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Topic: Leadership

The effect of transactional leadership in the workplace

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Whether you’re new to management or not, growing and developing your personal leadership style is vital to your overall success within your team or department. Your style needs to help not only motivate and engage employees, but help them feel valued in their position so they can continue to produce great work. One leadership style that has always been prevalent in the workplace is transactional leadership. 

What is transactional leadership? According to the International Review of Management and Business Research, “Transactional leadership, also know as managerial leadership, focuses on the role of supervision organization, and the group performance; transactional leadership is a style of leadership in which the leader promotes compliance of the followers through both rewards and punishments…These leaders pay attention to followers’ work in order to find faults and deviations. This type of leadership is effective in crisis and emergency situations, as well as when projects need to be carried out in a specific fashion.”

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As one of the most often used leadership styles, transactional leadership focuses on the basics of management which include control, organization and short-term planning. Some famous transactional leaders in history include James Madison, George H. W. Bush and Dwight Eisenhower. These leaders were able to leave successful legacies because of their style of leadership with the focus on accomplishing the specific tasks at hand.

What do transactional leaders believe in?

Transactional leadership focuses on the bottom levels of Maslow’s hierarchy of needs in order to motivate and drive success. These lower levels, which include primarily physiological (food, water, warmth, rest) and safety needs, must first be met before we can continue to the next level of the pyramid. Each level motivates behavior, and when the lower levels of the hierarchy are met, leaders can stress specific task performance by managing each task individually.

More importantly, transactional leaders motivate their employees through a reward and/or punishment system.

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As you can see, the types of motivation vary from a hands-on approach to allowing the group to make decisions themselves without input from the leader. These types of exchanges are how transactional leaders best motivate and manage their workforce.

It’s important to have a successful rewards system within your company culture that helps not only motivate the employees, but helps them feel more valued within their positions. Don’t be afraid to reach out to employees to learn what best motivates them and how they want to be rewarded for a job well done. Also, know that there are many ways to appreciate your employees, from handwritten notes to social shoutouts and gifts. Throw a party, take your employees to a movie—what matters is that employees know and feel that the leadership recognized their work. Better yet, learn how employees work best and work to create a team culture that supports employees in their tasks.

What about transformational leadership?     

Through transactional leadership, it can help leaders develop into a more proactive form of transformational leadership. What is transformational leadership? International Review of Management and Business Researchexplains, “Transformational leadership enhances the motivation, morale, and performance of followers through a variety of mechanisms. These include connecting the follower’s sense of identity and self to the project and the collective identity of the organization; being a role model for followers that inspires them and makes them interested; challenging followers to take greater ownership for their work and understanding the strengths and weaknesses of followers, so the leader can align followers with tasks that enhance their performance.” With transformational leadership, it helps engage employees by creating value in the workplace.

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Furthermore, by knowing what motivates your employees, the next step is to become more trusting in their work and empower employees by appealing to the higher steps of Maslow’s hierarchy of needs (belonging, esteem and self-actualization). When these are met, it can help employees grow within their jobs and participate in helping grow the company and its culture.

Transformational leadership is what all managers with transactional leadership skills should inspire to become. This leadership style cultivates the right type of engagement from workers, and better yet, grows them into confident experts and leaders. Through transformational leadership, it can help increase office efficiency, better performance from employees and thus better work produced. Basically, great leaders have attributes from both leadership styles, which build on each other.

As a leader, it’s important that you motivate and engage your employees in the right way. Transactional leadership is a great stepping stone when developing leadership skills with the ultimate goal of having a leadership style that challenges and grows your employees into leaders and experts within your industry.

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