Transactional vs Transformational Leadership in Change Management
Leaders play a crucial role in steering organizational change and inspire or stimulate people for achieving excellence at work by realizing the pre-defined goals. Effective leadership provide a direction and vision to the people from top to bottom, develops a conducive culture, climate and values for enabling certain expected code of conduct or behaviour out of employees.
Leaders conceptualize and administer suitable strategies for driving continuous improvement in the existing processes, motivating employees for superior performance and facilitating change across various functionalities.
Leaders play both transactional as well as transformational roles depending upon the organizational context, environmental factors and the long term objectives.
Transactional Leaders work in accordance with the predefined modes of operation and are more concerned about ensuring a continuity in the day to day functioning, ensuring seamless operations by establishing systems and processes in place and focused towards achievement of set targets.
Such leaders can enforce disciplinarian actions, establish a systemic framework and define a road map of action, formulate & implement policies and motivate superior performance through a systems of rewards and incentives.
A Transactional Leader is not concerned about the futuristic vision or strategies for acquiring market leadership, but is more concerned about ensuring that the tasks assigned are completed on priority by meeting the quality benchmarks.
It would be more appropriate to say that the Transformational Leaders are the real champions of change. They are the visionaries who influence or motivate teams for achieving excellence in business performance.
Transformational leaders give more importance to the development of cohesive teams and facilitate an environment of collaboration for achieving the next best level of performance, instead of ensuring the completion of day to day organizational duties/tasks.
The focus is more on team building, empowerment of employees, alignment of individual-organizational goals and culture building for motivating individuals to embrace the change for the better.
Given below are the key functions performed by the Transformational Leaders:
Transformational Leadership: Advantages and Disadvantages at Work
Examples of Best Practices of Transformational Leaders in Business
Transformation in Technology: Various Technology giants like Apple, Microsoft, Intel, IBM and many others, revolutionized the computing world through technological innovation by introducing state of the art quality software applications and microprocessors. Even the world of internet has witnessed a change in the contemporary scenario with Google enjoying its leadership as the most effective search engine and Amazon & e-Bay leading the e-commerce platform.
Transformation in Financial Services Industry: Due to the internet revolution, the financial services industry is undergoing a sea change with the availability of online platforms for the investors for planning their investments independently, researching, trading stocks and investing in various financial products by being in any part of the world.
Pioneers like Peter Lynch, proponent of Mutual Funds and John Bogle, proponent of Index Funds, changes the attitude and preference of the investors on various financial portfolios. Today, Mutual Funds and Index Funds have become the most preferred choices for the investors because of the low costs involved and diversified benefits.
Diversification: In the era of globalization and liberalization, the organizations follow diversification strategy for business expansion across the globe and maintaining a leadership edge in the competitive market. Leaders like Jack Welch, the CEO of General Electric during 1980s, restructured the entire organization from the traditional bureaucratic set up to a more agile and lean framework.
Other Examples include Business Process Outsourcing and Knowledge Process Outsourcing which has resulted in generation of cost advantages for the organizations and enhanced business efficiencies, increased job opportunities for millions of people across the world and revolutionized organizational functioning as a whole. Again quality tools and processes like TQM, Kaizen, Six Sigma, etc have led to continuous improvement in business operations and achievement of superior quality benchmarks in manufacturing practices.
- Kinds of Change & Barriers to Change
- Pre-Requisites for Successful Change Management
- Overcoming Barriers to Change
- Senior Managers as Barriers to Change
- Reasons for Resistance to Change
- Individual and Organizational Sources of Resistance to Change
- Techniques for Overcoming Resistance to Change and Selection of Appropriate Technique
- Financial Crisis & Organizational Change
- Complexities in Driving Change
Authorship/Referencing - About the Author(s)
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