Abstract
Leadership is an integral component for creating change. The very act of change requires leadership to be enacted. In past few decades, researchers and practitioners have struggled to provide definitions for leadership. Theorists have attempted to map out the varying leadership styles, in order to demonstrate their relationship to the follower and the effect particular leadership styles may have on the organization.
Over the years, the study of leadership has evolved, resulting in many 'types' of leadership, which can be explained through a series of phases. The study of leadership has switched focus over the years from a behavioural and situational perspective to that of a transformational approach. According to Burns (1978), the two main leadership forms comprise of transactional and transformational leadership. While transactional leadership involves a process of exchange between leaders and followers, transformational leadership in all its potency operates on a higher level.
This complex approach positions the leader as an individual who can elevate followers into achieving a desired outcome or targeted end by converting followers into leaders.
In this sense then transformational leadership is not entirely a new concept. However, its significance is heightened as organizations are engaged in keeping up to pace with the robust, tumultuous and radical changes that are presented from changes in the business environment. Hence, there is a need for every individual to become a leader and take ownership in order to lead the organization towards its targets.
While it is acknowledged that few are born with transformational leadership traits, several studies have found that transformational leadership can be trained and taught to leaders (Bass, 1990; Barling, et al. 1996). With this in mind, this project report delves into the significance of transformational leadership by examining the effects of trained transformational leaders on value change in a Malaysian Bank.
Rashid Hussain Berhad (RHB) Bank is a public listed financial services company with international investments in stockbroking industry, insurance, property ownership and management as well as provision of security and nominee services.
Traditionally towards the early 1990s RHB Bank was more focused on corporate and commercial business and the consumer-banking segment was small. Banking industry was traditional in nature with legacy systems and products. There was very poor branding and performance of the bank by industry standards was mediocre. Due to the change of shareholding in 1990 and awareness of a need to shift from traditional methods of service to a more customer centric approach, a strategic five year business plan was developed in 1996 resulting from a study carried out by consultants engaged by the bank to position itself in the forefront of the local banking industry. This was known as The Bankwide Transformation Project. One of the components of the transformation program comprised of training branch managers, to become transformational leaders in order to create value change in the bank. This study, using interviews as a chosen methodology, gathers responses from the branch managers whom underwent transformational training and branch managers whom were not given transformational leadership training. In order to evaluate the successfulness of the training program subordinates (assistant branch managers) to the branch managers, were interviewed. Since the key outcome of transformational leadership is to gain followership (that is the follower emulating the leader) interviews with the assistant branch managers provided information as to whether having leaders whom had undergone transformational leadership had more impact on their value change than those whom had leaders whom had not gone for transformational leadership training.
Results indicated that subordinates who had leaders who underwent transformational leadership training reported more value change than those who had leaders who had not undergone transformational leadership training. Consistent with the literature, subordinates with transformational leaders also conveyed more commitment to the organization and were more bound to the organization mission, vision and goals.
However, despite the success rate of transformational leaders in enhancing and leading value change, there are a few notable gaps that exits. A few subordinates reported that while leaders have benefited from the training intervention by changing their behaviours to fit that of a transformational leader, on occasions there have been lapses where the leader falls back on old habits and practices. Consistency was also a noted gap as subordinates reported inconsistency of behaviours for some leaders.
This presents a challenge for current research in the transformational leadership arena.
With issue such as consistency and lapses, future research can address these issues by examining continuity of transformational leadership post training intervention in successfully creating and most importantly maintaining value change.