Transformational vs Transactional Leadership Theory Case Study

Excerpt from Case Study :

Transactional and Transformational Leadership in Healthcare

Assessing Transformational vs. Transactional Leadership

During IT Implementations

Transactional and Transformational Leadership in Healthcare:

Assessing Transformational vs. Transactional Leadership

During IT Implementations

Healthcare organizations often are the most resistant to new technologies and systems that could paradoxically streamline their professions, making them more effective, productive and creating new career opportunities. Yet from personal experience it is clear that healthcare professionals, including physicians, laboratory technicians and nurses at times resist new information systems (IS) and the potential they have to streamline their jobs. Instead the level of resistance can rise from ignoring the new system and reporting requirements to outright rebellion and leaving a medical practice over having to use it. From personal experience its evident that the best leaders have the ability to define a new information system from a longer-term, more career-aligning perspective. These leaders have been able to define IS platforms, applications and the massive amount of change required from the standpoint of how it will benefit every person affected by the new technologies being implemented. Their approach to creating change management programs that take into account the individualized needs of the health professionals most affected by it to minimize resistance to change and motivate them is highly effective. This is in contract to managers who often resort to highly transaction-centric approaches to bringing change about, using short-term rewards and failing to define a compelling enough vision for healthcare professionals to adapt and excel at their jobs with the new IS platforms and applications.

Information Systems Planning and Implementation in a Healthcare Organization

The most costly aspect of any new information system (IS) in any enterprise are paradoxically the least measurable, as they are directly related to the costs of change management. These costs include interviewing each healthcare professional who will rely on the system for their daily job responsibilities, continually modifying the system during the development process to meet their needs, and also create as many opportunities as possible for them to customize the system and learn about it (Eastman, McCarthy, 2012). Excellent IS implementations share these attributes in addition to having a clear series of objectives they seek to accomplish. They are also oriented more towards the development of a long-term change management strategy that engrains the systems' best features into the overall development of new workflows that streamline and simplify many of the workflows that in the past had been cumbersome, slow and difficult to work with. That is the idealized view of what IS implementation and planning needs to be. Yet in the majority of instances, they are quite different and managed more from a highly transactional leadership mindset, at time descending into an authoritarian-driven approach of demanding adoption and compliance to the new IS platform and applications.

Recently a healthcare provider I am familiar moved their entire healthcare information management system from a legacy mainframe suite of applications and tools. These applications ran on an IBM mainframe and still, in 2013, had bulky IBM green screen monitors on the nursing station desks and a separate room to just run reports and track cases. It was incredibly slow to get information other healthcare provider's offices can get online in seconds through the use of Software-as-a-Service (SaaS) and cloud-based applications. New nursing associates were astounded to see equipment they had seen in textbooks' references of items in the Smithsonian Institution's areas of science and technology. Yet, the healthcare provider did not want to change as the system had so many customized applications that they feared it would be nearly impossible to get the same level of customization from a SaaS- or cloud-based application. In reality, associates who worked there told me the system was correct only 40% of the time and the remaining 60% of the reports were error-filled and at times had calculation errors in them. Clearly it was time to change the system. The IT, management, purchasing and systems support teams all were combined into a project team and SaaS-based health information systems software companies were evaluated. One was chosen and implemented immediately. The change management program was designed to provide just two weeks of feedback from over 50 nurses, 256 physicians and 40 lab technicians. This was incredibly unrealistic, yet the management team felt they had to do this in order to get the purchase done before the end of the fiscal quarter. Carrot-and-stick motivators were used that failed to gain support for the system and it was rushed into place. Now many of the healthcare professionals run a terminal emulation program on their systems to replicate what the discounted terminals did. Only 37% of the total base of healthcare professionals have adopted the system.

Transformational Leadership Strategies For Greater System Adoption

A transformational leader would have concentrated on making sure the new IS system would be seen as a critically important new platform on which healthcare professionals could have continued to grow their careers. Many of the modules in the next system, if mastered at an expert level, could lead to significant gains in salaries. Yet the managers took a more transactional, even authoritative approach to practically enforcing compliance. A transformational leader is capable of creating a high level of trust through the use of authenticity and transparency, and also creates momentum around a compelling vision that an organization can only accomplish with everyone making a valued contribution (Hargis, Watt, Piotrowski, 2011). The foundational elements of transformational leadership are "idealized influence, inspirational motivation, intellectual stimulation and individualized consideration" (p. 54) which together define the foundation of a transformational leader's credibility (Hargis, Watt, Piotrowski, 2011).

A transformational leader is capable of taking even the most challenging situations that would force a manager into a more authoritarian mindset and stay focused on creating a compelling vision. A transformational leader would have looked at the short timeframes for the IS implementation and pushed back to give the healthcare professionals more time to manage the transition, empowering them to have greater control over their jobs and how the system could complement them (Johnson, Johnson, Nicholson, Potts, Raiford, Shelton, 2012). Transformational leaders bring meaning into work even if that means taking more time on complex tasks (Smith, 2011).

Transactional Leadership Response to the Short Implementation Timeframes

Extensive use of contingent rewards, and a reliance on a carrot-and-stick management style is what pervades the IS implementation, with mediocre results being achieved of only 37% system adoption. This reflected a lack of ownership on the part of many of the healthcare professionals affected. Just ten days of feedback time is provided by the management team to the entire population of users of the new system; and clearly resistance to change immediately took hold in the employee base of system users.

Another aspect of this transactional leadership style was the lack of two-way communication on the core aspects of this IS implementation. There was clearly a lack of focus on how to align the system to the specific needs of users, and managements' reliance on short-term rewards for long-term changes in behavior did not bridge the gap between what was needed to get the highest potential performance from healthcare professionals. The approach to short-term rewards also led to employees making it clear they would run terminal emulation programs on their laptops and even iPads if necessary to get the data they needed to do their jobs. Transactional leadership works well with short-range goals and objectives, and is ineffective in making visionary, long-term behavior changes in an organization (Hargis, Watt, Piotrowski, 2011). As a result of relying on transactional leadership the IS implementation was only somewhat successful, it failed to gain the critical mass necessary to be considered successful by the IS system integration partners that worked on the project as well.

Assessment of Leadership Styles Ideally Suited to IS Implementation Projects

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