Leadership Models: Transactional, Transformational, and More

Introduction: Leadership and Human Social Evolution

Man, like all other primates, evolved as a social creature for whom communal living and mutual cooperation within the human community is more natural—and preferable for the individual—than solitary existence. According to generally accepted evolutionary theorists, it is human societal living that is responsible for the gradual development of larger and larger brains and the simultaneous evolution of conceptual thought, advanced communication, and spoken language, rather than the other way around (Edey & Johanson, 1989).

Mutual cooperation within human societies is, necessarily, task and goal oriented, because cooperation and shared effort yield results more productively than exclusive self-responsibility for every individual need. Throughout most of human existence—particularly before the Industrial Revolution—the vast majority of human cooperation was motivated primarily by the simple desire of the individual to meet the basic needs of self and family. Living in a group, even under the oppressive wielding of authority, allowed many individuals to achieve more for themselves than would have been possible without reliance on others.

This observation of human social societies remains just as applicable today, except that the specific role of most individuals is far more removed from the most basic needs. Whereas in agrarian societies the relationship between the group and the product of cooperation is readily evident, in industrialized societies individual reward is based on currency exchange rather than the direct trading of products and bartering of services. As the productive role of the individual within society becomes more removed from reward, and the vocational functions of individuals become more compartmentalized, leadership becomes more important in human achievement.

The nature of leadership spans a wide spectrum, with autocracies and dictatorships on one end and absolute autonomy (or laissez-faire) on the other. Between these polar extremes of servitude through oppression and complete autonomy, several leadership styles have evolved that emphasize different aspects of human motivation and achievement in different proportions. Certain leadership approaches are most appropriate and likely to produce efficient results in some situations, while others are more likely to contribute to the success of group enterprise in different contexts. Some human enterprises can be effectively administered through more than one leadership approach, while other types necessitate one particular approach. In either case, one of the most important functions of leaders is to implement their authority and control in a manner most conducive to successful results.

Transactional Leadership

Transactional leadership refers, generally, to a focus on the specific performance of the individual as a condition for securing a desired reward (Bass & Steidlmeier, 1999).

In many respects, transactional leadership is the most natural style for human societies, because it represents the closest parallel to the relationship of the individual to the natural world: in nature, hard work and persistence are more likely to yield the desired results of directed effort than less conscientious effort. Likewise, transactional leadership is readily adaptable to industrialized society, in which the compartmentalization of individual effort is rewarded by salary increases and other specific representational benefits.

Transactional leadership is results oriented—and more specifically, it is results oriented with respect to particular levels of achievement or the successful completion of a particular task, project, or short-term goal. Transactional leadership may focus exclusively on positive reward, avoidance of negative consequences, or a combination of both. Generally, successful achievement is positively rewarded directly through increased compensation and other tangible benefits, or indirectly through promotion or organizational privileges.

Transactional leaders may also motivate performance by imposing negative consequences that can be avoided only through satisfactory performance. Except in autocracies and dictatorships, motivation driven exclusively by the avoidance of negative consequences is less likely to be efficient and successful over the long term—particularly in a vocational environment where similar work exists elsewhere and where effort and achievement are rewarded positively. In modern business, transactional leaders recognize performance and achievement positively in the form of improved compensation packages or advancement in position, and punish—or disincentivize—poor performance by withholding increased compensation and delaying positional advancement.

In many respects, transactional leadership is a hybrid device positioned between leadership and personnel management (Bass, 1985), because, in addition to providing direct oversight and motivation, it functions by administering major elements of the compensation-for-performance relationship between employer and employee. Probably the most common form of transactional leadership is management by exception, whereby leaders remain relatively uninvolved with performance issues except at the extremes of high and low performance. Management by exception can be administered strictly with respect to only one end of the performance scale, but most commonly provides both positive reward for successful efforts and some measure of negative consequences for unsatisfactory performance.

Critics of strict transactional leadership maintain that management by exception cultivates a passive mindset that undermines high achievement—producing satisfaction through merely avoiding negative consequences and a steady but uninspired degree of professional advancement. It has often been suggested that under management by exception, most people will work only hard enough to avoid negative consequences (Bass, 1997). This may be particularly true within large bureaucratic ventures, such as the United States federal government. Since public service normally does not offer the same degree of advancement and earning potential as many comparable opportunities in the private sector, many federal employees work just hard enough not to be dismissed and to progress through the time-in-grade-based advancement schedule (Bass, 1997).

Transformational Leadership

Where transactional leadership is operationally focused, transformational leadership is motivationally focused. Transformational leaders emphasize a corporate vision or an enterprise philosophy rather than specific operational tasks or performance-based achievement (Bass, 1985). Compared to the transactional orientation, transformational leadership is much more truly a style of leadership than a personnel management system.

The assumption underlying transformational leadership is that positive results follow inevitably as a function of philosophical unity within the business enterprise (Bass, 1985). It reflects a much more person-oriented administrative approach, and specifically, transformational leadership encourages fundamental personal self-identification on the part of component individuals with the corporate vision or philosophy. Transformational leadership emphasizes the notion that employees are becoming part of something much bigger and more important than just a means of earning a living or achieving personal goals (Bass & Steidlmeier, 1999).

Because it values belonging over doing, transformational leadership is more suitable to industries and ventures that depend on motivation and relatively unskilled labor than to industries where substantive knowledge, objective performance, and results demanding technical expertise or proficiency are required. Therefore, transformational leadership is most appropriate for sales-oriented industries rather than for industries dependent upon continual operational improvement, technical innovation, or highly skilled labor. By definition, those types of fields require that reward be related to function rather than to manifestations of corporate identity or affiliation with the entity's philosophy or worldview (Bass, 1997).

Transformational leadership relies heavily on group rituals, motivational meetings, ceremonies, and symbolism to cultivate group unity and encourage identification with the corporate vision or message—ideally as a comprehensive life focus rather than just in connection with employment. For this reason, it also lends itself to corruption into cult-like behavior at the most extreme. Besides its limitation to sales and promotional types of enterprises, transformational leadership is also better suited to industries where high turnover is expected, because constant exposure to such a high-energy environment and message can become psychologically draining and result in high burnout rates (Bass, 1985). Finally, because transformational leadership focuses more on group identity than on objective performance standards, organizations employing it are comparatively slow to recognize the need for operational change or to respond to market fluctuations (Bass, 1985).

Conclusion: Combining Leadership Styles

Generally, leadership styles are more rarely one-dimensional than they are multidimensional systems that incorporate various elements of other philosophies of business leadership or management. In practice, all forms of leadership are likely to feature some component of transactional reward or benefit associated with performance—whether performance is readily capable of objective measurement or merely a function of demonstrated group loyalty or personal allegiance to the enterprise vision or message.

Both transformational and charismatic leadership emphasize aspects of interpersonal charisma, but to varying degrees and with a different specific focus. Whereas transformational leaders employ charisma to generate personal identification with the corporate message, charismatic leaders use the same techniques to inspire loyalty on a more personal level.

Certain combinations of leadership styles are naturally more compatible than others. For example, transactional leadership complements servant leadership in that both emphasize objective performance. Conversely, charisma is a beneficial trait for all leaders with the possible exception of servant leadership. As between transformational and charismatic leadership, interpersonal relations, group unity through identity, ritual ceremonies, and symbolism play very similar roles, differing mainly in the specific object of loyalty.

Ultimately, transactional motivation characterizes the most common relationship between the individual and the community in modern society, principally because most work must fulfill specific functions or meet certain output goals. Transformational and charismatic leadership, by contrast, both lend themselves to pathological loyalty to corrupt ideology and personalities—a risk that leaders and organizations must remain mindful of when selecting and implementing their preferred approach.

References

Bass, B. (1985). Leadership and performance beyond expectations. Free Press.

Bass, M. (1997). Does the transactional/transformational leadership transcend organizational and motivational boundaries? American Psychologist, 52.

Bass, B., & Steidlmeier, P. (1999). Ethics, character, and authentic transformational leadership behavior. Leadership Quarterly, 10.

Edey, M., & Johanson, D. (1989). Blueprints: Solving the mystery of evolution.

Musser, S. (1987). The determination of positive and negative charismatic leadership. Grantham, PA.

Spears, L. (2002). Tracing the past, present, and future of servant leadership. In L. Spears & M. Lawrence (Eds.), Focus on leadership: Servant-leadership for the twenty-first century. Wiley.