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Transactional vs Transformational Leadership


Are you confused between transactional vs transformational leadership? Not to worry, Takethiscourse has arrived with the much-anticipated comparative article between the two. There are numerous different leadership styles to manage a corporation, but the majority of leadership styles are either task-oriented or life-changing. Get access to best online leadership training courses here.

In this feature, we will look at the dichotomy between transactional vs transformational leadership styles, as well as the characteristics of each. Which leadership style, transformative or transactional, best suits your team will be revealed here, as there are many essential characteristics to each leadership style. The said feature will focus on the important characteristics of tranformational vs transactiional leadership. Keep reading to gain an overview of which style will work best for you and your team. Let’s get started.


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What is Transactional Leadership?

In a 2015 article about organizational leaders published in the International Journal of Scientific research, transactional leaders are classified as leaders:

Replacing the wants of a leader for the wants of a follower emphasizes development in goal setting, influence decisions and attempts to control outcomes, someone with a strong personality and the ability to make important decisions.

Transactional leaders typically monitor by distinction, which indicates they will not implement adjustments or even get entangled if everything goes well (as per plan). Significant exceptions, such as missed sales goals or production value targets, are dealt with, immediately. This style of leadership can be seen in varying degrees of practice and varies according to mission and vision.

What is Transformational Leadership?

Transformational leaders, according to Psychologist Ronald E. Riggio, have specific intellectual stimulation traits:

Leaders with idealized influence hold, share and demonstrate core values and trust following inspirational motivation. They motivate employees by conveying confidence, a sense of purpose, providing opportunities for creativity and innovation, and allowing people to learn, grow, and try new things.

Although transformational leadership sounds admirable, it has some drawbacks. It may be ineffective at certain stages of business development and may fail to originate in political surroundings. Transformational leadership cannot create a management structure if one does not already exist.

Difference between Transactional vs Transformational

Being a leader in your field, you may be curious about how these leadership styles manifest themselves in practice. They are, in essence, a spectrum rather than opposing forces. The major difference between Transformational leadership vs Transactional leadership is the significant needs both styles cater to. Transformational leadership is concerned with stimulating others to implement and necessitates a high degree of organization, correspondence, and teamwork. On the contrary, Transactional leadership is mainly concerned with procedures and governance, and it usually requires a rigid management framework. The distinction can be summarized as follows:

Transactional leadership focuses on how to get tasks completed, whereas Transformational leadership focuses on how to encourage employees to complete projects.

Importance of Transactional Leadership

Transactional leaders can succeed in crises or on projects that necessitate specific procedures. There’s a probability that you’ve experienced transactional leadership without even realizing it. Teachers who offer good grades in exchange for high academic performance are an example that is often underestimated, as is a career advancement offer in return for exceptional performance at work. Transactions can occur in educational and corporate settings as well. University leaders use due process systems to grade students and boost encouragement for them to work better in order to achieve academic success. You can also find out why leadership training for managers fails here.

Importance of Transformational Leadership

According to Leadership: Theory, Application, and Skill Development by Lussier and Achua, Martin Luther King, Jr. exemplifies a transformational leader because he instilled trust in his followers, challenged commonly held assumptions, met their needs, and upheld high moral values. The authors also classify Oprah Winfrey as a transformational leader because of her vision and ability to transform any venture she embarks on. Managers usually have a big picture goal in mind being Transformational leaders. This style of leadership seems to be more cooperative than transactional leadership because it requires managers to encounter problem-solving and the main objective as a whole-team effort.


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Shared Characteristics of Transformational Leaders

Some characteristics are shared by great transformational leaders:



One of the most common features is that transformational leaders understand how to maintain their team inspired and how to constructively improve each team member’s skill sets. Predictably, this implies that a great transformational leader must be intimately familiar with their team.

Providing Examples

Transformational leaders not only know their team intimately, but they also lead by example. They are open and honest about their mistakes, and they place a high value on their own self-improvement as well as the development of their team. This is accomplished through another key characteristic of transformational leaders which is the exchange of information or open dialogue. If you’re interested in healthcare industry, you should follow here for strategic leadership in healthcare.


Great leaders have excellent communication skills, but transformational leaders must also be responsive in their approach, enabling for training and career guidance within their team and inspiring their team to take ownership of their progress, poor decisions, and strengths.

Shared Characteristics of Transactional Leaders

Some characteristics are shared by great transactional leaders

Reward and Punishment System

Transactional leaders employ a system similar to a reward and punishment system. Leaders involved in Transactional performance implement a reward system, such as a bonus system, for when your team performs well. However, in this context, the term “punishment” does not always imply “punishment.” If a team member makes an unintentional mistake, as a Transactional leader you must instruct the team member throughout the process to reprimand the errors as well as how to avoid falling into the loop again. This type of ‘punishment’ is much more impactful than straightforward disciplinary restrictions in building meaningful relationships.

Short-Term Goals

short term goals

Transactional leaders are more likely to focus on short-term objectives. They place a strong emphasis on self-motivation for their team, with a well-defined rewards system and incentives for meeting deadlines and, perhaps most importantly, they compel progress by uplifting their team, interacting with them, and ensuring that objectives are set defined, laid out, and reachable for one‘s team. You might also be interested in the best ways to develop a leadership skill at takethiscourse.net.

Structure and Hierarchy

Transactional leadership is an excellent leadership style to use in a team that moves from task to task or sets fewer performance objectives inching closer to a larger goal. Mid-sized teams, in general, and especially, can benefit from this style because its precisely articulated structures and hierarchies provide a line of authority up to the manager as well as a concise strategy for achieving their agreed goals. Transformational leadership is excellent for long-term goals, just as transactional leadership is excellent for short-term goals.

Which Style of Leadership is Better for You?

Both Transactional vs Transformational Leadership are appealing. Therefore, to argue about which leadership style is superior is crucial to assert. Both styles seem to be correct, and it is the frame of reference that counts. Some organizations require solidity as well as a transparent command structure. Others thrive in a volatile environment where leadership defines the instance and promotes innovation. In the same establishment, both types of leadership styles may be required to help offset each other and facilitate emotional wellbeing and development goals.


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Final Thoughts

Finally, transactional leaders ensure that the team is running smoothly and producing results today, whereas transformational leaders encourage innovation and look ahead. In either case, education and training can be a powerful tools for advancing one’s leadership abilities. Lead your team the right way!