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Transformational leadership is important to establish high performing teams at work.

Critically examine this statement drawing on scholarly articles and theories discussed during
tutorials and lectures.

Statistics for the UK have shown Output per hour in the UK was 18 percentage points below the
average for the rest of the major G7 advanced economies in 2014 (ONS, 2014). Despite the UK
being one of the largest economies in the world, there is a clear need for improvements in
productivity to maintain this position. The introduction of teamwork has significantly improved
productive capacity over time by developing the concept of labour division. High performance
teams differ, and are generally rarer than regular teams. While focussing on aspects such as
production targets and improved product quality like regular teams, high performance teams also
enable individual growth. Depending on the businesss nature and subsequent working
environment, high performance could be related to tangible goals, the teams ability to work well in
the long term or their ability to reach non-monetary targets. This aspect of the definition is itself
variable in its interpretation, both within and between industries. As these environments offer
differing pressures and demands from a leader, we must consider this variable element when
evaluating a leadership methods success. Transformational leadership is an important aspect of
establishing high performing teams however on its own, it may be insufficient. A combination of
leadership approaches may be best suited to create high performing teams within the workplace.
Throughout this analytical essay the impact on teamwork of transformational, situational and
transactional leadership styles will be assessed, as well as other factors which may influence team
productivity.

Teamwork benefits not only firms, but also individuals within teams. In the case of high performing
teams, the firm benefits from greater scope for innovation and improved organisation. Individuals
grow and develop while increasing their personal motivation levels. Management theorist Meredith
Belbin (1993) studied how understanding team dynamics is an essential part of leading high
performing teams by identifying nine key roles which individuals contribute to teamwork. After
evaluating which team role each individual contributed, Belbin claimed to be able to predict team
performance based on the balance of his nine desirable characteristics. Circumstances where
particular team roles were absent from a group were deemed to have a lower performance rate;
indicating how the personality of individuals will alter the performance of teams, despite the
leadership style. This shows how leaders must not only understand expectations of the outcome of
the task as a whole, but also what individuals expect of themselves. After establishing this, leaders
can evaluate what individuals could bring to the group, thus creating a balanced team (Belbin
1993). However, research has shown that the concept of team roles does not solely determine the

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performance of a team, at least thirty-five additional concepts have been attributed to high
performing teams (Senior, 1997). Improving upon team dynamics requires the improvement of
interrelation and trust among team members, otherwise known as group cohesion. This timely
process can be enhanced via group rewards, giving groups more time together and stimulating
competition with other groups to encourage individuals to work together efficiently (Robbins,
2003).

The extent to which improvements in team cohesiveness can affect team performance depends on
the individuals level of diversity. Surface level diversity explores aspects which can be visually
observed, such as age, gender or race, these aspects are less likely to cause an issue in the long term
and on the whole have a lesser effect on group cohesion. On the other hand, deep level diversity is
amongst individuals values and abilities. Although not visible, after development these differences
reduce cohesiveness and therefore are likely to affect group performance in the long term (Harrison,
Price, and Bell 1998). Team size also impacts cohesiveness, when teams exceed the optimum size
of five to seven members, the level of functionality within teams is expected to diminish.
Communications between members becomes more complex, while members feel less individual
satisfaction and motivation, hence slowing down the completion of tasks (Wheelan 2009). These
factors combined, in the long term, will reduce team cohesion and therefore team performance.

Transactional leadership is a linear approach to managing high performing teams. By defining a

clear goal at the beginning, leaders work backwards in order to establish what inputs and processes
are required in order to meet this goal. Transactional leadership is made up of two factors:
contingent reward and management-by-exception. (Dussault and Frenette 2015). Management-by-
exception is the process by which leaders feedback negative information when individuals fail to
meet expectations, whereas the contingent reward system relies on the feedback of positive
reinforcements when individuals complete set tasks successfully. In its ideal form, the combination
of feedback types aims to motivate individuals to be more innovative in future tasks (Dussault and
Frenette 2015). Under this reward based leadership style, a bargain is struck offering financial and
non-financial benefits to individuals and associated parties to motivate them to achieve their goals
(Burns 1978). Over time, after innovation and reflection, individuals personal ability will improve,
enabling teams to increase their performance.

The prevailing leadership concept, transformational leadership, was first theorised in the 1970s by
American historian J.M Burns (1978). Furthering the concept, comparative research on

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transformational and transactional leadership, along with the impact of leadership type on
individual motivation and performance has been publicised (Bass 1985). The transformational
leader inspires, intellectually stimulates and is individually considerate to followers (Bass, 1999).
Bass theory expanded on the concept of charismatic leadership, stating how the use of
transformational leadership enables groups to improve upon and exceed targets. Research states that
due to the interpersonal skills of women, they are more likely to be posses characteristics commonly
associated with transformational leadership. Increasing communication and encouraging individuals
to actively participate in group tasks allows women to successfully lead and manage high
performing teams (Rosener 1990). However, research into the relationship between gender and
leadership style indicates the difference between male and female leaders is negligible (Eagly
1987).

The transformational leader gains a greater commitment from subordinates and induces them to
transcend personal self-interest for the betterment of the group (Bass, 1985; Yukl, 1989). As stated,
the creation of high performing teams may be established as individuals feel of more value,
allowing them to reach their potential and transcend their own self interest for the sake of the team
(Bass 1985). A clear link can be seen to Maslows hierarchy of needs which situates self
actualisation at the pinnacle, highlighting its importance (Maslow 1943). Secondly, team members
will be more aware and understanding of the overall team goal and will hence work more
productively in order to achieve them (Bass 1985). This intellectual stimulation is expected to
encourage the visualisation of goals and aid creativity allowing team members to excel at the task at
hand. Transformational leadership is seen to be highly effective when used at the higher levels of an
organisation. Dubbed the falling dominoes effect, the concept shows how transformational leaders
with a clear direction and vision influence how lower levels of the organisation operate, hence
establishing higher performing teams at multiple levels (Bass, Waldman, Avolio and Bebb, 1987).
This notion will be highly effective in firms which have a hierarchical structure. The flexibility of
transformational leadership to be used in a variety of careers and educational settings illustrates how
it can be used efficiently in order to establish high performing teams, however, the extent to which
depends on which industry the team is a part of. Performance is often closely related to innovation,
hence in industries where there is a higher scope for innovation, transformational leadership is
likely to be more effective as it gives individuals more freedom and time to complete tasks.

Situational leadership theory highlights how leaders will respond with different leadership styles
dependent on situations and the task at hand, fundamentally stating how there is not a one size fits

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all style when it comes to leadership. (Hersey and Blanchard 1988). Categorising leadership into
four behaviour types; telling, selling, participating and delegating at four readiness levels, Hersey
and Blanchard were able to identify and recommend the imperative role a leader should play in
order to produce high performing teams. The theory relies heavily upon the maturity levels of
individuals within the group. Confident, capable individuals with a high level of readiness are more
likely to require a delegating approach to leadership while those with a lower level of readiness,
for example new team members, often requiring a telling approach. However, despite appearing to
be a sensible approach to leadership, by having adaptable team leaders who are readily flexible
towards changing their management approach based on individual needs, the theory was heavily
criticised. With multiple assumptions being made about the ability for leaders to quickly modify
leadership style based on certain individuals within a team, the theory was quickly dismissed by
some academics due to lack of evidence and theoretical justification (Bass 1990; Yukl 1981)

The extent to which differing leadership styles are effective in creating high performing teams
also is dependent upon how a firms management defines high performance. If in the eyes of the
firm, high performance was directly correlated to the quality of a teams produce, then it can be
argued that transformational leadership styles may be most effective in achieving this. However, if
high performing teams were determined on their ability to quickly reach targets, for example
closing deals by a certain date, transactional leadership may be preferred as short term goals are
clearly visible. In relation to this, a combination of both transformational and transactional
leadership styles may be most effective in encouraging team performance across different
industries. Research in the 1990s has proven the correlation between transformational leadership
and project quality (Keller 1992), however, the task at hand must be considered while evaluating
this statement. Steiner identified a taxonomy of team tasks and divided them into three categories;
component, focus and interdependence. The category in which the task falls into plays a role when
evaluating which leadership approach will be most effective in producing high performing teams
(Steiner 1972). Transformational leadership is expected to be more successful in team tasks which
are longer term, autonomous tasks. It is a timely process not only for an individual within a team to
feel as though they have reached their full potential while maximising job satisfaction, but also to
gain respect for, and motivation from a leader, aspects which transformational leadership styles
heavily rely on. In the case of simpler, more repetitive short term tasks which must be completed
under strict time pressures, individuals may benefit through transactional leadership. Assembly line
workers are likely to feel more exploited (Thomas and Mchugh 1990), hence, short term rewards
such as additional pay or extra holiday time should motivate individuals to quickly complete the

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task while making them feel more valued. A potential downside of this may be the reduced quality
upon completion, especially if the task fell into Steiners Focus Optimising category where quality
is key to completing a task successfully (Steiner 1972).

To conclude, it can be understood that although transformational leadership is important at

establishing high performing teams, however, on its own, it is insufficient. Despite leaders ability
to use their charisma to intellectually stimulate individuals, encouraging motivation and creativity,
after looking deeper into the topic it has allowed the identification of other, seemingly more
important factors that determine the outcome of a teams performance. Team size, diversity and
dynamics will collectively have an effect upon the cohesiveness of teams. Without team
cohesiveness, leaders will find it significantly harder to establish desired levels of performance. The
task at hand will also contribute to analysing which leadership style would be best suited for
differing teams. In certain industries, a combination of leadership styles may be better suited
showing how there is not a one size fits all policy when it comes to leadership. Although
transformational leadership is the prevailing method in establishing high performing teams,
fundamentally, there are a considerable number of other contributing factors that collectively
outweigh its importance. Due to this evaluation, the need for a unified theory which takes into
account all factors is required in order to successfully establish high performance teams.

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