- OIL & GAS
The purpose of this article is to make clear just what characterizes both transactional and transformational leadership, and to describe skills necessary to become more transformational. The case will also be made that transformational leadership not only will drive health & safety (H&S) excellence, but also excellence in other critical business functions such as cost, quality, productivity, customer service, etc.
For functional excellence to occur, the individuals involved in whatever the process need to be engaged. Said another way, if both the management and the workers are not engaged in the safety process, excellence will not be an outcome. Transformational leadership is the key to ENGAGEMENT.
Peter Drucker, a leading management guru, was one of the early proponents of this principle. His concepts turned companies away from treating employees as cogs (in a wheel), persuading management to think of workers as assets and partners — which is how the best companies behave today.
What Drucker was talking about and the concept of engagement can best be illustrated by the two simple stick diagrams in Figure 1. The stick diagram on the left describes the traditional or transactional approach to treating workers; the figure on the right describes the world class or transformational approach.
There is very little engagement of the worker on the left, but strong engagement occurs when leadership realizes the importance of engaging not just the mind but also the heart of the worker. When the worker is clearly engaged in the safety process, world class safety becomes a reality.
Importantly, engagement of the workforce cannot be accomplished unless leadership is engaged. This is not a chicken and egg kind of thing. Leaders must first start the engagement process and only then is it reasonable to expect the workforce to become engaged.
Transformational & transactional leadership 101
Simply stated, a transactional leader focuses mostly on the task or the work. The transformational leader has a balanced focus on both the work/task and the person doing the work/task. Let’s explore some characteristics of each of these leaders.
A transactional leader:
• A quid pro quo relationship between the worker and leader, frequently relying on disciplinary action
• Task-oriented, e.g. regulatory compliance
• Preserves existing culture, conditions and practices — preserving the status quo
• Likely to focus more on the WORK than the WORKER
A transformational leader:
• Results in the worker’s values aligning with their leader’s values
• Empowers the worker to ENGAGE in the work process — to go beyond their self interest
• The leader is personally ENGAGED with the worker — the leader cares about the worker
• The contribution of the worker is maximized/optimized
• Focuses on both the WORK and the WORKER
Transactional leadership is not all bad. In fact, it is essential for the success of any enterprise. Most senior managers are hardwired to be more transactional than transformational. They need to understand the benefits that can come from achieving a balance that requires them to become more transformational. H&S pros may have to “coach up” their management on this concept.
I will focus on five of the most critical skills that characterize a transformational leader.
Listening: Keys to listening are:
• Seeking first to understand, then to be understood
• Listening for meaning and feeling, not just facts
• Being open to the speaker in a way that it shows — being empathic
• Not interrupting, hearing the other person out
Communicating: Expressing the vision or expectation in a way that resonates with all levels.
• Speaking in the language of the “customer” i.e. the workers
• Be open to feedback and even criticism from subordinates
• Start meetings with safety to communicate its importance
Caring: This is the most important characteristic of a transformational leader.
• Demonstrating genuine concern for others in a visible way
• Being sensitive to the needs of others
• Being willing to interact with all levels
Being Collegial: Demonstrating a sense of equality among others including subordinates. Other keys are:
• Mixing with all levels in a friendly manner
• Relating to all levels and making them feel at ease
• Showing gratitude, sympathy or empathy at all levels
Engaging: Demonstrating a personal connection with subordinates.
• Helping subordinates to commit and achieve the desired goals
• Linking the workers’ needs with the organization’s needs
• Conveying a sense of worth to subordinate, i.e. they are not just cogs in a wheel
Chris Lowney, in his book, “Heroic Leadership,“ summarizes the outcome of transformational leadership: “Individuals perform best when they are respected, valued, and trusted by someone who genuinely cares for their well being.”
Achieving H&S excellence
The role of transformational leadership and engagement in achieving H&S excellence can best be explained by Figure 2 describing a simplistic but typical journey an enterprise takes in achieving excellence.
The vertical axis is injuries and the horizontal axis is time.
Obviously, higher injury rates will occur if the attitude of the enterprise is merely safety awareness, but with no real organized approach to safety and no focused ownership. Compliance is also transactional since it represents a checklist approach.
When management realizes it owns safety, results get better than average. When management actually becomes engaged in the process, results continue to improve. Management engagement is critical to achieving worker engagement. Once both management and the workforce are engaged, excellence is clearly on the horizon.
Achieving functional excellence
Tom Fazio, a senior executive of Atlas Holdings, put this concept best in a talk he gave at their annual meeting, “You need to achieve engagement in safety before you can get their commitment to move the business forward.”
One of the most convincing examples I have seen is shown in Figure 3. These data come from a Cintas plant where a new general manager took over who was very transformational and in three years turned the entire business around. He made it clear that this turnaround started with the health and well-being of his employees (partners as Cintas calls its workers). He provided me with this statement which characterizes his transformational vision: “Our (my) vision was to create a culture of CARING. I personally marketed, communicated, demonstrated and taught this message from the moment I began SERVING the partners of Portsmouth.” I added the emphasis to caring and serving since these are the hallmarks of a transformational leader.
Note the drop in Total Recordable rates from 8.2 to 0.76 in just three years. Also note the significant improvement in other critical business functions such as profit, customer satisfaction, turnover and cost.