Types of Leaders
Key Behaviors of Transactional Leaders
Transactional leaders focus on performance, promote success with rewards and punishments, and maintain compliance with organizational norms.
LEARNING OBJECTIVE
-
Identify the different behaviors attributed to transactional leaders and how they can motivate an organization
KEY POINTS
- Transactional leaders focus on managing and supervising their employees and on group performance. They monitor their employees' work carefully to assess any deviation from expected standards.
- Transactional leaders promote success by doling out both rewards and punishments contingent on performance.
- Transactional leaders work within existing organizational structures and shape their work according to the current organizational culture.
TERM
- Maslow's Hierarchy of Needs
A psychological theory, proposed by Abraham Maslow in the 1943 paper "A Theory of Human Motivation," which depicts lower- and higher-level human needs in the form of a pyramid.
Transactional leaders focus on managing and supervising their employees and on facilitating group performance. The role of a transactional leader is primarily passive, in that it sets policy and assessment criteria and then intervenes only in the event of performance problems or needs for exceptions. Transactional leaders seek to maintain compliance within existing goals and expectations and the current organizational culture. They are extrinsic motivators who encourage success through the use of rewards and punishment.
Benchmarking Measures Performance
Results are the paramount concern to a transactional leader. Performance ratings can be used to measure results.
Transactional leaders are expected to do the following:
- Set goals and provide explicit guidance regarding what they expect from organizational members and how they will be rewarded for their efforts and commitment
- Provide constructive feedback on performance
- Focus on increasing the efficiency of established routines and procedures and show concern for following existing rules rather than making changes
- Establish and standardize practices that will help the organization become efficient and productive
- Respond to deviations from expected outcomes and identify corrective actions to improve performance
Psychologist Abraham Maslow characterized people's motivating factors in terms of needs. Maslow's Hierarchy of Needs describes levels of needs ranging from the most essential, such as physiological (e.g., food and sleep) and safety, to higher levels of esteem and self-actualization. Transactional leadership satisfies lower-level needs but addresses those at a high level only to a limited degree. As such, transactional leaders' behavior appeals to only a portion of followers' motivating factors.
Transactional leadership can be very effective in the right settings. Coaches of sports teams are a good example of appropriate transactional leadership. The rules for a sports team allow for little flexibility, and adherence to organizational norms is key; even so, effective coaches can motivate their team members to play and win, even at risk to themselves.