Transformational leaders don’t start by denying the world around them. Instead, they describe a future they’d like to create instead.” – Seth Godin

Transformational leadership is among the more recent leadership theories. It focuses on a leader’s ability to inspire followers and it does so by focusing on a vision that can change the structures around the organization. Its objective is clear when you simply look at the word the theory is built around: transform.

But how do you get people to follow a vision? Is transformational change always a good idea?

Transformational Leadership Guide: Definition, Qualities, Pros & Cons, Examples

© | alphaspirit

In this guide, we will hope to answer the above questions and delve deeper into the model of transformational leadership. We’ll start by examining the ideas behind the style, its core elements and the requirements of a transformational leader. We’ll also examine the advantages and disadvantages of the leadership theory and present you with a few examples of true transformational leaders.


To understand leadership theories, you often have to look at the history of how the model developed. Understanding the different ideas that contributed to the growth of the framework can make it easier to comprehend the modern context and use of the structure.

In this section, we’ll examine the different historical texts, which influenced the birth of the transformational theory and the ideas these theories added to the framework. We’ll also explore the current theory introduced by Bernard Bass.

The historical context

Although James MacGregor Burns is considered as the father of the transformational leadership theory, James V. Downton first coined the term. In his 1973 book Rebel Leadership: Commitment and Charisma in a Revolutionary Process, he studied the concept of charisma and it’s influence in religious leadership.

But Downton’s work remained rather unnoticed and the concept of transformational leadership didn’t take off until the publication of Burns’ Leadership. The book came out in 1978 and it examined different leadership models of the time in detail. According to Burns, most of these models focused on a transactional process, focusing on different exchanges between the leader and the subordinates.

On the other hand, he thought transformational leadership is different, as it engages the leader to form a relationship with the subordinates and ensure it motivates them and improves their moral behavior. Transformational leadership was a process in which “leaders and followers help each other to advance to a higher level or morale and motivation.”

The central focus for Burns was to identify this difference between the transactional and transformational leadership. For Burns, transactional leadership was based on the idea of give and take approach. An example would be a salary negotiation, where both sides want to find a balance between what they have to give in order to receive something. On the other hand, Burns believed transformational leadership to create a value shift between the leader and the subordinate. The leader would achieve change in the subordinate’s views through a subtle and positive manner.

The differences of transactional and transformational leadership are explained well in the below image:

The differences of transactional and transformational leadership

Based on concept from James MacGregor Burns

Burns’ transformational leadership framework saw the leader’s behavior and traits as the transforming power in empowering the subordinates and in changing the organization. The leader would be able to instill change because they were exceptional role models.

In this sense, Burns viewed transformational leadership framework as a force for good. He believed the model is linked with higher order values and strong morals; therefore, denying the style can be attributed to leaders who’ve done disastrous things in the past. In fact, Burns theory of leadership was among the first to introduce the ethical and moral dimension as a cornerstone of the theory.

Burns’ theory was influenced by Abraham Maslow’s Theory of Human Needs, which is summarized in detail in the below YouTube clip. Essentially, Maslow recognized how human behavior is based on needs and finding the way to fulfill them. The higher range of needs is what Burns was interested in, as the transformational leader needs a good self-esteem and self-actualization to succeed.

The modern context

The modern framework of transformational leadership is based on the research and writings of Bernard M. Bass. Bass extended Burns’ ideas in 1985 in Leadership and Performance. His focus was on highlighting the psychological mechanisms influencing transformational leadership and to provide a test for measuring a leader’s transformational capability. The Multifactor Leadership Quiz (MLQ) will be explored in detail in the next section.

In essence, Bass wanted to explore the ways a leader is able to influence subordinates. Bass expanded on Burns’ trait theory and emphasized the leaders characteristics in order to transform the subordinates’ view on things. While Bass believed transformational leadership to be about challenging the status quo and creating a shift in the way things are conducted, he also saw the framework could include transactional aspects. For Bass, the two leadership models were not mutually exclusive, but more of a continuum of models.

Continuum model - Transformational - transactional leadership

The above image represents the continuum and shows that while the styles are different, they are not exclusive of each other. According to Bass, a leader can operate by using all of the three frameworks, rather than sticking to one.

Nonetheless, a transformational leader would focus on changing the framework, even if he or she occasionally used a different approach. In another article titled From Transactional to Transformational Leadership, Bass criticized the transactional leadership style for implementing the “if it’s not broke, don’t fix it” approach.

According to Bass, this type of approach won’t lead to business success, but it will guarantee stagnation and problems in the long-term. On the other hand, transformational leadership will “broaden and elevate the interests of their employees”, “generate awareness and acceptance of the purposes and mission of the group” and can ensure “employees look beyond their own self-interest for the good of the group”.

In order to do so, he or she would have to use influence and charisma and provide the subordinates with a clear idea of the vision or mission ahead. In Bass’ theory, there are three different ways to transform and influence subordinates:

  • Enhancing the subordinates’ awareness of the importance and the value of the task.
  • Instead of focusing on their personal interests, the subordinates should be directed to achieve the operational goals first.
  • Activating the subordinates’ higher-order needs.

Interestingly, Bass originally concluded transformational leadership as amoral theory. This meant the vision and charisma of the leader are not always a positive force, but could and have potentially been used harmfully.

For example, leadership under Jim Jones could be characterized as transformational, even though it was horrific for the subordinates in the end. Nonetheless, Bass later changed his views on the matter, after dialogue with Burns, concluding that transformational leadership has a moral agent, which should always be used for good.


Now that we’ve explored the concepts and contexts around transformational leadership, we can turn our attention to the core elements of the model. The key elements include Bass’ four transformational components and the test he developed for analyzing a person’s leadership style.

Bass’ four components

The core idea of Bass’ transformational theory focuses on the ways a leader can change the organizational structures around him or her and to ensure the subordinates follow him.

In order for this to happen, Bass identified four components, which create the framework for transformational leadership: idealized influence, inspirational motivation, intellectual stimulation and individualized consideration. These four became known as the ‘four Is’ of the leadership style.

#1 Idealized influence

Transformational leadership rests on the idea of individual charisma. The key reason the leadership style works is due to the assumption that leaders can use their own example as a motivator for specific behavior. In essence, because the leader ‘practices what he preaches’, the subordinates will follow his or her example.

The leader is able to show conviction regarding the vision he sets out; he or she remains loyal to the cause and is willing to put him or herself on the firing line. This kind of behavior resonates with the subordinates on an emotional level and they start viewing the leader as a role model.

Through this concept of idealized influence, the transformational leader can start building relationships, which are based on trust and respect. By taking risks, following his or her core values and convictions, and showing strong moral ideals, the leader will begin to develop a sense of confidence from the subordinates that he or she is serious. This begins the process of internalizing the leader’s ideals and emulating the behavior.

#2 Inspirational motivation

The above provides the leader with the ability to spark confidence, motivation and a clear sense of purpose, which provides the framework of inspirational motivation. The framework for transformational leadership would not work appropriately, if there weren’t a constant promotion of a consistent vision and well-defined values to guide the team.

A clear vision provides the leadership the tools to outline with clarity what actions are necessary and why they can help the team reach the desired goal. Due to the lucidity in the purpose, the subordinates are constantly aware of what is required of them and what their personal purpose within the bigger picture is. This provides the subordinates with a sense of meaning, while also setting them challenges to achieve the objectives.

Transformational leadership’s motivation is based on tangible objectives and optimism about achieving them. The idea is that by creating a sense of purpose, the subordinates are more willing to work, especially when they understand what the goal is.

Furthermore, this component requires the leader to show confidence towards subordinates and support to help them achieve the goals through focus on self-development.

#3 Intellectual stimulation

Transformational leadership aims to enhance creativity and it actively seeks to promote autonomy and shared responsibility. Although it doesn’t necessarily set out a clear decision-making framework, it does tend to fall towards a more democratic model. Intellectual stimulation, which includes shared decision-making and innovation at its core, is a key component in the leadership framework.

Instead of making decisions for the subordinates and telling them what to do, the transformational leader calls for innovative thinking and ‘get it done’ mentality. Subordinates are encouraged to be in charge of their own decisions.

A big part of intellectual stimulation relies on the approach the leader takes towards problems and ideas. Subordinates are free and encouraged to solicit ideas without the fear of critique under this system. Instead of stating that a certain approach is wrong, the leader aims to change the way subordinates think about a problem and to see the different ways they could overcome the issues facing them.

Overall, transformational leadership framework is not set. If the processes are found ineffective and unhelpful in the quest to achieve a certain vision, then a transformational leader is willing to change the system.

#4 Individualized consideration

Finally, the last component of the theory is individualized consideration. Transformational leadership framework celebrates team effort, but it also understands the contributions of individuals. Furthermore, the leader should acknowledge the subordinates’ personal needs and desires, both professionally and in private life.

The theory borrows from participative leadership theory in the sense that it realizes people are motivated by different things. One approach doesn’t fit all and if the leader wants to get the most out of his or her subordinates, then there must be consideration for these specific needs.

Therefore, one-on-one coaching and mentorship are crucial for the leadership to work. The personalized training should be aimed at finding ways to reach these individual needs and to align them with the larger operational goals. The focus is not only on education and training, but also in the fulfillment of the individual need for self-actualization, similar to Maslow’s ideas.

Under the framework, individuals and their achievements are celebrated equally to what the team is able to achieve. This provides further motivation for each individual to continue focusing on self-development and to work on the personal and operational goals to the best of their ability.

Test for transformational leadership

Once Bass had established the framework for transformational leadership, he also went on to find a way to measure how deeply leaders and their subordinates at any situation showcase these characteristics. His assessment became to be known as the Multifactor Leadership Questionnaire (MLQ).

The questionnaire measures the components of leadership, with the initial questionnaire focused on Bass’ analysis of transformational leadership in his 1985 article. But the test has since been updated, although the basis is still rooted in the earlier factor analysis. The current version MLQ 5X focuses on around 26 items, which are divided into 9 scales.

The nice scales include:

  • Inspirational motivation. Tests the articulation and representation of vision by the leader.
  • Idealized influence (attributed). Examines how much charisma is attributed to the leader.
  • Idealized influence (behavior). Looks at how the leader acts upon the values of the collective sense of purpose.
  • Intellectual stimulation. Tests how followers’ beliefs are challenged and helped to analyze their problem solving.
  • Individualized consideration. Examines how the individual needs are taken into consideration.
  • Contingent reward. Studies the leaders ability to provide rewards for followers when tasks are accomplished.
  • Active management-by-exception. The scale measures how actively the leader looks for deviations from the rules and the set processes and corrects issues before mistakes.
  • Management-by-exception. This scale is only evident if the leader intervenes after mistakes have been made.
  • Laissez-faire. The scale focuses on measuring whether there is an absence of leadership.

The MLQ test provides three outcome criteria. These include the followers’ Extra Effort (EEF), the Effectiveness of Leader’s Behavior (EFF), and the followers’ Satisfaction (SAT).

The earlier versions of the test received criticism due to the limited research on the impact and framework of transformation leadership. An article on the Langston University website points out, for example, that the MLQ test was criticised for the wording it used. “Most items in the scale of charismatic leadership described the result of leadership, instead of specific actions of the leader that can be observed and that, in turn, lead to the results,” the article states.

Since then, Bass together with Avolio has clarified and modified the test. In 2003, John Antonakis studied the viability of the test and found strong evidence to suggest the MLQ5X can be a reliable way to measure transformational leadership.

The official MLQ test can be ordered from the Mind Garden website. It can be used for both research purposes, as well as for assessment and development.


As transformational leadership relies heavily on the leader’s ability to influence the subordinates and communicate his or her vision to them, it’s imperative to study the traits the leader must have. In this section, we’ll examine not only the traits the leader must show, but also the key competencies required to be a transformational leader.

Five major traits

Transformational leaders are often measured based on how much they showcase certain characteristics, referred to as the ‘Big Five’. Big Five refers to the Five Factor Model Of Personality, which examines a set of stable characteristics and measures how these influence a leader’s cognition and behavior.

The Big Five includes the following dimensions: openness to experience, conscientiousness, extraversion/introversion, agreeableness, and neuroticism/emotional stability.

Joyce Bono and Timothy Judge’s meta analysis, published in the Journal of Applied Psychology, showed how transformational leaders relate to each of these five personality dimension.

According to the findings, there is a strong correlation between the openness to experience and transformational leadership. This is not surprising, as transformational leaders are actively looking to challenge the status quo and therefore, they are constantly seeking to find new experiences.

Furthermore, the ability to be open to experience was shown to improve the leaders ability to be creative. Once more, the leader’s ability to get subordinates on board with his or her vision is necessary and requires plenty of creativity.

In regards to conscientiousness, the trait is associated with desire for achievement and the willingness to make changes in order to reach the goals. This type of behavior could be seen as essential for a transformational leader, although Judge and Bono didn’t find a strong correlation in their studies to support this idea. Indeed, the dimension was found to be more closely linked with transactional leaders and individuals who are detail-oriented. A transformational leader is often much more focused on the bigger vision rather than smaller details.

On the other hand, agreeableness links more closely with transformational leader, since it alludes to the supportive nature of these leaders. Judge and Bono found it linked with transformational leaders strongly and associated with further traits of consideration and empathy. One of the reasons the trait might have such strong relation to transformational leadership might be its connection with charisma. Agreeableness is tied with individuals who display generosity, co-operation and affection.

Extraversion was the most strongly linked personality dimension of transformational leaders. The dimension is essential for the mutual engagement of leaders with subordinates, which is why it’s a necessary part of the style. Extraverts are also charismatic and they tend to display strong communication skill, with the ability to persuade people of their vision.

Finally, the dimension of neuroticism is often linked with a person’s self-esteem and self-confidence. Neurotic behaviors tend to cause anxiety, especially in a group setting and therefore, the dimension was the least linked trait with transformational leader. Transformational leaders are looking to lead a group and not shy away from it.

You can view the results of the study from the below diagram:

Personality traits and Transformational leaderhsip

© Wikimedia Commons | Akaychestnut – Own work, CC BY-SA 3.0

Four key competencies

Perhaps more important than specific traits is the leader’s ability to show certain competencies. Transformational leadership relies heavily on the leader’s ability to ignite the subordinates and this requires a bit of skill.

Murray Johannsen, founder of Legacee and Profession in Leadership & Entrepreneurship, has identified four key competencies for transformational leaders.

  • The skill of building a skill.
  • The transformational mind-set.
  • The use of social influence.
  • The strive towards self-mastery.

The first step is to learn how to empower other people, which refers to the idea of having the skill to help others build a skill. As a leader, you shouldn’t just focus on leading by example, but you also must support and show how you perform.

The key to empowering others is following these steps:

  • Start sharing information with employees to build trust and to share knowledge across the organization.
  • Develop your vision until it is clear enough for everyone to understand. Ask advice and tweak your theories and ideas.
  • Ensure employees aren’t afraid of mistakes. Don’t criticize or punish your subordinates for trying.
  • Celebrate the successes and the failures. Teach employees that both success and failure are opportunities for growth and learning.
  • Allow teams to form their own hierarchies and let employees take accountability for their actions.

Your next competency development should focus on the transformational mind-set, i.e. thirst for change. Again, the key is to create a strong vision and idea of what you want your leadership to look like. Examine things such as what success and failure mean to you and how you want to lead. Transformational mind-set also requires you to be aware of your strengths and weaknesses. If you aren’t aware of your own characteristics and qualities, it will be hard to change other things around – transformational leader is always able to see beyond smokes and mirrors.

As a charismatic leader, you need to enhance your ability to influence people. A great place to start improving this competency is by reading the 1959 book The Bases for Social Power by French and Raven. The classic article identifies five forms of power, showcased in the below picture:

The 5 forms of Power(1)

Based on “The Bases for Social Power” by French and Raven

Under the model, each system of power will influence your leadership. For a transformational leader the understanding of each power model is important because you might need to implement all of them at one point or another. The ability to use each power model will need different tactics. For expert power, you’ll need to enhance your knowledge and understanding of the structures around you. On the other hand, coercive power requires the development of authority and the ability to punish people in a fair but concise manner.

Finally, you’ll need to develop the competency of striving towards self-mastery, the continuous development of the self. The competence relates directly to transformational leadership’s key building blog: Maslow’s Hierarchy of Needs. Once you have your basic needs fulfilled, you need to start working towards the final stage: self-actualization.

How can you continue working towards these goals while juggling with work and personal life? Learning skills and improving your understanding of the self is not easy, but it also isn’t hard. Free tools online can provide you the option to focus on self-actualization even during stressful times. The key to self-development is to understand it is a journey. A journey you can take together with your colleagues and friends.


As transformational leadership is about inspiring subordinates to follow the vision of the leader, the framework can be highly fruitful. In this section, we’ll examine the benefits of the leadership in detail. Nonetheless, while the leadership theory brings plenty of positives to an organization, the framework is not always force for good. Therefore, we will also outline the downside to transformational leadership.

Advantages of transformational leadership

Let’s start by peering at the positives. The first clear advantage of transformation leadership is engraved in the name itself: transformation. The framework is aimed at creating change, and in business, the need for change is inevitable.

As we mentioned earlier in the guide, a stagnant approach to running a business can lead to problems. Examples of this kind of behavior are plentiful. For example, consider the phone giant Nokia. For a long time it ruled mobile sales, but it didn’t continue to innovate quickly enough and once the iPhone entered the market, the company was too slow to follow. Transformational leadership can remove this behavior from a company, as it puts change and innovation to the core of what the organization does.

The reason transformational leadership is effective in implementing change is due to its focus on a clear vision. A transformational leader is supposed to create a clear vision of the change the organization needs, which will make it easier for the subordinates to follow it. The framework helps an organization define its objectives clearly and create structures that support the vision.

Learn how to draft a clear company vision by watching this video.

Furthermore, the leadership theory tends to strike a balance between short- and long-term objectives. Since the framework focuses on meaningful and achievable objectives, it starts the long-term process by establishing short-term objectives to keep things going. Transformational leadership adds focus to an organization by understanding the key actions that need to be taken, without forgetting about the future goals the organization wants to achieve.

In addition, the style is effective because it doesn’t just set out the objectives it wants to achieve, but the leader has an important role in supporting the subordinates in achieving this goal. The leader’s example provides motivation and inspiration for the subordinates, with a focus on pushing employees to higher standards. As mentioned above, transformational leadership provides the subordinates with opportunities for growth, both personally and professionally.

Transformational leaders need to have integrity and high emotional intelligence. The empathy towards other people can help create meaningful relationships with others and ensure the leader-subordinate relationship is built on mutual respect and trust. These two qualities are crucial for creating a collaborative environment, which is passionate about achieving tasks.

Ronald E. Riggio, psychologist and leadership expert, pointed out in an article published on the Psychology Today website, how studies have shown groups with a transformational leader exhibit “higher levels of performance and motivation” compared to other types of groups. Subordinates under the leadership style have more support and options for personal development. While they might not be as involved in decision-making as in certain other types, there is still the notion of being part of something. The sense of community is often a powerful motivator for people. In essence, the increased motivation can boost a company’s profitability.

In terms of operational efficiency, another big benefit to the style comes from how it creates other leaders with transformational qualities. Since individuals are using self-motivation and self-actualization as part of their work, they can use these talents to become transformational leaders themselves. In the event of the current leader leaving, the organization might have a line of potential leaders ready to take on the role.

Furthermore, the leadership framework emphasizes collaboration instead of personal gains. Psychological studies, such as the Game Theory test, have repeatedly shown that co-operation is more effective in achieving goals compared to a more competitive approach. Transformational leadership’s focus on creating a common vision to work towards can result in faster results and more deep-rooted change within the organization.

Since the leadership style is focused on change, it naturally suits organizations that are in need of transformation. Failing businesses, start-ups and companies lacking a vision can benefit immensely from the above advantages.

Disadvantages of transformational leadership

There are certain problems and disadvantages to the theory as well. Perhaps the main issue deals with the idea that transformational theory would always act as a force for good. In fact, sometimes the transformational leader can make things worse and cause huge suffering within the structure they are hoping to change. An example of this could be Mao Tse Dung. If you look at his leadership, then it has most of the hallmarks of transformation leadership, yet the changes led to human suffering.

This essentially boils down to the problem of defining transformation. What constitutes as transformation? Even the official MLQ test has trouble clarifying this and the test could potentially suffer from the so-called test effect. The person being tested could see what factors the test is analyzing and looking for, answering with this knowledge in mind.

Furthermore, the leader’s focus on change and the vision can cause ‘reality blindness’. The enthusiastic and passionate approach can be a force for positive change, but it could also diminish the leader’s willingness to investigate things further and face up to inconvenient facts. Being driven by one’s own ideals and vision might not lead to the right results.

An element of becoming blind can also take place with the subordinates’ relationship with the leader. Since the leader creates a positive and supportive relationship with the subordinates, the subordinates’ ability to critique the leader or indeed the project might become compromised. The leadership’s enthusiastic approach can lead to overdependence, in which the team ends up chasing goals that aren’t realistic or obtainable.

The leader’s enthusiasm and his or her call for unity can also lead to conformity rather than collaboration. Subordinates might find it easier to just ‘go along’ with the leader, instead of truly buying the vision or feeling confident about the plan. If you don’t have people believing in the mission, the effectiveness of change can drastically reduce.

Similar to charismatic leadership, the transformational leader needs to use impression management as a basis for motivating his or her subordinates. But the focus on ‘leading through example’ has the downside of slipping into the territory of self-promotion. There can be a danger to become more concerned about the protection of self-image and self-promotion that the support and empowerment of subordinates fades into the background.

This video with Brian Tracy shows you how to become a transformational leader.

Transformational leadership is not an easy leadership style to implement or master. It can take plenty of experience to become truly good at creating meaningful change and therefore, teaching and learning this style can be difficult. The person needs to spend enough time understanding the concepts, gaining enough knowledge on leadership and different industries, and developing emotional intelligence. The process can therefore seem overwhelming and people might find it more comfortable to result to other types of leadership models.

Overall, for the leadership style to work and provide the above advantages, the leader must have the right characteristics detailed in the previous section. Thus, the pressure on the leader to achieve and to be able to motivate all of his or her subordinates is rather high. If the leader is unable to convince the subordinates about his or her vision, then the framework won’t work at all.


Since transformational leadership is such a powerful force for change, history has seen its fair share of transformational leaders. Leaders in sports, politics, religion and business have used the transformational style to implement their visions and change the structures around them. Examining these leaders can help understand the frameworks and characteristics of this leadership style in detail.

William Edwards Deming

William Edwards Deming is not your ordinary politician or a business guru. Yet, he showed tremendous leadership qualities during his time at the US Department of the Army after the war.

In 1928, Deming received a doctorate in mathematics and physics from Yale. He became known for his work with the US government and as the father of statistical quality control.

When World War II was ravaging the globe, Deming helped teach statistical process control techniques to military production employees in order to improve the production and help the war effort. He was determined to change the inefficient structures and make sure everything was done to enhance the support of the troops.

Once the war ended, the US government sent him to solve problems relating to agricultural production in Japan. Deming managed to convince the Japanese officials that the industrial uses of statistical methods can help improve production and boost to country’s economy. The job wasn’t easy, but Deming used his expertise and passion to get the officials on his side. As you might know, within a short while Japan became the leading industrial powerhouse in the world, much of it thanks to Deming’s methods.

Few of the most telling quotes by Deming include the following:

  • “We are here to make another world”
  • “A bad system will beat a good person every time.”
  • “Innovation comes from the producers – not from the customer.”

The quotes perfectly capture ideas of the transformational leadership. The framework is about creating a vision and the world has to constantly be willing to change in order to become better.

Nelson Mandela

Another obvious example of a transformational leader is the great Nelson Mandela. Mandela transformed a whole society and he did it with forgiveness and love. He showed the characteristics of a leader that everyone wanted to aspire to.

Peter Northouse wrote in his 2013 book Leadership: Theory and Practice, that a transformational leader is someone who is able to “engage with followers and create a connection that raises the level of motivation and morality in both the leader and the follower”. Mandela exemplified this by forgiving the people that imprisoned him and kept him away from his family for years. He showed people that empathy and love will conquer over fear and resentment – only by rising together can society achieve its goals.

Mandela was able to articulate his vision of whites and blacks living together equally in South Africa. In 1942, he led a peaceful revolution against the government, trying to overturn the unequal land distribution in the country. Mandela knew that the revolt, although aiming to be non-violent, would lead to his own prosecution. Yet, he led through self-sacrifice. His followers continued to be inspired during and after his time in prison. They understood that through their self-actualization that the need to be free is strong and that is would only come about through democracy.

One of the best examples of his transformational leadership skills was his ability to use the 1995 Rugby World Cup as a reconciliatory power to bring the nation together. It instilled a sense of national pride to the nation – no matter what the color of your skin was; you were still a South African.

Mandela was a charismatic man and he had the ability to inspire people who never had a chance to meet him. You can find some inspiration from the below talk by Mandela:

John D. Rockefeller / Standard Oil

The world of business has also seen its fair share of transformational leaders. Among the businesspersons that shaped the world or their industry, the American business mogul John D. Rockefeller must be close to the top. Rockefeller founded Standard oil in1870 as a humble, small oil refinery. Quickly, the company grew into a global oil giant, as it increased its size through acquisitions and Rockefeller’s vision.

The success came through Rockefeller’s focus on quality products and his staunch organization strategy. He was disciplined and he wanted these values to be highlighted in his company as well. The reason Standard Oil managed to grow so rapidly was down to the vision of Rockefeller. He wanted each operation in the organization to work towards the single objective and everyone, including himself, was accountable for ensuring the objective is achieved.

Rockefeller’s vision was clear in both his business and personal life. When he received his first paycheck at the age of sixteen, he promised to give one tenth of his money to charity once he retired. Due to his business successes, he ended up giving around $550 million.

Good leadership consists of showing average people how to do the work of superior people,” Rockefeller once said, highlighting the importance of inspiring and empowering people to the next level.

One of the issues that ended hindering Rockefeller’s leadership was his dedication. He was so committed to transforming the industry and working towards his vision that he never had a proper break. He suffered an emotional breakdown due to overworking, reminding leaders everywhere that sometimes it’s essential to just have a break.

Ross Perot / Electric Data Systems

Another example from the business world comes in the form of Ross Perot. He started out as a salesman for IBM, before launching his own company in the 1960s. Electric Data Systems (EDS) serviced computer systems for companies and organizations and it was one of the first business ventures he undertook.

Perot’s vision was based around action. He was closely involved in training his employees and helping them to understand that whatever the customer asks, their duty is to help. There were no approvals and questionnaires to be filled – if you know how to fix it, you simply do so.

At one point, the company’s motto was “We bring order to chaos”. No one was considered above one another. It was all about transformation and action.

Bass wrote in 1990 that Perot’s transformational leadership was very self-effacing. Perot himself once said, “To a lot of guys I don’t look like I could afford a car.” Yet, EDS ended up being a $2.5 billion organization, which used quasi-military management to finish the job efficiently.

Like Rockefeller, Perot’s leadership also included a strong personal element in everything he did. In 1979, he helped in the efforts to rescue hostages in Iran; two of who were his employees. He never forgot about the importance of other people and he cared about the wellbeing of his subordinates. They were as big part of his vision as he was.

His ideas and vision are clear in his statement that,

Punishing honest mistakes stifles creativity. I want people moving and shaking the earth and they’re going to make mistakes.


Transformational leadership is built around the idea of leading by example. It is about empowering people to achieve their full potential and work towards the concept of self-actualization. From Burns to Bass, the theory has been built around the idea of challenging and changing the status quo and thriving towards greatness.

The model emphasizes the importance of the leader, who must be able to create a clear vision of change and explain this vision in a manner that inspires followers the join in on the fight. The transformational leader must use his or her charisma, persuasion and empathy in order to create a structure that enthuses the followers.

While transformational leadership can be highly effective in situations of problems and lead to empowering people, it has its share of downfalls as well. Although Burns and Bass both believed transformational leadership requires a moral component, history has shown that not all change is good, even if the intentions are there. Like charismatic leadership, transformational leadership can slip into a personality cult, where reality blurs into the background as the organization only focuses on the given vision ahead of them.

Yet, the measurability of transformational leadership with MLQ and the examples from the corporate and political world show that a strong vision can help take organizations to the next level. Since the world is not stagnant, leadership should also consider maintaining its continuous flow towards change.

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