Sustainable Leadership in the Context of Organizational Change

 Introduction

The term "organisational change" refers to the deliberate process of altering an organization's structure, processes, systems, products, or any other component. Typically, this shift is caused to assist the organisation in achieving its objectives more efficiently and effectively (Lines et al., 2011). Davies (2007) argued that the leadership position has remained critical in bringing about organisational transformation. However, the definition of leadership has been expanded to include sustainable leadership. Sustainable leadership is fundamentally based on moral principles that view success as a characteristic of all, including the organisation and society.

As a result, this article will examine two distinct sustainable leadership approaches to organisational development. The role of various leadership styles will be critically examined using a variety of theoretical frameworks. We will discuss how these approaches assist organisations in initiating and sustaining change through the use of a few examples.

Two Different Approaches to Leadership for Sustainable Change

The transformational and transactional styles of leadership have remained the topic of intense discussion in social sciences for an extended length of time. Both methods, however, are being used by executives as they strive to build change initiatives inside their organisations. The contrast between these leadership styles is the dimension by which the entire transformation effort is defined. As a result, leadership styles are regarded as a significant predictor of the kind of organisational changes (Bennett, 2009).

Bennett (2009) asserts that there are more types and styles of leadership, such as goal-oriented leadership, task-oriented leadership, authoritative leadership, and participatory leadership, that have been disputed in relation to transformational and transactional leadership styles. Thus, leadership encompasses a variety of aspects and ways via which leaders pursue the organization's change-oriented process.

The transactional and transformational leadership styles, on the other hand, are two broad types of leadership that incorporate all other kinds. The term "transactional leadership" is frequently used interchangeably with "instrumental leadership." There are several advantages to this style of leadership. Nonetheless, it is incapable of functioning at times of rapid change. Transactional leadership cannot place a premium on the expressive components of the organisation, which include creativity, cultural change, and technical development. Thus, as manufacturing becomes unstandardized, the transactional change institution becomes incompatible with achieving organisational change objectives.

The most critical component in a transactional leadership style is the leader's vision and mission, which assists him in achieving the transformation goals and objectives. On the other side, transformative leadership is viewed as having a more expressive quality. Ismail et al. (2011) developed a transformative leadership style that can be easily distinguished from transactional leadership. Often, commercial organisations combine transformational and transactional leadership approaches. However, in order to fully comprehend them, it is necessary to examine them from a diametrically opposed standpoint.

Purvanova and Bono (2009) concluded that transformative leadership is more participatory and charismatic in nature. Its values employee engagement and cooperation. However, a transactional leadership style is predicated on the flow of information between the leader and his or her subordinates (followers). This distinction between the two leadership styles is illustrated from a political perspective. The leaders esteem their followers or reward and incentivize them when they follow the leader's direction and commands.

Thus, the article will extensively analyse the contradictory position of both theories from a behavioural standpoint. The behavioural approach was chosen since both theories contain behavioural variations in leadership styles. Nonetheless, these styles will be examined in light of organisational transformation.

Transactional leadership has always been seen through the lens of a cost-benefit analysis. It adheres to stringent standards and processes while evaluating the outcome's quality. The followers profit only when they appear to serve the leader's interests. Thus, a pure exchange mechanism between leaders and followers exists, defined by the leader's behavioural goals toward change. Instrumental leadership is frequently associated with the notion of providing direction and order to followers, which should be accomplished in the manner determined by the leaders. Within the organisation, followers are not permitted to use judgement or power (Boseman, 2008).

Transactional leaders frequently sacrifice the importance of motivation, team orientation, and employee happiness in their work and goal setting. However, these three components are the primary drivers of organisational transformation. Compromise of these three variables might result in a breakdown of the organization's transformation effort. However, the critique stated that the transactional leadership method established the framework for social interaction between leaders and followers, in which both sides engaged in pure commerce. The leaders establish the goals and objectives and encourage their followers to attain them. In this case, the organization's norms and values are maintained, and followers demonstrate their commitment to the leadership's aims and objectives (Boseman, 2008).

The leader possesses the authority, which he imparts to his followers, to accomplish tasks. In exchange, followers receive valuable outcomes in the form of incentives and pay. Thus, this demonstrates the transactional leadership approach's incorporation of social exchange processes. However, the organization's governance, structure, and environment all play a part in the transactional leadership style. Organizations undergoing transformation initiatives employ transactional leadership because leaders are accountable for making critical decisions about the organization's structure and culture, which cannot be delegated to followers.

Generally, leaders place a greater emphasis on the organization's structures and goals in a transactional leadership style, which is extremely beneficial for establishing change inside the organisation. Sir Alan Sugar exemplifies the transactional corporate leader. He was well-known for making incremental improvements to his firm over time. He did not advocate for dramatic change; rather, he advocated for continual change practises through the use of potential dimensions for change. He catapulted Amstrad to the pinnacle of prosperity by adhering to the transactional leadership style. He is widely recognised as one of the world's most successful entrepreneurs today (Bennett, 2009).

Transactional leaders frequently employ contingent compensation and management-by-exception (MBE) approaches to improve performance and achieve follower cooperation during the transition process. The leaders give prizes to their followers for attaining results and objectives that contribute to their performance improvement. This illustrates the notion of contingent incentives in the context of transactional leadership (Bennett, 2009).

Management-by-exception (MBE) often has a lower influence on employees than dependent incentives.

The MBE enables management to continually monitor and assess employees' performance and subsequently take remedial action. This type of leadership is less prevalent in transactional leadership. The most eschewed style of leadership is Laissez-Faire Leadership (LF), which transactional leaders reject. LF is the process of distributing authority to followers in order to accomplish objectives and goals. They chart their own course and make critical judgments as necessary. However, transactional leadership is diametrically opposed to this type of leadership (Boseman, 2008).

According to Burns (2003), the transformative style of leadership emphasises charm and coordination as primary components. It is predicated on the idea of transformative change and extreme environmental variability. It may function during challenging periods when the company's operations appear to be lacking in balance and stability. In these circumstances, transformational leadership may be able to assist the organisation in overcoming the crisis. The transformative leader motivates his or her people by promoting involvement and persuading them via charm rather than brute force. Because of the leader's appealing personality, followers gravitate toward him.

According to Ismail et al. (2011), transformational leadership is characterised by significant changes and transformations in the company's aims and objectives. The primary distinction between transactional and transformational leadership styles is found in their approach to coordination, control, and self-interest. In comparison to transactional leaders, followers under the influence of transformational leaders are more encouraged to engage in decision-making, demonstrate their self-interest, and become aware of the value results. Employees are driven by their self-esteem and self-interest, not by monetary considerations such as money and salary.

Transformational leaders place a premium on their followers' regard. The transformational leader embodies a common vision and perspective on the organization's values and standards and takes a future-focused and team-oriented approach to achieving organisational goals. With these common ideas and values, transformational leaders are prone to alter the entire organisation in order to prepare it for global competition (Gumusluoglu&Ilsev, 2009).

Bill Gates is one of the most well-known instances of transformative leadership. Throughout his career, Bill Gates has sought a transformative leadership approach. He has always emphasised the importance of subordinates and followers participating in decision-making. He cherishes his followers' thoughts and ideas, which is why Microsoft has been able to scale the heights of success in such a worldwide and competitive industry. He visualises the future in his head and leads a whole team toward achieving that goal. The improvements that have occurred at Microsoft are a real reflection of the collaborative efforts of the staff and Bill Gates, who have propelled the company to the pinnacle of success (Gumusluoglu&Ilsev, 2009).

Thus, transformation is a dynamic process that requires leaders to employ both leadership styles. However, transformational leadership is frequently seen as more suitable since it places a premium on employee results and engagement.

Conclusion

To summarise the above explanation and examples, transactional leadership is predicated on the notion of social trade between leaders and followers. They participate actively in this exchange process as leaders who establish the objectives and followers who follow the goals. This strategy is typically taken when an organisation experiences significant strategic and organisational changes. At that point, they demand the appropriate norms and procedures and compel employees to follow their instructions in order to accomplish the desired results. They frequently have a time constraint, which means that adopting laissez-faire leadership would not be the ideal fit for transactional leaders. In summary, employees are expected to cooperate with the organization's transformation programme regardless of their own preferences, and they are expected to obey the leaders' orders.

However, transformational leadership has been identified as the most effective strategy for implementing transformative transformations. It necessitates the involvement and coordination of followers in the process of change. Without their involvement and coordination, the change will fail to succeed in the organisation. Because workers are the ones who implement these adjustments and alterations, their involvement is critical for leaders. Additionally, transformational leadership views this idea as the optimal strategy for attaining organisational objectives. However, criticism shows that a blend of transactional and transformational leadership styles may be most effective during the transition process.

References

 

Bennett, T. (2009). A study of the management leadership style preferred by it subordinates. Journal of Organizational Culture, Communication, and Con-flict, 13(2), 1-25.

 

Boseman, G. (2008). Effective leadership in a changing world. Journal of Financial Service Professionals, Open Journal of Leadership, Vol.2 No.4, PP. 36-38.

 

Burns, J. M. (2003). Transforming leadership: the new pursuit of happiness. [Online] Available at: https://www.overdrive.com/search?q=EBEF78A3-2EB0-4F3C-ABAF-D3A4E55BCADC. [Accessed: 24^th June, 2021]

 

Davies, B. (2007) ‘Developing sustainable leadership’, Management in Education, 21(3), pp. 4–9. doi: 10.1177/0892020607079984.

Ismail, A., Mohamed, H.A.B., Sulaiman, A.H., Mohamad M.H. and Yusuf, M.H (2011). "An Empirical Study of the Relationship between Transformational Leadership, Empowerment and Organizational Commitment," Business and Economics Research Journal, Uludag University, Faculty of Economics and Administrative Sciences, vol. 2(1), pages 1-89, January.

Lines, R., Sáenz, J. and Aramburu, N. (2011) Organizational Learning as a By-product of Justifications for Change. Journal of Change Management 11 (2), 163-184. DOI: 10.1080/14697017.2010.548340

Purvanova, R. and Bono, J. (2009). Transformational leadership in context: Face-to-face and virtual teams. The Leadership Quarterly. 20. 343-357. Doi: 10.1016/j.leaqua.2009.03.004.

 

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