1. Leadership & Management
Reading for Lesson 9:
Transactional and Transformational Leadership

2. Lesson 1 Reading Objectives
The student will comprehend the characteristics of transactional leadership.
The student will comprehend the characteristics of transformational leadership.
The student will comprehend the primary differences between transformational and transactional leadership.
The student will comprehend the impacts that transformational leadership can have on a unit.

3. Lesson 9 Discussion Objectives
The student will comprehend the primary differences between transformational and transactional leadership.
The student will comprehend the impacts that transformational leadership can have on a unit.

4. Characteristics of Transactional Leadership
Occurs when leader and followers are in an exchange-based relationship.
Goal is to meet the other party’s needs.
Relationship between leader and follower tends to be transitory.
Effective only as long as relationship is mutually beneficial.

5. Characteristics of Transactional Leadership
Contingent reward
Contracts exchange of rewards for effort
Promises rewards for good performance
Recognizes accomplishments

6. Characteristics of Transactional Leadership
Management by Exception (Active)
Watches and searches for deviations from rules and standards
Takes corrective action
Management by Exception (Passive)
Intervenes only if standards are not met

7. Characteristics of Transactional Leadership
Laissez-faire
Abdicates responsibilities, avoids making decisions

8. Characteristics of Transformational Leadership
Leaders strong in this quality perform exceptionally well in situations of crises.
They have a vision of what a new society or organization could be.
Strong bonds are cultivated between leader and subordinates.
Followers willingly subordinate themselves.
Strong emotional bonds develop over time.

9. Characteristics of Transformational Leadership
Charisma
Provides vision and sense of mission
Instills pride
Gains respect and trust
Inspiration
Communicates high expectations
Uses symbols to focus efforts
Expresses important purposes in simple ways

10. Characteristics of Transformational Leadership
Intellectual stimulation
Promotes intelligence, rationality, and careful problem solving
Individual consideration
Gives personal attention
Treats each employee individually
Coaches
Advises

11. Primary Differences between Transformational & Transactional Leadership
Transformational Leader
Builds & instills vision based on organizational values.
Enjoys good relationships with subordinates
Leader contributes more
Employees exert greater efforts for leader
Leaders and followers raise one another to higher level of motivation and morality
Transactional Leader
Leadership act does not bind leader and followers in mutual and continuing pursuit of a higher purpose

12. Primary Differences between Transformational & Transactional Leadership
Categories
Transactional
Transformational
Leader’s source
of power
Rank, position
Character, competence
Follower reaction
Compliance
Commitment
Time frame
Short term
Long term
Rewards
Pay, promotion, etc.
Pride, self-esteem, etc.
Supervision
Important
Less important
Counseling focus
Evaluation
Development
Where change occurs
Follower behavior
Follower attitude, values
Where “leadership” found
Leader’s behavior
Follower’s heart

13. Impacts of Transformational Leadership on Unit
Image
Recruiting
Selection
Promotion
Transfer
Development
Training
Approaches to training
Leadership education
Job design and assignment
Organizational structure