Transformational Leadership vs. Transactional Leadership

Leadership Models in Modern Organizational Landscape

Leadership Models Available in the Modern Organizational Landscape

How cultural style dictates the perception of what is ethical in a leader's use of power, influence, and authority

There are clear variations between cultures, especially in terms of behavior, attitudes, and values of individuals. The divergence affects the leadership model adopted by various organizations. Many studies have also shown that different leader behaviors and activities are understood and interpreted in a different way based on their cultural environment. As such, they are caused by differences in the ideas of an ethical leader: some styles are preferred, and others recognized as less effective. These differences exist because the significance and importance given to the concept of leadership appears to differ across cultures. With globalization and the development of organizations across national boundaries, numerous opportunities and challenges are available for leadership. Varying cultural values and beliefs calls for the greater understanding and recognition of culturally linked leadership styles. Responsiveness towards cultural sensitivities that may be drastically different from someone's own beliefs, and values is crucial for leadership efficiency (Marturano & Gosling, 2008).

Leadership styles typically developed in individual cultures signify effective leadership as an action of generating greater and better financial results. Success is always a factor of a leader's behavior in ensuring that employees perform optimally at the workplace. These styles are drawn in forms of self-interest such as networking, mentoring, and other personal initiatives that succeed in individual cultures. However, it is expected that leaders in collectivist cultures will view leadership efficiency as a long-term goal because of subordinate dedication, extra effort, and fulfillment with the leader. Furthermore, collectivist cultures prioritize the needs of the team, family and the community when engaging in leadership behaviors. Therefore, principles of mutual responsibilities require leaders to give supporters direction and protection in exchange for commitment and loyalty.

Similarly, leadership styles typically suggest a democratic view of getting leadership roles, claiming, "Anyone can get to the top." However, this concept draws from an individual viewpoint in accordance with the cultural aspect of low power distance. Small power distance societies believe that roles and obligations can be changed depending on individual effort and accomplishment and that someone whom today is my subordinate, the next day could be a superior. However, in high-power distance societies, titles, social status, and positions are well-known because they determine the way others treat and behave. Thus, leaders and their employees consider each other as unequal (Marturano & Gosling, 2008). Therefore, it is expected that leadership styles in high-power distance societies will seek to show respect for age, tolerance, compromise, and agreement while creating rules for togetherness among all stakeholders.

Leadership models, styles, and traits are most commonly accepted as ethical across the greatest array of social cultures.

Transactional and transformational leadership styles are worldwide concepts. Global Leadership and Organizational Behavioral Effectiveness (GLOBE) study have found both global transformational features of ideal leadership and ones showing cultural uniqueness within and between the suggested two styles. House et al. (1999) applied the idea of culturally recommended implicit leadership concepts to list the leadership attributes and behaviors, which are "universally" recommended as leading to effective leadership, and the extent to which behaviors and attributes are linked to cultural features. Universal leadership dimensions were used to create the profile for universally accepted social clusters like gentle oriented, charismatic or value-based, independent, and self-protective.

The charismatic/value based approach contains the most number of features globally recognized as contributors to successful leadership, but the charismatic dimension, partly risk-taking is not globally accepted. The Southern Western countries, such as Russian, recommended inspirational charisma and visionary, reliability, decisiveness, performance alignment, group integrator, competent, diplomatic, team oriented as the key excellent leadership traits. The recommended components of successful leadership consist of transformational/charismatic and team-oriented leadership. The most widely accepted leaders are decisive, inspirational, and visionary. Participative leadership has substituted paternalistic leadership that was traditionally seen in Southern Western countries. Leaders with integrity are able to act collaboratively and build highly respectable teams (Marturano & Gosling, 2008).

There has been a perception that transactional and transformational styles will have a worldwide acceptance because these models can be tailored to suit different cultural environments. Some management authors suggest that transformational model encourage greater contribution within collectivist societies. Perhaps, subordinates are more likely to accept and identify their leader's philosophy because of the high-power distance and approval for authority.

A particular leadership model as a tool for shaping organizational culture

Leadership is the least recognized, but most observed phenomena on this planet. Although leadership was a natural capability to influence others through behavior change within teams, leadership designs have progressed and stretched beyond influence. They consist of inspiration that allows others to help accomplish business objectives.

In modern research, focus is on a discovery of the behaviors that represent effective leadership. This viewpoint supports the appearance of transformational leadership and transactional leadership across the world. Researchers designed an extensive concept to describe the variations between the behaviors of government leaders by using the terms "transactional" and "transformational." They considered transactional leaders as people who insist on work standards, and are task-oriented is goals, while transactional leaders execute their leadership within the organizational restrictions and follow the current guidelines. They seek to ensure that all the common organizational projects are finished on time. Control, authority, and power are based in this behavior because disciplining or rewarding employees in the design of transaction obtain business objectives. The implied understanding was of a task requiring to be performed, and compensation would be forthcoming when completed satisfactorily. The reward-based actions are designed to enhance employee performance (Kezar, 2011).

A transactional model utilizes a transaction between leaders and employees, who are then compensated or disciplined based on work performance. Autocratic design and agentic traits in which control and power are important are often utilized by leaders. They recognize employees' strong points and establish agreements describing the incentives, rewards, and desired results when projects are finished. However, transformational design consists of behaviors with reliable public traits. Features like teamwork flexibility, development of employee capabilities, and assisting others to accomplish the set objectives are encouraged. These features are crucial for a genuine transformational leader because they help in acquiring the dedication and efficiency of organizational members (Johansson & Begley, 2013).