TRANSFORMATIONAL LEADERSHIP & TRANSAKTIONAL LEADERSHIP By Mutia and Riza

DEFINITIONS TRANSFORMATIONAL “Transformational leaders transform the personal values of followers to support the vision and goals of the organization by fostering an environment where relationships can be formed and by establishing a climate of trust in which visions can be shared”. Bernard Bass (Stone et al, 2004) TRANSFORMATIONAL

CHARACTERISTICS TRANSFORMATIONAL Charismatic Influence Inspirational Motivation Intellectual Stimulation Individualized Consideration TRANSFORMATIONAL

ADVANTAGES TRANSFORMATIONAL Creates an enthusiastic work environment and drives the organization with innovations and changes with efficiency and output. This will likely develop future leaders from a lot of followers. Leaders arouse emotions toward their followers that motivate them to act beyond the framework of what may be described as exchange relations. It forms new expectations in followers since leadership is proactive. It motivates followers to work for their goals that certainly go beyond their self interest. High productivity can be guaranteed in this kind of leadership theory. TRANSFORMATIONAL

DISADVANTAGES TRANSFORMATIONAL This is likely based on the leader’s ability for inspiring the work force to put their best in whatever they do. Some leaders may not have such ability and force of character to enforce and achieve that. Some leaders do not have this character and because of this, his leadership might be drawn in the edge. TRANSFORMATIONAL

Keith Wandell TRANSFORMATIONAL “When leaders cannot provide integrity and transparency, they’re done. The ability to focus on customers, creativity and innovation are also part of the evaluation process that has put in place.” TRANSFORMATIONAL

DEFINITIONS TRANSACTIONAL Transactional leadership focuses on results, conforms to the existing structure of an organization and measures success according to that organization’s system of rewards and penalties. TRANSACTIONAL

CHARACTERISTICS TRANSACTIONAL Contingent reward Active management by exception Passive management by exception Laissez-faire TRANSACTIONAL

ADVANTAGES TRANSACTIONAL Rewards those who are motivated by self-interest to follow instructions Provides an unambiguous structure for large organizations, systems requiring repetitive tasks and infinitely reproducible environments Achieves short-term goals quickly Rewards and penalties are clearly defined for workers TRANSACTIONAL

DISADVANTAGES TRANSACTIONAL Rewards the worker on a practical level only, such as money or perks Creativity is limited since the goals and objectives are already set Does not reward personal initiative TRANSACTIONAL

Howard Schultz TRANSACTIONAL “Starbucks is not an advertiser; people think we are a great marketing company, but in fact we spend very little money on marketing and more money on training our people than advertising.” TRANSACTIONAL

TRANSFORMATIONAL vs TRANSACTIONAL TRANSFORMATIONAL LEADERSHIP Leadership is proactive Works to change the organizational culture by implementing new ideas Employees achieve objectives through higher ideals and moral values Motivates followers by encouraging them to put group interests first Individualized consideration: Each behavior is directed to each individual to express consideration and support. Intellectual stimulation: Promote creative and innovative ideas to solve problems. TRANSACTIONAL LEADERSHIP Leadership is responsive Works within the organizational culture Employees achieve objectives through rewards and punishments set by leader Motivates followers by appealing to their own self-interest Management-by-exception: maintain the status quo; stress correct actions to improve performance

Thanks a Bangs!