CA Inter P6 · Chapter 14 · Question 10 of 10
A CEO inspires employees with a compelling vision, encourages them to challenge old ways of working and motivates them to go beyond their own interests for the organisation's transformation. This is best described as:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) Transformational leadership
Explanation
Transformational leaders use charisma, vision and intellectual stimulation to motivate people to commit to change and perform beyond expectations. This suits organisations going through major strategic change. Transactional leaders rely on rewards, penalties and existing structures to achieve set goals, which suits stable conditions.
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