Transformational Leadership: Theory and Reflections

by Richard Parrott

Richard Parrott (M.Div., Nazarene Theological Seminary; Ph.D., Oregon State University) is Executive Director of The Sandberg Leadership Center at ATS and also Director of the D.Min. program.

“Be transformed by the renewing of your minds…” (Romans 12:2)

Consider excerpts of four conversations:

Your organization is guided by vision and values. I know there are times you make hard decisions. I also know you surprise people by making the tough decisions in the right way. This is what I want to know: How do you recognize a decision of organizational values rather than organizational profit? And, what do you have to do internally to make the decision, especially when it is costly? (Author to Executive Vice-President of State Farm Insurance) 

And we couldn’t agree on the subject of my presentation. But then, it came to me as a revelation; the content doesn’t matter. These people just need to connect. They don’t need more information, they need to want more from what they are doing. (Executive Director of the Program on Non-Profit Organizations to the author) 

You have to love the process. It is not the paper, but the process that matters. Most of what you learn never goes in the paper, but the process changes the way you think; it gives foundation to ministry. (Faculty members of ATS discussing the doctoral dissertation with the author) 

Our love for Jesus must be greater than our love of money or fame or anything else. (Author’s pastor in a recent sermon)

Each statement is an expression of the “new leadership paradigm” (Bryman 1992). Transformational leadership is concerned with vision, values, ethics, and relationships. It is a process of leadership in which the motives, needs, and humanity of followers is given full consideration. At the heart of the process is the visionary leader.

Transformational leadership is making an impact on the church. In August, 1999, Noel Tichy, theorist and teacher of transformational leadership (Tichy and DeVanna 1990; Tichy 1997), spoke to the Willow Creek gathering of church leaders, the largest annual conference on Leadership in the evangelical world. Ten years earlier, Lyle Schaller introduced the term to church leadership, “The transformational leader is driven by a vision for a new tomorrow, wins supporters and followers for that vision, and transforms the congregation” (Anderson 1990, 188). Of particular interest to the community of Ashland Theological Seminary is the incorporation of the term in the mission statement of the new Sandberg Leadership Center, “We are a center of transformational learning, committed to the spiritual and character formation of servant leaders who will make a difference in business, government, the church and society” (Finks and Parrott 2000).

The purpose of this paper is to present the theory of transformational leadership as found in the social sciences and to offer reflections on the practice, biblical foundations, and personal implications of the theory.

I. Theory

First coined by Downton (1973), the significance of transformational leadership emerged in the classic work of the political sociologist, James McGregor Burns (1978). Burns distinguishes two types of leaders: transactional and transformational. Transformational leaders initiate and maintain a relational process that raises the level of motivation and morality in both the leader and the follower. Mahatma Gandhi is the classic example. Transformational leadership is rooted in shared vision and concern for the needs of followers.

Transformational leadership is closely linked to the theory of charismatic leadership (House 1976).[1] Such leaders demonstrate five characteristics: 1) modeling of beliefs and values, 2) appearing competent to followers, 3) stating goals ideologically and with moral overtones, 4) having high expectations for and confidence in followers, and 5) motivating followers through affiliation, power, and esteem. House admits that charismatic leadership tends to emerge in times of distress.

A refined version of transformational leadership theory was set down by Bernard Bass (1985). Extending the work of Burns and House, Bass describes transactional and transformational leadership as a single continuum (Yammarino 1993). Transformational leaders move people to go beyond expectations. They help people transcend self-interest for the sake of the greater good. They address the higher-level needs of followers (Bass 1985).

In his recent book, Avolio (1999) elaborates on the dynamics of the “model of transformational and transactional leadership” (Bass 1985, 1990; Bass and Avolio 1993, 1994). Transformational leadership is characterized by four factors. Transactional leadership is characterized by two factors.

Transformational Leadership

Transformational leaders are concerned with two issues: the performance of followers and the development of followers (Avolio 1999; Bass and Avolio 1990a). These leaders lift followers beyond self-interest with strong internal values and ideals (Kuhnert 1994). Four factors (known as the Four “I’s”) emerge:

First, idealized influence. This is charisma. Leaders are strong role models that people want to emulate. They have high standards and can be counted on to do the right thing. They have deep respect for people and place deep trust in them. They provide vision and mission. Followers say of these leaders: I feel good when I am around them; I have complete faith in them; I am proud to be associated with them.[2]

Second, inspirational motivation. Leaders cultivate commitment to a shared vision. Using symbols and emotions, they focus the efforts of the group with high expectations and team spirit. Followers say of these leaders: they say in a few simple words what we can and should do; they provide appealing images of what we can do; they help us find meaning in our work.

Third, intellectual stimulation. Leaders stimulate others to be creative and innovative. They challenge beliefs and values, and they encourage followers to challenge the leader and the organization. Such leaders support creative problem solving and new approaches. Followers say of these leaders: they help me think about old problems in new ways; they give me new ways to look at puzzling things; they help me rethink ideas I never questioned before.

Fourth, individualized consideration. Leaders support individuals by carefully listening, acting as coach and advisor, seeking to assist individuals to become more actualized. They help followers grow through personal challenges. At times the leader may be directive with a high degree of structure, while at other times s/he may deepen the relationship with the follower. Followers say of these leaders: they help me develop; they let me know how they think I am doing; they give me personal attention when I feel rejected.

Transactional Leadership

The transactional leader does not consider the needs of each individual. Transactional leaders do not focus on personal development. Transactional leaders exchange things of value so that work may be done and goals accomplished (Kuhnert 1994). It is in the follower’s best self-interest to do what the transactional leader wants done (Kuhnert and Lewis 1987). Two factors emerge:

First, contingent reward. The key competency for the transactional leader is to negotiate fair outcomes. The leader obtains an agreement on what needs to be done and what the payoff will be. The effort of followers is exchanged for specific rewards. Followers say of these leaders: they let me know what I have to do and what reward I will get; they provide me with recognition and rewards when I reach my goals; they show me what others receive when they reach their goals.

Second, management-by-exception. The second tool for transactional leaders is corrective criticism. It is negative feedback coupled with negative reinforcement. There are two strategies: a) monitor employee patterns, watch for mistakes and violations, then take corrective action; or b) monitor work outcomes, watch for sub-standard work and problems, then take corrective action. Followers say of such leaders: they are satisfied when I meet the agreed upon standard; they don’t interfere as long as things are working; they tell me what is expected in my work.

An analysis of thirty-nine studies in transformational leadership found that individuals who exhibit transformation behaviors (the Four “I’s”) were perceived as more effective and had better work outcomes than leaders who exhibit only transactional behavior (Lowe, Kroeck, and Sivasubramaniam 1996).

Two other research groups began investigating transformational leadership using open-ended questions and content analysis. Bennis and Nanus (1985) interviewed 90 leaders and report four common strategies: articulating a shared vision, being a social architect, creating trust, and creatively fusing a sense of self with the work. In a similar research model, Tichy and DeVanna (1986, 1990) interviewed 12 CEO’s on how they carried out the change process. The common pattern was a “Three Act” process of: Act 1) recognizing the need for change; Act 2) creating a shared vision for change; and, Act 3) institutionalizing change.

II. Reflections

As I move from theory into reflection, my paper will move from objective to subjective, from formal to informal (from transactional to more transformational). What I want to share is out of my own heart and mind. These are issues that matter to me in my attempt to be a transformational leader at The Sandberg Leadership Center. These are my struggles and convictions, expressing my values and uncertainties. Like you, I am much more comfortable telling you what I know rather than opening up who I am. Yet, transformational leadership begins with appropriate transparency.

I am going to reflect in three ways: on practice, on biblical foundations, and on personal implications. My thoughts are not complete. They will change in the months and years before me. But, for now, these are points of conversation with the challenges I face in learning to be a transformational leader.

The words that follow are “Richard’s Reflections.” They start that way. However, it is my hope that these thoughts will cause you to reflect, question, converse, challenge, and commit. It is when these written reflections fade and your own reflections come into focus that I fulfill my hope of being some small part of the transformational process in your life.

On the practice of transformational leadership.

Transformational leadership is a balancing act. For example, I must focus on shared vision with a group and also on individual development. I must focus on the greater good of the organization while also concerning myself with each individual’s needs. I must focus on clear values that act as non-negotiables while engendering genuine respect for opposing views. I must focus on motivating beyond the realm of self-interest yet attend to the personal fulfillment of each person who works in the organization. I find the practice of transformational leadership fraught with temptation.

First, it is tempting to cloak transactional behavior under transformational language. Many churches have a vision statement. Let me ask, does your church have a shared vision? Many churches have leadership training classes. Do you evaluate the personal development that results in people who give the time to go through the program? Many churches have ministry teams. For teams to be empowering, teams must have power to make real decisions. Do they?

I must speak a strong word with leaders who seek to be transformational: integrity. You can use many transactional programs halfheartedly in the church, and people will accept it; the latest evangelism program, the next giving campaign, the most recent training package. If you falter on any of these, people grumble a bit and the church goes on. However, transformational language is different. It is personal. It is full of promise. It is demanding of sacrifice. If you or I falter here, the results are personal. If you say “shared vision… respect opposing views… team ministry… deep trust in people,” you must back it up with behavior. Fail here, and people will not think you incompetent but immoral. Fail here, and people will resist commitment the next time.

Second, it is tempting to forget the importance of good transactional leadership. A good transactional leader negotiates fair rewards. Imagine an organization where the rewards are unfair. A good transactional leader makes tasks and roles clear. Imagine an organization where you don’t know what’s expected of you or what authority you have. A good transactional leader provides appropriate recognition. Imagine an organization where you are never recognized for goals achieved. A good transactional leader corrects what is wrong. Imagine an organization where problems are never addressed and negative behavior is ignored.

I believe many organizations need to address quality transactional leadership as they become transformational. I would go so far as to state that transformational leadership is supported by good transactional practices. When the distribution of bread was unfair (transactional practices), the transforming power of the church ground to a halt (Acts 6:1). When transactional practices were in place, transformation emerged (Acts 6:7).

I have always been naturally inspirational, but I have not always been transformational. My incompetence came at the point of not knowing how to provide the structure and support for change. There is a level of rewards, recognition, roles, standards, and fairness that acts like a foundation. As I remember, God in grace sent the right people who quietly provided the needed pilings and framework. I am finding that it is good to reach for the stars as long as the organization is well grounded.

Third, it is tempting to serve the wrong master. Organizations with clear and positive transactional practices often find it difficult to move into a transformational realm. This is indicative of the famous seven last words of the church, “We-never-did-it-that-way-before.” The question I ask constantly is this: do transactional practices support or stifle transformational processes? Let me ask you the question in several ways: does your decision making process develop wisdom or despair in individuals? Does your problem solving invite or reject opposing ideas? Does your recognition procedure reward or punish “beyond the call of duty” behavior?

You may be leading an organization strapped by a transactional mindset. Remember, the only time a person willingly gets out of a comfortable chair is when it becomes a hot seat. Transformational leaders are change agents. This means initiating instability, fostering opposing views, and implementing new directions. Not everybody likes this. And when you do it, they won’t like you either. Learn to ask yourself (and then others): what is happening now (the facts)? Why is it happening (the motives)? What will happen if you continue this way (the predictions)? What are you willing to do to make a difference (the commitment)? (Markham 1999). Put yourself in the hot seat before you put someone else there.

On the biblical foundations of transformational leadership

My first observation concerning the biblical foundations of transformational leadership is that I am not trained to make such declarations. I have a Master of Divinity degree of some years ago and twenty-plus years of pastoral ministry. This is a far cry from advanced degrees in hermeneutics, historical theology, original languages, and all the skills associated with the kind of person who would dare comment on “the biblical foundations” of anything.

Academically, I am not qualified. As the leader of a Christian organization, however, I am required to deal with transformation and Scripture. The transformational model is secular in origin. It uses many terms that have spiritual and Christian overtones. I would not declare the model as anti-Christian or un-Christian, but its foundations are non-Christian. This word of caution is echoed in the synoptic Gospels. The word “transformed” (metamorphoo) “is used four times (Matt. 17:2; Mk. 9:2; Rom. 12:2; 2 Cor. 3:18) and is apparently deliberately avoided once. This omission is in the Lucan account of the transfiguration of Jesus, possibly because Luke did not want to use a term which could invite comparison with the pagan ideas of transformation” (Liefeld, 861–862).

As a place to begin this search for foundations, consider a familiar verse: “Seek first the kingdom of God and his righteousness and all these things will be added unto you” (Matthew 6:31). This is, at once, a word of great transformation or the lowliest of transactions. To the transformed heart, it is a verse of inspiration, it declares the grand will of God, it calls to higher needs and loftier motives, it empowers the believer to risk all and rest in the care of the Father. Yet, to the heart locked in transaction, the verse cuts a bargain with the Almighty: “God, I will seek Your Kingdom, but You have to give me the stuff.”

Like most children growing up in the faith, I considered the way of Christ to be a way of transactions. The language was transactional with talk of rewards and punishments, crowns and cruelty. The common illustrations were variations on the courtroom transactions. The worst image, to my recollection, was God so angry he beat up on a nice person like Jesus so that he didn’t have to beat up on me. We were asked to “put faith” in this angry God who “really loves you.” Such faith turns life into a hard path of keeping on God’s good side or at least keeping off his radar screen. We learned that, like a grand transactional manager, “the Father up above is looking down…” with rewards and punishments for little boys and girls.

This is a child’s twisted understanding of Christianity. However, deep-seated memories, homiletic reinforcement, and theological immaturity continue to feed this childish and pagan form of Christian faith. Appeasing an angry god is paganism. It is transactional religion: “If I do this, God won’t get angry; and if I do that, God owes me a blessing.” This is not the Christianity of the early church. William Neal cuts to the heart of transactional faith:

It is worth noting that the “fire and brimstone” school of theology who revel in ideas such as that Christ was made a sacrifice to appease an angry God, or that the cross was a legal transaction in which an innocent victim was made to pay the penalty for the crimes of others, a propitiation of a stern God, find no support in Paul. These notions came into Christian theology by way of legalistic minds of the medieval churchmen; they are not biblical Christianity (Neal 1965, 89–90).

The cross is not God inflicting wounds on another, but God receiving the suffering himself. Isaiah saw that the “servant” would suffer at the hands of God; but, who would have believed that the “servant” would be God. All of God was in Christ. “God was pleased to have all his fullness dwell within him” (Col. 1:19) and “in Christ the fullness of the Deity lives in bodily form” (Col. 2:9). The incarnate God was on the cross. It was there that “God was reconciling the world to himself in Christ, not counting men’s sins against them” (2 Cor. 5:19). This is not mere exchange but real change. It is not a simple transaction in the best interest of both parties: this is transformation. This is based in higher needs, loftier motives, a new relationship, a transforming vision and Kingdom values.

Atonement cannot be left as a simple transaction. It must be transformational. It results in the transformation of the sinner (2 Cor. 5:17). But, the grand beginning of transformation was when “the Word became flesh” (John 1:14). It has been suggested that the incarnation that began in the womb of Mary was completed on the cross of Calvary (conversation with Dr. Dan Hawk of ATS). When incarnation and atonement are wedded as two parts of the same event, the transaction of the cross is a transformation of the soul. What we see in the cross is not an angry deity transacting his vengeance on the innocent, but the loving and grace of God transforming his ways with us. In this sense, God changed.

John Stott writes, “If it may be said that the propitiation ‘changed’ God, or that by it he changed himself, let us be clear he did not change from wrath to love, or from enmity to grace, since his character is unchanging. What the propitiation changed was his dealings with us” (Stott 1986, 174). Stott agrees with P. T. Forsyth, “The distinction I ask you to make is between a change of feeling and a change of treatment… God’s feeling toward us never needed to be changed. But God’s treatment of us, God’s practical relation to us—that had to change” (Forsyth 1910, 105).

I believe this ne’er-do-well theologian is far enough out on the limb to open a conversation on the theological implications of transformational leadership. From this perch, let me state my point: you cannot be a transformational leader if you are caught in a transactional form of Christianity. Your theology precedes your practice. And, your experience precedes your theology. The admonition of Paul is clear (he was not afraid of the pagan origins of the word), “Be transformed (metamorphoo) by the renewing of your mind” (Rom. 12:2).

I want to stress the point because I believe there is danger lurking in the transformational model of leadership. It can be practiced as the emergence of an individual hero rather than the implementation of a relational process. It has been criticized as elitist and anti-democratic, as if the leader acts alone and apart from the group (Avolio 1999). It has the potential for abuse. It is concerned with changing people, changing values, and moving into new vision. Who determines if the new direction is good and affirming? Who decides if the new vision is a better one? The nature of transformational leadership opens itself to destructive purposes (Howell and Avolio 1992).

The transformational leader needs a foundation of biblical reflection and spiritual formation. The transactions of the church may not require struggling with profound theological issues. This could be debated, but I am convicted with this truth: the transformational leader needs lifelong practices of biblical reflection and spiritual formation. They are needed to protect the church and to guard the soul of the leader.

As a relational process, both the leader and the organization face the potential dangers of the transformational realm. Biblical reflection and spiritual formation protect the leader from the temptation to become the hero, from taking authority that belongs only in Heaven, from moving along the path of self-despair and self-destruction. Biblical reflection and spiritual formation protect the church by moving her from the temptation to trust in human leadership to deep faith in the true Head, from thoughtless emulation of a leader to a thoughtful search of Scripture, from blind commitment to an institutional vision to whole-hearted devotion to God.

With thoughts of such danger abounding, it is understandable why many leaders and organizations retreat to a simple level of transactions: a system of rewards and punishments that serves the self-interest of both the leader and the followers. It is comfortable. But there is a third party left out of the equation, “the kingdom of God and his righteousness” (Matt. 6:31). Transformational leadership is fraught with danger, but if you retreat to a transactional church, you face certain spiritual death. Living at the level of transaction only is like living under a veil. Vision is blurred and glory is faded. The wonder of the Gospel is found in the changing presence of God’s gracious love. The transforming power of God removes the veil, and we “are being transformed (metamorphoo) into his likeness with ever increasing glory, which comes from the Lord, who is the Spirit” (2 Cor. 3:18). Transformational leadership is the high road of adventure; it is life with full vision; it is partnership with the One who was transformed (Matt. 17:2) and who now transforms us.

On the personal implications of transformational leadership.

This is my first publication in the Ashland Journal. Reflecting on my feelings, I am both fearful (Did I meet the standards of my peers?) and excited (Can I go beyond what is expected?). I asked a colleague to review the material. He read the work and read my face. “You have met the bar,” he said. Ah, the standard has been reached. Then he went on, “And, I think you have something important to say.”

He invested the next moments sharpening my thinking, clarifying my logic, and challenging my heart. He then invited me to join him in a conversation concerning his own research. He convinced me I had something to offer. I wanted to do and be my best. That was a small transformational moment. He lifted me from “Is it good enough?” to “You can make a difference.”

From this little incident, notice two emotions: fear and excitement. This is the way I approach new situations. It is the way most people approach change. Fear is the rational mind’s concern with transactional issues. Excitement is the soul’s hope for transformation. For example, when the new pastor arrives, the church is filled with fear and excitement. “I am nervous about the pastor changing things” and at the same time, “I sure hope the pastor helps us change for the better.” New students on the seminary campus are filled with fear and excitement. They fear transactional issues involving grades, degree requirements, and payment schedules. However, they also carry the hope of a transforming experience that will open mind and heart to the presence of God and meaningful ministry in the Kingdom. “I’m concerned I will not be good enough” and “This will be the best experience ever.”

When I face a new assignment, a speaking opportunity, making a new friend, expanding the network of contacts, or leading The Sandberg Leadership Center, I face the marble effect of fear and excitement. There is concern over transactions — the standards, the expectations, the requirements, the passing grade, actions in my best interest. There is also hope in the possibility of transformation — new values, glorious vision, higher ideals, lofty motives, grand possibilities for the greater good.

My own experience goes like this: when the fear is great, the excitement of transformation fades. When the new pastor “changes too many things” (too many patterns of transactions), the hope of “becoming a better church” (transformational vision) slips away in the rubble of gossip and criticism. If the new student is overwhelmed by fear of grades and requirements, the focus on being transformed blurs into a fearful and transactional struggle to make the grade.

When fear is overcome, profound change takes hold. It is the church convinced that the new pastor is more interested in making them better rather than forcing them to be different. It is the new student who sets aside the fear of failure and embraces the possibility of experiencing God in a seminary classroom. People enter the transformational realm, not in the absence of fear, but by overcoming fear. The first and greatest task of leadership is to “be courageous” (Joshua 1:6, 7, 9, 18). I am happy to be creative. I can even be clever on occasion. But, to be courageous is costly.

Transformational leadership requires courage. It is not the courage of risking life and limb like a soldier at Gettysburg or on the shores of Normandy. But it is risking the possibility of disapproval, rejection, misunderstanding, and being featured in the next round of gossip. It is occasionally risking your bread and belonging. Henry Ford II said, “If you are not willing to risk your job, you are probably not doing your job” (Robert Quinn, Executive Education, Seminar #U002013, March 27–31, 2000, University of Michigan). There are times when transformational leadership demands that you put it all on the line. “Be strong and very courageous,” said the Lord to Joshua, and to you (Joshua 1:7).

I find courage in meaningful relationships such as the ones reported at the beginning of these personal reflections. I find courage in developing competency in my task. I find courage is based in a transformational relationship with my Lord. And, I find that courage is what I want to pass on to other leaders.

Change is here, and change is hard. To lead in an era of transformation will call for practical knowledge. To implement transformation will require people skills. But, to make transformation last takes moral courage. You and I need a safe place to discover courage in times of need. This place is nestled between developing personal competence, growing in spiritual depth, and being nurtured in meaningful relationships. This is transformational to a leader.

Works Cited

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• Bass, B. M. 1985. Leadership and performance beyond expectations. New York: Free Press.
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• Bass, B. M., and Avolio, B. J. 1992. Multifactor Leadership Questionnaire - Short form 6S. Binghamton, NY: Center for Leadership Studies.
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Notes

1. The classic definition of the charismatic leader is a special personality characteristic that gives a person superhuman or exceptional powers and is reserved for a few, is of divine origin, and results in the person being treated as a leader (Weber 1947). This emphasis on personality must be brought into balance by recognizing the important role played by followers who validate charisma (Bryman 1992; House 1976). For the most recent revisions of the theory see Conger and Kanungo, 1998.
2. The expressions of followers found in the discussion of each factor are adapted from the leadership instrument MLQ, copyright 1992 by B. M. Bass and B. J. Avolio. For reliability and validity see Bass and Avolio, 1993. Copies of the MLQ can be obtained from Mind Garden, Inc., 1690 Woodside Rd., Suite 202, Redwood City, CA 94061. 650–261-3500. There is an abbreviated version of the MLQ called the MLQ-6S.