Friday, January 25, 2013

Transformational Leadership Encourages Innovative Workplaces

Leadership requires the ability to not only develop new organizational functions to meet market needs but also develop employee empowerment to create higher levels of synergistic energy. When leadership creates innovation, an organization continues to develop, invent, produce, and overcome market challenges. Transformational leadership are seen as influential, inspirational, motivational and humanistic (Avolio & Bass, 2002) and have the highest chance of create great levels of change. The article below will highlight the nature of transformational leadership and its impact on innovation within the modern workplace.

It is beneficial to understand what innovation looks like within the workplace. Innovative work consists of 1.) Recognition of the problem, 2.) idea generation, 3.) promotion, and 4.) realization (Janseen, 2000). Solving problems in the organization creates higher levels of performance. The larger the problem the more difficult it is people to become “tuned in” to the issues. Thus, the components are often recognized in idea generation, the concept is then promoted through concerted effort and finally a realization of the solution is found once all the components have been understood and connected.

In terms of leadership, such activities and behaviors are promoted within the workplace. This includes the ability to think freely about concepts, experiment and fail. Yet before employees will be able to use their intellectual capacities, they should be prepared through higher skill development (Janssen, 2000). When skills meet tacit and implicit management approval, the atmosphere can become more conducive to change. Such change has the ability to create internal corporate entrepreneurship that seeks to promote the self through organizational achievement (Sharma & Chrisman, 1999). 

The transformational leadership style appears to be one of the most advantageous management styles to encourage innovative work behavior among subordinates (Janssen, 2002). As a runner up to the transformation style in developing an innovative workplace is the transactional leadership style. Such leaders focus on setting objectives, monitoring and controlling outcomes (Avolio & Bass, 2002). Each style promotes a level of accountability of results but does not overly control the work process.

The best leaders are like farmers who sprinkle their workers with inspiration and motivation through self-development. They assist their subordinates through their performance, abilities, and individual qualities by using motivational inspiration that seeks improvement (Bass & Avio, 1990).  When leaders take the preferred transformational leadership style, they have been found through research to increase work unit effectiveness by using innovation development (Judge and Piccolo, 2004). This encouraging style furthers the development of higher levels of personal achievement. 

Modern companies are not the only place that transformational leadership and innovation are helpful. Governmental agencies, colleges, and schools are also in need of change and hedging of human capital. Such transformational leadership have been found to improve innovative work behavior in school, colleges and universities (Abbas, 2010). At a time when universities have become expensive and under the spotlight it is the transformational style and the employees’ abilities that make a difference in their continued viability. 

To highlight the point of transformational leaderships strength over other leadership styles a study conducted of 100 bank managers in Pakistan found how effective the leadership styles of transformational, transactional, and Laissez fair styles were in developing workplace innovation. The study used the Multifactor Leadership Questionnaire at both public and private financial institutions. It was found that transformational leadership was the strongest in fostering innovation while transactional leadership ran a distant second place (Khan, Aslam,& Rias, 2012. The laissez faire style was not correlated strongly with innovation. Thus, transformational leadership was better suited to fostering new ideas and problem solving on an organizational (Bass & Avolio, 2000). 

There are many components that work to create the most effective and innovative workplaces. However, leadership sets the tone of the workforce by encouraging the development of human capacities. Other leadership styles have some limitations through their behavioral modeling and control mechanisms that limit the potential of employees. Innovation requires a level of free thinking, environmental scanning, and experimentation that is difficult to achieve if strict procedures or control based mechanisms are used heavily. 

Abbas, G. (2010). Relationship between transformational leadership and innovative work behavior in educational institutions (Unpublished MS Thesis). Department of Psychology, International Islamic University, Islamabad.

Avolio, B., & Bass, B.(2002). Developing potential across a full range of leadership: Cases on transactional and transformational leadership. Mahwah, NJ: Lawrence Erlbaum.

Bass, B., & Avolio, B. (1990). Multifactor leadership development: Manual for the Multifactor Leadership Questionnaire. Palo Alto, CA: Consulting Psychologist Press.

Janssen, O. (2002). Transformationeel leiderschap en innovatief werkgedrag van medewerkers: een kwestie van benaderbaarheid van de leider. Gedrag and Organisatie, 15, 275-293.

Judge, T., & Piccolo, R. (2004). Transformational and transactional leadership: A meta-analytic test of their relative validity. Journal of Applied Psychology, 89, 755-768.

Khan, M., Aslam, N. & Rias, M. (2012). Leadership Styles as Predictors of Innovative Work Behavior. Pakistan Journal of Social and Clinical Psychology, 9 (2). 

Sharma, P., & Chrisman, J. (1999). Toward a reconciliation of the definitional issues in the field of corporate entrepreneurship. Entrepreneurship Theory and Practice, 23(3), 11-27.

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