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History of Transactional Leadership Theory

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Sergei Skorozvon

on 21 April 2016

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Transcript of History of Transactional Leadership Theory

Transactional Leadership Style

Overview
Basic Assumptions
3 Dimensions of Transational Leadership
Conclusion
The transactional style of leadership is viewed as insufficient, but not bad, in developing the maximum leadership potential. It forms as the basis for more mature interactions but care should be taken by leaders not to practice it exclusively, otherwise it will lead to the creation of an environment permeated by position, power, perks, and politics.
Max Weber

Transactional leadership, also known as managerial leadership, focuses on the role of supervision, organization, and group performance. Leaders who implement this style focus on specific tasks and use rewards and punishments to motivate followers.
Employees are motivated by reward and punishment.
People perform their best when the chain of command is definite and clear.
Subordinates need to be carefully monitored to ensure that expectations are met.
Contingent Rewards

Managers set SMART (specific, measurable, attainable, realistic, and timely) goals for their subordinates.
Active Management by Exception

Transactional leaders actively monitor the work of their subordinates
Passive Management by Exception

Transactional leaders intervene only when standards are not met or when the performance is not as per the expectations.
Pro
Transactional leadership theories are simplistic and easy to administer.


Con
The theory assumes everyone is rational; it disregards emotions and social values.


Pro
There is minimal need in the short run to train leaders; tell people to obey or else.


Con
It presumes people are always motivated by rewards and punishments. It ignores altruism or will to power.


Pro
When time is of the essence, the transactional method can be very expeditious.

Con
An organization can become dependent upon one or a few leaders; if the leadership disappears, it will be more difficult to replace it.
Pro
The transactional leadership theories takes advantage of well-known and tested ideas
Con
It has not been demonstrated to be the most effective leadership method in lesser stressful situations.
Implications
The transactional leaders are found to be quite effective in guiding efficiency decisions which are aimed at cutting costs and improving productivity.
It can also work well in crisis situations where the focus needs to be on accomplishing certain tasks.
Reference:
Based on Jim Harvey's speech structures
Bernard Bass
J. McCarthy
De Gaulle
Transactional Leadership Theory - Meaning, its Assumptions and Implications. (2016). Managementstudyguide.com. Retrieved 19 April 2016, from http://managementstudyguide.com/transactional-leadership.htm
Transactional Leadership Theories. (2016). Leadership-Central.com. Retrieved 19 April 2016, from http://www.leadership-central.com/transactional-leadership-theories.html#axzz46HBMdDl2
Cherry, K., & Cherry, K. (2016). How Does Transactional Leadership Work?. About.com Health. Retrieved 19 April 2016, from http://psychology.about.com/od/leadership/f/transactional-leadership.htm
Pro
It is much more effortless to parcel out rewards and punishments,



Con
The theories encourages destructive competition and in the long-run can impair an organization, especially from the inside.
How transactional leadership works
Rules, procedures, and standards are essential in transactional leadership.
Followers are not encouraged to be creative or to find new solutions to problems.
Full transcript