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CRITICAL REVIEW ASSIGNMENT - Transformational and Transactional Leadership impact on Management Innovation with regards to Organisational Size

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Stephen Coudounaris z3288792. Thursday 1-2pm MGMT2001 ? CRITICAL REVIEW ASSIGNMENT Introduction The article I have selected is an empirical piece of work conducted by Vaccaro et al. (2012) that considers the relative impact of transformational and transactional leadership styles on management innovation with regards to organisational size. This article determines that organisation size is crucial to determining which style of leadership is effective. The authors expect transactional and transformational leadership to be effective in smaller organisations, whilst achieving little in large organisations. To their surprise, the authors uncover that transformational leadership is in fact useful in large organisations to promote management innovation. Through focus on the two articles by Birkinshaw et al. (2008) and Mol & Birkinshaw (2008), they help expand our view on leadership behaviours and their impact on management innovation. Brief Definitions Transformational leadership involves a leader inspiring others to effect change which is executed through support from members of the group. In comparison, transactional leadership involves the setting of clear goals and objectives to be reached for followers with either rewards or punishment (Vaccaro et al. 2012). Relevance to Theory Vaccaro et al. (2012) cite Birkinshaw et al.?s (2008) definition of management innovation as the ?generation and implementation of a management practice, process, structure or technique that is new to the state of the art and is intended to further organisational goals.? Through this definition here we can see the relevance to this course; ...read more.


However, as it is important to remember with innovation, innovation does not necessarily mean creating an entirely ?new to the state of the art? concept, rather ?new to the organisation? is similarly a form of innovation (Birkinshaw et al. 2008). One example of management innovation explored by Vaccaro et al. (2012) is the ?self-managed teams? implemented at Procter & Gamble during the 1980s where teams became responsible for all their work patters including deadlines. Through initiating change in the structures, processes and practices of the firm, leaders brought about management innovation (Birkinshaw et al. 2008). Findings/Main Conclusions Vaccaro et al. (2012) express surprise in discovering that transformational leadership in fact had a positive influence on management innovation in both small and large, complex organisations. Initially the authors iterated large organisations were simply too large and complex for transformational leadership to inflict management innovation. However, through communicating a shared vision and developing a certain type of organisational culture (such as that developed at Procter & Gamble), leaders have the ability to unite workers who feel uncertainty in both small and large, complex organisations (Vaccaro et al. 2012 cite Birkinshaw et al. 2008). Vaccaro et al. cite Sarros et al. (2002) in proposing a potential reason for such an occurrence; that perhaps individuals in the organisation felt transformational leadership eclipsed the negative impact of bureaucracy and hierarchy, giving them some guidance in a complex system. ...read more.


Lastly, I believe to some extent this article lacks reliability. Vaccaro et al. (2012) acknowledge the fact that only one member of the TMT per organisation was relied on for this article. Thus the presented data could easily have been warped or presented in such a manner whereby the representative had aspirations of change or good press for their organisation. Why I Chose this Article I found this article of particular intrigue due to the fact it focused on the role of management innovation in organisations as opposed to product innovation. The dominant discourse in media is the attention given to product and technical innovation in companies. Where this article is different and interesting to me is the fact that management innovation can also bring about changes to an organisation and what we learn is the relative importance of transactional and transformational leadership in achieving innovation. Furthermore, one learns that through effective and talented leadership, changing an organisation on a managerial level has no bounds. Conclusion This article states the relative importance of transactional and transformational leadership in organisations with regards to size and management innovation. It is clear that these respective forms of leadership are effective in organisations depending on their size and complexity. Management innovation is most likely to occur in both large and small organisations through transformational leadership, whilst transactional leadership is effective in smaller organisations. Through these respective forms of leadership, firms can utilise leadership to create effective change in any organisation. ...read more.

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