Transformational Leadership: Implications for Organizational Competitive Advantage

Abstract

There is a growing consensus among scholars and practitioners alike that maximising the potentials of human resources is central to organisational effectiveness and improved performance in the 21st century global market place of intense competition. It has also been suggested that the ways in which organisational leaders manage people can remarkably influence company performances and competitiveness. Despite this realisation however, scholars, managers and practitioners alike disagree on the most appropriate approach to organisational leadership. Indeed, there is an on-going debate about the leadership style that yields the best results for organisations in contemporary times. And whilst the debates rage, an increasingly dominant discourse is that transformational leadership is central to organisational effectiveness and gaining of competitive advantage. This notwithstanding, the most fundamental issue remains how to understand how transformational leadership practices impact on performance in practical terms. Consequently, producing an unequivocal response to the question ‘what does transformational leadership really contribute to organisational performance?’ has remained elusive. It is against this backdrop, that this article critically evaluates the concept of Transformational Leadership (henceforth TL), with a view of highlighting its contributions to organisational effectiveness and performance. Synthesising organisational and leadership theories and integrating literatures in organisational development and HR, the paper argues that there are evidences to suggest that there are clear linkages between TL, organisational effectiveness and improved performance. The paper further contends that emotional intelligence is key to the operationalization of TL and concludes that the greatest challenge remains how to quantify the contributions of TL in practical terms.