Transactional Leadership

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Transactional leaders focus on achievement through the use of rewards as motivation, such as the “carrot or the stick” approach. Complete a task correctly and on time and you are rewarded with time off, a bonus, or perhaps recognition. Miss a deadline or produce an unacceptable product and you may come face to face with a reprimand (verbal or written), and if bad enough (or too frequent), termination.
 
The challenge here is, not all leaders offer both carrot and stick. Sometimes, it is just one or the other, or overly emphasized on one or the other. Here are a few transactional leaders that you may have experienced.
 
The Pushover
 
This is the leader who is averse to confrontation and less likely to provide any punitive action – even a short conversation telling the employee to improve next time. This results in the Pushover becoming a pushover (the name explains it all) and being taken advantage of. What also happens here is, those individuals who do the right thing, become less motivated to continue and either become the next bad apple (remember that it only takes one?!) or become fed up and leave. Either situation is never fun to correct.
 
The Softy
 
Let’s face it, we love The Softy. This is the leader that is just so calm and gentle, and everything seems to be going well, but you just never can tell what is going on or what is expected. You look for constructive criticism and you get mixed signals – “you did well, but I don’t like this, but it’s ok”, and so on. Is it acceptable or not? Just tell me! If nothing is clearly stated, you go on doing… whatever… resulting in little improvement.
 
Mr./Mrs. Rage
 
This is the leader that likely never comments (positively) on the accomplishments, but as soon as a mistake is made, they go nuclear – no matter how small the mistake. Everyone has a bad day and loses their cool, but Mr. or Mrs. Rage seem to have a bad day every day and take it out on others. If they stay around too long, nobody else will.
 
Mr./Mrs. Nice Guy/Gal
 
No matter what you do – good or bad – they find the positive. While this seems nice at first, it is difficult to improve as it is challenging to identify where to improve if the shortfall always seems to lead to a positive. I am not talking about learning here. Learning is a result of trying something new, which often leads to making a mistake (and this is ok). Mr./Mrs. Nice Guy/Gal finds it ok that the report was late (all of the time) because you were able to produce a nicer cover or clearer results (even though you ignored it for a couple of days). See the difference?
 
Balance
 
The reality is, none of these styles are going to work for long. It takes a balanced leadership approach to being an effective leader, and knowing when and how to employ the transactional leadership style. Motivate others to achieve through the use of a reward and punish appropriately when necessary. Another piece to consider is that not everyone is motivated by money. Check out last week’s post discussing Transformational Leadership, there is a comment about motivation that makes this a bit clearer.
 
Transactional leadership has its place, often in situations of less stress (Bass, Avolio, Jung, & Berson, 2003) and where rewards for achieving certain goals are an effective means of motivating others. Additionally, transactional leaders tend to be more focused on rules, standard operating procedures (SOPs), and policies (Bryant, 2003). If you find yourself in an organization that seems to motivate others through bonuses or time off and emphasize adherence to SOPs and policies, you may be following a transactional leader.
 
Jared W. Snow
 
Bass, B. M., Avolio, B. J., Jung, D. I., & Berson, Y. (2003). Predicting unit performance by assessing transformational and transactional leadership. Journal of Applied Psychology, 88(2), 207-218. doi:10.1037/0021-9010.88.2.207
 
Bryant, S. E. (2003). The role of transformational and transactional leadership in creating, sharing and exploiting organizational knowledge. Journal of Leadership & Organizational Studies, 9(4), 32.