Transformational leadership addressing team performance: situational challenges in corporate settings

Team performance is essential for organizational success in contemporary settings, where diverse talents and perspectives are utilized to tackle complex challenges and drive innovation (Unger-Aviram et al., 2022). However, the understanding of how leadership styles influence these outcomes remains incomplete, particularly concerning transformational leadership. Although transformational leadership is widely recognized for its ability to inspire and motivate teams toward higher performance, gaps persist in understanding how specific situational challenges affect its effectiveness in dynamic team environments (Bass and Riggio, 2006; Crewther et al., 2020; Dionne et al., 2004). Bridging these gaps is vital for enhancing team cohesion and performance, particularly in rapidly evolving corporate environments (Mach et al., 2022). Therefore, further research is required to enhance our understanding of how transformational leadership can be optimized to address critical barriers to team effectiveness, particularly in emerging markets like Brazil.

This study draws on key theories of team performance and leadership, including the input-process-outcome model of team dynamics (Guzzo and Shea, 1992) and transformational leadership theory (Bass and Riggio, 2006). These frameworks are particularly relevant, as they offer insights into how leadership shapes team performance through mechanisms like communication, conflict resolution and role clarity (Jacobsen and Salomonsen, 2020; Leung, 2008). The intersection of these theories enables an exploration of the underlying processes through which transformational leadership influences team outcomes and aids in identifying situational challenges that may hinder its effectiveness. Despite substantial research linking transformational leadership to team performance (Schaubroeck et al., 2007), there is a notable gap in understanding how factors such as workload distribution and role ambiguity affect the success of transformational leadership in specific contexts (Çelik and Köse, 2022; Yan et al., 2023). Therefore, this study seeks to address the research question: How do situational challenges influence the effectiveness of transformational leadership in enhancing team performance?

To address these gaps, this research examines the impact of situational challenges such as a lack of synergy, minor conflicts, unspoken dissatisfaction, workload ambiguity and uneven opportunities for idea-sharing on the effectiveness of transformational leadership. By combining a comprehensive literature review with a grey-based decision-making model, the study evaluates the effects of these situational challenges on team performance in Brazilian companies. By doing so, this study seeks to uncover the key factors that hinder transformational leadership and propose evidence-based solutions to enhance leadership effectiveness in team settings. The findings indicate that preparation and shared cognition are vital for addressing the inherent challenges of transformational leadership. Uneven workload distribution, for instance, emerged as a significant barrier to team cohesion and performance. Addressing this barrier with targeted transformational leadership strategies can optimize team dynamics and improve organizational outcomes.

The contribution of this study lies in its focus on the overlooked situational challenges in team environments and their implications for transformational leadership. By providing a clearer understanding of these dynamics, this research advances both theory and practice, offering actionable insights for improving leadership effectiveness and team performance in corporate settings. At the conclusion of this paper, readers will have a better grasp of how specific situational problems interact with transformational leadership and how targeted strategies can mitigate these issues.

The remainder of the paper is structured as follows: The literature review provides a detailed exploration of existing theories and empirical studies on situational problems in transformational leadership and team performance. The methodology outlines the research design and analytical approach, followed by the presentation of findings that highlight key barriers to effective leadership. The discussion interprets these findings and offers recommendations for enhancing transformational leadership in Brazilian corporate environments, with the conclusion summarizing the contributions and implications for practice.

Transformational leadership is a style that motivates and inspires followers to transcend individual interests in pursuit of a shared vision. Bass and Riggio (2006) define transformational leadership by four key components: idealized influence, inspirational motivation, intellectual stimulation and individualized consideration. These elements empower leaders to foster significant changes by creating an environment where team members are encouraged to innovate, collaborate and develop their potential. These authors argue that transformational leaders not only focus on team performance but also promote the development of individuals within the team, enhancing both collective and individual outcomes. Similarly, Guzzo and Shea (1992) highlight the critical role of leadership in shaping team effectiveness. Their framework highlights the importance of leaders in creating favorable team environments, where shared goals, communication and mutual support drive performance. They argue that leadership influences not only the outcomes but also the processes within teams, such as decision-making, conflict resolution and workload distribution. These frameworks align with team climate theory, as outlined by Schneider et al. (2013), which emphasizes the role of shared perceptions and collective behavior in shaping team outcomes. Crewther et al. (2020) further argue that the inclusion of contextual variables, such as cultural factors and situational challenges, within the transformational leadership model is essential for understanding performance dynamics more comprehensively. By exploring how situational challenges disrupt team climate, we can also better assess the practical limitations of traditional transformational leadership models. This critical analysis highlights areas where such models may fall short, particularly in addressing context-specific challenges in corporate environments.

Although transformational leadership is widely associated with positive team dynamics, climate and performance, there remains a gap in understanding how specific situational challenges – such as a lack of synergy, minor conflicts, unspoken dissatisfaction, workload imbalances and limited idea-sharing – interact with transformational leadership to influence team performance. These situational challenges may affect the effectiveness of transformational leadership differently, particularly within Brazilian corporate environments. Brazilian organizations frequently encounter unique cultural and operational contexts that may influence leadership models differently from those in Western settings (Carvalho et al., 2022; Nolte and Schenoni, 2024). For instance, Brazilian leadership emphasizes personal relationships and trust-building, fostering strong interpersonal connections, whereas Western cultures often prioritize efficiency and individualism. Additionally, Brazilian culture tends to be more collectivist, emphasizing group cohesion, while Western leadership often prioritizes individual achievement and competition (Fischer et al., 2014; Kroumova and Mittal, 2023; Schroevers and Higgins, 2020). Several authors (Casado, 2018; Chammas and Hernandez, 2019; Oliveira, 2011) also emphasized that leadership in Brazil often revolves around relationship-building, collectivism and navigating hierarchical structures, which contrasts with the more individualistic and direct styles typical in Western countries. This nuanced understanding of transformational leadership in Brazil can inform strategies to address specific situational challenges in other organizations.

In contemporary organizational contexts, a major challenge for transformational leadership is managing team members’ individualistic behaviors, which can undermine synergy. Choi and Yoon (2018) suggest that teams generate more innovative ideas when members balance a collectivistic value orientation with an independent mindset, yet the lack of synergy within teams remains a complex issue (Choi and Yoon, 2018). This challenge requires nuanced, strategic interventions that promote collaboration and collective efficacy (Fiorentino and Garzella, 2015; Van Knippenberg et al., 2020). The literature emphasizes the role of effective transformational leadership in creating environments where open communication and a shared vision align individual efforts toward common goals. However, closer analysis reveals that this alignment depends not only on clear communication but also on a leader’s capacity to manage diverse individualism-collectivism orientations within the team. Yan et al. (2023) highlight that subordinates’ cultural orientations significantly interact with leadership, influencing their emotional responses and subsequent behaviors in group settings (Yan et al., 2023). Leaders must therefore be adaptable, recognizing and responding to these cultural dimensions in a way that promotes positive emotional engagement and collaborative behavior. While fostering synergy is often framed as a matter of promoting shared goals, this overlooks the critical role of psychological safety and team dynamics in facilitating collaboration. Furthermore, continuous development initiatives such as targeted training programs (Agustian et al., 2023), structured feedback mechanisms (Zhang et al., 2020) and the cultivation of a culture of continuous improvement (Rizzardo, 2020) are crucial to sustaining team synergy.

Small conflicts within organizations can have significant consequences, posing challenges for transformational leadership and adversely affecting the organizational climate (Leung, 2008). While these conflicts may appear minor, their cumulative impact can be substantial if not addressed promptly. If left unresolved, these conflicts erode trust among team members, disrupt communication and reduce overall morale and engagement (Winardi et al., 2022). However, it is important to recognize that the presence of small conflicts is not inherently problematic; rather, it is how leadership responds to them that determines their broader impact on the organization. Leaders must critically assess whether they are fostering an environment that allows small conflicts to fester. Unaddressed tensions can lead to a toxic workplace culture, characterized by gossip, resentment and a lack of psychological safety, which ultimately hampers decision-making processes and disrupts talent management efforts (Rahim, 2023). This underscores the importance of leadership in not only resolving conflicts but also cultivating an organizational climate that minimizes their occurrence. While promoting open communication (Jacobsen and Salomonsen, 2020) and inclusivity (Tulshyan, 2024), which are commonly cited as essential leadership practices, they require deeper critical engagement. For instance, fostering a culture of respect and inclusivity is not achieved merely through policy statements or diversity initiatives. Leaders must embody these values consistently, demonstrating through their own actions how conflicts should be handled. Effective conflict resolution requires leaders to be skilled in emotional ability and adept at facilitating discussions that promote empathy and mutual understanding.

Unverbalized dissatisfaction poses a significant challenge for transformational leadership, especially in the context of organizational performance evaluations (Inayat and Jahanzeb Khan, 2021). Although performance reviews aim to facilitate open dialog between employees and supervisors, many employees withhold concerns, grievances or dissatisfaction that they do not express openly. Such silence can be more damaging than overt dissatisfaction, as it is harder to address and often remains hidden until it leads to reduced morale, engagement or productivity. Bohórquez et al. (2022) revealed that 42% of employees within the Government of the province of Santa Elena expressed dissatisfaction with organizational equity, suggesting that this dissatisfaction, though under the surface, can significantly impact work performance. The study’s recommendation for implementing motivational strategies highlights the need for targeted leadership interventions aimed at addressing dissatisfaction before it becomes unmanageable. However, while motivational strategies are essential, they are not a cure-all for unverbalized grievances. This issue reflects deeper challenges within organizational culture, particularly in terms of psychological safety and trust. If employees do not feel safe or empowered to voice their concerns, no amount of external motivation will suffice in remedying underlying dissatisfaction. Welter and Ensslin (2022) emphasize that a lack of open communication in performance reviews can lead to misunderstandings, strained relationships and a loss of trust in feedback and appraisal mechanisms. Therefore, the challenge for transformational leadership is not only to identify dissatisfaction but also to cultivate an environment where employees feel safe and supported in expressing it openly (Welter and Ensslin, 2022). As Jacobsen and Salomonsen (2020) and Zeng et al. (2020) argue, transformational leaders must prioritize creating a culture of open communication and trust. However, promoting psychological safety is more than just encouraging feedback – it requires leaders to actively model vulnerability, transparency and responsiveness.

Unequal workload distribution represents a critical challenge for transformational leadership, disrupting team dynamics and undermining organizational effectiveness. Overburdened team members often suffer from decreased motivation and feel unappreciated or unfairly treated, which can lead to reduced engagement and commitment (Bohórquez et al., 2022). This imbalance undermines individual morale and disrupts team cohesion, as resentment toward those with lighter workloads can cause interpersonal tensions and hinder collaboration (Black et al., 2019). Furthermore, overworked employees face a significant risk of burnout, which can lead to decreased productivity, absenteeism and reduced overall team performance (Verbeke, 1997). Critically, when employees perceive inequity in workload distribution, it erodes trust in leadership, reducing the team’s effectiveness and their willingness to follow a collective vision (Pritchard et al., 1972). The impact of unequal workload distribution extends beyond individual well-being to stifle innovation and creativity, as overburdened employees often lack the time and cognitive resources needed for creative problem-solving or adapting to challenges (Gantert et al., 2022). This dynamic severely limits the team’s ability to drive innovation, an essential goal for transformational leadership. Addressing these issues requires transformational leaders to prioritize fairness and transparency in workload management (Çelik and Köse, 2022). Effective leaders should assess team members’ individual capacities, expertise and availability to ensure an equitable distribution of tasks. This approach not only prevents overload but also fosters a sense of fairness and mutual respect within the team. Moreover, providing adequate support and resources for those with heavier workloads can mitigate negative effects, while recognizing and valuing their contributions can enhance morale and motivation (Rafferty and Griffin, 2004). Encouraging a collaborative team environment is also essential and transformational leaders should facilitate discussions to identify solutions for balancing workloads and improving efficiency, helping redistribute tasks more equitably (Bass and Riggio, 2006).

Transformational leadership encounters a significant challenge when certain team members suppress others’ ideas due to dominant personalities, fear of criticism, inadequate psychological safety or a competitive environment (Bass and Riggio, 2006). This dynamic is problematic, as it suppresses creativity and innovation, key pillars of transformational leadership. Suppressing idea-sharing deprives teams of diverse perspectives and potential breakthroughs, limiting their ability to adapt (Miller and Katz, 2010). A lack of open dialog can foster distrust and resentment among team members, adversely affecting collaboration and overall performance (Saunders et al., 2014). It doesn’t just affect innovativeness, creativeness and adaptiveness; it can fundamentally compromise a team’s problem-solving abilities (Gantert et al., 2022). Ideas form the foundation of effective problem-solving, and when some members are silenced, the team struggles to address challenges efficiently (Grawitch et al., 2003). Furthermore, the lack of opportunity to contribute leads to frustration, disengagement and diminished morale, ultimately lowering motivation and team cohesion (Alshwayat et al., 2021). By preventing the expression of ideas, the team underutilizes its collective expertise, leaving valuable skills and perspectives untapped (Hackman, 2002). Transformational leaders must foster a culture of psychological safety, ensuring that team members feel confident sharing ideas without fear of judgment (Zeng et al., 2020). Leaders should facilitate openness and ensure that all members have equal opportunities to contribute. Actively involving more assertive members in structured brainstorming and decision-making sessions can encourage a more inclusive dialog (Tulshyan, 2024). In cases where disruptive behaviors persist, prompt intervention through coaching, training or conflict resolution is essential to maintaining team harmony and effectiveness (Mobolade and Akinade, 2021). Critically, transformational leaders must recognize that emotionally secure environments and inclusion are not mere facilitative tactics – they are central to fostering creativity, cohesion and sustained performance.

This study uses the grey-based multi-criteria decision-making (MCDM) approach, which is a mathematical framework used for modeling and analyzing systems with limited or incomplete information. It was developed by Deng Julong in the early 1980s as a response to the challenges posed by systems that have uncertainty or lack precise data. The key concept in grey theory is the notion of grey numbers, which represent information that is partially known or imprecise. Grey theory finds applications in various fields such as economics, engineering, environmental science and management, where uncertainties or incomplete information are common (Li et al., 2007). It provides a systematic and structured approach to dealing with ambiguity and can be particularly useful in decision-making processes where precise data are scarce or difficult to obtain (Liu and Lin, 2010).

The sample comprised 27 Brazilian leaders selected for their extensive team management experience and advanced academic qualifications, with all participants holding Ph.D. degrees. These leaders also had an average of 18 years of managerial experience, offering a strong foundation for insights into leadership practices within Brazilian organizations. To ensure diverse representation of leadership styles and industries, participants were recruited from sectors such as finance, healthcare, technology and manufacturing. This diversity allowed for a comprehensive understanding of the challenges faced by leaders in different contexts. Participants were approached through a combination of professional networks and direct outreach. Initial contact was made via email, where the purpose of the study was explained, and their potential participation was solicited. A follow-up was conducted to address any questions and to confirm their willingness to participate. Ethical review and approval for the study were obtained from a committee for ethical compliance in the context of research involving human beings at the academic institution level, and all necessary permissions were secured before participant engagement. The participation of these highly experienced and academically qualified leaders enriched the findings, grounding the results in both real-world leadership dynamics and comprehensive professional experience within the Brazilian context.

The Brazilian leaders, as decision-makers (DMs), expressed opinions regarding situational challenges identified in the literature such as lack of synergistic action by team members, who act in a very individualistic way (TWS1), small conflicts between some team members that undermine the organizational climate (TWS2), unverbalized dissatisfaction arising from disagreement in relation to performance evaluations (TWS3), unequal distribution of workload between team members, generating overload for some (TWS4) and existence of team members who, in some way, inhibit the exposition of ideas by other people (TWS5). Each situational challenge was assessed based on its frequency, detection and the preparedness of Brazilian leaders to address it, using the linguistic terms and grey scales. The respondents’ opinions in terms of grey numbers were aggregated by simple average (Equation 1), and based on the information obtained, the decision matrix was structured (Equation 2). Obtain ratings based on criteria for frequency, detection and preparation from DMs for each of the three situations.

A matrix comprising three columns (preparation, frequency and detection) and five rows (each representing analyzed situational challenges) is constructed, with each cell containing a grey number. The subsequent step involves normalizing the decision matrix $D*$⁠. For the criteria of “preparation” and “detection,” normalization based on the concept of “benefit” is utilized, where higher grey concept values are considered better (Equation 3). Conversely, for the criteria of “frequency,” normalization by “cost” is employed (Equation 4), with lower grey concept values being preferable. The equations for normalization using the concepts of “benefit” and “cost” for grey numbers are

After normalizing the data matrix, the next step involved weighting the data according to the criterion weights. We applied the grey scale for assigning weights, along with the following attribution. Similarly, other grey-weighted normalized values are obtained $D**$⁠. The normalized data matrix allowed us to determine the optimal solution for each criterion, forming the vector referred to as $Gmax$⁠. Subsequently, we computed the degrees of possibility between each of the analyzed situations (TWS1 to TWS5), as indicated below (Equation 5).

The results adhere to the steps outlined in the previous section. Table 1 presents each situational challenge (TWS1 to TWS5) evaluation in terms of frequency, detection and the preparedness of Brazilian leaders to address it, using the linguistic terms and grey scales.

Table 2 presents the criterion ratings for the five situational challenges. Subsequently, the decision matrix, shown in Table 3, includes grey numbers for preparation, frequency and detection for each analyzed challenge. The subsequent step involves normalizing these decision matrixes, as presented in Table 4.

After normalizing the data matrix, the next step involved weighting the data according to the criterion weights. Table 5 shows the grey scale for assigning weights, along with the following attribution.

The grey-weighted normalized decision matrix (D**), shown in Table 6, offers a detailed view of the situational challenges (TWS1 to TWS5) faced by Brazilian leaders, with a focus on three key criteria: preparation, frequency and detection. TWS3 exhibited the highest level of preparation (0.556701), suggesting that leaders feel better equipped to address this challenge. In contrast, TWS5 has the lowest preparation score (0.440722), suggesting that leaders perceive themselves as less prepared to manage this situation. The frequency scores reflect how often each situation is encountered by leaders. TWS3 again has the highest frequency (1.000000), indicating it is the most common challenge faced. Conversely, TWS5 has the lowest frequency (0.845361), suggesting that it is encountered less often. Detection scores highlight leaders’ ability to recognize these challenges. TWS2 exhibited the highest detection score (0.205357), indicating that leaders feel more confident in identifying this challenge. TWS5, with a detection score of 0.135294, shows the lowest capacity for recognition among the challenges.

Comparative insights reveal that TWS1 and TWS2 have relatively high preparation and frequency scores, indicating that these challenges are both significant and well understood by leaders. The balance between preparation and frequency indicates that leaders are aware of these situations and feel adequately prepared to address them. TWS4 presents a similar pattern, with moderately high preparation and detection scores, indicating that while it may be encountered frequently, leaders have a fair level of confidence in their ability to identify and manage this situation. TWS5 stands out as a challenge that is perceived as less frequent and with low preparation and detection scores. This suggests that it may not be prioritized by leaders, potentially leading to a lack of proactive strategies for addressing it. Leaders seem to have a good understanding and readiness for challenges such as TWS1 and TWS2, while TWS5 may require more attention to enhance leaders’ preparedness.

Lastly, Table 7 highlights the grey possibility degrees for other alternatives. The probability degrees provide insight into the likelihood that each alternative will effectively address the respective situational challenges. This analysis of grey possibility degrees and their corresponding probabilities indicates a range of viable alternatives for addressing the situational challenges faced by Brazilian leaders. While some alternatives demonstrate significant promise, others may require further development or reevaluation. These insights gained from this analysis can guide leaders in selecting the most effective strategies tailored to their unique challenges and foster improved outcomes in their organizational contexts.

The study’s findings underscore the critical importance of preparation in transformational leadership, especially for addressing team performance challenges in the Brazilian context. Our findings suggest that preparation emerges as the most significant criterion for effective transformational leadership, especially concerning workload distribution issues, where an unequal workload poses severe risks to team cohesion and performance. The elevated weight of preparation in TWS4 (unequal workload distribution) underscores its central role in managing complex team dynamics, aligning with existing literature that emphasizes readiness, strategic foresight and proactive planning in leadership (Bass and Riggio, 2006). In Brazil, the collectivist mindset emphasizes teamwork, group harmony and shared responsibility, making unequal workload distribution particularly problematic because when team members perceive an imbalance in individual identity, it can lead to resentment and conflict, disrupting trust and cohesion.

Well-prepared leaders can anticipate and resolve these imbalances, mitigating burnout, resentment and disengagement among team members while fostering a healthier organizational climate (Bohórquez et al., 2022). The emphasis on relationships and teamwork in Brazilian culture underscores the need for leaders to maintain harmony within their teams, as conflicts arising from workload disparities can disrupt this balance (Hofstede, 2013). Further analysis of the degrees of possibility reinforces the significance of preparation as a decisive factor in the success of transformational leadership. TWS4 (unequal distribution of workload) was identified as the most suitable scenario for transformational leadership interventions, exhibiting the lowest degree of possibility or the closest alignment to the ideal alternative. This finding is crucial as workload distribution issues not only affect individual team members but also have broader implications for team cohesion, innovation and long-term productivity (Alshwayat et al., 2021). In the Brazilian context, where organizations often face resource constraints and high expectations for performance, transformational leaders must demonstrate foresight and adaptability, redistributing tasks equitably and offering support to those most affected by workload disparities (Rafferty and Griffin, 2004).

The second most critical issue identified was the lack of synergistic action among team members (TWS1), requiring a strong focus on the detection criterion. Our results suggest that transformational leaders must be adept at detecting early signs of individualistic behavior that undermine team synergy. This aligns with research by Choi and Yoon (2018), who argue that promoting collectivism within teams, while respecting individual autonomy, leads to more innovative and cohesive outcomes. In Brazilian corporate environments, where social relationships are pivotal, fostering open communication and shared goals is essential to mitigate the risk of fragmentation within teams (Mobolade and Akinade, 2021; Zaharie, 2021). Conversely, TWS5, which pertains to team members inhibiting idea expression, had the highest degree of possibility, making it the least suitable for transformational leadership interventions. This result suggests that traditional leadership strategies, which focus on inspiration and motivation, may not be as effective in addressing deep-seated issues related to psychological safety and idea-sharing dynamics (Gantert et al., 2022). Leaders in such scenarios may need to complement the transformational leadership model with more targeted interventions, such as fostering a culture of inclusivity and providing safe spaces for open dialog (Zeng et al., 2020). Tackling power imbalances and dominant personalities within the team is vital to ensuring that all members feel empowered to contribute ideas, a key factor for innovation and problem-solving (Tulshyan, 2024).

Overall, the findings reveal the centrality of preparation in transformational leadership and highlight the necessity for leaders to be both proactive and adaptive in addressing team performance challenges. In Brazilian corporate settings, where a collectivist mindset often prevails, the focus on preparation takes on added significance, as leaders must navigate complex team dynamics shaped by cultural expectations of collaboration and interdependence. This contrasts with other Western contexts, which may prioritize individual achievement and autonomy, leading to different approaches in managing workload distribution and fostering team cohesion. For leaders working with multinational teams, understanding these cultural nuances is critical. They must adapt their transformational leadership strategies to accommodate diverse cultural backgrounds, recognizing how varying values can influence team dynamics. An effective leader must be prepared not only to address unequal workload distribution but also to foster an inclusive environment that respects individual differences while promoting spaces to exhibit ideas and collective goals.

While this study is focused on the Brazilian context, the insights gained extend well beyond its borders, offering valuable implications for leadership development in other emerging markets. The challenges identified, such as workload imbalances and the necessity for preparation in transformational leadership, resonate with issues faced by leaders globally. These findings suggest that leaders in diverse cultural settings can adapt the strategies discussed to enhance team dynamics and employee well-being. Furthermore, the emphasis on preparation as a proactive approach can inform public policy initiatives aimed at improving organizational outcomes across various sectors. Incorporating these insights into leadership training and development programs can help organizations in emerging markets cultivate environments that enhance performance while promoting sustainable growth and innovation.

This study introduced a grey-based methodology to tackle preparation, detection and frequency challenges within team scenarios by employing an MCDM approach. Five critical situations, combined with three essential criteria for transformational leadership identified in existing literature, were evaluated using grey numbers to account for uncertainties in DMs’ inputs. The grey approach, implemented through a structured “grey decision matrix,” “grey normalized decision matrix” and “grey-weighted normalized decision matrix,” provided a rigorous framework for assessing the relevance and impact of transformational leadership in diverse organizational contexts. This methodology allowed for the precise calculation of grey possibility degrees, helping to classify alternative team situations in terms of their alignment with effective transformational leadership.

The theoretical implications of this study are substantial, particularly in advancing the understanding of transformational leadership’s adaptability to diverse team performance challenges. By emphasizing preparation as the most critical criterion across situational contexts, this research reinforces the importance of strategic foresight, resource allocation and proactive leadership in enhancing team performance. The grey-based methodology adds to the existing literature by providing a novel, quantifiable approach to evaluate the effectiveness of transformational leadership under uncertain conditions, thus bridging a crucial gap in transformational leadership theory. This study also contributes to leadership scholarship by integrating grey theory into the exploration of transformational leadership’s situational dynamics, offering a more nuanced understanding of how leaders can adjust their strategies based on specific team challenges.

From a practical standpoint, the findings offer actionable insights for managers and leaders. Preparation, identified as the most suitable criterion for improving team outcomes, should be prioritized in leadership development programs and organizational strategies. The grey-based approach provides a valuable tool for managers to systematically evaluate team dynamics and leadership interventions, particularly when faced with complex, ambiguous decision-making environments. By applying this methodology, managers can better allocate resources, anticipate potential challenges and develop tailored strategies that align with the specific needs of their teams, thereby improving overall performance and fostering a positive organizational climate. The practical utility of this approach is underscored by its flexibility, allowing leaders to adjust to the unique demands of their organizations, whether in mitigating workload imbalances, enhancing team cohesion or fostering creativity and innovation.

While this study makes valuable contributions to both theory and practice, it is not without limitations. One key limitation is the reliance on expert judgment in assigning weights and ratings to the criteria and situations. Although the experts involved were well versed in the complexities of transformational leadership, the subjectivity inherent in these evaluations may affect the generalizability of the findings. Future research should consider expanding the pool of DMs or incorporating more objective measures to validate and strengthen the grey possibility calculations. Additionally, the study focuses on a limited set of situations and criteria. Exploring a broader range of team dynamics, such as cross-cultural influences or industry-specific challenges, would provide a more comprehensive understanding of how transformational leadership functions in diverse contexts.

Another limitation lies in the application of grey theory itself. While grey theory provides a structured way to handle uncertainty, it may oversimplify complex, multifaceted organizational dynamics that require a deeper qualitative understanding. Future research could integrate mixed-method approaches, combining grey theory with qualitative analysis to capture the nuanced leadership behaviors and team interactions that quantitative models may overlook.

Finally, this study primarily examined transformational leadership within Brazilian corporate settings. Future studies should replicate and extend the research across different geographical and organizational contexts to enhance the external validity of the findings. Investigating how transformational leadership adapts to different cultural norms, regulatory environments and organizational structures would contribute to a more globally relevant understanding of transformational leadership’s role in addressing team performance challenges. Moreover, as workplaces continue to evolve, especially with the rise of remote and hybrid work arrangements, future research could explore how transformational leadership operates in virtual teams, where preparation, detection and the frequency of leadership interventions may take on new forms and challenges. By offering a grey-based decision-making framework that enhances our understanding of transformational leadership’s role in addressing team performance issues, this study presents a robust methodology for evaluating leadership effectiveness across diverse contexts, equipping managers and scholars alike with the tools needed to navigate the intricate dynamics of modern organizational life.

Funding: This research was funded by Coordenação de Aperfeiçoamento de Pessoal de Nível Superior (CAPES), Brazil, grant number 001.