Transformational Leadership In Business Strategy
Transformational leadership is a contemporary approach which affects and influences followers and subordinate’s beliefs and values to achieve organizational success and growth. It mainly focuses upon the human resource and how an effective leader can change his subordinates’ beliefs towards the organization and how to achieve success through values like integrity, justice and equality. It is basically the art of transforming or changing the organization into a learning organization where all employees work with a sense of duty and responsibility towards the achievement of organization success.
The effective transformational leaders share the following characteristics with their employees such as courage, determination, lifelong learning, vision, and dealing with uncertainty and complexity of today’s global environment (Bass, 1998). This leadership approach emphasizes upon self management or learning where continuous learning of new knowledge and skills take place to help a leader become more competent and effective in managing people and the business in today’s global competitiveness.
Leaders must be self- learners to deal with dramatic market changes that can affect the business and create hinderers in the achievement of organizational objectives. Therefore, effective transformational leader must be capable of developing his skills and knowledge on continuous basis for becoming up to date with the new changing market trends and practices and integrating new business strategies and practices in the organization.
The transformational leaders are highly successful in today’s global market where organizations face extreme dramatic global changes (Borrington & Stimpson, 2004). In today’s dynamic and global environment, transformational leadership plays a major role for organizations to increase their organizational effectiveness and performance by adopting new ways of working and redesign organizational structure and organizational culture to promote innovation and sense of responsibility in the human resource. The Role of Transformational Leaders
Transformational leaders perform many important functions in improving the organizational performance and effectiveness through a series of tasks. Firstly, awareness is made in the organization regarding the organizational issues and their consequences. This helps employees to understand the current organizational situation and identify the major critical areas of problem. Then, a vision is developed for what the organization should be in future, build commitment towards achieving this vision and help in making positive organizational changes that support the organization’s vision.
Therefore, this shows that transformational leaders emphasize upon strategic planning and management for achieving long term success in today’s global and competitive business environment (Alimo-Metcalfe & Alban-Metcalfe, 2001). Importance in today’s Global environment In today’s global and highly competitive business environment, organizations need to focus upon long term strategic planning so that it can help in building a highly motivated and efficient human resource that helps in achieving organizational success in the long run.
To survive competitive in the dynamic business environment, organizations need to change their strategies and work processes so that they can generate maximum results and effectiveness. This requires organizational change to take place with the help of transformational leaders. Transformational leaders are ones who play the role of transforming and changing the organizational culture and structure where the focus is upon building a learning organization which is based on innovation, creativity and commitment of all employees (Gasper, 1992).
Organizational Change and Role of Transformational Leaders It is any alteration occurring in people, structure or technology. Every organization faces change in today’s world as it has become one global place uniting all the countries together; hence new changes keep taking place. This change leads to new products, improvements, better organizational structures, technology and employees. Also, the rapid changes in all the aspects of human life have created a different scenario for all businesses.
Now, it is not possible to survive in the market with identifying the latest market trends, technology, customer demands, internal company problems and government policies etc. All these mechanisms and forces has impacted the organization’s activities significantly and transformational leaders can play a major role in transforming the organization for better performance in today’s global and dynamic business environment (Ball , McCulloch, Frantz & Minor, 2006). The modern strategic management approach has created a new dimension for organizations to become highly rationale and adaptable to changes.
Strategic management can be defined as the art and science of formulating, implanting and evaluating the cross-functional decisions through the help pf transformational leaders that lead to the achievement of organizational success (David, 2003). Transformational leadership plays a major role in shaping the organizational behavior of an organization and implementing the organizational changes effectively. Human resource is a key towards a business’s success and thus managing people through effective leadership is very necessary.
The role of an effective leader can help to minimize the failures for the organization in today’s dynamic and global market. The leadership skills that will be appropriate in this case to bring a positive change are mainly the vision for motivation human resource, sharing of information through two-way communication, innovative ideas, interpersonal skills and optimistic attitude towards the achievement of goals. These are the basic criteria for bringing a positive change in the organization.
Primark must focus upon building leadership qualities in the managers so that organizational changes can be achieved effectively (Luthans, 2003). Primark’s Leadership Approach and Business Strategy Primark is a clothing company/retailer in UK that has located its stores in various countries such as UK, Ireland and Spain. It has 125 stores in the UK, 34 stores in Ireland and 8stores in Spain. Primark sells its clothes at reasonable prices and its success is mainly fuelled by sourcing supplies, making simple designs and high quality to cater to the young and fashion-conscious people who are under the age thirty-five.
The dynamic competitive global environment has created a new dimension for Primark where they have to revise their business strategies continuously to remain ahead in the global markets. The way business strategy focuses upon the workforce and directs them towards the accomplishment of organizational goals needs to integrate the new market trends that include technological advancements, innovation, low costs and superior quality of products and services to customers.
All these capabilities of an organization are integrated into its business strategy which the transformational leaders use to motivate and guide their human resource effectively (Hall & Jones, 2000). Business strategy in a global business environment is the major focus of Primark as business faces critical challenges in the international markets. For this, developing a business strategy through logical reasoning and systematic process of strategic management is very necessary.
Once, a proper strategy is developed then it should be integrated into the employees’ beliefs and values so that they are committed towards achieving organizational success (David, 2003). Primark’s business strategy outlines the importance of achieving sustainable competitive advantage so that in today’s global market, it can survive successfully. Therefore, competitive advantage can be achieved by having a highly motivated and efficient workforce that gives maximum performance and productivity while saving costs.
This competitive advantage of human resource cannot be imitated by other organizations and tends to be the success factor for an organization. Achieving success has become highly challenging due to globalization and that is why Primark gives major emphasis to the business strategies and strategic management to survive successfully in the competitive environment (Hsu &Tsuen, 2000) Primark’s has adopted transformational leadership approach where it aims to transform the organization into a highly successful organization with the help of motivated and committed human resource.
This leadership approach aims to create a positive attitude in employees, which affects their performance and behavior simultaneously. This way the leader can portray himself as the role model and show his enthusiasm and confidence in company’s future and growth potential which will be transferred to the employees’ minds as well. The transformational leadership approach follows formal strategic management process where mission statement, vision and values are outlined and the external environment is analyzed and detailed planning is done for every business operation.
But, in order to achieve the sustainable competitive advantage, Primark realizes that innovative design and structure of the organization as well as opportunism are important factors also when determining the overall business strategy. These factors are more of an art than science because it is usually inborn talent of leaders and managers, which results in success for organizations. But it does not result in success always as there lie uncertainty in all areas of the business.
Thus, adopting transformational leadership approach requires leaders to identify all other aspects as well such as uncertainty in today’s global environment and how to effectively deal with all the issues while inspiring the human resource towards organization’s long term strategic success. The transformational leadership approach adopted by Primark is where a clear picture of the future is developed in the minds of employees to achieve goals successfully. Primark is a vision-oriented organization that encourages employees through an effective leader to work with determination to achieve organizational objectives in the future (Schein, 2004).
To achieve success in today’s global environment, business strategy of Primark is adaptable to change that means it has minimum resistance to change in the organization so that it accepts new processes and technology to ensure maximum performance and success. Therefore, minimizing resistance to change can be greatly and efficiently achieved through transformational leaders who influence and persuade the employees towards positive and lasting change which helps in achieving both their individual objective as well as organizational objectives.
Moreover, the external environment has become highly dynamic due to globalization and information technology; hence it requires continuous redesigning of business strategy and plans to ensure maximum performance and successful results (Sana & Shah, 2008). Primark’s modern transformational leadership approach is more rational because it encourages employees to develop an innovative and learning organization design where changes are considered positive for the achievement of success.
Innovation is considered a vital key to achieve success today because customers’ expectations and demands have changed and to meet their demands effectively, organizations must focus upon innovation to attract customers. Also, the flexible and networked organizational design provides effective communication in the organization where all the stakeholders mainly the employees, customers and the governments are satisfied. Innovation is an important dynamic in the field of business today but focusing upon one strategy to achieve success is not enough.
Today, technological advancement has created an interactive and learning organization design where the main focus is upon developing quicker business methods to achieve higher productivity and performance levels (Hirst &Thompson, 2006). An organization can only be innovative when it has people who can generate innovate ideas and hence possess innovative and creative minds. To achieve the positive results of innovation, the effective integration of human minds and resources is very important. Transformational leadership play an important role in increasing the innovation process throughout Primark.
It involves allowing innovative and creative minded employees to experiment their ideas in required directions so that positive results can be obtained. It is not necessary that it will be successful but constant and continuous efforts leads to new inventions and ideas that make businesses successful. Hence, the most important characteristics of the transformational leadership is providing its people with sufficient information and encouraging them to be innovative and creative. This is the major key to facilitate innovation in the organization (Borrington & Stimpson, 2004).
Primark’s organizational design and culture is based on the principles of continuous leaning and changes to meet the fast changing technological advancements and global market conditions. This vision towards flexibility creates an innovative environment in the organization where customers are the prime focus, which should be satisfied with all possible means that is superior quality and services as well as innovative products through innovative management (Schabracq, 2000). Moreover, the leaders in the organization give common and shared goals and purposes towards company’s overall aims.
The interaction and collaboration of different people in the workforce provides an effective base for innovation to proceed. The organizational design of Primark encourages managers to possess effective transformational leadership qualities to manage organization’s human resource as well as resources and provide better guidance and direction to innovators in the organization to achieve positive outcomes (Natalie, 2007). Recommendations To survive successfully in today’s global and dynamic business environment, organizations need to adopt different leadership approaches for achieving organizational effectiveness.
It has become highly challenging to manage human resource effectively and direct them towards the achievement of organizational long term objectives and success. Transformational leadership is a new modern approach for transforming and changing the organization’s strategies and structure for achieving maximum organizational effectiveness. Transformational leaders can become more effective through effective communication skills as communication is the root of achieving positive response from human resource towards organizational change for achieving long term objectives.
Also, through employee empowerment, organization can successfully achieve organizational effectiveness in terms of high performance and commitment of employees towards work. Communication: Communication is one of the most important dynamics in the field of strategic management and organizational behavior, because effective communication in organizations creates better understanding of the company’s vision and goals and leads to the achievement of these goals effectively.
Organizations, which develop an interactive two-way communication channel, where employees and leaders can interact with each other, tend to achieve the common goals of the organization. At all organizational levels, the human resource and managers should be fully informed about their roles and the goals they have to achieve. This should be one of the major focuses of business strategy as communication is the most important key towards maintaining and managing the human resource to perform effectively (Borrington & Stimpson, 2004).
Effective communication can lead to more accurate and detailed analysis of the problems and their solutions which will ultimately lead to effective decision making by senior strategy makers. Therefore, this cannot be regarded as pure science because communicating effectively is highly challenging task and it is an art that some people possess and others are learning through experience and scientific approaches (McMillan, 2002). When companies like Primark go global, they face major problems regarding the understanding of different cultures and how to manage the human resource effectively for achieving organizational effectiveness.
Understanding the culture plays an important role to succeed in a new foreign market and hence, leaders must focus upon the art of effective communication across cultures to maintain same environment in its branches. The strategic management approaches explain the importance of culture and how to be successful in different cultures, but today many organizations fail to do so successfully, because understanding of culture is an art not a science (Sana & Shah, 2008).
The two communication styles which are interpersonal communication and communication across cultures primarily lead to effective leadership for achieving organizational effectiveness. Organizations must put great emphasis upon the interpersonal communication, which is the flow of information from one person to another. This leads to better mutual understanding between the human resource and leader where the information is clearly understood by all the employees and they respond effectively towards it (Gannon, 2009). Employee Empowerment:
Employee empowerment is an HR strategy today, which aims to achieve maximum effectiveness and efficiency of the human resource. Therefore, affective leader needs to build an organizational culture where empowerment of employees is implemented throughout the organization. This will lead to employees accepting responsibility of job willingly and work practices will improve leading to high performance. An effective leader must be able to develop ‘empowerment of employees’ so that it encourages employees to participate actively in the organization’s activities to achieve success.
This way the future contingencies and challenging environment will be dealt more accurately and efficiently by the collaborated efforts of the whole workforce trough the direction and vision of an effective leader. Employee empowerment allows employees to make effective decisions and try out new ideas and practices to achieve more successful ways of increasing productivity and performance (Yehuda, 1996). Conclusion Today, organizations face critical challenges in achieving their organizational objectives because the global business environment is becoming highly dynamic day by day.
This requires effective strategic planning and leadership approach where both simultaneously work to motivate employees towards achieving organizational success. Transformational leaders greatly help in identifying the organizations problems ad hoe they can be achieved by developing a vision to achieve long term success. This vision is integrated into the employees’ beliefs and they are encouraged to work with commitment and responsibility with minimum resistance to change when organizational changes are taking place.
Primark is an international organization which has adopted transformational leadership approach in managing its human resource achieving organizational success through heir determination and commitment. Organization effectiveness can be achieved through developing a learning organization where innovation is they key to achieve organization’s vision. Bibliography Alimo-Metcalfe, B. & Alban-Metcalfe, R. J. , 2001, “The development of a new transformational leadership questionnaire”, Journal of Occupational and Organizational Psychology, Vol. 74 No. 1, pp. 1-27. Ball D. A, McCulloch.
H, Frantz . L & Minor. M. S. 2006, International Business (10th Ed), “Strategic Management”, McGraw Hill pp 150-257 Bass, B. M. ,1998, “Transformational Leadership: Industrial, Military and Educational Impact”, Lawrence Erlbaum, Mahwah, NJ Gasper, J. M. ,1992, “Transformational Leadership: An Integrative Review of the Literature”, Western Michigan University, Kalamazoo, MI Borrington. K & Stimpson. P. 2004, Business Studies (2nd ed. ), “Strategic Management”, pp. 65-89 Barnet, R & Cavanagh, J, 2006,”Global dreams: Imperial corporations and the new world order, Journal of Economics”, pp.
10-16 David. R. F, 2003, “Strategic Management – the need for business strategy”. Pren Hall, pp 7-13 F. Luthans. 2003, Organizational Behavior. ”Organizational Design and Culture”. pp. 581-696 Ghai, D. and Hewitt, C. 2006, “Globalization and social integration: Patterns and processes”. United Nations Research Institute for Social Development (UNRISD). Occasional Paper, World Summit for Social Development. Gannon. M. J. 2009, “Understanding Global Cultures: Metaphorical Journeys Through 28 Nations, Clusters of Nations, and Continents” ( 10th ed. ) Hall. D and Jones. R.
,2000, Business Studies, “Leadership”, 2nd ed. pp. 125-175 Hsu &Tsuen. H. ,2000, “Gaining a Competitive Advantage Through the Refinement of Measuring Consumer Involvement”. pp1-3 Kevin,K. & Kotler,P. , 2008, “Leadership”. (13th Ed), Prentice Hall. pp. 25-43 Malcolm. M & Leslie. C, 2006, “Corporate Marketing and Service brands: Moving beyond the fast moving consumer goods model”. Journal of Business and Economics”. pp. 1-8 Natalie. M, 2007,” Brand Personality Enhancement An Experimental Study of Alternative Strategies, Journal of Management, Available from www. edamba.
eu/userfiles/Natalia%20Maehle. doc pp 2-5 Sinioria. P. 2008, “Culture”, Journal of International Business. Available from http://www. oppapers. com/essays/Culture/154748. pp. 3-7 Sana. S. R. & Shah. A. 2008, “The Challenges of Globalization and the Role of Human Resources”. Pp. 1-3 Schabracq, M. J. 2000, “Changing Organizational Culture: The Change Agent’s Guidebook”. Wiley. pp. 1-5 Schein, E. H. 2000, “Organizational Culture and Leadership”. The Jossey-Bass Business ; Management Series Yehuda. B. 1996, “Evaluating Quality and Reputation of Human resource Management”, Pp. 355-479