Leadership & General Management
| 8 minutes read | Last update: November 2021
4. Transactional leadership
Transactional leadership styles use “transactions” between a leader and his or her followers – rewards, punishments and other exchanges – to get the job done. The leader sets clear goals, and team members know how they’ll be rewarded for their compliance. This “give and take” leadership style is more concerned with following established routines and procedures in an efficient manner, than with making any transformational changes to an organization.
Advantages:
- Leaders create specific, measurable and time-bound goals that are achievable for employees.
- Employee motivation and productivity is increased.
- Transactional leadership eliminates or minimizes confusion in the chain of command.
- It creates a system that is easy to implement for leaders and easy to follow by employees.
- Employees can choose reward systems.
Disadvantages:
- Innovation & creativity is minimized.
- Empathy is not valued.
- Transactional leadership creates more followers than leaders among employees.
5. Transformational Leadership
In transformational leadership styles, the leader inspires his or her followers with a vision and then encourages and empowers them to achieve it. The leader also serves as a role model for the vision.
Advantages:
- It leads to a lower employee turnover rate.
- Transformational leadership places high value on corporate vision.
- High morale of employees is often experienced.
- It uses motivation and inspiration to gain the support of employees.
- It is not a coercive approach to leadership.
- It places high value on relationships.
Disadvantages:
- Leaders can deceive employees.
- Consistent motivation and constant feedback may be required.
- Tasks can’t be pushed through without the agreement of employees.
- Transformational leadership can sometimes lead to the deviation of protocols and regulations.