Transactional leadership vs Transformational leadership

Let’s think about it for a while, Are you a transactional or transformational leader?

What leadership means?

Leadership is a process of influencing people to work willingly for the organization and a leader is a person who inspires rules or guides other people to work willingly for him/her for the common goal.

There are many theories about what makes the leader which is arguable and controversial in nature. For instance, trait theory states that “leaders are by born” and specific traits/characteristics make the person a leader.

While contingent theories state that “circumstances make the leader”, etc. There are numerous factors that make the leaders and on which the attainment of the leaders depend.

By keeping all these interpretations in view we cannot say that the leaders’ achievement relies only on the demographics qualities (i.e. education, gender, height, race, culture) because a person can be a good leader without having these demographics characteristics. These factors can participate in the triumph of the leaders but are not the sole qualities.

Researchers argue that the value of leadership relies on balancing leadership conducts with the requirements of supporters and the circumstances. The approach of a leader to influence people also changes with the change in a given situation.

This may be more successfully got through shared and democratic leadership instead of assuming a sole person to be capable to show all aspects of leadership.

Some other qualities that leaders require to succeed are described in the following:

  • The capability to recognize and realize moods, sentiments, and drives, in addition to their effect on others
  • The potential to control or redirect trouble making impulses and moods
  • The propensity to defer judgment to think before acting
  • An enthusiasm to work for causes that go beyond money or status
  • A propensity to follow objectives with energy and perseverance
  • The capability to realize the sentiment makeup of other people
  • Skill in treating people according to their emotional/feelings reactions

There are a lot of ways to lead a company, but most leadership styles are likely to be either transactional or transformational. Here, we explore the difference between transactional and transformational leadership

What is transactional leadership?

In 1947, this leadership style was first proposed by Max Weber followed by Bernard Bass in the year 1981. This leadership style goals are predefined and the leader uses reward and punishment to inspire his group is known as Transactional Leadership.

It focuses on boosting the current situation of the organization by framing good rules and regulations. In this leadership style, the leader uses his power and responsibility. Rewards and penalties are the two primary tools used by the leader to inspire his subordinates

For instance, if an employee achieves the target within the stipulated time frame he is given appreciation for his work, whereas if the task is not completed within the required time, then he will be penalized for the same.

What is transformational leadership?

James MacGregor first proposed this concept of leadership style in the year 1978. The main concept of this leadership style is that both the superior and subordinate work for improving their morale and motivation.

The style of leadership in which the leader uses his influencing power and eagerness to motivate his followers is to work for the benefit of the organization.

Here, the leader seeks the requirement for a change in the existing organization culture, gives a vision to his subordinates, incorporates mission, and implement the change with the commitment of his followers.

In transformational leadership, the leader acts as a role model towards the followers. The leader inspires his people to increase their abilities and capabilities, erect self-confidence, and promotes innovation in the whole organization.

Difference between Transactional and Transformational leadership


Transactional leadership

Transformational leadership

1 Rewards and punishment are used towards the followers. The leader uses his charisma and enthusiasm to influence his followers.
2 Puts mental stress on followers. Lays stress on the values, beliefs, and needs of his followers.
3 Best for a settled environment. Good for a turbulent environment.
4 Focused on planning and execution. Promotes innovation.

Related post : All about Charismatic Leadership 

Leadership Theories

Contingency Theory of Leadership

Leave a Reply

Your email address will not be published. Required fields are marked *