Comparison of Transformational Leadership and Leader-Member Exchange Theory

This report compares the Transformational Leadership theory and the Leader-Member Exchange (LMX) theory, highlighting their unique features, advantages, and disadvantages. It concludes that Transformational Leadership theory is more effective in creating a good working environment and increasing employee efficiency, ultimately leading to business growth.

LEADERSHIP ESSAY

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
TASK 1............................................................................................................................................3
Essay Comparing Two Leadership Theory.................................................................................3
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
Leadership is the task by which manager or leader tries to influence the work of the subordinate
to achieve the long term organisational goal. Transformational leadership theory and Leader-
member exchange theory are the two theory which has evolved in the past years which explain
the different way to influence the work of the subordinates. These reports explains about the both
the theories and than compares the feature of both the theory which are offered by the theory to
the organisation. Then the reports goes on to explain about the different advantages and
disadvantages offered by the theories in the different business situation and in the end report
shows the summary of the content.
MAIN BODY
TASK 1
Essay Comparing Two Leadership Theory
In today's world leadership is known as a very important part for the organisation to
achieve the goal effectively and efficiently. As the style of leadership is evolving with the
passing time there are many theories of leadership which has also evolved, Transformational
leadership theory and Leader-member exchange theory are the two of them which has gained a
good name (Antonakis, 2017). Transformational leadership theory explains about the leadership
style in which leaders works with the subordinate to ascertain the require change and then try to
influence the change through the inspirational or motivational tools such as rewards, promotion
and incentive on completion of the task on the other hand Leader-member exchange theory
explains about the leadership style in which leader divide the team in two group one which
comprise of favoured employee and other is of unfavoured employee, leaders provide different
facilities to both of the group to work on also provides the different resources and instruction to
work with (Western, 2019).
It is very difficult for the manager to select any one out of these theory as in the world
there are many different opinion on these theory, some leaders uses Transformational leadership
theory and some uses Leader-member exchange theory depending upon the market and situation
of their organisation as both Transformational leadership theory and Leader-member exchange
theory are very unique from each other as Transformational leadership theory looks at a
emotions, ethics and value of the employee in their leadership style on the other hand Leaders
member exchange theory looks at the relationship between the employee and the leaders (Grint,
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2016). As both the theory looks at a very important aspect of the organisation hence both the
theory are important in different situation of the organisation, So comparing between these two
theory will help the organisation to understand the need of the theory according to the situation
demands in advance. Transformational leadership theory looks at building a good motivation
level among the employee to achieve the organisational goal but on the same end Leader-
member exchange theory also focuses on improving the efficiency of the employee but by
implicating two to three different sort of instruction in the single team (Northouse, 2017).
Leader-member exchange theory focuses on delegating the responsibilities according to the
quality of the employee skill, resources for work to be done are also provided on the basis of
quality of the employee but on the other hand Transformational leadership theory assumes all the
employee at the same efficiency level which in reality is not a correct way to look at employee as
every employee has different skill on a long run (Hoch and et.al.), 2018). Transformational
leadership theory focuses on building a good working environment in the organisation by
motivating the employee to achieve the goal of the business but on the other hand sometime
Leader-member exchange theory creates a conflict in the employee as there are different
treatment for the different group which creates a seance of uncertainty among the employee of
the different group and also makes employee unhappy towards the leader of the team.
Transformational leadership theory requires a agreement of all the employee for the common
vision in the team which sometimes overshadows the vision of some employee in the team whoo
has different thoughts but on the other end in the Leader-member exchange theory agreement of
all the employee are not required as different instruction are given to different section of the
group which helped the employee to clarify the work to be complete (Ghasabeh, 2015).
Transformational leadership theory focussed on the change oriented leadership style as the style
used in these theory tries to influence the work of the team if there is any change in the working
of the team but on the other hand Leader-member style of the employee focussed on the decision
oriented leadership style as the leaders take the decision according to the quality and relationship
with the employee (Aga, 2016).
There are many advantages which are offered by the theories to the organisation in
different situation such as in the situation where there is change in the technology in the
business, change in technology always result in declining the motivation level of the employee as
many of them are not able to cope up with the new technology at that point of time
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Transformational leadership theory helps the organisational to increase the motivational level of
the employee by using different motivation tool as in the Leader-member exchange theory it will
be difficult for the leader to make a change in the group according to the new technology and
instruct them accordingly as there are two different sort of group in the team (Boamah, et.al.,
2018). In the situation of employee turn around, Transformational leadership theory is good as
with the help of these style leaders creates a good trust and faith among the employee, as the
reason employee does not leave the job more frequently which helps the organisation to cut
down the employee turn over cost. In the situation of low productivity, low productivity situation
always occurs due to the ineffectiveness of the employee in these situation leader manager theory
is proves much better for the company as with the help of that theory company can implicant the
different instruction on the employee which are not able to work properly as in the
Transformational leadership theory all the employee are rated same so difficult to implicate the
decision for only few employee in the organisation (Martin and et.al., 2016). In the situation of
Conflict in the company, Transformational leadership theory is the better as in these theory
employee has the trust on the leader which helps the leader to listen the conflict and resolve it as
soon as soon as possible on the other hand in the Leader-member exchange theory it is difficult
to resolve the conflict in these theory different group are made of favoured and non favoured
employee and there are always conflict between them to impress the leaders. Their are some sort
of disadvantages also which are offered by the theories to the organisation such as it requires a
proper communication between the employee and leaders to carry out the task which has been
guided by the leaders in both the theory and if leader is not able to communicate properly with
the employee than it can harm the working environment of the organisation (Breevaart and et.al.,
2015). It sometimes creates a problem for the leaders in decision making, In the
Transformational leadership theory the team work as a common unit and works to achieve the
common goal of the business and if in case the vision of the team is not as same as of leader it
create problem for the leader to take the decision. Leader-member exchange theory can create a
conflict between the employee as different group are treated in different ways which crests the
uncertainty in the mind of the employee and can be reason of the conflict in the organisation,
sometimes it also makes the employee unhappy toward the leader (Gooty, 2016). As Leader-
member exchange theory focuses on the individual relationship between employee and leaders, it
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fails to pass on the relationship to group dynamic hence the result of it has to be suffered by the
organisation in the long run of the business (Day, 2015).
After going through the above content it has been observed that both Transformational
leaders theory and Leader-member exchange theory has very unique features of themselves to
offer to the organisation's and can be helpful for the business in different situation. Both the
theories are having several of advantages and disadvantages to offer to the organisation also but
in the end it has been summarised that Transformational leaders theory is much better for the
organisation as it helps the business to prevail there employee for the long period of time and
also helps the business to increase the efficiency level of the employee which eventually result in
increase in the growth of the business (Western, 2019).
CONCLUSION
Above report shows that both Transformational leadership theory and Leader-member exchange
theory is good for the business in the different business situation as both the theories covers a
variety of aspect of the organisation but after going through all the Advantages, Disadvantages
and features of both the theory it was understand that Transformational leadership theory is
some how better than Leader-member exchange theory as it offers good working environment
and increases efficiency level of the employee.
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REFERENCES
Books and Journals
Antonakis, J. and Day, D.V. eds., 2017. The nature of leadership. Sage publications.
Western, S., 2019. Leadership: A critical text. SAGE Publications Limited.
Grint, K., Jones, O.S. and Holt, C., 2016. What is Leadership. The Routledge Companion to
Leadership, p.3.
Northouse, P.G., 2017. Introduction to leadership: Concepts and practice. Sage Publications.
Hoch, J.E. and et.al., 2018. Do ethical, authentic, and servant leadership explain variance above
and beyond transformational leadership? A meta-analysis. Journal of Management. 44(2).
pp.501-529.
Ghasabeh, M.S., Soosay, C. and Reaiche, C., 2015. The emerging role of transformational
leadership. The Journal of Developing Areas. 49(6). pp.459-467.
Aga, D.A., Noorderhaven, N. and Vallejo, B., 2016. Transformational leadership and project
success: The mediating role of team-building. International Journal of Project
Management. 34(5). pp.806-818.
Boamah, S.A. And et.al., 2018. Effect of transformational leadership on job satisfaction and
patient safety outcomes. Nursing outlook. 66(2). pp.180-189.
Martin, R.and et.al., 2016. Leader–member exchange (LMX) and performance: A meta‐analytic
review. Personnel Psychology.69(1). pp.67-121.
Breevaart, K. and et.al., 2015. Leader-member exchange, work engagement, and job
performance. Journal of Managerial Psychology. 30(7). pp.754-770.
Gooty, J. and Yammarino, F.J., 2016. The leader–member exchange relationship: A multisource,
cross-level investigation. Journal of Management. 42(4). pp.915-935.
Day, D.V. and Miscenko, D., 2015. Leader-member exchange (LMX): Construct evolution,
contributions, and future prospects for advancing leadership theory. The Oxford handbook
of leader-member exchange, pp.9-28.
Online
TransformationalLeadership advantages and disadvantages, 2018: https://brandongaille.com/22-
advantages-and-disadvantages-of-transformational-leadership/
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