The Adoption of Transformational Leadership in the Management of Projects - Case Study Example

Organisational change and the adoption of transformational leadership in the management of projects Abstract The paper focuses on the topic of organisational change and the adoption of transformational leadership in the management of projects. It focuses on the implications of using transforming leaders to bring about organisational changes and how transformational leaders help in the progress of the organisation. The paper also highlights the relation between transformational leaders and manipulative behaviour and how the organisations should be careful about such leaders while affecting changes. As per Popper and Zakkai (1994, p. 3) transformation in the leadership needs to be proactive and that leaders must be able to see the present time and achieve future goals as well. Implementing such a process requires careful planning by recognising the changes, creating new visions and targeting towards the change. This paper discusses some of the processes that are integral towards creating changes within an organisation through a transformational leader. The paper especially leverages this concept in the case study of Chrysler Corporation, under the charismatic leadership of Lee Iacocca. The paper also stresses on the inspirational ideas and innovations propagated by Banner and Gagne (1995). It was found that transformational leaders may often lean on their charisma to bring some radical changes within the organisation as found in the case of Chrysler, wherein the personal charm of Iacocca lead to the changes within the organisation. However, charm only cannot sustain the momentum for long, which could be seen in the case of Chrysler. With Iacocca’s exist, the company again found itself in trouble. Thus, it is necessary to base organisational changes not just on transformational leaders but on the parameter of providing a stable business environment. Table of Contents Organisational change and the adoption of transformational leadership in the management of projects 1 Abstract 2 Table of Contents 3 Introduction 4 Literature Review 5 Case study 8 Recommendations 10 Reference 11 Introduction Although leadership is very critical for successfully implementing change in a given environment, effort taken by the leadership would be a main determinant of seeing if the change can be implemented successfully. Popper and Zakkai (1994, p. 3) opine that the transformation in the leadership has to be proactive and that leaders must be able to see the present time and achieve future goals as well. Engaging in the process includes sequence of phases implemented: recognise the change, new vision created, and targeting the change. Charbonneaue (2004, p. 566) opined that transformational leaders are used to influencing the results with the commitment from the followers to achieve the target. Bass (1985, p. 12) was also able to identify the charisma or influence the ideation which was followed by the trust and emotionally identified with the leaders, which has become one of the important factors for transformational leaders. On the other hand, charismatic leadership can leave the space which could persuade as well as manipulate and also ask ethical questions that concerns the nature. Manipulation may occur from divergent people and it is the responsibility of the organisation to ensure that the moral tensions are diffused, especially taking into account the deeds and words of these people. The difference between deeds and words has profound costs because it renders the managers who are untrustworthy as well as undermines the credibility and the ability for using words for influencing actions towards their subordinates (Simons 1999, p. 89). Thus, behavioral integrity could emerge as a problematic element in the present environment where changes have to be implemented (Simons 1999, p. 91). In the present times, leadership has been very difficult, although the unique stressor that has been faced by the organizations globally demand to have focus on the things that constitutes to become a good leader (Avolio and Gardne 2005, p. 321). The turbulence in the environment has stimulated the search for new theories or thesis of leadership, these searches have resulted in the growing body of research also, some of the literature that has been evolved. In one such research results, the authenticity concept has become one of the central focuses of the responsible behavior for the leaders in the era which can be considered post Enron (Novicevic et al. 2006, p. 67). Authenticity can be defined as owing personal experience through the thoughts, values, emotions as well as beliefs. It means also acting per one’s true self which can be expressing what has to be believed as well as behaving in accordance. One who is deeply aware of how one can think or behave as well as perceived being of their own and other values, strengths, knowledge is being aware of the context by which they can operate. One who is confident, optimistic, hopeful, high moral character and resilient can be a good manager (Avolio and Gardner 2005, p. 317). Literature Review The focus of leadership is to make important changes within the organisation that not only challenges the old system but also create newer systems for helping the organisation progress (Kotter 1995, p. 60). With more turbulent environment, attention has to be given to leadership in the changes that occurs in the environment (Schruijer and Vansina 1999, p. 3). These leadership styles become closely linked to the changes proposed by the management. Tushman and Nadler (1990, p. 77) state that leadership can be a critical factor for initiating and implementing large-system organisation change. In the study of merger, Tyler and Cremer (2005, p. 530) has proposed that the leadership is one of the central processes that can change and in the particular scenario have the ability for producing some of the constructive or able to adopt the change. Effective management and implementation which is significant to an organization has to be an elusive process. These sheer complexities of the organisational system are able to lead the unpredictable as well as detrimental outcomes. The way of managing the challenges and complexities which can be resistance to changes and also the task for the top executive for implementing these changes could be difficult as well. Thus, leadership which is at the top level, can be probably the critical portion of the changes that being proposed (Clement 1994, p. 33). The changes implemented do not stop with just adopting and communicating (Armenakis et al. 1999, p. 98), on the other hand, they need to be institutionalised as per Kotter (1995, p. 61) the proposed changes need to be sustainable in the long term by seeping into the very core of the corporate body. Outlining this, Armenakis et al. (1999, p. 122) proposes a three-stage change process which models which proceeds some of the linearly for readiness for adopting these institutionalisation. Readiness on the other hand is defined as a cognitive state, and in the context of an organisation, such a state occurs when the company displays a positive attitude, intention and belief towards making necessary changes within the organisation (Armenakis et al. 1999, p. 121). While the appropriate state of cognition can be attained by developing the relevant attitude, intentions and belief towards change, organisational members are beginning to adopt the changes. They are able to behave in such a manner that is consistent with regards to initiative that is congruent to changes and then can be completely integrated in the fabric of the organisation, which is then institutionalised in the firm (Holt et al. 2003, p. 263). Organisations that work under unsettled conditions are often dependent on their staff to observe the general environment within the organisation and provide the leaders with the insights. These insights in turn help the leadership to formulate the policies and decisions to make necessary changes within the organisation as per the prevailing conditions (Banner & Gagné 1995, p. 45). One of the ways to strengthen the organisational culture and to boost the commitment of the people towards the organisation is by logical measurement (Banner & Gagne 1995, p. 58). In 1995, Banner & Gagne said that certain points can be analysed while studying the any organisational structure. These include methods to put together an organisation, wherein aspects such as responsibilities, the power of decision making and the magnitude of the norms, regulation and the policies of the organisation are given foremost importance. A cultural model gets encouraged when a culture is at its socialization process. Once it is done the model becomes "the ways things are" and that too in such a form that they cannot be doubted and hence always believed and trusted (Banner and Gagne 1995, p. 369). Since the period of late 19th and the early 20th century the term organisation is defined as “a goal-directed collective” as per Banner and Gagne (1995, p. 3). It a set of goals should be identified in every organisation that works together to make it look like a single unit. Every organisation design strategies to attain its objectives. These strategies can also include training, developing leadership skills and planning. The extent to which an organisation is can stand apart because of its qualities, its functionaries and the job done by the people of the organisation is traditionally defined as complexity. At the same level of the organisation’s hierarchy the grade to which the units are differentiated is where the term horizontal differentiation is applied, according to Banner and Gagne (1995, p. 12). The higher the level of horizontal differentiation is, the higher the difference is generated in the level of goals, skills and other such management jobs, which leads to conflict in communication and corporation where sometimes we can also witness a state of decline to the extent of forming ‘silos’. That do not allow the reunion of the inter unit collaboration. Case study The debate about the need to focus on organisational changes and structures generated immense interest during the early era of 1980s in the US, when the country’s economy was going through immense changes and required the American companies to remain competitive in the global market (Tichy and Ulrich 2008, p. 59). To meet this situation tactfully some new kind of leaders were appointed to study this kind of change who could help the organisations to lead to a desired direction by Tichy and Ulrich (2008, p. 61), to get supported and buy-in from the stakeholders and guide them through this changing phase. Such kinds of leaders are known to create something new from something old and hence they are known as transformational. The difference between a transactional manager and a transformational leader is that the manager would make a slight adjustments to the structure of the organisation and maybe some to the human resources but a transformational leader would make fundamental changes in the policies that can help the organisation grow even in such situations by addressing changes in the political and the cultural changes. Lee Iacocca, former CEO of the Chrysler Corporation was presented by the Ulrich and Tichy (2008, p. 59) to help develop their argument in the form of a case study of the transformational leaders. Lee Iacocca started by helping an organisation to transform into profitability from the state of bankruptcy in the late 1970s by his transformational leadership. Iacocca could do so as he restored to internal politics and systems, changed management structure, trimmed tens of thousands of employees, won concessions from the UAW, and translated the “loser” stigma of a government bail-out into a positive cultural shift. Based on a few assumptions Tichy and Ulrich (2008, p. 63) defined the organisational fundamentals of change. Some of the assumptions are discussed in detail below. The indicator of change needed is an elicit event and that event was threatening bankruptcy. The second assumption is that mixed feelings are generated because of the changes like both strong positive feelings and as well as feelings that hinders the positive energy. The three areas from where the resistance comes are the political, cultural, and the technical systems that also include task based habit, fear of change and loss of sunk cost. The internal coalitions, limitations on resource availability and the idea that admit that changes are necessary for summons on past leaderships leads to political resistance. The perception that an organisation is a single unit, security is held by the past, and the culture currently in existence hinders change is the factors responsible for the cultural resistance. Further, transformational leaders are also important for bringing about changes within the organisation. The deeper study of this assumption leads to another assumption suggesting that a transformational leader is the key ingredient of a change. In order to revitalise an organization, a new vision should be created, commitment to be mobilized to that vision, institutionalising changes partly by measuring the organisational structure by the transformational leader. Going beyond three planned retirements, Iacocca stayed with Chrysler and appeared in over 80 commercials for the company and helped moving the company towards the desired direction on its ego and captivation. Iacocca remained a strong transformational leader, and after he retired Chrysler faced the same crisis again after 5 years and this time the organisation was bought by the German company of Daimler-Benz. Public values that are embraced the highest and protect the principles of the group of people to transform the organisational culture are defined by the transformational leaders. Recommendations For achieving change within the organisation, it is not just necessary to adapt to a leadership with charismatic appeal who could drive the organisation forward, but also important to understand that the changes need to be sustainable in the long run. The leaders are required to believe in their selves as well as the value systems in the organisation to drive changes within it. It has been found that the transformational leaders have been able to bring about successful changes within an organisation in the past. However, in the contemporary business world of turbulence, it is important to note that the authenticity of the leader is of foremost importance to draw the organisation towards change. A transformational leader needs be responsible towards not only himself but also towards his followers, stakeholders and employees. Then only the changes driven by such leaders could be effectively implemented. However, it is also to be kept in mind that transformational leaders may manipulate the situation as well as influence the employees towards themselves. Therefore, it is the responsibility of such leaders to mimimise their charisma and only put forth those ideas that would be beneficial for the organisation as well as the employees. Thus, it is imperative for the leaders to be authentic which would help in overcoming the possibility of manipulation. This can be achieved by being true to others and by being true to oneself. It has been found that there are people who are just leaders and some who are authentic leaders. These authentic leaders are the one who work passionately from their heart to improve the quality of the work of the daily workers as well as focus on value-adding the performance of the organisation, so that the company receives utmost benefit from his or her leadership qualities. Reference Armenakis, A.A., Harris, S.G. and Field, H.S. 1999, "Making Change Permanent: a model for institutionalizing change interventions," Research in Organizational Change and Development, Vol. 12, 97-128. Avolio, B.J., and Gardner, W.L., 2005, "Authentic Leadership Development: Getting to the Root of Positive From of Leadership," The Leadership Quarterly, 16 (2005), 315-338. Banner, D. K. and Gagné, E. T. 1995, Designing Effective Organisations: Traditional and Transformational Views, Thousand Oaks, California: Sage Publications. Bass, B.M. 1985, "Leadership and Performance beyond Expectations," Free Press, New York, NY. Charbonneaue, D. 2004, "Influence tactics and perceptions of transformational leadership," The Leadership and Organization Development Journal Vol. 25, No. 7, 2004 565-576. Clement, R.W. 1994, “Culture, Leadership, and Power: The Key to Organizational Change,” Business Horizons, January-February, 1994, 33-39. Holt, D., Self, D., Thal, A. and Lo S. 2003, "Facilitating Organization Change: a test of leadership strategies," Leadership and Organizational Development Journal, 24/5 (2003), 262-272. Kotter, J.P. 1995, "Leading Change: why transformational efforts fail", Harvard Business Review, March/April, 1995, 59-67. Novicevic, M., Harvey, M., Buckley, R., Brown, J. A. and Evans, R. 2006, "Authentic Leadership: A Historical Perspective," Journal of Leadership and Organizational Studies, 2006, Vol. 13, No. 1, 64-76. Popper, M. and Zakkai, E. 1994, "Transactional, Charismatic and Transformational Leadership: Conditions Conducive to their Predominance," Leadership and Organization Development Journal, Vol. 15, No. 6, 1994, 3-7. Schruijer, S. and Vansina, L. 1999, "Leadership and organizational Change: An Introduction," European Journal of Work and Organization Psychology, 1999, 8 (1), 1-8. Simons, T. 1999, "Behavioral integrity as a critical ingredient for transformational leadership," Journal of Organizational Change Management, Vol. 12, No. 2, 1999, 89-104. Tichy, N.M. and Ulrich, D.O 2008, “The Leadership Challenge – A Call for the Transformational Leader” (1984) in Classical Readings of Organizational Behavior, edited by Ott, Parkes, & Simpson, Thomson-Wadsworth, Belmont, CA, 59 - 68. Tushman, M. and Nadler, D. 1990, “Beyond the Charismatic Leader: Leadership and Organizational Change,” California Management Review, Winter, 1990, 77-97. Tyler, T.R. and Cremer, D.D. 2005, “Process-based leadership: Fair procedure and reactions to organizational change,” The Leadership Quarterly, 16 (2005), 529-545. Read More