In the modern business world, we can see many leadership styles. These styles evolved based on individual behavior, organizational requirements as well as the changes in the business environment. Transactional leadership is one such leadership that can be seen often in the business world. transactional leadership can be separately identified based on a few unique characteristics in the leaders.
01. External motivation
Transactional leaders expect to achieve organizational targets by providing external motivation to the employees. They encourage employees by presenting rewards when they achieve targets and when they behave expectedly. If the employee is not behaving expectedly or not achieving the expected target, he will be punished by the manager.
02. Discourage innovation
Transactional leadership discourages creativity and innovation. They expect the employees to follows the set rules and procedures. They do not encourage them to think outside the box and to come up with innovative concepts to improve the process.
03. Directive
Transactional leadership does not give any opportunity for the employees to involve in the decision-making process. They believe that all the decisions of the organization should be taken by the management of the business and the employees should simply follow the decisions and procedures created by the management.
04. Interest on hierarchy
Transactional leaders demonstrate more interest in the organizational hierarchy. They believe in treating employees based on their position in the organizational hierarchy. They place a lot of importance on creating a corporate structure in the business.
05. Emphasis on self-achievement
Transactional leaders always encourage the employee to achieve the set individual target. they do not encourage the employee for teamwork or team achievement. If the individual employee achieves a set target he will be rewarded and if he fails to achieve the target, he will be punished by the leader.
06. Rewards or punishments based on performance
Transactional leadership can be considered as rewards or punishments based leadership. Transactional leader rewards the best performing employees and punishes worst-performing employees. They believe this method as the most suitable way of motivating employees.
07. Numeric oriented
Transactional leaders focus on the numeric target achievement of the organization. They do not show much interest in the improvement of the employees and the quality of the product as long as the numerical target of the organization is achieved. They do not encourage to improve employee skills unless it is necessary to improve the numbers of organizational output.
08. Passive
Transactional leaders are always concentrated on maintaining the status quo. They react to organizational problems only when the problem occurs. They are not willing to take any action to prevent the problem. Instead, they take the necessary actions to solve the problem once it arrives.
09. Unwilling to change
There is a traditional characteristic in the transactional leadership that can be recognized as the unwillingness to change. Since the transactional leaders do not motivate innovation and creativity, they are not flexible for changes. They like to maintain regular policies and procedures without adding any modification.
10. Short term goal oriented
Transactional leaders are concentrating on short term goal achievement. Since they operate the business based on the rewards and punishments, it is important to set short term goals for the employees. Once the goal is accomplished, they set another goal for the employees to drive the organization towards the main final goal. Due to this reason, transactional leadership can be considered as one with the most practical and goals and objectives.
The above-mentioned characteristics help to identify the transactional leadership from all the available leadership style. Transactional leadership is most suitable for organizations that operate on an outcome basis and who are more concerned about achieving the statistical targets.