Transactional Leadership And The Leadership Style

The leader demonstrates to the followers loyalty, trust, respect and admiration, with these the qualities of the transformational leader, they tend to work harder than originally expected that tends to have a link between effort and reward. These outcomes occur because the transformational leader offers followers something more than just working for self-gain; they provide followers with an inspiring mission and vision and gives them an identity. They believe in the organizational culture they find and specific methods of performing tasks. Transactional leaders are effective in getting specific tasks completed by managing each portion individually. According to Maslow’s hierarchy of needs, transactional leaders focus on the lower levels of the hierarchy that is the very basic levels of need satisfaction. One way that transactional leadership focuses on lower level needs is by stressing specific task performance (Hargis et al, 2001). They are more concerned with processes rather than revolutionary ideas hence under their leadership change is least expected. Unlike them, transformational leaders end up changing existing organizational cultures by implementing new ideas.

These rewards come in the form of salary increment, bonus and recognition (Gill 2011). Employees who fail to perform well are punished (Bass 2008). Howell and Avolio (1993) study confirms that the contingent rewards leadership has a negative effect on follower’s performance (Gill 2011). Similarly, transactional leadership is based on a contingent reward and punishment system, it does not offer much in term of motivating and inspiring people (Bach and Ellis 2011).

Transformational leaders and transactional leaders differ from one another in the manner that they encourage and motivate those who follow them. Transactional leaders are defined as those who focus on monetary and tangible rewards as motivational tools for the daily operations (Marquis & Huston, 2015). Transactional leadership is associated with a clear organizational structure in which managers and subordinates understand their roles and know from whom to receive reward and feedback (Cherry, 2015). This type of leadership style focuses on motivation for the here and now to accomplish daily tasks at hand. This leadership does not focus on forward thinking or growth towards the future (Gellis, 2001).

Over the past twenty years, an abundant body of researches have been done to review transformational leadership and transactional leadership. Burn (1978) was the first person to introduce and conceptualize the concept of transformational leadership and transactional leadership. Bass (1985) based on Burn’s concept and deepen his notion with modifications, which stated that one of the best frameworks of leadership is transformational or transactional, but not opposing to each other. Followed by Bass and Avolio (1994), they provide the idea of these two leaderships and generalize them into the development of global economic world. Bass and Avolio (1997) also suggested that there was no need to view transformational and

5. Transactional leadership includes a deal between the leader and his/her followers. The workers are basically doing tasks for the organization, in order to receive some kind of benefits, money, etc.

Leaders need to recognize that certain motivators may not always be the best motivators. Considering that some motives may be complex, they are usually a result of some initiative that an individual may have brought about based on their personality or experience. One way to persuade followers or employees is to offer them financial incentives to increase output and profits. However, the consideration of financial incentives should also consider the leaders behavior on the employees which may have influenced the employees to increase output and profits. A transactional leader focuses on tasks and behaviors rather than relationships. Traits and behaviors influence effectiveness of the followers not necessarily the motivating factors associated with the task, such as financial (Derue, 2011). Values of the individual need to be considered when considering which motivators should be used.

Transactional leadership is built on reciprocity, the ways in which leaders and followers influence one another, and the idea that the relationship between leader and their followers develops from the exchange of some reward, such as performance rating’s, pay, recognition, or praise (Marturano, 2004). This style of leadership does not promote a close relationship amongst the boss

Transactional leadership styles are more concerned with maintaining the normal flow of operations. Transactional leadership is described as making contact with others for the

Transactional leadership on the other hand was first described in 1947 by Max Weber; he first coined "rational-legal leadership — the style that would come to be known as transactional leadership — as the exercise of control on the basis of knowledge” (Spahr, 2014). According to Spahr (2014), characteristics of transactional leaders include: focus on short-term goals, favor structured policies and procedures, thrive on rule following and doing things correctly, revel in efficiency, left-brained, inflexible, and opposed to change.

Devine and Winter (2012, p. 25) state, “there is nothing magical about leadership, and there is nothing magical about teaching it or learning it.” They go on to define leadership as the ability to influence those who work for you to want to accomplish and strive to reach organizational goals and objectives. Those who influence others must understand the theories of motivation so that these theories can be applied, communicated and taught in order to motivate followers (Devine and Winter, 2012). Different from supervision, leadership implores the desires of those around you to want to succeed in meeting a goal through you the leader’s motivational abilities.

“Transactional leadership is a style of leadership focused on contingent rewards of followers” (McGuire & Kennerly, 2006, p.180). Goals are set, directions are given, and rewards are used to reinforce employee behaviors associated with meeting or exceeding established goals. Followers are manipulated and controlled with rewards of praise and recognition, merit raises, and promotions, which can be given or withheld according to the employee’s performance. The outcome of such behavior is enhanced role clarity, job satisfaction and improved performance (McGuire & Kennerly, 2006).

Transactional leadership is defined by different components: contingent reward, management by exception, and laissez-faire leadership. These components help define, but are not always prominent. Contingent reward describes the transaction

 The transactional style of leadership is pretty straight forward but it uses rewards and punishments to motivate the team. This is a style of leadership that is similar but not as extreme as the autocratic style. The transactional styles are direct and dominant and spend a great amount of time saying what is expected from the team as a whole. The leaders monitor the work and each and everyone’s individual performance, there is also a clear chain of command.  Transactional leaders are very commonly found within businesses where people are given rewards such as bonuses, training or time off if they show a good demonstration.

Leaders are aiming to control and surveillance employees through sensible and thrifty intention (Bass, 1985). It simply requires an agreement between leaders and followers toward organization goal (Burns, 1978). In transformation leadership, leaders focus on changing followers’ moral sensibilities and potentially increasing their motivation beyond self-interest (Kezar & Eckel, 2008, p. 381). It needs more associated with outcome criteria than transactional leadership (Rowold & Rohmann, 2009, p. 42). Transformational leadership helps to build positive relationship among staff and raising their morale. In contrast, transactional leadership helps to build the fundamental structure of the organisation (Kezar & Eckel, 2008, p. 383).

Transactional and transformational leadership differ. Ingram (2016) states “Different managers employ distinctly different management styles, ranging from relatively hands-off, facilitative styles to autocratic, micromanaging styles. Managers can also employ different motivational strategies and techniques to boost employee performance or accomplish internal change. Transformational and transactional leadership are polar opposites when it comes to the underlying theories of management and motivation. Understanding the difference between transformational and transactional leadership is crucial for anyone pursuing a career in management.” (Ingram, 2016). When I was a manager, I had to make sure my store operated properly and maintain sales. Sometimes I would hold contest for my workers to motivate them, Ingram (2016) states “Transactional leadership styles are more concerned with maintaining the normal flow of operations. Transactional leadership can be described as "keeping the ship afloat." Transactional leaders