Relationships among Transformational Leadership, Subordinate Maturity, Capability and Strategy, and their Implications

Organizational development is premised on leaders ensuring that individuals grow in skills, knowledge, and abilities needed for high level performance now and in the future. Most multinational organizations use local resources and technologies, combined with their headquarters' core competencies, to generate organizational profit and maintain efficiency in the global market. The purpose of this explanatory survey research was to test a hypothesized model about the relationships among transformational leadership, subordinate maturity, capability and strategy, and their implications for Taiwan's multinational organizations. A total of 300 managers employed by various multinational enterprises in Taiwan were invited to participate in the study. All scales were examined for reliability and construct validity followed by hierarchical (forward) linear regression analyses that tested explanatory hypotheses. The findings indicated that: (a) transformational leadership was a significant explanatory variable of capability (4.2%; (b) subordinate maturity and capability were significant explanatory variables of strategy; and (c) transformational leadership, capability (control and coordination mechanisms) explained 10%-12% of internal strategy and external strategy. Future research can explore relationships among leadership styles, knowledge management, and organizational performance in Taiwan's multinational enterprises.