Transformational Leadership - A Complete Guide |

You may have experienced in your professional working life someone who manages to take control of a situation through having a clear vision of the group’s goals, a passion for work and even making you feel energized in the whole process. In return, you end up looking up to this person, you feel like they have a complete grasp on things or instill a level of confidence that gets you performing even better. 

This person is a transformational leader. 

Discovering who the transformational leaders are in your organization is not only a positive business advantage but, it is also a powerful resource that you can use to help inspire your teams and certain individuals to perform better. 

In this guide we are going to look into transformational leadership, the components of a transformational leader and the characteristics of what a transformational leader is. 

What is transformational leadership?

Transformational leadership is when someone or some people in your organization are incredibly dedicated, enthusiastic, energetic and passionate about the role - and by being so, they can inspire and help every member of the team whilst also improving the business at the same time. 

Leadership expert James MacGregor Burns introduced the concept of transformational leadership in his 1978 book, "Leadership." He defined transformational leadership as a process where "leaders and their followers raise one another to higher levels of morality and motivation." 

Later, in 1985, researcher Bernard M. Bass developed the concept of transformational leadership. According to his 1985 book, "Leadership and Performance Beyond Expectations," this kind of leadership style includes ways for measuring the success of transformational leadership. This model encourages leaders to demonstrate authentic, strong leadership with the idea that employees will be inspired to follow suit. According to Bass, a transformational leader displays the following characteristics:

  • Transformational leadership is a leadership style in which leaders encourage, inspire and motivate employees to innovate and create change that will help grow and shape the future success of the company. This is accomplished by setting an example at the executive level through a strong sense of corporate culture, employee ownership and independence in the workplace.
  • Transformational leadership focuses on the needs of others, rather than the needs of the leader. Similar to servant leadership, but differs because in each style the leader has a different focus.

For many in the field of this research, transformational leadership has some roots based on the idea of charisma. Of course, charisma is nothing new - it’s a relatively old concept however over the last 40 years, the idea has become even more popular as it is underpinned by the idea that employees have been “overmanaged but underled.”

You can think back to some of the great historical leaders who have managed to rally their teams in times of adversity, development or even trying to achieve their goals. People like Bill Clinton and Tony Blair in politics had to overcome nearly 20 years of an electorate voting the opposite way to overturn results - this was done, as many consider, through charisma on screen and behind the scenes. 

In the same way, people in business today such as Elon Musk or Gary Vaynerchuck - whether you agree or disagree with their practices, have managed to change the face of how we view leadership in building up those around them to get what is needed for the business to achieve. 

It’s no coincidence then that charismatic leaders also are sometimes called transformational leaders because they share multiple similarities. However, their main difference is focus and audience. Charismatic leaders often try to make the status quo better, while transformational leaders focus on transforming organizations into the leader's vision.

According to Bass, transformational leadership can be defined based on the impact that it has on followers. Transformational leaders, Bass suggested, garner trust, respect, and admiration from their followers.

In today’s digital business world, transformational leadership can be even more transparent through the kind of content that they put out in social media and other platforms to help spread both the vision and create a mass following behind it all.


Transformational leadership components

There are of course some select components to transformational leadership. In fact, Bernard M. Bass suggested there are four different components of transformational leadership and these include:

Intellectual stimulation

Enabling and compelling employees to look outside their self-interest to the needs of the team and organization, challenging their mindsets, ideas and beliefs to drive growth and performance, encouraging creativity, collaboration and the pursuit of excellence.

Transformational leaders not only challenge the status quo; they also encourage creativity among followers. The leader encourages followers to explore new ways of doing things and new opportunities to learn.

Individualized consideration

The transformational leader focuses on the needs, dreams and fears of the individual, knowing that these are key to understanding how to create an environment that empowers employees to perform.

Transformational leadership also involves offering support and encouragement to individual followers. In order to foster supportive relationships, transformational leaders keep lines of communication open so that followers feel free to share ideas and so that leaders can offer direct recognition of the unique contributions of each follower.

Inspirational motivation

Building a compelling vision for the future, setting clear goals that stretch employees and recognize potential, as well as being positive about employee development.

Transformational leaders have a clear vision that they are able to articulate to followers. These leaders are also able to help followers experience the same passion and motivation to fulfill these goals.

Idealized influence

To what extent are the leader role model behaviors consistent with the overall vision they have set out and does this role modeling engage employees to move towards the leader and the vision?

The transformational leader serves as a role model for followers. Because followers trust and respect the leader, they emulate this individual and internalize his or her ideals.

Transformational leadership characteristics

We’ve come to understand that transformational leadership as identified in research from the late 70s and early 80s is where  "leaders and their followers raise one another to higher levels of morality and motivation" and their constituent components include intellectual stimulation, consideration, motivation and influence. 

But, what are the characteristics of a transformational leader? What are their values and what is it that they are transmitting to their peers/followers/employees? Here are just a few characteristics to consider. 

  • Demonstrates integrity and fairness

They wouldn’t take a course of action, or ask anyone else to take one if they didn’t feel it was necessary and in return, be the first to do it themselves. 

  • Encourages motivation and positive development

They have the ability to help others rise to the goals of the organization/task and inspire confidence that it can be done at the same time. 

  • Sets clear goals

All leaders must be able to clearly set goals, but a transformational leader does this without hesitation or deviation. There has to be a goal or a vision that everyone can work towards. Whether it is hitting sales targets or having a 3 year plan that can rapidly transform and change the organization as a whole - broken down into stages - this is where the transformational leader develops their abilities

  • Exemplifies high moral standards and encourages the same in others

“Do as I say and do” is the mantra here. There is a granite-like mental approach to creating a moral standard that helps to encourage others to achieve the same. 

  • Has high expectations

Whatever it is that has to be achieved, setting the expectations at the highest level is a characteristic of the transformational leader. There’s no point going for mediocre, if you’re going to put your energy into something, be sure to be aiming for the highest level. 


  • Fosters an ethical work environment with clear values, priorities and standards

As with the high moral standards, there is a sense from the transformational leader that clear values, the priorities and developing an ethical work environment is paramount to success. 

  • Provides encouragement

This is where the transformational leader is really thriving. It’s about imparting that energy and drive to make whoever in the team take note and be energized to the task at hand. 

  • Promotes cooperation and open communication

Leaders find ways to get people to talk and to communicate freely. The transformational leader does this to not only help others see where there may be issues but also use the team to help find solutions at the same time. 

  • Provides support and recognition

A transformational leader is also someone who manages to understand where there may be difficulties and in return, help or where a team member has done some great work - it’s about championing it and recognizing why it worked so well. 

  • Encourages people to look beyond self interest toward working for the common good

A team united is better than a team divided - as the old adage goes. Transformational leaders find a way to inspire individuals to work together for the same goals rather than splintering off to think about self-interests. 

  • Keep their egos in check

Sometimes leaders can be a little too egocentric. Transformational leaders strive to keep their egos under control, putting the best interest of their team and their organization before their own personal gain.

  • Ability to take the right risks

Transformational leaders overcome irrational fears and evaluate risks in terms of obstacles, capabilities and the vision of the organization. 

  • Proactive approach

This style of leadership can lead to innovative solutions to a problem the customer may not have even recognized.

When combined, these characteristics relate to the 4 components of transformational leadership. 

Positive effects of transformational leadership

Most of the research around transformational leadership indicates that there are positive effects across individuals and groups. 

Leadership expert, Ronald E. Riggio in an article for Psychology Today says that "research evidence clearly shows that groups led by transformational leaders have higher levels of performance and satisfaction than groups led by other types of leaders" whilst in the textbook Transformational Leadership from Bass (and Riggio) “Transformational leaders help followers grow and develop into leaders by responding to individual followers' needs by empowering them and by aligning the objectives and goals of the individual followers, the leader, the group, and the larger organization.”

What are some of the positive effects that transformational leadership can have on a workforce? Here are some examples:

Reduces staff turnover

Inspiring leaders encourage staff to stick around and not go looking for alternative employment - through their management style. By boosting employee morale and by helping them achieve personal satisfaction, transformational leaders often are able to retain more employees than other common leadership styles.

Obviously, being able to retain staff is important but being able to retain really good staff has benefits throughout the organization. From reducing the amount of time, money and energy in trying to replace staff to having better performing staff members stay in their positions or even advancing is a positive for the whole organization. 

Drives employee engagement

Being able to understand and recognize the needs of their followers / staff transformational leaders find ways to keep not only their staff happy but also, engaged in the organization and their work. 

For example, a transformational leader may be able to identify that specific training is required to keep staff engaged. In one study, 80 percent of surveyed employees said that learning and development opportunities would help them feel more engaged at work. This is further supported by data which shows that a more engaged workforce is a better customer service engaged workforce by nearly 90 percent. 

Boosts motivation and morale

Transformational leaders understand that strong, healthy relationships are at the heart of all business operations. They know that boosting staff morale drives employee motivation and encourages them to want to improve their relationships with each other and with customers.

Transformational leaders are highly motivated and energetic, their charisma helps bring a vision to the organization and team whilst using their communication skills to effectively motivate their employees. 

Supports change

Change can be a worrying time for many employees but transformational leaderships know how to make change appear both positive and essential for many different business cases. Transformational leaders in particular know how to get staff excited about and interested in change.

These leaders understand the importance of promoting a willingness to change - especially in response to fast technological advancements and other challenges (such as the increase in working from home).


Encourages learning and development

In addition to working towards a unified goal and improving self morale and satisfaction in employees, transformational leaders encourage their employees to continue improving by creating opportunities to face new challenges. They help their teammates discover their own capabilities by bringing them out of their comfort zone.

When an employee’s growth becomes stagnant, it directly affects the growth of the business. Good transformational leaders keep their teammates engaged in their work and open to new learning areas to help them grow consistently.

Transformational leaders understand how to develop and promote a learning culture that contributes toward high employee engagement.

Promotes collaboration

Transformational leaders recognize and promote beneficial collaboration between staff. Not only does it enhance communications and leads to creative problem solving it helps to improve greater staff engagement.

This style of leadership encourages staff to look beyond their self-interest to the needs of their team, workmates and the organization.

Enhances communications

The transformational leadership style involves providing people with regular feedback which promotes improved two-way communication and keeps people on the right track.

This helps to resolve issues before they become issues and find solutions for better working and development. 

Prioritizes ethical behavior

Transformational leaders exemplify and demonstrate high moral standards. They develop ethical work environments which means that there is a general sense of combined purpose and understanding of what is right and wrong for the business and the leader. 

Establishes strong relationships

Transformational leaders are conscious of the fact that in order to build a strong business, one must start with building sturdy and healthy relationships.  All strong relationships rely on honest and transparent communication. 

New corporate visions can be quickly formulated

Transformational leaders do an excellent job of incorporating a new vision into their current situation. They are also good at recognizing gaps or problems in the process of a vision, which allows them to make adjustments or recommendations to correct the situation immediately. 

It quickly changes low-morale situations

When a company is struggling for a long time period, they typically use transformational leaders to boost morale and change the environment. The passion, enthusiasm, and high energy levels encourage and inspire others to find success.


We have all experienced good leadership in our careers at some point, but a transformational leader is someone who can not only inspire others, they can clearly create a vision and engagement that gives encouragement and motivation to everyone in the business. 

Based primarily on charisma, a transformational leader can bring many benefits to an organization and these can include: 

  • Reducing staff turnover
  • Boosting morale
  • Promote collaboration
  • Encourage development 
  • Enhance communication 

Thomas assessments can help organisations identify who exhibits the traits of a transformational leader and provide the necessary platform to develop these skills through identifying needs and training to those needs.