ORLANDO—A credit union won’t be truly successful without the CEO delivering “transformational leadership,” asserts one expert.
“Leadership matters a lot,” said Chris Stokes, a four-time Olympian as a member of the Jamaican bobsled team and author of the book that profiled their story, “Cool Runnings.” “Look at any business or sports team that has been great, the leaders make the difference. The quality of the leadership makes a difference.”
Stokes, speaking to attendees at CSCU’s 2017 Annual Conference, explained that there are two typical distinctive forms of leadership—transformational and transactional leadership.
“Transactional leadership is I pay you to do something and you get it done. That leads to ordinary results,” said Stokes, also founder and executive chairman of money services firm NCS Enterprises. “Transformational leadership is about ideals and frameworks. It leads to extraordinary results. It generates performance beyond expectations.”
Stokes said the difference between being transactional and transformational is all based on leadership style.
Stokes said one aspect of transformational leadership is simply leading by example.
“You have to embody all you wish to see take place within your organization. You have to be the change that you want to see,” said Stokes. “You can’t expect your managers to be innovative and persistent if you are not those things yourself. This is idealized influence.”
Transformational leaders also challenge themselves to learn more and provide staff with opportunities to gain knowledge and grow.
“Because you can’t do everything yourself,” said Stokes. “This is a critical part of transformational leadership. You have to be able to delegate and trust the people to do the job.”
Strong leaders, too, inspire their teams, said Stokes, and that includes stopping to celebrate successes big and small.
“It can be a small win that you celebrate, it does not mean you wait until you get the gold medal,” said Stokes.
As Stokes pointed out, transactional leadership is paying someone to do a job. He said that trait is necessary in strong leaders, too, especially at organizations like credit unions where strict rules need to be followed.
“This is not sexy stuff, but it is important,” said Stokes. “You have to follow rules because the examiners and auditors are coming and they don’t care that you are empowering people. Transactional leadership is putting gas in the car.”
Another leadership point shared by Stokes: Match people’s personalities with their roles. “You don’t want a loan officer who is so empathetic that if a person cries he gives them the loan.”
“Is transformational leadership for you?” asked Stokes. “It is. But so is transactional leadership. For credit unions you have to have a strong transactional culture since following rules is so important for you. But if you are just transactional, you might be a good credit union. If you are also transformational, you can be great.”