How to become a transformational leader in the AI era

Note: The following article was originally published on Forbes on April 26, 2024. You can read the full article here.

The unprecedented shift in power that the AI era is bringing to the workplace means leaders need to get comfortable with being uncomfortable. As we all know, change is never easy. The past few years have pushed leaders into entirely uncharted territory; my memories of the many risks I took in 2020 are still vivid. The upheaval of the global pandemic made the traditional approach of prioritizing stability and predictability much less effective and left leaders with a choice: adapt in real time or risk being left behind.

AI's promise to bring about transformational change is unparalleled in its disruption in the digital era. In light of this promise, how can leaders adapt a leadership style congruent with our time, regardless of the industry they lead?

What is transformational leadership?

Over the last century, the field of psychology has espoused different leadership styles. Research led by psychologist Kurt Lewin established three leadership styles: authoritarian (autocratic), democratic (participative) and laissez-faire (delegation). Other researchers have uncovered other leadership styles, including transformational, transactional and servant leadership.

Transformational leaders are those particularly adept at leading organizations that need to stretch and change. To be a transformational leader, you need to inspire others to achieve goals that they may have deemed too far-reaching. It is also important to get comfortable with change and why it’s needed, as well as be willing to develop your team’s abilities and expertise.

Transformative leadership calls for thriving in a state of change. Existing in a state of constant readiness means adapting to potential disruptions while welcoming new opportunities. Constant vigilance requires a willingness to make tough decisions, often with incomplete information. Unlike the comfort of relying on established protocols, transformative leadership means navigating with ambiguity, weighing calculated risks against potential rewards, and seeking new knowledge and perspectives. Active listening and open communication are also essential.

If you are considering prioritizing transformative leadership, here are a few important points to keep in mind.

What are the elements of a transformational leader?

• Willingness to Act

Sometimes, playing it safe is the worst action an organization can take. It's a lesson learned the hard way by industry giant IBM, whose initial hesitation during the PC revolution is a cautionary tale for any leader unwilling to take calculated risks. Once the darling of tech, IBM's mainframe computers were the standard for businesses—powerful, secure and reliable. That is, until the personal computer (PC) hit the market and forever changed people's perspectives globally.

IBM's initial reluctance to bet big on PCs is a classic example of how clinging to the familiar can lead to missed opportunities on a grand scale. This cautionary tale underscores why transformative leadership, marked by a willingness to take calculated risks, is important to thriving in the modern business world.

I can attest that decisive action, even in the face of uncertainty, is often preferable to the paralysis of indecision. There have been many occasions when I needed to act in the organization's best interest, even when I was not 100 percent sure of the outcome. The safest path isn't always the right choice when the aim is organizational growth, and making judgment calls under pressure is often the difference between seizing opportunities and watching them slip away. Not taking a risk can be the greatest risk of all.

• Growth Mindset

Transformative leadership is also rooted in a growth mindset. Leaders who want to outperform the competition and build resilient organizations should embrace this model. I have found that excelling in business requires embracing change and inspiring your people to do the same.

Part of a growth mindset is developing the skills of your team—a vital commitment in the AI era. Equipped with adequate preparation, your team can have the autonomy to make important decisions. As they navigate challenges, learn from mistakes and reap the rewards of success, they can also gain the experience and confidence necessary to step into more significant roles.

• Trust and Communication

Successfully navigating the unknown requires trust between leaders and their teams. Secrecy breeds suspicion, but open dialogue can lead to collaboration and shared purpose. Transformative leaders should demonstrate integrity, transparency and a willingness to admit mistakes by sharing information openly, explaining decisions clearly and actively soliciting feedback.

Doing so can help improve your organization's psychological safety. In my experience, team members in this kind of trusting environment are more likely to feel comfortable sharing ideas, owning their work and raising concerns and admitting mistakes without fear of reprisal. When a leader is genuinely open to feedback, it empowers team members to contribute their best ideas and knowledge, which can lead to more creative and effective solutions. With open communication and a shared commitment to the organization's success, uncertainty can become less daunting and more of an exciting opportunity for growth.

• A Vision for the Future

Transformative leaders should have a vision for the future and put their efforts into winning others over to that cause. Focus on uniting your team on a shared vision that transcends challenges and motivates everyone to push beyond their comfort zones.

Don't take resistance to change personally.

When transformative leaders act, they often face pushback—sometimes from those closest to them within the organization. Be resilient and lead from a place of conviction. Be decisive, embrace calculated risks, prioritize growth and don't let resistance derail you. And focus steadfastly on your organization's future, not on any negativity directed at you.