Leadership is an open-minded approach intended at rationally stimulating the group dynamics. It is a practical skill allowing a leader to guide and lead the subordinates in the team for the accomplishment of a communal goal (Kantabutra, 2006). It is also defined as a process of social influencing of a group of individuals and enlisting the key goals that are to be attained. It incorporates supporting other team members and the accomplishment of a particular task. Leaders are known to set the direction of a team and for doing so, they make use of their management skills for guiding people in the right direction in an efficient custom. It is crafted in such a manner that the subordinates can understand, see, feel and embrace the same.
This summative essay is a critical evaluation of transformational and transactional leadership and its impact on workforce behaviour. This assessment will specifically focus on the differences between the two styles and their effectiveness. Furthermore, it will also play prominence on the role of a combined approach of both the leadership styles towards fostering change and positive workplace behaviour. The concluding section of the assessment highlights the key underpinnings of the overall evaluation. It brings a richer picture of the association between leadership and behaviour of the workforce.
According to the authors Bass (1990), transformational leaders are charismatic to their followers and ensure that the employees are inspired. They intellectually stimulate the employees and have great influencing power as compared to the transactional leaders. Employees tend to identify with them and have a high degree of confidence and interest in them. Workforce behaviour is basically the behaviour and attitude that employees practice within the workplace and is usually referred to as formal behaviour that employees are supposed to trail within the organisation. It is supposed that the employees must have a positive attitude towards their co-workers, their appearance and tasks. Henceforth, different leadership strategies are employed for enhancing workplace behaviour and aligning it with the organisational goals (Dvir, Eden, Avolio & Shamir, 2002).
The managers who behave according to the transformational leadership style are more likely to be witnessed by the employees as effective and satisfying leaders. It also boosts workplace behaviour and makes employees more engaging and committed towards the vision of the organisation. It is also known to contribute to enhanced employee retention and less turnover. Transformational leaders ensure that a clearer picture of the future is created so that the employees can align their personal goals with that of the organisation (Bass, Avolio, Jung & Berson, 2003). They link different expectations of the employees with good results and ensure that the vision is attained through the provision of incentives and attractive rewards. The rewards are provided both in extrinsic and intrinsic terms and frequent opportunities are crafted for engaging them.
Transactional leadership is grounded on the fact that the subordinates within a team must adhere to the guidance provided by the leaders in concern with the particular task. The term transaction is associated with the term payment of the team members for obedience on working on a particular task. Additionally, in this style, the leader can punish the members of the team if the work does not meet a predefined standard. Relationship between supervisor and employees vary from one organisation to another, most of the managers depend majorly on the legitimate power for managing the team members and engage in a transactional style with the team members (Den Hartog, Van Muijen & Koopman, 1997). There are two critical factors that exemplify modern leadership namely organising and initialising the work and concentrating on accomplishing of the tasks at hand, and depicting consideration for employees and focusing on satisfaction and self- interest for employees who outperform.
In this leadership, the performances and operations majorly rely upon exchange; which is rewarding good performance and punishing or imposing penalties for poor performances and it is used as a basis for characterizing this type of leadership. It is prescribed for mediocrity and is usually employed by the leaders who heavily rely on passive management by exception and intervening in the group procedures on the basis of standards for completing the tasks (Den Hartog, Van Muijen & Koopman, 1997). The transactional leaders may employ the transformational strategies at suitable moments and motivate the subordinates by depicting the vision and hence, pose a predictable impact on performance and behaviour of the workforce.
Organisations in which leaders follow transformational leadership, the motivation level of employees is comparatively higher in judgment to organisations in which transactional leadership is trailed. Employees also state that they themselves put extra efforts on behalf of the managers who follow the transformational leadership (Dvir, Eden, Avolio & Shamir, 2002). However, in the case of transactional leaders, the employees feel that they are passively managed by the leaders. Also, they state that in under transactional leadership, they put less effort for the leaders. Transactional leaders stress the role of organisation, group performance and supervision. They lay prominence on the status quo and progress achieved on a daily basis towards objectives. However, transformational leaders collaborate with their employees to enhance engagement and motivation and ensure that a shared vision is crafted towards the goal by impacting behaviour (Saravo, Netzel & Kiesewetter, 2017).
Transactional leadership is completely different from transformational leadership as it operates within the active limits of procedures, structures and goals whereas transformational leadership tests the present situation of the firm and is inclined towards bringing a positive change within the workplace. Unlike transformational leadership, transactional leadership fosters acquiescence according to the existing performance expectations and objectives of the organisations via punishments, rewards coupled with continuous supervision (Quigley, 1994). In contrary to this, transformational leadership focuses on enhancing the motivation of the employees by attempting to tie their self-sense with the values of the organisation. They emphasize by providing an example so that the followers can accurately predict the vision and values of the leader.
Transactional leaders are outcome-inclined and are disposed towards task completion whereas transformational leaders are change-oriented. Transformational leadership focuses on the weaknesses and plus points of the employees and improves the potential along with loyalty towards operations, decisions and goals, whereas transactional leadership adhere to employing a form of management which closely depicts consideration to how the employees complete their errands (Chui, Sharpe & McCormick, 1996). Transactional leaders work with the current and existing organisational culture whereas a transformational leader tries to cultivate new ideas thereby impacting the workforce behaviour to drive towards innovation. Transactional leaders plead to the self-interest of the subordinates trying to seek the rewards. However, transformational leaders appeal to the interests of the groups and concepts of triumph of an organisation. Transactional leaders comply with the common notions of management; however, the Transformational leaders are prone to influence the team members by going beyond the workplace and organisational traditional notions.
Contingency theory claims that there is no particular strategy or notion that fits in with the design and culture of different organisations (Otley, 2016). It is henceforth, essential that the leaders' effectiveness must be contingent upon the situation and the type of organisation. Therefore, it can be stated that leaders may exhibit and amalgamation and shifting degrees of both transformational leadership style and transactional style depending upon the situation (Taylor, 2017). Both transactional and transformational leadership styles are not reciprocally restricted and hence, the combination of both can be incorporated for depicting effective leadership.
Since leaders are accountable for the well being of the employees and productivity, they pose a significant impact on how the employees perceive tasks and behave with the workplace boundaries (Quigley, 1994). It is known to impact the performance of the employees in association with the goals. Combination of both the leadership styles can be effective as transformational leadership is a visionary one and can be incorporated for motivating the followers and going beyond the rewards and exchanges. At the same time, transactional leadership can maintain the required discipline in the workplace and ensure that the subordinates are made to focus on high performance and better acceptance towards the challenging tasks.
This assessment has maintained an extensive theme of comparison of transactional and transformational leadership style. Leadership is closely associated with creating and inspiring vision in an organisation and inspiring people to engage with the vision of the organisation and motivating them through the journey. They are accountable for managing the delivery of completion of the vision. Leaders also are responsible for building and maintaining the team. Effectual leaders create a vision and ensure that it is compelling enough for the subordinates to follow the vision. It is evident from the essay that transformational leaders are known to elevate the innovative work behaviour and also cultivate brio among the employees for further indulging in the social development whereas transactional leadership is supposed to push employees towards completion of the regular tasks for incentives and rewards rather than exploring the creative areas. Also, it is evident that a combination of both styles can be incorporated to boost productivity as well as maintain discipline.
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Bass, B. M., Avolio, B. J., Jung, D. I., & Berson, Y. (2003). Predicting unit performance by assessing transformational and transactional leadership. Journal of applied psychology, 88(2), 207.
Chui, H. S., Sharpe, F. G., & McCormick, J. (1996). Vision and leadership of principals in Hong Kong. Journal of Educational Administration.
Den Hartog, D. N., Van Muijen, J. J., & Koopman, P. L. (1997). Transactional versus transformational leadership: An analysis of the MLQ. Journal of occupational and organizational psychology, 70(1), 19-34.
Dvir, T., Eden, D., Avolio, B. J., & Shamir, B. (2002). Impact of transformational leadership on follower development and performance: A field experiment. Academy of management journal, 45(4), 735-744.
Kantabutra, S. (2006). Relating vision-based leadership to sustainable business performance: A Thai perspective. Kravis Leadership Institute Leadership Review, 6(3), 37-53.
Otley, D. (2016). The contingency theory of management accounting and control: 1980–2014. Management accounting research, 31, 45-62.
Quigley, J. V. (1994). Vision: How leaders develop it, share it, and sustain it. Business Horizons, 37(5), 37-42.
Saravo, B., Netzel, J., & Kiesewetter, J. (2017). The need for strong clinical leaders–Transformational and transactional leadership as a framework for resident leadership training. PLoS One, 12(8), e0183019.
Taylor, J. (2017). Management of Australian water utilities: The significance of transactional and transformational leadership. Australian Journal of Public Administration, 76(1), 18-32.
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