Transformational leadership: What’s next?

The concept of transformational leadership is increasingly viewed, critically. Problems in  transformational leadership are the empirically indefinable dimensions, a lack of conceptual clarity and the mixing of leadership behavior and leadership success.

Based on the fundamental studies by Bernhard M. Bass in 1985, transformational leadership has been the focus of leadership research for several decades and has also enjoyed great popularity in corporate practice for years. After successful events in football, the national coaches appear regularly in the business as role models for managers in companies. “Why superiors can learn from the Borussia coach” was the headline of the personal magazine in 2013 with reference to Jürgen Klopp, who in 2019, as a coach in Liverpool, also graced the cover of Manager Magazin. Deutsche Bahn introduced the transformational leadership culture in a particularly prominent way, accompanied by a fundamental change process (Mollenhauer / Sommerlatte, 2016).

Is the Transformational leadership the end point of leadership research?

As in practice, leadership research seems to have reached its conceptual conclusion with transformational leadership. Bruce J. Avolio and Bernhard M. Bass (1991) propagated a “full range of leadership” program at an early stage, which finally shows possible leadership styles and evaluates their effectiveness. In addition to laissez-faire and transactional leadership, four dimensions of transformational leadership form the end point of successful leadership. In practice, too, the presentation initiated by Bernhard M. Bass and Ronald E. Riggio (2006) has become widespread (e.g. Jackenkroll, 2016), although both the designations and the arrangement relate to the effectiveness of the individual dimensions of transformational leadership vary. In the basic work “Transformational Leadership”, however, there is no isolated evaluation of the effectiveness of the individual dimensions of transformational leadership, but only a category “4 I’s” is formed (Bass / Riggio, 2006, p. 9).

At the same time, criticism is expressed as to whether more innovative leadership styles are more effective. Indeed, Bruce J. Avolio and colleagues (2009) show a whole range of new leadership styles in a review article of new research approaches, such as serving or authentic leadership. Has transformational leadership become obsolete?

What is transformational leadership and how can it be measured?

Against the background of these developments, we want to take a closer look at the effectiveness of transformational leadership and any further developments. In doing so, we will investigate the following questions in particular: How effective is transformational leadership and which dimensions of transformational leadership having the greatest impact? Are new leadership styles more effective? Here we focus in particular on ethical, authentic and servant leadership, referring to a current meta-analysis by Julia E. Hoch and colleagues (2018) and the criticism of the approach to transformational leadership by Knippenberg and Sitkin (2013). In doing so, we concentrate on the average effects and do not deal with moderators, who are of great importance in the context of situational leadership theories.

Core dimensions according to the Multifactor Leadership Questionnaire (MLQ)

The management style is usually measured by assessing the direct employees, whereby the Multifactor Leadership Questionnaire (MLQ) has established itself internationally and in Germany as a measuring instrument (Felfe, 2006), which covers not only transformational but also transactional and laissez-faire leadership . There are four core dimensions for transformational leadership:

  1. idealized influence -II
  2. inspirational motivation -IM
  3. intellectual stimulation -IS
  4. individual consideration -IC

Empirically, however, the factor structure is not entirely clear and has evolved over time. The German version of the MLQ (Felfe, 2006) contains five transformational dimensions, one dimension for charismatic leadership.

Effectiveness of transformational leadership

In his foundational work on transformational leadership, Bernhard M. Bass (1985) argued that transformational leadership is more effective than the widespread transactional leadership. This assumption was empirically confirmed by the meta-analysis by Timothy A. Judge and Ronald F. Piccolo (2004, p. 759), according to which transformational leadership with a correlation of r = 0.44 has a slightly higher correlation with success variables than transactional leadership in form of goal- and performance-related rewards (contingent rewards), which has a correlation of 0.39.

However, the difference between the two management approaches is not particularly great and a combination of the two approaches is possible. A current meta-analysis by Hoch & Kollegen (2018) shows a positive influence of transformational leadership, whereby the size of the effect depends, among other things, on the parameter with which leadership success is measured: Transformational leadership has a moderate effect on work performance (r = 0.27), influences the general job satisfaction more strongly (r = 0.42) and exerts the greatest influence on the satisfaction with the manager (r = 0.80) and on the perceived effectiveness of the manager (r = 0.79).

Dimensions and their effectiveness

Uldarico R. Dumdum and colleagues (2013) take a closer look at the individual dimensions of transformational leadership. The main results are shown in Figure 3. It turns out that all five dimensions examined show high correlations with the effectiveness of leadership, the corrected correlation is consistently above 0.5, with the effect sizes in a comparatively narrow range (between 0.52 and 0.66). A slightly higher significance of ascribed charisma (r = 0.66) and idealized influence (r = 0.66) can thus be demonstrated, but ultimately all five dimensions are very important for the success of the manager.

Criticism of the approach of transformational leadership

Transformational leadership is one of the most prominent and best-studied leadership styles, so it is hardly surprising that criticism of the approach was also expressed. Daan van Knippenberg and Sim Sitkin (2013) have summarized the key points of this criticism in a highly regarded article. A first point of criticism relates to the above-mentioned measurement of the individual dimensions of transformational leadership. Obviously, these dimensions include different aspects of leadership. It is not unusual for there to be managers who, for example, have a lot of charisma, but at the same time do not distinguish themselves through individual consideration of the individual employees. In line with theory, it would be assumed that the individual dimensions should not be particularly highly correlated – precisely because they cover different facets of transformational leadership.

Empirical studies, on the other hand, show very high correlations between the dimensions. Lowe, Kroeck and Sivasubramaniam show in a meta-analysis as early as 1996 that the individual dimensions are partially correlated with one another above r = 0.80, which calls into question the differences between the measured dimensions. As a result, many researchers have combined the various dimensions into one factor without specifically addressing the individual dimensions.

Unclear separation of cause and effect

As a second point of criticism, van Knippenberg and Sitkin (2013) cite the inadequate theoretical basis for the causal relationships between the dimensions of transformational leadership and the various results such as, team effectiveness. How exactly the different dimensions work together to achieve higher team performance or satisfaction? This is where the third point of criticism follows, since there is a risk of confusing cause and effect. The mostly very high correlations between transformational leadership and satisfaction with the leader suggest that the various positive characteristics of a transformational leader are ascribed to the leader, especially if one is satisfied with the leadership style, even if the concrete leadership behavior is actually less transformational Includes leadership. As described above, the various dimensions cannot be clearly distinguished in the empirical measurements, which also points to this reverse causality: The manager is assessed as transformational because he is popular – and not the other way around. This unclear separation of cause and effect is also reflected in the last point of criticism cited by van Knippenberg and Sitkin (2013). Even if the concept of transformational leadership makes sense intuitively, there is a lack of conceptually clear delimitation of the leadership style from its consequences.

There is no panacea or magical alternative in leadership theory that would remove all of these criticisms. But even if these points of criticism are all valid, a positive effect can still be ascribed to transformational leadership overall. In the following section, we build on this and discuss newer leadership approaches that have been introduced as replacements or supplements to transformational leadership.

Effectiveness of new leadership styles

Can new leadership styles increase the effectiveness of leadership? Julia E. Hoch and colleagues (2018) investigate this question by examining the additional explanatory contribution of authentic, serving and ethical leadership compared to transformational leadership. Methodically, they apply linear multiple regressions, that is, based on the correlation between transformational leadership and success variables; they complement the other leadership styles as explanatory variables and measure their additional explanatory contribution.

There is a positive additional explanatory contribution for all three examined leadership styles, which is, however, consistently very small, but in turn varies greatly depending on the observed result variable. The greatest influence can be seen in serving leadership, the effectiveness of which is particularly pronounced when job satisfaction and commitment to the organization are used as success factors. The additional explanatory contribution of authentic and ethical leadership, however, is very small. The authors draw the conclusion from this that promoting these two leadership styles is less useful in operational practice, unless one is interested in influencing particularly specific behaviors among employees (e.g. deviant behavior).

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