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Owing to its relationship with change and transformation, transformational leadership theory should be relevant to managing change and transformation linked to diversification investments. However, the question of what model of transformational leadership would be appropriate for managing change and transformation linked to diversification investments has not been addressed. The purpose of this research was to explore managers’ perceptions of the links between transformational leadership and diversification strategies.Using a qualitative research method, this study provides a critical analysis of the transformational leadership theories and triangulation with the behaviours of 30 purposively sampled managers from ten firms involved in different diversification activities. The aim of this was to determine the most appropriate transformational leadership model for managing change and transformation linked to diversification investments. Besides the degree of industry predictability and certainty, the findings echoed the reasoning in the full-range transformational leadership theory that a continuum of transformational-transactional leadership behaviours enhances effective management of diversification-related changes and transformation. However, no similar transformational leadership model was found to have been adopted by prior studies or enterprises engaged in different diversification activities. The study should fill this gap by identifying a new transformational leadership theory that links the full-range transformational leadership theory to Ansoff’s model for diversification and growth improvement strategies.

A transformational leadership model for managing change and transformation linked to diversification investments