Leadership and Organizational Change

Leadership is an integral element of any society. Within a group of people there is always a person who is able to lead and organize everyone else in order to achieve maximum results. In the modern world that is full of companies and institutions of various sizes and shapes it is impossible to organize efficient working process without a leader. This person is especially important in times of change, when the whole company as well as all individual employees experience times of uncertainty and turbulence. This research focuses on various types of leadership and their influence on change in organization

Executive summary

After the methodology and literature review the research focuses on two primary elements: leadership and organizational change. The main focus is on various types of leadership, the way they’ve evolved throughout history and how they vary in different countries. A special attention is paid to transformational leadership, which is considered to be the main one in times of change. In the final part of the study researcher concludes all the findings and provides recommendations for future studies in the field. 

Research methodology

This study is based on a review of ten articles focused on various topics in the field of organizational change and leadership. All articles are based on research conducted either by the authors themselves, or just on the evaluation of studies conducted by other scientists. The type of methods used vary greatly.

Oreg & Berson (2011) conducted a multilevel analysis of data from 75 Israeli schools, which included their principals (75) and teachers (586). While the principals had to report their demographics, values and attitudes to change, half of the teachers were asked to rate the leadership qualities of their principals, while the other half of teachers reported on other variables. In the process of the study four major variables were measured: personal values, dispositional resistance to change, resistance intensions, and finally – transformational leadership behaviors.

In order to see the role of leader in the psychological state of employees in time of change, Rafferty & Griffin (2006) conducted employee attitude surveys using a 7-point Liker scale with responses that ranged from 1 (which meant “strongly disagree”) to 7 (strongly agree) (p. 1157).

Taormina (2008) used a questionnaire on 166 employees from various organizations. This study was conducted in order to evaluate the companies’ cultures, as well as their leadership styles and leaders themselves. In this questionnaire leadership behavior was measured with a 32-item Competing Values Instrument.

Along with quantitative studies, the researches in the reviewed articles have used qualitative methods, such as case studies. Higgins (2005) presented two cases of the alignment and misalignment of leadership styles and company culture in order to illustrate the importance of correlation of the two.

Review of literature Articles and theories.

Ten articles that were studied in order to comprise this research focus on three main spheres: organizational change, management of organizations, and leadership. Only by understanding the three sides of the issue it is possible to create a more or less concise picture of the role of leadership in the process of organizational change.

Out of all the articles studied for this research only around a half was people-oriented, and only one had a particular focus on the moods and feelings of employees in time of change. At the same time, in order to understand the role of a leader in the process of organizational change more studies should be conducted on the emotional and psychological states of employees in case of different leadership types.

Throughout time various theories on leadership have been developed by philosophers, social scientists and managers. Confuciuslisted four qualities of a leader: love, proper conduct, piety, and the doctrine of mean (Turner & Muller 2005). Much of the modern perceptions of leadership was shaped by Plato, who stated that leadership is “congenial trait” (Taormina 2008, p. 87). Therefore, for quite a while modern researchers treated leadership the same way – as a single trait.

In the 2nd part of the 20th century seven main schools of leadership theory were dominating the scientific world: trait, behavioral, contingency, visionary, emotional intelligence, and competency schools (Turner & Muller 2005).

A major breakthrough in the development of leadership theories was made in the 1950s with the two-dimensional model of leadership, which defined people-oriented and task-oriented models of a leader’s behavior (Taormina 2008). Secondly, there is a distinction between two types of leadership, which dates back to the 1980s, which defines the difference between a leader and a manager. These two types of leadership have various names, with the most common one used in the theory of change management being transactional (manager) and transformational (leader) types of leadership.   

Change management and Leadership

Change is inevitable and plentiful in organizations both in the private and public sectors. At the same time, it is very hard to predict and control change due to a vast variety of variables that are altered simultaneously (Burke & Litwin 1992). Therefore, despite a constant need for innovations and adjustments to the new requirements of the environment, not all the changes happening in organizations are successful (Oreg & Berson 2011). There are various reasons that lead to change in organizations. For example, according to Burke & Litwin (1992), all changes in organizations are initiated by external forces and influences. The environments in which organizations exist constantly change which makes the structures adapt to the restyled conditions.

Currently there is a number of models of organizational performance and change: Causal model, 7S, 8S models, etc. the 7S model, which was developed in early 1980s by Pascale and Athos, describes organizational variables of significant importance, and notes the importance of interconnection of the variables. The 7S variables are “strategy, structure, systems, style, staff, skills, and shared values” (Burke & Litwin 1992, p. 524).  The 8S model differs from the original 7S model in two main ways: firstly, skills were replaced with resources; secondly, another ‘S’ was added – strategic performance (Higgins 2005)

The causal model makes a clear distinction between leadership and management, which will be further explored in this study. According to this model, there are five primary elements that influence organizational climate: organization’s mission, structure, managerial practice under the influence of organizational culture, fairness of rewards, and finally – focus on customer pressures that should be more important than the internal ones. 

Leadership in Change

Leadership is a universal phenomenon, which can be seen in any country of the world and in any society (Bass 1997). While having almost ultimate authority, leaders are able to deside the course of the development of their organization. It is possible to provide numerous definitions of leadership in an organization. Burke & Litwin (1992), for example, define it as the ability of an organization executive to provide “overall organizational direction and serve as behavioral role model for employees. Depending on the size of an organization, the number of leaders and levels of superiority vary dramatically from senior CEOs to low-level managers. Although in the process of change the influence of the senior group of leaders is much more significant than the one of managers, all leadership levels should be taken into consideration.

The role of leader is extremely important in an organization that is going through a change.  On one hand, a leader should be able to stimulate and coordinate the whole team, and on the other s/he has to be able to adequately react onto the changes happening within the organization (Burke & Litwin 1992). Therefore, the nature of leadership in organizations is twofold, because a person should lead the organization while at the same time being responsive to all its’ needs and changes.

The decisions made by a leader in organization are usually shaped by his beliefs and personal attributes. Therefore, for the unified decisions within the organization should have clearly-shaped set of common beliefs bout “what they pay attention to, control, and reward” (Oreg & Berson 2011, p. 630).

All the actions and choices made by a leader shape not only his/her own course and the course of the organization, but they also influence the beliefs and attitudes of the followers. Therefore, the organization culture created by the leadership can either stimulate the change or, on the contrary, make it less attractive for the members of the group. Oreg & Berson (2011)  provide an example of individuals, who value stability and thus will see the change as threat, while the organization, in which renewal is one of the core values, will interpret the change as a new possibility and thus will appreciate and support it.

At the same time, while the organization is influenced by a leader, the leadership styles are influenced by the organizations as well. According to Bass (1997), leadership is affected by the culture of the organization in which it occurs. Higgins (2005) notes that it is essential to align leadership style with the company’s culture. Otherwise it will be much complicated to go through the change and successfully execute the company’s strategy. 

In times of change the role of leader is also a supportive one because his influences are reflected on the way in which the team members perceive change. Supportive leadership, therefore, influences on all the perceptions of individuals in the process of change. Rafferty & Griffin (2006) suggest that it is essential to ensure that leaders not only understand but also manage to provide employees with support corresponding to their individual needs in times of change. Research conducted by these two authors show that employees who had supportive leaders reported that they’ve experienced more planned and organized changes and less unexpected events. Therefore, employees with proper leadership in times of change reported less psychological stress an uncertainty than those without supportive leadership.

Transactional and Transformational leadership

The two types of leadership that are important in the process of organizational change are transformational and transactional leaderships. Some studies show that the two types of leadership are complementary, while others state that transactional leadership is essential in the process of maintaining an organization and transactional should be more popular in times of change (Leithwood & Poplin1992). The main difference between the two types of leadership is that while transactional leader reinforces his or her followers, transformational one stimulates them to go beyond one’s boundaries and self-interests for the common interest of the group (Bass 1997). While transactional leader works within the limitations of an organization, transformational one changes the organization (Bass 1997).

Transactional system is based on an exchange of services for rewards, and thus help people realize what has to be done and might even increase the motivation and confidence of the members of organization. Transformational leadership, also sometimes referred to as charismatic, is especially effective in times of change (Herold et. al. 2008). The main aim of transformational leadership is to stimulate people to improve their practices. Leithwood & Poplin(1992) cites the definition proposed some years earlier by Roberts: “transforming leadership is a leadership that facilitates the redefinition of a people’s mission and vision, a renewal of their commitment, and restructuring of their systems for goal accomplishments” (p. 9). According to Arnold et. al. (2007) transformational leadership has four dimensions: “idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration” (p. 193).

Transformational leadership can be sometimes mixed with change leadership, but these are two different notions. If change leadership has a primary focus on the current state and the ways in which a leader is coping with this change, transformational one works wtith change on a long-term basis. It involves the relationships between a leader and his or her followers that is based on numerous interactions and long-term strategies (Herold et. al. 2008).

It is essential to remember that although transactional/transformational paradigm is very popular in the United States, cross-cultural differences play a very important role in the perception of these two types of leadership. This might be an essential point as the majority of all the theories and methods of this paradigm were created in the United States (Bass 1997). The peculiar characteristic of the USA is its’ individualistic culture, thus this paradigm might not be true for the collectivistic states. The research of Bass (1997) shows that in collectivistic countries of East Asia transformational leadership in fact evolves much rapidly than in the USA. 

In the study of leadership in the process of change it should be noted that all the data parameters significantly vary in different countries and cultures. Overall scientists emphasize the differences of organizational management and leadership in different countries, which are more important and obvious than the similarities. Even in states with very similar cultures, such as the United States of America and Great Britain, some attitudes and perceptions differ. Burke & Litwin (1992) state that beliefs about “the team” and the nature of satisfaction are different in the two countries: while the Brits usually criticize culture and other more distant factors, the US citizens tend to focus on the flaws of their teammates.   

Conclusion

This study has presented a short review of managerial structures, as well as in-depth analysis of leadership in times of change, with a special focus on two types of leadership – transformational and transactional. The main aim of this research was to show the significant role of a leader in the process of organizational management in times of change.

The author has tried to show the significant place of a leader by showing the way in which a leader is connected to employees by not only managing them, but also setting an example of culture and behavior. Secondly, a leader in an organization should stay closely connected to the organizational culture because only by complying with the general cultural norms and values of the organization one will be able to manage it effectively.

In times of change the role of a leader is even more significant because it is a period of huge responsibility and significant uncertainty. This is the time when transformational leadership, which makes people go behind their limits, is essential. A transformational leader not only stimulates team members, but in fact also reshapes the organization. Therefore, this type of leadership is essential in the process of change.

Recommendations

The study of the role of leadership in the process of change requires a deep approach and solid professional knowledge in the following spheres: management of organizations; change management; leadership types; group dynamics, and even psychology. Therefore, all further studies require specialists in all the mentioned spheres. Only in this case it will be possible to achieve significant results and see the overall picture of the role of leadership in times of change.

The reviewed literature shows that currently all the studies lack people-oriented approach towards employees and group members. Therefore, for the future studies of leadership in organizations in times of change additional attention should be paid to the perceptions, moods, and psychological conditions of employees.

In terms of leadership qualities in times of change, the most important ones are unified under the general definition of a transformational leader. This type of leader not only supports employees and stimulates them, but also empathizes, which provides emotional support to employees and thus makes the process of change smooth and more comfortable. Moreover, the type of organizational culture, which is established by a leader, has a great influence on the employees’ perception of change.

References:

  • Arnold KA, Turner N, Barling J, Kelloway KE, & McKee MC 2007, ‘Transformational leadership and psychological well-being: the mediating role of meaningful work.’, Journal of Occupational Health Psychology, 12 (3), pp. 193-203.
  • Bass, BM 1997, ‘Does the Transactional-Transformational Leadership Paradigm Transcend Organizational and National Boundaries?’, American Psychologist, 52 (2), pp. 130-139.
  • Burke, WW & Litwin, GH 1992, 'A Causal Model of Organizational Performance and Change', Journal of Change Management, 18(3), pp.523-45.
  • Herold DM, Fedor DB, Caldwell S & Liu Y 2008, ‘The effects of transformational and change leadership on employees’ commitment to a change: a multilevel study.’, Journal of Applied Psychology, 93 (2), pp. 346-357.
  • Higgins JM 2005, ‘The Eights ‘S’s of successful strategy execution.’, Journal of Change Management, 5 (1), pp. 3-13.
  • Leithwood KA and Poplin MS 1992, The move toward transformational leadership. Educational Leadership, 49(5), pp. 8-12.
  • Oreg S and Berson Y 2011, ‘Leadership and employees’ reactions to change: the role of leaders’ personal attributes and transformational leadership style.’, Personnel Psychology, 64, pp. 627-659.
  • Rafferty AE and Griffin MA 2006, ‘Perceptions of organizational change: a stress and coping perspective.’, Journal of Applied Psychology, 91 (5), 1154-1162.
  • Taormina, RJ 2007, ‘Interrelating leadership behaviors, organizational socialization, and organizational culture.’, Leadership & Organization Development Journal, 29 (1), pp. 85-102.
  • Turner JR and Muller R 2005, ‘The project manager’s leadership style as a success factor on projects: a literature review.’, Project Management Journal, 36 (1), pp. 49-61.

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