One of the most important challenges facing the reality and future of the global markets is that the capabilities of graduates do not align with the rapid changes witnessed in the world. Unfortunately, high educational institutions are unable to play their role in bridging the gap between the requirements of the changing global market and the qualifications and efficiency of graduates. Thus, this paper aims to investigate the reason for the weak capabilities of graduates of higher education institutions to keep align with the labor market, and to attempt to bridge this gap by studying the impact of practicing the theory of transformational leadership on the level of performance of employees in higher education institutions. This research paper presents a new concept for raising the readiness of graduates, linking the theory of transformational leadership with the elements of professional success for graduates of higher education institutions. The paper presented the different theories of leadership, the most important of which is transformational leadership. It also discussed the research literature that studied the impact of transformational leadership theory on the performance of employees in higher education institutions, as well as the literature that studied the poor readiness of graduates for the labor market. The paper provides a new model for understanding the reasons that stand behind graduates’ inadequate preparedness for the labor market. The proposed conceptual model considered the components of the transformational leadership theory and linked them to the triangle of graduates’ career. This model addresses the challenges facing employers, the local and global market, and the increasing demand for high-performance human resources.