Without proper leadership, it is quite challenging to achieve organizational goals. Leadership quality of a person is the capability or the trait of the leader that influences the behavior of other persons in an organization to put their best efforts to see the organization grow. Management Gurus have classified this leadership quality in many forms and the two most vital qualities according to them is to be Transactional leader or a Transformational Leader. The styles of working in these two types of leadership differ a lot, and the approaches are different.

Transactional Leadership

In this type of leadership, the main focus is on the interaction of the leader with the subordinates, and the leadership style is reactive.

Transformational Leadership

In this type, the leader becomes the source of change in attitude amongst the subordinates, and the leadership style is much proactive.

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The Difference Between The Two Styles

Although both types of leadership are to bring out the best amongst the subordinates and the employees in the organization to reach the ultimate objective, the approach differs. Let us discuss the differences between the two leadership styles.

In transactional leadership, the rewards and punishment style approach for motivating the followers is applied whereas in case of transformational leadership it is the enthusiasm and the charisma of the leader that psychologically inspires the subordinate’s to work perfectly resulting in fulfillment of the organizational goals. It is a bit softer an indirect approach and not as robust as the transactional leadership approach.

When a leader takes the transactional leadership approach, it is understood that the leader is concerned and gives stress on the relationship with his followers, and it is somewhat reactive, and the organization is having a settled environment and otherwise moving smoothly. However, in transformational leadership, the values, morals, ideals or the needs of the followers are looked by the leader and a proactive approach is taken to motivate them. They are perfect when the environment of the organization is volatile or turbulent.

Transactional leadership tries to improve the existing organizational culture and strengthen it more with rules and regulations working somewhat in a bureaucratic style and on the contrary transformational leadership seeks to replace the current culture of the organization and introduce new style and methods of working, and it is done by the charisma and aura of the leader.

Since Transactional leadership style has a robust, bureaucratic approach, it has one leader, and the decision of the leader is final whereas in transformational leadership there are many leaders as the path is bit compassionate, caring and understanding the subordinates.

The motivational tools used in the transactional leadership method is to put the self-interest of the followers on the top like getting rewards for success or punishment at times for non-fulfillment of the duties bestowed on them. Conversely, transformational leadership gives priority to group activity and collective success and failures and boosts the enthusiasm uniformly.

The main focus of transactional leadership is to do the perfect planning and executing the plans to achieve the goals of the organization. It is done in a structured manner. Whereas in transformational leadership the main focus is innovation and new ideas and methods are applied depending on the situation to move towards the goals.

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Overview

Although it is a debatable issue to single out which leadership is best for the organization to achieve its goals, it depends on the ground reality, and both the styles have pros and cons. Nothing is ultimate while working on the ground and the prevailing situation can only determine how to give the leadership. No one can standardize them and often a mix, and match approach is taken to get a solution. Reaching the organizational objective is ultimate and nothing else.