The transformational leadership style involves being able to inspire others to make big changes. This style is about affecting an entire organizational culture by creating a vision that others can follow.
It is a style that is particularly useful when a company is suffering from stagnation and lack of innovation. When companies fail to innovate, they lose ground to competitors that are taking risks and looking to the future.
There are many examples of transformational leaders in the business world. Some of the most frequently mentioned transformational leaders are the CEO of Netflix, Reed Hastings, Henry Ford, and Richard Branson.
Definition of Transformational Leadership
Transformational leaders are usually energetic and passionate, have excellent communication skills and are able to see the big-picture.
They instill confidence in their employees and strive to develop each member of their team, which helps foster trust and company loyalty.
Therefore, the job requires someone with exceptional skills. As Bass and Riggio (2005) postulate, there are four primary characteristics of the transformational leader:
- idealized influence,
- inspirational motivation,
- intellectual stimulation, and
- individual consideration.
In other words, a transformational leader has these traits: charisma, the ability to motivate a team to accept a vision, encouraging innovation from all, and attending to each follower’s needs.
However, there are weaknesses of transformational leadership. For example, transformational leaders are often very pushy and insistent that people see and sign-on to the leader’s mission, and often don’t consult enough with their teams.
Examples of Transformational Leadership
1. Oprah Winfrey
The “Media Queen” started out as a radio host in Chicago, and then made her way to fame and fortune by hosting her own TV show called The Oprah Winfrey Show. It would eventually become the highest rated TV show in history.
Her success carried over to other ventures, including her appearance in movies and her charity work as a philanthropist. She was the first African American billionaire in North America and named one of Time Magazine’s most influential people in 2004, 2005, 2006, 2007, 2008 and 2009.
Her leadership has been characterized as being focused on inspiring her team to execute her vision, while at the same time acknowledging the role of predecessors, the power of the community, and the responsibility of helping others.
2. Henry Ford
Henry Ford was the founder of the Ford automobile company and single handedly changed the industry and treatment of employees. While observing the assembly line of a meat-packing plant, it occurred to him to apply the same principle to the manufacturing of cars.
He was one of the first in the industrial economy to recognize the value of treating his employees well and ensuring their needs were taken care of. He did this in many ways, one of which involved paying them a generous salary of $5 a day in 1914, nearly double the minimum wage at the time.
This helped propel the rise of the middle class and start a revolution in how companies treated their employees.
In one interview, Henry Ford stated that:
“If the floor sweeper’s heart is in his job, he can save us five dollars a day by picking up small tools instead of sweeping them out.”
3. The Lego Brand
Usually, an individual is an example of transformational leadership, but sometimes a company can embody this leadership concept as well.
Lego began in 1932 as a toy company in Denmark that made wooden toys. The first building blocks were invented in 1949; soon came cars, boats, people and LegoLand.
But in 1978 a very scary development occurred. The Lego patent for its bricks expired. All of a sudden, Lego was no longer the only game in town. Many predicted the demise of the company as competitors rushed in.
But Lego managed to keep innovating and adapting. The company signed an exclusive deal with the Star Wars franchise. Later came Bob the Builder, Harry Potter, and Spiderman, plus, video games. When YouTube became popular, Lego started making videos. Today Lego has over 50 full-length movies.
Lego is an example of a company that has been transforming itself for nearly 100 years.
4. Gregg Steinhafel: Target
Gregg Steinhafel was appointed CEO of Target in 2008. The company was experiencing slipping sales and losing ground rapidly to competitors. It was also at a time when the entire world economy was collapsing due to the US mortgage crisis.
Despite this challenge and many others, Steinhafel kept the company’s focus on merchandising. The stock went from a low of $26 to a high of $59 just two years later. A remarkable turnaround in a horrible economic environment.
The years that followed centered on three transformations: resurrecting Target’s online presence, growing the brand image with private labels from celebrities, and expanding into the food sector.
His philosophy can be understood in the following quotes:
“We constantly push our teams to move ahead, but not too far ahead…You can make as many mistakes by being too slow as by upgrading too fast…We’re an organization focused on innovation…so we encourage everyone to think about what’s next.”
Some examples of transformational leadership come from the sports world. Billy Beane is one of those examples. Before he became general manager of the Oakland As, baseball was a sport steeped in tradition. One might say it was trapped in tradition.
Coaches, scouts, general managers, owners, players, and sports journalists all shared the same way of thinking about how to win. Scouting was based on direct observation of players that fit a certain mold.
But Billy Beane implemented data-analytics to select players based on statistical data, almost exclusively. This meant signing players that didn’t fit the prototype of a position: players in the outfield that were slow or overweight and pitchers with unorthodox techniques.
Players were chosen that no one else wanted simply because they fit a data pattern that, statistically speaking, would produce wins. And that is exactly what happened. His teams went on to make history and data-analytics transformed the game.
6. Reed Hastings, CEO of Netflix
Reed Hastings and Marc Randolph started Netflix in 1997. The business model involved subscribers renting DVDs through the internet, which could be returned late with no penalty.
That was in stark contrast to their main brick-and-mortar competitor, Blockbuster.
In 2007 the company started a live-streaming service, which was a real game-changer. Today the company also produces its own content and is the number one streaming service in the world (Blockbuster is now out of business).
The success of Netflix is often attributed to the leadership style of Reed Hastings. He prides himself on trusting his employees. In an interview with Stanford Business, Hastings is quoted as saying:
“I take pride in making as few decisions as possible, as opposed to making as many as possible… It’s creating a sense [in your employees] that ‘If I want to make a difference, I can make a difference.’”
7. Richard Branson
When experts in leadership want to provide an example of charismatic leadership, Richard Branson tops the list. His warm and friendly personality makes everyone around him feel welcomed and appreciated.
You can often see his presence on social media, smiling for photos with line-level employees, his arm often draped around their shoulders.
He founded the Virgin Group in 1989 and today it’s a multinational company with over 400 businesses and 50,000 employees around the world.
You can get a sense of his leadership style through his own words:
“From a young age, I learned to focus on the things I was good at and delegate to others what I was not good at. That’s how Virgin is run. Fantastic people throughout the Virgin Group run our businesses, allowing me to think creatively and strategically.”
When people are trusted by the CEO, it makes them feel appreciated and respected.
8. Susan Wojcicki
YouTube CEO Susan Wojcicki started working at Google in 1998 and became the head of YouTube in 2014.
Some of her most notable accomplishments at Google included spearheading the effort to purchase YouTube in 2006 and Google AdSense, both of which have brought tremendous profits to the company.
Some of her other initiatives included increasing paid maternity leave from 12 to 18 weeks and implementing a cross-functional work-team format. This encourages collaboration of smaller work teams that will lead to the creation of more innovative solutions for the company.
In addition to her incredible business sense, she has demonstrated tremendous fortitude when confronting controversial issues centering on free speech. YouTube is a platform of individuals expressing themselves in an endless manner of forms. It takes a leader with resolve and courage to hold steady to the company’s fundamental principles.
Starting as a paper mill in Finland in 1865, over the subsequent 150 years it transformed its business model numerous times. In addition to making paper products in those early days, it quickly expanded into electricity generation, rubber products, and communications cables.
In the late 1970s, the company expanded into Europe with the production of phones and the world’s first international cellular network. However, in 1991, the company became overwhelmed with debt and losses. The company seemed doomed.
Fortunately, the crisis compelled the BoD to make several bold decisions that involved selling off numerous product lines and focusing solely on telecommunications. By the turn of the century, Nokia was the global leader in mobile phone sells, which lasted until 2008. After the 2007 introduction of the Apple iPhone, the end was near. We all know what happened next.
Nokia transformed itself again to focus on 5G infrastructure and doing quite well globally.
10. William Edwards Deming
Dr. Deming is considered the creator of Total Quality Management (TQM). The fundamental principles of TQM include: using data to objectively monitor performance, continuously strive for improvement, implement a process-oriented approach that incorporates all inputs and outputs, and empowering all employees to work toward common goals.
Many of TQM principles are included in modern management systems today. After WWII, Deming was tasked with installing TQM into Japan’s manufacturing industries.
Japan quickly grew into a worldwide manufacturing giant and is currently the world’s third largest economy. Transforming a single company can be a real challenge, but being able to transform the economy of an entire country is truly amazing.
More Transformational Leaders
- Condoleezza Rice – First black female U.S. Secretary of State credited with transforming how the US did foreign affairs.
- Jeff Bezos – Amazon Owner credited with transforming how we shop in the 21st Century. He created the most successful e-commerce business by inspiring his team to think bigger than anyone else had before.
- John F Kennedy – Kennedy asked America to shoot for the moon, something that many didn’t believe possible. His vision and funding of NASA led to the first moon landing in 1969.
- Nelson Mandela – The former President of South Africa helped transform the nation from its colonial past and implemented a multi-racial and more equal participatory government. (Mandela is also famed for his democratic leadership style).
- Steve Jobs – While Jobs was fired from Apple for being too much of an autocratic leader, he was later brought back because his vision and design skills were unmatched.
- Barack Obama – While many are disappointed with Obama’s time in office, he transformed how the USA saw itself by becoming the first black president.
- Abraham Lincoln – Lincoln finally rid the US of slavery and didn’t back down from his principled stance in defense of equality for all.
- Winston Churchill – Hailed as the man who turned around the Allied war effort in WWII, many in the UK attribute the victory to his leadership style.
- Martin Luthur King Jr. – During the civil rights era, Dr. King stood up against oppression and forced change in American society.
- Princess Diana – At a time when the British Monarchy was seen as stale and out of tough, Princess Diana revitalized its public image by very actively advocating for the poor and needy.
- Jackie Robinson – By forcing his way into the all-white Major League Baseball, Jackie Robinson broke barriers and transformed baseball forever.
- Genghis Khan – While he was an evil dictator, Khan was also undoubtedly transformational. He turned warring nomadic tribes into the enormous Mongul Empire.
- Volodymyr Zelenskyy – His rhetorical skills and dogged determination in facing down Russia in Ukraine in 2022 have turned Zelenskyy into a transformational leader of the 21st Century. He inspired his people to stand up to the bully when it was expected that his nation would fall in just 3 days at the hands of Russia.
- Mahatma Gandhi – Gandhi is known as the father of India. He inspired the nation to participate in nonviolent protest to force the British colonizers out of the nation.
- Elon Musk – Musk has a big vision for the future of the world and inspired others to support his vision. He has turned around several companies including Tesla which almost went bankrupt several times.
- Jesus Christ – While most commonly known as the quintessential service leader, there is also perhaps no leader more transformational than Jesus. He inspired a whole new religious movement that became the largest in the world.
- Moses – According to the Old Testament, Moses inspired his people to flee slavery and follow him through the desert to freedom.
- Lee Political Dynasty (Singapore) – The Lee political dynasty have ruled Singapore for decades. On the one hand, they rule through some rather un-democratic electoral policies, but on the other hand, they have used business strategies to turn the once poor city into the most powerful and prosperous city-state in the world.
- The Founding Fathers – The founding fathers of the United States created a constitution that inspired the world and led to the greatest global superpower since the Roman empire.
- Larry Page – The Google CEO turned a tiny search engine into one of the world’s largest corporations. Page is known for being willing to pursue new ideas through research and development while adhering to the motto “don’t be evil”.
- Tim Cook – Earlier we discussed Steve Jobs as a transformational leader. But when Job’s company, Apple, was on its knees, Tim Cook turned the company around and helped put it in a good financial position.
- Nintendo – After the early success of the Nintendo game consoles, the company almost went bankrupt. Through innovation and transformation, the company released the Nintendo Switch console which saved the company.
- Howard Schultz – Like Nintendo, Starbucks almost went broke. This happened in 2008 during the financial crisis. The Starbucks CEO, Howard Schultz, took some extraordinary and difficult steps (including closing stores and laying off many employees) to save the company and right the ship.
- Lou Gerstner – Gerstner, the CEO of IBM, rescued this ailing company by laying off 100,000 people, focusing on B2B rather than B2C interactions, and changing the corporate culture. While some might say laying off so many people excludes him from this list, he also undoubtedly transformed IBM.
- Susan B Anthony – At her peak, Susan B Anthony gave up to 100 speeches a year across the USA in the service of women’s suffrage. Her inspiring speeches and grand vision make her a good example of a transformational leader.
Transformational leaders have the most difficult job in the business world. They are often tasked with taking over the reins of a failing company. The top executives of that company are usually stuck in an old leadership style that was responsible for the company slipping in the first place. They can be highly resistant to change and may try to fight the new CEO at every turn.
This is the perfect job for a transformational leader. A person that can see the big-picture years ahead. By anticipating change and creating a vision that others can follow, the transformational leader is able to propel a company to new heights that were unimaginable by most.
Next, read about all 20 leadership style examples.
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Nilsson, J. (2014, January). Why did Henry Ford double his minimum wage? The Saturday Evening Post. Retrieved from https://www.saturdayeveningpost.com/2014/01/ford-doubles-minimum-wage
Snyder, B. (2014, November). Insights by Standford Business. Stanford Graduate School of Business. Retrieved from: https://www.gsb.stanford.edu/insights/netflix-founder-reed-hastings-make-few-decisions-possible
Taylor, B. (2017, November). How Coca-Cola, Netflix, and Amazon learn from failure. Harvard Business Review. Retrieved from: http://clarionconsulting.com.au/wp-content/uploads/2018/06/HBR-Learn.From_.Failure.CCA_.Netflix.pdf