How transformational leadership drives business success

Inspiring professionals who motivate teams and bring out the best in each member. Welcome to the era of transformational leadership, an approach that has arrived to take companies to infinity… and beyond.

“Transformational leadership is a powerful approach that can inspire and motivate teams toward positive change.” This is how Sergio Velásquez, who holds a PhD in Engineering and Education and has more than 15 years of experience in business consulting and human resources, refers to this concept in his book ‘Transformational Leadership: Inspiring positive change in your team and organization’.

This approach is a major trend that began to develop in the 1970s and gained relevance in the 1980s. At that time, James McGregor Burns, Pulitzer Prize winner, wrote ‘Transforming Leadership’, a work in which he already referred to transformational leadership, contrasting it with the transactional style that was dominant.

Nowadays, more and more executives, managers, and professionals seeking to develop their careers are embracing this leadership style, which essentially focuses on motivating teams and fostering collaboration toward a shared goal. Below, some of the keys to this transformational leadership will be addressed.

What is transformational leadership?

This type of leadership is characterized by the following fundamental principles:

• It aims to transform organizations from within.
• A type of leadership that focuses on bringing out the best in each team member.
• Enthusiastic, motivated, and inspiring leaders who create a sense of belonging within the company.
• It is practiced by individuals who are able to positively influence a company’s employees.

Transformational leadership provides significant benefits for companies and the professionals who practice it:

• Greater autonomy for individuals within the workforce.
• It fosters a sense of belonging and commitment to the company.
• It inspires and motivates professionals to improve at both an individual and organizational level.
• It increases business productivity.

What does transformational leadership consist of?

Transformational leadership places the focus on the person who practices it—those transformational leaders who are crucial to a company’s trajectory. In fact, they significantly drive business growth by adopting this management style. But what exactly does it consist of? The following aspects define it:

• People with the ability to teach in a didactic and collaborative way.
• Confident professionals who communicate their views and knowledge in a reasoned manner.
• Patient individuals who understand that major changes take time. Haste and rushing are enemies when steering the ship.
• They pay attention to each team member, ensuring that their opinions and contributions are valued, which strengthens the sense of belonging.
• They recognize everyone’s achievements: individually, by department, or within a specific team.
• They serve as role models; therefore, they represent an inspiring figure who promotes change within organizations.
• They foster safe and motivating work environments.

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What does a transformational leader do?

Considering these factors, the functions of a transformational leader are highly valuable. Three key abilities can be highlighted in particular:

1. Increases employee performance: everything adds up. By creating a better work environment where employees can bring out their best, the organization benefits.
2. Improves the company’s image: their inspiring profile impacts both external and internal stakeholders. By improving results and influencing corporate culture and corporate social responsibility, the brand benefits from better market positioning and stands out positively from competitors.
3. Enhances the individual strengths of each team member: this contributes to employees’ personal and professional development. In addition, it creates an overall climate of satisfaction that drives future results.

Transformational leadership: a success example in innovative companies

Different types of leadership are studied in programs such as the MBA, Global MBA, and the Executive MBA at EAE Business School Barcelona. In these programs, different leadership styles are covered, with transformational leadership being one of the key topics.

To conclude, we highlight some transformational leaders who have practiced this leadership style:

• Nelson Mandela: the former South African president is a benchmark of transformational leadership due to his great charisma and ability to inspire the community.
• Satya Nadella: the CEO of Microsoft has demonstrated leadership based on empathy, collaboration, and a growth mindset. He has transformed the company’s culture by fostering innovation and teamwork. His approach has strengthened employee engagement and the evolution of Microsoft.
• Oprah Winfrey: prominent in the media industry, she is a role model for her communication style, empathy, and ability to inspire and motivate her teams.

As can be seen, there are countless inspiring cases that serve as examples of transformational leadership; people who know how to get teams rowing in the same direction and who lead organizations and companies in a more kind and empathetic way toward colleagues and the environment.