How Leadership Affects Change

Transformational and Transactional Leadership

By Abel Garza 09/23/2019

In business, we find that change is inevitable. Change is the evolution of which companies continue to compete, succeed and perform at peak performance. Is all change good or do we just embrace the idea that we should transform regardless of need?  In theory, flexibility and good leadership practices lean toward a successful transition. A seasoned leader may find a path forward by practicing certain skills favorable to change. Inevitably, we see leaders practice transactional and or transformational leadership when necessary. Business is a turbulent environment that requires leadership legerdemain. This co-existence of transactional and transformational characteristics is a continual process based on organization and vision.

Transactional Leadership

The concept of transactional leadership is not new (Burns, 1978). The concept was mentioned in 1981 by Bernard Bass on the principle that it coincides primarily with managers views (Bass, 2008). The transactional concept focuses on organizational goals and the connection to effort and reward. These responsive characteristics hone in on personal and basic human needs by appealing to the follower’s self-interests (Maslow, 2014). Rewards and punishment are contingent on performance. In exchange for the transactional leader’s performance objectives, the follower may concede that a job well done will be rewarded. This contract between leader and follower will be honored extrinsically.  The transactional leader will actively or passively manage and monitor progress according to standards while taking corrective action when necessary to obviate errors. It is often assumed that this form of leadership is consistent with unmotivated employees that are walking the preverbal line only to maintain their existence in an environment of supervisors micromanaging every process. The transactional leader may focus on short term goals, standard rules, and procedures that often create a circumscribed approach that minimizes the creativity and generation of innovative ideas (P C Tripathi, 2006, p. 112). Transactional leadership can be perceived in many ways, the autocrat, stickler, goal setter or the one that shouts bonus.

The Autocrat

The military has been using many styles of leadership throughout its existence. Autocratic leadership in the military can be easily associated with the idea of: I give the orders and you follow through or I know the mission and what the organizational goals are so while I’m in charge this is how it’s going to be. In return, the follower will gain necessary experience or the adoration of his superiors (Bieda, 1978).  With most military organizations, the leader will focus on managing the performance of individuals and the performance in a structured environment (Spahr, 2016). If you consider the analogy of military in Garrison over a deployment location; one may be more inclined to function under a transactional style of leadership whereas during a wartime situation requires leaders at all levels. No one person has successfully managed people into war, they must be led (Kotter, 2001).

The Box Approach

Transactional leaders will reward followers with basic human needs. This tacit agreement between leaders and followers lends itself to the necessary goals and measurable standards of which to abide and in doing so are rewarded or punished. Understanding the needs of what followers want can help leaders reinforce subordinates for successful completion of processes. Many CEOs that utilize the Box Approach have an understanding that value comes from communicating the goals of the organization in a clear and concise manner that will allow for controls i.e. financial, culture, or both to ensure that uniformity and predictability become a standard behavior. Leaders of the Box Approach subscribe to the idea that policies and procedures are developed to reinforce desired behaviors (Farkas & Wetlaufer, 1996).

The Goal Setter

The necessary steps to accomplish a task or move toward the vision of an organization is not always clear. A simple request to establish a budget or increase customer satisfaction may not be as straight forward as one might think. This usually raises more questions than answers. People are good at many things, but reading minds is not one of them. The goal setter is meticulously establishing short term goals that include the necessary steps to accomplish that goal from their team. Where do we get data, why do we need to coordinate, which managers will be involved, when will this happen or who will take control of each project? The goal setter will be creating goals that teams will be able to accomplish and not figure out for themselves. They will not leave it to chance and will spell out the specific details for what needs to get done, systemically. The goal setter will not be vague. Often goals will be met with omitted details, but planning is essential in creating an explicit and motivational link that will evoke the desired behavior to produce (Halvorson, 2014).

The Quid Pro Quo

What motivates? Motivation is personal and is individualized. What motivates one may not motivate another. People wake up in the morning and have a passion for something in their lives that usually gives them the fuel they need to start their day.  When asked what drives you, is the answer obvious? Many would jump to the idea that money is the primary motivator and that people would have fewer problems if they just had a lot of it. Leaders will find a balance of what motivates and allow people to fulfill those extrinsic needs through by way of reward.

Transformational Leadership

The Transformational leader is a formula for change and synonymous with the charismatic leader. The nomenclature alone connotes change. This connotation has some thinking that this is the most effective form of leadership for change. Leaders who are considered transformational arouse emotion in their followers which in turn motivates followers to move passed the preverbal circumscriptions of manuals and standard operating procedures. They enlist people in their ideas and provide the framework to think outside the box, to be proactive and distinguish themselves as moving past organizational goals and beyond self-interest (Nikezic, 2010). James M. Burn was first to introduce the transformational connection between leader and follower. James Burns and Bernard Bass define transformational leadership as someone who evokes commitment toward an organizational goal with the sole intention of transforming the central mission. Transformational leadership has evolved toward the exploration of characteristics that move beyond the standard and emphasize individual consideration, intellectual stimulation, charisma, and vision, (Burns, 1978; Bass, 2008)

The Mentor

Transformational leaders are showing individual consideration when spending time with followers: teaching and coaching. The result is the promotion of self-development. When leaders begin to treat people as individuals rather than group members; it elicits desire and aspirations (Atwater & Yammarino, 1993). The mentor can change their environment to promote growth and productivity. What the mentor must take into consideration are the many personalities they sometimes face. Provided that the mentor can recognize subtle signs in personality, the focus can be to address each with a unique approach (F.R., 2014).

“Successful people are always looking for opportunities to help others. Unsuccessful people are always asking, what’s in it for me” (Tracy, 2012)?

The Innovator

When asked to deliver the ideal leader, many would argue that traits such as intelligence, emotional stability, self-confidence, resolve and vision all come standard. While intellectual ability is directly correlated with leadership, practical intelligence or coping styles conducive to promoting effective social and work relationships seem to be a concept relevant to leadership. Although some have taken steps toward focusing on the analytical and technical skills of a leader, the minimum requirement for success only needs emotional intelligence as the key characteristic to differentiate an outstanding performer from the norm (Goleman, 2004). Driving results in business is a continued research process. The innovator is looking to advance their cause by using the latest and greatest information, technology or process.

The Magic

Charisma by definition is the magic, the Je Ne Sais Quoi of personality traits that form an unspoken understanding between leader and follower (Merriam-Webster, 2017). The charismatic leader will arouse loyalty and enthusiasm that enlists people through conviction and commitment to their cause. Charismatic leaders are committed to their cause and project their transformational style to make what would be considered ordinary into extraordinary. The magic happens when the charismatic leader dedicates their cause to positive change. Charisma is considered to be an inveterate trait with most natural leaders and a necessary characteristic for many leadership roles. Recognized by many as the most sought after trait, it is often imitated and rarely duplicated. It is either something you have or something you don’t. Many people argue that this is a behavioral type of character and can be learned, but others maintain you are born with it (Spahr, Charismatic Leadership, 2016).

The Visionary

Effective leadership will evoke change. When a leader inspires, movement follows. Inspiration promotes a synergy toward service for something greater than self. Inspiration involves a continued understanding of shared meaning and challenges for those followers (Nikezic, 2010).


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