Realising Transformational Leadership In Business Reality

What do French luxury fashion house Hermès, Swedish public service television company Sveriges Television, and Finnish state-owned company Arctia Shipping all have in common? All of these organisations are led by leaders practicing transformational leadership. In this post I will reflect on the applicability of the transformational leadership theory in business organisations worldwide with interesting anecdotes. Specifically, I will attempt to show that transformational leadership remains feasible in the seemingly selfish and profit driven business arena.

Ever since Bernard M. Bass (1985) extended on the work done by James MacGregor Burns and gave it a clear theoretical framework, management institutions worldwide have since characterised transformational leadership with 4 key components. These are sometimes referred to as the 4 I’s, namely:

  • Individual Consideration;
  • Intellectual Stimulation;
  • Inspirational Motivation and;
  • Idealized Attributes and Behaviours.

Beyond just profits and revenue, the world today recognises the importance of employee engagement and the critical role of leadership in ushering success.

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When asked to state what her management advice would be to other aspiring leaders, Eva Hamilton, head of Sveriges Television, warns against spontaneous decisions that undermine managers working under you. Other than prioritising the need to meet each and everyone in her team every two weeks so that ideas can be developed collectively through conversations, she also recognises the need to communicate the reasons for tough decisions (sans empty phrases) all the way through the company. Take for instance the time where close to 400 staff had to be laid off coupled with several production units shut down, Hamilton empathises with the fact that clear and thorough communication is necessary for those who keep their jobs but are experiencing sorrow and guilt. This highlights that individual consideration is ultimately to lead by not ignoring individual needs and feelings, but instead addressing them with an open and empathetic heart.

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What will be more appropriate than to look at German electronics specialist Grundig when considering the impact of intellectual stimulation? For Christian Struck, the company’s director of brand management, he believes in the encouragement of creativity of his team rather than simply instruct. Struck recognises that he works amongst very talented people and his role is to lay down the parameters of the discussion to facilitate the birth of new ideas. As such, openness and willingness to take advice from his staff and for logic to dominate decision-making is key for intellectual stimulation to be productive. Innovation and creativity hence becomes a natural output with Stuck as their transformational leader.

 

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Captain Tommy Berg helms one of Arctia Shipping’s vessels that is crucial for keeping the Baltic Sea navigable and its ports open. He believes that inspirational motivation is possible through the provision of “challenging tasks and responsibility and then letting them see it through to the end.” In my opinion, Berg’s approach is effective due to the sense of ownership that it inculcates. The trust a transformational leader places on his staff is also key in creating a working environment where people feel like they are working together towards a common goal, where tasks are fulfilling. Berg appears to execute inspirational motivation through a diplomatic management strategy where his crew is allowed to participate in the decision-making process. Berg believes this would lead to the best results.

 

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For Pierre-Alexis, Artistic Director of Hermès, his take on idealized attributes and behaviors is that while an organisation with extensive heritage anchors itself on strong familial values, a leader should concurrently “walk the talk” and cultivate an inclusive atmosphere if global presence and success is the ultimate goal. His inclusive vision is constantly actualize through his management decisions. For example, he set up a committee of key employees across the métiers to cross-fertilise thinking and help guide development. One might have the impression that fashion house giants like Hermès would surround their company with people whose surnames are Dumas, Puech or Guerrand. Upon closer scrutiny, however, this global brand has close to 11,000 employees and only 10 of those are family members with the abovementioned surnames.

 

In the examples listed, it becomes clear to me that each transformational leader practices their very personal set of business strategies and management techniques contingent to the unique contexts, albeit yielding similar and significant achievements. Particularly in identifying the change needed and realising change by enhancing the motivation, morale, and job performance of their staff.

If your goal is then to become a transformational leader, what then would be your unique style of transformational leadership? How would you ensure the applicability of transformational leadership in today’s digital age?

Closer to home in Singapore, cultural and geographical dimensions of transformational leadership become blurred as globalization renders ethnically specific collectivist and individualistic effects of organizational behavior obsolete.

With the workplace becoming increasingly diversified, would transformational leadership remain relevant? If so, will there be a need for existing theories to be revised?

Food for thought.

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