They make work more meaningful for employees and improve their performance. But they aren’t so easy to come by.

When the alarms are tripped and the sirens wail, before we panic, we look to see what everyone else is doing. The person we turn towards first is the one we perceive to be in charge. Do they understand what’s going on? Do they have a plan to get us out?

This human instinct played out in organisations all across the world this year. We all looked to our managers and company leaders to guide us through the ever changing nature of the pandemic. For a few people, they turned to someone they believed in, someone who was already making their lives better. But perhaps not in the way they think.

What makes a leader ‘transformational’?

Transformational leadership is the subject of quite a bit of scholarship. And no, we’re not just talking about super famous people – it’s not Abraham Lincoln or bust. Supervisors of varying levels of fame and anonymity qualify. 

In a much cited paper published in the Journal of Occupational Health Psychology, Kara Arnold, Nick Turner and Julian Barling describe two studies they conducted into how transformational leaders impacted the psychological wellbeing of employees. In it, they outline a theory that breaks down a transformational leader into four dimensions:

• Idealised influence – essentially leader’s ethical qualities, admirable behaviours and confidence which causes people to trust them. Also called charisma, this is what might come to mind  when you think of a role model.
• Inspirational motivation – the level to which the leader holds high expectations of their team and encourages them to achieve more than they thought possible. Someone with “vision”.
• Intellectual stimulation – the ability to get people to think outside the box and figure things out for themselves.
• Individualised consideration – the level to which a leader treats each follower as their own person, coaches them and appreciates their work.

A transformational leader should have all of these qualities, but we shouldn’t imagine they have them in equal proportions. For example, from all reports, Steve Jobs displayed high levels of inspirational motivation and intellectual stimulation, but was lacking in both consistently ethical behaviour (he apparently parked in places reserved for those living with a disability) and individualised consideration (search the web for “Steve Jobs Cruel” – I’ll wait).

This raises the interesting question of whether someone who had an abundance of one or two transformational dimensions but had zilch of the others should be considered transformational. At what point does someone crossover from a brilliant leader with less than desirable qualities into a tyrant with some redeeming qualities? There’s a reason so many companies now have policies against hiring ‘brilliant jerks’.

For HR professionals who specialise in leadership coaching and learning and development, it is worth considering the extent to which they are fostering the above four dimensions. Some of it can be trained – you can teach active listening techniques, for example – but courses focused on improving behaviour (mindfulness, resilience, etc) should also be considered. 

If you want to rethink your approach to leadership development, check out the Australian HR Institute’s leadership portal. It’s got fact sheets, tips, guidelines, case studies and more. Exclusive to AHRI members.

But before figuring out what that would look like, it’s worth understanding how transformational leaders help organisations.

Meaningful work

In the paper mentioned above, the researchers hypothesised that “the positive relationship between transformational leadership and psychological wellbeing is mediated by perceptions of meaningful work”. 

As HRM wrote recently, meaningful work is not the same as engagement or job satisfaction, but it can be a driver of both. Meaningful work is about being able to answer positively to a question such as: “Does what I do contribute to something larger than myself, and is that thing worthwhile?”. 

So transformational leaders aren’t necessarily making people happy directly, they are shaping peoples’ jobs so the work itself contributes to each individual’s wellbeing. 

Source: Journal of Occupational Health Psychology

In a practical sense, this means they are helping employees connect their day-to-day tasks to a larger narrative; giving them a role both they and others respect; making sure employees have relationships with management, colleagues and customers; and selling them on the organisation’s vision (see this article for how each of these contributes to meaningfulness).

Organisational identification and job performance

More recent research published in the International Journal of Hospitality Management found an even more complex relational structure between transformational leadership and organisational outcomes.

The following diagram is a bit academic, but it’s quite revealing.

Source: International Journal of Hospitality Management

Most of these terms are pretty self-explanatory, except perhaps for organisational citizenship behaviours. What that refers to is acts that aren’t directly performance managed or rewarded, but that nevertheless have an impact on profitability, productivity and customer satisfaction. For example, think of the colleague who proactively lets people know they won’t be available at certain times or offers to do a coffee run, or the worker who goes above and beyond to help a distressed customer.

What the diagram shows is that transformational leadership has a huge direct impact on organisational identification (which backs up the research on meaningful work) and a significant impact on work engagement. There are then flow-on effects to both job performance and organisational citizenship behaviours. 

The advantage of understanding all this for HR professionals is in enriching their evaluation of management, and their ability to improve upon it. Rather than simply asking staff to give their manager a rating, you can ask more specific questions about whether the manager helps people connect with their organisation’s mission. Rather than trying to make a one-to-one connection between team productivity and managers, you can try and see how it’s mediated by engagement.

Because the truth is there is a huge difference between a manager who people like and a manager who helps your organisation thrive. ‘Transformational’ isn’t a popularity contest, it’s a specific set of behaviours and qualities that can be measured.