BASIS FOR TRANSACTIONAL TRANSFORMATIONAL

COMPARISON LEADERSHIP LEADERSHIP

Meaning A leadership style that A leadership style in which the
employs rewards and leader employs charisma and
punishments for enthusiasm to inspire his
motivating followers is followers is Transformational
Transactional Leadership. Leadership.
Concept Leader lays emphasis on Leader lays emphasis on the
his relation with followers. values, ideals, morals and
needs of the followers.
Nature Reactive Proactive
Best suited for Settled Environment Turbulent Environment
Works for Developing the existing Changing the existing
organizational culture. organizational culture.
Style Bureaucratic Charismatic
How many Only one More than One
leaders are there
in a group?
Focused on Planning and Execution Innovation
Motivational tool Attracting followers by Stimulating followers by setting
putting their own self group interest as a priority.
interest in the first place.
Key Differences Between Transactional and
Transformational Leadership
The following are the major differences between transactional and
transformational leadership:

1. Transactional Leadership is a type of leadership whereby rewards

and punishment are used as a basis for initiating the followers.
Transformational Leadership is a leadership style in which the leader
uses his charisma and enthusiasm to influence his followers.
2. In transactional leadership leader, is lays stress on his relationship
with followers. Conversely, in transformational leadership leader lays
stress on the values, beliefs and needs of his followers.
3. Transactional Leadership is reactive whereas Transformational
Leadership is proactive.
4. Transactional Leadership is best for a settled environment, but
Transformation is good for the turbulent environment.
5. Transactional Leadership works for improving the present conditions
of the organisation. On the other hand, Transformational Leadership
works for changing the present conditions of the organisation.
6. Transactional Leadership is bureaucratic while Transformational
Leadership is charismatic.
7. In Transactional Leadership, there is only one leader in a group. In
contrast to transformational leadership, in w
Conclusion

According to some researchers, transactional leadership is best while some

think that transformational leadership is better. So the debate is never
ending, for the two leadership styles. In my opinion, there is no standard
leadership style which is best suited to all the circumstances. So, an
organisation should not rely on a single leadership style. It must employ the
requisite leadership style as per its needs and prevalent conditions.

If you are searching for the best leadership style between transactional and
transformational leadership, then you will end up saying that both are
having its merits and demerits. It depends on the situation which leadership
style will be most appropriate to it.