Leadership Amidst a Storm: Steering a Different Course

What kind of leadership is necessary for the ship and crew to make it through the storm? This article discusses two types of leadership that can both be successful, depending on the situation. The first type works fine in stable situations. However, when big changes occur and a lot of uncertainty is involved (reorganization, for example), a different type of leadership is necessary. James Burns, who is specialized in research on leadership in American politics, was the first to describe the difference between successful leadership under stable situations and changing conditions. In 1978, he drew a distinction between transactional leadership and transformational leadership. Bernard Bass, a professor emeritus from Binghamton University of New York, has incorporated Burns’ ideas to develop a well-known model within theories on leadership.

Transactional leadership is all about exchange. In a stable situation, a leader can set up a reward structure to influence the behaviour of his or her people. An example is a bonus for salespeople who reach their targets. Another example of a transaction is a mother who negotiates with her child about the amount of TV he or she is allowed to watch after doing his or her homework. Transactional leadership then leads to expected results by using a reward system. Individual needs are subordinate as it is in everybody’s best interest to work towards the goals of the leader. Transactional leadership works really well in smooth waters.

A heavy storm changes the situation entirely. The future is no longer certain and a reward structure will no longer suffice. In order to survive the storm, a leader with strong values must step forward to motivate his or her people effectively and exceed expectations. Leaders should transform their employees by making them raise their own standards with which they surpass their self-interest. Making them aware of the moral values of the organization will further increase their interest in the common goal. This strengthens both their motivation and the bond they have with each other. Transforming the group in such a way enables them to anticipate the uncertainties of a heavy storm. This process of motivating employees is called transformational leadership.

The United States is a good example of how this process works in practice. George W. Bush put the US in two wars, created an enormous budget deficit and incited a bad image in the rest of the world. Then Obama was chosen for president. He promised change. Not only did he raise awareness on US ideals, but he also gave hope of working together to solve problems. He wants to transform people and overcome the crisis.

Bernard Bass points out four components of transformational leadership: charisma, inspired motivation, intellectual stimulation and compassion.

The first component is charisma. Charismatic leaders are characterized by self-confidence and high ethical standards. They are deeply respected and trusted by their people. They offer their people a vision of an attractive, realistic and believable future. Furthermore, charismatic leaders can state their vision and aims very clearly. The captain can lead his crew to a safe harbour if he has a clear vision of how to escape the storm and communicate this with self-confidence. For example, a manager who wants to improve the service delivery of their service desk should draw up a clear plan and communicate this to their employees.

The second component of transformational leadership is inspirational motivation. A leader inspires and motivates their people by communicating high expectations and conveying confidence that they will live up to these expectations. The leader will often use symbols and play on emotions. During the Obama inauguration, the world was given hope by a powerful speech, music and the American flag in the background.

The third component is intellectual stimulation. Employees are stimulated into considering the problems that an organization might face. The leader will challenge his or her people to generate creative and innovative solutions. An example is a manager who lets his or her service desk employees come up with ways to be even more customer-friendly.

Component number four is described by Bass as compassion, or being sympathetic towards people. This means that leaders are focussed on the needs of their people and propel them to further achievement. They also give people more responsibility and realize that each person must be treated individually. A manager could give one employee a lot of freedom, while other employees might require a high amount of structure.

Transactional leadership is based on a relationship of exchanging valuable resources, while transformational leadership is more about changing people. If the future is precarious, you need a group of people who work towards a common goal. There must be a leader who motivates and inspires people into generating solutions and is attentive to each individual. While transactional leadership may be successful in a stable situation, changing conditions call for transformational leaders who will steer a different course and lead their people to a safe harbour.