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The Role of Leadership in an Organisation’s Transformational Change

The Role of Leadership in an Organisation’s Transformational Change

1. Introduction

In today’s ever-changing business environment, organizations have to adapt to the changes that are taking place in their environment. They have to undertake several transformation projects intended to realign their business processes to sustain and improve their competitive advantage. Such type of change is not without risk or challenge, but the risks can be reduced if the change is managed properly. Now change is a process and not an event. It takes time for any substantial change to be conceived, implemented, and become part of an organization’s culture. Organizations now need to be able to adapt to the changing environment and adopt a transformational approach to organizational change. There are claims in the management literature that people risk is a very important consideration in any sort of change management program because new business processes will imply changed working practices and changed job content. It is said that, in the current business arena characterized by rapid technological innovation and fast-paced competition, an organization will only survive by continually identifying and implementing significant change. This type of change can affect all or a major part of the organization; it can be strategic or a change in the mission, vision, values, or business model of the organization. However, it is organizational culture that can often be a significant barrier to any change or the facilitation of any change. However, the nature and size of the change itself and the culture of the organization also play a very important role. This is where good leadership intervenes. It not only needs to create and communicate the need for change, but it also helps the organization in its capacity by mobilizing support. This paper explores some of the theoretical approaches that are associated with transformational change and considers the unique challenges and opportunities that can present themselves when leadership skills are employed. It also explores the need that good leaders can influence and develop the capacity of the members of the organization to learn and bring about change and the realization of the collective vision and not their self-interest.

1.1. Definition of Transformational Change

Wikipedia defines “Transformational Change” as “an ongoing process of change regarding the fundamental structure of a company. It is the examination and change of the company’s vision, strategy, and the improvement of its inner, self-changing, self-mending procedures.” This definition highlights two key elements of transformational change: (1) its fundamental and ongoing nature and (2) the focus on change of vision and strategy and operational processes. In other words, transformational change involves not just small, surface-level changes. It is meant to be foundational and drastic, to the point that it requires a new vision and strategy for the organization, and it affects things across the organization from its operating procedures to its culture, to the very structure of the company itself. Klakegg et al. (2016) identified that transformational change can occur in many forms, including changes to internal processes within a company, the launch of new programs, projects, or strategies, or even external changes in leadership, or mergers and acquisitions. Fundamentally, transformational change is distinguished from other change processes by the degree to which it requires change across multiple aspects of an organization – for example, its strategy, technology, structure, skills, processes, and culture – and a fundamental re-thinking, or re-imagining of what the organization is, what it does and why it does what it does. This kind of change is drastic and it can be scary and difficult to manage. This is why authoritative figures with strong leadership skills are key to moving through change effectively and positively. Harald et al. (2013) write in the International Journal of Project Management that successful transformational change requires dedicated leadership and a clear vision that is understood from the top of the organization right down to the front line. From this, we can see that effective leadership is an essential starting point for successfully putting in place transformational change and ultimately bringing about the desired environment and organizational culture within a company. We’ll delve further into the discussion on leadership later.

1.2. Importance of Leadership in Transformational Change

Leadership plays a crucial role in the successful implementation of transformational change in organizations. As defined by Armbruster (2015), transformational change represents a fundamental and radical change that is typically triggered by a major outside force or internal crisis and requires a whole rethinking and reshaping of the organization. This type of change often has a major impact, in terms of changes in the product or services, on the people in the organization, and on the organization itself. The resources that assist the organization during a period of change are management tools, structure, technology, and most importantly: people. Leadership, whether it is through the direction of one person or many, helps to provide a clear corporate vision and it is the role of the leader to provide a supportive and motivational working culture and help to direct the attitudes of employees in a positive direction. In transformational change, a leader must direct the organization through a series of stages to achieve the result. It is the role of the leader or leaders to learn to accept and manage change, not only for the organization itself but also for themselves. This may mean being in a position of discomfort and leading by example through that period of uncertainty. However, once the management and support of that change are embraced, leaders are much more likely to be able to provide the kind of support and motivation that the staff needs to successfully progress in a positive direction. Transformational change needs to be approached by leaders and scholars alike and requires a new way of studying and understanding the changing nature of successful organizations and leadership practice. To date, most studies have concentrated either on traditional change processes and how to manage them or on organizational reactions to major ‘shocks’ including radical changes in market conditions, meteoric technology moves, and even matters such as terrorist attacks or tsunamis. However, these do not often provide a scholarly view on the new emerging and research work including dealing with changes driven by internal demands for greater productivity or efficiency, gaining from developments in web and communications technologies, and understanding the brand new range of issues that has come to the force due to real-time global commerce.

1.3. Purpose of the Study

The reason for the analysis, which is core to this venture, is to understand not only the position of leadership in a transformational change within the context of change management but also to understand how leadership affects the outcome of such projects in an organization. It is a proven fact that most people resist change, especially when it is imposed on them. The only way to ensure successful implementation of a change is to manage those involved in it. Leadership is the key factor in managing change. It is not the process of change that is so difficult, it is managing the transition. Leadership is critical to effective transition. This study may be helpful in terms of adding to the growing literature in the field of change management, as it will bring a practical dimension to the existing body of knowledge. The literature about change management is very debates-oriented; with some authors maintaining that it is a systematic, planned process while others underline the role of the individual and use a more innovative approach. This study will continue to explore a viable model in the context of a real and planned change brought about by an external factor. Such literature is extremely useful to theoreticians and theorists of extant change models. On the other hand, it will also enable practitioners to critically examine their leadership style and approach to change management. And provide a solid foundation for further development of their approach to managing those factors that could lead to the effective delivery and sustenance of change. This study will attempt to problematize some of the theory and generic ideas. It will likely examine formal systems and rational processes to change particularly more contemporary process that seeks to put individuals and values towards a more democratic process. The findings from this study would be a starting point for advancing the work on organizational development and management of economically meaningful change. Also, I hope to develop a detailed literature on change management and leadership from a practical perspective and challenge occasionally disjointed theories with sound managerial processes based on empirical learning. I believe this study will pique the interest and understanding of those in power positions about corporate change and its leadership. For the most part, the body of knowledge is being driven by academia and without much practical insight. Hopefully, this study will provide a small opportunity for managers and management scientists to come together around a common conception, proposed via empirical observation.

2. Theoretical Framework

2.1. Transformational Leadership Theory

2.1.1. Characteristics of Transformational Leaders

2.1.2. Benefits of Transformational Leadership

2.2. Change Management Theories

2.2.1. Lewin’s Change Management Model

2.2.2. Kotter’s 8-Step Change Model

3. Leadership Styles in Transformational Change

3.1. Autocratic Leadership

3.2. Democratic Leadership

3.3. Laissez-Faire Leadership

4. Challenges and Obstacles in Transformational Change

4.1. Resistance to Change

4.2. Lack of Employee Engagement

4.3. Communication Issues

4.4. Resource Constraints

5. Strategies for Effective Leadership in Transformational Change

5.1. Creating a Compelling Vision

5.2. Building a Strong Leadership Team

5.3. Empowering Employees

5.4. Communicating Transparently

5.5. Providing Continuous Learning Opportunities

6. Case Studies of Successful Transformational Change

6.1. Company A: Restructuring for Increased Efficiency

6.2. Company B: Implementing a Digital Transformation

6.3. Company C: Cultural Transformation for Innovation

7. Conclusion

7.1. Summary of Key Findings

7.2. Implications for Practice

7.3. Recommendations for Future Research


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