Transformational and transactional leadership are considered polar leadership styles with regards to management theories and motivation. Transformational leadership describes a leadership style whereby the organizational leader formulates new strategies to improve the overall performance of the organization, as suggested by Cho et al. (2019). Transactional leadership, on the other hand, is a leadership style whereby a leader focuses on maintenance of the organization's normal operations. Whereas transformational leaders are natural leaders who use their enthusiasm to influence and motivate their followers, transactional leaders use disciplinary power and rewards as the basis for motivating junior and subordinate staff. In most cases, transformational leadership strives to change and revolutionize existing operations and conditions within the organizations, although transactional leaders only focus on maintaining day-to-day operations and conditions. Moreover, transformational leadership is charismatic and provocative, whereby the leader uses his compelling personality to influence change and performance of the organization's staff. On the contrary, transactional leadership is more or less bureaucratic and responsive; thus, supervision and management of staff are rule-bound, and the leaders only react to changes implemented by executives.
According to Jensen et al. (2019), transactional leadership can be used in settled environments to facilitate the planning and execution of tasks within an organization, but transformational leadership is usually applicable in turbulent environments to promote creativity and innovation. Typically, transactional leaders use an array of rewards and incentive to stimulate their followers' performance. In other cases, they use punishment to keep employees on the right track in a bid to actualize the organization’s mission, vision, and defined objectives. Transformational leaders inspire their followers to implement creative and innovative strategies in crises to help the organization to recover and realize its long-term goals. Transactional leadership, on the other hand, is used in dynamic steady state situations where there is a balance in both the microenvironment and macroenvironment. In such cases, the leaders implement existing strategies to maintain working conditions within the organization. In situations where a firm wants to increase its profit margin and competitiveness, transformation leadership styles can be applied to stimulate change in operations and initiate effective strategies towards these goals. However, transactional leadership is used in situations where an organization wants to maintain its existing policies and corporate culture.
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The modern workplace is continuously evolving to keep up with new trends in management, technology, and operations. Therefore, the modern workplace requires a leadership style that facilitates change. Transformational leadership is the best leadership style since it is pragmatic and promotes systemic changes in the contemporary workplace. Unlike transactional leaders, transformational leaders design and communicate new strategies meant to improve working conditions within the workplace (Cho et al., 2019). They also provide their subordinates with opportunities for professional and personal growth by inspiring the employees to apply their creative skills in the execution of operations within the organization. Furthermore, transformational leaders motivate employees to transcend their self-interests in accomplishing both long-term and short-term objectives. These leaders act as role models for their followers to inspire the employees and elevate their interests in achieving their individual goals in the organization. More importantly, transformational leadership helps managers and executives to align the organization's staff with operations to increase their output and overall performance. This leadership style also establishes a relationship of mutual elevation and stimulation in the modern workplace, which transforms leaders into morals agents and transforms followers into leaders.
References
Cho, Y., Shin, M., Billing, T. K., & Bhagat, R. S. (2019). Transformational leadership, transactional leadership, and effective organizational commitment: a closer look at their relationships in two distinct national contexts. Asian Business & Management , 1-24.
Jensen, U. T., Andersen, L. B., Bro, L. L., Bøllingtoft, A., Eriksen, T. L. M., Holten, A. L., ... & Westergård-Nielsen, N. (2019). Conceptualizing and measuring transformational and transactional leadership. Administration & Society , 51 (1), 3-33.
