Transformational Leadership or Effective Managerial Practices - Essay Example

The Author’s Name] [The Professor’s Name] [The Course Title] [Date] Transactional and Transformational Leaders Although current leadership theory emphasizes the distinction between transactional and transformational leadership, in fact, most leaders have a mixed profile of the full range of leadership styles. The best form of leadership is not only transformational or only transactional, but rather a combination of the two. However, in order to better understand each style’s pros and cons, they have to be discussed in terms of similarities and differences. This cross-analysis will reveal further inquiry topics. Most leaders and followers find themselves in transactional relations – leaders engage in an exchange process with followers: jobs for votes for example. The leader rewards or punishes the follower on the basis of performance. The transforming leader is more effective, by looking for potential determination in followers, seeking to satisfy higher needs, and totally engaging the follower. The resulting relationship is mutually stimulating. (Goleman, D. 2000, pp.78-90) This type of leadership has been considered to be superior, leading to higher efficiency. New systemic theories, however, show a slightly different perspective. Transactional leadership, on the other hand, involves extrinsic motivations. Followers are either positively motivated by praise and reward or they are negatively motivated through threats or disciplinary actions. Performance is the only criteria taken into consideration in the case of transactional leadership. Everything is structured into activities, each characterized by a clear set of implicit or explicit rewards/punishments. Performance is monitored at all times. Management, in this case, can be either active, when followers’ mistakes are corrected during the process, preventively, or passive, in which case the managers wait for followers’ mistakes before taking corrective action. (Sarros, 2001, p383) Considering a complex adapting systems theory, these differences can be viewed from a different perspective. New approaches on the subject state that human organizations are emergent systems of actions that transform themselves through social interaction. The systems’ leadership is an element of these organizations, a function of the whole (and not a person role) that provides for the system’s ability to co-evolve with its environment. Smith (1990, pp10-12) states that ‘the dissipative structure transformation can be viewed as a type of system evolution, one in which a whole-system change increases resilience and system functioning capacities within an environment’. The dissipative change differs from evolution through adaptation and selection. It involves quick change. Both types of change are important at a certain moment in the development of the same system, just as both types of leadership are needed in diverse circumstances. Older management theories emphasize only the advantages of transformational leadership and disadvantages of transactional leadership, shedding a negative light on the latter. The paradigm of dissipative structure implies a change that takes place through the breakdown and rebuilding of a structural arrangement, within a turbulent environment. This aspect becomes a virtue of transactional leadership, as opposed to the transformational leadership which is based on continuous adaptation and evaluation. (Keller, 1995, pp41-44) The complex adaptive systems perspective emphasizes the positive aspects of transactional leadership. There are seven conceptualizations of transformational leadership: articulating a vision of the future, encouraging group-oriented work, setting high expectations, challenging followers’ thinking, supporting follower’s individual needs and acting as a role-model. What ties transformational, situational, and innovative leadership styles together are individuals transforming organizations through new concepts, techniques, and processes. These items are used to improve personal productivity and performance. They are aware that leaders lead the charge to introduce creativity and commitment. This is accomplished through motivating, training, and developing individuals. Into the bargain, these styles bring change for a company’s betterment. ‘People without information cannot take responsibility. People with information cannot help but take responsibility’ (Bass & Steidlmeier, 1998, p.39) The key actions that are shared with these two styles are: motivating others, inspiring others, training others, developing others, informing others, and accomplishing through others. Transformational leaders allow innovation to be achieved through those they influence by handling change, encouraging creativity, and understanding team dynamic, and encouraging diversity. Both a transactional and a transformational leader can be more or less charismatic, although it is traditionally believed that it is exclusively a trait of transformational leaders. Conger & Kanungo (1998, pp119-22) describe five behavioral attributes of charismatic leaders: vision and articulation, sensitivity to the environment, sensitivity to member needs, personal risk taking, and performing unconventional behavior. Most of the research in the field has been focused on the outcomes of transformational leadership. This has been done extensively, at the expense of neglecting other aspects, such as the underlying basis of leadership behavior. A large part of the literature explains the effects and results of transformational literature, while very little, if some, discusses why the phenomenon appears or not in certain situations/organizations. In what way do personal characteristics influence behavior, inducing leadership style? This is a question that has not received enough answers. It has been argued that emotional abilities are vital in performing quality leadership, as persuasion of employees in order to support organizational change is much more efficient when it appeals to emotion and not to reason (Brown, 1994, pp1-12). This is true to a certain extent. Followers have the tendency to respond quicker and more efficiently when they are appealed to at an emotional level. However, the rational level should not be completely ignored. Followers can relate emotionally only to decisions that they either agree or al least don’t disagree rationally. Nonetheless, the importance of a leader being able to correctly receive emotional feedback is unquestionable. Non-verbal communication plays a great role in decoding emotions. Indifferent of the leadership style, the ability to read and understand emotion leads to better relationships with followers. Theories around leadership have emerged for roughly one century, such as trait theories focusing on the leaders of the organization, or behavioral theories stressing the relationship between leaders and followers, but cannot explain the nature and effectiveness of leadership. (Zaleznik, A. 1992, pp 126-135) With the development of the theories, the Fiedler model, Hersey and Blanchard's situational theory, the leader-participation model, and the path-goal model are gradually welcomed, (Hersey and Blanchard, 1996, pp33-35) especially path-goal theory that says "it is the leader's job to assist followers in attaining their goals and to provide the direction and support needed to ensure that their goals are compatible with the overall objectives of the organization'. (Robbins, et. al. 2003, pp134-38) These kinds of theories called contingency propose the importance of the situations in which the leadership is influenced by contextual factors, like leader-follower connection, external environment and ethical issues etc. Besides, contemporary leadership theories involve in some cutting-edge approaches: transformational-transactional leadership, charismatic-visionary leadership, and team leadership. (Strange, JM, & Mumford, MD, 2005, 121-148) In these theories, a leader is described having the role of a coach with abilities to guide and motivate followers, offer more individual consideration, and be charismatic and visionary. Management is a transactional style, and the subordinates follow managers because they believe it will increase his or her salary or reward. Managers are work focused; they are paid to get things done often with great constraints of time and money. They usually pass this work focus to the subordinates. Managers also seek to avoid conflict. Leaders do not have subordinates but have followers and aspiring people to work and achieve an organizational goal. Leaders have charismatic and transformational styles that attract people, and followers feel that they have not just gained rewards but somehow feel they have made their lives better. (Zaleznik, A. 1992, pp 126-135) Leaders are always good with people, and quiet styles are very effective at creating loyalty. Leaders are achievement- focused which is very important in aspiring people to work towards their vision. Leaders are risk-takers and ready to take any problems that come their way. Leaders allow changes and use it to their advantage by taking the change that people would like to follow. Leaders are innovators with creativity to invent and focus on the vision. Leaders are mentors and see people strengths while manager evaluate people, restricts initiative, and looks for what employees are doing wrong. Leaders concentrate on the future while managers think about the short –term goals and focus on what needs to be dealt now. (Heckscher, 1994, pp129-37) To sum up, no leader can be exclusively transformational or exclusively transactional. This is only a theoretical discourse meant to better emphasize the similarities and differences. In terms of leader’s source of power, the main difference is that the transactional leader relies on rank/position, while the transformational leader trusts in character and competence. The first attitude leads to compliance, while the latter leads to commitment. Regarding the time-frame, transactional leadership is short-termed, whereas transformational leadership is oriented towards the long-haul. (Tracey & Hinkin, 1998, pp232-36) Both leaders offer rewards to the followers, but in the case of a transactional relationship these are contingent (pay, promotion), meanwhile transformational relationships rewards on a higher level (pride, self-esteem). In the first case supervision is vital, in the second it is not essential. Change affects primarily the followers’ behavior in a transactional oriented organization. In the case of a transformational relation, change affects the followers’ attitudes and values. According to Katz and Kahn (1966 cited in Hazy 2005, pp 245-50), organizational leadership is referred to, in complex systems’ terms, by a number of roles. Firstly, it clarifies organizational boundaries, the context for action for its members/non-members, and provides a certain pressure on members to operate efficiently. Secondly, organizational leadership responds to internal structural pressures and operates to improve the effectiveness of the organization’s capabilities. Thirdly, it increases micro-diversity and enriches recombination possibilities by searching the environment random changes. For the leaders and followers the practical implications refer to their relationships. Within complex adaptive systems transformation is carried out through social interaction. A leadership meta-capability is necessary for organizational adaptation in a changing environment. It is also necessary for organizational sustainability. As mentioned before, in a complex adaptive systems perspective, transactional leadership produces better results. Hazy (2005, pp 245-50) states that the level of transactional leadership activity predicts the organizations’ level of sustainability. Leader-follower relationship is a key issue that has to be properly analyzed. Works Cited Bass, B. M. & Steidlmeier, P. (1998), Ethics, Character, And Authentic Transformational Leadership, Center for Leadership Studies, School of Management, 39 Brown, A. (1994). Transformational leadership in tackling change: Journal of General Management, 19, 1-12. Conger, J. A. & Kanungo R. N. (1998), Charismatic Leadership in Organizations, Thousand Oaks, CA: Sage Publications. 119-22 Goleman, D. (2000). Leadership that gets results. Harvard Business Review, 78, 78-90. Hazy, J. K. (2005), Leadership as an Organizational Meta-Capability: A System Dynamics Simulation of Leadership, The George Washington University: 245-50 Heckscher, C., Eisenstat, R. A., & Rice, T. J. (1994) Transformational Process In Heckscher, C., & Donnellon, A. (Eds.), The post-bureaucratic organization: New perspectives on organizational change. (pp. 129-137). Thousand Oaks, CA: SAGE Publications. Hersey, P., & Blanchard, K. H. (1996) The management of organizational behavior: (7th ed.) Englewood Cliffs, NJ: Prentice-Hall. 33-35 Keller, R. (1995). "Transformational" leaders make a difference. Research-Technology Management, 38, 41-44. Robbins, S.P., Bergman, R., Stagg, I. & Coulter, M. 2003, Management, Pearson, 134-38 Sarros, JC & Santora JC (2001) “The transformational - transactional leadership model in practice.” Leadership & Organization Development Journal, Vol 22 iss7-8, p383 Smith, A. (1990). Good leaders. Business & Economic Review, 37, 10-12. Strange, JM, & Mumford, MD (2005) The origins of vision: Effects of reflection, models, and analysis. The Leadership Quarterly, 16, 121-148. Tracey, J., & Hinkin, T. (1998) Transformational leadership or effective managerial practices? Group & Organization Management, 23, 220-236. Zaleznik, A. (1992) Managers & Leaders: Are they different? In / Harvard Business Review, March/April 1992. pp 126-135. Read More