A New Paradigm of Leadership

Bass Book 1 2/28/96 6:16 PM Page i
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A NEW PARADIGM OF LEADERSHIP:
An Inquiry Into
Transformational Leadership
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Bernard M. Bass
"L'*'U Ä'XlEHBff'
9960408 084
U.S. Army Research Institute for the
Behavioral and Social Sciences
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Bass Book 1 2/26/96 10:54 PM Page ii
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February 1996
U.S. Army Research Institute for

the Behavioral and Social Sciences
Alexandria, Virginia
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A New Paradigm for Leadership PE 0601102A
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Bernard Bass (State University of New York, Biqghamton) Contract No. DASW01-94-M-9995
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Bernard Bass, PhD.
2135 West Hamton Road
Binghamton, NY 13903-3116
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13. ABSTRACT (Maximum 200 words):

The preponderance of research on leadership stems from either of the two dominant models of leadership. The transactional
model and the transformational model have provided the backbone for a theoretical understanding of leadership. This report
views both of these models through a factor analytic framework. It also provides answers to a series of fundamental
questions concerning what we know about leadership, what we do not know, and identifies areas for further research.
14. SUBJECT TERMS 15. NUMBER OF PAGES

transformational model of leadership transactional model of leadership performance
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Bass Book 1 2/26/96 2:52 PM Page iii
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Contents
Page
Acknowledgments .vii
Foreword .xi
Executive Summary jciii
1. Introduction 1
The New Models of Leadership 2
Empirical Support 9
Further Assumptions and Propositions 11
2. Commitment, Involvement, Loyalty and Performance 17
The Dynamics of Transformational
Leadership and Commitment 22
3. Stress and Transactional/Transformational Leadership 29
Successful But Not Necessarily
A\ Effective Leadership in Stress Situations 37 As
Stress and Effectiveness as a Leader 39
4. Contingencies of Transformational
and Transactional Leadership 53
Situations Can Make Some Difference 54
Leadership Contingent or One Best Way? 67
5. Transformational and Transactional
Organizational Culture 69
Model Transactional and Transformational Cultures 72
Relations of Organizational Culture to
Quality Improvement 79
A Barometer of Transformational/Transactional
Leadership Training 80
6. Transformational and Transactional
Leadership of Men and Women 81
Evidence of Differences in Transformational Leadership 82
Some Possible Explanations 88
7. Implications of Transformational Leadership
for Organizational Policies 91
iii
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iv A New Paradigm of Leadership
8. Development and Training in

Transformational Leadership 105
Development of Transformational Leadership 105
Counseling, Training and Education 112
Counseling and Guidance 113
Training in Transformational
Some New Directions 130
9. Prediction of Transformational
Individual Traits as Predictors of MLQ Scale Scores 137
10. Rank, Status and Transformational/
Transactional Leadership 145
Election Versus Appointment 145
Organizational Level and Transformational/
^ 11. Empowerment and Laissez-Faire Leadership 157 j^
The Empowering Leader 165
Laissez-Faire Leadership 169
12. Substitutes for Transformational and
Suggested Substitutes for Transformational
13. Conclusions 185
Measurement of Transformational Leadership
Related Concepts and Measures 192
Other Prospective Research and Development Issues 194
14. References 201
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Contents
LIST OF FIGURES
Figure 1. Optimal Profile 8

Figure 2. Suboptimal Profile 9
Figure 3. Frequency and Percentage of Types of Cultures
According to the Organizational Description
Questionnaire (ODQ) Scores for Leaders
of Organizations 74
Figure 4. Mean Differences Among Men and Women
Managers in MLQ Scores When Rated by
Subordinates (Study 1) 85
Figure 5. Mean Differences in MLQ Scores Among
Men and Women Managers When Rated
by Subordinates (Study 2) 86
Figure 6. Standardized Change in Leadership Styles
According to Self-Ratings From Before
to After Training of the Leaders in the
Full Range of Leadership Program (N = 87) 125
Figure 7. Standardized Change in Leadership Styles
<> According to 3-5 Subordinate Raters From
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Before to After Training of Their Leaders in the
Full Range of Leadership Program (N = 87) 126
LIST OF TABLES
Table 1. Descriptions of Participative Versus

Directive Leadership and the Components
of the Full Range of Leadership 12
Table 2. First-Order Correlations of Transactional
and Transformational Leadership of Superiors
and the Felt Stress and Burnout Among
Their Subordinates 49
Table 3. The Likelihood of Exchange and Charismatic
Leadership Emergence Under Different
Environmental and Organizational Conditions 55
Table 4. Task/Goal Subordinate and Leader Conditions
Fostering the Emergence of the Full Range
of Leadership 56
Table 5. Effects of Stable and Unstable
Environments on Scores 58
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VI A New Paradigm of Leadership
Table 6. Significant Military-Civilian Differences

in Outcomes Correlated With MLQ Factor Scores 63
Table 7. Relations Between Transformational and
Transactional Organizational Culture and
Quality Improvement According to 130
Community Leaders and Their 877 Subordinates 80
Table 8. MLQ Rate-Rerate Correlations 134
Table 9. Correlations Between MLQ Behaviors
and Sociometric Index of Esteem 136
Table 10. Correlations Between Subordinates'
Ratings of Junior Officers and Superiors'
Fitness Reports 137
Table 11. Power Related to Transformational/
Table 12. Ranks of Naval Officers Related to
Their Subordinates 151
Table 13. First-Level and Second-Level
New Zealand Supervisors and
Managers Compared (N = 56) 153
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Table 14. Comparison of Managers and Senior
Executives in 14 Japanese Firms 154
Table 15. Mean MLQ Scores for Upper
Level and Lower Level Leaders 155
Table 16. Relation of Level in the Organization
and the Perceived Promotion and
Implementation of High Involvement 162
Table 17. Barriers to Empowerment Due to
Senior Management 163
Table 18. Follower Reactions to Empowering
Leadership Behavior 166
Table 19. Substitutes and Other Potential
Moderators of Leader Behavior 175
Table 20. Revised Substitutes for Leadership Scale 176
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Acknowledgments
I wish to acknowledge that this review was prepared

primarily with data for the figures and tables drawn from other
published and unpublished reports. They should not be quoted
directly as from this report but rather from the acknowledged
original sources as indicated below:
Figure 1: From Bass, B.M., & Avolio, B.J. (1994). Improving
organizational effectiveness through transformational leadership.
Thousand Oaks, CA: Sage.
Figure 2: From Bass, B.M., & Avolio, B.M. (1994). Improving
organizational effectiveness through transformational leadership.
Figure 3: From Avolio, B.J., & Bass, B.M. (1994). Evaluate
the impact of transformational leadership training at individ-
ual, group, organizational, and community levels. Final report
-0- to the W.K. Kellogg Foundation, Binghamton University, (t)
Binghamton, NY.
Figure 4: From Bass, B.M., & Avolio, B.J. (in press). Shatter
the glass ceiling: Women may make better managers. Human
Resource Management Journal.
Figure 5: Data from Bass, B.M., Avolio, B.J., & Atwater, L.
(in press). The transformational and transactional leadership of
men and women. International Review of Applied Psychology.
Figure 6: From Avolio, B.J., & Bass, B.M. (1994). Evaluate the
impact of transformational leadership training at individual, group,
organizational, and community levels. Final report to the W.K.
Kellogg Foundation, Binghamton University, Binghamton, NY.
Figure 7: From Avolio, B.J., & Bass, B.M. (1994). Evaluate
the impact of transformational leadership training at individ-
ual, group, organizational, and community levels. Final report
to the W.K. Kellogg Foundation, Binghamton University,
Binghamton, NY.
Table 1: From Avolio, B.J., & Bass, B.M. (1991). The full
range of leadership development: Basic and advanced manuals.
Binghamton, NY: Bass, Avolio, & Associates.
vu
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viii A New Paradigm of Leadership
Table 2: Adapted from Seltzer, I., Numerof, R.E., & Bass, B.M.
(1989). Transformational leadership: Is it a source of more or less
burnout or stress? Journal of Health and Human Resources
Administration, 12,174-185.
Table 3: Adapted from Howell, J.M. (in press). Organization
contexts, charismatic and exchange leadership. In H.L. Tosi
(Ed.), The environment/organization/person contingency model:
A meso approach to the study of organization. Greenwich, CT:
JAI Press.
Table 4: Original for this report.
Table 5: Adapted from House, R.J. (1995). Leadership in the
twenty-first century: A speculative inquiry. In A. Howard (Ed.),
The changing nature of work. San Francisco: Jossey-Bass.
Table 6: Adapted from Lowe, K., Kroek, K.G., & Sivasubra-
manian, N. (1994). Effectiveness correlates of transformational
and transactional leadership: A meta-analytic review. Depart-
ment of Management and International Business, Florida Interna-
tional University, Miami, FL.
~^J Table 7: Data drawn from Avolio, B.J., & Bass, B.M. (1994). ~£^~
Evaluate the impact of transformational leadership training at
individual, group, organizational, and community levels. Final
report to the W.K. Kellogg Foundation, Binghamton University,
Binghamton, NY.
Table 8: Data from Pile, S. (1988). Visionary leadership:
Creating a generative internal map. Master's thesis, Pepperdine
University, Los Angeles, CA.
Table 9: Adapted from Atwater, L., Lau, A., Bass, B.M.,
Avolio, B.J., et al. (1994). The content, construct and criterion-
related validity of leader behavior measures (ARI Research Note
95-01). Alexandria, VA: U.S. Army Research Institute for the
Behavioral and Social Sciences.
Table 10: Adapted from Yammarino, F.J., & Bass, B.M.
(1990a). Long-term forecasting of transformational leadership and
its effects among Naval officers: Some preliminary findings.
In K.E. Clark & M.R. Clark (Eds.), Measures of leadership
(pp. 151-169). Greensboro, NC: Center for Creative Leadership;
West Orange, NY: Leadership Library of America.
Table 11: Adapted from Atwater, L. (unpublished).
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Bass Book 1 2/28/96 6:29 PM Page ix
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Acknowledgements ix
Table 12: Adapted from Yammarino, F.J., & Bass, B.M.

(1990a); Deluga, R.J. (1990). The effects of transformational,
transactional, and laissez-faire leadership characteristics on
subordinate influencing behavior. Basic and Applied Social
Psychology, 11,191-203; and Deluga, R.J. (1991). The relationship
of leader and subordinate influencing activity in Naval environ-
ments. Military Psychology, 3, 25-39.
Table 13: Adapted from Bass, B.M., Waldman, D.A., Avolio,
B.J., & Bebb, M. (1987). Transformational leadership and the
falling dominoes effect. Group & Organization Studies, 12, 73-87.
Table 14: Adapted from Yokochi, N. (1989). Leadership
styles of Japanese business executives and managers: Transfor-
mational and transactional. Doctoral dissertation, United States
International University, San Diego, CA.
Table 15: Adapted from Lowe, K., Kroek, K.G., & Sivasubra-
manian, N. (1994). Effectiveness correlates of transformational
and transactional leadership: A meta-analytic review. Depart-
ment of Management and International Business, Florida Interna-
^ tional University, Miami, FL. ,
^ Table 16: Adapted from Howard, A., & Wellins, H. (1994). "^
High-involvement leadership: Changing roles for changing times.
Leadership Research Institute, Development Dimensions Interna-
tional. Greenwich, CT: JAI Press.
Table 17: Adapted from Howard, A., & Wellins, H. (1994).
High-involvement leadership: Changing roles for changing times.
Leadership Research Institute, Development Dimensions Interna-
tional. Greenwich, CT: JAI Press.
Table 18: After Seltzer, ]., & Miller, L.E. (1990). Leader
behavior and subordinate empowerment in a human service
organization. Paper, Academy of Management, San Francisco, CA.
Table 19: After Howell, J.P., Bowen, D.E., et al. (1993).
New dimensions in leadership. A special report from Organiza-
tional Dynamics (pp. 83-99). American Management Association,
New York, NY.
Table 20: From Podsakoff, P.M., MacKenzie, S.B., & Felter,
R.C. (1993). Substitutes for leadership and the management of
professionals. Leadership Quarterly, 4,1-44.
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Bass Book 1 2/26/96 11:20 PM Page xi
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Foreword
Research and development to strengthen the foundation of
knowledge for leadership selection and development is one of
the primary program areas of the U.S. Army Research Institute
for the Behavioral and Social Sciences (ARI). Leadership theory
is a crucial component of the necessary foundation of knowl-
edge, helping to shape the applied research efforts and the
Army's strategies and policies for effective leader development.
The research reported in this volume presents the culmination of a
long-standing effort by Dr. B. M. Bass, a creative scientist partially
funded by the Research and Advanced Concepts Office (RACO)
of ARI. Our purpose in presenting this research synthesis is to
develop a theory of leadership that is relevant to today's Army, and
can guide our best efforts to create the leaders of tomorrow.
Units perform well if leaders motivate their troops and instill a
sense of cohesion. The difference between winning and losing bat-
tles is often the extra effort inspired by exceptional leadership.
Empirical research described in this volume supports the finding
that the best of both military and civilian leaders often display a
^K particular kind of leadership, transformational leadership. The ^K
~W~ contribution of transformational leadership to unit commitment, M^~
involvement, loyalty, and performance helps units to cope with
stress in crises, emergencies and the "fog of war." The implications
of the new research on transformational leadership for the organi-
zation's image and strategic planning, and its impact on recruiting,
selection, promotion, personnel development, and management
education are all discussed.
We are pleased to make Dr. Bass' significant scientific contri-
bution available on the occasion of a symposium on Leadership
Challenges of the 21st Century Army. We hope and expect that this
volume will help to invigorate all aspects of the symposium, and
further its goals: to convene, to think and discuss, and then to
examine leadership policy and leader development with the great-
est possible degree of sophistication and commitment.
We hope that the new ideas in this research will provide new
insights and approaches to all members of the Army's leader devel-
opment community and to the scientists who will pick up the chal-
lenge to begin a dialog to arrive at better methods for developing
effective leaders in an age of continuing change and information
explosion.
EDGAR M. JOHNSON
Director
xi
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Executive Summary
Requirement
Leadership theory, research, education, and development
concentrated on leadership as a transactional exchange between
leader and followers until the last 15 years. Then, a new para-
digm of transformational/transactional leadership was introduced
which better reflected the practices of the best of leaders. Eleven
questions about the new paradigm are posed which have implica-
tions for military applications. This report employs recently pub-
lished as well as much of as yet unpublished literature to provide
tentative answers to each of the questions.
Findings
Section 1 describes the model of the full range of leadership
which it is posited most leaders display. Empirical research using
.^ survey methods supports the finding that the best of both military ^
~t-3~ and civilian leaders display more transformational leadership vT"
and less passive managing-by-exception. Answers to each of the
eleven questions are examined in detail in the sections that follow.
Section 2 looks at the contribution of transformational
leadership to follower commitment, involvement, loyalty, and
perceived follower performance. The dynamics involved explain
why transformational leadership contributes positively to the
subjective feelings and performance of followers.
Section 3 details how transformational leadership helps
followers to cope with stress in crises, emergencies and various
other stressful conditions such as panic and disasters. Transac-
tional leadership may also be successful in guiding followers but
it is less likely to be effective. Pseudotransformational leaders
may be the source of the stress.
Section 4 asks whether contingencies value a difference in
the emergence and effectiveness of transformational leadership.
Some variation is expected and obtained in transformational and
transactional leadership as a function of the stability or turbu-
lence in the environment, the individualism or collectivism of the
cultures, the mechanistic or organic character of the organization,
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xiv A New Paradigm of Leadership
in military compared to civilian operations, in homogeneous

compared to heterogeneous groups, in work groups compared
to study groups, and in research groups compared to develop-
ment teams.
Section 5 considers organizational cultures to be describable
in terms of their transformational and transactional qualities.
Transformational cultures are more adaptive; transactional
cultures are more unadaptive. When organizations are typed, a
plurality are found to be coasting; that is, they tend to moderately
exhibit signs, symbols, customs, and norms of both transactional
and transformational leadership.
Section 6 reviews what has been found about the transforma-
tional and transactional leadership of men and women. Women
leaders tend to be somewhat more transformational and effective;
men manage more by exception. Explanations are offered for
these findings.
Section 7 suggests the implications of the new paradigm on
its cascading effects. Also considered are the implications for the
^ organization's image and strategic planning. Then the impact .
vT- on recruiting, selection, promotion, personnel development, and T7
management education are discussed. Finally, Section 7 exam-
ines how the new paradigm is likely to contribute to a better
understanding of job design, decision-making, and diversity.
Section 8 addresses the issues of the development of trans-
formational leaders as assessed from biodata, as modified through
counseling and feedback, and as generated from formal training
programs. Evaluations of successful training efforts are provided.
Section 9 examines the ways that global attributes, specific
traits, and combinations of assessments have been applied to
validate forecasts of retrospective, concurrent, and subsequently
measured transformational leadership. Promising predictors
are suggested.
Section 10 reviews what is known about whether election or
appointment makes a difference, and the unexpected minimal
effects of rank on transformational leader behavior. Both the
military and civilian sectors are examined. Summaries of meta-
analyses are provided.
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Executive Summary xv
Section 11 discusses the differences between empowerment

and laissez-faire leadership. Findings are illustrated by military
examples and by the results of a factor analysis of survey
feedback data.
Section 12 considers whether or not there could be valid
substitutes for transformational and transactional leadership and
proposes some possibilities.
Section 13 concludes with suggestions for needed research
on the new paradigm and argues, in particular, for the develop-
ment and evaluation of more theory and explanations of the
empirical work already available. Many gaps in our knowledge
still remain requiring additional basic research. Additionally,
needed are large-scale military studies on leadership performance
and training to confirm the utility of the new approach.
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SECTION 1
Introduction
The Changing Army

In World War II the commitment, loyalty and involvement of
privates to generals in the Army was reinforced by a belief that
they were engaged in a just cause with the clear purpose to
achieve total victory. Beginning with the Korean "police action,"
the cause changed from repelling aggression to containing Sino-
Soviet expansion to maintaining a stalemate. Vietnam was even
more murky; survival for a year until being rotated out became
paramount. In the 1990's the Army has found itself in separate
actions in Panama, Grenada, Iraq, Somalia and now Haiti. It must
T7" be ready to project and represent the power of the world's only -(;)-
remaining superpower.
A second change is that the Army is now composed of volun-
teer professionals. Its minimum educational and intelligence
standards for enlistment have been raised and the search and
application of ever-improving new technologies continues
unabated. Additionally, the force has become highly diverse in
race and sex. Finally, the American society from which the
Army's personnel are drawn has seen the rise of moral relativism
and the increased questioning of the values of honor, duty and
country. Elvis Presley and O.J. Simpson have become more cele-
brated than George Washington and Abraham Lincoln.
Instead of preparing and marching off into harm's way to
totally defeat the enemy in as short a time as possible, with the
least casualties, Army service becomes a career itself, or a step-
ping stone to a civilian career. One of the ways to achieve the
needed alignment of individual soldier interests with the inter-
ests of his or her unit, organization and the Army as a whole is
through leadership at all levels. And while commitment and
involvement of these better educated, more intelligent, more fully
trained, diverse, technologically "tuned-in," personnel more
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A New Paradigm of Leadership
skeptical about the ideals of just causes and patriotic duty may
be maintained to some degree by the "carrot-or-stick" contingent
reinforcement of transactional leadership, it is argued here that
much more will be achieved if transformational leadership is
added to the leadership.
THE NEW MODELS OF LEADERSHIP
A new paradigm of leadership has begun to capture atten-

tion. Leadership is conceived to be transactional and/or transfor-
mational (Burns, 1978; Bass, 1985). Evidence has accumulated
that transformational leadership can move followers to exceed
expected performance. It is seen as a particularly powerful source
of effective leadership in Army, Navy and Air Force settings (e.g.,
Bass, 1985; Boyd, 1988; Curphy, 1992; Longshore, 1988; O'Keefe,
1989; and Yammarino & Bass, 1990), a fact which was implicitly
recognized by many in the military long before the paradigm was
codified. But what the codification did was to permit systematic
exploration of the phenomenon of transformational leadership
(f) and the effects of its application to specific conditions. Further- A\
^ more, it led to a whole new mode of leadership training (Avolio & ^
Bass, 1991). Again, it should result in new ways of identifying
more successful and effective leaders.
Empirical Research
Since the early 1980's, empirical research both inside and
outside the Army, Navy, Air Force and Marine Corps has sup-
ported the greater effectiveness of transformational leadership in
contrast to transactional leadership in generating subordinate
extra effort, commitment, satisfaction and contribution to military
readiness. Understanding of what was involved remains spotty
for several reasons. While considerable completed research has
used standardized instruments, often these particular studies
have shortened or eliminated scales for pragmatic reasons. Few
controlled experiments have been attempted. Most conclusions
have had to rely on survey research. Fortunately, most of this has
been in the field. Numerous studies repeatedly test the same few
hypotheses. There is a paucity of theory. This report will review
eleven issues about transformational leadership with special
attention to its implications for the Army and the motivation of
its personnel.
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Introduction
This report will use an empirically and logically supported

factor analytic framework of transactional and transformational
leadership. The model portrays transactional leadership as contin-
gent reinforcement. The reinforcement is in the form of promises
and rewards or threats and disciplinary actions. Transformational
leadership is conceived as charismatic in attribution or behavior,
intellectually stimulating, or individually considerate.
The Questions To Be Addressed

A series of fundamental propositions will be presented to
deal with a variety of basic questions whose answers will further
leadership research and application. Such questions will include:
1. What are the "mechanisms" that lead to greater commit-
ment, involvement, loyalty and performance as a consequence of
transformational leadership?
2. Why is stress among followers greater under transac-
tional leadership?
3. How much do situational contingencies affect the use and
-Q- effectiveness of transactional and transformational leadership? _£X_
How much do combat and crises make a difference?
4. Can organizational cultures usefully be described in terms
of how transactional or transformational they are?
5. Are there gender differences in transformational and
transactional leadership?
6. What are the implications of transformational leadership
for organizational policy?
7. How and what about transformational leadership can be
effectively taught and learned?
8. Can the tendency to be more transformational be accu-
rately predicted? If so, how?
9. How do rank and status affect the tendency and need to be
more transformational?
10. How is empowerment differentiated from laissez-faire
leadership?
11. Are there substitutes of consequence for transformational
leadership?
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Background
Historians, political scientists and sociologists had long since
recognized leadership that went beyond contingent reinforce-
ment. Weber's (1924/1947) examination of charisma epitomized
such study. However, both psychology and economics were
enamored of contingent reinforcement as the underlying concept
for the study of leadership. Leadership was an exchange relation-
ship for them. Research exemplified by Podsakoff and Schri-
escheim (1985), as well as much of the research with the Full
Range of Leadership model (Avolio & Bass, 1991) to be described
subsequently, indicates that contingent reward is reasonably
effective under most circumstances, active contingent discipline
(corrective leadership for failure of a follower to comply) more
varied in effects, and passive contingent discipline (don't fix it if
it ain't broken) is contraindicated as an effective act of leadership.
For as Harry Levinson (1980) suggested, if you limit leadership of
a follower to rewards with carrots for compliance or punishment
with a stick for failure to comply with agreed-upon work to be
done by the follower, the follower will continue to feel like a jack-
ass. Leadership must also address the follower's sense of self- ,
v7~ worth in order to engage the follower in true commitment and -()-
involvement in the effort at hand. And that is what transfor-
mational leadership adds to the transactional exchange. Shamir
(1991) has developed a theory to explain this effect.
Transformational leaders motivate others to do more than
they originally intended and often even more than they thought
possible. They set more challenging expectations and typically
achieve higher performances.
Transformational leadership is an expansion of transactional
leadership. Transactional leadership emphasizes the transaction
or exchange that takes place among leaders, colleagues, and
followers. This exchange is based on the leader discussing with
others what is required and specifying the conditions and rewards
these others will receive if they fulfill those requirements.
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Introduction
Components of Transformational Leadership

Transformational leaders do more with colleagues and fol-
lowers than set up simple exchanges or agreements. They behave
in ways to achieve superior results by employing one or more of
the four components of transformational leadership.
Factor studies from Bass (1985) to Avolio and Howell (1992)
have identified the four components of transformational leader-
ship. Leadership is charismatic such that the follower seeks to
identify with the leader and emulate him or her. The leadership
inspires the follower with challenge and persuasion, providing a
meaning and understanding. The leadership is intellectually
stimulating, expanding the follower's use of his or her abilities.
Finally, the leadership is individually considerate, providing the
follower with support, mentoring and coaching. Each of these
components can be measured with the Multifactor Leadership
Questionnaire (MLQ).
Descriptions of the components are shown below along with
coefficient alphas (in parenthesis obtained for 1,053 raters, all
belonging to the same firm, who described their leaders using the
~^y 70 item Multifactor Leadership Questionnaire (Form 5)). ~C}"
1. Charismatic leadership or idealized influence. Transfor-
mational leaders behave in ways that result in their being role
models for their followers. The leaders are admired, respected,
and trusted. Followers identify with the leaders and want to
emulate them. Among the things the leader does to earn this
credit is considering the needs of others over his or her own
personal needs. The leader shares risks with followers and is
consistent rather than arbitrary. He or she can be counted on to
do the right thing, demonstrating high standards of ethical and
moral conduct. He or she avoids using power for personal gain
and only when needed. (.89)
2. Inspirational motivation. Transformational leaders behave
in ways that motivate and inspire those around them by provi-
ding meaning and challenge to their followers' work. Team spirit
is aroused. Enthusiasm and optimism are displayed. The leader
gets followers involved in envisioning attractive future states. The
leader creates clearly communicated expectations that followers
want to meet and also demonstrates commitment to goals and the
shared vision. (.76)
^>
-e-
3. Intellectual stimulation. Transformational leaders stimu-

late their followers' efforts to be innovative and creative by ques-
tioning assumptions, refraining problems, and approaching old
situations in new ways. Creativity is encouraged. There is no
public criticism of individual members' mistakes. New ideas and
creative problem solutions are solicited from followers, who are
included in the process of addressing problems and finding solu-
tions. Followers are encouraged to try new approaches, and their
ideas are not criticized because they differ from the leaders' ideas.
(.86)
4. Individualized consideration. Transformational leaders
pay special attention to each individual's needs for achievement
and growth by acting as coach or mentor. Followers and colleagues
are developed to successively higher levels of potential. Individu-
alized consideration is practiced as follows: New learning oppor-
tunities are created along with a supportive climate. Individual
differences in terms of needs and desires are recognized. The
leader's behavior demonstrates acceptance of individual differ-
ences (e.g., some employees receive more encouragement, some
more autonomy, others firmer standards, and still others more task
~K.7~ structure). A two-way exchange in communication is encouraged, T7
and "management by walking around" work spaces is practiced.
Interactions with followers are personalized (e.g., the leader
remembers previous conversations, is aware of individual con-
cerns, and sees the individual as a whole person rather than as just
an employee). The individually considerate leader listens effec-
tively. The leader delegates tasks as a means of developing follow-
ers. Delegated tasks are monitored to see if the followers need
additional direction or support and to assess progress; ideally,
followers do not feel they are being checked on. (.89)
Several thousand leaders in the private sector and commu-
nity leaders in the public sector have been trained using the
model of the full range of leadership. This model includes the
four components of transformational leadership as well as trans-
actional leadership behavior and laissez-faire or nonleadership
behavior.
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^>
Introduction
Components of Transactional Leadership

Transactional leadership occurs when the leader rewards or
disciplines the follower depending on the adequacy of the fol-
lower's performance. Transactional leadership depends on con-
tingent reinforcement, either positive contingent reward (CR) or
the more negative active or passive forms of management-by-
exception (MBE-A or MBE-P).
Contingent Reward (CR). This constructive transaction has
been found to be reasonably effective, although not as much as
any of the transformational components, in motivating others to
achieve higher levels of development and performance. With this
method, the leader assigns or gets agreement on what needs to be
done and promises rewards or actually rewards others in
exchange for satisfactorily carrying the assignment (Coefficient
oc= .89).
Management-by-Exception (MBE). This corrective transac-
tion tends to be more ineffective. But it may be required in certain
situations. This corrective transaction may be active (MBE-A) or
^ passive (MBE-P). In MBE-A, the leader arranges to actively moni- ,
Tp~ tor deviances from standards, mistakes, and errors in the ~0"
follower's assignments and to take corrective action as neces-
sary (a = .74). MBE-P implies waiting passively for deviances,
mistakes, and errors to occur and then taking corrective action
(a =.73).
Laissez-Faire Leadership (LF). This is the avoidance or
absence of leadership and is, by definition, most inactive, as well
as most ineffective according to almost all research on the style
(a = .79). As opposed to transactional leadership, laissez-faire
represents a nontransaction.
<>
<>
Fundamental to the full-range leadership model is that every

leader displays each style to some amount. An optimal profile
is shown in Figure 1. The third dimension of this model (depth)
represents how frequently a leader displays a particular style
of leadership. The active dimension is by self-evident definition;
the effectiveness dimension is based on empirical findings.
In Figure 1, the leader infrequently displays LF leadership,
higher frequencies of the transactional leadership styles of MBE-P,
MBE-A, and CR. The transformational components are most fre-
quently manifested. In contrast, as shown in Figure 2, the poorly
performing leader tends toward inactivity and ineffectiveness.
FIGURE 1
Optimal Profile
EFFECTIVE
■& <>
PASSIVE ACTIVE
INEFFECTIVE
(From Bass & Avolio, 1994)
<>
-e
Introduction
FIGURE 2
Suboptimal Profile
EFFECTIVE
PASSIVE ACTIVE
-& <>
INEFFECTIVE
(From Bass & Avolio, 1994)
EMPIRICAL SUPPORT
Many research studies have been completed in business and

industry, government, the military, educational institutions, and
nonprofit organizations, all of them showing that transforma-
tional leaders, as measured by the MLQ survey instruments
derived from the Avolio and Bass model, were more effective and
satisfying as leaders than transactional leaders, although the best
of leaders frequently do some of the latter but more of the former.
Follow-up investigations have shown that developing transforma-
tional leadership with training in its four components can
enhance effectiveness and satisfaction as a leader. These results
are reflected in the models in Figures 1 and 2.
<>
Bass Book 1 2/26/96 11:58 PM Page 10
<>
10 A New Paradigm of Leadership
Correlations With Independent Criteria

Transformational leadership as measured by subordinates'
ratings has been shown to correlate more highly than transac-
tional leadership with various independent criteria. Thus 25 proj-
ect champions based on interviews in 28 different organizations
were shown to display more transformational behaviors than 25
matched non-champions (Howell & Higgins, 1990). Transform-
ational mean scores were also higher among innovative school
principals, Marine Corps commanders of more highly effective
helicopter squadrons (Salter, 1989), Methodist ministers with
greater Sunday church attendance and membership growth
(Onnen, 1987), presidents of MBA teams completing complex
simulations with greater financial success (Avolio, Waldman
& Einstein, 1988), middle business managers with future fin-
ancial success of their business units (Howell & Avolio, 1993),
middle managers with better management committee evaluations
(Hater & Bass, 1988), and junior Naval officers with recom-
mendations for early promotion and better fitness reports
(Yammarino & Bass, 1990a).
-^y. Meta-Analyses. The hierarchy of correlations in individual r\_
^ studies that is found in the correlation of the MLQ components ^
with effectiveness is usually: charisma > individualized con-
sideration > intellectual stimulation > contingent reward >
managing-by-exception > laissez-faire leadership. Two meta-
analyses have been completed which support the model. Lowe,
Kroeck & Sivasubramaniam (1994) completed a meta-analysis of
data for 2,873 to 4,242 respondents in public agencies and the
private sector and showed that the correlation between each
component of the MLQ generally was consistent with the model.
Thus the mean corrected correlations with effectiveness for the
public (including military) and private sectors were respectively:
charisma, .74, .69; intellectual stimulation, .65, .56; individual-
ized consideration, .63, .62; contingent reward, .41, .41; and
managing-by-exception, .10, -.02.
Gasper (1992) completed a second meta-analysis of demon-
strated transformational and transactional leadership pooling the
transformational components in one composite and the transac-
tional over in another composite. For 20 studies, the mean
corrected transformational leadership correlated respectively .76,
.71 and .88 with effectiveness, satisfaction and extra effort per-
ceived by the followers. The corresponding corrected correlations
with transactional leadership were .27, .22 and .32.
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Bass Book 1 2/27/96 12:06 AM Page 11
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Introduction 11
FURTHER ASSUMPTIONS AND PROPOSITIONS

Further specific theoretical and hypothesized propositions
have been tested with affirmative results. Bass (1985) proposed an
augmentation relationship between transformational and transac-
tional leadership. It was suggested that transformational leader-
ship augments transactional in predicting effects on follower
satisfaction and performance. Specifically, in statistical terms,
transformational leadership should account for unique variance
in ratings of performance (or other outcomes) above and beyond
that accounted for by active transactional leadership.
Waldman, Bass, and Yammarino (1988) reported evidence for
the augmentation effect among various samples of industrial man-
agers and military officers. The augmentation effect was also
obtained by Seltzer and Bass (1990) for a sample of 300 part-time
MBA students, each describing their superiors at their full-time
working settings. For another sample of 130 MB As, who each
asked three of their followers to complete MLQs about them, the
augmentation effect held up when one follower's leader-
ship ratings and a second follower's outcomes were correlated.
The same augmentation effect occurred when initiation and
_r-\ consideration, as measured by the Leader Behavior Description _^^_
^r Questionnaire (LBDQ), was substituted as the measure of trans- M^~
actional leadership. These results demonstrate a fundamental
point emphasized in the Bass (1985) theory of leadership: Trans-
actional leadership, particularly contingent reward, provides a
broad basis for effective leadership, but a greater amount of effort,
effectiveness and satisfaction is possible from transactional lead-
ership if augmented by transformational leadership. Finally, and
as reported earlier by Howell and Avolio (1993), transformational
leadership also augments transactional in predicting levels of
innovation, risk-taking and creativity.
Transformational Leadership Can Be Either Directive or

Participative, as Well as Democratic or Authoritarian,
Elitist or Leveling
Critics have perceived transformational leadership to be elit-
ist and antidemocratic. Indeed, particularly when dealing with
charisma, Weber and his successors emphasized the extent that
the leader directed his dependent followers out of crises with
radical solutions to deal with their problems. Again, inspirational
leaders were seen to be highly directive in their means and
methods. The intellectually stimulating leader challenged his
followers and the individually considerate leader could rise
above the demands for equality from his followers to treat them
differently according to their different needs for growth.
-e-
■e-
At the same time, such transformational leaders could share

the building of visions and ideas that could be a democratic and
collective enterprise. They could encourage follower participa-
tion in the change processes involved. In the same way, transac-
tional leadership can be either directive or participative.
Table 1 illustrates formulaic statements illustrating that trans-
formational and transactional leadership can be either directive
or participative, democratic or authoritarian. We have found this
theorization not only useful but essential to convincing trainees
that transformational leadership is not a veiled attempt at resur-
recting participative leadership. It can be participative, as well as
more directive in orientation (Avolio & Bass, 1991).
TABLE 1
Descriptions of Participative Versus Directive Leadership
and the Components of the Full Range of Leadership
Participative Directive
Laissez-Faire "Whatever you think is "If my followers need answers
the correct choice is OK to questions, let them find
<>
Management-
with me."
"Let's develop the rules
the answers themselves."
"These are the rules and this
<±
by-Exception together that we will use to is how you have violated
identify mistakes." them."
Contingent "Let's agree on what has to "If you achieve the objectives
Reward be done and how you will I've set, I will recognize your
be rewarded if you achieve accomplishment with the
the objectives." following reward..."
Individualized "What can we do as a group "I will provide the support
Consideration to give each other the neces- you need in your efforts to
sary support to develop our develop yourself in the job."
capabilities?"
Intellectual "Can we try to look at our "You must reexamine the
Stimulation assumptions as a group with- assumption that a cold fusion
out being critical of each engine is a physical impos-
other's ideas until all assum- sibility. Revisit this problem
ptions have been listed?" and question your assumption."
Inspirational "Let's work together to merge "You need to say to yourself
Motivation our aspirations and goals for that every day you are getting
the good of our group." better. You must look at your
progression and continue to
build upon it over time."
Idealized "We can be a winning team "Alea iacta est" (i.e., "I've
Influence because of our faith in each made the decision to cross the
other. I need your support to Rubicon, so there's no going
achieve our mission." back") "You must trust me
and my direction to achieve
what we have set out to do."
(From Avolio & Bass, 1991)
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Bass Book 1 2/27/96 12:08 AM Page 13
-Q-
Introduction 13
Ideals and Self-Actualization

In Burns' (1978) conception of the transforming leader,
clearly he had in mind the inspiring by the leader of followers to
work toward transcendent goals, to work for the greater good
beyond their own self-interests. At the same time he saw the
transforming leader moving followers towards self-actualization.
This could prove to be a conflict between follower's concern for
their self-interests and their concern for larger causes. This
conflict may be more a theoretical rather than realistic possibility.
The extent leaders focus on individualized consideration (which
presumably aims to elevate followers on Maslow's need hierarchy
toward achievement and self-actualization) correlates positively
with the extent they are inspirational (building enthusiasm,
challenge and meaning).
Construct Validation of the Model

The components of transformational and transactional leader-
ship and their meaning have been identified in a variety of ways:
factor analyses, observations, interviews and descriptions of the
rh ideal leader that people carry around in their heads. A\
Development of the MLQ. Burn's concept of the transforming
leader was used to elicit accounts of leaders who fit the descrip-
tion. These were converted to 141 behavioral statements. Eleven
judges agreed on 73 as transformational or transactional. Prin-
cipal component factor analyses were completed of the frequency
which 196 U.S. Army colonels said each of the items described
one of their immediate superiors. Numerous subsequent factor
analyses and more recent partial least squares analyses supported
the components that emerged (Bass, 1985; Avolio & Howell,
1990).
Three factors were obtained whose items beforehand had
been judged transformational: charismatic-inspirational, intellec-
tually stimulating and individually considerate. Since the dynam-
ics and literature on charisma and inspiration were quite different,
we opted to maintain them as separate components. Salient in
charisma is the identification of the follower with the charismatic
and the desire to emulate him or her. Salient to inspiration is the
providing of meaning and challenge to the follower. Leaders
who do a lot of one are also likely to do a lot of the other, but the
dynamics, content, focus, antecedents and consequences may
be different.
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Bass Book 1 2/29/96 10:06 AM Page 14
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The transactional items formed a factor of contingent reward,

management-by-exception and laissez-faire. Subsequent analyses
supported splitting management-by-exception into two compo-
nents (Hater & Bass, 1988) and most recently a factor of empow-
erment has been split off from the laissez-faire leadership factor.
Diaries. Virginia Military Academy cadets reported in
unstructured logs or diaries the leadership behavior they observed
during a given set of days. These logs could be reliably scored
in terms of all of the components noted earlier. These, in time,
could be linked to independently obtained questionnaire results
(Atwater, Avolio & Bass, 1991).
Interviews. Interviews with executives about the leadership
they had seen produced numerous other behavioral examples of
transformational leadership. Charismatic leadership was attrib-
uted to the interviewer's bosses for setting examples, showing
determination, extraordinary talents, taking risks, creating in
subordinates a sense of empowerment, showing dedication to
"the cause," creating a sense of a joint mission, dealing with crises
using radical solutions and engendering faith in the subordinates
_z:\_ for the leadership. _^N_
Inspirational leadership included providing meaning and

challenge, painting an optimistic future, molding expectations,
creating self-fulfilling prophesies and thinking ahead. Intellectual
stimulation was judged present when their superiors questioned
assumptions, encouraged subordinates to employ intuition,
entertained ideas that may have seemed silly at first, created
imaginative visions, asked subordinates to rework the same prob-
lems they thought they had solved and saw unusual patterns.
Individualized consideration was apparent to interviewees when
their bosses answered them with minimum delay, showed they
were concerned for their subordinates' well-being, assigned tasks
based on subordinate needs and abilities, encouraged two-way
exchanges of ideas, were available when needed, encouraged
self-development, practiced walk-around management and effec-
tively mentored, counseled and coached.
When peers of V.M.I, military cadet leaders were asked what
characterized the important traits of a good leader, they tended to
describe traits of inspiration, intellectual stimulation and individ-
ualized consideration such as: self-confidence, persuasiveness,
concern for the well-being of others, the ability to articulate one's
■o-
Bass Book 1 2/29/96 10:12 AM Page 15
<>
Introduction 15
ideas and thoughts, providing models to be emulated by others,

holding high expectations for himself and others, keeping others
well-informed, and maintaining high motivation in himself
(Atwater, Lau, Bass, Avolio, Camobreco, & Whitmore, 1994).
The Full Range of Leadership Development Program (Avolio
& Bass, 1991) begins with participants describing their implicit
theories of leadership as evidenced by an ideal leader each has
known. Invariably, for well over 1,000 trainees, the characteristics
of the ideal leader has included the four components of transfor-
mational leadership and contingent reward.
Pseudotransformational Leadership
Charismatic leadership may be socialized or personalized.
Socialized charismatic leadership is based on egalitarian behav-
ior, serves collective interests and develops and empowers others.
Socialized leaders tend to be altruistic and to use legitimate estab-
lished channels of authority (McClelland, 1975; Howell & House,
1992). Personalized charismatic leadership is based on personal
dominance and authoritarian behavior, is self-aggrandizing,
rh serves the self-interest and is exploitative of others (McClelland, fK
^ 1975). Personalized leaders rely heavily on manipulation, threat ^
and punishment, and show disregard for the established insti-
tutional procedures and for the rights and feelings of others. They
are impulsively aggressive, narcissistic and impetuous (Howell
& House, 1992).
For me, originally the dynamics of transformational leader-
ship were expected to be the same whether beneficial or harmful
to followers (Bass, 1985), although Burns (1978) believed that to
be transforming, a leader had to be morally uplifting. I have come
to agree with Burns and now see that the personalized transfor-
mational leader is better conceived as a pseudotransformational
leader. He or she may exhibit many transforming displays but
cater, in the long run, to his or her own self-interests.
Truly transformational leaders transcend their own self-inter-
ests for one of two reasons: utilitarian or moral principles. If util-
itarian, their objective is to benefit the organization, society, the
group, the attachment to the social group that one is a member
of, the collective of individual members; and/or to meet the
challenges of the task or mission. If a matter of moral principles,
the objective is to do the right thing, to do what fits principles
-e-
<>
of morality, responsibility, sense of discipline, and/or respect

for authority, customs, rules and traditions of a society. There is
belief in the social responsibility of the leader and the organi-
zation. Tom Paine's writings illustrate the truly transforming
leader in his appeals to reason in "Common Sense" and "Age of
Reason," appeals to principle in his "Rights of Man" and his
oft-quoted need for transcendence, "These are the times that try-
men's souls."
Pseudotransformational leaders are self-oriented, self-aggran-
dizing, exploitative, narcissistic, power-oriented and openly talk
about distorted utilitarian and warped moral principles.
<> <y-
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Bass Book 2-3 2/29/96 10:15 AM Page 17
-e
SECTION 2
Commitment, Involvement,
Loyalty and Performance
Introduction
In this section we will look at the contribution of transfor-
mational leadership to commitment and its concomitants of
involvement, loyalty, satisfaction and the mechanisms underlying
the process. Failure to provide meaning to their service and
unmet expectations appeared most salient in the incidence of 649
administrative discharges from the U.S. Army in Europe for April
1978. A majority was disappointed, and confusion was a common
expression during unstructured interviews (Manning & Ingraham,
1981). Transformational leadership, at all levels in the hierarchy,
-Q- might have reduced this number considerably, for numerous -£J)-
independent studies have shown that commitment of followers
is higher where their leadership is more transformational. Thus,
in a doctoral dissertation, Pitman (1993) showed how much
the commitment of 245 white collar workers in six organizations
correlated with various measures of transformational leadership
among their supervisors. The Multifactor Leadership Question-
naire scales of charisma and inspiration correlated .40 with com-
mitment to stay and .24 with commitment to organizational
values. The Conger-Kanungo scales (Conger & Kanungo, 1988)
that measured such transformational attributes as vision, articula-
tion, sensitivity, unconventional behavior, taking personal risks
and not maintaining the status quo correlated .38 with commit-
ment to stay and value commitment. The correlation of commit-
ment was .23 to organizational values.
Even where commitment to unionism and willingness to vote
to support the union are strong, actual participation in union activ-
ities remain low. Nonetheless, when there is a lot of contact with
shop stewards by rank-and-file employees, participation in union
activities is increased if the stewards have exhibited transfor-
mational leadership as measured by 15 items of charisma, inspir-
ation, intellectual stimulation and individualized consideration.
17
-e-
Bass Book 2-3 2/27/96 12:15 AM Page It
-Q-
...most striking ... is the pervasive effect exerted by

perception of the stewards' (transformational) leader-
ship styles. Members' perceptions of shop stewards'
leadership styles predicted members' loyalty, sense of
responsibility and actual participation in union activ-
ities. (Kelloway & Barling, 1993, p. 263)
Fullagar, McCoy and Shull (1992) noted that the loyalty
toward the union of 70 electrical apprentices was related to the
transformational characteristics of the socializing agents.
A study involving 846 in 89 secondary schools in Singapore
likewise demonstrated that commitment to the organization and
related citizenship behavior and job satisfaction was significantly
greater when the principals were described by the teachers as
more transformational on the MLQ scales (Koh, 1990).
Commitment may also be a matter of attachment to supervi-
sor and work group and/or attachment to senior management
and the organization (Becker & Billings, 1993). Niehoff, Eng and
Grover (1990) surveyed 862 insurance company employees in
^ various positions at the home office and in the field. Commitment ,
~^7~ to the organization was positively affected by the extent top man- ~~&~
agement inspired a shared vision (r = .58), encouraged inno-
vativeness (r = .69), and supported employees' efforts (r = .32).
Commitment and job satisfaction correlated .75. Intentions to
quit, job satisfaction and prosocial behavior likewise depend on
the nature of the soldier's commitment. Transformational leader-
ship by the immediate superior can enhance local commitment
and help in commitment to the organization, but transformational
leadership at the top of the organization is likely to be needed for
commitment to extend to the organization as a whole.
New Kinds of Confrontations for the Military

Gal (1987a) pointed out that the nature of wars has changed
in recent years. The U.S. in Vietnam and the Israeli incursion into
Lebanon in 1982 were cited as examples of wars lacking the pub-
lic consensus about goals, lack of civilian support for political
and military decisions which undermined the strength of the
soldiers' and commanders' beliefs. This was in contrast to public
support in earlier wars. Troops in these earlier wars did not ques-
tion their legitimacy and rarely disobeyed orders, assaulted
officers at the battle front, or engaged in protests for ideological
reasons as occurred in Vietnam and Lebanon.
-£>
Bass Book 2-3 2/27/96 12:23 AM Page 19
~Q-
Commitment, Involvement, Loyalty and Performance 19
Increasingly, complicated deterrent postures are required of

the military. For example, constabulary actions (Janowitz, 1960)
are required of the Army such as in Somalia and Haiti where
peacekeeping may turn into battles. Goals are less clear and
undefined. The fighting ethic is upset. Better educated and more
sophisticated youth require some way of identifying and sup-
porting the decision process, not merely complying blindly in
executing orders. Education produces a more thoughtful, slower
and less predictable response to unclear and less well-defined
situations where training produces the quicker, unthinking
response likely to be correct if the situation has been well defined
(O' Rourke, 1985). The "fighting man" cannot be divorced from the
"thinking man." The battlefield increasingly becomes more lethal,
intensive, individual, and small-unit oriented (Sarkesian, 1986).
Commitment and Military Motivation

Gal (1987) argued that the older models of leadership of path
goal or situational leadership did not address the needs for soldier
and officer commitment which could be met by the newer model
^ of transformational leadership. For Gal, commitment is a central ,
~t7~ concept in military motivation in contrast to the earlier emphasis -£:)-
on compliance through obedience. The will to fight may still be
lacking without commitment. "It is the commitment to the point
of death which creates the unlimited liability clause of military
members" (Hackett, 1979). And for such commitment, Gal (1987)
argues strongly that transformational leadership is needed at
all levels.
Commitment is the backbone of the military profes-
sion. For most military professionals, belonging to the
armed forces is not merely a question of a place to work,
a job, or an occupation. It is a way of life and frequently
a lifetime commitment....
Commitment can be a very powerful motivation,
more so than a paycheck, especially when military activ-
ities involve high risk, extreme demands, and severe
stress. Obedience and compliance with orders and com-
mands becomes the key to organizational functioning.
Obedience and commitment can be considered as the
two modes of military compliance.... (Gal, 1985, p. 1)
Obedience is initiated by fear and punishment dur-
ing the early phases of socialization into military life
<>
Bass Book 2-3 2/27/96 12:24 AM Page 20
■e-
(highly transactional; coupled with increasing substitu-

tions of rewards of recognition, badges, promotion, etc.).
It is enhanced by threat and sanction and instilled
through endless drills and orders. Obedience is gradu-
ally replaced by internalized patterns of behavior that
become autonomous... Even when the legitimacy of an
organizational goal is questionable, if behavior is moti-
vated by obedience, well-indoctrinated soldiers will
continue to comply even though orders are debatable.
Military obedience succeeds in shielding soldiers from
conflicts emerging from concerns about the legitimacy of
missions. Thus, fear and external power predominantly
generate military discipline and its obedient behavior...
obedience is essential for good performance, efficiency,
and mission completion as well; without it, the whole
military structure would collapse.
However, obedience can be a double-edged sword,
especially when it becomes blind... under certain cir-
cumstances most individuals can be pushed to the point
^ of fully obedient behavior despite their doubts or dis- ,
vT- tress. ...acting in obedience to a perceived legitimized -£}-
authority, individuals can lose all sense of responsibility
for their most destructive acts.... (Gal, 1985, pp. 1-2)
Facets of Commitment
There are three facets of commitment within the military:
organization, career, and moral. Organizational commitment is to
the organization's goals, purposes, and norms. Career commit-
ment is to one's own success, and moral commitment is to the
basic moral codes that one believes in and for which one will sac-
rifice (Sarkesian, 1981). The three facets need to be in alignment
for the military professional to be in harmony with his or her
organization. For those in command position, there is commit-
ment to one's men, one's unit and one's task. Commitment,
according to Gal, derives from one's own internalized sense of
duty, responsibility and conviction. Orders do not come from a
single external source as in the case of obedience, but reflect the
interaction of beliefs, values and conscience.
An important aspect of transformational leadership is devel-
oping, maintaining and enhancing this alignment. Flowing from
this alignment are societal and organizational goals comple-
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Bass Book 2-3 2/29/96 10:16 AM Page 21
-e-
menting the professionals' values and norms, making them will-

ing to devote themselves, or even sacrifice themselves, to attain
the goals. Transformational leaders' commitment additionally
includes the feelings of responsibility for personnel and task
which responsibility derives from the leader's own conscience
and internalized values. When the three modes of commitment
are out of alignment, the leader and the soldier may fall back on
obedience, serve their most important commitment or rationalize
their actions as matters of obedience and professional loyalties
(Gal, 1985).
Commitment to the organization, to career and to moral val-
ues will differ systematically if the leadership generating the
commitment is socialized or personalized. Clearly both trained
obedience and educated commitment are needed in the military.
While obedience is maintained through transactional corrective
processes of managing-by-exception and more constructive con-
tingent reward, being led by sticks and carrots does little for one's
self-esteem or commitment. In fact, it may hurt one's feelings of
self-worth and serve to reduce one's sense of commitment.
v7~ Impact of Transformational Leadership -&-

Obedience and/or commitment based on the faith and confi-
dence in the charismatic leader may be somewhat different in its
effects. Exerting extra effort to show support for the leader, want-
ing to emulate the leader to emotionally identify with him or her,
may maintain obedience without loss of any sense of self-esteem.
In fact, self-esteem is likely to be enhanced in identifying with the
goals, interests and values of the charismatic leader. Moreover,
commitment to the organization and its goals is enhanced by the
extent the leader is engaging in inspirational behavior which pro-
vides meaning for the soldier in the organizational mission and
challenge for accomplishing it. Physical and emotional excitation
is aroused in the process. Military values and beliefs are shared.
Felt responsibilities are encouraged by the transformational leader.
The inspirational leader works to move subordinates to con-
sider the moral values involved in their duties as citizen soldiers.
Cromwell's New Model Army became invincible as its soldiers
saw themselves fighting for the cause of righteousness and free-
dom from royal tyranny.
The transformational leader, whether a corporal leading
a squad or a commanding general leading an Army, further
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increases commitment by employing intellectual stimulation.

The education and concerns of the soldier are enlisted in a
joint effort to deal with problems in a creative way. Unusual
approaches emerge such as when a U.S. non-com re framed a
problem when challenged and figured out how to quickly convert
tanks into bulldozers to cut through the Normandy hedgerows
and was empowered to do so. Pride in the actions of all those
involved as well as joint success in overcoming obstacles are com-
bined. Commitments are reinforced.
Individualized consideration at all levels also enhances com-
mitment. Subordinates feel their personal career needs are being
met. Additionally, the coaching and mentoring provided them by
their superior provides them with a sense of increased compe-
tence to carry out orders. Indirect evidence of the importance to
military commitment of perceiving fulfillment of training goals
was provided by Tannenbaum, Mathieus, Salas & Cannon-Bowers
(1991). For 666 military trainees in socialization training, post-
training organizational commitment was related to training fulfill-
ment as well as motivations and self-efficacy.
^ -&■
THE DYNAMICS OF TRANSFORMATIONAL

LEADERSHIP AND COMMITMENT
A Charismatic-Inspirational Approach
Shamir, House & Arthur (1993) explained the dynamic mech-
anisms involved in transformational leadership, particularly
charismatic leadership as defined in House (1977) which included
the components of idealized influence, inspirational leadership
and intellectual stimulation. We are practical and goal-oriented,
seeking rewards and avoiding punishments. But we also express
feelings, aesthetic values and self-concepts to recognize and affirm
our attitudes, beliefs and values. We are motivated to maintain
and enhance our self-esteem and sense of competence to cope
with our environment. Meaning is provided in the continuity of
past, present and future and the match between our behavior and
our self-concept. Our self-concept is a composite of our identities
as members of a nationality, social group, sex, etc., some of which
are more important to us than others. Faith as well as rational cal-
culation motivates us. Given this appreciation of human nature, it
becomes possible to understand the different effects of transfor-
mational and transactional leaders on commitment.
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By emphasizing the symbolic and expressive aspects of the

effort, the important values involved, the transformational leader
makes a moral statement. In contrast, the transactional leader
stresses benefits to satisfy the self-interests of the follower. For the
transformational leader, participation in the effort becomes an
expression of membership and identity with a social collective.
The salience of that identity is increased in the follower's self-
concept which subjects the follower to social and psychological
forces enhancing his or her commitment.
The followers' self-esteem is reinforced by the transforma-
tional leader by expressions of confidence in the followers. High
expectations are set by the transformational leader, which induces
greater commitment to the effort. This Pygmalion effect, for
instance, showed that when Israeli artillery trainees were told
they had been especially selected for their assignments because of
their aptitude scores indicating they would do very well, they
demonstrated a much better record of hits than those told they
had been selected on an accidental basis (Eden & Shani, 1982).
By articulating a vision or a mission, the transformational
_^^_ leader increases the intrinsic value of goal accomplishment. _ZA_
^ Going beyond a transactional leader's specifying and clarifying
the goals, the transformational leader presents the values in the
goals. Accomplishment of the goals becomes more meaningful
and consistent with the self-concepts of the followers. Empha-
sized also by the transformational leader is the importance of the
goal as a basis for group identity further connecting self-identity
with group identity.
Transcendental elements in human aspirations which go
beyond rational calculations are dwelt upon by the transforma-
tional leader. If charismatic, they personify these transcendental
desires and are viewed as "larger than life." An irrational bond
is created between the leaders and the followers providing the
followers with transcending "the reasonable."
Charismatic and inspirational leaders instill faith in a better
future for the followers in terms of their self-expression, self-eval-
uation and self-consistency. Followers attribute their own extra
effort to internal self-related causes rather than to extrinsic
rewards, further adding to the followers' commitment to the
"cause," and to vague and distal goals. Faith in a better future is
an intrinsically satisfying condition in itself.
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Transformational Versus Pseudotransformational Leaders

The concept of the pseudotransformational leader was intro-
duced in Section 1. Truly transformational leaders are socialized.
Commitment, involvement and loyalty from followers will derive
from the truly transformational leader's referent power and
esteem. At the other extreme are coercive, pseudotransforma-
tional leaders who are personalized in outlook. They use their
power to reward and punish in arbitrary ways to dominate their
followers. They tend to be authoritarian in attitude, self-aggran-
dizing and exploitive of their followers. Manipulation, threat
and promises are used to induce compliance. Punishments may
be capricious and non-contingent. They can be pseudotransfor-
mational in that followers fear loss of support from the powerful
figures. Such tyrants are narcissistic, impetuous and impulsively
aggressive. They bring about obedience and compliance in
followers but it is less likely to be internalized. Commitment is
public but not private. Commitment, involvement and loyalty
derive from dependence on the leader resulting from fear of pun-
ishment or loss of the leader's affection.
-O- Truly transformational leaders such as Mahatma Gandhi or _£\_
' Martin Luther King appealed ideologically to a better future for ^
their followers without harming others. They talked about
universal brotherhood. Such leaders looked to developing their
followers and stimulated them intellectually. Personalized
pseudotransformational tyrants demand domination over others
at the others' expense. Of Kelman's (1958) three different influ-
ence processes, compliance, identification and internalization,
socialized leaders try to achieve internalization. Convergence of
values between leaders and followers is stressed. Personalized
tyrants emphasize compliance (transactional) and identification
(pseudotransformational). They demand unquestioning obedi-
ence. Pseudotransformational personalized leaders bring about
change by articulating goals that are ethnocentric and/or xeno-
phobic deriving from the leaders' personality needs and motives.
Influence is achieved through personal identification with the
leaders, dependence on them for approval, and the need for
followers to devote themselves to the leaders' interests.
In contrast to the commitment of followers that can be
achieved by the socially oriented transformational leader, com-
mitment under personalized pseudotransformational leaders is
likely to be ephemeral for most followers lasting only as long as
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Bass Book 2-3 2/27/96 12:28 AM Page 25
<>
the leader can continue to induce fear and promise in the follow-
ers either directly or as a consequence of conditioning. Further-
more, when commitment is a consequence of the power of a
coercive leader, it may generate hostility, withdrawal and over-
reaction (Bass, 1960).
In achieving internalization and commitment in followers
the socialized transformational leader fosters changes in their
self-concept. Their self-concept becomes closer to that of the
leader. There is a greater sense of a collective identity and collec-
tive efficacy. Self-worth is enhanced. There is a drive to maintain
consistency between their actions and their self-concepts. They
are more committed to their roles. The meaning of their actions,
roles and identities come closer together. Self-efficacy and collec-
tive efficacy are enhanced (Shamir, House & Arthur, 1993).
Transference
Kets de Vries (1994) likens a leader to a psychiatric social
worker who can become a container for the emotions of his
subordinates. The empathy of the leader seen as individually con-
-Q- siderate makes this kind of effort. As a consequence, some psy- _ry_
^ chodynamic transference may result which in turn promotes the
subordinates' attachment to the individually considerate leader
and the leader's organizational interests.
Perceived Leader Competence

The charismatic component of transformational leadership
involves a variety of dynamics, one of which that enhances the
commitment of followers to charismatic leaders is the followers'
perception of the competence of the leader. In turn, the leader
"creates the impression of competence and success" (House,
1977). So following the transformational leader is seen by follow-
ers as a way to ensure their own competence. Leaders "communi-
cate high expectations of, and confidence in followers" (House,
1977) generating the Pygmalion effect (Eden & Ravid, 1982). Fol-
lowers are moved to fulfill the leader's prophesies of confidence
in them. The followers accept the leader's goals and believe they
can contribute to reaching the goals. Their motivation to achieve
the goals is aroused.
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£>
Disinhibition
Disinhibition in the followers may occur when they endow
the leader with charisma and become emotionally aroused. In
their excitation by the leader, their judgments may be restricted
and their inhibition reduced (Schiffer, 1973). "The sense of reality
of the charismatic leaders and their followers are inordinately
affected by psychodynamic mechanisms such as projection,
repression, and disassociation" (Bass, 1985, p. 56). The charis-
matic leader may become a catalyst for rationalization by the
followers as they develop shared norms and fantasies about the
leader and what the leader can accomplish for them. Charismatic
leadership is most likely to emerge when followers are under
stress or in a state of crisis. The charismatic leader has the temer-
ity to propose radical solutions to deal with the stress or crisis,
which further enhances his or her esteem in the eyes of the
followers (Weber, 1924/1947). The more general effects of trans-
formational leadership on stress and crisis conditions is the sub-
ject of Section 3, the next section.
Moral Commitment
i Transformational leadership does not stop with the success- ^
ml elevation of followers from lower level to higher level needs
and the enhancement of follower performance beyond what
would be expected from contingent reinforcement. Awareness
and consciousness are aroused about organizational goals.
A shared agreement is developed that bonds leader and followers
in a moral commitment to a cause which goes beyond their own
self-interests. Moral leadership is achieved (Burns, 1978;
Sergiovanni, 1990). Transformational leadership is moral author-
ity for Sergiovanni (1990) which unites leaders and followers in
pursuit of higher level common goals. Although common pur-
poses may start as separate aims, he concluded "When moral
authority transcends bureaucratic leadership in a school, the out-
comes in terms of commitment and performance far exceed
expectations" (p. 23).
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Acknowledgements 27
Performance Beyond Expectations

Shamir, House and Arthur's (1993) formal theory presented
earlier explains how and why transformational leadership moves
followers to exceed expectations in performance. Such perform-
ance is beyond what would be motivated by transactional
leadership. Continued dependence on rewards and punishments,
contingent on satisfactory performance, leaves the follower feel-
ing less adequate than where the follower's self-esteem is engaged
by the challenges of the mission as set forth by the transfor-
mational leader, the identification of the follower's self with the
successful leader and team effort, the exciting experience of unex-
pected discoveries and the sense of empowerment as a mature
adult rather than continued treatment as an immature child.
Thus, commitment of followers is enhanced by transformational
leaders in that the leaders increase the sense of self-worth among
the followers for such commitment, internalize the favorable atti-
tudes of the followers toward achieving the collective's success,
create in followers the desire to emulate the leaders and by their
commitment show their support for the leaders.
A -4-
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SECTION 3
Stress and Transactional/

Why is stress greater under transactional leadership? Given

what is known, it may be easier to answer the question by asking
what about transformational leadership serves to relieve distress
and reduce or resolve conflicts.
Leadership and Stress

Stress arises when well-being is threatened. Groups and organ-
izations will experience stress when confronted with threats to
their steady states of well-being. In many instances, leadership
makes the difference in coping with the stress. Decision-making is
-£)- likely to suffer unless effective leadership is provided which can -£X
help foster the quality of the decision. In the acute stress of
emergencies and disasters, panic will be prevented by leaders
who encourage advanced preparation and well-trained, well-
organized, credible systems. Chronic stress will be better handled
when leaders are able to transform personal concerns into efforts
to achieve group goals.
Such leadership is transformational, particularly charismatic
and inspirational, and has been shown to reduce feelings of burn-
out and symptoms of stress in professionals. Confidence in such
transformational leadership is particularly important. The charis-
matic leaders are able to maintain extraordinary presence of mind
in the face of such threats and crises.
Stressing environments can be characterized by uncertainty,
volatility, and turbulence. In combat, dealing with surprise
and unforeseen contingencies is critical. In business, start-up
ventures, mergers, acquisitions and divestitures, economic down-
turns, new competitive challenges, erosion of market share, and
rapid changes in technology can create stresses and dislocations
in organizations. Under crisis ridden or uncertain conditions,
transactional leaders who are reactive and depend on old rules
29
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and regulations to maintain and control the system are unlikely

to help followers to cope with the situation as would transfor-
mational leaders who are proactive, break with tradition, provide
innovative solutions, and institutionalize new arrangements
(Bass, 1990).
In the Military. In combat, visible inspirational leadership
may make the difference between complete victory and over-
whelming defeat. "A rational army would run away," declared
Montesquieu. A twitch of emotion may change an intact com-
mand into an army in rout (Keegan, 1987). A visible transforma-
tional leader can make the difference between a rout or a rally.
Sheridan riding back to rally his retreating troopers illustrated
the importance of the leader's visibility in sharing the risk and
turning attention away from "sauve qui peut" to moving forward
to attack the enemy. The Israeli Defense Forces requirement that
leaders be in front of their troops to be able to say "follow me"
likewise points to the significance of the leaders' importance
in visibly supporting their units and setting the example to be
followed in risky situations (Gal and Jones, 1985).
-z:^_ Repeated observations indicated that the disruption of lead- r\_
ership during combat was one of the factors responsible for
psychiatric breakdowns in battle along with other aspects pro-
moted by transformational leadership such as group identifica-
tion and group cohesiveness. Again, Steiner and Neuman (1978)
noted that following the 1973 war, Israeli soldiers suffering psy-
chiatric breakdown lacked trust in their leadership and did not
feel they belonged to their combat units. Their self-esteem for
their military performance was low. Clearly, transformational
leadership was missing for them.
Confidence in their commanders was critical to Israeli
soldiers' morale in the 1982 Lebanon excursion. Again, transfor-
mational leadership was the key, for the three elements inspiring
confidence in the commander were belief in the commander's
professional competence, belief in his credibility, and perception
of how caring he was.
In Industry. The Chief Executive Officer (CEO) of Silicon
Graphics illustrates the importance of a transformational leader
in stressful, crisis, and chaotic conditions. Silicon Graphics is
one of the fastest growing computer companies in the U.S. It is
in an industry in which international competition is "fast and
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Stress and Transactional/Transformational Leadership 31
ferocious." The CEO has created within the organization a

relaxed, individually considerate, corporate atmosphere where
people dress casually and have off-beat fun. He has a steady low-
key personality. He intellectually stimulates employees to think
creatively. Trust is emphasized as a way to make it possible to
"thrive on chaos." The calming effect of the CEO who encourages
"serious fun" appears to be an important factor in working in an
environment where change is the norm.
In the University. Neumann (1992) pointed out how college
presidents can use the college budget to induce feelings of finan-
cial stress, which heightens the budget's symbolic meaning for
the faculty. The faculty will expect and call for transformational
leadership to deal with the pressure. In one case of financial
crisis, a president emphasized intellectually stimulating meaning
and challenge in his leadership. He laid out the steps which might
be taken and sought a faculty consensus. In a second case of finan-
cial crisis, the president was more transactional. He focused atten-
tion on documentation, numbers, codes and technical terms. He
didn't try to organize or mobilize the faculty's thinking on what
was to be done. The first president who provided interpretation,
\.7~ meaning, structure and implications for the future was seen as ~(:^~
more effective by the faculty in dealing with the financial crisis
than the second president who concentrated on financial analyses.
In Teams. For conflict within teams and small groups, there
are a number of ways that transformational leadership contributes
to the resolution of the conflicts. For example, the inspirational
leader creates a positive, optimistic environment for identifying
the conflict and an expectation of its resolution. Search for super-
ordinate goals is encouraged that transcend the differing objec-
tives of the opposing parties.
The intellectually stimulating leader moves the team to
define the conflict, to identify the facts and opinions, to determine
the desired results, and to obtain open statements of opinions (for
which trust of the transformational leader is needed). Different
solutions with transforming superordinate goals need to be kept
in mind, as well as how they will be implemented and evaluated
(Atwater & Bass, 1994).
In Relations With One's Boss. Cognitive Resources Theory
suggests that the highly intelligent but inexperienced leader will
be ineffective when in conflict with his or her boss. Much more
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<>
effective will be the experienced, but not as highly intelligent,

leader facing the same conflict with superiors (Fiedler, 1986).
Consistent with Cognitive Resource Theory (Gibson, Fiedler and
Barrett, 1993) showed that experienced rather than highly intelli-
gent leaders are intellectually stimulating in that they promote
creativity in the groups they lead when the leaders are under
stress due to conflict with their immediate superior. In such
circumstances, the more intelligent leaders are not only less
intellectually stimulating as evidenced by the lack of creativity of
the group but also the intelligent but inexperienced leaders
actually inhibit the group's functioning. There is much babble by
the leaders and the groups—much more talk and many fewer
ideas generated under such stressful conditions.
Leadership and Crises

Crises call for special leadership talents.
'Crisis' refers to a situation facing an organization
which requires that the organization, under time con-
straints, engage in new, untested, unlearned behaviors in
-CX- order to obtain or maintain its desired goal states ... r\
... a crisis requires uncertain action under time pres-
sure. When uncertain action is required without time
pressure, the situation may be viewed as a problem
rather than a crisis. When required actions and out-
comes are known but when time pressure exists, organi-
zations (can) engage standard, albeit critical, procedures
or routines. (Krackhardt & Stern, 1988, p. 125)
In such organizational crises, Krackhardt and Stern empha-
size the importance of adaptation and cooperation, which in turn,
requires trust and friendly relationships. Such trust can be
created by charismatic and/or inspirational leaders and such
relationships can be developed by individually considerate lead-
ers. This would suggest that the organization would be in better
shape to handle crises, uncertainty and threats of required change
if headed by transformational leaders.
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The Dynamics of Charisma and Crisis

Weber (1924/1947) noted that charismatic leaders are likely
to emerge during times of instability, crisis and turmoil. Such
times increase the feelings among people of helplessness, agita-
tion, anxiety and frustration. They accept the directions of charis-
matic leaders who appear to be qualified to lead them out of their
distress. This potential for reducing stress creates the
special emotional intensity of the charismatic
response ... Followers respond to the charismatic leader
with passionate loyalty because the salvation, or prom-
ise of it, that he appears to embody represents the fulfill-
ment of urgently felt needs. (Tucker, 1970, p. 81)
Those under stress and seeking relief from it readily respond
zealously to leaders who strengthen their faith in that relief. By
calling for a transcendental goal or innovative inspirational
mission to relieve the stress, charismatic leaders induce renewal
and mobilize collective effort to face the stress or crisis. Radical
changes and bold, unconventional actions are advocated con-
_£^_ sistent with their own ideologies, values and beliefs. Without
~^3~ such collective perception of crisis or stress, charismatic lead- ~()-
ership is less likely to appear. There is no need for an exceptional
leader with radical solutions. Under such circumstances, the
charismatic is too unsettling and likely to be seen as a disturber of
stability, continuity, and certainty (Conger & Kanungo, 1988;
Howell, 1988).
Nonetheless, charismatic leadership does occur in the
absence of crisis or distress. Personally seeking to shake up the
status quo, charismatic leaders, particularly the pseudotransfor-
mational personalized ones, identify and exaggerate existing
shortcomings in the situation and the grievances of followers.
They create dissatisfaction with the status quo so that followers
are motivated to accept the radical solutions that the charismatic
leaders advocate to eliminate the distressful problems (Conger &
Kanungo, 1988a).
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Some of the stress and sense of crisis of charismatic leaders,

particularly those at the head of organizations, may be felt by
themselves as they manufacture it for their followers. There is the
well-known experience of loneliness of command. They may find
themselves, when at the top, without the collegial supports to
which they had been accustomed. Each of their moves carries a
lot of responsibility and symbolic meanings. Their own depend-
ency needs cannot be met. Yet they also are envied their power
and position, which can be a cause of anxiety for them. There is
fear of losing their power and position because of the envy, and a
dysfunctional consequence is the fear of being too innovative and
too successful. A cause of depression and possible adventurism
for those who are at the top is the feeling that there is nothing else
to strive for (Kets de Vries, 1994).
Rationality Versus Irrationality

Janis and Mann (1977) argued that the completely rational
approach to an authentic threat requires vigilant responses—
a full examination of objectives, of values, and of alternative
courses of action. Costs and risks of various alternatives should be ,
"V7" weighed. A final choice should be based on a cost-benefit analy- -&-
sis. Careful development, implementation, and contingency plan-
ning are also part of the vigilant response to threat. But such
vigilance, thorough search, appraisal, and contingency planning
will be short-circuited by the emotional arousal of the side-effects
of the impending threat observed in the irrational reactions to
crises. These defective reactions include the fixed adherence to
the status quo, a too hasty change, defensive avoidance, or panic.
Whether formal or informal, leadership will make a difference in
whether followers act rationally or irrationally in coping with
stress and crisis conditions.
For instance, in times of crisis, informal leadership is likely
to emerge if the formal authorities and emergency services cannot
deal with the crisis events. The direct removal of the threats and
obstacles that are the source of stress may be facilitated by sup-
portive (individually considerate) informal leadership. Pseudo-
transformational leaders who seize power may increase the stress
and increase anxieties. Anxieties may be reduced by providing
supportive, individually considerate leadership, resulting in an
increasing sense of security.
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Bass Book 2-3 2/27/96 12:43 AM Page 35
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Transformational Versus Transactional Leadership

Leaders can help their groups in many ways to cope with
stress. For instance, individuals, groups, or organizations may be
frozen into inertia and disbelief in facing a crisis in which they
are seriously threatened. They may be aroused and alerted by
inspirational leaders. The transactional leader who concentrates
on simple rewards and punishments and the demands by follow-
ers for immediate gratification will be prone to accept hasty,
poorly thought-out decisions. Despite the public pressure to "act
now," transformational leaders are more likely to delay premature
choice among options and call for reconsideration of proposals.
When their followers are engaged in defensive avoidance,
transformational leaders bring them back to reality. Panic can
be reduced or avoided by inspirational leadership that points
the way to safety. In general, groups with leaders, transactional
or transformational, are likely to cope better with stress than
those without such leadership. More directiveness will be
expected and desired from leaders by groups and organizations
under stress. During times of social stress, inspirational leadership
_^^_ will be expected that revises missions, defines common objectives, _c\
^ restructures situations, and suggests solutions to deal with the
sources of stress and conflict (Downton, 1973). But, as we shall
also see, while such directive leadership is most expected, desired,
and successful in influencing the course of events when stress is
high, it may not always be effective in coping with the stress.
Leaders as the Cause of Stress. Indeed, leadership may con-
tribute to stress. Personalized, self-aggrandizing, charismatic
leaders can cause more stress among their followers, for instance,
when they excite a mob to take too hasty actions. Pseudotransfor-
mational political leaders manufacture crises to enhance their
own power, to divert public attention from real problems, and to
gain public support for their own arbitrary actions. Thus, leader-
ship may be the cause rather than the amelioration of stressful
conditions that result in emotionally driven actions by the follow-
ers and poorer long-term outcomes. And the leaders who emerge
are likely to be different from those in unstressed situations. They
may actually contribute to the stress.
Transactional leaders, particularly those who rely on manag-
ing-by-exception, who emphasize reactive corrective actions, may
increase stress in their followers; transformational leaders who
emphasize charismatic, inspirational and individualized consid-
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Bass Book 2-3 2/27/96 12:48 AM Page 36
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eration, and proactive vigilant solutions are likely to reduce the

feelings of stress in their followers. As noted in the preceding sec-
tion on commitment, transformational leadership raises the self-
esteem of followers. Transactional leadership that is coercive in
its promises and threats does the opposite, lowering the self-
esteem of followers who feel stressed, subjugated and victimized
by the coercive leader.
Seltzer, Numerof, and Bass (1989) found that, when other
factors were held constant, transactional leaders, those in partic-
ular who practiced management-by-exception, increased the
felt stress and job "burnout" among their subordinates. In a series
of experiments, Misumi (1985) showed that production-prodding
leadership with instructions such as: "work more quickly," "work
accurately," "you could do more," "hurry up, we haven't much
time left," generated detectable physiological stress symptoms.
Systolic and diastolic blood pressure increased in experimental
as compared to control subjects as did galvanic skin responses.
In similar experiments, production-oriented leadership caused
feelings of hostility and anxiety about the experiments.
^ Abrasive leaders use their power to coerce their followers. ^
~^^~ They cause stress. For many subordinates, their immediate ~^^"
supervisors may be the most stressful aspect of the work situation
(e.g., Herzberg, 1966). Tyrannical bosses are frequently mentioned
as a main source of stress on the job. This becomes most extreme
when the transactional leader says, "Either you do as I say or
else...." Such leaders base the transaction or exchange on the
power to coerce their followers (Bass, 1960). The leaders them-
selves may be personally more prone to stress. Sanders and
Malkis (1982) found that Type A (stress-prone) personalities
were nominated more often as leaders than Type B's. However,
the fewer Type B's who were chosen as leaders tended to be
more effective as individuals in the assigned task than were the
Type A leaders.
Faulty Decision-Making. Leaders stressed themselves gener-
ate faulty decision-making. Careful analysis and rational calcula-
tion based on learning and experience, is replaced in stressed
leaders by unproductive, intuitive reactions which satisfy their
immediate emotional needs rather than the realistic demands of
the situation. Calamities of famine, war, and revolution intensify
emotional arousal, distort cognitive processes, focus attention on
the calamity, withdraw attention to the rest of the environment,
speed up disintegration of the self, and reduce rationality of
behavior (Sorokin, 1943).
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SUCCESSFUL BUT NOT NECESSARILY EFFECTIVE

LEADERSHIP IN STRESS SITUATIONS
Transactional leadership may succeed when followers are

under stress. That is, the followers are influenced by the leader's
promises of escape from the stress and threats that failure to
follow the leader will increase stress. For instance, such leader-
ship can point the way to escape from a panic and can help the
followers to avoid disaster. But such leadership can also influence
followers to take actions in particular ways which may not be
most effective in helping followers to reach their goals. Without
the needed articulation of mission and leader support for deliber-
ation, faulty decisions made too hastily and defensive reactions
among followers may ensue. Individualized consideration, in the
form of consultation, will decrease instead of increasing.
Hasty Decision-Making. When followers are under stress,
speedy decisions are likely to be readily accepted. Followers
exchange their desires for deliberation, participation and time to
reflect for the promise of speedy delivery from the distressing
conditions. But speedy decisions do not necessarily provide the
K.J best solutions to the problems facing the followers. The speed of ~x.T
the decisions may result in inadequate solutions to the stressful
circumstances. The decisions are likely to lack the inclusion of
careful structuring and support. Generally rapid decision-making
is sought in crisis and disasters and will be effective if the deci-
sions are not hastily made at the last minute but are based on
advanced warning, preparation, and organization, along with
commitment and support.
In emergencies, when danger threatens, subordinates want to
be told what to do, and in a hurry. They believe that they have
no time to consider alternatives. Rapid, decisive leadership is
demanded. Leaders who fail to make decisions quickly would be
judged as inadequate. Leaders speed up their decision-making
as a consequence of stress and crises. Failure to do so leads to
their rejection as leaders. Acceptance of their rapid, arbitrary
decisions without consultation, negotiation, or participation is
also increased. A leader who can react quickly in emergencies
will be judged as better by followers than one who cannot
(Körten, 1962). Taking prompt action in emergency situations
differentiated those judged to be better military officers from
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Bass Book 2-3 2/27/96 12:50 AM Page 36
<>
those judged as worse in performance. Particularly at lower levels

in the military organization, underscored is the rapidity of
response to orders from higher authority. This is despite the
fact that most units seldom operate under combat conditions
(Stouffer, Suchman, DeVinney, Star, & Williams, 1949).
Where rapid decisions are called for, executives are likely to
manage-by-exception. The more organizations wish to be pre-
pared for emergency action, the more they are likely to stress a
high degree of structure, attention to orders and active managing-
by-exception by their supervisors. When 181 airmen gave their
opinions about missile teams, rescue teams, scientific teams, or
other small crews facing emergencies, the majority to two-thirds
strongly agreed that they should respond to the orders of the
commander with less question than under normal conditions. In
an emergency, the commander was expected to "check more
closely to see that everyone is carrying out his responsibility"
(Torrance, 1956/1957). Similarly, Mulder, dejong, Koppelaar, and
Verhage (1986) reported that Dutch naval officers were more
favorably evaluated by their superiors and subordinates if they
used their formal power when facing crisis situations. More direc- ,
"t 7~ tion was sought from the officers akin to contingent reinforcement -£ lo-
using the power to reward and discipline.
But the more arbitrary decision-making may prove costly.
Thus, in three research and development organizations, stress
was caused by a reduction in available research funds. This
resulted in strong internal pressures for controls on spending and
top management control and direction. There was a reduction in
individualized consideration reflected in reduced consultation
with the researchers. Subsequently, researchers' satisfaction and
identification with the organization declined.
To conclude, directive leadership will be preferred and
successful in influencing followers under stress. Hasty decision-
making is likely to be promoted possibly providing instant or tem-
porary relief, but which may fail to deal with the root causes of
the stress. Such leadership may be counterproductive in the
long run.
Defensive Avoidance. As already noted, often it is the politi-
cal leaders themselves who contrive the threats, crises, and ambi-
guities. For millennia, pseudotransformational political leaders
have used real or fictitious threat as the way to increase cohesion
&
Bass Book 2-3 2/29/96 10:32 AM Page 39
<y-
among their followers and to gain unquestioning support for

themselves. Often, such leaders arise in crises of national weak-
ness, dislocation, and a breakdown of institutions. They provide
ready-made immediate solutions that soothe, flatter, and exalt the
public. Defensive avoidance is promoted. Blame is directed else-
where. The same leaders also are transactional when they say- "If
you follow me and do exactly what I say you will escape harm
from the forces that I've told you are threatening your well-being "
The success in being influential of such leaders will depend on
how charismatic and inspirational they are able to be but they
are unlikely to be effective in the long run in dealing with the
true problems.
Even when business and government leaders are seen to
consult and share decisions with subordinates in times of crises
often it is because they seek support from their subordinates
about the wisdom of the solutions the leaders have already cho-
sen. Also, the leaders want to spread the responsibility for the
decision from themselves to their group.
"0- STRESS AND EFFECTIVENESS AS A LEADER

<>
1 J By leadership that is effective in coping with stress, we mean

leadership that results in rationally defensible quality decisions
appropriate use of available information, skills and resources, and
enhanced performance of followers in reaching their goals despite
the threats and obstacles to doing so. Such effective coping with
stress may come from changing the leaders (Hamblin, 1958), but
more often as a consequence of transformational leadership.
Combat
As noted earlier, in combat, less stress will be found in
soldiers with confidence in their commanders (Gal & Jones, 1985)
This confidence derives from the demonstrated professional com-
petence of the commander (charisma), from belief in his credi-
bility (inspiration), and from the soldiers' perception that the
commander cares about his troops (individualized consider-
ation). Under continuing combat stress, professional competence
becomes particularly important according to a study of Israeli
soldiers in Lebanon in 1982.
-o-
Bass Book 2-3 2/27/96 12:52 AM Page 40
&
Teams Under Stress. After reviewing some of the litera-

ture, Burgess, Salas, Cannon-Bowers & Hall (1992) formulated
training guidelines for leaders of teams under stress. The strate-
gies they presented included such transactional approaches as:
the contingent rewarding and managing-by-exception involving
double-checking of team member performance, focusing on the
task-at-hand, providing feedback, monitoring member perfor-
mance, and trouble-shooting to locate and correct errors. Equally
present in their strategies were implementing transformational
strategies for handling possible crises in the future, ensuring
individual member competence, understanding of the mission,
alignment of individual member's goals with those of the team,
establishing trust and cooperation and providing support.
Handling Conflict
The transformational leader envisions superordinate goals
for the conflicting parties—ways in which they both can gain
from agreement. He or she points to the inability of one party to
get along without the assistance of the other. Yet, the freedom of
action of each party is maintained. Transactional elements may be
_s-\ introduced with creation of an organizational restructuring satis- ,-.
~W~ factory to both parties which eliminates the sources of the con- ~&~
flict. Ways are sought to increase the trust of the parties for each
other to guarantee that they will keep the agreement. The nature
of the conflict is clarified along with available creative alterna-
tives to resolve it. Each side is helped to understand the other's
position. Both parties are encouraged to avoid rigid positions.
In twenty departments of two universities, it was found that
the amount of affective and substantive conflict in departments
contributed to felt tension. Transactional leadership was seen as
needed for those departments which were in conflict. Leader initi-
ation of structure correlated highly with departmental effective-
ness but not when such conflict was absent. The correlation
between leader initiation of structure in a department and its effec-
tiveness was .63 when affective conflict was high and only .29
when affective conflict was low. The correlation between initia-
tion and effectiveness was .51 when substantive conflict was high
and .38 when substantive conflict was low in an experiment to
confirm these findings. For a routine coding task, initiating struc-
ture correlated .46 with productivity when conflict was high and
-.62 when conflict was absent.
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Bass Book 2-3 2/29/96 10:33 AM Page 41
-Q-
When quick and decisive action is vital to resolving the

conflict between parties, assertive, dominating leadership may be
most appropriate. This may also be true when unpopular actions
such as cost-cutting are needed and cooperation from the parties
is not being sought. For the transformational leader, such
assertiveness may be required when superordinate organizational
interests take precedence.
The intellectually stimulating leader will move the parties
toward a solution which integrates into a collaborative solution
the efforts of the parties in conflict. The conflict is turned into a
mutual problem to be solved. A transactional leader will search
for expedient compromises that are immediately rewarding, are
temporary settlements, and/or avoid disruptions. Even laissez-
faire leadership seems appropriate for certain cases when the
leader decides to avoid dealing with the conflict because it is a
trivial matter, when the descriptions or costs of the only solution
outweigh the benefits, or when the two parties may need to
calm down before they can deal more rationally with their
mutual conflict.
~XT~ Dealing With Mergers -£^-

When one organization is acquired by another in a merger, in
general, the employees captured may be disturbed by the loss of
identity and purpose. Anxiety, anger, depression, or helplessness
may occur in some of them. Resignations and forced departures
occur along with threats to one's own security. Survival in the
merged organization may become an obsession. Transformational
leadership is needed to deal with the merging of the cultures of
the acquired organization and the organization taking over, tran-
scending both organizations. The future contingent reward sys-
tem needs to be clearly communicated along with feedback on
how well it works. Support, consideration, and commitment are
needed in helping to cope with the stress of the merger.
Individualized consideration is necessary so that the leaders
"get information about the acquiring organization for their subor-
dinates; identify counterparts in the other (and make contact and
help subordinates to understand that their counterparts in the
acquiring firm are not the "bad guys" and, in many cases, are in a
situation similar to their own" (Schweiger, Ivancevich, & Power,
1987, p. 135).
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Bass Book 2-3 2/27/96 12:53 AM Page 42
-&
Transformational leadership can help subordinates and

colleagues to smooth the tensions of disengagement, disidentifi-
cation with the old situation and disenchantment with the new
arrangements, and disorientation without anchors to the past or
the future. Individually considerate leaders can help colleagues
and subordinates to work through their denials and anger. An
attractive vision of the future by the inspirational leader can gain
acceptance of the new situation (Tichy & Devanna, 1986).
Dealing With Panic

The most effective leaders in helping groups to escape from
panic conditions begin with transformational support and
encouragement, then concentrate on the transactional perform-
ance requirements (Misumi & Sako, 1982). A panic situation
was simulated with 672 undergraduates in six-person groups.
The percentage of successful escaping, the degree of jamming,
and aggressiveness were measured. The percentage of successful
escaping was highest and aggression lowest in the PM condition
when leaders focused both on performance planning and on
maintenance of relationships in contrast to focusing on only one
T7" or the other, or neither (Misumi, 1985). When subjects dealing ~£}~
with a maze under fearful and unfearful conditions were com-
pared (Kugihara & Misumi, 1984), again PM leadership generated
the least fear, the largest amount of planning, and least unreason-
able felt pressure from the leader.
Klein (1976) observed in an experimental study of the panic
condition, of too many people trying to escape through the same
door, that the stressed group preferred a strong leader rather than
a leader who under low stress was elected and more highly
acceptable. Acceptance and election, which under conditions of
low stress gave the accepted legitimate leader control of the
group's fate, was replaced under high stress by the group turning
to a less legitimate but stronger leader, seen to be endowed with
more competence. Transactional structuring combined with
transformational competence and consideration appear required
for effective leadership under panic conditions. This is seen again
when community disasters occur.
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Bass Book 2-3 2/25/96 6:39 PM Page 43
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Dealing With Disaster

At the national, state and community level, effective leader-
ship promotes the development of credible warning systems and
preparations long before disasters actually strike. The absence of
such effective leadership is marked by maladaptive defensiveness
by the public and exacerbation of panic reactions (Harman, 1984).
At the organizational level, needed are technical and behavioral
preparation for crises. Management needs warning systems and
crisis command centers for managing-by-exception as well as for
maintaining readiness, confidence and support. Employees need
training in safety, security, and detection along with emotional
preparation for emergencies (Mitroff, Shrivastava, & Udwadia,
1987). Weinberg (1987) reviewed 30 cases of how groups dealt
with earthquakes, blizzards, accidents, and hurricanes. Break-
down occurred when there was laissez-faire leadership. Effective
leadership provided the needed vision and support of individual-
ized consideration and the structure and preparations of transac-
tional leadership.
Such structure and preparedness was seen in the readi-
er}- ness and the strong chain of command found in tests of the _f^_
^ Lawrence/Douglas County, Kansas emergency preparedness sys-
tern. Resources were well organized and the staff highly trained
(Watson, 1984). Similarly, emergency preparedness aided Alexan-
dria, Virginia to cope with disastrous flooding (Harman, 1984).
City-wide drills for ambulance drivers provided effectiveness in
handling of the Hyatt Regency disaster in Kansas City (Ross, 1982).
The local police, fire, ambulance services, and public works
departments can provide the needed structure and preparedness.
They are the critical human resources whose effective utiliza-
tion is paramount in the times of crisis (Kartez, 1984). The leader-
ship of these resources at the time of the crisis determines the
effectiveness of the organized response to disaster. Most effective
is when the organizations maintain their own identity and do not
depend on outside volunteer help. Least effective is when only
an amorphous organizational structure is in place.
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Bass Book 2-3 2/27/96 12:54 AM Page 44
-Q-
I have already noted that the transformational leadership

components of charisma, inspirational leadership, intellectual
stimulation, and individualized consideration (Bass, 1985) con-
tribute to effective leadership under stress. For one thing, charis-
matic transformational leaders tend to keep their "cool" when
faced with threats to their lives. Thus, Mahatma Gandhi,
F. D. Roosevelt, Kemal Ataturk, Benito Mussolini, Kwame
Nkrumah, Charles de Gaulle, and Ronald Reagan displayed
presence of mind and composure when faced with attempts to
assassinate them. They were not easily frightened nor discon-
certed. They remained calm. They maintained their sense of
humor and were not thrown off balance in the face of danger or
crisis (Willner, 1968). Combat heroes tend to come from the same
mold. When 77 Israeli medal winners in the Yom Kippur War
were contrasted with ordinary soldiers, the medal winners exhib-
ited more emotional stability. They also showed aspects of trans-
formational leadership: perseverance under stress, decisiveness,
and devotion to duty (Gal, 1985). (Of course, these are also
aspects of the effective leader, but as has been shown in Figure 1,
and discussed on page 8, the effective leader tends to display
ry_ more transformational behavior.) _^^_
What Transformational and Transactional Leadership

Accomplishes
While transactional leadership can service structure and
readiness that is already in place, transformational leadership
adds to the structure and readiness by helping the followers to
transcend their own immediate self-interests and by increasing
their awareness of the larger issues. They shift goals away from
personal safety and security towards achievement, self-actual-
ization, and the greater good. The transformational leader may
have the charisma to fulfill the frustrated needs for identity
and lack of social support felt by followers. Bradley (1987)
found that the presence or absence of charisma in a commune's
leadership affected the commune's survival. Communes did not
survive if their members sought charismatic leadership which
was not provided.
■B-
Bass Book 2-3 2/27/96 12:55 AM Page 45
O
Personalized (Pseudotransformational) Versus Socialized

Transformational Approaches. Personalized pseudotransforma-
tional leaders and socially transformational leaders deal with
their followers' stress differently. Such followers may feel per-
sonally inadequate because of the gap between their self-per-
ceived images of what they are and what they ideally should and
would like to be. Stress is increased if they feel they cannot
reduce the gap. Frustration may result in aggression and feelings
of dependency. To help followers cope with their frustration, self-
aggrandizing personalized leaders make themselves the object of
identification for the followers (Downton, 1973) but socially
transformational leaders use individualized consideration to pro-
vide opportunities for their followers to develop themselves
(Levinson, 1980).
The transformational leader manifests individualized con-
sideration and converts crises into developmental challenges.
The transformational leader uses intellectual stimulation to foster
followers' thoughtful, creative, adaptive solutions to stress rather
than hasty, defensive, maladaptive ones to the stressful con-
ditions. The transformational leadership does not replace the ,
vT- transactional leadership that has provided the necessary structure ~&~
for readiness. It adds to it (Waldman, Bass, & Yammarino, 1988).
Without the transformational leadership, the transactional leader-
ship may prove inadequate.
Why Transformational Leadership Is Needed. Autocratic,
rapid decision-making is sought from their leaders by ready-to-be-
influenced groups under stress or crisis conditions. Nonetheless,
to be effective in stressful situations, leaders must organize the
efforts of their followers in ways which promote vigilance, thor-
ough search, thorough appraisal, and contingency planning to
avoid defective coping with threat. Bolstering—each member
assuring the others about the correctness of their opinion and
solution—can be minimized by the leader playing the devil's
advocate. Quick and easy decision-making can be avoided by
forming the decision-making group with members who differ in
background and opinion.
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Bass Book 2-3 2/29/96 10:33 AM Page 46
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To be effective in crisis conditions, the leaders must be

transformational—able to rise above what their followers see as
their immediate needs and appropriate reactions. Such leaders
need to arouse inert followers to the significance of threats and
the group's lack of preparedness. The leaders need to alter inert
followers' willingness to live with frustration rather than make
efforts to deal more adequately with obstacles in their path to
reach positive objectives. Similarly, to be effective, instead of
catering to the group's immediate needs and fears, leaders need
to calm the demands for hasty change. To be effective, leaders
need to be transformational in identifying and publicizing the
inadequacy of defensive pseudo-solutions. To be effective, leaders
need to be transformational in providing goals transcending self-
interests for hypervigilant followers in a state of panic. To be
effective when panic is imminent, leaders need to provide clear,
confident direction. The transformational leader's vision for the
future may set the stage for effective planning ahead; neverthe-
less, transactional leadership may also be important in planning.
Planning Ahead. Effective political leaders prevent crises or
^ their stressful effects by planning ahead (Yarmolinsky, 1987). ,
vT- Effective transactional leaders practice active management-by- -£:)-
exception by setting up early warning mechanisms to avoid
surprises produced in last-minute hasty, ill-conceived behavior.
Potential crises are recognized rationally without emotional
upset. Appropriate searches for information can be instituted
without hasty defensiveness. However, it takes a transformational
leader to articulate the need for an early warning system and to
mobilize the organization to prepare for acute crisis (Tichy &
Devanna, 1986). In advance, such leaders devise tactics to be
employed to avoid or defuse the crisis and to persuade followers
to accept the proposed tactics and mobilize support for them. In
this sense, the leadership takes on an important teaching function
(Yarmolinsky, 1987). By anticipating potential crises, by prepar-
ing with active management-by-exception in advance for them,
and by long-range, proactive, envisioning transformational
leadership, leaders are more effective than if they only engage
in dealing with immediate problems (Katz, 1951).
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Bass Book 2-3 2/25/96 6:56 PM Page 47
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What Transactional Leadership Alone Fails To Do. A transac-

tional leader manages emergencies with structures that have
already been set up by actively managing-by-exception. He or
she can supply solutions for immediate member needs as per-
ceived by them. There will be immediate satisfaction with such
leadership but not necessarily long-term positive effectiveness
in coping with the stressful conditions. What may be necessary
is a transformational leader who evokes higher-level needs,
such as for the common good, who moves followers into a fully
vigilant search for long-term readiness. As noted before, when
Mulder, van Eck, & dejong (1971) examined patterns of leadership
in a Dutch navy flotilla on active duty, the transactional inter-
personal and task-oriented factors emerged as of some importance
but what distinguished effective leadership in crisis compared
with non-crisis conditions was intense, powerful, self-confident
leadership that characterizes the charismatic transformational
leadership. In contrast, "mild" person-leader relationships were
successful and effective in non-crisis situations.
Some Quantitative Evidence of the Effects of Transforma-
tional and Transactional Leadership. Direct survey evidence of
v7~ the effects of transactional and transformational leadership were ~Q~
obtained by Seltzer, Numerof, and Bass (1989) from 285 to 296
MBA students holding full-time jobs who completed the Personal
Stress Symptom Assessment (Numerof, Cramer, & Shachar-
Hendin, 1984). The MBA's indicated how often they experienced
headaches, fatigue, irritability, loss of appetite, insomnia, and
inability to relax. They also completed the Gillespie-Numerof
Burnout Inventory (Numerof & Gillespie, 1984), responding to
such items as: "I'm fed up with my job," and "my job has me
at the end of my rope." Felt stress and burnout correlated .58.
The 277 respondents also described their immediate superior
with the Multifactor Leadership Questionnaire, Form 5R (Bass
& Avolio, 1990b).
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Bass Book 2-3 2/29/96 10:36 AM Page 48
<>
Table 2 shows the first-order correlations of the transforma-

tional and transactional leadership ratings scores of the superiors
and the felt stress and burnout of their subordinates. As can be
seen in Table 2, stress was modestly but significantly reduced by
charisma (-.18), intellectual stimulation (-.11), and individualized
consideration (-.18) and burnout, much more, (-.52, -.46, -.36).
Contingent reward also helped reduce burnout (-.43), but manage-
ment-by-exception did the opposite (.22). Seltzer, Numerof, and
Bass concluded that 14 percent of the variance in reported symp-
toms of stress and 34 percent of the variance in feelings of
burnout could be attributed to the lack of transformational leader-
ship and contingent rewarding and more frequent management-
by-exception. They also found that if the other factors were held
constant through multiple regression analysis, reported stress
and burnout were less if one worked under a charismatic and
individually considerate leader. However, stress and burnout
were somewhat higher if the MBA's worked at their full-time job
under an intellectually stimulating leader. With the other factors
held constant, contingent rewarding was modestly associated
with less stress and management-by-exception with more stress
fK and burnout. Overall, transformational leadership and contingent A\
^^ rewarding by leaders were effective in reducing feelings of stress ^
and burnout; managing-by-exception accomplished the opposite.
Transforming Crises Into Challenges. Intellectually stimula-
ting transformational leaders can halt crises by questioning
assumptions and disclosing opportunities, fostering unlearn-
ing, and eliminating fixation on old ways of doing things. Inspir-
ational leaders arouse courage and stimulate enthusiasm. The
cyanide-lacing of Tylenol on store shelves struck Johnson and
Johnson in 1982. Its public relations department had no plans to
deal with such acute crises. The CEO provided transforma-
tional direction. He rejected glossing over the disaster but actually
converted the marketing disaster into an opportunity to gain
credit for good citizenship. He regained the firm's market share
by deciding to introduce a tamper-proof Tylenol bottle at a time
of great public consciousness and publicity about the problem
(Snyder, 1983).
<>
Bass Book 2-3 2/29/96 10:37 AM Page 49
-Q-
TABLE 2
First-Order Correlations of Transactional and
Transformational Leadership of Superiors and the Felt
Stress and Burnout Among Their Subordinates
Leadership Symptoms Felt

Stress Burnout
N = 285 N = 296
Transformational
Charisma -.18* -.52*
Individualized consideration -.18* -.46*
Intellectual stimulation -.11 -.36*
Transactional
Contingent rewards -.18* -.43*
Management-by-exception .09 .22*
-e r=0.14*,p<.01 <>
(Adapted from Seltzer, Numerof, and Bass, 1989)
McCauley (1987) pointed to a number of both transforma-

tional and transactional ways leaders can convert a stressful situ-
ation into a challenging one. The leader practices contingent
rewarding by ensuring that there will be positive outcomes and
followers know what these are. Clear and attainable goals are
set. Interim rewards for progress are given. More generally, using
intellectual stimulation, taxing conditions are converted into
problems to be solved. Inspirational leadership is employed to
increase self-confidence. Envisioning, enabling and empowering
followers provides greater tolerance for ambiguity, uncertainty,
and working with new and unfamiliar conditions. Situations
beyond one's control are recognized but the situation may need to
be redefined and goals may need to be changed. Sometimes,
seemingly insurmountable problems disappear when ignored.
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Bass Book 2-3 2/25/96 6:56 PM Page 50
-Q-
Pines (1980) summarized the ways that transformational

leaders can provide the support that makes for hardy followers,
quality performance and effective decision-making despite the
presence of distressful conditions. Leaders can present dramatic
changes as challenges, not as threats. Leaders can select followers
who prefer a vigorous, fast-paced lifestyle and have the cogni-
tive capacity and readiness to prepare themselves for coping
adequately with the stress. Leaders can increase their followers'
sense they are the masters of their own fate. Followers' involve-
ment and commitment can be increased by their empowerment
to offset focusing on the deleterious effects of the stress. The
intellectually stimulating leader can introduce the metaphor of
mountain climbers who do not look down the vertical cliff face
and their dangerous exposure but concentrate on the holds and
grips available immediately in front of them.
It is important for the leaders themselves to believe they
face a challenging problem rather than a crisis. They are more
open to ideas and suggestions from their subordinates. More
effective decisions are reached as a consequence. Thus, Tjosvold
(1984) arranged in an experiment for "managers" to lead "subor-
~TJ~ dinates" who were actually confederates of the experimenter. The ~&~
"managers" supposedly had to deal with an issue of job rotation.
They were told they were in a crisis condition, a challenging
condition, or a situation of minor consequence. The "managers"
who believed they were in a crisis were most close-minded. They
most were in disagreement with their "subordinates" and least
interested in hearing more from their "subordinates." They exhib-
ited least knowledge of their "subordinates" arguments. They
were least likely to change from their original position. Contrarily,
those "managers" who thought they were in a challenging situa-
tion were most likely to explore and incorporate "subordinates"
views into their own. They were most likely to integrate their
subordinates' opposing opinions into their own decisions. They
indicated most often the desire to hear more arguments.
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Bass Book 2-3 2/25/96 6:56 PM Page 51
£>
Enhancing Cohesion. Transformational leaders reduce stress

among followers by creating a sense of identity with a social
network of support. Felt stress is reduced as the follower is made
to feel part of a larger entity. The insecurity of feeling isolated is
replaced by the security of a sense of belonging. Pines (1980)
listed numerous objective examples that people with the social
support of close friends, relatives, and group associations. For
instance, they had lower mortality rates than those without such
social support. Again, children in Israeli kibbutzim were less
anxious during prolonged bombardments than were Israeli urban
children. The loss of social ties through ostracism and isolation
can be deadly among primitive peoples. Ganster, Fusilier, and
Mayes (1986) reported for 326 employees of a large contracting
firm that social support from their supervisors, co-workers, fam-
ily, and friends buffered the experience of strains of depression,
role ambiguity, role conflict, frustrating underutilization of skills
and somatic complaints. Child care crises could be handled most
effectively by child care workers, according to 30 of them, with
leadership that was supportive, respectful, calm, and confident.
Such leadership clarified the situation and prepared for future
r-\_ crises. The children were dealt with ineffectively by leadership r\
^ that was authoritarian, did not provide support, control and good ^
communications (Nelson, 1978).
Illustrating the importance of supportive individualized
consideration in treating stress in combat is a card of information
prepared for British non-coms to keep in a pocket. Included in
ways to help with acute symptoms are: do not overreact, remain
calm yourself, do not ridicule, calm the soldier, reassure the
soldier, show understanding, and team up with him for a while.
If possible, give him a warm drink and give him a specific task.
If the stress reactions continue: keep the soldier with his unit but
away from battle; allow him to sleep; treat him as a soldier, not a
patient; have someone stay near him such as a supervisor; try to
have members of his unit take interest in his welfare; and have
him help on small jobs.
<>
Bass Book 4-5 2/26/96 9:24 AM Page 53
"&
SECTION 4
Contingencies of Transformational
and Transactional Leadership
Introduction
Do situational contingencies make a difference? If they do,
what are they and how much of a difference do they make?
Numerous anecdotal examples can be cited. General George
B. McClellan was loved by his troops. He was highly effective in
training and organizing his troops but completely ineffective—
almost laissez-faire when it came to fighting. In his campaigns to
try to seize Richmond, the Confederate capital, he avoided, as
much as possible, putting his troops in harm's way. Instead of
advancing with his superior forces and doing battle with Lee, he
-Q- retreated. Charismatic, he was idealized by his men, but unable -£}-
to win battles. He could have reduced the length of the Civil
War by two years. He was also vain, pompous and self-glorifying.
If the evaluation of his leadership was based only on his accom-
plishments in training his Army of the Potomac, he would be
judged effective, charismatic and inspirational. If the evaluation
of his leadership was based on the way he led his Army in
the Peninsula campaign toward Richmond, he would be judged
ineffective and laissez-faire in his avoiding confrontation with
rebel forces. His leadership was contingent on whether he was
training troops or leading them into combat.
In the ongoing organization or society, understanding of the
leader's behavior requires examining a stream of causality.
The effective leader is transformational or transactional as con-
ditions change. Burns (1956) has noted the way that Franklin
Delano Roosevelt was a practical, transactional experimentalist,
as well as a charismatic with principles about social betterment.
On assuming office, he moved the electorate inspirationally from
the pessimism of the deep economic depression to feelings of
hope, expectation, entitlement and demand as he succeeded in
putting into place many remedial programs ranging from rural
electrification to social security. At the same time, many of his
efforts such as the NRA ran into the Supreme Court's conservative
53
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Bass Book 4-5 2/29/96 10:42 AM Page 54
-Q-
views of the Constitution, resulting in his ill-considered scheme

to pack the Supreme Court. Later on, knowing that sooner or later
we would have to fight Germany but that he could not overcome
the isolationist opposition, he began to take as many escalating
transactional, manipulative steps as he could to help Britain such
as initiating "lend-lease." Britain was near-bankrupt and could
not purchase the military goods we could sell to them. So Roo-
sevelt arranged to "lend" the planes, tanks and ships to Britain in
exchange for off-shore bases in the Bahamas, Bermuda and other
British colonies. He facetiously agreed when asked that the
materiel would be returned when the war was over.
Harry Truman succeeded to the Presidency on F.D. Roo-
sevelt's death, "without experience, without knowledge, without
prestige" according to the New York Times. He had been a trans-
actional politician, but assuming the Presidency, he became
highly transformational. He framed American global participa-
tion, decided on using the atom bomb in 1945 to end the war with
Japan and initiated N.A.T.O., the Truman Doctrine to defend
Greece, the Marshall Plan to bring about European recovery, the
massive airlift to fly over Soviet blockage of Berlin, and the
_£A_ Korean "police action." He used his power of office to dismiss
"^ America's most popular general—Douglas MacArthur—for the T7
latter's refusal to accept constitutional civilian control of the mili-
tary (Gardner, 1987).
SITUATIONS CAN MAKE SOME DIFFERENCE

Howell (1988) has offered a list of organizational and task
conditions which would be likely to affect the emergence of trans-
actional leadership as an exchange relationship and of transforma-
tional leadership as charismatic, inspirational and intellectually
stimulating. Table 3, adapted from her original, shows the organi-
zational and task characteristics she expects would generate high
or low frequencies of transactional or transformational leadership.
Given the behaviors involved in transactional and transfor-
mational leadership, one can also propose the task/goal con-
ditions, and characteristics of the subordinates and the leader
which are most likely to correlate with each component of
the Full Range of Leadership. For instance, as shown in Table 4,
laissez-faire leadership is most likely to emerge when the tasks
and goals are unimportant, the rewards are low, discipline is lax,
the subordinates are experienced and the leader is distracted,
indifferent and uncaring.
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Contingencies of Transformational/Transactional Leadership 55
TABLE 3
The Likelihood of Exchange and Charismatic Leadership Emergence
Under Different Environmental and Organizational Conditions
Situational Conditions Likelihood of

Exchange Charismatic
Leadership Leadership
Environmental
Stable High Low
Unstable Low High
Political/Legal High Low
Not Political/Legal Low High
Collectivistic Low High
Individualistic High Low
Organizational
Consistent With Cultural Values Low High
Inconsistent With Cultural Values High Low
Mechanistic High Low
Organic Low High
Reactive Processing High Low
<> Proactive Monitoring Low High <>
Hierarchical Authority High Low
Dispersed Authority Low High
Centralized Decision-Making High Low
Decentralized Decision-Making Low High
Vertical Communication High Low
Lateral Communication Low High
Task Characteristics
Standardized, Routine High Low
Complex, Changing Low High
Weil-Defined Performance High Low
Poorly-Defined Performance Low High
Goals
Ambiguous Performance Low High
Extrinsic Rewards High Low
Intrinsic Rewards Low High
Leader-Subordinate Relations
Leader Power Greater Low High
Follower Power Greater High Low
Leader Information Greater Low High
Follower Information Greater High Low
(Adapted from Howell, 1988)
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TABLE 4
Task/Goal Subordinate and Leader Conditions Fostering the
Emergence of the Full Range of Leadership
Charisma
Reinforcements/Tasks/Goals: Uncontrolled, conflict, stress
Subordinates: Inexperienced, low self-esteem, low self-efficacy
Leader: Realistically self-confident, determined, unconventional
Inspirational Motivation
Reinforcements/Tasks/Goals: Ambiguous
Subordinates: Inexperienced
Leader: Articulate, flexible, emotional, perspicacious
Intellectual Stimulation
Reinforcements/Tasks/Goals: Problems to be solved
Subordinates: Experienced, high
Leader: Rational, unconventional, perspicacious
Individualized Consideration
Reinforcements/Tasks/Goals: Unmet individual needs
-O Subordinates: Inexperienced, career-oriented
Leader: Caring, empathic, relations-oriented
-e
Contingent Reinforcement
Reinforcements/Tasks/Goals: Controlled by leader
Subordinates: Inexperienced, materialistic, not idealistic
Leader: Materialistic, conventional, not idealistic
Active Management-by-Exception
Reinforcements/Tasks/Goals: Objectively measurable
performance
Subordinates: Inexperienced
Leader: Task-oriented
Passive Management-by-Exception
Reinforcements/Tasks/Goals: Uncontrolled, controlled
by organization
Subordinates: Experienced
Leader: Reactive
Laissez-Faire
Reinforcements/Tasks/Goals: Unimportant
Subordinates: Experienced
Leader: Distracted, indifferent, uncaring
(Adapted from Howell, 1988)
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Bass Book 4-5 2/29/96 10:43 AM Page 57
^>
Some evidence to support the overall scheme is available.

For both non-professionals (Podsakoff, Niehoff, MacKenzie, &
Williams, 1993) and professionals (Podsakoff, Mackenzie, & Fet-
ter, 1993) investigators found some evidence that the effects
of transactional leader behavior were moderated by situational
variations. Similar to findings for blue collar workers, contingent
and non-contingent reward and punishment leadership and
instrumental and supportive leadership of 411 professional, man-
agerial and white collar workers accounted for 12% of the vari-
ance of the employees in their general satisfaction. Effects of the
leadership on satisfaction could be attributed to some extent to
differences in subordinate characteristics, differences in tasks, or
differences in organizational characteristics.
Environmental Contingencies
Among environmental variables of consequence to transfor-
mational and transactional leadership may be the environment's
stability or turbulence, and whether or not it is heavily politicized,
and whether it is heavily collectivistic or individualistic in culture.
Stability Versus Turbulence. More transactional leadership is .
-&- likely to emerge and be relatively effective when leaders face out -£}-
to a stable, predictable environment. More transformational lead-
ership is likely to emerge in organizations and be effective when
leaders face an unstable, uncertain, turbulent environment. For
Ansoff and Sullivan (undated), turbulence in the environment is
characterized by complexity, lack of familiarity to the leadership
of likely events, rapidity of change and lack of visibility of the
future. The leaders' strategies for coping with the environment
require that they match their organization and their behavior with
the level of environmental complexity. The five levels of stability-
turbulence posited by Ansoff and Sullivan give rise to the sugges-
tion as to how much transactional or transformational leadership
would be required to match the environmental demands.
The repetitive environment without change calls for stable
reactions based on precedents—mainly transactional leadership.
The slowly expanding, incrementally changing environment
requires leaders who use experience to react to changes—again
the reaction of active management-by-exception appears adequate.
The leader has to become more anticipatory or somewhat transfor-
mational as the environment changes more rapidly. As change
becomes discontinuous the leader must seek opportunities
for change. Finally, when the environment is surpriseful, novel
strategies and creativity need to be intellectually stimulated.
-(>
Bass Book 4-5 2/27/96 1:14 AM Page 5E
&
Some Recent Unpublished Empirical Findings. The Center

of Leadership Studies is gathering data on Multifactor Leader-
ship Questionnaire scores as used under various contingencies.
Results for several thousand cases comparing stable and unstable
environments were in line with expectations. As shown in Table 5,
transformational leadership means were higher in unstable envi-
ronments. Transactional managing-by-exception was slightly
higher in stable conditions.
Emergence and Effectiveness of Transformational Leader-
ship. Leaders may create the contingent conditions requiring their
leadership. Pseudotransformational leaders may actively generate
the need for their charismatic leadership by manufacturing envi-
ronmental crises (Willner, 1984). But transformational leaders
may effectively deal with environmental problems. Employees
may come from populations that are indifferent or disenchanted
with their lot. When organizational members experience alien-
ation or anomie in the existing social order, Boal and Bryson
(1988) suggest that transformational leaders may emerge to create
a new and different world that links the members' needs to
important purposes, values and meanings. Such inspirational
<> leaders articulate a compelling vision. The leaders can show how
the followers behavior can contribute to fulfillment of those pur-
-e-
poses, values and meanings.
TABLE 5
Effects of Stable and Unstable Environments on Scores
Stable Unstable
Charisma 2.2 2.6
Inspirational Motivation 1.7 2.1
Intellectual Stimulation 2.0 2.4
Individualized Consideration 2.3 2.8
Transactional Leadership
Contingent Reward 1.7 2.0
Managing-by-Exception 2.3 2.2
(Adapted from Bass, Avolio, & Atwater, in press)
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As we have noted in Section 3, conditions of crisis, uncer-

tainty, and turbulence make the emergence of charismatic leader-
ship more likely than would occur in stable, routine conditions
(Bass, 1985). For example, a work by Robert House (1995)
reported, as expected, that the tendency for the charisma of 24
entrepreneurial CEO's to correlate with the commitment of their
followers depended on the uncertainty of the environment. The
correlation was .16, .00, .26, and .06 in four successive years
when the environment of the CEO's was low in uncertainty for a
subset and was .36, .47, .38, and .52 when it was high in uncer-
tainty for another subset in those same years.
Inspirational leaders may reframe opportunities so that the
environment is transformed from a situation of threat into a situa-
tion of opportunity into which the leader is followed. The envi-
ronment threatening General Electric was converted by Jack
Welch, CEO, into General Electric's need to compete worldwide
and to quickly and creatively exploit changes in market condi-
tions and technology. He restructured and reoriented the corpora-
tion towards a vision of speed, simplicity and self-confidence
^ (Howell, 1988). "We have a real opportunity to shift from a (trans- ,
Tp~ actional) mode where we control, measure, catch, snitch, and ~(J)-
follow, to (a transformational) one where work is exciting and
people feel empowered and energized to grow and create"
(Welch, 1989, p. 3).
Nothing has been tested so far about how the politicized
environment, such as in the late Soviet Union, increased the ten-
dency to be transactional. But, transformational appeals that
appear in heavily ideological and socially-oriented environments
are likely to emerge more frequently.
Collectivistic Societies. In an unpublished paper, D. I. Jung
(undated) argued that more transformational leadership was
likely to emerge in a collectivistic society than in an individualis-
tic one. To begin with, in collectivistic societies, people tend to
view their group and organization as an essential part of their
lives (Hofstede, 1991). Consequently, they are more attached to
their groups, organizations and societies than are those in indi-
vidualistic societies. They are more willing to subordinate their
self-interests for the sake of their larger collectives (Triandis,
1993). Emphasis is on group accomplishment. Individual aggran-
dizement is a threat to the collective. Depending on group perfor-
mance for goal attainment, there is commitment to more long-
<>
Bass Book 4-5 2/27/96 1:16 AM Page 60
<>
term goals. Such commitment is seen as the dimension of Confu-

cian dynamism (Hofstede & Bond, 1988) prevalent in Japan and
among the "five tigers" of South Korea, China, Taiwan, Singapore
and Malaysia.
Group norms and values are more strongly adhered to and
therefore provide a more powerful social control mechanism.
Deviant behavior is less tolerated. At the same time, in collectivist
cultures, individual attitudes and personality are less likely to be
correlated with explicit behavior. There is little need for theories
that explain leadership in terms of personality contingencies in
collective cultures. Group harmony, particularly, in-group har-
mony, is prized along with individual modesty (Triandis, 1993).
Goal attainment depends on group collaboration. Exchanges are
particularistic, such as involving the exchange of status for
love and service. They are less likely to involve universalistic
exchanges such as money for information and goods. The organi-
zation is likely to be viewed as an extended family in which
paternalism provides in-group harmony (Markus & Kitayama,
1991). Promotion is based on seniority. There is a strong attach-
ment to the organization and individual goals are readily subor-
<> dinated for the sake of the group ones. Work values are central.
Most employees have a long-term relationship with the organiza-
-e-
tion which first provides them with a full-time job when first
hired; their interpersonal skills are viewed as more valuable than
specific job knowledge and techniques. In-group solidarity is
stressed (Lee, Yoo & Lee, 1991).
Management controls depend on group norms and social
values rather than written rules. Followers can more easily iden-
tify themselves with the leader based on a mutual belief in a com-
mon purpose and when the followers already are group-oriented.
Thus, the work teams within a Japanese organization were seen
to have clearer identities and shared view of events than groups
of workers reporting to the same supervisor in the West. As a con-
sequence, Jung has proposed four explanations about the more
ready emergence and facilitation of transformational leadership
in the collectivist societies of East and Southeast Asia. Char-
ismatic leadership is facilitated because of the ordinary high level
of respect, trust, loyalty and obedience to higher authority of the
paternal father-figure. Followers already have a sense of shared
fates with their leaders and organizations. Inspirational moti-
vation is facilitated in collectivist cultures because followers
already are committed to collective accomplishment, group goals,
^>
Bass Book 4-5 2/29/96 10:44 AM Page 61
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and the meaningfulness of their own participation. The transfor-

mational realignment of individual values is accomplished by
realignment of the group's values. Thus, inspirational leadership
is easier to bring about in a collectivistic culture because already
present is a willingness to put forth extra effort on behalf of the
organization and a high level of commitment to the collective
accomplishment.
While the creativity of individual followers may be inhibited
in collective societies, the long-term strategies of the leadership
for the collective may enhance the patience required to achieve
success with products, systems and long-term goals. Furthermore,
the willingness of the leaders to turn their groups toward adapting
and improving upon Western technologies is illustrative of intel-
lectual stimulation. The avoidance of things "not-invented-here"
in Britain resulted in one year alone, in the 1970's, of Britain
exporting 14 times more patents than it imported. The reverse
was true for Japan. Yokochi (1989) found a high level of intellec-
tual stimulation in the MLQ ratings of 135 senior managers in 17
large Japanese firms. The Japanese leaders' strong emphasis on
intellectual stimulation was explained by Yokochi as due to the ,
v7~ Japanese culture which values lifelong, continuous learning and -£}-
pursuit of intellectual activities.
Individualized consideration is also important and relevant
in collectivistic cultures, making it easier to effect. There is much
paternalism. Leaders have personal responsibility for caring for
their followers' career development and personal problems
(Steers Shin, Ungson, & Nam, 1990). As expected, MLQ ratings
by their subordinates of the individualized consideration of
senior Japanese managers were high compared to the results
found in Europe and the U.S. As noted earlier, particularistic
exchanges of affection, emotional attachment, status and service
are more common. Hence, there is frequent use of individualized
consideration to help followers reach collective goals.
The leader-member exchange that has been tradi-
tionally based on emotional engagement and leaders'
individualized consideration to their followers has been
taken for granted in collectivistic cultures.... (The strong
vertical interdependence in collectivistic cultures)...
imposes a moral responsibility on the leaders to listen to
and share followers' concerns and on the followers to
pay back their indebtedness by meeting leaders' expecta-
tions. (Jung, undated)
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&
Organizational Characteristics
As with the collectivistic culture in which charismatic lead-
ership emerges more easily because of its consistencies with the
values of the culture, so in the West as well as in the world in
general, if the organization's mission is consistent with the domi-
nant values of society, leadership within the organization is facili-
tated. Shamir, House & Arthur (1993) note that in the U.S. we are
likely to see more opportunities to join high tech industries whose
tasks can be linked to the U.S. societal values in scientific and eco-
nomic progress. The tobacco industry would be a reverse setting.
When performance goals can be clearly specified, transactional
leadership is more likely to emerge (House, 1971). Conversely,
charismatic and inspirational leadership is more relevant when it
is more difficult to specify goals and measures of progress and
when extrinsic rewards cannot be linked to specific performance
so that contingent rewarding can be readily employed. Section 3
has noted the extent to which stress and crisis are contingencies of
consequence to transformational leadership's emergence.
Mechanistic Versus Organic. Burns and Stalker (1966) origi-
(t) nated the now well-accepted distinction between the mechanistic (\\
^ and the organic organizations. The mechanistic organizations
feature bureaucracy—elaborate control systems and strong
hierarchies. The organic organizations feature decentralized
decision-making and adaptive learning. We expect that managing-
by-exception would be easier to pursue in mechanistic organiza-
tions and transformational leadership and contingent rewarding
will emerge more frequently in organic organizations (Bass,
1985). Mechanistic organizations discourage change and inhibit
individual differences, motives and attitudes (House, 1992),
making managing-by-exception easier to accomplish.
Organic organizations are open to more variation and
experimentation with attendant greater risk-taking, fitting better
the prescription for transformational leadership. Mechanistic
organizations work better in stable, predictable environments.
Organic organizations work better in unstable, uncertain, turbu-
lent environments.
&
Bass Book 4-5 2/29/96 10:49 AM Page 63
<>
Military Versus Civilian Organizations. An unpublished

meta-analysis (Lowe, Kroeck & Sivasubramaniam, 1994) of 32
published studies completed a specific comparison of 947
military MLQrespondents with 577 to 2,141 civilian counterparts
describing their superiors. Table 4 displays the mean differences
in correlations obtained with outcomes in perceived effective-
ness, satisfaction and objective measures of performances. Over-
all, the correlations with objective outcomes and perceived
effectiveness are stronger in the military than civilian sectors. But
satisfaction with the leadership is about the same or slightly
greater in the civilian sector.
The mean correlation with objective performance of the MLQ
transformational factor scores ranged from .46 to .57. The compa-
rable results for civilians ranged from .26 to .29. For the military,
objective performance correlated .46 with contingent reward,
.46 with objective performance, .26 with active management-by-
exception and .32 with passive management-by-exception. The
comparable correlations for civilians were .20, -.27, and .07. Sim-
ilar patterns emerged when perceived effectiveness was the crite-
rion outcome. Military transformational leadership correlated
O .51 to .75 with effectiveness and satisfaction correlated .52 to .71. <>
For civilians, the figures were from .47 to .72.
TABLE 6
Significant Military-Civilian Differences in Outcomes
Correlated With MLQ Factor Scores
MLQ Factor Scores Objective Perceived Satisfaction

Perfomance Effectiveness
Transformational Mil. Civ. Mil. Civ. Mil. Civ.
Charisma .53 .28 .75 .57 .71 .72
Intellectual Stimulation .46 .26 .51 .47 .52 .56
Individualized Consideration .57 .29 .59 .48 .58 .61
Transactional
Contingent Reward .46 .20 .46 .50 .46 .58
Management-by-Exception
Active .26 -.27 Differences Differences
Not Significant Not Significant
Passive .32 -.07 Differences Differences
Not Significant Not Significant
(Data from Lowe, Kroeck, & Sivasubramaniam, 1994)
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Bass Book 4-5 2/27/96 1:25 AM Page 64
~Q-
Leaders of Groups With Diverse Membership. Based on

interviews with over 200 employees in 20 organizations, the
importance of transformational qualities in those responsible for
leading multicultural groups was noted. They are inspirational
in that they envisage and support diversity at all levels in their
organization. They use symbols and traditions to attest to the
value of diversity.
Their individualized consideration is built upon their
knowledge of multicultural issues, the adaptability of the lan-
guage they use to communicate to their diverse followers and
their focus on respect for cultural differences. They encourage
criticism from their followers. They are ethically and morally
committed to fairness. They openly advocate the elimination of
ageism, ethnocentrism, racism, sexism, etc. They mentor, coach,
and empower their diverse followers, providing them with oppor-
tunities of making use of their unique competencies.
Task Characteristics of the Situation

While much survey and experimentation has been com-
-0- pleted on whether task or relations-oriented and directive or par- _z^_
^ ticipative leadership emerges and is successful and effective in ^
structured versus unstructured task situations as well as other
task characteristics, little has been done so far to suggest whether
transactional or transformational leadership fits better with one
kind of task situation compared to another. We can point to two
independent studies of consequence by Moss (1992) comparing
work versus study groups and by Keller comparing research and
development groups at different phases of product development.
Work Versus Study Groups. Moss (1992) asked 188 New
Zealand subordinates of 63 workplace leaders to rate the leaders
using the Multifactor Leadership Questionnaire (Short Form 8A).
Then 44 of these same leaders were rated again by their 196 peers
in university study groups. Similar frequencies of mean contin-
gent rewarding (2.3 and 2.1), active management-by-exception
(2.3 and 2.5) and passive management-by-exception (2.2 and 2.3)
were obtained for leadership displayed in the university study
groups and the work groups respectively. However, some statis-
tically significant mean differences emerged for the transfer-
&
Bass Book 4-5 2/27/96 1:26 AM Page 65
■e-
mational and laissez-faire factors: charisma (2.6 and 2.8), inspi-

rational motivation (2.2 and 2.6), intellectual stimulation (2.3
and 2.7), individualized consideration (2.2 and 2.7) and laissez-
faire (2.7 and 2.9) for the study and work groups respectively. Of
practical import in these different frequencies were the greater
amounts seen in the work groups in inspirational motivation,
intellectual stimulation, and individualized consideration.
More suggestive of the contingent effects was on the low cor-
relations between leadership scores in the study and work set-
tings obtained for the 36 to 40 leaders for whom complete data
were available: charisma (.30), inspirational motivation (.30),
intellectual stimulation (.27), individualized consideration (.08),
contingent reward (.02), active management-by-exception (.17),
passive management-by-exception (.10) and laissez-faire leader-
ship (.08) even when corrected for attenuation of the scales due to
the estimated unreliability of the short forms.
Research Versus Development. A specific example of a task
contingency was uncovered by Keller (1992) in the differential
degree of effectiveness of transformational leadership in the
_^:^_ research and development of a product. He studied 66 project _£X.
^ groups containing 462 professional employees from three indus- ^
trial R&D organizations. Transformational factors of charisma
and intellectual stimulation of the project leaders were measured.
Overall, these factors predicted the quality of the projects
completed and the tendency to meet budget and scheduling
requirements as evaluated by both the team members and higher
management. At the same time, the effects of the transformational
leadership on project quality was greater for those R&D groups
engaged in research than those R&D groups engaged in the
product development that followed. The effects of the transforma-
tional leadership were contingent on the stage of research or prod-
uct development in which a project team was involved.
-£>
Bass Book 4-5 2/27/96 1:28 AM Page 66
O
Leader-Subordinate Relations
Using small space analysis, it was shown that whether a
leader was directive or participative depended on whether the
leader or the subordinate had the information and power in the
situation. It can only be a matter of speculation at this time but it
is expected that whether the leader has the power and inform-
ation, transformational leadership is likely to emerge. Where the
follower has the power and information, it behooves the leader to
try to negotiate an exchange.
We need to differentiate between the leadership that will
emerge to succeed in influencing followers and the leadership
that will be effective resulting in meeting the mutual needs of the
leaders and followers.
A leader will be transformational when he or she provides
coaching, special labor-saving ideas, emphasis on quality perfor-
mance and the role of the employee in the large organizational
picture. A leader will be transactional when he or she clarifies
what needs to be done and the rewards for doing so or the correc-
tions necessary to accomplish the tasks. What differentiates trans-
■e- actional from transformational behavior can suggest potential -^>
contingencies.
In sum, the transactional and transformational leader relates
differently to colleagues as follows:
Transactional Transformational
Caters to self-interests Transcends self-interests
Works within the Works to change the
organizational culture organizational culture
Plans Envisions
Promises and rewards Builds self-esteem and confidence
Disciplines and corrects Enables, coaches, mentors
Controls Empowers
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O
LEADERSHIP CONTINGENT OR ONE BEST WAY?
Theory and research support a variety of contingency theo-

ries of leadership. Well-known is Fiedler's (1967), which explains
that task oriented leaders are most effective when faced with
highly unfavorable or highly favorable situations. Relations-
oriented leaders do best when situations are in-between in favor-
ableness. Esteem and power of the leader and structure of the
situation contribute to the favorableness of the situation to the
leader. Equally researched is House's path-goal theory. The effec-
tive leader clarifies the transactional exchange, the path the
subordinate needs to follow for goal attainment. Contingencies
include the motivation and expectancies of the subordinate
and the structure of the situation.
Numerous other situational leadership theories such as
those of Hersey and Blanchard (1969), Vroom and Yelton (1973)
posit different leadership and decision styles for different kinds
of situations. Nevertheless, despite the vast array of contingent
findings, overall the best of leaders are described as those who
integrate a highly task-oriented and a highly relations-oriented ,
-
vT approach (Bass, 1990a). The best of leaders demonstrate their -(in-
ability to clarify the path to the goals. To date, there has been the
general findings likewise that the best of leaders are both trans-
actional and transformational. Although Bass (1985) speculated
on the individual and organizational constraints that would be
conducive to more transactional or more transformational leader-
ship, few empirical studies have been attempted. So far, there is
considerable evidence that those leaders described by their fol-
lowers as more frequently transformational are likely to be both
subjectively and objectively more effective and satisfying than
those more frequently transactional leaders who exchange
promises of rewards for appropriate role enactment by subordi-
nates. In turn, such more frequently reward-oriented leaders are
more effective and satisfying than those who more frequently
manage-by-exception or are laissez-faire and abdicate their lead-
ership responsibilities (Bass & Avolio, 1990).
Suppose we were to ask what particular leadership behaviors
would be most likely to emerge and to be most effective in dif-
fering circumstances. Would a contingent model be in order?
For example, by definition, charismatic leaders are expected to
emerge in times of crises. If the same leader and group underwent
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Bass Book 4-5 2/26/96 9:29 AM Page 68
-Q-
alternating periods of stress and steady-states, would more

transformational leadership emerge in crises conditions and more
transactional leadership in steady states? Would the leader be
most effective and satisfying if he matched the stress-no stress sit-
uation with transformational leadership under stress and transac-
tional leadership with no stress? Or would it be a matter of being
just a bit more of one than the other when conditions changed?
In ongoing organizational life, transformational leadership
generally has its impact regardless of situational circumstances.
The hierarchy of effects that transformational leadership is most
effective, contingent reward next most effective, managing-by-
exception next most effective and laissez-faire leadership is least
effective holds regardless of contingencies. But, contingent condi-
tions affect whether or not transformational or transactional lead-
ership is most effective. The empirical question is whether the
effects are more than marginal and have practical consequences
for selection, training, development and placement. Does the best
leadership use both in varying amounts over any given period
of time?
r^_ Consider the following scenario: A service supply company _z:\
hires unskilled labor for the simple tasks of cleaning offices. A
contingent model would suggest that for supervising such simple,
unskilled work with less educated employees, transactional
leadership emphasizing contingent rewards and management-
by-exception is most likely to be necessary and effective. Never-
theless, one cleaning firm has found great payoff from treating the
employees as if they were well educated professionals. Inspira-
tional leadership in the firm's management provides the cleaners
with meaning and challenge in their work and commitment to it.
Intellectual stimulation promotes their creative improvements
of how the work can be done better. Individualized consideration
focuses on their individual needs for personal recognition and
improvement. All this is added to the extrinsic contingent
rewarding of contests and prizes for performance. So on the one
hand, contingent theory would support a transactional approach.
Yet, as is generally true if there is investment in transformational
leadership, it still adds considerably to the effectiveness of the
less frequently needed transactional leadership. This augmenta-
tion effect was hypothesized by Bass (1985) and demonstrated by
Waldman, Bass and Einstein (1985).
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Bass Book 4-5 3/3/96 6:45 PM Page 69
G~
SECTION 5
Transformational and Transactional

Organizational Culture
Introduction
The organizational culture is a learned pattern of behavior,
shared from one generation to the next (Deal & Kennedy, 1982). It
includes the values and assumptions shared by members about
what is right, what is good, and what is important. Shared in
addition are heroes, stories and rituals that provide expressive
bonding of the members. Organizational culture is the "glue" that
holds the organization together as a source of identity and dis-
tinctive competence (Bass, 1991). In an organization's decline, its
culture can become a constraint on innovation because of its roots
-Q- in the organization's past. _r^_
Can organizational cultures usefully be described in terms of
how transactional or transformational they are? The shared values
within the organization persist over time, shape the norms and
behavior of the groups and individuals within the organization
and its reputation among insiders and outsiders. The organiza-
tional culture is maintained by its traditions even as the members
change. Elite military forces such as the Green Berets, the British
Life Guards or the Israeli Commandos illustrate those with strong
cultures as do firms in the period between 1976 and 1986 such as
Exxon and Motorola.
Leadership and Organizational Culture

Founders often create an organizational culture from their
preconceptions about an effective organization. The founders'
and successors' leadership shape a culture of shared values and
assumptions, guided and constrained by their personal beliefs.
69
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The organization's survival depends on how well those beliefs

match up with the organization's continuing opportunities.
Organizational culture and leadership interact with each
other. Leaders create and reinforce norms and behaviors within
the culture. The norms develop because of what leaders stress as
important, how they deal with crises, the way they provide role
models, and whom they attract to join them in their organizations.
An organizational culture affects its leadership as much as its
leadership affects the culture. If an organizational culture has in
place values and guides for autonomy at lower levels, manage-
ment will be unable to increase its personal powers. Decisions
about recruitment, selection, and placement within the organiza-
tion will be affected by the organizations values and norms.
Leaders need to be attentive to the rites, beliefs, values and
assumptions embedded in the organizational culture. They can
help or hinder efforts to change the organization, when it must
move in new directions as a consequence of changes in the inter-
nal and external environment of the organization.
-Q- Transformational Organizational Culture _^>

In adaptive, innovative and satisfying organizational cultures,
we are likely to see transformational leaders who endorse
assumptions such as people are trustworthy and purposeful.
Complex problems can be delegated to the lowest level possible.
The leaders articulate a sense of vision and purpose to followers.
They align the followers around the vision and empower others to
take responsibility for achieving portions of the vision. When nec-
essary the leaders become teachers; personal responsibility is
accepted by the leaders for the development of their followers to
their full potential.
Adaptive Organizational Cultures. When the organizational
culture fits with the demands on it, it is more likely to be effec-
tive. When demands change, a strong culture may handicap the
organization's needed efforts to change. On the other hand, if the
culture is adaptive and flexible it will contribute to the organiza-
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Transformational and Transactional Organizational Culture 71
tion's effectiveness. Since demands on most organizations are

unlikely to be absolutely steady and stable, Kotter and Heskett
(1992) find that "only cultures that can help organizations antici-
pate and adapt to environmental change will be associated with
superior performance over long periods of time" (p. 44). The
adaptive culture of Kotter and Heskett parallels what Avolio and
Bass (1994) designated a transformational culture.
The 12 adaptive firms during the period between 1976 and
1986, studied by Kotter and Heskett, all seem to have been
originated by a transformational founder: Adolphus Busch at
Anheuser-Busch, C.R. Smith at American Airlines, Sam Walton at
Wal-Mart, Marion and Herbert Sandier at Golden West, Charles
Sanford at Bankers Trust, Donald Kendall at PepsiCo, William
Hewlett and David Packard at Hewlett-Packard, Michael Harper
at Con-Agra, Joseph Albertson at Albertson's, the Daytons at
Dayton Hudson, and Elliot Springs at Springs Industries.
In contrast to the leaders in most of the unadaptive firms, the
leaders of the adaptive firms
^ ...got their managers to buy into a timeless philoso- ,
~^^ phy or set of values that stressed both meeting con- ~^)"
stituency needs and leadership or some other engine for
change—values that cynics would liken to motherhood,
but that when followed can be very powerful. Those
people and their successors then perpetuated the adap-
tive part of their cultures—the values/philosophy part
relating to constituencies and leadership—because they
worked at it. (p. 55)
Preserving the adaptive culture was deliberate. The trans-
formational leaders and their successors saw themselves as
custodians of the corporate culture, as preserving the firm's core
values, writing and speaking about them frequently. They hired,
promoted, rewarded and disciplined people consistent with the
core values of their adaptive culture. New systems that were
introduced needed to be adaptable.
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Transactional Organizational Culture

In the transactional organization the leadership accepts no
deviation from standard operating procedures. It manages-by-
exception and rewards followers contingent on their correct
application of the rules. The organization is likely to be highly
mechanistic rather than highly organic.
Unadaptive Organizational Cultures. Kotter and Heskett's
(1992) unadaptive culture mirrors how Bass and Avolio defined
a transactional culture. Three components were identified by
Kotter and Heskett in the firms with unadaptive cultures. First,
the firms' managements had a dominant position in their markets
and were seduced by their prior success in growth and profits. For
instance, during the 1976-1986 decade, at Texaco, there was no
encouragement to look outside the firm for better ways of doing
things. Second, the managements did not value their customers,
stockholders and employees. At Coors, when customer com-
plaints were received about opening their cans, the response was
that Coors produced the best beer available; the complaining
customers would find a way to get to the beer inside the cans. The
rh third component was hostility to leadership and change. Thus, fK
vjy
^ when executives at General Motors, Winn-Dixie, and Fieldcrest
Cannon showed "too much leadership" they were not promoted.
Kotter and Heskett suggested that adaptive firms change to
unadaptive ones as the leaders become only managers, or as
we would say, the mainly transformational leaders become
mainly transactional.
MODEL TRANSACTIONAL AND

TRANSFORMATIONAL CULTURES
A completely ideal transactional organizational culture and a

model transformational culture can be described by its members
and reliably measured. Within this framework, organizations are
likely to have cultures that vary from each other in combinations
of both models. Nonetheless, most organizations will benefit from
moving in the direction of more transformational aspects in their
cultures while also maintaining a base of effective transactional
tendencies.
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£>
Transactional Model
A model transactional culture concentrates on explicit and
implicit contractual relationships. Job assignments are in writing
accompanied with statements about conditions of employment,
rules, regulations, benefits, and disciplinary codes. The stories
that make the rounds repeatedly, the jargon used, the values
emphasized, the assumptions shared and the reinforcement
systems in the transactional culture usually set a price for doing
anything, "Everyone has a price." Motivation to work is a matter
of trade-offs of worker effort in exchange for rewards and the
avoidance of disciplinary actions. Commitments remain short-
term. Self-interests are underscored.
The partly transactional organization is an internal market-
place of individuals whose rewards are contingent on their
performance. Additionally, management-by-exception is often
actively practiced. Employees work independently. Cooperation
depends on the organization's ability to satisfy the self-interests of
the employees. The employees do not identify with the organiza-
tion, its vision or mission. Leaders are negotiators and resource
(t) allocators in which the power and politics behind a request fh
^ may be as important as its merit. Innovation and risk taking ^
are discouraged.
Transformational Model
In the model organizational transformational culture, there is
a sense of purpose and a feeling of family. Commitments are long-
term. Mutual interests are shared along with a sense of shared
fates and interdependence of leaders and followers.
Leaders serve as role models, mentors and coaches. They
work to socialize new members into the epitome of a transforma-
tional organization culture. Shared norms cover a wide range of
behaviors. The norms are adaptive and change with changes in
the organization's environment. Emphasized are organizational
purposes, visions and missions. In this pure organizational cul-
ture, challenges are opportunities, not threats.
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^>
As with leadership, transformational culture can build upon

the transactional culture of the organization. The inclusion of
assumptions, norms, and values which are transformationally
based does not preclude individuals pursuing their own goals
and rewards. This can occur at the same time if there is an
alignment of individual self-interests with a central purpose and
there is accompanying coordination to achieve the integrated
goals. Leaders and followers go beyond their self-interests or
expected rewards for the good of the team and the good of the
organization.
FIGURE 3
Frequency and Percentage of Types of Cultures According

to the Organizational Description Questionnaire (ODQ)
Scores for 171 Leaders of Organizations
Transactional Mean Scores
-e- -14 to -6 -5 to +5 +6 to +14

■e-
+16 to +14 Predominately Moderately High-
Transformational Transformational Contrast
19 (11.1%) 32 (18.7%) 5 (2.9%)
Transformational Loosely Guided Coasting Contractual
Mean Scores 17 (9.9%) 46 (26.9%) 13 (7.6%)
17 (9.9%)
Garbage Can Pedestrian Predominately
1 (.6%) 17 (9.9%) Bureaucratic
21 (12.3%)
(From Avolio, & Bass, 1994)
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Measurement of the Organizational Cultures

The Organizational Description Questionnaire (ODQ) of
Bass and Avolio (1993a) is a 28-item survey questionnaire that
can be completed by members of an organization. Transactional
elements in the culture's assumptions, processes and expec-
tations are found in 14 items such as:
• You get what you deserve—no more, no less.
• Everyone bargains with everyone else for resources.
• Specific rules afford little opportunity for
discretionary behavior.
Transformational elements of the organization's culture are
presented in 14 items such as:
• People go out of their way for the good of the institution.
• Individual initiative is encouraged.
• We believe in trusting each other to do the right thing.
Parallel forms have been constructed. The ODQ generates a
Transactional Culture Score (TA) and a Transformational Culture
_^^_ Score (TF). Factor analysis of the responses of several hundred
~^3~ organizational members of 69 organizations has uncovered two ~&~
distinct factors, one transformational and the other transac-
tional. Only 2 of the items in each of the 14 comprising the initial
scores failed to correlate as intended highly with its own factor.
Respondents indicated whether each of the 28 statements were
true, false, or they couldn't say. Scores were +1 for true, -1 for
false and 0 for undecided. And so total transformational and
transactional scores for each respondent ranged from -14 to +14.
Coefficient alphas for the 14-item transactional scale were .60 and
.64 for 169 participants from almost as many different organiza-
tions and .64 for their 724 subordinates. The corresponding
alphas for the transformational scale were .77 and .69.
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Organizational Types
Organizations may be typed according to the mean scores
from respondents about the organizations as shown in Figure 3.
These types are described as follows:
A predominately transformational organizational culture
receives highly positive ODQ transformational leadership scores
and highly negative transactional ODQ scores from its members.
The organization is likely to be constantly discussing purposes,
vision, values and fulfillment. Absent are formal agreements and
controls which may make it difficult to be certain about what
people will do. Teamwork is accented.
Expressiveness is high as in highly functioning families. The
organization's structure is flat, loose and decentralized. It is infor-
mal, flexible, adaptive and dynamic. Highlighted is bottoms-up
decision-making and the encouragement of individual and
organizational growth and improvement. Creativity is high. Ques-
tions are raised continually about methods needed to achieve
more effectiveness. As transactional scores are extremely nega-
^ tive, newcomers and outsiders may have a problem knowing ,
v7~ what to expect. A collection of sensitivity training or self-help ""£)"
groups might be purely transformational. The Spanish Anarchists
of the past century fit much of the description as well. A company
"skunkworks" in which project developers are set off by them-
selves to carry on flexibly without much attention to the organiza-
tion bureaucracy is also illustrative.
The moderately transformational organizational culture
receives a transactional score which is less negative or somewhat
positive. The culture sets more value on agreements, exchanges
and rewards for performance. Here we have the organization
that is likely to be highly effective. On the one hand, it contains
the transformational qualities needed for extra effort, commit-
ment and satisfaction. Yet, it also may have enough transac-
tional structure to provide predictability of relationships and
requirements without falling into bureaucratic traps. Probably,
Kotter and Heskett's adaptive organizations are closest to this
organizational prototype.
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A high-contrast organizational culture receives high ODQ

ratings from respondents in transformational character coupled
with a similarly high level of ratings for transactional character.
There is a great deal of both transactional management and trans-
formational leadership but often with conflict over the best ways
to proceed. Much of the conflict is likely to be constructive. Trust
is available to maintain balance between the rule-based old ways
of doing things and the needed innovations. This is particularly
true where tradeoffs must be made between short-term gain
and individual rewards for the long-term benefit of the group
and organization.
The well-run small, elite military organization fits this high-
contrast type. Members are highly committed and extra effort
is normal. The leadership is highly transformational. At the
same time, the success of these elite forces depends on tight struc-
tures, highly predictable communication systems, etc. Examples
include the Navy Seals and the British SAS. The military acade-
mies also tend to have these high-contrast characteristics. .. .Elan
is combined with attention to the rules.
-Q- The loosely guided organization is one which is moderately rx.
T transformational but without much structure. It is an alliance of
members who are not strongly committed to the central organiza-
tion and are able to do what they please. A confederation of inde-
pendent states or allied military forces may fit this description.
A coasting organizational culture falls between the extremely
transformational and extremely transactional cultures. External
controls are balanced against efforts favoring self-control. Trans-
actional management and transformational leadership are moder-
ate in frequency. The organization coasts along and does not
optimize the use of its resources and opportunities. Although
there may be dissatisfaction with the old ways, changes are not
sought. This is the most commonly found organization. Members
feel that much more can be done, nevertheless the organization
fails to adapt to new realities until it is forced to. Detroit was
content to coast along into the 1980's making autos that failed
to match up with the quality that was provided by Japanese and
German competition.
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78
Highly transactional contractual organizational cultures and

bureaucracies are characterized as attending more to self-interest
than the interest of the organization, as such. Each member guards
his or her own turf. Short-term goals are the rule. There is much
attention to enforcement of agreements, codes, controls, direc-
tions, and standard operating procedures. The organization is
an internal marketplace in which much is negotiated according
to the rules and regulations. The organization's structure is tall,
tight, stable, mechanistic, and centralized. There is a clear top-
down chain of command. Employees have little discretion and
are monitored, driven, and controlled. The large civil service
agency is illustrative.
The somewhat mechanistic pedestrian organization is mod-
erately transactional with little or no transformational qualities.
Little gets done that is not a consequence of formal agreements.
Little change is observed. Risk taking is avoided. There is a
general sense of structure and procedure but it is less complex
and well-organized as in a true bureaucracy. The organization's
leaders are handicapped by having little discretion. Work is rou-
.. tinized. There is little commitment to the organization by either
~w the leaders or members. Many volunteer agencies tend to be
pedestrian, lacking the transformational qualities required to
O
arouse its members to extend themselves. Military forces that lose
their sense of purpose and relax their rules to allow more play
and less work become pedestrian organizations.
The "garbage can" organizational culture, so named by
March and Olsen (1976), tends to be lacking in either transac-
tional or transformational leadership, consensus is absent, and
everybody "does their own thing," so that the organization is a
garbage can of fruitless activities. Little cooperation among mem-
bers is observed. Agendas depend on who attends meetings and
the problems they personally have as they wait for an arena in
which to air their grievances. The organization is formless, con-
fused, shapeless, and without either clear purposes, values, or
clear rules and regulations. Interdepartmental faculty committees
often are such garbage cans in organization.
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RELATIONS OF ORGANIZATIONAL CULTURE TO

QUALITY IMPROVEMENT
The Organizational Description Questionnaire (ODQJ was

completed by 130 leaders from a variety of sectors, including
industry, education, and health care, and 877 of their subordi-
nates. The participants had volunteered and were mainly from
different organizations and a variety of levels in the organizations.
Organizational Culture and Organizational Effectiveness.
Twenty-seven additional questions were asked of the same com-
munity program respondents who had completed the ODQ about
their respective organizations. These 25 questions dealt with the
same issues of total quality improvement that corporation contes-
tants for the Malcolm Baldridge Awards must answer. The 27
questions clustered into five factors: organizational vision, infor-
mation sharing, quality assurance, customer satisfaction and
working with others. Table 7 shows the correlations between
ODQ ratings of transformational and transactional organizational
culture and the five quality improvement factors.
~^3~ As seen in Table 7, although the quality improvement means ~^~
for the program participants were almost the same as those of
their subordinates' describing the same organizations, the trans-
actional organization correlations for the subordinates correlated
a bit more negatively with perceived quality improvement (-.17,
-.12, -.11, -.13, -.12). Conversely, the somewhat stronger positive
connections of transformational cultures and quality improve-
ment were somewhat higher for the subordinates (.23, .23, .24,
.22, .17). In all, those organizations described as transformational
appeared more likely to also be seen as doing more to improve
their quality of production and service. Those described as trans-
actional seemed to be doing less (Avolio & Bass, 1994).
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A BAROMETER OF TRANSFORMATIONAL/
TRANSACTIONAL LEADERSHIP TRAINING
Eighty-seven of the just mentioned participants and 168 of
their subordinates used the ODQto describe their respective organ-
izations during training in the Full Range of Leadership Program
(Avolio & Bass, 1991) and again approximately six months to two
years later.
The trained leaders' perception that their organization was
transactional decreased from -3.72 to -4.40 from the first to the
second administration. The subordinates' perceptions back home
of their organization's transactional culture increased from -3.32
to -2.41 from the first to the second administration. The subordi-
nates saw more structure being introduced by their leaders which
the leaders did not see. On the other hand, there was strong
agreement about the increase in transformational qualities in
the different organizations. For the leaders, mean organizational
transformational scores rose +6.80 to +10.41; for the followers, the
comparable scores rose from +6.60 to +8.70. The changes were
statistically significant as well as of practical importance since the
overall variations in the distributions of scores tended to be small.
-£> As a whole, the scores were concentrated on middle-of- the-range <y
"coasting" (Avolio & Bass, 1994).
TABLE 7
Relations Between Transformational and Transactional
Organizational Culture and Quality Improvement According
to 130 Community Leaders and Their 877 Subordinates
Program Subordinates
Participants of Participants
N = 130 N = 877
Culture: T'ract Tr'form Tr'act Tr'form
Amount of
Quality Improvement
Organizational Vision -.07 .21 -.17 .23
Information Sharing -.08 .15 -.12 .23
Quality Assurance -.12 -.11 .11 .24
Customer Satisfaction -.11 .17 -.13 .22
Working With Others -.04 .06 -.12 .17
(Data from Avolio & Bass, 1994)
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SECTION 6
Transformational and Transactional

Leadership of Men and Women
Introduction
Revealed wisdom supported by commentary and research
suggested that in order for a woman to succeed in the world of
work, a "man's" world, she had to adopt masculine behaviors
and attitudes (Brenner & Bromer, 1981; Kruse & Wintermantel,
1986). Women were believed to be promoted for their demonstra-
tion of the masculine virtues of ambition, competitiveness and
task orientation. Accordingly, successful women executives were
thought to have adopted male characteristics through training or
socialization, while progressing upward in the organization.
-Q- Although few women were expected to penetrate the glass ceiling _£X
and enter the top ranks of management (Van Velsor, 1987), the
successful 40 year old woman manager was expected to behave
no differently as a leader than her 40 year old male counterpart
who is a rising star in the organization (Denmark, 1977; Osborn &
Vicars, 1976).
But there were counterarguments about what it takes to be
"successful" leaders. First, regardless of their sex, the best leaders
were characterized over the last forty years as those who inte-
grated their task- and relations-orientation in their behavior
toward their colleagues and direct reports (Bass, 1990; Blake &
Mouton, 1964; Hall, 1976; Misumi, 1985). At the same time, task-
orientation was seen as more of a masculine trait, while relations-
orientation, particularly evidenced in nurturing, consideration,
and caring, was regarded as more feminine (Eagly & Crowley,
1986; Eagly, Mladinic, & Otto, 1991). The balancing required of
task and relations-orientation led to the proposition that the best
leadership may be found in androgynous attitudes and behavior.
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A Woman's Way May B5e Different. Rosener (1990) declared

that there is a woman's way of leading which differs from the
traditional masculine approaches. Helgesen (1990) agreed, argu-
ing that women leaders were more likely to structure flatter
organizations and more likely than men to emphasize frequent
contact and sharing of information in "webs of inclusion."
Barbara Grogan, owner of Western Industrial Contractors, is illus-
trative. She maintains no hierarchy and she feels no one is the
controller of information and power in her organization (Holusha,
1991, p. 1).
Eagly (1991) provided empirical evidence of consistent dif-
ferences between males and females in leadership styles, particu-
larly in that women leaders tend to be more democratic and
participative than their male counterparts. "Women evidently
proceed with more collaboration and sharing of decision-making
(p. 16)." Nevertheless, the empirical differences between male
and female leadership styles, although present, are small in effect
and moderated by organizational factors (Eagly, 1987). For exam-
ple, women were seen as more task-oriented than their male
counterparts in occupations such as nursing.
EVIDENCE OF DIFFERENCES IN
TRANSFORMATIONAL LEADERSHIP
Anecdotal, survey and experimental evidence all point to the

somewhat greater tendency for women in leadership positions to
be somewhat more transformational and to display less man-
aging-by-exception than their male counterparts. Concomitantly,
they are seen by their subordinates and colleagues as slightly, but
significantly, more effective and satisfying as leaders.
Anecdotal Evidence
In 1985, in an early training workshop on transformational
leadership, composed of 12 women and 12 men in upper levels of
management of a Fortune 50 firm, I observed during a survey
feedback session some potentially intriguing sex differences
in transformational leadership ratings. Three to five subordinates
had described each of these 24 leaders using the Multifactor Lead-
ership Questionnaire (Form 5R). The profiles for each leader were
identified by code numbers only. In the workshop exercise, with-
out knowing their names or sex, I selected the four of the 24
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Bass Book 6-7 2/26/96 9:45 AM Page 83
-Q-
managers with the highest MLQ charismatic leadership scores,

which accounts for the greatest percentage of variance in trans-
formational leadership (Bass, 1985) to participate in a team exer-
cise. The probabilities were that two of the 24 would be men,
although stereotypes and the literature until then would have sug-
gested that all four would be men (see, for example, Kruse &
Wintermantel, 1986). However, contrary to expectations, all four
top-rated charismatic leaders were women, and by a sizable mar-
gin. During the exercise, I observed their unusual competencies,
presence and self-confidence.
New Zealand Survey Evidence

Clearly, the unexpected anecdotal result could have been due
to chance. Nevertheless, this pattern was consistent with results I
had found previously in New Zealand with two samples of lead-
ers. In a study completed in 1984, 23 New Zealand educational
administrators were all evaluated by their direct reports using an
earlier form of the MLQ (Form 4). Women supervisors were rated
higher on each of the four respective transformational leadership
components compared to their male counterparts (Bass, 1985,
-$- p. 226). -$-
A similar pattern was found for transformational leadership
ratings for 45 New Zealand professional administrators and man-
agers (p. 223). Women leaders were rated higher on transforma-
tional leadership as compared to their male counterparts. At the
same time, men were found more likely to practice management-
by-exception.
CLS Survey Evidence

Multifactor Leadership Questionnaire (Form 5) data from
four separate investigations gathered at the Center for Leadership
Studies (CLS) between 1986 and 1992 support the conclusion
that women display more transformational and less transactional
leadership (Bass, Avolio & Atwater, in press). In the first study,
the majority of leaders assessed—79 females, 150 males—were
middle to upper-level managers from six, mainly hi-tech, Fortune
50 firms. Subordinates who rated these managers—219 females,
658 males—were typically selected by the focal managers them-
selves. In the second study, MLQ data were gathered about 38
females and 58 male first-level supervisors. For the second study,
the subordinates—147 females and 124 males—who completed
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the ratings were selected randomly. For the third study, 154
female and 131 male focal leaders were drawn from not-for-profit
health care, social service, government, and other local agencies
as well as small businesses. These focal leaders selected their
own 532 females and 381 males as raters before participating in a
leadership training program for the leaders. In the fourth study,
the subjects—10 female and 36 male leaders—were superinten-
dents, principals and staff from public school districts who had
asked 81 female and 50 male direct reports to rate their leadership
styles.
Some of the differences favoring the women leaders in trans-
formational leadership were small and some failed in statis-
tical significance as individual studies. Nonetheless, in all four
studies, the women leaders attained higher scores for all four com-
ponents of leadership: charisma, inspirational motivation, intel-
lectual stimulation and individualized consideration. The same
was true for contingent reward although the effects generally were
not statistically significant. As for management-by-exception and
laissez-faire leadership, no differences emerged between male and
female leaders except in the case of the first-line supervisors of the
~\.T~ second sample where, significantly, women more actively man- ~~&~
aged-by-exception and, significantly, men more passively man-
aged-by-exception—the reverse of any expectations based on
stereotypes about the behavior of women and men. Figure 4
displays the results of the first study and Figure 5 does the same
for the second study to illustrate the sex differences.
Women raters were more generally lenient in their MLQ
assessments of both men and women leaders but again, contrary
to expectations, whether the subordinate providing the MLQ
rating was a man or a women made no difference. Komives (1991)
similarly found that whether women or men resident assistants
reported to a person of the same or different sex made no differ-
ence in their view of supervisory leadership or satisfaction with it.
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Corroborative Survey Results

These results were supported by Druskat (1994) who com-
pleted an MLQ (Form 8Y) survey of 3,352 sisters, 1,541 brothers
and 1,466 priests in the Roman Catholic Church in the United
States. Form 8Y, a 40-item version of Form 5, was used. Respon-
dents were instructed to describe the person or group in their
congregation to whom they considered themselves accountable.
FIGURE 4
Mean Differences Among Men and Women Managers
in MLQ Scores When Rated by Subordinates
(STUDY 1)
LEADERSHIP SCALE Men Higher Women Higher

than Women than Men
TRADITIONAL IDEAL ■ ■ 1 i •
Charisma
K -39
Inspirational Motivation 1-21 -J
<> <>
Intellectual Stimulation m 1r19
Individualized Consideration .:.::: .: ■ 1 ■41
TRANSACTIONAL
Contingent Reward .18 ■;
Management-By-Exception
(Active) 08 ■
Management-By-Exception .3
(Passive)
Laissez - Faire .33

° ^■■H
•^
OUTCOMES
Extra Effort
^H
Effectiveness
frW25 ;
Satisfaction
■ ■ .33
(From Bass, Avolio, & Atwater, in press)
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Bass Book 6-7 2/27/96 2:02 AM Page 86
-Q-
Transformational leadership divided into a factor of charisma

combined with individualized consideration and an inspir-
ational-intellectual stimulation factor. Transactional leadership
factors which emerged were contingent reward, active manage-
ment-by-exception and a combination of passive management-by-
exception with laissez-faire leadership.
FIGURE 5
Mean Differences in MLQ Scores Among Men and Women
Managers When Rated by Subordinates
(STUDY 2)
Men Higher Women Higher

LEADERSHIP SCALE
than Women than Men
TRANSFORMATIONAL
Charisma .45
<>
Inspirational Motivation
-e-
Intellectual Stimulation
Individualized Consideration
TRANSACTIONAL
Contingent Reward
Management-By-Exception
(Active)
Management-By-Exception .25
(Passive)
(From Bass, Avolio, & Atwater, in press)
-&
Bass Book 6-7 2/29/96 11:15 AM Page 87
<>
As expected, for priests, brothers and sisters, all were rated

higher in transformational leadership than the norms for the
general population. However the female leaders were rated more
highly transformational in leadership by their collegial sisters
than were the male priests and brothers who were rated by their
male leaders as highly transformational. Thus, in the aggregate,
the sisters were rated more highly transformational than were
brothers and priests. At the same time, however, brothers and
priests earned higher transactional scores than did the sisters.
These findings are confounded by the fact that women
generally are more lenient raters and leniency correlates slightly
with assigning more transformational ratings and less ratings of
passive managing-by-exception (Bass & Avolio, 1989).
One discomfirming result was reported by Komives (1991).
Forty-three women residence hall directors appraised themselves
as less transformational, particularly on intellectual stimulation,
according to a comparison by Komives with 31 men also serving
as residence hall directors.
,. Self-Rated Leadership. Indirect corroboration was provided
~^7~ by Bachman and Gregory (1993). Mentoring is clearly an impor- ~~&-
tant aspect of providing individualized consideration. A survey of
1,736 Kaiser Permanente management employees by Bachman
and Gregory (1993) found women mentors were somewhat more
likely to provide role models for both male and female employees
and be somewhat easier to talk to. Further indirect corroboration
was seen in Air Force Academy data. Although only 5 of 40 U.S.
Air Officers Commanding (AOC's) rated as transformational and
transactional by 4,400 cadets at the Air Force Academy were
women, strong positive correlations were found between the
cadets' ratings and the AOC's self-assessments with an Adjective
Check List. Self-assessed feminine attributes of the AOC's corre-
lated .53 with cadet-assessed charisma and .54 with intellectual
stimulation. Self-assessed masculine attributes correlated -.11, -
.16 and -.04 respectively with the cadet-assessed transformational
scores (Ross, 1990).
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Bass Book 6-7 2/29/96 11:16 AM Page 8E
-(>
SOME POSSIBLE EXPLANATIONS
A variety of reasons have been offered on why women differ

from men in transformational leadership and may be more effec-
tive and satisfying as leaders.
Why the Differences in Transformational Leadership?

An explanation for the male-female differences in trans-
formational leadership may be due to the well-known tendency
for women, supported by the evidence, to be more nurturing
(Eagly, 1991). At the same time there is a strong component of
developmentalism in transformational leadership. By defini-
tion, transformational leaders focus on developing and raising
the awareness of their followers about the importance of satisfy-
ing higher order growth needs (Burns, 1978). Transformational
leaders also place heavy emphasis on differentiating among
the varying developmental needs of their followers. They
attempt to understand the needs of followers and then develop
them to higher levels (Bass & Avolio, 1990b). Providing indirect
support for this latter position, women leaders see themselves ,
-
vT on the Myers-Briggs Type Indicator as more "feeling" (Myers & ~Q~
McCaulley, 1985) than men do. Eagly & Johnson (1990) described
women leaders as more interested in others than their male coun-
terparts and as more socially sensitive. Women leaders appear to
display qualities more in line with transformational leadership.
Beyond this, they are also more likely than their male counter-
parts to attribute their transformational leadership to their rela-
tional qualities (Komives, 1991).
A conflict for woman leaders arises due to sex-role stereo-
typing. On the one hand many still believe that managers should
be aggressive, competitive and tough (Bersoff, Borginda & Fiske,
1991). But women leaders who behave this way are disliked and
create dissatisfaction among colleagues and subordinates (Eagly,
1991). District Attorney Marcia Clark, the prosecutor in the O.J.
Simpson case, is faulted for her "prosecutory" style!
Another reason for expecting women leaders to be more
transformational is the component of moral value in transfor-
mational leadership (Kuhnert & Lewis, 1987) and when reasoning
morally, women highlight responsibility and care; men, rights
and justice. Again, women may be more transformational as they
tend to be less self-serving authoritarians than men in leadership
style (Eagly & Johnson, 1990).
^>
Bass Book 6-7 2/29/96 11:18 AM Page 89
■e-
We cannot ignore some personality traits favoring transfor-

mational leadership in male leaders for, as with men in general,
transformational leaders are less conforming, more self-confident,
and more likely to take risks (Bass, 1985). Women generally are
more conforming, less self-confident and less likely to take risks
(Hennig & Jardin, 1977). In this regard, Hackman, Furniss, Hills
and Paterson (1992) showed in data from 71 men and 82 women
in New Zealand that both feminine factors and masculine factors
were positively correlated with perceptions of transactional and
transformational leadership. The investigators concluded that
transformational leadership required a "gender balance" rather
than the traditional leadership stereotype of masculinity.
Along with Rosener (1990) it seems reasonable to conclude
that women have a leadership style that differs from men. "The
view, widely accepted by social scientists, experts on leadership,
that women and men lead in the same way should be very sub-
stantially revised" (Eagly & Johnson, 1990, p. 248). Furthermore,
generally women are somewhat more transformational and as a
consequence are likely to be judged more effective and satisfac-
tory as leaders than their male counterparts.
-&
Why Women May Be More Effective and Satisfying as Leaders
-e
Artifactual Effects? There are arguments discounting the
empirical findings. For instance, it is suggested that for a woman
to attain the same leadership position as her male counterpart she
has to be more qualified. But, given poorly administered affirma-
tive action policies, the reverse could also be argued.
The numbers for women may be inflated by stereotyped
expectations that they will prove less adequate as leaders so raters
"lean over backwards" to give them higher ratings. Men may be
expected to live up to higher standards as a consequence of the
past stereotyping.
Given the positive correlations of transformational leader-
ship and effectiveness and satisfaction among those led, it follows
that if women are more transformational than their male counter-
parts they will be more effective and satisfying. But is this due to
artifacts or changes in requirements for leadership?
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Bass Book 6-7 2/27/96 2:03 AM Page 90
-e-
Organizational Requirements Have Changed. The facts

should not be discounted. While traditional hierarchical organi-
zations of the past may have required "masculine" leader behav-
ior, the flatter organizations of today may call for a more
"feminine" approach. Organizational cultures are increasingly
emphasizing "feminine" caring and concern for others without
diminishing the importance of completing the work to be done
(Offerman & Gowing, 1990). In the 1985 list of the 100 "best"
organizations to work for, as evaluated by members of each of
those respective organizations, many of the key organizational
characteristics differentiating the best firms from the total were
traditional "feminine" qualities (e.g., concern for the individual,
devoting ourselves to others, family orientation, sharing, being
helpful, and promoting collaboration). Women leaders may be
better suited for the organizational culture of the 1990's and
beyond. In the military, we are likely to see rising numbers reach-
ing higher levels of leadership and command.
<y <y-
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Bass Book 6-7 2/27/96 2:05 AM Page 91
O
SECTION 7
Implications of Transformational
Leadership for
Organizational Policies
Introduction
Fighting against superior equipment with far fewer men and
tanks than the British had, Ernst Rommel, the Desert Fox, won
a series of victories in 1941 and 1942 in North Africa, until
defeated at El Alamein. Usually, up front at the scene of the
action, he could make rapid assessments and decisions the British
command could not. Moreover, he took calculated risks to
achieve speed and surprise. His bold leadership contributed to
-CX- the continuing high morale of his forces.
-&
Leadership makes its presence felt throughout the organiza-
tion and its activities. We have found that not only is employees'
performance better when they believe their leaders are transfor-
mational, but they also are more satisfied with the company's
performance appraisal system (Waldman, Bass & Einstein, 1987).
In the same way, mass downward communications directed
toward all have a greater impact if the messages are reinforced
face-to-face by their supervisors (Dahle, 1954).
What are the implications of transformational leadership for
organizational policies? Where it is in short supply, transforma-
tional leadership should be encouraged, for it can make a big
difference in the organization's performance. Officers and non-
coms need to do more than focus on the exchange of material,
social, and personal benefits for adequate performance. The
charismatic leader, like the flamboyant George Patton, can instill
a sense of mission; the individually considerate leader, like
Omar Bradley, can lead soldiers to merge their self-interests with
higher-level concerns; the intellectually stimulating leader, Billy
Mitchell, can articulate a vision of possibilities. This is not to say
that transformational leaders are always prosocial in their efforts,
for some, like Napoleon, fulfill grandiose dreams at the expense
of their followers.
91
<>
Bass Book 6-7 2/27/96 2:06 AM Page 92
-e-
Unless it is already predominantly transformational, the

overall amount of transformational leadership in an organization
can be increased substantially by suitable organizational and
human resources policies. Transformational leadership at all
levels in a firm should be encouraged for it can make a big differ-
ence in the firm's performance at any level, not just with the top
leadership positions.
Transformational leadership presents opportunities for
improving the organization's image, recruitment, selection,
promotion, management of diversity, teamwork, training, devel-
opment, and education. It also has implications for the organiza-
tion's strategic planning, the design of its jobs and organizational
structure. Policies can be set in place which arrange for a desir-
able mix of transformational and transactional leadership in the
leadership displayed by the individual members of an organiza-
tion as well as in the norms, values, and culture of the organiza-
tion itself. As a consequence, various aspects of the organization
ranging from strategic planning to employee selection will be
favorably affected.
-Q- The Cascade. The cascading effect of transformational lead- _f\_
ership, particularly charismatic leadership, has a number of ^
implications (Bass, Waldman, Avolio & Bebb, 1987). Training in
transformational leadership must be provided at multiple succes-
sive levels of the organization, starting at the top. Engaging the
higher levels in the mentoring and coaching process would be
helpful. Higher levels would provide role models for lower levels.
...managers should be observant in noticing how
their behaviors and characteristics are being modeled to
ensure that their leadership is cascading effectively. For
example, a middle-level manager may demonstrate
transformational leadership to a subordinate, lower-
level supervisor by delegating important, challenging
work assignments and decision making. This lower-
level supervisor may, in turn, delegate important
assignments and decision making indiscriminately to
subordinates who are not willing or able to handle such
responsibility. The middle-level manager should pro-
vide the first-level supervisor with coaching as to how
and when delegation can be used effectively. However,
charismatic leaders...may come on "too strong" for some
or all of their best subordinates... charismatic first-level
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Bass Book 6-7 2/29/96 11:19 AM Page 93
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Implications of Transformational Leadership 93
supervisors require fewer charismatic qualities in their

own superiors. It may be useful to "tone down" one's
charismatic behavior particularly with those sub-
ordinates who are also deemed to be charismatic
themselves, (p. 85-86)
Implications for Strategic Planning

Whether the organizations are more transformational or
transactional will affect the openness and control of the flows of
information, the importance of organizational rules and proce-
dures, the centralization or decentralization of power, and the
bases of power (expert vs. legitimate vs. esteem), all of which are
likely to affect the organization's strategic planning.
Shrivastava and Nachman (1989) were able to categorize the
strategic planning observed in organizations into four clusters:
entrepreneural, bureaucratic, political and professional. It can be
seen that the transformational-transactional paradigm and the
individual and organizational levels could account for much of
what was found in the 27 organizations. In the entrepreneural
-£)- cluster, a confident, entrepreneural, energetic, knowledgeable _f\
individual "uses his personality and charisma" (p. 14) to set up
the roles for others and control their performance. Examples of
these individuals were Howard Head of Head Ski, Marcel Bick of
Bic Pen and John Connolly of Crown, Cork & Seal. Their busi-
nesses would most likely fit the high-contrast or moderately trans-
formational types we described in Section 5.
The second cluster was bureaucratic akin to our highly
transactional organizational type,
... strategic direction and thrust... is guided by... the
bureaucracy... standard operating procedures and poli-
cies shape the strategy... Members are accustomed to
adhering to existing rules and regulation.... They take
preassigned organizational roles as guides to behavior,
(p. 14,15)
Specified are the nature and amounts of information, the
kinds of analyses that must be completed, and the elaborate ratifi-
cation and authorization procedures that must go into problem-
solving and decision-making. Texas Instruments is cited as a
representative case.
<>
Bass Book 6-7 2/26/96 9:45 AM Page 94
&
94
The third cluster is political. Organizational decisions

emerge as a consequence of coalitions among the managers, each
with functional authority over some part of the organization.
Jointly negotiated interests and goals of a dominant coalition of
managers determine policies, strategies and plans. Again, much
transactional leadership is apparent. It can be collegial, construc-
tive and supportive such as in the case of Hospital Affiliates
closest to our contractual type of organization described in
Section 5 or it can be destructive and fragmenting as in the case of
the Saturday Evening Post where jockeying for the top position
and lack of control (more akin to our garbage can organization)
led to the demise of the organization.
The fourth cluster is professional, for instance, it includes an
R&D organization with a staff of professionally educated and
trained specialists whose influence depends on their expertise.
There is collegial maintenance of standards, identification with
professional peers, and concerns for autonomy and commitment.
Small groups devise their own procedures. "Strategy-making is
guided by...knowledge-based discourse..." (p. 17). Much of the
^ cultural character here is transformational. Delta Electronics is
~vp~ illustrative. ■&
Implications for Corporate Image

An organization that is permeated with a suitable pattern of
transformational and transactional leadership from top to bottom
provides an image to its own cadres as well as to financial back-
ers, suppliers, customers, clients and the community-at-large, of
an organization that is oriented toward the future, that is confi-
dent about its capabilities, that has personnel who work together
for the common good, and that values highly its intellectual
resources, flexibility, and the development of its people and
products. For the Army, its true state of readiness is both praised
and prized by both insiders and outsiders.
It is no accident that many of excellently managed firms
nowadays contain a large proportion of transformational leaders.
Conversely, the poorly managed "dinosaurs" need to develop a lot
more of transformational leadership in their organizations. By "a
reasonable frequency" of transformational leadership, our frames
of reference are the scales of the MLQ. All correlate highly with
effectiveness, performance and satisfaction. We suggest a mean of
<>
Bass Book 6-7 2/26/96 9:45 AM Page 95
<>
3.0 or higher on each of the four scales of transformational leader-

ship whose magnitude-estimated anchors range from a true zero
for the response of "never" to a maximum of 4.0 representing
"frequently, if not always." The response "sometimes" is set at
2.0. Contingent reward and active management-by-exception
ideally should be at about 2.5 for military organizations and
passive management-by-exception and laissez-faire leadership at
1.0 or below on the average.
Implications for Recruiting

Increasing transformational leadership within the organiza-
tion may attract better recruits. Candidates are likely to be drawn
to an organization whose head is charismatic and inspirational
and who is known to be confident, successful, and optimistic.
Moreover, prospects are likely to view the organization more
favorably if the interviewer displays individualized consider-
ation. Better educated and brighter prospects will be impressed
in meeting with intellectually stimulating representatives of
the organization during the recruiting process.
~w Implications for Selection, Promotion, Transfer and Guidance -£)-

The leadership components of charisma, inspirational moti-
vation, intellectual stimulation, and individualized consideration
that describe transformational leaders can be incorporated into
assessment, selection, and placement programs (see Section 9).
And as leadership performance at one level is likely to forecast
performance at the next, followers, peers and superiors can be
used to describe the current leadership behavior with the Multi-
factor Leadership Questionnaire of prospective candidates for
promotion or transfer into positions of increasing supervisory
responsibility. Feedback of MLQ results can also be used for
mentoring, counseling, coaching and training (Bass & Avolio,
1990) (see Section 8).
Again, since charismatic and inspirational leaders display
various personality attributes such as high energy, self-con-
fidence, determination, intellectual and verbal skills, strong ego
ideals, and an inner locus of control, measures of such traits can
provide valid screening instruments. In the same way, underlying
individualized consideration are coaching skills, preference and
use of two-way communication, empathy, and willingness to use
o-
Bass Book 6-7 2/29/96 11:19 AM Page 96
O
delegation. Intellectual stimulation involves general intelligence

at lower organizational levels and cognitive creativity at higher
levels. Each of these traits and abilities can be as assessed in
advance and used as part of larger selection batteries as will be
discussed in Section 9.
When employees rate their managers on the MLQ, they
describe new business leaders as significantly more transforma-
tional than established business leaders. Thus MLQ scores can be
used profitably to identify executives to head new ventures (Bass,
1990). The parallel in the military may be sorting out the better
garrison from the better combat commanders. Bass (1985) found
that field-grade combat officers were more transformational than
those in non-combat assignments.
Implications for Personnel Development

A management trainee's first supervisor makes a big differ-
ence in his or her subsequent career success. In 1978, it was found
that six years after a sample of over 400 managers had joined
Exxon, those who were more highly rated for merit by superiors
-Q- at the end of the six years reported that they had been given _r\
T challenging assignments by their initial supervisor (i.e., they had
been inspired, intellectually stimulated, and had received indi-
vidualized consideration). They were also more highly rated at
the end of the six years if they had been assigned to initial super-
visors with good reputations in the firm. They could model their
own leadership style after that of their initial supervisors. Thus,
Bass, Waldman, Avolio, and Bebb (1987) demonstrated that if
immediate superiors are more charismatic, their subordinates
will also be more charismatic in their leadership.
Organizational policy must support an understanding and
appreciation of the maverick who is willing to take unpopular
positions, who knows when to reject the conventional wisdom,
and who takes reasonable risks (Bass, 1990). The designer of the
stealth fighter had to overcome ridicule and disbelief before get-
ting approval to proceed. Policy should encourage the nurturance
of intellectual stimulation as a way of life in the organization.
In the Information Age, the "best and the brightest" should be
encouraged and nourished. Innovation and creativity should be
fostered at all levels. Effective total quality management programs
will depend much on this effort.
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Bass Book 6-7 2/29/96 11:21 AM Page 97
o-
Implications for Training

Transformational leadership is a widespread phenomenon
(Bass & Avolio, 1990). As we will detail in Section 10, surprising
little more of it occurs at the top than at the bottom of an organi-
zation. The gradient was rather small, when comparisons were
made among 700 NATO field-grade officers and when Navy
lieutenants were compared with Navy captains and their super-
iors. It has also been observed by many personnel in their
first-level supervisors. As will be the subject of Section 8, trans-
formational leadership can be taught and learned. Shop stewards
in correctional institutions, project leaders, first-line super-
visors, middle managers and senior executives in industry, hospi-
tals, education and elsewhere have benefited from training in
transformational leadership.
Implications for Leadership Education

Military academies have traditionally emphasized leadership
education. Currently there is considerable interest in leadership
courses in both liberal arts colleges as well as professional schools
-Q- of business, education, social service, nursing, etc. At least 600 _ZA_
^ such courses were being offered, according to a recently com-
pleted survey of colleges by the Center for Creative Leadership.
The subject of transformational leadership also has been added
to many of these programs. For instance, in one such leader-
ship course at the U.S. Air Force Academy at Colorado Springs,
both faculty and students examine how Air Force commanders
who are transformational leaders serve as role models for the
cadets in their squadrons. Scales from the MLQ are used to
show that the transformational leaders among the instructors
and staff provide role models for their students. The faculty and
students discuss the questionnaire results and their implications
(Curphy, 1990).
Clearly, training can seldom turn an exclusively transactional
leader into a highly transformational leader. Moreover, some lead-
ers, while striving to be transformational leaders, can misuse their
training. Their pseudotransformational efforts only further the
leader's self-interest and values. Under the influence of such a
leader, followers can be directed away from their own best inter-
ests and those of the organization as a whole.
■e-
Bass Book 6-7 2/27/96 2:08 AM Page 98
■e-
For too long leadership development has been seen mainly

as a matter of training, as such, and skill development. But
leadership—particularly transformational leadership—should be
regarded as an art and a science likely to be enhanced with a
quality education process.
Implications for Career Development

Three points can be made here. First, it will pay to introduce
the concept of transformational leadership by example early in
the careers of new personnel and then to provide continuing
support for it. Second, its diffusion will flow "top down." Third,
the organizational culture should support its development and
maintenance. Transformational leadership and the philosophy
that underlies it can become an integral part of an organization's
career development program.
In support of the first point, as we have already noted,
the first supervisor of a new recruit can make a big difference in
the subsequent career success of the recruit. A policy of individ-
ualized consideration at all organizational levels will encourage a
_^^_ renewal of each individual to achieve his or her maximum poten- _ri
^ tial throughout that individual's career in the organization. In
support of the second point, we have also described the cascading
effect. Managers tend to model their own transformational leader-
ship on that of their immediate superiors or mentors. As higher-
ups become more transformational, we see more transformational
leadership cascading downwards (Bass, Waldman, et al., 1987).
To illustrate the third point, policies should be in place so that
intellectual stimulation is nurtured and embedded as a way of life
in the organization's culture. Organizational policy must support
an understanding and appreciation of those who are willing to
take unpopular positions at early stages in their careers, who
know when to reject conventional wisdom, and who can accept
reasonable risks. There must be a "right to fail."
Implications for Job Design and Job Assignment

As we have noted, highly rated managers had had chal-
lenging tasks delegated to them by their supervisors when they
first joined the company. Jobs should be designed to provide
greater challenges.
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Bass Book 6-7 2/29/96 11:21 AM Page 99
-Q-
In Section 12, we will discuss substitutes for leadership. One

likely substitute for inspirational motivation is being assigned
a challenging task. Individualized consideration should be
provided through delegation with guidance and follow-up. This
should become an individualizing and developmental way of life
in the organization.
Transformational leaders show individualized consideration
by paying attention to the particular development needs of
each of their subordinates. Subordinates' jobs are designed with
those needs in mind as well as the needs of the organization. One
subordinate could profit from the experience of leading a project
team. Another needs an opportunity to reinforce what she has
learned in an advanced computer programming class. Their indi-
vidually considerate leader assigns them tasks accordingly.
Leaders can be intellectually stimulating to their subordi-
nates if the leaders' own assignments give them the discretion to
explore new opportunities, to diagnose organizational problems,
and to generate solutions. On the other hand, leaders with assign-
ments from higher authority or outside constituencies that force
-£)- them to focus on solving small, immediate problems are likely to _f\
be less intellectually stimulating than those who have the discre-
tion to envision what is needed, and who have time to think
ahead and to think proactively.
Implications for Organizational Structure

Transformational leadership is not a panacea. In many situ-
ations it is inappropriate and transactional processes are indi-
cated. In general, organizations and agencies that are function-
ing in stable environments can afford to depend on their "one
minute" managers to provide the necessary, day-to-day leader-
ship. If the technology, workforce, and environment are stable
as well, then things are likely to move along quite well with
managers who simply promise and deliver rewards to employees
for carrying out assignments. And in stable organizations, even
active management-by-exception can be quite effective if the
manager monitors employee performance and takes corrective
action as needed. Rules and regulations for getting things done,
when clearly understood and accepted by the employees, can
eliminate the need for leadership under some circumstances.
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Bass Book 6-7 2/27/96 2:10 AM Page 100
-Q-
But when the organization or agency is faced with a turbulent

environment; when its products and services are born, live, and
die within the span of a few years; and/or when its current tech-
nology can become obsolete, then a rigid organizational structure
of rules, regulations, job specifications and passive management-
be-exception becomes the "kiss of death." Transformational lead-
ership needs to be fostered at all levels in the organization. In
order to succeed, the organization needs to have the flexibility to
forecast and meet new demands and changes as they occur, and
only transformational leadership can enable the firm to do so.
The ill-structured problems faced by such organic organizations
call for leaders with vision, confidence and determination. These
leaders will have to move followers to assert themselves and to
join enthusiastically in organizational efforts and shared respon-
sibilities for achieving organizational goals. The leaders will
arouse followers' collective consciousness about what they are
attempting to accomplish. Charismatic/inspirational qualities,
attention to individualized consideration, and to intellectual
stimulation are to be sought and encouraged in organizations that
must live with continuing demands for renewal and change.
\.i~ Problems, rapid changes, and uncertainties call for a flexible -&-
organization with determined leaders who can inspire employees
to participate enthusiastically in team efforts and share in organi-
zational goals. In short, charisma, attention to individualized
development, and the ability and willingness to provide intellec-
tual stimulation are critical in leaders whose organizations are
faced with demands for renewal and change. At these organiza-
tions, fostering transformational leadership through policies of
recruitment, selection, promotion, training, and development are
likely to pay off in the health, well-being, and effective perfor-
mance of the organization.
With the cohort of recent and new recruits, the successful
military organization will be the place where individual needs are
recognized and enhanced rather than brought into conformity
with the old way of doing things. Within the constraints of mili-
tary requirements the dreamers will be allowed to dream and to
test the absurd in problem exercises. The leaders will know that
the best form of leadership builds followers into disciples who
take responsibility not simply to accept a vision, but to expand
that vision even further than their leaders anticipated.
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Bass Book 6-7 2/27/96 2:11 AM Page 101
<>
Implications for Diversity, Team and Organizational

Development
Transformational leadership has direct application to diver-
sity and to group and organizational development as well. Fol-
lowing both processes to their logical extreme, a transformational
leadership training and development program should be evalu-
ated as successful if the organization has been transformed to a
level where it challenges its diversity of followers to develop
themselves as well as others around them. The program should be
evaluated as successful if leaders develop themselves to a level
where they have inspired their diverse followers, intellectually
stimulated them to solve problems in unique and creative ways,
and exercised individualized consideration. If such transforma-
tions have occurred both individually and at the group and organ-
izational level, the stage is set for furthering the organization and
its members' achievement of their full potential.
The advantages of transformational leadership can be rein-
forced by organizational policies, structure, and culture, thus
greatly improving the overall performance of both individual
-Q- members and the organization as a whole. Increased transfor- _f\_
^ mational leadership and its effects can occur at every organiza-
tional level.
Team Leadership. Leaders need to be individually consider-
ate in dealing with followers from different functional areas
and backgrounds and must show sensitivity to these differences.
They must avoid glossing over the different constraints faced by
their diverse subordinates who may be on different career lad-
ders, have different superiors to whom they report, be of different
race and sex, and who have their different needs. Individually
considerate leaders need to show they recognize the multiple
identities of their team of diverse subordinates. They should dele-
gate opportunities to make it possible for some of the different
subordinates to represent the team in meetings with other teams,
with higher authority and outside agencies. Team leaders need
to be sensitive to the demands placed on individual members of
the organization from different functional areas, their reputation,
and the quality of the relationships in their different functional
areas. In the military, in particular, special attention must be paid
to family issues. Team leaders need to be conscious of the differ-
ent kinds of issues that are sensitive to members of different
minorities. The team leader must know the capabilities of each
team member.
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Intellectually stimulating leaders take advantage of diverse

background and experience of their team members, which can
promote greater creativity than if the members are homogeneous
in functional expertise and background. Not being an expert in all
areas represented by the members of the team, the intellectually
stimulating leaders should serve as catalysts for creative activity.
They move the members to unearth their diverse assumptions
and to problem solve in orderly stages. The team leaders need to
be directive when necessary, clarifying, summarizing, and testing
for consensus.
Implications for Decision-Making

Team and organizational decision-making ideally involves
scanning, problem discovery, diagnosis, search, evaluation,
choice, innovation, authorization and implementation (Bass,
1983). It should proceed in an orderly forward fashion from scan-
ning to implementation but seldom does. For instance, without
adequate diagnosis and search, many an ineffective team or organ-
izational leader first makes a choice, then asks for a justifying
evaluation of the preempted choice.
T The process may flow in a reversed direction. We may
observe direct and indirect links and reversals among each of the
phases from scanning to implementation. Thus, failed attempts at
innovation may result in a need to return to the diagnostic and
search processes.
Intellectual stimulation may be necessary when seemingly
unresolvable problems of conflicts among the diverse interests of
the members arise from the divergent interests of the members.
Basic assumptions need to be tested and alternative viewpoints,
procedures, and perspectives need to be developed. Inspirational
team and organizational leaders need to promote understanding
of the team and organization's mission and importance. They
need to describe what should be done in a language that the
diverse members find readily understandable. Inspiring leaders
remain optimistic about likely outcomes and boost their team's
and organization's confidence. Simple words are employed which
permit understanding across the boundaries between the func-
tional areas and the diverse backgrounds of the members. A com-
mon language is sought. Technical jargon is avoided wherever
possible if it is limited to usage to only a few of the members.
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Despite the diversity of interests and backgrounds, team and

organizational leaders must inspire a clear sense of purpose and
direction. They must be "keepers of the vision." Team leaders
should promote cooperation and alignments of individual, team
and organization.
Ideally, it should be possible to attribute some charisma to
the person who leads the team or organization. They should have
a reputation for integrity, capability, and success. In turn, such
charismatic leaders should provide a role model for working well
with others of different opinions. The leader, ideally, should be
someone whom the diverse members will want to emulate.
Not to be forgotten is the need for team and organizational
leaders to be transactional as they cope with necessary technical
controls and personnel practices. The more they can be construc-
tive and active in their exchanges the more likely the team or
organization will progress as an effective decision-making body.
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SECTION 8
Development and Training in

How and what about transformational leadership can be

effectively taught and learned? To answer this question, we will
first address some of what is known about the experiences in
one's earlier development that constitute becoming more of
a transformational than a transactional leader. Then, we will
describe a customized training program which has been taught
to several thousand administrators and managers in a variety of
agencies and organizations. We will conclude with evaluations
completed demonstrating the extent to which significant learning
has occurred and been applied and commentaries about the
^ successful training of transformational leadership in several J.
~^-^~ other programs. v7~
DEVELOPMENT OF TRANSFORMATIONAL LEADERSHIP
Assessment of Personal Background and Experience

Interviewers of job applicants and candidates for promotion
delve into the past of applicants or candidates to assess their
leadership potential. Such interviews also have been conducted
in many research efforts to detect differences in background of
transformational and transactional leaders (Avolio & Gibbons,
1988). The predictive utility of biodata in forecasting subsequent
leadership performance, well-known in its time, was present in
Cox's (1926) study of the biographies of 300 geniuses. Evidence
from biographical accounts about the development of 69 famous
world-class transformational and transactional leaders was
reported in anecdotes by Bass (1985) and empirically by Bass,
Avolio, and Goodheim (1987).
105
<>
Bass Book 8-9 2/29/96 11:27 AM Page 106
<>
The approach was applied in standardized versions of appli-

cation blanks and personal history forms for early identification
of leadership potential in industry, education and the military.
Leadership potential found was correlated with items such as:
age at beginning first steady paid job, volunteer work, learning to
swim and ride a bike, rural or urban background, early experience
as a supervisor, shooting a gun, hiking, camping, repairing cars
and engaging in athletics while in high school, and previous
organizational and work experiences as a leader (e.g., Owens &
Schoenfeldt, 1979). However, Betlin and Kennedy (1990) showed
that the experience had to be relevant for it to be predictive.
Measures of experience such as time in service and the diversity
of experience (in terms of the different number of positions pre-
viously held) added only 1% to 5% to the prediction of the cur-
rent military performance of the 84 U.S. Army captains based on
ratings by two superior officers (the battalion commander and
the battalion executive officer). But what was highly predictive
was the relevance of previous assignments and responsibilities
assessed by a set of expert judges which added 20% to the
prediction of the current assignments of the captains as company
_ry_ commanders, personnel officers, intelligence officers, operations _r\_
T officers or logistics officers. Earlier relevant experiences also ^
appear to contribute to emerging as a more transformational
leader in adult life.
Differences in Life Histories. Among Digital Equipment
senior executives, Avolio and Gibbons (1988) compared transac-
tional and transformational leaders (according to MLQ ratings by
their immediate followers). Differences in life history profiles
were revealed in in-depth interviews that were completed with
the executives. Interviews were conducted with executives who
had been identified as high in transactional or transformational
leadership or low in both. Highly transformational executives
came from families that stressed high standards of excellence
along with strong, supportive homes. Executives rated by their
immediate followers as highly transformational reported in
retrospective interviews that their parents provided them with
challenges but also supported their children's efforts whether
they resulted in success or failure. It was okay to fail as long as
you tried your best. Mistakes were considered part of the learning
process. Transformational leaders engaged in more leadership
activities in high school and college. They did not play at being
leaders. Rather, their leadership behavior was an integral part of
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Development and Training in Transformational Leadership 107
their persona, based on long-term development rather than a

quick dose of training. On the other hand, transactional leaders
tended to take on particular leadership roles according to the
situation they faced—the kind of leadership then taught in short-
term training programs.
Similarly, Yammarino and Bass (1990) found that those
junior Naval officers who were rated as more transformational
tended to be more involved in high school sports activities, par-
ticularly team sports. Again, for Virginia Military Academy
cadets, adolescent athletic activities were a positive indicator of
subsequent transformational leadership performance (Atwater,
Lau, Bass, et al., 1994).
In another retrospective analysis, prior to their beginning a
transformational training program, Avolio (1994) asked 182 lead-
ers from different organizations and agencies to complete a ques-
tionnaire about their life before volunteering for the program.
Included in the Life History Questionnaire were eight questions
about their parents' interest. For example, how often did one or
both parents "take an interest in how you were doing in your
_£:\_ classes in elementary or high school?" _£>
The moral standards and strictness of parents were queried
along with the extent the respondents wanted to emulate their
parenting. Experience in high school athletics and other extra-
curricular activities were examined along with favorableness of
attitudes toward school and one's first full-time job.
Empirical Findings. The 182 focal leaders completed the self-
rated MLQ and were rated by their 856 followers. Overall, a
meaningful pattern was found of correlations between the
retrospections of one's life history and self- and follower-rated
MLQ's. Scale scores on a factored cluster of items which recalled
positive experiences in elementary and high school correlated
between .19 and .24 with all four self-rated components
of transformational leadership factored scale scores. Again,
feeling positive about the work experiences in one's first full-time
job correlated with MLQ self-ratings as follows: charisma, .24,
inspirational motivation, .36; intellectual stimulation, .30 and
individualized consideration, .27. High parental moral standards
correlated .16 with individualized consideration.
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Bass Book 8-9 2/29/96 11:29 AM Page 108
£>
Parental interest and their high moral standards correlated

significantly between .16 and .20 with charisma and individual-
ized consideration as measured by followers' MLQ ratings. As
would be expected, favorable school experiences correlated .17
with intellectual stimulation as seen in the leaders by their fol-
lowers. Also, a scale based on factored items of frequent engage-
ment in athletics and outside activities while in high school
correlated -.31 with self-rated intellectual stimulation.
Intuitive-Empirical Analysis
In addition to the empirical findings just described, in an as
yet unpublished analysis (Bass & Avolio, undated), an intuitive-
empirical approach was applied to the biodata. The items and
their alternatives had each been placed in the biodata question-
naire because intuitively it was thought that each contributed to
at least one of the components of the full range model of trans-
formational-transactional leadership. For example, prior to any
data analysis, we began with 92 alternatives from 49 of the items
which we hypothesized would be indicative of development as
^ a charismatic-inspirational leader. Empirically, we found for 44 ■
v7~ of the 92 alternatives, responses which were at least 6% greater -£;)-
for those 167 community leaders above the median on charisma
and inspirational leadership as MLQ rated by their 786 followers
than for those below the median on MLQ-rated charisma and
inspirational leadership.
Charismatic-Inspirational. Consistent with the straight-for-
ward empirical correlational results of biodata scale scores and
MLQ scale scores were the emergence of three sets of biodata
precursor alternatives which both intuitively and empirically
discriminated according to the 6 percent criterion between the
above-the-median and below-the-median MLQ groups. We began
with 92 alternatives from 49 items which we hypothesized in
advance were precursors of inspirational leadership. Of these, 24
also were empirically discriminatory in that those above the
median on the MLQ charisma and inspirational motivational
scales chose the alternative so identified at least 6 percent more
frequently than those below the median.
The hypothesized biodata precursory description of future
charismatic-inspirational leaders according to their 786 followers
was as follows:
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<>
• Parental achievements were equal to those of most parents.

• Both father and mother succeeded in being good parents, but
"I'll do better."
• Upbringing was strict but fair.
• No, mother was not employed.
• Did not confide in mother.
• Family never moved from one house to another.
School age experiences included the following precursors of
charismatic-inspirational leadership on the MLQ:
• Almost always a leader of the gang or "clique."
• Usually picked near first for team games.
• Participated in student government, fraternity, and social
groups in high school.
• One of the most active and popular students in high school.
• Preferred teachers hard to get a good grade from.
Early adulthood precursors of charisma-inspiration
included:
• Most bothered by other people's lack of initiative.
-Q~ • Is quite confident of self in most activities. _c^_
' • Dissatisfied with self once in a while. ^
• Most important is making the most of abilities
(self-actualization).
• Most influencing career was accomplishing an ideal at work.
• Engages in religious activity 1-3 hours a week.
• Reads adventure stories, biographies and historical novels.
• In past 5 years, held offices in clubs, committees, etc.
• Held 3-5 elected positions in past 3-5 years.
• Most influencing my career was accomplishing an ideal at
the work.
Intellectual Stimulation. Forty-four of 135 alternatives had
been singled out as hypothesized precursors of intellectual stim-
ulation from among 27 5-item choices. Of these 44 intuitively-
selected alternatives, 10 proved to be empirically discriminating
and in the hypothesized direction. They clustered into family
and school experience and adult interests in that at least 6
percent more of those above the median than below the median
in MLQ intellectual stimulation, as rated by followers, chose
the alternative.
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Bass Book 8-9 2/26/96 9:55 AM Page 110
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Precursors of intellectual stimulation included:

• Father had a graduate degree.
• Mother was a college graduate.
• Several bookcases full of books available when growing up.
• Liked school very much.
• Somewhat above average student in high school.
• Read one or more newspapers thoroughly each day.
• Devotes much time to reading all kinds of material, including
work-related.
• Bothered most by people who brag.
• Self-actualization most important.
• Like most listening and/or creating new ideas on the job.
Individualized Consideration. Those higher in individual-
ized consideration on the MLQ compared to those lower
responded more frequently as follows:
• Had positive relations on the job with immediate superior,
coworkers, subordinates and clients.
• A major motivating force in life is to help others.
^ • Had a happy rather than an unhappy childhood. ,
v7~ • Were praised as children as rewards for performance. "&
• Had mothers who took much interest in their K1-K12 school.
• Had well intentioned but overly possessive fathers or highly
formal fathers.
• Varied from uninterested to strongly interested in their
schooling.
• Wanted others to feel that "I was a nice person."
• Encouraged others to talk to them about their personal
problems.
• Told personal problems by others.
Contingent Reward. While many precursors had been uncov-
ered for the transformational components, none of the MLQ trans-
actional contingent reward could meet the criterion of the
advanced hypothesization coupled with empirical support.
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Development and Training in Transformational Leadership ill
Management-by-Exception. Fourteen alternatives among 12

items were identified in advance intuitively as likely to be
precursors of frequently managing-by-exception. The validity,
however, of only one of these was supported empirically. There
was an 18 percent greater choice by the "highs" in managing-by-
exception than the "lows" for indicating that if brought up by both
parents, they both were equal in disciplining the respondents.
Laissez-Faire Leadership. Of 47 alternative responses possi-
ble from 24 items from the biodata questionnaire, six were identi-
fied in advance as precursors of laissez-faire leadership and met
the 6 percent criterion for discrimination. Six of these also passed
the empirical test of at least 6 percent greater occurrence among
the above-the-median MLQ laissez-faire scores than below-the-
median. These six were as follows:
• Father was not at all interested in my K1-K12 performance.
• Parents interested but did not know what career I wanted
to pursue.
• When you broke something as a child, parents usually said
little or nothing about it.
-CX. • Parents neither encouraged nor discouraged me to seek _r\_
' school or church offices. ^
• Parents never gave me material rewards for good grades
in school.
• Was not elected to any offices in the past five years.
Implications
The biodata results lend support to the psychoanalytic view
than many celebrated leaders such as Pierre Cardin and Henry
Ford were "prisoners of their past." Pierre Cardin had a strong
need to get even for the wrongs done to him as an Italian young-
ster growing up in France, upheavals in the family but with
continued strong support from his mother. In response, he democ-
ratized fashion, creating a billion dollar haute couture for the
common man. Henry Ford had a difficult relationship with his
father and a close, loving mother who died when he was 13. As
an adult, Ford had few real friends and was unable to accept
ideas easily from others around him (Kets de Vries, 1994). In
the same way the differences between two such transforma-
tional leaders as Dwight Eisenhower and Douglas MacArthur
can be understood to some extent by Eisenhower's more humble
beginnings and Douglas MacArthur's, as son of a famous Civil
War General.
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Bass Book 8-9 2/29/96 11:32 AM Page 112
<>
Transformational leaders in adult life just don't emerge acci-

dentally. They are shaped to some degree by the high moral stand-
ards set by their parents and interest shown in their early
performance, particularly in school. Avolio & Gibbons (1988)
reported that neither a severely disadvantaged nor highly privi-
leged childhood was as conducive to becoming a transformational
leader but rather a childhood with some, but not too much, chal-
lenge. Consistent with this, Avolio (1994) found that feeling satis-
fied with home and school were important in retrospect. While
adolescent athletics appeared to be a positive activity for military
cadet samples of transformational leaders, it was not so for civil-
ian community leaders, perhaps because of the much larger per-
centage of females (52%) in the community sample.
COUNSELING, TRAINING AND EDUCATION
Transformational leadership can be taught and learned.

However, as Bennis and Nanus (1985) noted, the traditional MBA
program was failing in this endeavor because it focused on learn-
r^_ ing to manage simple, stable situations. It served to create a _^>
T^ bureaucratic transactional mentality. ^
Competencies To Be Learned. Conger and Kanungo (1988)
suggested that charismatic leadership, which in their definition
includes four components of transformational leadership, can
be developed by learning five competencies. The first is critical
evaluation and problem detection. The second is envisioning
which can be fostered in courses in creative thinking to learn how
to unlearn and to contemplate profound changes. The Quick
Environmental Scanning Technique (QUEST) was suggested as an
aid. Here participants brainstorm about their company's environ-
mental circumstances and devise strategies for dealing with
change. The third competency is the communication skill for con-
veying a vision. The fourth competency is impression manage-
ment to reinforce the bases of their transformational leadership.
For this, they need to learn the use of exemplary behavior, appear-
ance, body language, and verbal skills. The fifth competency to be
acquired is how and when to empower followers to enable them
to complete the mission shared with the leader. Empowerment
can be enhanced through the competence of transformational
leaders in communicating high performance expectations,
improving participation in decision-making, removing bureau-
cratic constraints on followers, setting meaningful goals, and
applying appropriate systems of reward.
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Bass Book 8-9 2/29/96 11:36 AM Page 113
Q~
Acknowledgements 113
At least one report of a 3-day workshop on transformational

leadership for Israeli Defense Forces military cadets has been pub-
lished (Popper, Landau, & Gluskinos, 1992). And aspects of the
components have been introduced to the Air Force Academy
classroom (Curphy, 1990; 1992).
Training and education in transformational leadership must
promote self-understanding, awareness and appreciation of the
range of potential leadership behaviors used by both effective
transformational and transactional leaders. It must go beyond
skill training. It must be internalized and point to the extent that
the best of leaders are both transformational and transactional but
they are likely to be more transformational and less transactional
than poorer leaders.
In the next portion of this section, dealing with in vitro coun-
seling, training and education for transformational leadership, we
will primarily depend on experience with the full-range of leader-
ship model (based on the MLQ factor structure) and its applica-
tions since its components are probably the most widely used in
diverse civilian settings. For this reason most of what follows in
-Q- prescription and evaluation of counseling and training will be _r\_
T based on unpublished work completed with training over 500 ^
civilians in not-for-profit organizations and a similar number in
profit-making firms.
COUNSELING AND GUIDANCE
Feedback of MLQ Results

For people to change their behavior, perceptions, and atti-
tudes, they need to be aware of the specifics that require changes
and the motivation to make such changes. A diagnosis is needed
to establish appropriate substitutes for currently noted ineffective
leadership. And so, as Pile (1988) did, results from the MLQ are
fed back to each leader in individual counseling arrangements. A
computerized MLQ profile provides counselors and leaders with
a comprehensive description of the leaders' performance accord-
ing to themselves, their subordinates or their coworkers (and their
superiors when the 360 approach is employed).
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The meanings in the data are explained by the counselors to

the leaders. Comparisons are drawn: how the leaders' scores com-
pare to the general norms for other leaders, how the leaders' self-
ratings compare with ratings by subordinates or coworkers and/or
superiors, and how the leaders' MLQ scores compare to other
leaders in their own organization. On an item-by-item basis for
the 70 items, as well as on the component factor scores, specific
areas are identified in the profile that are viewed as strengths as
well as weaknesses for the leader.
Since each item does not necessarily identify all of the
actions or behaviors that resulted in the rating, the leaders need to
give some thought to identifying events, incidents or actions
which can aid in their interpretation of the ratings. In addition to
reviewing the normative results, leaders need to consider the
absolute frequencies they are provided from the MLQ ranging
from 0=never to 4 = frequently, if not always, for some of the
results may seem absolutely too high or too low. A counselee
might strive to achieve 3.0 or higher in the transformational
components, 2.0 or lower in managing-by-exception and 1.0 or
lower in laissez-faire leadership.
In all, the feedback should move the leaders to target desired ^
changes. Rather than spending time questioning their raters'
intentions, leaders need to focus on their new awareness of
the broad range of leadership components measured by the MLQ
at a behavioral level and how many of the individual items
within those components apply to the overall model described in
Section 1 of this report. Leaders become able to generate personal
ideas for self-improvement, and specific goals and objectives to be
achieved in enhancing the effectiveness of their leadership poten-
tial. Priorities can be set along with the methods used to try to
achieve the objectives.
A plan often seen is to try to increase one's individualized
consideration and reduce one's passive managing-by-exception.
The focus on individualized consideration fits with seeing
that one's self-development is consistent with increasing one's
emphasis on developing others to their full potential. The skills
and insights regarding self-improvement are the same skills
and insights important to developing followers to their full poten-
tial. Moreover, as a key element of charismatic leadership is
role modeling desirable behaviors, showing a willingness to fol-
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Bass Book 8-9 2/29/96 11:39 AM Page 115
<>
lowers to change one's own behavior when it is counterproduc-

tive, is likely to "rub off" on followers. Counselees must decide
for themselves whether they are ready for change, and if so, in
what directions to make such changes and the time in which they
will make the attempts to change.
The Personal Development Plan

During several months that follow an initial MLQ feedback
session, profiled leaders work out their personal development
goals and plans. The plan established for an individual leader
often varies depending on the specific leader's needs. It may
include workshops in areas that require strengthening, one-to-one
counseling, observation of other leaders or some combination of
activities. Whatever plan is chosen, the focus is on building the
leader's ability to function as a transformational and active trans-
actional leader. An on-site OD consultant can serve a very useful
role here in facilitating the implementation of the leader's plan
through process observations of one-to-one meetings between
leaders and followers, by being a "sounding board" of ideas, and
^ by providing support and reinforcement for changes the leader is i
tr attempting to implement. -£)-
Included in the plan should be a continuation of specific fol-
low-up evaluations. A rather straightforward follow-up might
involve readministering the MLQ survey to followers or col-
leagues of the leader, the leader's superior and to the leader
at some designated point in the future. In some situations it may
be appropriate to observe the leader interacting with followers or
to interview followers, superiors and coworkers to get an estimate
of the changes observed in the target leader. It should be kept in
mind that the process of change and development regarding the
leader is generally a long-term one that requires continual updat-
ing, feedback, and modification. With most leaders, the changes
identified in their developmental plans occur over time. Changes
that are abrupt or inconsistent with past behaviors of the leader
may be misinterpreted by followers, or even the superior, as well
as be seen as threatening (Bass & Avolio, 1990).
A Planning Guide is made available to participants to assist
in the process. Although the process can take place as a counsel-
ing affair, it also can be embedded in the formal training program
described later in this section.
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Bass Book 8-9 2/29/96 11:38 AM Page 116
&
Evaluation of Counseling
In an evaluation by Pile (1988), a counselor guided the inter-
pretation process and supported the search for meaning and
understanding. Pile reported that Humble Oil managers who
received feedback from an internal OD consultant on their MLQ
scores along with a session to develop a plan to improve their
leadership showed significant improvement in their transforma-
tional leadership ratings from their subordinates resurveyed after
a 6-month interval. In the counseling sessions, the managers were
asked to identify specific leadership behaviors they wanted to
improve, ignoring the intentions underlying those behaviors. It
was assumed that their intentions were to become more effective
leaders, but to do so required them to make changes in their
behavior. Compared to a control group of managers who simply
received feedback on their MLQ scores, the trained group showed
significant improvement in their MLQ leadership ratings.
TRAINING IN TRANSFORMATIONAL AND

^ TRANSACTIONAL LEADERSHIP ,
Although other programs such as those of Kouzes and Posner

(1987), the Center for Creative Leadership's LeaderLabs and
Conger-Kanungo's training in charismatic competencies intro-
duce the transformational-transactional paradigm, as far as I
can tell, the most research-based effort has been the Full Range
Leadership Program (FRLP) developed by Avolio and Bass (1991).
It is this program I can describe in some detail to answer the ques-
tion what and how to train in the paradigm of transformational
and transactional leadership.
Full Range of Leadership Development

The prototypical workshop runs three basic training days
and two to three advanced training days with a three-month inter-
val between the Basic and Advanced programs. A follow-up is
planned for a year later. Each of the three training days may be
consecutive or once a week. Customization to fit particular indi-
vidual or organizational needs may require reducing the training
days by omitting or reducing some of the training modules.
Unless the MLQ has been used in prior counseling as des-
cribed above, the MLQ is distributed approximately four weeks
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Bass Book 8-9 2/29/96 11:48 AM Page 117
-e-
before the first day of the Basic Training Workshop. The surveys
are distributed to followers (and superiors) by a neutral party
and returned anonymously. If circumstances preclude advanced
distribution of the MLQ, self-ratings are completed at the start of
training. Then participants near the end of the Basic Training or
personnel staff are asked to distribute questionnaires to the follow-
ers of the participants for completion and anonymous return.
The FRLP provides education along with skill training. The
philosophy of leadership involved in being transformational and
transactional is discussed early on. Although the program con-
tains some simulations and exercises, it mainly is a matter of
action learning dealing with real issues, dilemmas and problems
faced back home. It is stressed that there are numerous ways to
be a transformational and transactional leader—and that one
must be both. It is a question, usually, of needing to reduce
one's managing-by-exception and increasing some components of
one's transformational leadership. The program proceeds from (1)
increasing awareness of the leadership paradigm, (2) learning
about alternatives that are conducive to improving themselves as
^ well as the followers, and (3) adapting, adopting and internalizing ,
T7" the new ways of thinking and acting. -£}-
In the current prototype program, there are 13 modules, eight
in the Basic three days and six in the Advanced two to three days.
The interval of three months between the Basic and Advanced
Programs provides opportunities for trying and reinforcing
planned changes before returning for the Advanced Workshop.
The 13 modules are presented in manuals for each participant
(Avolio & Bass, 1991) and reviewed with certified trainers who
complete a special five-day training-of-trainers program.
The Basic Workshop

Introduction. The FRLP program begins with an appreciation
of the multiplicity of changes that have occurred to organizational
life since the 1980's. Leaders in the military, business, industrial,
service and independent sectors will have to be both excellent
leaders as well as excellent managers. They face continually
changing technologies, demand for faster turnarounds, quality
products and intense competition at home and abroad. Organiza-
tions have to become more responsive to change to effect change
just to keep up with changing internal and external demands on
them as well as to maintain and increase their effectiveness.
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Relevant to what Section 6 presented, some commen-

tors conceptualize the organizational changes in the 1990's as
"feminization." Policies shift toward more caring and concern
for their employees (who have survived downsizing). The sup-
posedly feminine values of networking and relations orientation
moderate the supposedly masculine aggressive concentration on
the work itself. Additionally, the young radicals of the 1960's had
found by the 1980's outlets for change in the organizations for
whom they went to work. Many of the liberal college students of
the 1960's became leaders in industry, the military and elsewhere
in the 1980's, resulting in social responsibility and the rights of
the individual becoming salient as organizational values. In turn,
the amount and rapid pace of change requires in the 1990's that
leaders empower their followers with more responsibility and
autonomy. Most leaders must be able to articulate a vision of the
future, enable their followers to develop the skills necessary to
make the vision a reality and empower them to make the effort.
The introduction stresses that the participant needs to be
both a good manager and a good leader. While good management
^ involves planning, directing and controlling, good leadership ,
~^7~ promotes the change needed to meet the rapid advances in -Q~
new markets and technology. While good management provides
predictability and order to meet the current requirements for
products and services, good leadership envisions new directions
and motivates others to move in these new directions. And while
good management organizes and structures its resources to carry
out its plans, good leadership inspires commitment, loyalty and
involvement to accomplish the mission articulated by the leader.
Module 1. This module follows with an examination of the
implicit theories of leadership in the heads of the participants.
They are asked to think of a leader in their past or present, either
inside or outside of their organization, who has had a profound
effect or influence on their development such as a parent, teacher,
work supervisor, coach, cleric, or older sibling. They are assigned
to briefly write about how they became acquainted with the
leader, how long the relationship lasted, the roles they and the
leader fulfilled, the challenges involved, and the relevant history
so as to provide understanding of the leader's orientation toward
leadership and advantages of having known the leader.
In a plenary session, the leader attributes and behaviors pre-
sented by the participants are combined by the trainer or facilitator
into five or six clusters without any identification of the clusters as
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such. But, what slowly emerges is that each cluster is one of the
components of the model of the full range of transformational-
transactional leadership introduced in Section 1, with most attrib-
utes collecting in the transformational clusters, a few in the
transactional clusters, and none in laissez-faire leadership. The
conclusion is reached that the image of an ideal leader that one car-
ries around in one's head, which is linked to one's implicit theory
of leadership, is mainly transformational leadership. And so the
question is posed, if this is true, then why don't we do more of it?
Module 2. The second module presents the full-range leader-
ship model with which we introduced this report. Participants
review each of the components of the full range of leadership
and how they relate to activity and effectiveness as leaders. Case
studies and behavioral examples focus attention on the various
leadership styles found in most organizations. Questions are
posed about each component such as how well it does or does not
fit the participants' own behavior and that of their organization.
Module 3. Participants view a videotape, "The Many Roads
to Transformational Leadership," which depicts some key behav-
■Q- iors typical of various leadership components. Discussions center _zx_
^ around the verbal and non-verbal behavior observed and the
effects of the designated type of leadership on the followers and
on the observers.
Module 4. Participants receive their own detailed leadership
profile based on the rating results of the Multifactor Leadership
Questionnaire (MLQ). This survey provides feedback on an
individual, organizational, and item-by-item basis. MLQ results
help participants create preliminary self-development leadership
plans. The feedback and planning content is similar to that
described earlier about what is covered in counseling. Partici-
pants serve each other as counselors, as desired. The trainer or
facilitator also assists the process.
Module 5. Working in teams, participants develop a video-
tape of two contrasting scenes. Each team scripts and then
videotapes each scene in which they serve as the actors. One
scene displays transactional leadership and the other scene,
transformational leadership. This videotape serves to check par-
ticipants' understanding of the distinctions between these leader-
ship behavior styles. Each team decides in advance whether both
their scenes will show directive leadership or whether both will
show participative leadership.
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Module 6. This module concentrates on the component

of individualized consideration. A survey of why participants
hesitate to delegate more frequently is completed. The survey
yields feedback on organizational and individual resistances to
delegation. Participants learn to use delegation to develop their
followers' potential. Many ways to make delegation more effec-
tive are presented. The individuals to be helped vary in experi-
ence, competence and attitude.
Module 7. Team members rate their peers on the transfor-
mational and transactional leadership behaviors observed during
the previous modules and discussions. Participants share feed-
back to the degree desired of the behaviors and discuss reasons
for their ratings and implications for improvement.
Module 8. Potential organizational blocks to the participants'
leadership plans are addressed—boss, self, followers, policies,
etc. Participants refine the objectives of their leadership plans
developed in Module 4 and review strategies to overcome the
potential blockages to carrying out their plans.
-Q- The Three-Month Interval Between Basic and Advanced _r^_

^ Workshops ^
During the three-month interval, participants have time
to practice key skills within their own work environment.
Advanced readings and cases studies are completed. Partici-
pants' leadership plans are tested and refined. The participants
may formulate and evaluate specific objectives and assess their
organizations' readiness for change. They may involve employ-
ees, coworkers, and superiors in evaluating their leadership style.
They identify an organizational problem, one which has been dif-
ficult to solve, for attempted solution in the Advanced Workshop.
And they may experiment with different leadership styles.
They may also collect survey data on their organizational
culture (see Section 5) from coworkers, followers, and/or superi-
ors and meet with their superiors to discuss their leadership
development plans.
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Advanced Workshop
Module 9. The success-to-date of each participant's leader-
ship plan is presented and discussed. Participants review their
leadership plans individually and in teams. Reasons for successes
and for failures are examined. Problems are discussed and plans
revised.
Module 10. Participants complete an exercise to understand
how participants' values affect their resource allocation decisions.
They are able to discern the differences in their own values and
how it affects their resource allocation decisions. The four values
examined are power, merit, equality and need. Uses of intellectual
stimulation to resolve conflicts in values are considered.
Module 11. During the three-month interval, participants
have prepared and submitted actual work problems which
appeared difficult or impossible to solve. Intellectually stimulat-
ing leadership approaches are presented on how to help one's
colleagues be more creative as individuals and in groups. Then
teams work out solutions to several of the problems. Discussion
^ emphasizes the intellectually stimulating strategies that were sue- .
~^.y~ cessfully employed to solve the problems. ~T.T
Module 12. Participants focus on understanding the charac-
teristics of their own organizational cultures, transactional and
transformational, using the Organizational Description Question-
naire (ODOJ described in Section 5. They systematically examine
desired changes and how to effect such changes. Ways of using
inspirational motivation are presented and discussed.
Module 13. This module deals with participants envisioning
a near future in which the participants have aligned their own
interests as leaders with those of their subordinates, colleagues
and organization. The relevance of charismatic leadership is con-
sidered. Each participant develops a videotape which shows their
vision of the near future. Team members help critique and refine
the visions.
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Followups
Strongly urged are followups in six months to a year with
a half-day workshop. A followup module has been designed for
this purpose.
Evaluation of Training
Along with in vivo development and in vitro counseling,
structured training has been found useful. Most of the training
builds on already-developed implicit leadership theories held
by the participants and skills they have already developed.
Where necessary, leadership attitudes, perceptions and behavior
are reshaped.
The Basic and Advanced FRLP workshops have been com-
pleted by over 500 leaders from different sectors—industrial,
government, health, educational administration, etc.—in the
Binghamton area as well as upwards of 1,000 middle and senior
managers in business, industry and government in the United
States and abroad. Military educators from the United States,
_£^_ Indonesia, Israel and Saudi Arabia have been certified in training-
M7~ of-trainers programs. -£^-
Five- and six-day workshops conducted with senior and
middle managers in human resource management, marketing,
manufacturing, finance, and R&D managers and community
leaders have provided considerable evidence that individuals can
learn how to become more transformational in their behavior with
positive effects on their colleagues' and followers' performance.
As part of FRLP, self-reports and incidents routinely assess
the impact of the program. For instance, as already noted, in
Module 9, participants report on what they have been able to
transfer back to their jobs about what they have learned in the
Basic Workshop as well as the obstacles they confronted. When
used, the follow-up module provides the opportunity for a more
extensive correlation of ratings and critical incidents. Two formal
evaluations have been completed, both supporting the utility of
FRLP, one a controlled field experiment using shop supervisors
and the other a quasi-experimental field study of community
leaders.
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Bass Book 8-9 2/29/96 11:53 AM Page 123
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Shop Supervisors. For a three-day modified FRLP, Crookall

(1989) arranged for the completion of a Solomon four-group
evaluation design to compare FRLP with the Hersey-Blanchard
situational leadership program and two measurement control
samples. The leaders studied were shop supervisors working in
minimum, medium and maximum security prisons in Canada.
The supervisors worked directly with inmates employed in
industrial shops to produce specific products for sale within and
outside the prison systems. Each supervisor was rated by the
inmates attending class in his shop, using a modified version of
the MLQ Form 5. (The form was adjusted to provide a reading
level commensurate with the inmate's education). The experi-
mental design was employed to test the effects of a training
program to increase the transformational leadership of the super-
visors and its resulting effectiveness in various industrial and
vocational shops in the prison system. Significant training effects
were obtained on such outcomes as productivity, absenteeism
and the prosocial behavior of the inmates who worked for
the trained supervisors. Specifically, compared with untrained
supervisors, trained supervisors were found to be more effective
_^:^_ leaders on a variety of specific measures of organizational _rx_
T and individual level outcomes. More dramatic effects were ^
reported for FRLP than for situational leadership although both
forms of training were found to improve the shop supervisors'
performance.
The performances of both trained samples improved, but
in comparison to the three other groups of supervisors, those
who were trained in transformational leadership did as well or
better at improving productivity, absenteeism, and "citizenship"
behavior among the inmates; they also won more respect from
the inmates.
Community Leaders. A large-scale quasi-experimental pre-
post evaluation was reported by Avolio and Bass (1994). At the
time of the completion of the evaluation, covering a three-year
period, a total of 489 participants in the vicinity of Binghamton,
New York had finished the Basic Workshop and 400 participants
had completed the full program of the Basic and Advanced Work-
shops. They came from 183 organizations in the area served. A
sample of 66 of the 400 had completed the follow-up module
six months to two years after the Advanced Program. Addition-
ally, 105 had completed post-assessment evaluations at this time.
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Interviews, open-ended questionnaires, and structured ques-

tionnaires of participants and their colleagues were methods used
to evaluate the efforts. Participants were drawn from ten sectors of
the community. Pre-test, post-test, and follow-up data included
self-ratings and ratings from colleagues about the leadership,
organizational culture, and performance on the job. Also, consid-
erable biographical data, personality data, and leadership perfor-
mance data were collected before, during, and following training.
It was also possible to complete some analyses of change as a con-
sequence of the training effort.
The 66 participants who attended the follow-up module ses-
sions had been rated more transformational according to MLQ
results than those who did not attend. All had finished the
Advanced Workshop at least six months earlier. A limited num-
ber were invited and many did not attend because of conflicts
in schedules. This created a "ceiling effect" which attenuated
the overall effects of training. However, the sample of 66 was no
different in age, sex, education type of organization from which
they came (government, industry, education, health care, etc.)
than the 489 who had completed the Basic Program. ,
T^ Figures 6 and 7 show the changes in MLQ self-ratings and ~^~
ratings by followers from before Basic training to the follow-
up module. As seen in Figure 6 a significant increase of .26 of
a standard deviation occurred for self-rated inspirational moti-
vation, .14 for intellectual stimulation and .23 and .26 for
inspirational motivation and intellectual stimulation as assessed
by over 300 subordinates. As expected, the biggest transactional
shift occurred for managing-by-exception, which was reduced
by 11 percent of a standard deviation according to self-ratings and
over a half a standard deviation (59%) according to subordinates.
Rate-rerate comparisons are unlikely to show such changes and
while self-ratings may reflect the bias of expectations from atten-
dence in the training, pre-post subordinate ratings of subordinates
back on the job are unlikely to be contaminated.
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FIGURE 6
Standardized Change in Leadership Styles According to
Self-Ratings From Before to After Training of the Leaders
in the Full Range of Leadership Program (N = 87)
■
II IM IS IC CR MBE LF
0.4
0.26
0.23
0.06 0.07
0.02 II — Idealized Influence
0.01
0 | IM-- Inspirational Motivation
11
IS-- Intellectual Stimulation
IC-- Individualized Consideration
-0.2 CR-— Contingent Reward
MBE — Management-By-Exception
■
LF-- Laissez-faire
-0.4
-0.6
-e- -0.59
-e-
Pinpointing the gains made more specifically was the deter-

mination that an MLQ component rose from before the Basic to
the follow-up module only if the component had been included
as a goal of the participant's Leadership Development Plan in
Module 4. For instance, intellectual stimulation rose from a mean
of 2.53 to a mean of 2.91 if it was a stated goal of the Leadership
Development Plan. If it was not, it remained unchanged at 2.74
before and 2.77 at the follow-up. The same effects appeared for all
the other components of transformational leadership.
A plurality of participants stated that implementation of
their Leadership Development Plans was aided by their own
motivation, by their colleagues (34%), by knowledge obtained
(13%) and through feedback (12%). Lack of self-discipline and
time pressures were mentioned as the factors most inhibiting
implementation of leadership development plans.
<>
Bass Book 8-9 2/29/96 12:33 PM Page 126
<>
Built into FRLP were several surveys whose data were fed
back to the participants and also provided normative information
about the constraints on learning and applying transformational
leadership. For example, the 489 participants hesitated to dele-
gate if they were women working in government agencies (sur-
veyed at the beginning of Module 6). Generally, hesitation to
delegate (and to be more individually considerate) was a matter
of the tendency of the leaders to be task oriented rather than
oriented to the development of their subordinates. The leaders
hesitated to delegate because the task was too critical. It took too
long to train the subordinate. The leader could do the job faster
and better. The half of the sample of 489 who were men and
who completed Module 11 saw many more stumbling blocks
to intellectual stimulation than did the women participants.
Those from the industrial sector appeared more prone to such
stumbling blocks.
FIGURE 7
Standardized Change in Leadership Styles According to
<> 3-5 Subordinate Raters From Before to After Training of Their
Leaders in the Full Range of Leadership Program (N = 87)
-e
II IM IS IC CR MBE LF
0.4
II — Idealized Influence
IM-- Inspirational Motivation
-0.01 IS-- Intellectual Stimulation
IC-- Individualized Consideration
-0.12 CR-— Contingent Reward
MBE — Management-By-Exception
LF-- Laissez-faire
-0.53
-0.6
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Bass Book 8-9 2/27/96 2:32 AM Page 127
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Acknowledgements 127
Open-Ended Participant Commentary

Evaluative Comments. Open-ended evaluative comments
were obtained from the 66 participants of the followup module,
six months to two years following their attendance in the Basic
and Advanced Programs. Of all the comments 75% were positive,
23% were neutral, and 2% were negative.
Examples of comments were as follows:
• Surprised to reflect back on how much I have changed and
influenced changes in my organization.
• Gave me the opportunity to make and strengthen conceptual
connections and apply to past and present situations.
• Additional MLQ feedback is very valuable.
• At the conclusion of this session, I strongly feel that the
Transformational Leadership Development Program has
changed, for the better, my way of being a leader.
• It was nice to see that what I learned and put in place
was effective.
• Felt this was a valuable session as in many cases of change,
,-. there is no follow-up on the success or failure of the new
(V implementation. -(£)-
• Would like renewal sessions on a periodic basis.
• Would like sessions to be held more often with specifically
defined and limited agenda.
• I need periodic review and refresher.
• Too rushed—tried to do to much in a short time.
Open-ended statements by the participants in the follow-
up module of their most significant accomplishments that had
occurred involved issues of charisma, 5%; inspirational motiva-
tion, 14%; intellectual stimulation, 29%; individualized consid-
eration, 42%; and contingent reward, 10%.
Most Significant Accomplishments. These included the
following comments:
• Seeing growth in a new manager—her increased professional-
ism and in another, an increased capacity for risk-taking.
• I've made a real attempt to have more frequent staff meetings
in spite of the lack of time.
• I've developed an individualized development plan for each
staff member that's a little more specific than we had in
the past.
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• Gaining respect of a colleague.

• Sharing goals and making them a part of our overall planning
and information sharing.
• I felt that I wasn't using symbols to communicate my ideas
that a leader should be using. The other night we were
honoring a retiree. I compared her to a gem, being shiny, being
precious, being of value, and I can't tell you how many
people came up to me afterwards and commented how that
brought the whole evening together.
• The best thing that the program gave me is confidence.
• Getting my people to be more risk-taking.
• Our vision statement was written down and decided upon by
the entire group. We were able to agree on four or five values
that we all shared.
• I am a stronger but softer leader.
Lack of resources. These figured in 25 percent of the com-
ments about what hindered carrying out the leadership plans
developed during the training program.
• Lack of funds, budget cuts and continuing need to find funds.
(T\ • Lack of time to learn new skills. (t\
• Lack of time to allow people to get together to plan or decide. ^
• Lack of time to reach pockets of resistance.
• Day to day workload.
Resistance to Change. These comments figured in 24 percent
of the obstacles to carrying out one's development plan:
• Old ways worked ...why change?
• Organizational vision has not been firmly established.
• My own feelings of having to be all things to all people.
• Inability to imagine that women are managers and have
overall responsibility for an operation.
• Everyone looking out for themselves.
• I feel uncomfortable with a new approach to my work.
• What organization says and what is actually done are two
different things.
• People afraid to take risks.
• People are losing their jobs ...why should I expect them to take
risks and put their job on the line?
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Bass Book 8-9 2/29/96 12:35 PM Page 129
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Other Comments. Other blockages to carrying out one's lead-

ership development plans included: lack of support, 12%; priori-
ties, 12%; lack of self-discipline, 13%; lack of recognition, 6%
and miscellaneous other reasons, 7%.
Seventy-five percent said that relationships had gotten better
with their boss, their colleagues and their subordinates as a
consequence of the program; only 2% to 11% indicated that they
had gotten worse. In response to direct questions, 80% said the
program had been well worth their investment in time and
energy; 90% were satisfied with the application of the FRLP
transformational-transactional leadership model to their own
overall development.
Satisfaction With FRLP

Similar to what we had found with 400 participants, a great
deal or fairly much satisfaction with the overall training program
rose from 88% to 92% from the end of the Basic to the end of
the Advanced Program for those responding in the followup. All
individual modules were seen to be satisfactory and important,
(t) but the highest ratings here were given to Module 4 involving fk
T MLQ feedback and the Leadership Development Plan. ^
In Section 4, we already noted that the organizational
cultures which are learned about in Module 12 are rated in the
followup as more transformational and more transactional by the
subordinates and colleagues of the participants. The leaders
themselves see their organizations becoming more transforma-
tional but not more transactional.
Other Subjective Evaluations. Subjective outcomes of a high
degree of satisfaction with the FRLP immediately at the end of the
Advanced program have been found for upwards of 250 senior
managers in an Italian conglomerate, and from efforts in progress
in a variety of American corporations and educational units. Here
again, hundreds of illustrations of applications and attempted
implementations have emerged in Module 9 dealing with partic-
ipants' reported efforts during the Basic and Advanced programs.
Clearly, the answer to the question, can transformational lead-
ership be effectively taught and learned, is affirmative. Can it be
predicted? This is the question to be answered in the Section 9.
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SOME NEW DIRECTIONS

Other Programs
Other FRLP scheduled programs to train transformational
leadership can range from intensive one-on-one sessions with
each of the members of an organization to briefer workshops held
on 3 to 5 consecutive days over an extended period of time. In
all instances, the nature of follow-up back in the organization is
critical to the transfer of training. An internal OD consultant can
be important to the change process.
There are many ways that the MLQ can be used by OD
consultants. The primary advantage of the measure is that it taps
constructs that can be dealt with at the individual, group and
organizational level.
Training Transformational Teams

As many organizations are changing from a steep hierarchi-
cal structure to a flatter one with fewer levels and lateral multi-
functional networks are being stressed, teams are being formed
-(h- to identify problems and propose solutions. High-performance (f)
^ teams are sought. While teams may make better decisions and ^
increase commitment, the team leadership may over time include
all members sharing the leadership to some extent. All team
members may need to develop the ability to facilitate, to coach, to
mentor, and to teach and delegate to develop others. Knowledge
of group processes is important to all the team members. High-
performance team members display transformational leadership
toward each other.
The Model of Expectations. When individuals are working in
unstructured collectives, they are working below expectations as
a group. When individuals are working in structured groups they
are working at expectations. The individuals in structured groups
have well-defined roles. They are working beyond expectations
when they form into highly developed, highly performing teams.
Just as we have been able to describe organizations as trans-
formational or transactional, so can we do the same with
reference to teams, but in somewhat more detail. The members
in unstructured groups display behavior like laissez-faire and
passive management-by-exception leaders. They are laissez-faire
in that they fail to set clear agendas and are confused about
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Bass Book 8-9 2/26/96 10:00 AM Page 131
O
responsibilities. As a consequence, there is disorganization and

conflict among the individual members. The members display
passive management-by-exception toward each other. They wait
for problems to arise and are hesitant to offer ideas. They are
reactive rather than proactive. Members in structured groups dis-
play, in varying degrees, active management-by-exception and
enact constructive transactions. They monitor each other's perfor-
mance for deviations and rule enforcement. There is an unwill-
ingness to take risks.
As members become more constructive they increase
their commitment, cohesiveness, and drive. They become more
focused on their roles and recognition of accomplishments. They
provide agendas, assign tasks, and follow up. They become more
cooperative and perform at expectations.
Members start behaving as a team when they display indivi-
dually considerate and intellectually stimulating transforma-
tional leadership behavior towards each other. They also show
individualized consideration, empathy, and alertness to the needs
of the other members. They coach, facilitate and teach each other
_z:^_ and are willing to engage in continuous improvement. _r\_
In a team, the members are intellectually stimulating. They
challenge assumptions and question the traditional ways of doing
things. They listen to each others' ideas and feel comfortable
offering new ideas. They view problems as opportunities to learn.
In the high performance team, the members inspire each
other. They express optimism, excitement and enthusiasm about
the future of the team. They are confident that the team has the
talent and the experience to meet and exceed its most challenging
goals. They parallel the individual concept of charisma in that
the members show a high degree of unity, pride in the team,
loyalty to the team, cohesiveness and commitment to the team's
mission. The members are confident about the competence of
each other and their trust in each other. They believe in the
dependability, reliability and integrity of each other and the team
as a whole. Members influence each other by helping each other
to align their individual interests with the general purpose of the
team. They sacrifice individual goals for the good of the team.
Members serve as role models for each other.
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132
As team members move toward full agreement on a shared

vision, they increase their level of commitment, become more
cohesive and increase their focus on achieving their team goals.
They become highly productive and achieve more than expected.
Application to Training. The FRLP training program for team
training first provides in a condensed version the individual
training described before. Then team training, following the
theory just presented, is completed in a second workshop.
Ninety undergraduates have completed such team training and
proceeded as teams to pursue community projects of their own
choice. Industrial teams have been trained in the same way but no
formal evaluations have been completed as yet (Avolio & Bass
1993).
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Bass Book 8-9 2/27/96 2:37 AM Page 133
<>
SECTION 9
Prediction of Transformational and

Transactional Leadership
Introduction
Can the tendency to be more transformational be accurately
predicted? If so, how?
In Section 8 we have shown that biodata about parents,
home, school and early work experiences forecast subsequent
transformational leadership and can be justified as additions to
predictive batteries. The Army has biodata instruments such as
BIOLEAD available. To validate them as predictors would become
a matter of correlating the results from such biodata to suitable
ftN criteria of emergence and performance as a transformational _£k
M^ leader. Such has been done by Atwater, Avolio, & Bass (1991). ^
In Section 9, we will present relevant global, individual trait
and combined trait data that were found to be concurrent in valid-
ity or predictive of criteria of components of transformational and
transactional leadership and their effects. The global data come
from observations by peers of performance in what are essentially
initially leaderless group discussions. The trait data come from
self reports on personality scales and the combined reports come
from multiple regression studies.
Agreement Among Raters

Several different approaches have been used to confirm the
reliability and validity of MLQ assessments by examining the
agreement among raters.
Rate-Rerate Consistency. First we need to ask whether trans-
formational leadership is predictable. If we know a leader's MLQ
profile, can we predict the leader's profile at a later date? The avail-
able evidence is supportive. When six months intervene between
the first and second assessments of the MLQ by self and subordi-
nates, Pile (1988) found that the first set of results predicted the
second set with correlations obtained as shown in Table 8.
133
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Bass Book 8-9 2/27/96 2:37 AM Page 134
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TABLE 8
MLQ Rate-Rerate Correlations
Rate-Rerate Rate-Rerate
Self-Ratings Subordinate Ratings
MLQ Scale (N = 33) (N = 193)
Transformational
Idealized Influence
(Charismatic Behavior) .60 .79
Inspirational Motivation .45 .66
Intellectual Stimulation .61 .66
Individualized Consideration .70 .77
Transactional
Contingent Reware .44 .52
Management-by-Exception .74 .61
Laissez-Faire .73 .82
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(From Pile, 1988)
Charisma, individualized consideration and managing-by-

exception appeared to be most predictable.
Subordinate-Superior Agreement. For 107 midshipmen
at the U.S. Naval Academy, Atwater and Yammarino (1993) found
that subordinates and superiors of the focal midshipmen
correlated .35 and .34 respectively for composite measures of
transformational and transactional leadership. Considering that
subordinates saw their focal leaders in a quite different rela-
tionship than did the superiors of the focal leaders, the correla-
tions of .35 and .34 indicated that considerable variance in the
MLQ was attributable to consistent individual differences in the
focal midshipmen.
Peer Ratings Based on Performance in Small Groups. In
Module 7 of the full-range program of the FRLP in transforma-
tional and transactional leadership, participants may use a 21-
item list of items to assess the components of the MLQ model
displayed by their peers in the small groups they have attended
in the preceding Basic Program modules. The mean correlation
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Bass Book 8-9 2/27/96 2:39 AM Page 135
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Prediction of Transformational and Transactional Leadership 135
between the sets, each of three items, dealing with the seven
components of the model of transactional and transformational
leadership correlated .35 on the average with the same compo-
nents of the MLQ as obtained from the participants' subordinates
back on the job prior to beginning the Basic Program.
The data usually remain anonymous and are usually not
gathered, so the small sample available for analysis only could
provide the suggestion that peers and observers may be able to
predict with some validity the transformational and transactional
behavior of examinees placed in a leaderless group testing situa-
tion consistent with Bass' (1954) conclusion that performance in
the leaderless group discussion was positively related to leader-
ship potential, status, esteem and merit. The rationale for such
positive correlations was that the LGD requires examinees to be
cooperative and competitive, often at the same time, mirroring an
important challenge leaders face in everyday circumstances
(Handy, 1994).
Cognitive and Personality Assessments by Colleagues

-Q_ Esteem. Superiors, peers and subordinates can provide 360° _c^_
assessments of the focal leader's esteem—value as a person
to the organization independent of the position the leader occu-
pies. Generally, esteem is a strong predictor of leadership poten-
tial, per se (Bass, 1960). Evidence of its specific predictive power
was demonstrated by Avolio, Bass, Atwater, Lau, Dionne,
Camembreco, & Whitmore (1994). Military cadet company rank-
ing of the esteem of cadets was obtained using peer ratings. Each
military sophomore cadet chose the top five most effective in their
company of approximately 30 cadets. They also chose five least
effective. A sociometric measure of esteem was calculated for
those in top, bottom, and neither groups. Table 9 shows the corre-
lations between esteem and ratings of MLQ received by the focal
cadets from their subordinates and their superiors. From Table 9 it
can be seen that the esteem ratings correlated much higher with
superiors' than subordinates' assessments of the MLQ transforma-
tional and transactional leadership behavior of the cadets. The
negative correlations with the passive management-by-exception
and laissez-faire leadership were in line with expectations.
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Superiors' Recommendations. Yammarino & Bass (1990)

reported results for a 5% representative sample of all junior
officers in the Navy surface fleet. MLQ ratings by subordinates
were associated with earlier superiors' recommendations of the
officers for early promotion and the officers' earlier fitness reports.
Table 10 shows the correlations obtained. With an N of 186, p <
.01, when r is > .19.
It can be seen that the superior's ratings forecast the subordi-
nates transformational contingent reward and active managing-
by-exception and were as expected negatively related to laissez-
faire leadership. Similar findings were reported by Hater and Bass
(1988). Management committee judgments correlated positively
with subordinate MLQ transformational leadership ratings of
Federal Express middle managers and negatively with passive
managing-by-exception.
TABLE 9
Correlations Between MLQ Behaviors and
<> Sociometric Index of Esteem o
Esteem
Followers' Ratings Upper Class Ratings

Leadership/Management of Focal Cadets of Focal Cadets
(N = 180-191) (N = 130-152)
MLQ
Charismatic Behavior .15* .41*
Inspirational Motivation .14* .41*
Intellectual Stimulation -.03 .32*
Individualized Consideration -.05 .32*
Contingent Reward .04 .23*
Management-by-Exception--Active .43* .24*
Management-by-Exception--Passive -.22* -.21*
Laissez-faire -.23* -.27*
*p<.01
(Adapted from Atwater, Lau, et al., 1994)
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TABLE 10
Correlations Between Subordinates Ratings of Junior Officers
and Superiors' Fitness Reports
Early Promotion Fitness
Leadership/Management Recommendations Reports
MLQ Scores
Charismatic Behavior .37* .38*
Inspirational Motivation .28* .25*
Intellectual Stimulation .34* .31*
Individualized Consideration .24* .21*
Contingent Reward .24* .20*
Management-by-Exception --Active .28* .22*
Management-by-Exception --Passive -.04* -.05*
Laissez-faire -.31* -.05*
p<.01
(Adapted from Yammarino & Bass, 1990a)

■o- -&
INDIVIDUAL TRAITS AS PREDICTORS OF

MLQ SCALE SCORES
Both improved conceptualization and improved methodol-

ogy stimulated the return of the trait approach to the study of
leadership in the 1990's. But could we find that there is consider-
able variance in the MLQ profile that can be attributed to individ-
ual differences in traits when in Section 3 we enumerated
contingent situations that make a difference in mean transforma-
tional and transactional leadership?
The Argument
In 1948 and 1970, following his review of the literature,
Stogdill concluded that there were some personal dispositions
associated with leadership such as energy level, cognitive ability,
persistence, and sense of responsibility. Nevertheless, he also
argued that there needed to be a match between the leader's attri-
butes and the needs of the group led. The analysis required atten-
tion to both the leader's individual attributes and the demands of
the situation.
<>
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I concluded that the ANOVA model was the appropriate

description of the person-situation issue (Bass, 1960). Some of the
variance (and covariance) in any analysis is due to the leader as a
person. No matter where you put some people, they will emerge
and succeed as leaders. Universally, we are likely to see more
determination in the personality of transformational than transac-
tional leaders regardless of the situation. Some of the variance is
also due to the culture and organization. The transformational
leader in Honduras has to be more directive than the transforma-
tional leader in Norway. Beyond the main effects, some of the
variance will also be due to the statistical interaction of person
and situation. Saddam Hussein (transformational to many of his
Iraqi partisans) becomes submissive to international authority
when coerced by immediate military force or threat and returns
to domineering whenever the force is lifted or the threat becomes
less credible. The question is an empirical one as to how much
of the variance is due to the three sources: person, situation, and
interaction of person and situation. Multiple levels of analysis are
required for which the statistical methodology is now available
(Yammarino, Spangler, & Bass, 1993).
"XT- Pre-Stogdill, the emphasis was on the person; post-Stogdill, ~0~
on the situation. At the same time, the emergence of organi-
zational behavior as a field and of cross-cultural research was
premised on the expectations that situations would make a
difference. Thus, after Barnlund (1962) had systematically recom-
posed groups with changing membership on successive tasks, he
erroneously concluded that most of the variance in the emergence
of one as a leader was due to the task circumstances. However, in
the 1980's, revised analyses and new evidence turned the tide
back towards the person. Thus, Kenny and Zaccaro (1983) reex-
amined Bernlund's results and found that 49% to 82% of the vari-
ance should have been attributed to the person in Barnlund's
experiment. Many individual traits already have been tried as
predictions of transformational/transactional leadership. We can
present here the smaller number of significant positive empirical
results we have found against the larger array of expectations.
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Bass Book 8-9 2/29/96 12:43 PM Page 139
<>
Some Reported Research

Cognitive and personality dispositions have been correlated
concurrently, retrospectively, and as forecasts of transformational
leadership. In studies where participants have completed person-
ality scales and leadership has been appraised by others, the MLQ
has been frequently the leadership measuring instrument, but
often in a truncated form.
When it comes to predicting transformational leadership and
its components, there is no shortage of personality expectations.
However, the empirical support has been spotty. The cognitive
and personality traits of ascendancy, dominance, conscientious-
ness, internal locus of control, originality, higher moral reasoning,
optimism, self-efficacy, self-confidence, hardiness, and idealism
have all been offered as likely precursors of idealized influence,
charisma and inspirational leadership. Other traits which we
might expect to correlate with transformational leadership, but
which we did not find any reports, include: persistence, vitality,
tenacity, determination, ability to cope with conflicting demands,
proactivity, task orientation, honesty, integrity, knowledgeability,
-Q- credibility and originality (See Kirkpatrick & Locke, 1991). ry_
As we have mentioned in earlier sections, when looking at
charisma and inspirational leadership, it is important to distin-
guish between the socialized and personalized charisma of the
truly transformational and the pseudotransformational leader.
The socialized moves followers toward shared benefits; the per-
sonalized is self-serving (House & Howell, 1992). In all, a pattern
of correlations has been found of only modest proportions.
Community Leaders. Avolio, Bass Atwater, Lau, et al. (1994)
correlated the Gordon Personal Profile (GPP) concurrently with
MLQ profiles for 118 community leaders, half male, half female.
As expected, charisma correlated .21 (p<.01) with GPP ascend-
ancy and .23 (p<.01) with GPP sociability. MLQ inspirational
motivation correlated similarly with GPP ascendancy (.23) and
sociability (.25). Unexpected was finding only a correlation of .03
and .03 between locus of control and the two MLQ measures. For
the same sample, the Myers-Briggs Type Indicator Thinking
(MBTI) scale correlated -.25 (p<.01) and the feeling scale corre-
lated .18 (p<.05) with charisma but insignificantly with inspira-
tion. But inspiration correlated significantly, .20 (p<.05), with
MBTI sensing. Intellectual stimulation correlated .19 (p<.05)
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with GPP ascendancy but unexpectedly did not reach statistical

significance with any of the MBTI scales. Individualized consid-
eration correlated with GPP ascendancy .20 (p<.05) like the other
transformational scales and additionally with sociability, .21,
(p<.01) as might have been expected. Individualized considera-
tion also correlated significantly (p<.05) as follows with MBTI
scales: extroversion (.19), feeling (.19), and lack of thinking (-.22).
As for predictions of transactional leadership, MLQ contin-
gent reward like the transformational components correlated
significantly with GPP scales of ascendancy (.18, p<.05) and
sociability (.23, p<.01). Only the MBTI scale of thinking was
significantly correlated (negatively) with contingent reward
(-.19, p<.05). Laissez-faire leadership was associated with emo-
tional stability (.20, p<.05), personal relations (.21, p<.01) and
original thinking (.16 p<.05).
Air Force Cadets. Forty focal commissioned officers in charge
of 40 cadet squadrons at the Air Force Academy (35 men; 5
women) were assessed by Ross and Offerman (1991) with trun-
cated measures from the MLQ as rated by the cadets within the
-Q- squadrons. A single MLQ charisma-inspiration scale correlated _fx_
T respectively at p<.001 (with exceptions as noted) as follows
with inventoried personality traits measured by the Gough &
Heilbrun Adjective Check List (1983): self-confidence and per-
sonal adjustment, .63; pragmatism, .69; need for change, .39
(p<.01); nurturance, .67; feminine attributes, .54; lack of aggres-
sion, -.47; and criticalness, -.49.
Midshipmen and Cadets. Atwater and Yammarino (1993)
studied composite MLQ transformational and transactional lead-
ership of 99 men and 8 women midshipmen at the U.S. Naval
Academy who served as plebe summer squad leaders. They com-
pleted the MBTI, the Epstein and Meier (undated), Constructive
Thinking Inventory (CTI), and Cattell's (1950) 16PF inventory.
The MBTI Thinking/Feeling scale correlated -.29 and -.30
respectively with subordinates' and superiors' MLQ ratings of
the focal squad leaders (p<.01). The parallel correlations for trans-
actional leadership were .30 and .30 (p<.01). CTI Emotional Cop-
ing correlated -.25 with transformational leadership and -.32 with
transactional leadership according to subordinates' MLQ ratings.
Superiors' MLQ ratings of the transformational leadership of the
squad leaders correlated .22 (p< .05) with Behavioral Coping, -.20
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(p< .05) with Superstitious Thinking, -.26 (p< .05) with Negative
Thinking, and -.26 (p< .05), and .22 (p<.05) with Naive Optimism.
Correlations of the superiors' MLQ ratings of the focal squad
leaders with transactional leadership were all at p< .05 and
were as follows: Behavioral Coping, .28; Naive Optimism, .23;
and Negative Thinking, -.33. (The negative correlation implied
positive thinking.)
Subordinates' MLQ transformational and transactional
ratings correlated .20 (p<.05) and .23 (p<.01) respectively with
the 16PF intelligence scales scores. Superiors' MLQ ratings
correlated .22 (p< .05) and .26 (p< .01) with 16PF Conformity.
Transactional leadership correlated .24 (p< .01) with 16PF
Self- Discipline.
Avolio, Bass, Atwater, Lau, et al. (1994) analyzed results for
141 Virginia Military Academy cadets in their junior year whose
MLQ transformational leadership scores, according to subordi-
nates, were forecast significantly by a large battery of tests and
measures including three scales of Kobasa, Maddi and Kahn,
1 (1982), obtained earlier, of hardiness, .23 (p<.01), .15 (p< .05) and I
"^^ .37 (p<.01). Also important were measures of physical fitness, ~0~
.21 (p<.01).
For the transactional components that correlated with subor-
dinates' MLQ ratings, contingent reward correlated -.18 (p<.05)
with SAT Math, .24 (p<.05) with sensing, and .15 (p<.05) with
overall physical fitness. Results with forecasting laissez-faire
leadership were: SAT Math, .23 (p<.01), BIOLEAD, -.22 (p<.01),
and lower level of moral reasoning on the Rest (1986) Defining
Issues Test (DIT), -.18 (p<.05). The DIT presents six hypothetical
ethical dilemmas. For each dilemma a list of considerations is
provided for determining the right choice to make. Subjects rank
the four most important considerations.
Industrial Executives. Although locus of control (Rotter,
1966) failed to be statistically predictive in the preceding analy-
ses, Howell and Avolio (1993) did find locus of control, as meas-
ured by 13 items from Rotter's (1966) scale, significant in path
coefficients of .33 with individualized consideration, .25 with
intellectual stimulation and .18 with charisma. Gibbons (1986)
also found concurrent validities for locus of control using
Shostrom's (1974) Personality Orientation Inventory (POI). She
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correlated subordinates' MLQ ratings of 20 senior executives

employed by Digital Equipment and the executives' POI scale
scores. Self-assessed inner-direction of the executives correlated
.37 with their subordinates' ratings of the executives' charisma,
.44 with individualized consideration, .33 with inspirational
motivation and .41 with contingent rewarding. But inner locus of
control correlated -.04 with managing-by-exception and -.27 with
laissez-faire leadership.
Self-acceptance correlated .41 with charisma, .46 with
individualized consideration, .43 with inspirational motivation
and .41 with contingent reward but -.19 with management-by-
exception and -.20 with laissez-faire leadership.
Patterns of Traits
Illustrative of the potential of multiple regression for pre-
dicting transformational leadership, Atwater and Yammarino pro-
duced step-wise multiple R's of .53 and .48 from the personality
assessments respectively against subordinates' MLQ ratings of
the squad leaders. For the corresponding predictions of transac-
rK tional leadership, the multiple R's were .57 and .49. As an exam- fh
^ pie of the specification equation for subordinate MLQ ratings the
weighted predictors (standardized betas) were: .05 Behavioral
Coping, -.13 Emotional Coping, +.13 PF Warmth, +.22 PF Intelli-
gence, -.04 PF Conformity, + .16 MBTI Sensing/Intuiting, -.21
MBT Thinking/Feeling, +.30 Varsity Sports.
As we have seen, validities of individual scales tend to
be modest but in optimum combination correlate considerably
higher. This suggests that there is a pattern of personality traits
where each trait may not be highly predictive of leadership poten-
tial by itself but can account in combination with other traits
for as much as 35 percent of the criterion variance in some situa-
tions. The appropriate canonical correlations have not as yet been
attempted to determine the optimum fit between the matrix of
personality traits and the matrix of the various components of
transformational and transactional leadership.
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Uninvestigated Promising Predictors

Untried (or not known to the writer) but likely to have
some validity for predicting transformational leadership is the
Campbell Leadership Index (CLI). Positive correlations would
probably emerge with the CLI Leadership Orientation Scale
involving checking adjectives such as: competitive, forceful,
adventuresome, risk-taking, enthusiastic, inspiring, impressive,
resourceful, savvy, well-connected, insightful, forward-looking,
creative, imaginative, convincing, fluent, active and healthy.
Scales that also might prove predictive include those assessing
consideration, empowering and friendly to predict individ-
ualized consideration as well as credible and optimistic for
the transformational components of charisma and inspirational
leadership.
Other uninvestigated predictors of transformational and
transactional leadership include the newly popular tests of
integrity and honesty (Camara & Schneider, 1994), tests of the
ability to play competing roles, the Persean consistency of belief
and action (Raelin, 1993), working with paradox (Handy, 1994)
(t) and the Orientation Inventory (Bass, 1967). The effort should rh
be driven by the expanding understanding of transformational ^^
leadership and its components. Also to be exploited is the line of
investigation carried out by House and his colleagues (e.g., House,
Spangler, & Woycke, 1991) in which charismatic world class
leaders such as U.S. presidents are significantly discriminated
from counterpart non-charismatic leaders. The discrimination
is by objective analyses of the themes within their inaugural
addresses or themes used by cabinet members' descriptions of
the Presidents' behavior. The validating appraisal of charisma is
from the pooled judgments of historians.
A particularly carefully crafted historiometric study of the
association of destructive behavior that "discriminates" personal-
ized from socialized world class leaders was completed by
O'Connor, Mumford, Clifton, Gessner & Connelly (in press).
Ultimately, tests for prediction could be developed to follow
from these fundamental studies.
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SECTION 10
Rank, Status and

Transformational/Transactional
Leadership
Introduction
Rank and status—the importance and worth of one's posi-
tion in an organization—can be by self-authorization, by election
or by appointment. How do rank and status, the worth of one's
position in an organization, affect the tendency and need to be
more transformational? This question will be addressed first by
briefly looking at the issue of appointment to a leadership post by
^ higher authority. Next examined will be how rank and the level of i
~^3~ one's position in an organization affect the tendency to be trans- ~w
formational or transactional.
ELECTION VERSUS APPOINTMENT
Elected and appointed leaders derive their legitimacy from

different sources: the elected leader, from the members of the
group or organization, and the appointed leader, from higher
authority. No data are available on whether appointment or elec-
tion make a difference but it can be hypothesized that elected
leaders may be more transformational and appointed leaders may
be more transactional. To remain in office, the elected leader must
retain his or her power as a person in the eyes of the followers. If
higher authority appoints the unit leader, it provides recognition,
authority and specific responsibilities likely to make it easier to
provide contingent rewards and to practice management-by-
exception (Bass, 1960).
Self-authorized, emergent leaders may arise also as a conse-
quence of the personalities and characteristics of themselves and
their followers but that is a matter of individual differences dis-
cussed in Section 9. Here the charismatic leadership of the self-
defining, determined leader may come to the fore.
145
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Bass Book 10-11 2/29/96 12:49 PM Page 146
^>
Sources of Power
Ordinarily the elected or appointed leader initially would
be expected to enjoy a relatively high status as a result of his or
her appointment or election to the position of leader. Titles,
perquisites and symbols of office and simple behaviors such as
maintaining eye contact or speaking in a firm voice with few hes-
itations would help to maintain the higher status. Leaders who
are appointed derive authority and power from their position in
the unit and organization. Specifically, appointed leaders would
be expected to have more of French and Raven's (1959) legitimate,
reward, and coercive power than elected leaders. It would be
expected that they could more readily practice considerable
managing-by-exception if they choose. Elected leaders would
be expected to derive their power from their expertise and their
referent power (their esteem as persons) (Ben-Yori, Hollander &
Carnevale, 1983). Of course, both appointed and elected leaders
could be transactional as well as transformational, depending on
their personal predilections and training. They could be success-
ful or unsuccessful as leaders, depending on their ability to func-
tion effectively with their followers and to meet members' ,
T7" important needs. However, early on, it was guessed that the ~0~
elected leader would enjoy advantages over the appointed leader
in charisma and individualized consideration if the appointed
leader was unfamiliar to the followers and did not have the repu-
tation or esteem of the elected leader.
The elected leader may have emerged in a closely contested
election, so much that individually considerate patching-up of
feelings may be needed before the leader and group can go ahead.
Furthermore, the elected leader's advantage would disappear if
the elected leader was unable to function effectively in the role.
The followers' strong expectations for an elected leader might
intensify their dissatisfaction should the leader fail.
An appointed leader who was effective would need to over-
come any resistance to being appointed rather than elected. In the
long run, the appointed leader should not have to rely heavily on
the formal authority derived from the appointment to manage-by-
exception. Rather, the authority should be used to be more proac-
tively transformational and rewarding.
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Rank, Status and Transformational/Transactional Leadership 147
Dealing With Follower Expectations

Whether elected, appointed, or self-authorized, the leader
would need to recognize that followers have shared expectations
about their leader's characteristics and behavior; their percep-
tions of leader actions are influenced by these beliefs. The leader
would need to be individually considerate and to understand
followers' expectations of him or her. If, for instance, followers
expected the leader to be a strong advocate when representing the
followers' views to higher authority, but the leader failed to do so,
he or she would lose esteem and referent power in the eyes of his
or her followers despite his or her expertise in performing other
functions. Followers might falsely conclude that the leader would
fail to meet expectations in other areas. The appointed leader,
in particular, would need to build and maintain credibility with
followers, unlike the more familiar elected leader.
Some Indirect Evidence. The relation between status or rank
and the display of transformational or transactional leadership
was gauged indirectly in an unpublished study by Atwater and
Yammarino (1989) who asked 285 employees reporting to 118
appointed supervisors in 45 smaller organizations to complete the
^> -&
MLQ (Form 8) about their supervisors. The investigators also
asked for ratings of the supervisors on 36 items about the bases of
the supervisors' power.
We can infer the positional status of the supervisors from the
extent their bases of power were, as conceived by French and
Raven (1959), legitimate (has authority to give you tasks or assign-
ments), reward (can provide important benefits and advantages),
or coercive (can get you dismissed from your job). These were in
contrast to having personal bases in expert power (has expert
knowledge in how to do your work) and referent power (has per-
sonal qualities you admire).
Table 11 shows the results obtained. The more the appointed
leaders had legitimate power, the more they were transforma-
tional. In line with expectations, they practiced active, but not
passive, management-by-exception. They made use of their
rewards but not their coercive power.
Here then, we did see an effect of status accruing from one's
supervisory position. Those with more legitimate and reward
power from their positions as superiors rolled out more transfor-
mational leadership although less transactional leadership and
were less likely to display laissez-faire leadership.
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Table 11
Power Related to Transformation/Transactional Leadership
Passive
Status Differences Transformational Contingent Active Management-
Reflected in: Leadership Reward Management by-Exception
Legitimate Power .32** .13** .19** -.22**
Reward Power .45** .39** .10 -.25**
Coercive Power -.03 .02 .14* -.01
* p< .05; **p< .01
(Adapted from Atwater & Yammarino, 1989)
Physician-Patient The physician-patient relationship can be

■e- described as a leader-follower relationship where the physician is -&
accorded legitimate authority by the patient. The legitimate
authority of physicians allows them to relate to their patients in
transformational ways when the patients must change and adapt
to new realities. For example, instead of fostering denial in termi-
nally ill patients by presenting the distressing news announc-
ing the fatal diagnosis all at once, they can pace and sequence
the information to buffer the stress and organize the support
services to help the patient adapt to the realities (Heifitz, 1994).
This sequence and pacing was seen in how President Lyndon B.
Johnson handled the introduction of Civil Rights legislation in
1964 in the face of Southern filibustering in Congress. The adap-
tive challenge had to be identified by the President, the distress
"regulated," attention directed to the issues, and responsibilities
shifted from imperious federal power to the adapting public.
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ORGANIZATIONAL LEVEL AND

TRANSFORMATIONAL/TRANSACTIONAL LEADERSHIP
Burns' (1978) seminal introductory book on the transforming

leader was about leadership of organizations, political entities,
and movements. When I began gathering interview and survey
data in 1980, it was data from senior executives and U.S. Army
colonels describing their leaders. We discovered by 1985 that
transformational leadership could be displayed by middle man-
agers, Army non-coms and lieutenants, first-level supervisors,
and team leaders with no formal rank in the organization. By
1992, it was clear from empirical evidence that transformational
leadership could be exhibited by housewives active in a commu-
nity (Avolio & Bass, 1994) as well as CEO's (Yokochi, 1989), Army
colonels (Bass, 1985), world class leaders of movements (Bass,
1985), and Presidents of the United States (House, Spangler, &
Woycke, 1991). Also, as we began to work towards transforma-
tional teams (Avolio & Bass, 1993) it became clear that every
member on a team could learn to be transformational.
_£ y. Effects of Rank and Status in the Military

-&
A major question in the military has been whether to lead or
to manage. (In our terms, whether to be transformational or trans-
actional). Roberts (1980) declared that an Army officer needed to
be both a manager and a leader. Furthermore, Roberts felt that
more leadership (transformational) was needed up to the level of
the division commander (Major General), where management
skills become of equal importance. In the field, according to
Roberts, the officer is part of a hierarchy "uncertain of its role
(and) irresolute in supervision of established goals which them-
selves are suspect" (Boyd, 1988). Battles can be lost because of
lack of management but leadership is necessary if they are to be
won (Bussey, 1980). In combat brigades, "statistical based effi-
ciency" can be dangerous (Sorely, 1979). General George S. Patton
quipped that "Leadership is the thing that wins battles" (Anon.,
1985, p. 21). It may be that relatively more transformational lead-
ership is required in combat by the squad corporal than the
general dealing with strategy and logistics.
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Bass Book 10-11 2/29/96 12:52 PM Page 150
^
U.S. Army Colonels. Bass (1985) provided mixed findings

about the effects of rank in the U.S. Army on transactional/
transformational leadership displayed. When it came to extra
effort, no difference was found between a sample of 189 colonels
and 72 lower level officers, each describing their superior. The
impact on their extra effort of transformational leadership seen in
their superiors was the same for both samples (37% and 36%).
But effectiveness was enhanced more (48%) by the transforma-
tional leadership observed in their superiors by the colonels than
by officers at lower levels (27%).
NATO Field-Grade Officers. A total of 372 American, Cana-
dian, and German field-grade officers serving in NATO completed
the MLQ about their immediate superior. Response rates from
the 600 solicitations varied from the highest of 88 percent for
Canadian majors to the lowest rate of 36% for German colonels.
While significant differences according to nationality occurred,
the ranks of major, lieutenant colonel and colonel did not show
much difference.
Charisma-inspiration means were for major, 2.5; for lieu-
-Q- tenant colonel, 2.5; and for colonel, 2.6. For intellectual stimula- _r^_
^ tion, they were respectively, major, 2.4; lieutenant colonel, 2.5; ^
and colonel, 2.6. For individualized consideration, they were
likewise respectively for major, 2.4; lieutenant colonel, 2.5; and
for colonel, 2.6 (Boyd, 1988).
The American officers' means tended to be the highest
for each of the transformational factors (2.7, 2.6, and 2.8), the
Canadians' means in the middle (2.6, 2.6, and 2.4) and the
German means the lowest (2.2, 2.4, and 2.5). All three nationali-
ties gave themselves significantly higher self-ratings than they
gave their superiors. However, this difference was not attributed
to the rank of the officer rated, but to the general tendency to
overvalue themselves (Bass & Yammarino, 1991).
U.S. Navy Lieutenants and Captains. In the same way as
Boyd, Yammarino and Bass (1990a) found little difference in the
mean MLQ profiles of their 186 lieutenant, j.g's in the U.S. Navy
Surface Fleet, rated by their subordinates and 318 Naval captains,
rated by their immediate superiors (Deluga, 1990,1991).
The mean results are shown in Table 12.
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TABLE 12
Ranks of Naval Officers Related to Their Subordinates
Multifactor Leadership Questionnaire

(MLQ) Ratings
186 Nav
Y 145 Senior
Ensigns and 157 Senior Navy
Lieutenant, j.g.'s Naval Officers Officers
Transformation al
Charisma 2.40 1.97 2.18
Inspirational Leadership 2.26 2.30 2.27
Intellectual Stimulation 2.47 2.22 2.37
Transactional
Contingent Rewards (Promises) 1.61 1.34
Contingent Rewards (Rewards) 2.38 2.17 2.08
Management-by-Exception —Active 2.65 2.48 2.48
Management-by-Exception—Passive 2.26 2.37 2.45
Nonleadership
O Laissez-Faire 1.31 1.37 <>
(Adapted from Yammarino & Bass, 1990a; and Deluga, 1990, 1991)
As seen in Table 12, rank generally did not make as much dif-
ference as might have been expected and was in the reverse of
expectations. Deluga (1990, 1991) obtained the MLQ ratings of
two independent samples of senior Naval officers attending the
Navy War College who were asked to describe their own immedi-
ate superiors. Yammarino and Bass (1990) provided the results on
most of the same military form of the MLQ for 186 Navy ensigns
and lieutenant, j.g.'s described by their immediate subordinates.
The junior Naval officers were described as more charismatic
(2.40) than the senior officers (1.97, 2.18). They were no different
in inspirational leadership (2.26 vs. 2.30, 2.27), a bit higher in
intellectual stimulation (2.47 vs. 2.22, 2.37) and individualized
consideration (2.50 vs. 2.30). While there was no difference in
aissez-faire leadership between the junior and senior officers
(1.31 and 1.37), the junior officers were rated as more transac-
tional by their subordinates. Contingent promises were greater
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(1.61 for the junior officers vs. 1.34 for the senior officers), con-
tingent rewards were greater (2.38 for the junior officers vs. 2.17
and 2.08 for the senior officers), and active management-by-
exception was greater (2.65 vs. 2.48 and 2.48). However, passive
management-by-exception appeared possibly a bit higher among
the senior officers (2.26 for the junior officers vs. 2.37 and 2.45 for
the senior officers).
Civilian Results
New Zealand Administrators and Management Personnel.
The first civilian findings were reported by Bass (1985) for two
samples from New Zealand. For a sample of 45 business profes-
sionals and managers describing their superiors with the MLQ
(Form 4), the following non-significant correlations were obtained
between the organizational level of the leader being rated and
their MLQ scores: charisma, .23; intellectual stimulation, .15;
individualized consideration, -.22; contingent rewards, .14 and
management-by-exception, -.21. A different pattern of results was
obtained, again not statistically significant, for 23 educational
administrators. The correlations with organizational level were: ,
vT- charisma, -.18; intellectual stimulation, -.04; individualized con- -&■
sideration, -.16; contingent reward, -.04 and managing-by-excep-
tion, -.26. The conclusion was that if the rank of a leader did not
make much of a difference in his or her MLQ scores, the pattern of
the scores was contingent on whether the leaders were in busi-
ness or educational administration.
MLQ (Form 4) data were collected about an additional 56
New Zealand first-level supervisors and their second-level man-
agement superiors by Bass, Waldman, Avolio and Bebb (1987).
Table 13 shows the comparisons. Here the pattern obtained sug-
gested that higher level leaders evidenced more transformational
leadership and contingent reward and slightly less management-
by-exception.
Japanese Civilians. Yokochi (1989) was able to collect MLQ
data on higher level executives and lower level managers, each
described by their subordinates, in 14 large Japanese corporations
and again found little difference in the levels of the focal exec-
utives and managers being rated. Table 14 displays the results.
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TABLE 13
First-Level and Second-Level New Zealand Supervisors
and Managers Compared (N = 56)
First-Level Second-Level
Supervisors Managers
Transformational
Charismatic Behavior 2.60 2.82
Transactional
Management-by-Exception 2.02 1.95
(Adapted from Bass, Waldman, Avolio & Bebb, 1987)
Again, overall, no significance was attached to the rank of the

-&
two samples except possibly in the use of contingent reward more
frequently by the higher level executives (1.78) in comparison to -e-
the lower level managers (1.59).
It may appear reasonable to expect different patterns of trans-
formational/transactional leadership from leaders of different
rank and status at higher, compared to lower, organizational lev-
els. Empirical results suggest that differences of consequence vary
from one type of organizational setting to another. The envision-
ing, enabling and empowering of the general may involve a
broader and more abstract, complex, array of issues than that of
the corporal, but the corporal can show just as much transforma-
tional leadership in dealing with a more concrete and simpler
array of tasks. The transformational/transactional model can be
applied to each. The behaviors may differ although the same con-
cepts are relevant. Nonetheless, it is in a meta-analysis that some
small, but significant, patterns may be discerned.
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TABLE 14
Comparison of Managers and Senior Executives
in 14 Japanese Firms
MLQ Scale
Managers Executives
(N = 60-66) (N = 62-66)
Transformational
Charisma 2.34 2.30
Inspirational Motivation 2.18 2.19
Transactional
Laissez-Faire 1.18 1.29
-e- (Adapted from Yokochi, 1989)

O
Meta-Analytic Results
The meta-analysis completed by Loew, Kroeck, and Sivasub-
ramaniam (1994) was partly described Section 1. The analysis
compared leaders lower in their organizations with those higher
in their same organizations. The analysts examined the differ-
ences in corrected correlations attained for lower and higher lev-
els between the MLQ components and rated effectiveness. For the
2,089 to 4,222 raters, little difference emerged in the correlations
between levels. For the lower and higher levels of status in their
organizations, the corrected correlations obtained by the leaders
from their subordinates' ratings of MLQ scales and effectiveness
for the lower and higher levels respectively were as follows:
charisma, .70, .70; intellectual stimulation, .58, .61; individual-
ized consideration .60, .60; contingent reward, .36, .48; and man-
aging-by-exception, .10 and .12. Contingent reward did appear to
contribute more to effectiveness among the higher level managers.
Some small but significant differences were found in mean
MLQ scores between the upper and lower levels in rank. The
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means for the upper and lower levels are shown in Table 15.
While no mean differences in charisma and contingent reward
appeared between leaders at the upper and lower organizational
levels, it can be seen that leaders at the lower level were judged
by their followers as somewhat more intellectually stimulating
(2.51 vs. 2.41) and individually considerate (2.59 vs. 2.41) than
their upper level counterparts. However, they were also seen as
practicing considerably more management-by-exception (2.45
vs. 2.11).
For the broad array of organizations that were included in
the many samples combined in the meta-analysis, it does not
seem unreasonable to infer that managing-by-exception, at least
in New Zealand and U.S. civilian managers, is likely to be more
frequently exhibited by lower levels of management. A study of
power differences suggest that it is passive rather than manage-
ment-by-exception that is involved.
TABLE 15
-^> Mean MLQ Scores for Upper Level -&■
and Lower Level Leaders
(N = 2,089 to 4 222 subordinate raters)
Organizational Level of Leaders

Lower Higher
MLQ Leadership Scale
Charisma 2.52 2.52
(Adapted from Lowe, Kroeck, et al., 1994)
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SECTION 11
Empowerment and
Laissez-Faire Leadership
Introduction
How is empowerment differentiated from laissez-faire leader-
ship? Empowering leadership means providing autonomy to one's
followers so that as much as possible they can envisage, enable,
direct and control themselves in carrying out their responsibilities
in alignment with the goals of their leader and the larger organiza-
tion. Laissez-faire leadership means autonomy of one's followers
obtained by default. The leader avoids providing direction
and support, shows lack of caring for what the followers do and
^k abdicates responsibilities by burying himself or herself in busy- X.
~W~ work, deflecting requests for help, abdicating any responsibility ^
for follower performance and/or absenting himself or herself
from the scene physically and/or mentally. Empowerment is
widely touted for its effectiveness, particularly where followers'
commitment, loyalty and involvement are sought. Empowerment
is a product of individualized consideration. Laissez-faire leader-
ship is the epitome of ineptness and ineffectiveness and is nega-
tively related to the components of transformational leadership.
Factorial Independence
In an as yet unpublished analysis, the MLQ scores of 1,152
subordinates' ratings on 10 items of what had been thought to
be a single factor of laissez-faire leadership were factored. Two
independent factors emerged. The first was a factor of six laissez-
faire items with a coefficient alpha of .74 and the second was a
factor of three items of empowerment with a coefficient alpha
of .43. A laissez-faire item was "he/she is absent when needed."
An empowerment item was "he/she avoids telling me how to
perform my job."
157
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Consistent with the above, in another as yet unpublished

effort, when each of the MLQ components were factored for by
itself for 1,053 raters in an Italian conglomerate, five of the com-
ponents could be subdivided. Inspirational motivation divided
two factors: encouraging and setting high standards; contingent
reward, into commendations and rewards; management-by-
exception into active and passive; and laissez-faire into absent-
avoidant and empowering.
Military Examples
To illustrate what is meant by empowerment, let's look at
the transformational leadership of two commanding generals: one
in the U.S. Air Force and the other in the U.S. Army. Devilbiss
and Siebold (1987) presented these two examples of transforma-
tional leadership by commanding generals and their empowering
effects on an air command and an Army corps.
When General W. L. Creech assumed command of the U.S.
Air Force Tactical Air Command (TAC) he began with intellectual
simulation. "He started by simply allowing himself to think in a
(t) different way" (p. 7). He saw the policies of centralization and con- fk
^ solidation were dehumanizing. He focused on TAC's end-of-the-
line product: TAC aircraft and the people responsible for them. He
restructured the organization by moving authority and responsi-
bility downward to meet clear and simple goals to instill pride,
enthusiasm, a sense of ownership and psychological investment in
their product by those responsible. Individualized consideration
was emphasized in treating people's needs and working condi-
tions at all levels as important.
Smaller squadron multifunctional repair teams replaced the
larger wings. Squadrons were assigned responsibility for specific
aircraft. Squadron colors and crew chiefs' names were painted on
the aircraft just as the pilots' names were. "Excellence became
an obsession" (Finegan, 1987, p. 46). Dramatic improvements
occurred in sortie rates and aircraft mission capability. In pro-
viding a professional environment, workers developed pride of
ownership and took more responsibility through their motivation
to do so. Management control became less managing-by-excep-
tion and more a matter of transformationally inspired and
empowered worker motivation (Finegan, 1987).
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Bass Book 10-11 2/29/96 1:01 PM Page 159
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Empowerment and Laissez-Faire Leadership 159
The second example was General Walter Ulmer's enhance-

ment of the readiness of III Corps at Fort Hood. He restructured
the Corps through much delegation of authority, responsibility
and accountability. Featured in the "Greenbook" of the new poli-
cies he set, and tips for leaders at all levels, was keeping "priori-
ties, goals and objectives constantly in focus." An individually
considerate climate of support, clear standards and trust was pro-
moted by encouraging organizational consistency, professional
education and attention to the needs of the individual soldiers
and their families.
The effects of the transformation at Fort Hood were "greatly
affected by each individual in the chain of leadership through
whom information and power passed" (CATA, 1986, p. 17).
Effects noted in just a few months of the changeover were
increased combat effectiveness of battalions, higher standards of
discipline, stronger unit identity, caring leadership, improved
teamwork and military professionalism. The leadership of the
officers was seen to have improved in information sharing, loyalty
to the organization, intellectual stimulation of subordinates,
setting moral standards and good examples, and assuming ,
~w responsibilities (Malone, 1985, p. 12). Objective improvements -&
ranged from more effective utilization of soldiers and reduction in
accidents. The fundamental mechanism underlying both the TAC
and Fort Hood transformations was empowerment.
Empowerment and Superleadership

Superleadership was seen as the ultimate vehicle for empow-
erment. The empowering superleader educates his or her follow-
ers so that each learns how to act as a self-leader. Behavioral-
focused and cognitive-focused strategies are employed to lead
yourself.
The following lists the behavior-focused and the cognitive-
focused strategies. A behavioral strategy, for example, is selecting
a specific behavior that you want to change. A cognitive-focused
strategy is considering what is naturally rewarding about the
work you do.
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• Behavior-Focused Strategies
Self-Observation—observing and gathering information about
specific behaviors that you have targeted for change.
Self-Set Goals—setting goals for your own work efforts.
Management of Cues—arranging and altering cues in the work
environment to facilitate your desired personal behaviors.
Rehearsal—physical or mental practice of work activities
before you actually perform them.
Self-Reward—providing yourself with personally valued
rewards for completing desirable behaviors.
Self-Punishment/Criticism—administering punishments to
yourself for behaving in undesirable ways.
• Cognitive-Focused Strategies
Building Natural Rewards Into Tasks—self-redesign of
where and how you do your work to increase the level of
^ natural rewards in your job. Natural rewards that are part of ^
M^ rather than separate from the work (i.e., the work, like a U>
hobby, becomes the reward) result from activities that cause
you to feel:
a sense of competence,
a sense of self-control,
a sense of purpose.
Focusing Thinking on Natural Rewards—purposely focusing
your thinking on the naturally rewarding features of your work.
Establishment of Effective Thought Patterns—establishing
constructive and effective habits or patterns in your thinking
(e.g., a tendency to search for opportunities rather than
obstacles embedded in challenges) by managing your:
beliefs and assumptions,
mental imagery,
internal self-talk.
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When Empowerment is Needed

Empowerment is not for every organization. Organizations
have a life cycle: entrepreneurial beginnings, growth, maturity,
and decline. If the organization survives in a renewal, the
stages continue with restructuring, dismantling the bureaucracy,
employee involvement, continuous improvement, and cultural
change. At each stage, leadership requirements may differ. The
leader of renewal after the breakup of AT&T had to shift the
thinking of the norms of its employees from concentrating on the
organization as a service to an organization needing to meet the
challenges of the marketplace and competition. But particularly
important in accomplishing renewal is replacement of traditional
control measures by empowerment of the work force which, with
its commitment to renewal, brings on more self-planning, self-
direction and self-control—an approach first presented by Myers
(1966) as "every employee, a manager."
The Dark Side of Empowerment

Generally, empowerment has negative consequences when
.zx_ the followers' goals are out of alignment with the organization's _fx_
^ goals. Empowerment also can have negative consequences when ^
the followers' goals oppose the organization's goals. Empower-
ment of followers may provide them with the opportunity to sab-
otage the organization. Empowerment may generate inflexible
norms that are detrimental to the organization's and the individ-
ual follower's creativity.
While the philosophically bright side of empowerment is to
increase productivity, efficiency, overcome resistances to change,
and increase the sense of ownership and responsibility, its
dark side is its potential to be seen as paternalistic. According
to a British scholar, "It's 'Thatcherism' clothed in the warmth of
humanistic language." It is suggested that for the leader to
empower the follower does not imply sharing of power, but the
maintaining of an imbalance of power between leader and fol-
lower. The follower becomes more responsible for failures. The
leader can take back the gift. In its encouragement of self-actual-
ization, empowerment fosters self-interest rather than goals that
go beyond the individual follower (Alimo-Metcalfe, 1994).
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Bass Book 10-11 2/27/96 3:29 AM Page 162
<>
As for empowering managers, those of lower ranks and status

find more barriers to such empowerment according to Howard
and Wellins (1994). They surveyed 61 senior leaders and man-
agers, 317 lower level leaders and managers and 904 associates.
The associates did not have anyone reporting directly to them.
Although nominally a study of high involvement, the survey
questioned how much the organization involved all levels of
employees as true partners in achieving its objectives for "high
involvement organizations empower their employees by pushing
down decision making responsibility... They share information,
knowledge, power to act and rewards throughout the work force"
(p. 4).
Efforts of Level. First, Howard and Wellins found that the
higher the organizational status of a respondent, the less
frequently they found barriers to be highly involved in their work
for the organization. The lower their status, the more they felt
that the organization's and their leaders' motives were barriers.
At the same time, the senior leaders/managers, as shown in
Table 16, saw considerably more high involvement in their busi-
ness unit than did those of lower ranks in their organizations.
-e- <>
TABLE 16
Relation of Leve. in the Organization and the Perceived
Promotion and Implementation of High Involvement
Extent High Extent High

Involvement Involvement
Promoted Implemented
61 Senior Managers 4.3* 3.8
317 Middle Managers 3.9 3.6
904 Associates 3.3 3.1
*1 = Not at all; 5 = To a very great extent
(Adapted from Howard & Wellins, 1994)
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TABLE 17
Barriers to Empowerment Due to Senior Management
Senior Management as Barriers
Little time/money for change 3.35*
Directive leadership practices 3.22
Insufficient leadership 3.18
Reluctant to share information 3.16
Unclear vision and values 3.11
Not committed to change 3.11
No urgency for change 2.95
*1 = Not at all; 5 = To a very great extent.
Respondents: All categories (N = 1269)
(Adapted from Howard & Wellins, 1994)
As shown in Table 17, senior managers were seen to invest

too little time and money to effect the changes necessary for
-e- empowerment.
<>
Written comments about the dark side of empowerment
included: "Consistent behavior should be a constant of someone
in a leadership role. If this doesn't exist, then trust breaks down,
and the whole ship begins to sink..." (p. 5).
Another important written comment was: "Upper managment
often does not support high-involvement leadership practices
when they have a negative short-term impact on performance"
(p. 2).
In addition to an inadequate amount of trust-building on
the part of management and a lack of trust in them by their
employees, leaders were seen too infrequently taking the roles of
champion and supporter. Subordinates felt unencouraged in that
leaders were only sometimes observed to get higher management
to act on employee's suggestions or to reward employee perfor-
mance with notes, public praise, or visible symbols. Also infre-
quent was to "Blame circumstances rather than employees for
failures." Rather than looking at process and system problems,
leaders often assign personal blame to individuals, a practice that
might discourage risk taking.
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As has been found repeatedly in MLQ research (see Bass &

Yammarino, 1991), Howard and Wellins found a tendency for the
leaders to inflate their self-reports. Leaders also were asked to
describe how often they personally performed each of 22 empow-
ering activities. Each leader's responses were matched to the aver-
age ratings of that leader's behavior by his or her subordinates.
Such comparisons were made for 210 first-level and 56 mid-level
leaders. The leaders inflated their ratings relative to those of their
subordinates, especially in the roles of serving as a model of trust,
champion, change agent, and team builder.
The danger here is that if leaders believe they are better at
empowering leadership than they really are, this could lessen
their motivation to change. Furthermore, subordinates described
themselves as less trustful when the leader's overevaluation was
greater. Thus, leaders who are most out of touch with their subor-
dinates' reports might have greater difficulty establishing trust.
There was disagreement between leaders and their subordi-
nates about the leaders' empowering behavior, particularly in
roles performed behind the scenes or impersonally. Agreement
-£^_ between 266 leaders and their matched subordinates on the rx.
^ frequency of leader behaviors was modest at best. Agreement
between leaders and their subordinates was higher about per-
formance such as envisioning, inspiring and championing and
lower about their relations with other departments and removing
obstacles that hinder employees in doing their jobs.
Delegation was seen to be problematic because some leaders
had problems letting go. They were seen to delegate the respon-
sibility but hold back resources. They asked for input on next
year's budget at the last minute and then didn't use it. Empower-
ment turned to laissez-faire leadership when the leader's work
load increased, "I have too much work to do," "Don't bother
me...." Leaders were seen to fail to provide enough direction and
coordination so that their subordinates remained comfortable
with empowerment.
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THE EMPOWERING LEADER
Transformational Leadership and Empowerment

It is the transformational leader who fosters empowered
followers. Thus, in a survey of two levels of leaders in the U.S.
Army Recruiting Command, Masi (1994) found that the existence
of a cultural norm of empowerment correlated .22 with the trans-
formational style of the station commanders in 53 of the compa-
nies involved. Likewise, self-reported feelings of empowerment
of 240 recruiters correlated .30 with reports of a cultural norm of
empowerment at their stations. Individuals felt more empowered
if their leaders were more transformational (ß = .19) and less
transactional (ß = -.05).
Although Howard and Wellins used different labels, they
were clearly describing transformational and transactional
leadership and its effects. Their empowering leaders were trans-
formational: visionary, inspirational, supportive, championing,
facilitative, etc. They were not transactional "controllers, com-
manders, rulers, judges or guards."
v7~ Empowerment is assisted by the leader's attention to the ~^)"
attractiveness or cohesiveness of the followers or their attractive-
ness to each other. The empowering leader may highlight pending
crises to energize followers into action. The leader will encourage
feelings of warmth and acceptance among the followers.
The empowering leader displays inspirational motivation by
striving to point out the importance of an assignment, the positive
qualities of other followers, and the ways in which they can
complement one another's strengths. The leader points to the
challenge involved and the recognition that success will bring.
The importance of inspirational leadership is illustrated by a
study by Seltzer and Miller (1990). They found a number of trans-
formational leader behaviors that contributed in a medium-sized
human service organization to the organization's mission which
included creating an empowering environment for clients and
staffs. For a total of 194 respondents, followers' sense of self-
efficacy and being intrinsically motivated were positively corre-
lated with the empowering leadership behaviors of their immedi-
ate superior. Correlations were as shown in Table 16. Note that the
highest correlations were with the inspirational goal setting and
the setting of high expectations.
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TABLE 18
Follower Reactions to Empowering Leadership Behavior
Subordinate Reaction
Sense of
Empowering Self- Intrinsic
Leader Behavior Efficacy Motivation
Shared Decision-making .13* .15*
Cohesive team building .16* .18**
Encouragement of individual
development .13* .10
Inspirational goal setting .20** .19**
Fostering of autonomy .10 .14
Setting of high expectations .16* .18**
* p<.05; ** p<.01
■B- (Adapted from Seltzer & Miller, 1990)

-&
Contingent rewards such as commendations and bonuses

may provide tangible reinforcements making use of the empower-
ment.
Countering Groupthink. Empowered followers may redefine
their goals so as to perpetuate their own security and personal
needs as opposed to salutary changes to benefit the organization.
They may avoid introducing disturbing information or disagree-
ing so harmony will be preserved. This groupthink results in the
loss of critical information and creative ideas (Janis & Mann,
1977). To help counter groupthink, uncritical conformity, and
suppression of new or constructive ideas, the leader may intel-
lectually stimulate followers by questioning the followers' think-
ing and assumptions, support followers who voice unusual or
provocative ideas to reduce the conformity and encourage more
flexibility in the norms that may stem from empowerment.
Countering Social Loafing. The empowering leader may need
to use transactional and transformational leadership if empower-
ment results in social loafing by some of the followers. This can
occur when individual contributions are hard to identify.
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Contingent reward, active management-by-exception and

transformational diagnosis and action may be needed to restore
the loafers' commitments and involvements. If "free-riding" by a
follower occurs as a consequence of empowerment in which one
follower shirks work because another is doing it, adjustments in
work loads are needed.
Consulting. Leaders contributing to empowerment were seen
by Howard and Wellins (1994) as moving in the last five years
from more frequently "telling" to more frequently "asking."
Effectively Delegating. In any hierarchical organization the
most common approach to a leader empowering followers is by
means of the delegation process. Avolio and Bass (1991) culled
the literature on delegation and extracted twenty ways to make
delegating more effective.
1. Share problems, offer suggestions and appropriate
alternatives for completing an objective.
2. Give information necessary to do the task.
^K 3. Maintain an appropriate level of personal responsibility. ±
4. Empower follower(s) with the authority to get the
job done.
5. Give support and encouragement as needed.
6. Allocate necessary resources to complete the job.
7. Request progress reports.
8. Review effects of delegated performance.
9. Provide praise and rewards for successfully
accomplishing objectives.
10. Avoid intervening, unless requested to do so by the
follower(s).
11. Delegate the appropriate level of responsibility
and authority to followers based on their needs
and capabilities.
12. Assume that some mistakes may occur before the
follower becomes proficient at the task.
13. Expect that it may initially take longer for the follower
to complete the task than if you did it yourself.
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14. Consider how the delegation of a task to one

follower might affect another follower, a co-worker,
and/or superior.
15. Make sure the task's objectives are clear, specific
and acceptable to the follower.
16. Try to use delegation to manage both performance
and development.
17. Try to delegate tasks to followers that are meaningful
and of interest to them.
18. Explain to your followers why you have chosen
them to do the task.
19. Distinguish initially how much control you want to
retain over the process and product of their efforts.
20. Try not to delegate tasks too often that you would
not enjoy performing yourself.
Self-Defining Leadership. Because self-defining leaders (i.e.,
transformational) are guided by their internal values rather than
-()- their personal needs or by purely external standards, they can and r^_
do base their delegation decisions in a broad context. They con-
sider the long-term goals and interests of the organization, as well
as of the follower, rather than being tied to immediate or short-
range goals. The self-defining leader comfortably delegates auton-
omy to followers to develop them. But unlike self-oriented leaders
who delegate to accomplish certain goals to enhance their own
worth, or relation-oriented leaders who delegate to feel appreciated
by their colleagues and to maintain their own self-esteem, self-
defining leaders are transformational in the confidence with which
they delegate to accomplish higher-order objectives. In the process,
they help to move associates closer to becoming self-defining,
transformational leaders themselves.
Trust. Comments to Howard and Wellins (1994) emphasized
the importance of trust in the leader:
'Being a model of trust was considered the most empowering
leadership role. The empowering leader had to be consistent in
words and actions. Written responses confirmed the importance
of trust.'
If employees trust the management, the teams will be suc-
cessful. If they don't they will think management is trying to
manipulate them....'
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Bass Book 10-11 2/29/96 1:24 PM Page 169
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Value of Empowerment
Although not all empowerment of followers leads to effective
outcomes, there is considerable evidence of pay-off. Cohen and
Ledford (1994) completed a quasi-experiment to assess the effec-
tiveness of self-managing teams in a telecommunications firm.
The teams were involved with customer service, technical and
administrative support, and management. A total of 1,337 subjects
were studied. They included employees, supervisors, managers
and union presidents. Those in self-managing teams were more
effective than those in traditionally managed units doing the
same kind of work. Other examples of improved outcomes from
creating automonous work groups were provided.
Masi (1994) collected MLQ (Form 5X) data on mid-level lead-
ers from their subordinates and from the leaders themselves in
the U.S. Army Recruiting Command. He also gathered data from
the same source on an Empowerment for Quality questionnaire.
The key 17 items included one scale of items which dealt with the
alignment of employee and organization's goals. A second set
dealt with capabilities developed and resources provided. A third
-Q- set dealt with trust, integrity and cooperation. A fourth set dealt _r\_
^ with discretionary authority and latitude. A response rate of 41.5
percent was obtained from the sample of 2,596 prospective
respondents. Commitment to quality as well as motivation to
achieve and to succeed were correlated with perceived cultural
norms of empowerment.
LAISSEZ-FAIRE LEADERSHIP
According to Avolio and Bass (1991), laissez-faire leaders

delay and appear indifferent to what is happening. They avoid
taking stands on issues, don't emphasize results, refrain from
intervening and fail to follow-up. Interviews were conducted
with managers who talked about laissez-faire leaders they had
known. Some of the additional behaviors which came to the fore
were that they avoid making decisions, abdicate responsibilities,
divert attention from hard choices, refuse to take sides in a
dispute, are disorganized in dealing with priorities and talk about
getting down to work, but never really do.
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Bass (1990) pointed to the problems of a popular, but often

laissez-faire "hands off" president, Ronald Reagan. Things went
well if subordinates were competent but poorly if they were
incompetent. The problems multiplied if the subordinate cabinet
member was also laissez-faire. Laissez-faire leadership has been
connected with the reason for low productivity, lack of inno-
vation, more conflict and lack of cohesion among subordinates.
Unlike empowerment, correlations of laissez-faire leadership
for samples of 1,006 respondents describing their leaders (Bass &
Avolio, 1990) with components of transformational leadership
were as follows: charisma, -.56; inspirational motivation, -.49;
intellectual stimulation, -.47; and individualized consideration,
-.55. Conversely, while empowerment correlates negatively with
transactional leadership (Masi, 1994), laissez-faire leadership
correlates positively (.25) with managing-by-exception, but nega-
tively with contingent reward (-.28). Bass (1990) called attention to
the difference between a leader granting autonomy and empower-
ing subordinates in comparison to laissez-faire leadership.
Changing Laissez-Faire Into Empowering Leadership

~xp~ Leaders need to set the boundaries within which subordi- "O"
nates are given discretionary opportunities. Then, the leaders
need to follow up with resources, support, and caring. Thus,
when R&D subordinates were empowered in a study of 21
research teams, but superiors preceded their decision-making
with consultation, the teams were much more innovative sub-
sequently than when there was no consultation with the leaders
beforehand (Farris, 1972).
In an analysis of why Operation Desert Storm was such a
success, Ulmer (1992) pointed to the empowerment of the com-
mander in the field, decisive Norman Schwartzkopf, by President
George Bush and his head of the Joint Chiefs of Staff, Colin
Powell. Equally important were the empowered and committed
junior officers. This was in contrast to how President Lyndon
Johnson had micromanaged the Vietnam War or Ronald Reagan
had articulated a goal for Nicaragua and then stood aloof in
laissez-faire fashion.
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&
In the case of Operation Desert Storm, President Bush, Colin

Powell and headquarters staff focused on a basic strategy and the
garnering of resources. Schwartzkopf, the responsible command-
er in the field, executed the strategy empowered by the distant
higher authority. It was neither the continued meddling of a
President Johnson and his staff, nor was it the "hands off" laissez-
faire leadership of President Reagan.
Most days in the Gulf War, Norm Schwarzkopf and
his boss Colin Powell, the Chairman of the Joint Chiefs
of Staff, had lengthy phone conversations. The comman-
der in the field was probably given some guidance, had
some questions answered, and made requests that were
approved or denied or modified. The latitude given him
notwithstanding, Norm Schwarzkopf operated routinely
within two types of powerful guidelines: the value
system of his profession (differentiating those actions
that were proper from those that were improper); and
the current macro political and resource realities as
defined for him by his superiors. (Ulmer, 1992, p. 5)
(t) Ulmer pointed out that Schwarzkopf himself benefited from fK
^ 30 years of learning, practice and development as well as an
immediately preceding 30 months of planning, team building, and
standard setting that strengthened the organization and its values,
established systems and developed the thousands of leaders at all
levels collectively responsible for the operation's success.
...high-profile, decisive leadership is often appro-
priate but rarely by itself sufficient. Building the team
and... culture over time is crucial. And although empow-
ered and committed junior leaders are essential to orga-
nizational success, a laissez-faire style of leading can be
as dysfunctional as can micro-management by higher
authority, (p. 5)
Situations in Which Laissez-Faire Leadership May Be
Appropriate. On occasion, laissez-faire leadership may be appro-
priate. An issue can truly make no difference to the leader and
only to the parties concerned such as when two co-workers
schedule their individual flex times at work but most problems
call for more attention from leadership or substitutes for it.
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SECTION 12
Substitutes for Transformational

and Transactional Leadership
Are There Substitutes of Consequence for Transformational

Leadership?
The Concept. The concept of substitutes for leadership grew
out of a multiple regression conceptualization. Suppose Y is some
outcome which ordinarily is a consequence of leadership, X^
Then, the standardized regression equation is Y = ^X. The auton-
omy of the follower, X2 might be added to or subtracted from
the equation to predict Y such that Y = ßa Xr ± ß2X2. X2 will be a
substitute or replacement for leadership, X^ if ßj approaches 0.
-O- That is, the outcome Y now becomes X2 alone; thus Y = ßX2. -()-
X2 will be a neutralizer of the leadership, X^ if ß2 becomes nega-
tive and subtracts from the effects of the leadership. Thus, ßÄ -
ß2X2. X2 will be an enhancer of leadership, Xlf if ßl adds to the
effects on Y on the leadership, Xv Thus, Y = ^Xt + ß2X2 (Howell,
Dorfman & Kerr, 1986).
Examples
Numerous subordinate characteristics such as competence;
task characteristics, such as unambiguity; and organizational
characteristics, such as inflexibility, were suggested by Howell,
Dorfman and Kerr (1986) as possible substitutes, neutralizes or
enhancers that would moderate the effects of leadership. Sub-
sequently, supportive anecdotal and survey evidence was found
in a variety of organizational settings: Navy pilots, manufactur-
ing, computerized networks, book publishers, universities, banks,
and police departments. However, when Podsakoff, Niehoff,
MacKenzie, and Williams (1993) completed a systematic survey
and analysis for a large sample of nonprofessionals, they found
that while the substitute variables did make contributions to the
professionals' satisfaction and effectiveness, generally they failed
to moderate the impact of leadership on the outcomes.
173
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-Q-
17A A New Paradigm of Leadership
Podsakoff, MacKenzie, and Fetter (1993) repeated the effort

with 411 professional, managerial and white collar employees in
ten different organizations. Results were similar. The majority of
expected substitutions, neutralizations or enhancements failed
to emerge. Table 19 shows the leadership surveyed and the
proposed moderators employed by Podsakoff, Niehoff et al., and
Podsakoff, MacKenzie and Fetter.
Note that the leadership essentially involved interaction
facilitation, initiating structure, and contingent reinforcement.
The leadership was mainly transactional, consistent with House's
(path-goal) theory and Schriesheim's (1978) supportive and
instrumental behavior scales. Supportive behavior focused on
being friendly and considerate of subordinate's immediate needs.
Instrumental leadership featured role clarification, work assign-
ment and specification of procedures. Contingent reinforcement
included contingent reward and contingent punishment, all
conceived by Bass (1985) as transactional rather than transfor-
mational. Substitutes for leadership were surveyed with a 41-item
scale refined from an original one of 74 items of Podsakoff,
Niehoff, MacKenzie, and Williams (1993). Table 20 shows the 41
\7" items employed. -£^-
Prediction of Outcomes. The outcomes, Ylt included sub-
ordinates' self-reported satisfaction, commitment, perceived role
ambiguity and role conflict. Additional outcomes were the superi-
ors' ratings of the employee performance, altruism, conscien-
tiousness, courtesy, civic virtue and sportsmanship.
As was expected, the constructive leadership behaviors con-
tributed directly to subordinate outcomes. For instance, contin-
gent reward of the superior correlated as follows with subor-
dinate outcomes: .55, general satisfaction; .31, organizational
commitment; -.36, role ambiguity; -.24, role conflict; .27, consci-
entiousness. Likewise, contingent reward correlated with several
potential substitutes as follows: indifference to rewards, -.35; task
feedback, .39; organizational formalization, .23; and cohesive
group, .24.
Neutralize™, Enhancers or Replacements. Of 910 possible
moderating effects on the seven leadership behavior scales stud-
ied, only 13, or 1.4%, had moderating effects that met Howell,
Dorfman and Kerr's (1986) criteria as neutralizes that weakened
or subtracted from the impact of the leader's behavior on out-
comes, or acted as enhancers or replacements. Another 48, or
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Substitutes for Transformational/Transactional Leadership 175
TABLE 19
Substitutes and Other Potential Moderators of Leader Behavior
Will Tend to Serve as Substitutes or

Neutralizers for:
Relationship-
oriented,
Supportive, Task-oriented,
Substitutes and Other People- Instrumental
centered Job-centered Contingent Contingent
Potential Moderators Leadership: Leadership: Rewards Discipline
A. Subordinate Characteristics
1. Ability, experience, training
and knowledge X
2. Need for independence X XXX
3. "Professional" orientation X XXX
4. Indifference toward
organizational rewards X XXX
B. Task Characteristics
5. Unambiguous, routine, and
-e- methodologically routine and -e-
methodological invariant task X
6. Task-provided feedback
concerning accomplishment X X
7. Intrinsically satisfying task X
C. Organizational Characteristics
8. Organizational formalization
(explicit goals and areas of
responsibility) X
9. Organizational inflexibility
(rigid, unbending rules and
procedures) X
10. Highly-specified and active
advisory and staff functions X
11. Closely knit, cohesive
work groups X XXX
12. Organizational rewards
not within the leader's control X X X
13. Spatial distance between
supervisor and subordinate X XXX
(After Howell, Bowen, Dorfman, Kerr, & Podsakoff, 1993)
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Bass Book 12-13 2/29/96 1:47 PM Page 176
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TABLE 20
Revised Substitutes for Leadership Scale
Ability, Experience, Training, and Knowledge

1.1 have the ability, experience, training, or job knowledge to act
independent of my immediate supervisor in performing my duties.
2.1 have all the required ability and experience to be my own boss
on my job.
3.1 have enough training and job knowledge to handle most situations
that I face in my job.
Professional Orientation
4.1 am a member of a professional group whose standards and values
guide me in my work.
5.1 am a member of a professional organization with which I
strongly identify.
6.1 am a member of a professional organization which has a code
of ethics that I believe is important to follow.
7.1 cannot get very enthused about the rewards offered in
this organization.
8. This organization offers attractive opportunities to its employees. (R)
-&
9.1 don't feel that the rewards I receive in this organization are worth
very much. -e-
Subordinate Need for Independence
10. When I have a problem I like to think it through myself without
help from others.
11. It is important for me to be able to feel that I can do my job without
depending on others.
12.1 prefer to solve my work problems by myself.
Unambiguous, Routine, Methodologically Invariant Tasks
13. My job does not change much from one day to the next.
14.1 perform the same types of activities every day in my job.
15. Most of the work I do in my job is somewhat repetitive in nature.
Task-Provided Feedback Concerning Accomplishments
16. My job provides me with feedback on how well I am doing.
17. My job provides me with the feeling that I know whether I am
performing well or poorly.
18. My job provides me with the opportunity to find out how well
I am performing.
Intrinsically Satisfying Tasks
19.1 get a great deal of personal satisfaction from the work I do.
20.1 like the tasks that I perform at work.
21. My job is personally very rewarding.
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Bass Book 12-13 2/29/96 1:52 PM Page 177
£>
Table 20 (Continued)
Organizational Formalization
22. My job responsibilities are clearly specified in writing.
23. Written schedules, programs, and work specifications are available
to guide me in my work.
24. My duties, authority, and accountability are documented in policies,
procedures, or job descriptions.
25. Written rules and guidelines do not exist to direct my work efforts. (R)
Organizational Inflexibility
26. In this organization, violations of rules and procedures are not
tolerated.
27. In this organization anytime there is a policy in writing that fits some
situation, everybody has to follow that policy very strictly.
28. The policies and rules in this organization are followed to the letter.
29. This organization takes a relaxed approach to rules and policies. (R)
Advisory and Staff Support
30. In my job, I work closely with staff personnel who are based outside
my work unit or department.
31.1 often need to obtain information, data, and reports from staff
<> members outside my department to complete my work.
32. Support from staff personnel outside my department is critical to
-e-
success in my job.
Closely Knit, Cohesive, Interdependent Work Groups
33. The members of my work group are cooperative with each other.
34. My work group members know that they can depend on each other.
35. The members of my work group stand up for each other.
Organizational Rewards Not Within the Leader's Control
36. My chances for a pay raise depend on my immediate supervisor's
recommendation. (R)
37.1 am dependent on my immediate supervisor for important
organizational rewards. (R)
38. My immediate supervisor's recommendation is necessary for me to
be promoted. (R)
Spatial Distance Between Superior and Subordinate
39. On my job, my most important tasks take place away from where my
immediate supervisor is located.
40. My immediate supervisor and I are seldom in actual contract or
direct sight of one another.
41. My supervisor and I seldom work in the same area.
Note: (R) denotes reverse coded items.
(From Podsakoff, MacKenzie & Fetter, 1993, pp. 9-10)
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Bass Book 12-13 2/26/96 10:27 AM Page 178
-Q-
5.3%, revealed interacting effects between leadership and

potential substitutes but could not be regarded as consistent
replacement, neutralization or enhancement. While the authors
concluded that few of the results of the Posdakoff, Niehoff, et al.
and Podsakoff, MacKenzie and Fetter analyses for non-pro-
fessionals and professionals found consistent substitutes for the
leadership they studied, they argued that their method might
have been too conservative, and alternative methods were pro-
posed. For instance, before they had examined the moderation of
each leadership style, they had partialled out all the others.
For our purposes here, it still seems an open question as to
whether there are substitutes for the components of transforma-
tional leadership. For instance, to what extent will the availability
of computerized decision support systems replace, neutralize or
enhance intellectual stimulation? As we have noted in earlier
sections, the components of transformational leadership are
much more strongly predictive of outcomes in effectiveness, extra
effort commitment and satisfaction than contingent rewards. Con-
tingent reward is more highly predictive of such outcomes than
passive managing-by-exception and laissez-faire leadership is ,
v7~ negatively correlated with outcomes. It would be an important ~&-
contribution to efficiency if accurate substitutes for transforma-
tional leadership could be reliably demonstrated. Howell, Bowen,
Dorfman, Kerr and Podsakoff (1993) argued that we may still find
many effective alternatives to the necessity of leadership to
achieve effective outcomes.
SUGGESTED SUBSTITUTES FOR TRANSFORMATIONAL

AND TRANSACTIONAL LEADERSHIP
In crisis conditions, overtraining and competence of follow-

ers can substitute for the direction to be provided by the leader's
direction. This was seen in observations of the relations between
the pilots who land on aircraft carriers under the direction of air-
craft controllers. In the same way in a camping equipment firm,
consultation disclosed the intrinsic satisfaction that employees
derived from their work in producing a high-quality product
substituted for the need for strong leadership. When they had to
work on low-quality products, closer supervision was required
(Howell, Bowen, Dorfman, et al., 1993).
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Bass Book 12-13 2/27/96 3:54 AM Page 179
&
The authors note that feedback, coaching and guidance

(which we see as important elements in individualized consider-
ation) can be provided by computer instead of by a supervisor. The
computer may make flattening organizations and increased span
of control increasingly possible, suggesting that the computer will
help to foster empowerment. For professional employees such
as accountants, engineers, or nurses, professional education and
its associated socialization processes may substitute for trans-
formational leadership to provide their readiness for autonomy
and empowerment.
Extensive subordinate education was found to substitute for
direction and supportive leadership in a book publishing house, a
branch bank and a midwestern university. Again, high ability,
experienced workers appear to require little direct supervision at
Cummins Engine, General Motors or Proctor and Gamble (Howell,
Bowen, Dorfman, et al., 1993).
Teams as Substitutes for Transformational or Transactional

Leadership
-£ )- Although there is as yet no evaluation of the subject, as noted _r x.
in Section 8, transformational teams can be conceived, assessed,
and trained. It would seem that transformational teams could
function in ways to generate the extra effort, performance and sat-
isfaction expected from transformational leadership. In another
sense, transformational leadership could be shared among the
team members.
We might see a small military team whose esprit had been
built by a previous history of success, gallantry and mutual sup-
port of members for each other. Its formally appointed officer
might find the membership on the team provided sufficient mem-
ber self-esteem without any effort on his/her part. The attrac-
tiveness of the team to each member resulting in the team's
cohesiveness would only require of the formal appointed leader
that the team's and the organization's goals be in alignment.
Instead of motivation being supplied by identification of
members with an idealized, charismatic leader, similar motiva-
tion would be supplied by identification with the team or the
ideal team member. There would be the desire to emulate the
other team members rather than the formally appointed team
leader. Respect and admiration of all other members would sub-
stitute for the direction of such feelings toward the leader. Inspi-
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Bass Book 12-13 2/29/96 1:54 PM Page 180
■e-
ration would come from a sharing of mutually-articulated goals,

simplified wordage in each other's language and clarification of
the mission by-and-for each other. Norms for the team would sup-
port efforts for members to intellectually stimulate each other.
Member competence and/or experience might replace or enhance
leadership in achievement of goals and creative completion
of tasks.
The individual consideration provided by the formally
appointed leader could be provided by the members for each
other, particularly if team members were trained to discern the
individual differences among them and the importance of mutual
coaching depending on the differences in their initial experience
and knowledge.
Empowered, self-managed work teams ideally epitomize
substitution for much of what was done before by the formal
hierarchical leader. Each team is assigned closely related pro-
duction tasks. The teams are set off from each other by physical
space and stores of work in progress. Each team is responsible
for assigning tasks to its members, inspecting its own work, and
-Q- tracking its quality, production and hours worked. Absenteeism r^_
^ and discipline are handled by the team. The members are trained
in maintaining effective meetings and group problem solving.
A supervisor is responsible for each team, but only supplies
guidance and support in the early stages of the team's develop-
ment. Self-observation, self-evaluation, and self-reinforcement
are encouraged by the supervisor. Superiors of effective teams act
like consultants. They spend time obtaining resources for the
team, representing the team to higher authority, training new
members, and coaching the team members in providing feedback
to each other.
Mainly transformational in their behavior, tranformational
team and team members may provide rewards in the form of
praise, or objective measures of goal attainment contingent on
performance. The team or its members may practice managing-by-
exception in maintaining discipline.
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Work Rules, Policies and Procedures

Work rules, policies, and procedures may be replacements
for or enhancers of transactional leadership, particularly man-
aging-by-exception. Failure to comply with safety rules may
be automatically called to an employee's attention by a signal.
Howell, Bowen, et al. (1993) suggest that this type of leadership
substitute can be particularly important when consistent behavior
is imperative.
The military may introduce special procedures, symbols,
codes, uniforms, badges and difficult entrance requirements to
promote identification with a unit with a special mission. All of
these may substitute to some degree for the transformational iden-
tification with the charismatic-inspired leadership. They are
likely to serve as enhancers of the leader's efforts to inspire the
unit about its mission.
The organization can also enhance an already effective
leader's transformational or transactional performance by provid-
ing additional resources, more discretion in allocating resources
and more access to important information and key people at
/i-N higher levels. ^
Other Possible Substitutes

Other potential enhancers or replacements of a transforma-
tional leader's effectiveness include:
• Peer appraisals to increase acceptability of feedback.
• Controls over quality by employees.
• Peer support networks.
• Automatic gainsharing reward systems.
• Mission statements and codes of conduct.
• Redesigned jobs to have ideological importance and
performance feedback from the task.
• A visible organizational champion of the leader.
• Assignment of the leader to important organizational
responsibilities.
• In-house publicity of the leader's image.
• "Small" success experiences to increase the subordinates'
confidence in the leader.
• Ceremony and myth to promote a transformational
organizational culture.
• Superordinate goals from higher authority to encourage
high performance norms.
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Other substitutes or enhancements of the effects of transfor-

mational leadership might include: crisis reduction through in-
place effective and rapid communication systems, ideologically
committed followers, organizational cultures with transforma-
tional characteristics which give members a sense of empower-
ment, acceptance of innovation, the importance of learning and
the value of doing the right thing instead of just doing things
right. Conversely, organizations that avoided bureaucratic entan-
glements and that fostered cooperation rather than competition
among its members (members competed against their own previ-
ous records rather than the records of others) would provide sub-
stitutes for transformational leadership.
Additionally, Sergiovanni (1990a) suggests that leadership
can be replaced or enhanced by the professionalization of follow-
ers. The ideals of the profession can provide the moral authority
for action without the intervention of leadership. For instance, in
teaching, professional ideals include a commitment to caring
toward the profession itself and practice toward valued social
ends in an exemplary way. Organizational norms can also substi-
tute for leadership. Followers are committed to pursue certain
■e- paths because of their desire to conform to the organizational
norms rather than because of leadership. One may speculate that
-e-
more substitution for leadership can take place if the Army is pro-
fessionalized with ideals of exemplary performance, patriotism,
duty and service to the country and to the profession itself.
Neutralize™ of Transformational and Transactional Leadership

Leadership neutralize™ are characteristics of subordinates,
tasks, and organizations that interfere with a leader's perfor-
mance. Neutralizers offset the leader's impact and reduce the
leader's influence and effectiveness. The same rules that are sup-
posed to substitute for transactional leadership could work to
neutralize transformational leadership. The leader who tries to be
intellectually stimulating might generate the soldier's reaction of
"Yes, but we are not supposed to do things that way." The leader
who would be trying to inspire a sense of mission might be
greeted with "Yes, but that's not what we get paid to do." The
leader who might be trying to rejuvenate a subordinate who had
reached a plateau in effort might hear the response "Yes, but next
year, I will be forced to retire."
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The physical distance between leader and subordinate may be

a neutralizes When subordinates must work at a physical distance
from the leader as in the case of Army station heads and the com-
pany commanders above them, the leadership may be neutralized.
Physical distances may be too great for much personal interaction
and serve to neutralize much of the commander's transformational
influence as well as his ability to manage-by-exception.
Regional managers at Kinko's, which provides professional
copying services at widely dispersed locations nationwide, are
frustrated by their inability to provide guidance and personal sup-
port for new store managers because physical distance prevents
personal interaction. In international organizations, leaders and
followers may live and work in very different time zones and be
unable to share the same work day. Again, physical distance has
become a potential neutralizer as more employees work at home or
at client sites (Howell, Bowman, Dorfman, et al., 1993). Physical
distance may be eliminated as a neutralizer of leadership by the
increasing availability of telecommunication and teleconferencing.
Systems that provide rewards primarily for seniority such as
in civil services where promotion is based on examination may .
T7" neutralize the possibilities for a leader to engage in contingent ~~w
reward. (On the other hand, the superior may be more transforma-
tional in encouraging employees to prepare for the examination.)
Again, leaders may be unable to practice management-by-excep-
tion because union contracts mandate employees with a given job
classification must be paid the same wages. Neutralization may
occur because rewards may be controlled by higher management
in ways that prevent the immediate supervisor from exerting
influence such as when organizations require numerous higher
level approvals before a salary recommendation can take effect.
Timing can be a neutralizer. Rewarding may be constrained by
fiscal periods or employee anniversary dates (Howell, Bowman,
Dorfman, et al., 1993).
The leader's influence may be neutralized if he or she is
by-passed by subordinates going above him or her in the hier-
archy for a decision, or conversely, superiors going directly to
the leader's subordinates with decisions. Yet, the aggregate effect
might be salutary on the subordinates' performance if the leader
was laissez-faire or incompetent.
Substitutes for leadership should be sought or created where
the leadership is too costly, where it is incompetent and cannot be
trained, or the leaders themselves cannot be replaced.
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O
SECTION 13
Conclusions
Introduction
This report highlighted answers to eleven questions of con-
sequence to military leadership which were presented in the
introductory section of the report. It also attempted to find
through experiment and field study confirmation of answers to
unresolved questions.
Review. Following the introduction, Section 1, about a model
of transformational/transactional leadership, Section 2 examined
some of the ways transformational leadership enhances com-
mitment, involvement, loyalty and performance of followers.
■e-
Section 3 looked at how transactional leadership may induce
more stress and transformational leadership help cope with stress -e-
among followers. How contingencies such as combat and crises
affect transformational leadership was the subject of Section 4.
Section 5 dealt with the effects of organizational culture, Section 6
dealt with the effects of gender, and Section 7 dealt with the
effects of organizational policies. Section 8 asked how and what
could be taught about the subject, and Section 9 reviewed the pos-
sibilities of forecasting transformational/transactional leadership.
Section 10 asked whether rank and status were of consequence to
exhibiting transformational leadership or was it as present as
much among squad leaders as among commanders? Section 11
focused on the distinction between laissez-faire leadership and
empowerment, and Section 12 asked about substitutes for trans-
formational leadership. Both published and unpublished litera-
ture were combed to provide support or refutation of the points of
view expressed.
Extensions. In Sections 5 and 8, it was noted that the transac-
tional/transformational rubric can be applied to teams as a whole
and organizations as a whole. In the same way, the paradigm can
be extended to describing international negotiations. Kissinger
(1994) has been able to describe and explain international agree-
185
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ments in terms of the extent the national leadership and the

national publics lay emphasis on principles (transformational)
or power politics (transactional). When a pope talks about prin-
ciples of morality, Joseph Stalin asks how many army divisions he
has. Does the United States send American troops into harm's
way in Kuwait only if U.S. economic and political interests are
threatened (transactional) and/or to uphold principles of moral-
ity, humanitarianism, and world peace, etc. (transformational)?
The Changing Followership

Transformational leadership was seen to becoming increas-
ingly salient because of the personnel for whom future leaders
will be responsible. The changes in the work force will promote
changes in the mix of transformational and transactional leader-
ship needed with implications for changes in selection, training,
development and organizational policies. Increasingly, leaders
are being encouraged to empower their followers by developing
them into high involvement teams focused on quality and cost-
effectiveness as well as quantity of output of production and ser-
vice. The end of the Cold War has placed a premium on military
-e- readiness. Jobs for the less well educated are automated out of
existence. Those that remain call for better education and train-
-e
ing. More responsibility is moved downward in the flattening
organizational hierarchy increasingly composed of educated pro-
fessionals who see themselves as colleagues. Elements of transfor-
mational leadership such as autonomy and challenging work
become more important to job satisfaction according to numerous
employee attitude surveys. Similarly, how hard one works is seen
to be fairly independent of the pay and benefits one receives, sug-
gesting that transactional leadership will be less potent.
In 1960, parents felt that the most important values to teach
their children were to respect authority, to respect the church,
to respect one's government and to avoid questioning authority.
Today the children of the 1960's are trying to teach their children
to accept responsibility for their own actions, to be willing and
confident in accepting challenges, and to question authority when
necessary. Whyte's conforming organizational man, totally dedi-
cated to the firm, did not question authority. In the 1990's much
skepticism and cynicism have replaced the norms of unquestion-
ing conformity of the 1950's.
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Conclusions 187
In the 1950's, transcending one's self-interests for the good

of the organization was a norm of conformity. That is, there was
public and expressed acceptance of organizational goals, but
filled with much private reservation. "What's good for General
Motors is good for the country" was expressed publicly but not
necessarily privately. Today, such going beyond one's self-inter-
ests for the good of the organization requires aligning the indi-
vidual member's interests and values with those of the organiza-
tions transformational leadership. Thus, Podsakoff, et al. (1990)
found that trust in the leadership was required before one would
find the emergence of transcendental organizational citizenship
behavior (altruism, conscientiousness, sportsmanship, courtesy
and civic virtues).
Going Beyond Self-Actualization

The importance of going beyond one's self-interests is some-
thing lost sight of by those who press hard on the developmental
function of the transformational leader. It needs to be remembered
that Handy (1994) was 16 years behind Burns (1978) in his sug-
gestion that Maslow's (1954) hierarchy of needs should be ,
TT" extended upwards to go beyond one's self-oriented concerns. ~0~
Maslow ...postulated that there was a hierarchy of
needs, that when you had enough material goods you
moved your sights to social prestige and then to self-
realization. ...His hierarchy did not reach far enough.
There could be a stage beyond self-realization, a stage
we might call idealization, the pursuit of an ideal or a
cause that is more than oneself. It is this extra stage that
would redeem the self-centered tone of Maslow's thesis,
which for all that it rings true of much of our experience,
has a rather bitter aftertaste. (Handy, 1994, p. 275)
Burns, of course, 16 years earlier, had handled this possible
bitter aftertaste by describing the transforming leader as one who
not only moved followers up on Maslow's hierarchy, but also
moved them to transcend their own self-interests.
One paradox for us may be that as we push the transforma-
tional process, particularly focusing on development of followers,
we may shortchange the transcending of followers' self-interests.
The transformational leader needs to do both by aligning the fol-
lowers' self-interests in development with the interests of the
group, organization or society. Currently, Williams (1994) is work-
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e-
ing on showing that transformational leaders as measured by the

MLQ will display more citizenship behaviors such as altruism,
conscientiousness, sportsmanship, courtesy and civic virtue as
well as imbue such ideas in their subordinates. This is one reason
why Avolio and I (1991) chose to substitute for charisma, in train-
ing and elsewhere, the term idealized influence, that is, being
influential about ideals. At the highest level of morality are self-
less ideal causes to which leaders and followers may dedicate
themselves. Serving one's country to the best of one's abilities can
be a powerful motivator in the military. It is not a new idea as it is
found in Homer's Iliad that "he serves me most who serves his
country best."
Needed is a research which deals with the potential conflict
of the would-be transformational leader's striving for achieve-
ment and self-actualization and his or her pursuit of the greater
good for group, organization or society. The resolution may lie in
the alignment of his or her own personal principles with those of
the troop, organization and society. But other seemingly unresolv-
able conflicts may exist for military officers and cadets who are
faced with threats to the achievement of their goals if, as expected ,
-
vT in the honor code, they notify authorities of unethical behavior -&-
they observe in fellow officers. For in doing so they violate the
quality of relationships they are expected to maintain with fellow
officers or cadets in order to conform to the principle enunciated
in the honor code.
MEASUREMENT OF TRANSFORMATIONAL
LEADERSHIP AND TRANSACTTONAL LEADERSHIP
Much of this report is based on studies using the Multifactor

Leadership Questionnaire for which problems remain of multi-
collinearity, lower than desired reliability's under some circum-
stances for active managing-be-exception and questions about the
universality of the factor structure of the model of the full range of
leadership. Kelvin's admonition that "if we can't measure it, we
don't know what we are talking about" drives our search for con-
firmation of understanding, theory and principles. Nevertheless,
it was probably the Vietnam "body count" approach to evaluating
the success of battles that gave rise to McNamara's Fallacy:
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Conclusions 189
The first step is to measure whatever can be easily

measured. This is OK as far as it goes. The second step is
to disregard that which can't be easily measured or to
give it an arbitrary quantitative value. This is artificial
and misleading. The third step is to presume that what
can't be measured easily really isn't important. This is
blindness. The fourth step is to say that what can't be
easily measured really doesn't exist. This is suicide.
(Handy, 1944, p. 221)
As we deal with leadership that is as much emotional as
rational in effect, we need to appreciate what the non-quantitative
scholars in psychohistory, sociology and political science have
to say about charisma and transformational leadership. Instruc-
tive are works such as Caro's (1974, 1982) biographies of Lyndon
Johnson and Robert Moses, and Kets de Vries' (1994) psychoana-
lytic views of defects in charismatic leadership.
Levels of Leadership
MLQ and similar types of data can be gathered using the
(t) same instruments, constructs, and model across all levels of lead- fh
VJ
^ ership (Yammarino & Bass, 1991): micro-leadership (leadership of ^
the small group), macro-leadership (leadership of the large organ-
ization) and meta-leadership (leadership of movements and
societies) (Nicholls, 1987,1990). Thus, we see applications at the
micro-level (Hater & Bass, 1988), at the macro-level (Yokochi,
1989), and at the meta-level (Bass, Avolio, & Goodheim, 1987) of
the same model of transformational leadership. It also generalizes
across nationalities and language (e.g., Francois, 1990).
On Charisma
By relaxing the criteria set forth by Weber (1929/1947) for
what is to be considered charismatic (Bass, 1985), by operational-
izing and measuring it, then including it as one of the four dimen-
sions of transformational leadership, we have seen that a great
deal can be learned about transformational leadership as well as
charisma. Perhaps most significant is that we have been able to
develop a much better understanding of the behaviors exhibited
by such leaders, key personality characteristics underlying those
behaviors, their impact, and how individuals develop into being
charismatic and transformational.
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Charisma and Inspiration. In constructing the MLQ, the

criterion of the principle of parsimony was violated when, for the
purposes of fuller profile description, some of the items which are
highly loaded and highly correlated (above .80) with the charis-
matic factor were formed to create a scale of inspirational motiva-
tion (see Bass, 1985, p. 214). Highly intercorrelated items such as
"is an inspiration to us" and "inspires loyalty in the organization"
formed the scale. This was done because it was believed that a
leader could move followers toward common goals, provide
meaning, and generate acceptance of missions without necessar-
ily being charismatic. One did not have to identify with leaders to
be aroused by them about the importance of an effort.
Repeated factor analyses have never supported the extraction
of inspiration from charismatic factor but there were separate
bodies of literature for charismatic leadership and for inspira-
tional leadership to which the work could be connected. The
same leaders who are charismatic are also inspirational but the
involved behaviors, attributions and effects differ. Chapter 12 in
the Bass & Stogdill Handbook of Leadership (Bass, 1990) divides
^ itself into charismatic, charisma-like, and inspirational leader- ,
~w ship. Not only are the behaviors, attributions and effects different ~&-
but the relevant research literature is different.
Idealized Influence. There were several disadvantages in
continuing the use of the term charismatic. First, it had come to
represent a wide spectrum of meanings in the media and the pub-
lic mind ranging from celebrated to flamboyant, exciting and per-
sonable. Second, in many of the countries in Europe and Asia, in
which we subsequently used the factor structure for research and
training, charisma was too much associated with Mussolini,
Hitler, Tojo and dictatorship. And so for training purposes, the
term, idealized influence, was substituted for the charismatic fac-
tor (Bass & Avolio, 1990), although in this research report we con-
tinue to use the term charismatic leadership and charisma.
It may be that for purposes of quantitative study we should
revert to a single factor encompassing charisma and inspira-
tional leadership as Howell and Avolio (1993) did. However,
McNamara's Fallacy mentioned earlier suggests that something
may exist, such as the distinction between charisma and inspira-
tion, without it being easy to measure.
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Bass Book 12-13 2/27/96 4:03 AM Page 191
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Conclusions 191
Measuring Transactional Leadership

Transformational leadership adds to the contribution of
transactional leadership to effectiveness; transformational leader-
ship does not substitute for transactional leadership. Numerous
empirical studies of this augmentation effect (e.g., Waldman,
Bass, & Yammarino, 1990) support the original theoretical
assumption (Bass, 1985). The best leaders are both transforma-
tional and transactional. Franklin Delano Roosevelt was a con-
summate politician as well as one of America's most charismatic
presidents (House, Spangler, & Woycke, 1991).
In the first and many subsequent factor analyses, two transac-
tional factors emerged. These were the two faces of contingent
reinforcement, contingent reward "Tells me what to do if I want to
be rewarded for my efforts," and contingent aversive reinforce-
ment (relabeled management-by-exception) "If it ain't broken,
don't fix it." In continued military work, Yammarino and Bass
(1990) also split contingent reward into promises (e.g., "clarifies
what I will get if I succeed") and rewards (e.g., "gives me what I
want in exchange for showing my support for him/her.")
"^ > In Section 11, we noted that the items which were all thought "£ )~
to measure laissez-faire leadership, the avoidance of leadership,
such as "is absent when needed," and "takes no action even when
problems become chronic" included some items which assessed
the more positive empowerment, "let's me decide on matters
about which I know best."
Hater and Bass (1988), Hoover (1987) and Yammarino and
Bass (1990) all found it factorially valid to further split manage-
ment-by-exception into an active factor such as "arranges to know
when things go wrong" and a passive factor "subscribes to the
belief that if it 'ain't broken, don't fix it'." These divisions are
further justified by unpublished factor analyses mentioned in
Sections 9 and 12.
Multicollinearity. Some factor studies such as an unpub-
lished study of Air Force officers at Maxwell Field emerged with
only a single factor of charisma or transformational leadership.
This probably happened because short scales were used. Never-
theless, three factors, charisma, intellectual stimulation, and indi-
vidualized consideration emerge in repeated studies either when
using principal components factor analysis or when employing
partial least squares (PLS) analysis (Howell & Avolio, 1993).
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The usefulness of the three factors instead of one transforma-

tional leadership factor conceptually offsets the fuzzy quantita-
tive aspects when applied in training. Trainees can learn a lot
about how to be more inspirational; they have a harder time
authentically reinventing themselves as charismatic leaders.
They can work on becoming more individually considerate even
though they already are intellectually stimulating.
It has been argued that the MLQ was measuring attributes
and effects, not behaviors. Nonetheless, most of the 70 items of
the MLQ concern behaviors. Only a few are attributions or effects.
But particularly when assessing charisma, it is essential that
some follower attributions be obtained for charisma involves
the extraordinariness seen "in the eyes of the beholder" (Bass &
Avolio, 1993).
The multicollinearity in the factors of transformational
presents a statistical problem even as we cross cultures, but the
structure remains. Mean scores on the factors may vary and some
behaviors may become inappropriate. For instance, in Japan, con-
tingent reward is more implicit than explicit. Nevertheless, the
-CX- overall factor structure continues to provide a meaningful frame- _ZA_
^ work (Bass, in press). While charisma is the largest component of
variance in transformational leadership, the other components of
intellectual stimulation and individualized consideration are
important theoretically and practically. They involve different
behaviors, attributions and effects. The abusive, abrasive, char-
ismatic leader does not exhibit the same amount of individ-
ualized consideration as does the warm, socially-concerned
charismatic. The knowledge, skills, and abilities which may help
one become more intellectually stimulating may be unconnected
to one's individualized consideration.
RELATED CONCEPTS AND MEASURES
LBDQ Consideration. Individualized consideration is con-

ceptually distinct from the Leader Behavior Description Ques-
tionnaire (LBDQ) scale of consideration although empirically
correlated with it. Seltzer and Bass (1990) reported a correlation
of .69. LBDQ consideration focuses on friendliness, approacha-
bility and participative decision-making; individualized consid-
eration deals with concern for each follower as an individual and
with the follower's development. It includes:
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Conclusions 193
...knowing your followers' needs and raising them

to more mature levels...(and) the use of delegation to
provide opportunities for each follower to self-actualize
and to attain higher standards of moral development.
Some leaders can be quite directive rather than partici-
pative in such actions. (Bass & Avolio, 1993, p. 64)
According to data collected by Seltzer and Bass, LBDQ initi-
ation and consideration may substitute for transactional, but not
for transformational leadership. Much additional variance in
effectiveness was accounted for by adding the MLQ transforma-
tional leadership scores to the LBDQ initiation and consideration
scores in multiple regression equations. Furthermore, there are
"highly reliable differences among the conceptions of managers,
project supervisors, CEOs, military officers, principals, and other
administrators in the distinctions between transactional leader-
ship, transformational leadership, LBDQ consideration and initia-
tion of structure" (Bass & Avolio, 1993, p. 65).
Directive and Participative Leadership. Transformational
leaders can be directive or participative, authoritarian or demo-
(T\ cratic. Nelson Mandela is directive and transformational when he fh
^ declares "forget the past." He can be participative and transforma- ^
tional when he actively supports and involves himself in open,
multiracial consultations. He can be directive and transactional
when he promises blacks better housing in exchange for their
votes and is participative and transactional when he reaches
mutual agreements about sharing power with the white minority.
The same leaders display both transformational and transactional
behavior and mix direction and participation.
Leader-Member Exchange (LMX). Tejeda and Scandura
(1994) are currently looking at the relationship among supervisors
and subordinates in a health care organization between transfor-
mational leadership and Leader-Member Exchange (LMX) (Graen
& Scandura, 1987). There have been attempts by Yukl (1989) to
deal with LMX as transactional leadership because of LMX's
reliance on exchange of rewards. However, subsequent examina-
tion of the development process in LMX by Graen and Uhl-Bien
(1991) have been able to reframe LMX as a transformational lead-
ership process as LMX unfolds in several stages in which trust,
loyalty and respect develop. In the first stage, LMX is transac-
tional. If the last stage is reached, it is transformational.
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Bass Book 12-13 2/26/96 10:39 AM Page 194
&
OTHER PROSPECTIVE RESEARCH AND

DEVELOPMENT ISSUES
Other areas which need further exploration and exploitation,
particularly in the military, are the linkage to transformational
and transactional leadership of moral and personal development,
improvement of training, and situational aspects that may make a
difference in the emergence and effectiveness of transformational
leadership.
Moral and Personal Development

Mature moral development is required of the transforma-
tional leader (Kuhnert & Lewis, 1987). The immature, self-aggran-
dizing charismatic is pseudo-transformational. He or she may
seem uplifting and responsible but on closer examination is
found to be a false Messiah.
One's parents' moral standards and one's leadership experi-
ences in school and extracurricular activities forecast subsequent
tendencies to be more transformational as adult leaders (Avolio,
^ 1994). Avolio and Gibbons (1988) reported that industrial execu- ,
vT- tives who were rated by their immediate subordinates as highly TJ
transformational, reported in retrospective interviews that their
parents provided them with difficult challenges but also sup-
ported the nascent leaders' efforts whether or not they resulted in
success (Gibbons, 1986). Similarly, transformational community
leaders described childhood and adolescent experiences with car-
ing but challenging parents who held high standards. Schools
also made a difference (Avolio & Bass, 1994).
Much more needs to be learned about the ethical and moral
factors that distinguish the truly transformational leader from the
pseudotransformational leader.
Training
Intuitively, teaching and learning about how to be more or
less constructive and corrective as a transactional leader should
be easy to do. Not as easy is learning about how to be more trans-
formational (Avolio & Bass, 1994). Nevertheless, it is doable. Self-
reports, incidents, and collegial ratings from the work place have
been collected from 200 executives and 500 community leaders to
assess the impact of continuing, extensive, and comprehensive
training programs, the "Full Range of Leadership Development."
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Bass Book 12-13 2/27/96 4:07 AM Page 195
<>
Conclusions 195
Generally, positive results have been obtained. Follow-ups six

months to a year later suggest modest improvements in transfor-
mational leadership, particularly in those components on which
participants made plans to improve. These improvements tend
to be accompanied by a reduction in the use of managing-by-
exception (Avolio & Bass, 1994). Much of what has already been
learned about the training of civilians in transformational leader-
ship has not been fully exploited by the military.
Contingencies
A case can be made for the universality of the concepts of
transformational and transactional leadership. Although the orig-
inal theory, model and measurement emerged in the individual-
istic United States, it appears equally applicable in the collec-
tivist societies of Asia. Collectivistic cultures provide the leaders
with ready-made opportunities to become transformational lead-
ers. Most subordinates in collectivistic cultures already have
respect for their leaders. Transformational leadership is more
likely to be enhanced further by centrality of work in life and the
high level of group orientation among followers.
The mutual obligation between the leaders and the followers ^
facilitates the transformational leader's individualized considera-
tion. Leaders in collectivistic cultures already have a moral
responsibility to take care of their subordinates, to help them
prepare a career development plan, to attend their funeral cere-
monies and birthday parties, and to counsel followers about
personal problems. In turn, subordinates have a moral obligation
to reciprocate with unquestioning loyalty and obedience. Indeed,
transformational leadership may be far more pervasive in col-
lectivistic societies compared to the individualistic societies of
the West.
In turn, this may help to explain the fast economic develop-
ment of the East Asian "Five Dragons." But within the East-West
context, other contingent relationships need further examination.
These include the organization's culture and the transformational
leaders contribution to it, gender differences, and the importance
of transformational leadership when leaders face diversity of eth-
nicity, race and sex among their followers. We need to learn in
what ways individualistic cultures can gain the benefits of the
collectivistic cultures for transformational leadership without the
associated costs in creativity and initiative.
"(>
Bass Book 12-13 2/29/96 2:02 PM Page 196
-Q-
Organizational Culture. For an organizational culture to

become more transformational and to accomplish the needed
changes in an organization's culture, top management must articu-
late the changes that are required. The message may be of a vision
which needs to be shared about the style of leadership the organi-
zation wants to emphasize. If it wants to tap the expertise of its
members to the fullest, it may highlight its "consultative" style of
leadership. Changes, consistent with this message, are introduced
in the daily practices of the organization. Desired role models of
leadership begin at the top and are encouraged at each successive
level below. The behaviors of top level leaders become symbols of
the organization's new culture. Stories are created around the
leader, and mechanisms are developed to improve upward com-
munication.
Leaders who are concerned about organizational renewal
will seek to foster organizational cultures that are hospitable and
conducive to creativity, problem solving, risk taking, and experi-
mentation. First, there is an articulation of the changes that are
desired. Next, the necessary changes in structure, processes, and
practices are made and are widely communicated throughout the ,
V7~ organization. Stites-Doe, Pillai & Meindl (1994) have proposed ~~&-
and are testing in two financial institutions hypotheses about
transformational leadership and the way the organizational cul-
ture will be adopted by employees. They propose that individu-
ally considerate leaders will participate in more acculturation
activities than those who are not. Many other aspects of how the
organizational culture can affect and be affected by its leadership
need to be examined.
Sex Differences. Paradoxically, one might propose that anti-
feminine bias and disadvantage is a plausible explanation for the
current results, reported in Section 6, finding women are some-
what more transformational and therefore likely to make more
effective leaders. It is often argued that women have to be that
much better leaders than their male counterparts to attain the
same positions of responsibility and levels of success as men. But
just the opposite can be argued by suggesting that affirmative
action has pushed women faster and higher than justified by their
competencies. Nevertheless, the military may be moving in the
right direction in promoting relatively large numbers of women
into positions of leadership.
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Conclusions 197
Several new studies are needed to test if the above argument

is correct. Our results are contingent on the fact that the majority
of the organizations studied were male. We need to examine what
happens when women are in a majority, such as in nursing. Got-
tlieb (1990) completed such a study on nursing administrators in
V.A. hospitals and emerged with challenging contrary findings.
Do men have to be better than women to achieve the same
levels of success? We need studies which match or adjust for abil-
ities predictive of success as a leader. If we can equalize such
capabilities, will women still emerge as more transformational
than men as leaders?
Diversity. In an unpublished paper, Del Castillo defined cul-
tural competency as a set of skills for maintaining a process of
ethical balance between individual rights and responsibilities.
Cultural competency involves (1) understanding
the methods by which individuals/groups perceive the
world and develop conceptual schemes, (2) understand-
ing one's own conceptual scheme, (3) integrating other
views into one's respective conceptual schemes, and (4) .
\.y~ valuing the diversity of all conceptual schemes. v7~
He then went on to show that it would be transformational
leaders who would be better prepared to value and adapt to diver-
sity among their followers. The charismatic was expected to
envisage a culturally competent organization, to inspire confi-
dence in its achievement, to use intellectual stimulation to
encourage new ways of dealing with the increasing diversity of
their followers and to be empathetic with their followers different
needs as individually considerate leaders.
More Theory and Explanation Needed

Applied research in transformational leadership has been
abundant. Basic research and theory have been in short supply.
We have made an effort to track all published and unpublished
studies and to maintain the collection of reports, theses, disserta-
tions, and journal articles in the library at our Center for Leader-
ship Studies. All users of the experimental MLQ 5X are asked to
send us copies of their results and writings.
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Bass Book 12-13 2/29/96 2:03 PM Page 19E
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On the one hand, of the 180 reports on file to date, a large

majority reconfirm the "correlational hierarchy." The transforma-
tional factors are usually found more highly correlated with out-
comes in effectiveness and satisfaction of colleagues than is
contingent reward. Contingent reward is ordinarily more highly
correlated with outcomes than is managing-by-exception, particu-
larly passive managing-by-exception. Finally, laissez-faire leader-
ship is almost uniformly negatively correlated with outcomes.
There has been some demonstration of the contributions of trans-
formational leadership to other criteria such as innovativeness and
quality improvement. Nonetheless, there has been relatively little
basic research testing of the many models of linkages proposed by
Bass (1985) to explain how transformational leadership works.
The closest to the promotion of fundamental understanding
with empirical verification has come from work by Podsakoff,
MacKenzie, Moorman and Fetter (1990) who have shown that
trust is an important intervening construct. Theorization by
Shamir, House, and Arthur (1993) has connected the charismatic
behavior of the leader (which includes inspirational motivation,
intellectual stimulation and individualized consideration) with ,
vT- the self-concept and self-esteem needs of the follower, and ~0~
Howell and Frost (1988), who in testing House's 1976 Theory of
Leadership (House, 1977), found that while initiation but not con-
sideration could maintain high worker productivity when work
group norms supported such productivity, only charismatic lead-
ership could maintain high productivity in the face of conflicting
low productivity norms. Recent contributions by House and
Shamir (1993) and Shamir, House, and Arthur (1993) have begun
to "get to the bottom of things." These authors propose that trans-
actional leaders focus on pragmatic paths to goals while transfor-
mational leaders produce in their followers a higher: (1) salience
of the collective identity in their self-concept; (2) sense of consis-
tency between their self-concept and their actions on behalf of the
leader and the collective; (3) level of self-esteem and a greater
sense of self-worth; (4) similarity between their self-concept and
their perception of the leader; (5) sense of collective efficacy; and
(6) sense of "meaningfulness" in their work and lives.
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Conclusions 199
By engaging follower self-concepts and arousing noncon-

scious motives of followers, the transformational leaders selec-
tively arouse follower nonconscious achievement, affiliation,
power motives and other motives. These are nonconscious
stable motives, that have strong and enduring behavioral conse-
quences. Such motive arousal results in increased engagement of
the self, self-monitoring, and self-evaluation. Such arousal
engages the self-worth component of motivation and increases
motivation on the part of followers.
Ultimately this leads to increased commitment to the mis-
sion since motive arousal results in increased self-engagement.
Since the experience of self-worth and self-efficacy are contingent
on goal attainment, it would be highly dissonant for the individ-
ual to resist commitment to the vision and mission of the leader.
Although the new paradigm of transformational/transac-
tional leadership came to the attention of scholars 16 years ago
(Burns, 1978) and the first book which provided a model and
empirical studies only appeared nine years ago (Bass, 1985),
much has already been accomplished, but more is yet to be done.
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SECTION 14
References
Alimo-Metcalfe, B. (1994). An investigation of female and

male constructs of leadership and empowerment. Paper, Interna-
tional Congress of Applied Psychology, Madrid, Spain.
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