According to Edger Schein, a professor at the MIT Sloan School of Management, the cultural value of the organization is very important to reach its goals. The transformational leaders who possess key skills such as team work management, change management and, client management help a great deal to create a strong organizational culture. They also help the organizations to achieve competitive advantage over its rivals.
The Organizational Vision
Oakley and Kruy in their Enlightened Leadership published in 1991 concluded that the transformational leaders have a vision of leading the organization to realize its goals. Not only they posses an ability to create a vision. They also impress their employees to adopt the organizational vision and make them work toward achieving the same.
The transformational leaders create a succession plan to avoid leadership vacuums upon their exit. These leaders proactively take up ownerships on the key activities and elevate the organization to higher levels. Jack Welch, GE's CEO, is a good example to quote here. He ran the organization from 1981 to 2001 and is considered to be one of the visionary leaders who transformed GE into the best organization, among other global organizations. At the time of his retirement in 2001, there were three senior leaders who were ready to fill up the leadership void left by his departure. This seamless leadership transition helped GE to sustain its competitiveness.
The Transformational Leadership in the Overall Organizational Development
One of the fortes of transformational leaders is to identify new opportunities. They empower the entire workforce to achieve the organizational goals. The transformational leaders create a great impact on the overall organizational development by improving the commitment, potential, performance, values and productivity of the employees. How do they achieve this? These leaders act as a role model. They highly value the organizational vision, mission and the goals and reinforce these values in all their communications.
They motivate the key employees to involve in important decision-making and give them a feeling of an empowerment. The employees are always heard and responded effectively. The attitudes of the leaders impress the employees instinctively and they use their potentials and skills toward organizational development. The commitment to the organization among the common employees becomes infectious.The value of high performance is differentiated and the overall development of the organization is achieved successfully.
- The impact of transformational leadership on organizational behavior retrieved from Transformational Leadership and Organizational Effectiveness in Recreational Sports/Fitness Programs, Submitted by: Chin-Hsien Hsu, Dr. Richard C. Bell and Kuei-Mei Cheng athttp://www.thesportjournal.org/article/transformational-leadership-and-organizational-effectiveness-recreational-sportsfitness-prog
- The impact of transformational leaders on employees referred from Effect of Transformational Leadership on Followers. Affective and Normative, Commitment: Culture as Moderator by Sudha Ramachandran and Venkat R. Krishnan, Great Lakes Institute of Management at http://www.greatlakes.edu.in/pdf/gl_2338.pdf
- The Entrepreneur of the Decade, An interview with Steven Jobs, Inc.’s retrieved at http://www.inc.com/magazine/19890401/5602.html
- Transformational Leadership: The Impact on Organizational and Personal Outcomes by Roger J. Givens, Regent University Doctoral Student at http://www.regent.edu/acad/global/publications/elj/issue1/ELJ_V1Is1_Givens.pdf