Skip to main content

How a Transactional Leadership Style Works

Introduction

Transactional leadership, also identified as management leadership, emphases on the role of command, organization, and group performance. Leaders who implement this style focus on specific tasks and use rewards and penalties to encourage followers (Xenikou, 2017).This theory of leadership was first described in by sociologist Max Weber and further explored by Bernard M. Bass in the early 1980s. Take a closer look at how the transactional style works as well as some of the potential benefits and shortcomings of this style.

 Basic Norms of Transactional Leadership

  • People achieve their greatest when the chain of command is confident and clear.
  • Rewards and penalties encourage employees.
  • Following the instructions and commands of the leader are the key goal of the followers.
  • Subordinates need to be carefully monitored to ensure that expectations are met (Sultana, et al., 2015).

This theory takes a behavioural approach to leadership by basing it on a system of rewards and punishments.

Transactional leadership is frequently used in business; when employees are successful, they are rewarded; when they fail, they are castigated or punished. Athletic teams also trust deeply on transactional leadership. Players are expected to adapt to the team’s rules and prospects and are rewarded or punished based on their performance. Winning a game might mean accolades and bonuses while losing might lead to elimination and verbal ticking-off. Players frequently become highly motivated to do well, even if it means woe pain and wound.

Unlike transformational leaders who tend to be progressive, transactional leaders are interested in simply maintaining the status quo  (Xenikou, 2017). Transformational leaders try to sell their ideas and vision to followers. Transactional leaders, on the other hand, tell group members what to do and when to do it.

How Transactional Leadership Works

In transactional leadership, rewards and penalties are depending upon the performance of the followers. The leader views the relationship between managers and subordinates as an altercation – you give me something for something in return. When subordinates perform well, they receive a reward. When they perform poorly, they will be punished in some way. Directions, processes, and values are necessary for transactional leadership. Transactional leaders monitor followers carefully to implement rules, reward success, and punish failure. They do not, however, act as promoters for growth and change within an organization. Instead, they are focused on maintaining this as they are and applying current rules and expectations. These leaders do tend to be good at setting hopes and values that exploit the efficiency and productivity of an organization (St. Thomas University, 2018). They tend to give constructive feedback regarding follower performance that allows group members to improve their output to obtain better feedback and reinforcement.

When Is Transactional Leadership the Most Effective?

Followers are not encouraged to be creative or to find new solutions to problems. Research has found that transactional leadership tends to be most effective in situations where problems are simple and clearly defined (Wongyanon, et al., 2015). It can also work well in crisis situations where the focus needs to be on accomplishing certain tasks. By assigning clearly defined duties to particular individuals, leaders can ensure that those things get done.

In times of crisis, transactional leaders can help maintain the status quo and “keep the ship afloat,” so to speak. Transactional leaders focus on the maintenance of the structure of the group  (St. Thomas University, 2018). They are tasked with letting group members know exactly what is expected, articulating the rewards of performing tasks well, explaining the consequences of failure, and offering feedback designed to keep workers on task. While transactional leadership can be useful in some situations, it is considered insufficient in many cases and may prevent both leaders and followers from achieving their full potential. 

Conclusion

The effects of the study specify that transactional style positively power organizational performance. It exposed that the leadership style has an effect on organization effectiveness via people perception. Therefore, a new finding for leadership in local organization encouraged other realistic findings in leadership term. The current situation around the local organization is regularly changed through globalization. Adapting the transactional leadership style, the subject on the situation will be a core feature in organizations of the future and a hope of staff.

References

St. Thomas University, 2018. STU Online. [Online]

Available at: https://online.stu.edu/articles/education/what-is-transactional-leadership.aspx

[Accessed 16 June 2020]. 

Sultana, U. S., Darun, M. R. & Yao, L., 2015. TRANSACTIONAL OR TRANSFORMATIONAL LEADERSHIP: WHICH WORKS BEST FOR NOW?. International Journal of Industrial Management (IJIM), XX(1), pp. 1-8. 

Wongyanon, S., Wijaya, A. F., Mardiyono & Soeaidy, M. S., 2015. Analysis of the Influence of Leadership Styles of Chief Executives to Organizational Performance of Local Organization in Thailand (A Case Study of Transformational, Transactional and Laissez-Faire Styles of Leadership in Pattaya City, Laemchabang City Mu. International Journal of Applied Sociology, 5(2), pp. 76-83.

 Xenikou, A., 2017. PobMed.gov. [Online]

Available at: https://pubmed.ncbi.nlm.nih.gov/29093688/

[Accessed 15 June 2020].


Comments

  1. ShanthawijesingheJune 21, 2020 at 5:27 AM

    In transactional leadership ,the role of command ,organization and group performances are emphasized .It can be more effective where problems are simple and clearly defined.More ideas have given on the topic

    ReplyDelete

Post a Comment

Popular posts from this blog

Strategic Management an Overview

Introduction The function of coordinating the efforts of people to achieve goals and objectives through efficient and effective use of resources is known as management. Management involves planning, organizing, staffing, leading and controlling to accomplish desired aims. Resourcing includes manipulation of human resources, financial resources, technological resources and natural resources. All the resources are limited in nature. Strategy is very important for an organization due to the limitation of resources. Strategy The word strategy has so many meanings itself and all these meanings are useful, important and relevant to the people who are setting strategy for their organizations and corporations. Various authors have drawn their attention to the concept of strategy. The word strategy derives from the Greek word “strategos”, the meaning comes from the roots of “army”. The meaning of strategy is the planning of destroying enemies by effectively using the resources. Therefore the co...
Post a Comment
Read more
Effective Leadership for New Age Organizations Introduction Leadership is a significant aspect of management. In order to ensure organizational success, co-operation from subordinates as well as greater efficiency, it is important for a manager to be a great, effective and a true leader. An effective and true leader is one who does not put himself before others. He is very modest, deferential and noble. Leadership “Leadership is an influence process that enable managers to get their people to do willingly what must be done, do well what ought to be done”, (Cribbin, 1982). Components of Effective Leadership According to experts, there are two very important components of effective leadership. One is belief and confidence in leadership, which is an indicator of employee satisfaction in the organization. The second is effective communication by the leadership in making the employees understand the business strategy, helping them understand and contribute to the ac...
6 comments
Read more

The qualities of transformational leaders and what distinguishes them from transactional leaders

Customized Thought Customized Thought is the extent to which a leader attends to each follower’s needs and is a guru, teach or guide to the follower. This leader attends to the concerns and needs of each follower and delivers support and is empathic of each person’ situation and background. When a leader displays customized thought they are also responsive to the sole aptitudes that each follower brings to the workplace and support them in emerging and indicating these key skills and behaviours. This leads the follower to aspire to develop further and they show core motivation when performing their work. Inspirational Motivation Inspirational Motivation is the degree to which a leader articulates an appealing vision that inspires and motivates others to perform beyond expectations. Leaders who use inspirational motivation have high standards and expectation for their followers.  They are optimistic about follower ability to meet goals and they always provide meaning to their foll...
Post a Comment
Read more