Gradient-dependent plasticity where a characteristic length is involved to consider the microstructural effect (interactions and interplaying among microstructures due to the heterogeneous texture) is introduced into Johnson-Cook model considering the effects of strain-hardening, thermal softening and strain rate sensitivity. Effects of initial static yield stress, strain-hardening coefficient and exponent, strain-rate and thermal-softening parameters on the occurrence of phase transformation and the thickness of phase transformed adiabatic shear band (ASB) in deformed ASB are numerically investigated. Higher initial static yield stress, strain-hardening coefficient, strain-rate parameter and lower strain-hardening exponent lead to earlier occurrence of phase transformation (lower plastic shear strain). Effect of thermal-softening parameter on plastic shear strain corresponding to the onset of phase transformation is not monotonous. Transformed ASB is located at the center of deformed ASB since the position has higher temperature exceeding the temperature of phase transformation. The thickness of transformed ASB increases with decreasing flow shear stress and the increasing tendency becomes slow. For the same flow shear stress, the thickness of transformed ASB is wider for higher initial static yield stress, strain-hardening coefficient and exponent, strain-rate and thermal-softening parameters. Compared with classical elastoplastic theory applicable to completely homogenous material, gradient-dependent plasticity considering the microstructural effect predicts that phase transformation occurs earlier and that the thickness of transformed ASB changes with flow shear stress.