This document discusses and compares transformational and transactional leadership theories. Transformational leadership aims to inspire followers and help them achieve higher goals, while transactional leadership involves social exchanges where followers receive rewards or punishments based on their performance. The document outlines the key components, advantages, and limitations of each leadership style, and provides examples of how each might be applied in different scenarios.

1. Theories of Leadership
Transformational vs Transactional

2. Differences
Transformational
 Transformational leadership is concerned with bringing
change to a society or organization.
 It's a style of leadership that involves stimulating and
inspiring followers in order to assist them attain
outstanding goals (Athena, 2017).
 Transformational leaders strive to empower their
followers by assisting them in realizing their own
leadership potential.
 The leaders make an effort to address and align
individual goals with those they have in mind, as well
as achieving organizational objectives.
Transactional
 Transactional leaders are those who lead by embracing
social trade in which one thing is provided in exchange
for another.
 Politicians are an excellent example of transactional
leaders, as they frequently promise jobs and other
possibilities in exchange for votes (Athena, 2017).
 Employees that display high productivity, on the other
hand, are rewarded financially and promoted by
transactional business leaders.

3. Components
Transformational
Idealized influence
 Allows the leader to act in a way that inspires others to follow suit.
 .Followers like to be connected with transformational leaders
because they gain approval from them (Brown, Brown, &
Nandedkar, 2019).
Individualized consideration
 This is when a leader considers the requirements of each and every
one of his or her followers
 One is given more encouragement, another is given more autonomy,
and yet another is given more difficult duties to complete.
Transactional
Contingent Reward
 an agreement between the follower and the leader to receive actual
benefits or the promise of a reward if the assigned work is completed
successfully (Khan, 2019).
 Contingent reward can be either transactional or transformational,
depending on whether the payoff is physical or psychological
Management by Exception
 These are classed as active or passive depending on the leader's level
of involvement.
 The leader is immediately involved in the monitoring of deviations
from defined standards while the followers are in activity, which is
known as active MBE.

4. Advantages and Limitations
Transformational
Advantages
 Turnover costs are reduced via transformational leadership.
 It's a type of leadership that involves the whole person.
 New company visions can be developed quickly
Limitations
 It lacks conceptual clarity since it encompasses a wide range of activities,
making it difficult to describe.
 leadership can readily be exploited, especially in the propagation of
immoral behavior, such as by cults.
 When it comes to motivating team members, transformational leaders have
a proclivity to train and mentor only a small number of people.
Transactional
Advantages
 This leadership style incorporates short-term planning to ensure that
management's ambitions for the firm or organization are accomplished.
 This leadership style is helpful in inspiring people to become productive and
efficient members of the team since it is based on reward and punishment.
Limitations
 Because they believe they are being ordered, followers are neither driven
nor excited about what they accomplish
 Leaders also treat their followers like persons who can be influenced by the
prospect of a reward. This exposes the worker to predictability, with both
positive and negative implications

5. Scenarios
Transformational
 Mr. Smith, the manager of a tutoring firm, finds that his
employees are not completing required paperwork on time.
He offers a brief retraining on how to fill out the
paperwork, when to fill it out, and when it is due in order.
He inquires of his coworkers as to why paperwork is not
completed on time. The majority of employees claimed
that they were not given enough time during the week to
complete paperwork. Staff members voted to set aside one
hour per week for paperwork which can be filed by email.
Over the next month, all paperwork was completed on time
and in good order.
Transactional
 Mrs. Ruth is a sports coach. She encourages her sportsmen
to be disciplined in their training. They establish a strong
desire to achieve their best in order to win awards.
Assuming that certain athletes do not have a strong desire
to improve. She will ignore them and exclude them from
international contests in that case.

6. References
 Athena, X. (2017). Transformational Leadership, Transactional Contingent Reward, and Organizational
Identification: The Mediating Effect of Perceived Innovation and Goal Culture Orientations. Frontiers
in Psychology, 1754. doi:10.3389/fpsyg.2017.01754
 Brown, M., Brown, R. S., & Nandedkar, A. (2019). Transformational Leadership Theory and Exploring the
Perceptions of Diversity Management in Higher Education. Journal of Higher Education Theory &
Practice, 19(7), 11-21. Retrieved from
https://web.s.ebscohost.com/abstract?direct=true&profile=ehost&scope=site&authtype=crawler&jr
nl=21583595&AN=141087911&h=m684sOkR7TaoFzqcWeKmgxj7Kv5b1JgDjmZa2%2fZBfmIvtl8pYl1Ilit
nAhfns9nhldi%2bAGu%2fvZRdU8GnFIcpEw%3d%3d&crl=c&resultNs=AdminWebAuth&resultLo
 Khan, N. (2019). Adaptive or Transactional Leadership in Current Higher Education: A Brief Comparison.
International Review of Research in Open and Distributed Learning, 183.
doi:https://doi.org/10.19173/irrodl.v18i3.3294