Transactional LeadershipTHE TRANSACTIONAL – TRANSFORMATIONAL LEADERSHIP

TYPOLOGY

AND TRAITS OF TRANSACTIONAL LEADERS

History of the Theory Max Weber first described Transactional-type leadership, calling it Legal-Rational authority

This is one of three sources of authority:1. Charismatic2. Traditional3. Legal-Rational (Transactional)

For Weber, Legal-Rational authority is the most stable, and therefore the most mature form

History of the Theory James MacGregor Burns, and later Bernard Bass, developed the Transactional vs Transformational leadership typology

MacGregor Burns defines leadership as:“Leaders inducing followers to act for certain goals that represent the values and the motivation—the wants and needs, the aspirations and expectations– of both followers and leaders” (Leadership, 1978)

The Transactional-Transformational typology focuses on the leader’s actions and the leader-follower interaction, rather than the internal processes of the leader

Transactional vs TransformationalThe two types of leadership differ based on the nature of the interaction between leaders and followers

Transactional: Initiative taken for purpose of exchanging valued things

Transformational: Leaders and followers engage to “raise one another to higher levels of motivation and morality”

Transactional Leadership Leader and followers pursue joint purpose

Leader takes initiative to make contact, with the purpose of mutually beneficial exchange

Examples:◦ Political: Logrolling votes in Congress; Politician exchanges promises for votes◦ Economic: Exchanging commodity for money; labor for a wage◦ Social: Teacher gives grade for coursework

However, there is no enduring purpose that binds the leader and follower together

Maslow’s Hierarchy of Needs

Transactional Leadership focuses on process rather than innovation◦ Focus is on reward and punishment◦ Transactional Leadership focuses on process rather than innovation

Transactional leaders focus on lower order needs to create motivation• Basic necessities and security to motivate

behavior, rather than higher purpose

Traits of Transactional Leaders Work within existing system (or organizational culture)

Focus on marginal improvements to follower performance

Use reward and punishment to incentivize follower behavior◦ Appeal to followers’ self-interest

More management than leadership◦ Process and task focused◦ Management by Exception: Punish deviation, reward task completion

Benefits of Transactional Leadership

Responsive (rather than proactive)

Effective in crises, well-defined hierarchies, and simple/defined problems

Transactional leadership is good for maintaining status quo

Transactional vs Transformational

Transactional: Responsive Within system/culture Impersonal Appeal to lower-order needs

Transformational: Proactive Transcendent/Innovative Appeal to higher purposes

Relation to Other Leadership Theories

Focused on behaviors and actions of leaders, rather than traits

Transactional leadership employs the known responses to reward and punishment, as documented by B.F. Skinner and others

Transactional leadership is closest to task-oriented leadership and “telling” (Fielder 1967; Hersey and Blanchard (1976)

While Burns and Bass see Transformational leadership as superior, the relative merits depend on the situation (Contingency)

SourcesBass, Bernard. “From Transactional to Transformational: Learning to Share the Vision.” Organizational Dynamics 18:3 (Winter 1990): Pages 19-31

Bass, Bernard, and Ralph Melvin Stogdill. Bass & Stogdill's Handbook of Leadership: Theory, Research, and Managerial Applications. New York: The Free Press, 1990.

Kuhnert, Karl W., and Philip Lewis. "Transactional and Transformational Leadership: A Constructive/Developmental Analysis." Academy of Management Review 12.4 (1987): 648-657.

MacGregor Burns, James. “Transactional and Transforming Leadership.” from Leadership. HarperCollins Publishers, Inc., 1978.

Odumeru, James A. and Ifeanyi George Ogbonna “Transformational vs. Transactional Leadership Theories: Evidence in Literature," International Review of Management and Business Research 2:2 (2013).