Two Styles of Leadership: Transactional and Transformational

Task 3

Compare and Contrast

Two styles of leadership: Transactional and Transformational

Student: Yuhan

Date: 19/05/2013

Transactional and transformational leadership are the two modern modes of leadership in the management literature. Although transformational leadership is built on transactional leadership, they certainly have dissimilarities.

Transactional leaders use social exchanges to guide or motivate followers to complete their individual tasks. Employees work towards established goals by exchanging rewards for their performance (Robbins et al. 2012). Transactional leadership’s primary goal is to facilitate stability in the organization by using a give-and-take type of exchange between managers and followers. Specific objectives are determined to employees. Then employees can either receive a reward or punishment depending on how they do their work. The term "transactional" shows the fact that this type of leader motivates followers by exchanging rewards for productivity. The relationship between leaders and followers of this type of leadership tends to be focused on the successful completion of short-term tasks. For example, an employee works as what the manager wants him to do to get paid to maintain a certain standard of living.

Like transactional leadership, transformational leaders also stimulate subordinates to work. However, transformational leaders guide followers to work towards a common objective, rather than fulfill the individual goals. They tend to make more use of employees’ individual strengths and talents. Transformational leaders set goals and incentives to push employees to higher performance levels, and they provide opportunities for each employee a better chance to grow and develop. In contrast to transactional leadership, transformational leadership may suits long-term task more in the organization.

To sum up, both of the two leaderships motivate employees to complete work. Transactional leaders exchange rewards for...