Transformational leaders have been posited to impact an organization’s culture, structure,and strategy. These types of leaders manifest themselves as change catalysts who manipulate organizational factors with the aim of improving knowledge cycles. Organizational culture includes the three dimensions: Collaboration, Trust and Learning. Transformational leaders facilitate collaboration by using the idealized influence dimension, which develops relationships in organizations.
As Podsakoff, Mackenzie, Moorman and Fetter (1990) argue, a transformational leader contributes to the cultural aspect of trust, through considering both employees’ individual interests and companies’ essential needs concurrently. Also, transformational leaders identify individual needs of their employees and develop a learning culture by intellectually stimulating them to generate new knowledge and share it with others. Therefore, it is evident that transformational leaders can highly manipulate a firm’s culture (i.e., collaboration, trust and learning) to conform to the needs and expectations of strategic goals and objectives.
These three cultural aspects play a critical role in enhancing the effectiveness of organizational knowledge cycles. Collaboration provides a shared understanding about the current issues and problems among employees, which helps to generate new ideas within organizations (Fahey & Prusak, 1998).
Lines, Selart, Espedal, and Johansen (2005) establish that trust towards their leader’s decisions is a necessary precursor to create new knowledge. Moreover, the amount of time spent learning is positively related with the amount of knowledge gained, shared, and implemented (Choi, 2002, p. 52). Therefore, transformational leaders can reshape, and in some cases, manipulate organizational culture to create a more effective knowledge cycle within departmental and business units of organizations.
Organizational structure can be reshaped by transformational leaders when they apply the intellectual stimulation aspect to develop knowledge sharing and inspire employees to create new ideas for a better environment among business-units and departments. Jarvenpaa and Staples (2000) maintain that the informal structure could facilitate new idea generation to build a more innovative climate within organizations.
(Source: Center for Creative Leadership)
Transformational leaders implement organizational changes to developing better collaboration among subordinates and managers. One can suspect that more emphasis on formalized structures can negatively impact the transformational leader’s ability to exert such changes. Therefore, a more decentralized structure may enable the concept of idealized influence, which can be directed toward improving departmental and managerial interactions. The mechanical or centralization at the commanding level of transformation leadership impairs the opportunity to develop relationships among managers, business units, and departments.
Transformational leaders reshape organizational structures to be more effective when the command center can disseminate information in a decentralized and organic way as opposed to the mechanical and centralized commanding. Decentralized structures shift the power of decision-making to the lower levels and subsequently inspire organizational members to create new ideas and even implement them while centralized structures may negatively impact interdepartmental communications and inhibit knowledge exchange.
Recent research in this area (such as Zheng et al., 2010) affirms that the there is a negative impact of centralization on various knowledge management processes such as knowledge acquiring, creating, and sharing among both managers and departmental units. Ergo, transformational leaders positively contribute to organizational knowledge cycles through building more decentralized structures within organizations.
Bergeron, Raymond and Rivard (2004) found that strategy embraces four aspects:
3) defensiveness, and;
The first aspect, “Analysis,” focuses on identifying the best solutions for the organizational problem. Transformational leaders apply this strategy to enable intellectual stimulations, which creates more innovative solutions for organizational problems.
The second aspect “Futurity” emphasizes the effectiveness of long-term decisions. Transformational leaders employ this kind of strategy to facilitate the effectiveness of idealized influence by developing a vision of adopting more comprehensive information about the future.
The third aspect, “Defensiveness” can also be applied by transformational leaders by taking into account the objectives of strategic implication that seeks to decrease organizational costs and redundancies. While transformational leaders focus on implementing changes, a defensive strategy can be used to modify the current processes to enhance organizational efficiencies.
The fourth aspect, “Futurity” incorporates a pro-active strategy that identifies the coming opportunities in the business, global, and political environment. The aspect can be enhanced by a transformational leader as they adopt a strategic posture that inspires employees to identify better opportunities in both the internal and external environment.
Transformational leaders that employ the four strategic aspects of analysis, defensiveness, futurity, and pro-activeness may enhance goal achievement. For example, On the other hand, an analysis strategy could enhance the knowledge creation process through identifying new opportunities in order to provide better alternatives for managers to make a more effective decision.
Scholars have (such as Cohen & Sproull, 1996) indicated that the analysis strategy is highly associated with a company’s capacity to create new knowledge. In many ways, a proactive strategy could enhance knowledge transfer by developing interactions with both departmental units and the business environment.
When adopting a more futurity type strategy, transformational leaders can enhance the knowledge utilization process, thereby developing guidelines for future pathways and determine future trends in the external environment and allocate their resources accordingly. Therefore, transformational leaders can improve organizational knowledge cycles through embracing the four strategic aspects of analysis, proactiveness, defensiveness, and futurity.
Aspiring managers and future business leaders can conduct an exploratory review of the existing strategic culture and act as change agents that provide a more humanistic and applicable approach to effectively managing knowledge cycles within organizations.
Bergeron, F., Raymond, L. & Rivard, S. (2004). Ideal patterns of strategic alignment and business performance. Information & management, 41(8), 1003-1020.
Choi, B. (2002). Knowledge Management Enablers, Processes, and Organizational Performance: An Integration and Empirical Examination (Doctoral dissertation, Korea Advanced Institute of Science and Technology). Retrieved from http://unpan1.un.org/intradoc/groups/public/documents/apcity/unpan020320.pdf.
Cohen, M. D. & Sproull, L. S. (1996). Organizational Learning. Thousand Oaks, California, Sage Publications.
Fahey, L. & Prusak, L. (1998). The eleven deadliest sins of knowledge management. California Management Review, 40(3), 265-276.
Jarvenpaa, S. L. & Staples, D. S. (2000). The use of collaborative electronic media for information sharing: An exploratory study of determinants. Strategic Information Systems, 9(2), 129-154.
Lines, R., Selart, M., Espedal, B. & Johansen, S. T. (2005). The production of trust during organizational change. Journal of Change Management, 5(2), 221–245.
Podsakoff, P.M., Mackenzie, S.B., Moorman, R.H., & Fetter, R. 1990. Transformational leader behaviors and their effects on followers’ trust in leader, satisfaction, and organizational citizenship behaviors. Leadership Quarterly, 1: 107-142.
Zheng, W., Yang, B. & Mclean, G. N. (2010). Linking organizational culture, structure, strategy, and organizational effectiveness: Mediating role of knowledge management. Journal of Business Research, 63(7), 763-771.