Transformational leadership is a popular management approach in many companies that has been around for many years. However, the criticism is that it is no longer up to date. For academia, the main focus is on effectiveness and the decisive factor is which success factors are used.

By Maria Frick

Transformational leadership has been at the centre of management development and corporate practice for years and has always been very popular in leadership research. Last but not least, Germany’s largest logistics and mobility group introduced the transformational leadership culture very prominently in its change process. At the same time, the question is repeatedly asked whether there are not more innovative management styles and whether these are more effective. Those are called authentic or service-oriented leadership. So- how effective is transformational leadership and has it already become obsolete from a scientific point of view?

When it comes to managing dynamic and complex situations, many speak of transformational leadership. The American business psychologist Bernard M. Bass, who significantly shaped the concept of leadership, summarises the most important features of this leadership style in four dimensions (Bass / Riggio, 2006). A transformational leader:

• acts as a role model
• motivates inspiringly
• stimulates intellectually
• supports everyone individually.

In addition, these four dimensions are united by a common goal; namely to fundamentally change, i.e. transform, the thinking, emotions and ultimately the motivation of employees.

Correlation with entrepreneurial success

In his fundamental work (1985), Bass argued that transformational leadership is the most effective leadership style. With more recent meta-analytical empiricism from 2004, T. Judge and F. Piccolo confirmed this by demonstrating a slightly higher correlation with entrepreneurial success factors. In the latest meta-analysis from 2018, Hoch and colleagues also show a positive influence of transformational leadership on entrepreneurial performance measures. A medium effect is shown on work performance (r=0.27), a stronger effect (r=0.42) on general job satisfaction and the two largest effects on satisfaction with the manager (r=0.8) and perceived effectiveness of the manager (r=0.79).

Building on the findings of their meta-study, J. Hoch and colleagues (2018) are also researching newer leadership approaches that can be introduced either as a replacement or supplement to transformational leadership. They are researching the approaches of service-oriented, authentic and ethical leadership and show that for all three leadership concepts studied, a slightly positive explanatory contribution can be shown, which also varies greatly depending on the outcome variable under consideration (Biemann/Weckmüller, 2019). The greatest influence can be seen in servant leadership, the effectiveness of which is also particularly pronounced when job satisfaction and commitment to the organization are used as performance measures (Hoch et al. 2018).

But is servant, authentic or ethical leadership really a new and different style of leadership from transformational leadership? To answer this question, researchers Biemann and Weckmüller conduct methodical analyses of correlations between the measured leadership concepts. Their results show that ethical and authentic leadership cannot be clearly separated from the concept of transformational leadership. The concept of servant leadership correlates moderately with transformational leadership and can be distinguished from transformational leadership accordingly, so that it can make an additional contribution to explaining leadership success.

In summary, transformation leadership is still the most effective leadership style according to science. Transformational leadership enhances the job performance of employees as well as their satisfaction. However, when we look more closely at practice, transformational leadership is sometimes difficult to apply because you have to give time and space to lead people. A great deal of time and attention is given to understanding and transforming employees with their needs and goals so that they achieve performance that exceeds expectations. 360-degree feedback, employee surveys and management audits can be used to measure the success of leadership in your own company.