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Transactional Leadership

Transactional leadership focuses on achieving goals through rewards and punishments. Leaders offer direction in exchange for compliance and dedication to objectives. Transactional leaders use coercive power like reprimands or reward power like bonuses to motivate subordinates. This style is effective for short-term goals but may not create long-term dedication. Setting clear expectations and giving performance reviews are examples of how transactional leadership can be applied, such as rewarding top salespeople to inspire a team to hit monthly targets.

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Alejandro Calvo
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190 views3 pages

Transactional Leadership

Transactional leadership focuses on achieving goals through rewards and punishments. Leaders offer direction in exchange for compliance and dedication to objectives. Transactional leaders use coercive power like reprimands or reward power like bonuses to motivate subordinates. This style is effective for short-term goals but may not create long-term dedication. Setting clear expectations and giving performance reviews are examples of how transactional leadership can be applied, such as rewarding top salespeople to inspire a team to hit monthly targets.

Uploaded by

Alejandro Calvo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Handout - Transactional Leadership

Group 6

Nainesh Tarke

Nirav Goswami

Jatin Parmar

Leadership and Professionalism, Supply Chain Management

Saskatchewan Polytech, Moose Jaw Campus

Professor: Amin Berry

Due Date: March 5, 2023


Transactional Leadership

• Transactional leadership is a style of leadership that focuses on achieving specific goals


and objectives through a system of rewards and punishments. This form of leadership
incorporates a distinct chain of command. Leaders offer advice and direction in return for
their subordinates' compliance and dedication to the organization's objectives.
• Forms of Powers - Transactional leaders most frequently employ two types of power:
coercive power and reward power. Reward power refers to offering constructive
criticism, such as promotions, bonuses, or other incentives, to motivate subordinates to
follow instructions and progress toward objectives. Coercive authority involves using
negative reinforcement, such as reprimands, promotions, or even termination, to prevent
followers from acting in detrimental ways to the organization’s goals.
• Effectiveness - Generally, transactional leadership is more successful in attaining short-
term objectives like hitting sales targets or finishing a project. This leadership approach
strongly emphasizes quick wins and rewards for accomplishing them, which may
motivate followers in the short run. It might be less successful, though, in achieving long-
term objectives like creating a solid corporate culture or a workforce that is dedicated and
highly competent.
• Application - Setting clear expectations for their followers and giving regular
performance evaluations are only two ways leaders might employ the transactional
leadership paradigm. By rewarding the top-performing salesman, for instance, a sales
manager could utilize transactional leadership to inspire their team to hit a monthly sales
goal. The team members may feel competitive, which may spur them to exert more effort
to reach the objective.
• Benefits - Using transactional leadership theory has advantages, such as its emphasis on
accomplishing goals and objectives, which can assist firms in meeting their short-term
ambitions. This type of leadership can also be effective in circumstances requiring
structure and clear direction, such as in high-stress, time-constrained settings. Finally,
because followers understand precisely what is expected of them and how they will be
rewarded for meeting those expectations, transactional leadership can give followers a
sense of security.
References
Lindberg, C. (2020, May 19). Transactional Leadership - Explained By A CEO. Leadership
Ahoy! https://www.leadershipahoy.com/transactional-leadership-what-is-it-pros-cons-
examples/
Lutkevich, B. (2022, August). What is transactional leadership? - Definition from WhatIs.com.
SearchCIO. https://www.techtarget.com/searchcio/definition/transactional-leadership
Mahaffey, C. T. (2021, August 5). Ten transactional leadership characteristics - TheLeaderboy.
https://theleaderboy.com/transactional-leadership-style-characteristics/
Muldrew, E. (2019, June 11). Motivating a workforce by Steve Jobs. Medium.
https://edwardmuldrew.medium.com/motivating-a-workforce-by-steve-jobs-
bf1180c16f5d#:~:text=Steve%20Jobs%20fit%20in%20the
STU Online. (2014, November 25). What is Transactional Leadership? Structure Leads to
Results. STU. https://online.stu.edu/degrees/education/what-is-transactional-leadership/
Transactional Leadership Definition. (n.d.). Www.free-Management-Ebooks.com.
http://www.free-management-ebooks.com/faqld/leadership-04.htm

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