James MacGregor Burns revolutionized leadership studies in 1978 with the concept of transformational leadership. In this chapter from Hickman’s book Leading Organizations: Perspectives for a New Era, Bass and Riggio provide an updated look at the topic, exploring recent criticisms and applicability. The authors draw upon several more recent studies conducted in diverse situations to convey the effectiveness of transformational leadership.
Transactional leaders use the carrot and stick method to motivate through social exchange, such as offering raises to high-performing employees. However, research leads us to question the efficacy of using money as a motivator. Transformational leaders, on the other hand, guide the way by stimulating intellectual curiosity and inspiring achievement. Additionally, transformational leaders empower team members to develop their own leadership skills by paying attention to individual needs and development. The result is that team members are often motivated to achieve more than they originally thought possible. They are also more satisfied with the results.
As Bass and Riggio point out, research shows that transformational leadership is an effective model for a broad range of fields and cultures. For nonprofit organizations—often lacking the resources to provide substantial monetary incentives—leading through mentoring, individualized consideration and intellectual stimulation is particularly important.
