Zipcar: Transformational Leadership Style

Zipcar’s case with its CEO and co-founder Robin Chase is an outstanding example of overconfidence and optimism as key weaknesses of a leader. One of the key strengths of Chase is the fact that she is a prime example of a transformational leader with charismatic attributes, which allowed her to convince a wide range of people, groups, and organizations about Zipcar’s business model plausibility. From the case, it is evident that she learned both from her parents and her own life experiences that one needs to polite and respectful with others and also be flexible and adjustable in accordance with the situations. In addition, she exceptionally charismatic and extroverted individual who has excellent communication capabilities to share her vision and ideas with others, and thus, increasing the overall chance of one being interested in partaking and contributing to the company.

In regards to her personal qualities, which aid her leadership, she possesses a great deal of resilience and persistence since Chase was able to network with a large pool of various experts and professionals. It is evident that she is an illustration of a transformational leadership style, which focuses on inspiring and motivating followers by connecting with them and making them part of the team (Aga et al., 2016). Therefore, these core strengths allowed her to build a strong and highly devoted team committed to the overall mission of the company. She was also able to connect and establish positive relationships with her customers or members, which further made a mere idea into a business.

However, the case also showcases how transformational leadership can lead to major pitfalls, such as overconfidence and optimism, which resulted in her miscalculation in the pricing model. In other words, she was a highly democratic and participative leader who decided to personally manage the pricing process through an assumption that she is competent and experienced enough to so. This led to the fact that she did not have professional financial managers in her team to spot the flaws of the original pricing model in advance, which would have prevented the occurrence of the problem in the first place.

Her transformational leadership style was useful and helpful in setting up the business and launching it, but evidence suggests that one needs to incorporate both transactional model and transformation model in order to ensure proper organizational performance. It is stated: “transformational leadership is successful in a dynamic work environment, as it drives their human capital to be more flexible and to think differently. In turn, the leadership of transactions can be more conducive to innovation in a more stable business environment and can drive organizations to innovate when their objectives and activities are more stable” (Alrowwad et al., 2020, p. 216).

In other words, her approach was an effective one during the start and launch phases of the Zipcar setup, but she needed to transition or incorporate some elements of a transactional leadership style because, at the later stages, the company was entering a more stable phase. Chase was mainly adherent to her leadership style, which was useful in the beginning, but became damaging after the company grew.

Therefore, her miscalculation was the combination of, ironically, inflexible leadership style and overconfidence as well as optimism. The latter two are manifested in the fact that Chase, through her life, experienced a series of successes, which boosted her self-reliance and self-confidence. Although these traits assisted her in the making her resilient and persistent, she mistakenly considered that successes in her academic and career lives would translate to her entrepreneurial endeavors. This excessive self-belief and self-reliance prevented her from acknowledging the fact that she is not competent to carry out the financial management of the company.

By being more realistic in regards to her strengths and weakness, which come from self-awareness, she would be more likely to hire or consult professionals who could have spotted the flaw in the pricing model before customers committed to the service. Therefore, her miscalculation is the result of inflexible transformational leadership and excessive personal self-reliance, and overconfidence in her abilities. A potential solution should revolve around finding resources or opportunities to hire and consult a professional with extensive experience and knowledge in financial management. Chase should focus on her own areas of expertise and delegate other aspects of the business to more competent people. Although it might be costlier, the result will not as dire as in the case of Zipcar.

In Chase’s position, my leadership would be focused on adopting more of a transactional leadership style as well as a more delegative approach to the task at hand. It is important to note that delegative measures can be highly useful in improving organizational performance, especially among managers with no significant managerial experience (Afshari et al., 2017). Therefore, I would utilize the same leadership style as Chase during the initial periods of Zipcar’s business setup and launch, but I would switch to a more transactional format as soon as the dynamic aspect of the business becomes more stable, as was the case of Zipcar when they reached 400 members since the growth was already there and business model was a valid one.

By being more delegative, I would recognize that my area of expertise is not financial management, which is why I would hire or consult several experienced professionals in this area before determining a pricing model instead of trusting David Bell’s words. Alternatively, I would keep in contact or even try to recruit David Bell as the company financial advisor to adjust the price as he suggested (Ancona & Reavis, 2014). In other words, I would recognize my lack of knowledge in financial matters and, thus, handle the problem by seeking help.

The main problem of Chase’s leadership is rooted in her strengths, which enabled the company’s existence in the first place. She is a highly intelligent, charismatic, and persistent leader with a clear vision who can inspire and persuade others to join her mission. However, these qualities made her lose sight of her weaknesses, where she was not able to realize that her taking a course in finances does not make her an expert at designing and adjusting real-life pricing models.

Of particular importance is financial management, designed to ensure effective resource management of enterprises of various forms of assessing profitability. Thus, I would be highly self-aware and self-conscious about my own capabilities and would doubt my competence in these financial endeavors, which would pressure me to seek out help and assistance from a professional.

In addition, my approach would change towards a more transactional leadership style, where I would be more directive and focus on getting key tasks done without any form of emotional or personal involvement. Her transformational approach was beneficial at the beginning, where the overall process is chaotic and spontaneous, but after the launch, the approach should change to be more structured and precise. Financial management is an integral part of the overall management system for economic processes. It is aimed at improving the system of relations designed to normalize the financial resources necessary for business development.

Her miscalculation resulted in a situation where Zipcar needs to sacrifice its profitability or reputation, which could have been prevented. The goal of financial management is financial stability and financial independence manifested in the combination of the economic interests of the company and all team members.

I would ensure that as soon as the company was ready to launch, all important business processes are delegated to proper experts since it will be a highly challenging problem to do so after the launch. Thus, I would not overlook the fact that the financial management of Zipcar is not delegated to an expert, which would make me realize that the team needs David Bell or someone with similar expertise to take over the financial processes of business operations. A special place among the goals and objectives of enterprises in the field of financial management is the constant increase in the efficiency of the enterprise and the maximization of its profitability.

There is a fairly close relationship between maximizing the delegated responsibilities in the enterprise and its profits. At the same time, a significant role here belongs to the policy in the field of resource allocation in the priority of the development of the team over the focus on clients.


Afshari, J., Moein, Z., Afshari, F., Sharifi-Rad, J., Balouchi, A., & Afshari, A. (2017). A comparison of leadership styles with respect to biographical characteristics. SA Journal of Human Resource Management, 15, 1-7. Web.

Aga, D. A., Noorderhaven, N., & Vallejo, B. (2016). Transformational leadership and project success: The mediating role of team-building. International Journal of Project Management, 34(5), 806–818. Web.

Alrowwad, A., Abualoush, S. H., & Masa’deh, R. (2020). Innovation and intellectual capital as intermediary variables among transformational leadership, transactional leadership, and organizational performance. Journal of Management Development, 39(2), 196–222. Web.

Ancona, D., & Reavis, C. (2014). Robin Chase, Zipcar, and an inconvenient discovery. MITSloan Management.

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