Leadership styles during change (transformational, transactional, servant); stakeholder management during transformation including employee consultation, customer communication, supplier relationships and community engagement; the role of corporate communication

What this dot point is asking

QCAA wants you to know the leadership styles relevant to transformation, the stakeholder management practices that support successful change, and the role of corporate communication. Both IA3 (the research investigation) and the EA frequently use a transformation context that requires leadership and stakeholder analysis.

The answer

Leadership styles during change

Multiple leadership frameworks describe styles relevant to change. The most commonly examined.

Transformational leadership

The leader inspires and motivates followers by articulating a compelling vision of the future, modelling the values the change embodies, and developing followers individually. Focused on long-term change and capability building.

Characteristics:

• Idealised influence (charisma). The leader is a role model whose behaviour followers want to emulate.
• Inspirational motivation. Articulates an attractive vision and inspires commitment.
• Intellectual stimulation. Encourages innovation and challenges assumptions.
• Individualised consideration. Develops each follower individually.

Examples: Mike Cannon-Brookes and Scott Farquhar at Atlassian; Vicki Brady at Telstra; Melanie Perkins at Canva.

Transactional leadership

The leader manages through clear performance expectations, contingent rewards (for meeting targets) and corrective action (for missing them). Focused on consistent performance against current objectives.

Characteristics:

• Contingent reward. Clear performance targets with rewards for achieving them.
• Management by exception (active). Monitoring for deviation from expected performance.
• Management by exception (passive). Intervening only when problems become serious.

Examples: many high-performing operational management environments (Coles store-management, Macquarie's variable-pay culture, professional-services partner systems).

Servant leadership

The leader prioritises the needs of followers, removes obstacles to their work, and develops their capability. Focused on enabling others to succeed.

Characteristics:

• Listening. Active listening to followers.
• Empathy. Understanding follower perspectives.
• Stewardship. Stewarding the business and its people for long-term wellbeing.
• Building community. Creating a sense of belonging and shared purpose.

Examples: Atlassian's "open and no bullshit" culture incorporates servant-leadership elements; many Australian not-for-profit and social-enterprise leaders model servant leadership explicitly.

Choosing the leadership style

The right style depends on the context.

• Major cultural or strategic transformation: transformational primary, with servant-leadership elements. The change requires belief, not just compliance.
• Operational delivery against established objectives: transactional fits, with adaptive elements when context changes.
• High-skill knowledge work: servant leadership empowers; over-direction reduces engagement.
• Crisis or emergency: more autocratic style appropriate (see VCE management styles for the related framework).

Most effective leaders blend styles across situations rather than adopting one as a fixed identity.

Stakeholder management during transformation

Major transformations affect multiple stakeholder groups. Successful change requires deliberate management of each.

Employees

The most directly affected stakeholder group in most transformations.

Practices.

• Early and structured consultation, often through union or works-council channels.
• Clear communication of decisions, rationale and timeline.
• Retraining for staff whose roles change.
• Redeployment options before resorting to redundancy.
• Generous voluntary-redundancy packages where roles are lost.
• Ongoing engagement and feedback (pulse surveys, town halls).

The Fair Work Act, awards and enterprise agreements set legal obligations on consultation and redundancy.

Customers

Communication and continuity matter.

Practices.

• Communicating changes in advance (price, service, channel).
• Dedicated support channels during transition periods.
• Continuity of service - no unplanned outages.
• Honest acknowledgement of what is changing and why.

Suppliers

Supplier relationships often change in transformation.

Practices.

• Early engagement with suppliers facing changed contracts or volumes.
• Clear timelines and transition support.
• Fair payment terms maintained (the Payment Times Reporting Act 2020 brings transparency to large-business payment of small suppliers).
• Where suppliers will be exited, reasonable notice and transition support.

Community

Community impact matters for businesses with significant local presence.

Practices.

• Communication with local councils and community organisations.
• Engagement on community-impact mitigation (job effects, environmental impact).
• Transparency about decisions affecting the community.
• For Indigenous-impact decisions, genuine engagement under the principles of the Free, Prior and Informed Consent framework.

Shareholders / owners

Owners bear the financial risk and reward.

Practices.

• Regular reporting against transformation milestones.
• ASX continuous disclosure for listed companies.
• Board oversight and governance.
• Independent assurance where appropriate.

Role of corporate communication

Corporate communication is the strategic discipline of communicating with all stakeholders. During transformation it covers:

• Internal communication. Staff briefings, all-hands events, intranet, email updates, manager cascades.
• Customer communication. Email, in-app messages, advertising, customer-service scripting, social channels.
• Investor communication. ASX announcements, investor presentations, results briefings, AGM addresses.
• Media and public communication. Press releases, media briefings, executive interviews, social-media presence.
• Crisis communication. Pre-planned responses for transformation-related incidents (project failure, public dispute, regulator action).

Good corporate communication during transformation is consistent across audiences (the message employees hear matches the message customers hear), honest (acknowledges difficulties), and timely (gets ahead of misinformation).

Bad corporate communication amplifies transformation problems. The Qantas baggage-handler outsourcing case is partly a corporate-communication failure - the public narrative was tone-deaf to the affected workers and customers.

Worked Australian examples

Vicki Brady, Telstra (T25, 2022 onwards)

Predominantly transformational leadership. Articulated a clear vision of a simpler, more customer-focused, digital-first Telstra. Modelled customer-centric behaviour personally. Invested in leadership development to build the cadre capable of carrying the change. Stakeholder management has been deliberate - employee consultation (CEPU), customer communication, regular investor updates.

Mike Cannon-Brookes and Scott Farquhar, Atlassian

Transformational and servant leadership combined. The "open and no bullshit" value sets the tone; the founders model the behaviour. Stakeholder management for employees through extensive culture investment; for customers through product-led-growth approach; for the broader community through Pledge 1 percent and visible climate activism (Cannon-Brookes's Grok Ventures investments in renewable energy and AGL).

Australia Post in the post-Christine Holgate period (2020-2022)

A case of leadership and stakeholder-management failure - the public removal of CEO Holgate over the four Cartier watches damaged executive talent attraction, employee engagement and customer trust. The subsequent CEO transitions illustrate the importance of stakeholder management at the executive level.