Analysis of Transformational and Transactional Leadership

This assignment requires an in-depth analysis of transformational and transactional leadership styles, their impact on employee engagement, and the role of leaders in promoting a positive work environment. The student is expected to critically evaluate various research papers and studies that have explored the effects of different leadership styles on organizational performance, employee satisfaction, and job engagement. The assignment also requires the student to consider the challenges faced by leaders in implementing transformational leadership and the strategies they can use to overcome these challenges. The student must provide a comprehensive summary of the key findings, discuss the implications of these findings for practice, and offer recommendations for future research in this area.

LEADERSHIP IN A CHANGING
CONTEXT
Differentiate Transformational and Transactional
leadership and lay out how the two concepts
translate into a practical work environment
Based on: Mesaieed Petrochemical
Holding Company

INTRODUCTION
 Leadership is a significant function for an organisation that helps to maximise the effectiveness of
the employees in order to meet the organisational goal. Leadership helps to initiate the action and
motivate the employees (John 2017).
 Leadership provides guidance to the employees how they need to behave within the workplace and
it helps to create confidence within the mid of the employees.
 Transactional leadership style focuses on performance, organisation and supervision of the
employees and leaders in this style try to promote their rules or compliance by giving both
punishment and rewards (Nguyen et al. 2017).
 Transformational leadership style is where the leaders also work with subordinates in order to create
the vision, inspire and recognise the changes for the team (Tyssen et al. 2014). Transformational
leadership brings utmost motivation for the team members.
 Tractional leadership style can improve the current situation, on the other side, transformational
leadership can change the recent situation.

TRANSACTION LEADERSHIP
 Transactional leadership focuses mainly focuses on outcomes that
must conform to the existing structure of the companies and it
focuses on measuring the success of the organisational system with
penalties and rewards.
 As stated by McCleskey (2014), transactional leaders have
positions and formal authority of responsibility with the
organisation. Transactional leaders always take the responsibility
of maintaining the daily routine by operating the individual
performance as well as the group performance of the team.
 As opined by (Delagche et al. 2017), transformational leaders set
some criteria for the employees with some defined requirements.
Transactional leadership is a ‘telling’ leadership style and the
leaders judge the performance of the employees.
 In tractional leadership, power comes from organisational position.
Some Transactional leaders in
business are:
Bill Gates
Vince Lombardi
Howard Schultz

TRANSACTIONAL LEADERSHIP COMPONENTS
 Transactional leaders mainly use the punishment and rewards
in order to achieve the compliance from the fellow members
of the team. Transactional leadership provides the extrinsic
motivation to the employees within a workplace by bringing
the set of compliance.
 Transactional leadership is directive and it is always action-
oriented (Dvir et al. 2015). The employees have to accept the
structure, goals and culture of the organisation set by the
transactional leaders.
 Transactional leadership has two major factors, management
by-exception and contingent rewards. Management-by-
exception checks the status-quo when the employees do not
perform well. As stated by Breevaart et al. (2014), Contingent
rewards gives rewards for recognition and effort provided for
good performance.
Components of Transactional
leadership

TRANSFORMATIONAL LEADERSHIP
As stated by Nguyen et al. (2017), transformational leadership always
encourages people to gain the remarkable results and unexpected
outcomes within the workplace. Within an organisation,
transformational leadership provides the employees autonomy over
a work and this leadership also gives authority to the employees to
take decision.
Transformational leaders are quiet leaders and they set examples for
the fellow subordinates. Transformational leadership style is
associated with the empathy, rapport and inspiration that help the
subordinates to engage in the work process (Delagache et al. 2017).
As opined by Storm et al. (2014), Transformational leadership
provides intrinsic motivation and this leadership style possesses
with confidence, courage and willingness to work hard for greater
good..
Some Transformational
leaders in business are:
Steve Jobs
William Edwards Deming
Peter Drucker
Mark Zuckerberg

COMPONENTS OF TRANSFORMATIONAL LEADERSHIP
 As stated by Antonakis and House (2014), transformational leadership has four essential components for the
implementation of this leadership within the organisation.
 Leaders can influence the subordinates by maintain the trust and by gaining the confidence of them. The
employees gain faith within the leadership and they can show empathy towards the leaders (Birasnav 2014).
 Transformational leadership provides inspiration to the employees and this type of motivation is basically
intrinsic motivation. The leaders draw the vision amongst the employees work together within the
workplace.
 These leaders provide intellectual stimulation to the team members by supporting creativity and
innovation. This supports challenging nature of work, concepts and beliefs (Renko et al. 2015).
 Lastly, transformational leaders show a personal interest in each of the subordinates work under them and
they provide both professional and personal support by assisting the professional development.

DISTINGUISH BETWEEN TRANSACTIONAL AND
TRANSFORMATIONAL LEADERSHIPS
Transactional leadership Transformational leadership
This type of leaders relies on standard forms of rewards,
punishment and inducement and sanction in order to control
the staffs.
This type of leaders arouses emotion that provides intrinsic
motivation.
This leadership provides a link between reward and effort. This leadership is proactive and it provides new opportunities
for the employees.
This leadership is responsive and the leaders deal with recent
issues.
This leadership provides special focus on intellectual
stimulation and personal issues.
This type of leaders set the goals to have desired performance. This type of leaders creates opportunities for learning to solve
the issue.
This leadership is data oriented and it is short-term. This leadership motivates the employees beyond the self-
interest.
This leadership reacts to issues This leadership reacts before it becomes problematic

OVERVIEW OF MESAIEED PETROCHEMICAL
HOLDING COMPANY
 Mesaieed Petrochemical Holding Company is a Qatar based company and it operates
in petrochemical sector. This organisation holds 49% of the issued share capital of each
of Qatar Chemical Company Limited and Qatar Chemical II Ltd and it has 55% share in
Qatar Vinyl Company. The combination of these companies makes successful operating
with world class production facilities in Qatar (Mphc.com.qa 2018).
 Mission statement:
 Increase business portfolio through gaining efficiency and capital investment that will
result to significant increase in capacity of production and widening the product ranges
 Vision:
 MPHC is committed to be globally recognised as world-class provider in petrochemical
and other complementary industries with environment consideration to sustain profitable
growth in order to increase shareholder’s return and capital value.
 Share price of the organisation has been low in last three months 0.42%. This
organisation has been the biggest Qatari organisation in last five years. Mesaieed went
public in February 2018 and it raised $880 million (Mphc.com.qa 2018).

RIGHT APPROACH FOR LEADERSHIP IN
MESAIEED PETROCHEMICAL
 Mesaieed Petrochemical is managed by Board of Directors and
this Board of Directors has group of members.
 Senior leaders of the organisation are mixed of seniors
international managers and their powerful leadership helps the
organisation to touch the success. The middle and lower
management of the organisation consist of professionals who
have expertise in cultural and professional background.
 Chairman Mesaieed Petrochemical Holding Company is
Ahmad Saif Al-Sulaiti
 Vice Chairman of the organisation is Mohamed Salem Alyan
Al-Marri
 Managing Director is Khalid Mohammed Al-Subaey
Chairman Mesaieed Petrochemical Holding
Company is Ahmad Saif Al-Sulaiti
Vice Chairman of the organisation is Mohamed
Salem Alyan Al-Marri

RIGHT APPROACH FOR LEADERSHIP IN MESAIEED
PETROCHEMICAL
 Mesaieed Petrochemicals is led by the Transactional
leaders who are veterans and who have extreme expertise
in the field. The senior leaders play an important role in
contingent reward as the management has been providing
the rewards to the employees.
 The management of Mesaieed Petrochemicals is active
by exception (Mphc.com.qa 2018). The leaders can
anticipate the issues and they monitor the problems and
they can corrective measures as well.
 Leaders in this organisation reward the employees who
are motivated with self-interest (Breevaart et al. 2014). In
Mesaieed Petrochemical, the leaders have unambiguous
and they require repetitive tasks. The leaders help the
organisation to have short-term goals in quick basis.
 Mesaieed Petrochemicals takes transactional leadership
approach framework as there are many general styles.
Implication of Leadership
• Managers in the organisation focus on
Short-term goals
• Thrive on rules and doing the measures
correctively
• Tend to be inflexible
• Very much favour structured
procedures and policies
• Opposed to change

APPLYING THE KNOWLEDGE IMPLEMENTING
TRANSACTIONAL LEADERSHIP ON HR
DEPARTMENT
Transactional leadership provides high performance in jobs and employees get motivated to present
ideas from level of efficiency. In HR department, HR has to follow rules to manage the employees
within the organisation (Deichmann and Stam 2015).
In Mesaieed Petrochemicals, HR leaders can follow the transactional leadership in order to make the
employees speak in same language.
The employees of the organisation need to learn to fulfil the requirements first and then they can do
the work very easily (Renko et al. 2015).
Transactional leadership style does not provide extensive training to the employees and transactional
leadership approach is easy to follow and it can apply in the HR with in short-term in Mesaieed
Petrochemicals .
.

APPLYING THE KNOWLEDGE IMPLEMENTING
TRANSACTIONAL LEADERSHIP ON HR
DEPARTMENT (CONTD...)
Personnel administration is checked by the HR of the
organisation. Transactional leadership style is
similar to the administrative function that needs to
be handled by the personnel department in Mesaieed
Petrochemicals.
Transactional matters are associated to the benefits of
the administration. Workplace policies and investing
workplace problems can be process-oriented matters
(Renko et al. 2015).
This leadership needs to make a structure and
responsibilities for the employees. The employees
may feel the conflict of interest in Mesaieed
Petrochemicals .
According to Delegach et al. (2017), Transactional
leaders share the matter what they conceptualise the
strategic direction.
 Implication of Transaction
leadership in HR department
• Hybrid structure may create within the
workplace
• It will focus on short-term objectives
• It can decrease the innovation to follow
routine
• The organisation needs to understand
between transactional HR and strategic
HR

APPLYING THE KNOWLEDGE IMPLEMENTING
TRANSFORMATIONAL LEADERSHIP ON HR DEPARTMENT
HR department can perform transactional tasks so that it can
get administrative support. In petrochemical industry, the
employees have to work extensive to meet the organisational
needs in Mesaieed Petrochemicals.
Therefore, transformational leadership style can be appropriate
to provide intrinsic motivation. HR department usually
collects the strategic information of the industry as well as
the employees and organisation can obtain the highest
productivity (Strom et al. 2014).
HR leaders can improve the motivation and morale of the
employees through providing best possible remuneration and
interest of working in Mesaieed Petrochemicals.
Absenteeism can be improved through employee-related
transactional function (Deichmann and Storm 2015).
Implication of Transaction
leadership in HR department
Motivates the team members
and it can open new
possibilities
HR department will bring
innovation
Better working system can be
implemented
The leaders can layout the
vision of the organisation

IMPLEMENTING TRANSACTIONAL ON DEPARTMENT
MARKETING AND SALES DEPARTMENT
 Leaders can aim to use the contingent rewards approach in order to motivate the employees and
leaders in Marketing and Sales will set the departmental goals in order to ensure the regular
monitoring process in Mesaieed Petrochemicals.
 Leaders with transactional leadership can facilitate good working procedure and it can create good
working environment through taking affair play approach. Transactional leadership gives the benefits
of checking the international relations to achieve the organisational goals.
 Feedback structure and regular reporting are some of the characteristics that can be implemented in
Marketing and Sales (Tyssen et al. 2014).
 Marketing and Sales team can have better control over team to regulate and define the duties and
responsibilities.
 Leaders show resistance to change when they take any decision inside a team of marketing and sales
(Breevaart et al. 2014).

IMPLEMENTING TRANSFORMATIONAL
LEADERSHIP ON MARKETING AND SALES
DEPARTMENT
 Transformational leadership does not create any strict rules for the team
members and it thrives with procedures and guidelines.
 The leaders can motivate the foreign employees when the prime motivation
comes from expatriates with monetary benefits.
 In Mesaieed Petrochemicals, Marketing and Sales, flexibility in timings leads
to provide more rewards to the employees.
 Transformational leadership allows employees to have motivation through
professional developmental plans (Breevaart et al. 2014).
 Long-term marketing and sales strategies can be made through the
transformational leadership styles .
 Self management and ability to take right decision are some of the features that
these leaders show in marketing and sales team (Tyssen et al. 2014).
 Marketing and sales team needs to identify changes, creates a vision and
executing the change for right direction in Mesaieed Petrochemicals.

CHALLENGES AND BENEFITS OF TRANSACTIONAL
LEADERSHIP
Challenges
 Rewards are given in practical level, such as
fringe benefits and money. All are extrinsic
motivation
 The employees’ creativity gets limited
 It does not motivate the intrinsic factor of the
employees
 In multicultural management, this leadership
can pose threat (Storm et al. 2014)
 Employees’ development
Benefits
 This leadership provide reward to those
who are motivated
 It provides a system to do the repetitive
works and it provides unambiguous
structure (Tyssen et al. 2014)
 It helps to gain short term objectives
 It provides penalties and rewards to the
employees

CHALLENGES AND BENEFITS OF
TRANSFORMATIONAL LEADERSHIP
Challenges
 Transformational leadership is not
effective in initial stage
 This requires an existing structure to solve
the issue
 In bureaucratic structure, it does not fit
well (Nguyen et al. 2017)
 Transformational leaders appeal to group
employees who can opt for organisational
success
Benefits
 It provides excellent communication ideas
 This leadership can balance long-term
goals and short-term vision (Birasnay
2014)
 Strong coalition among the team members
and mutual trust is established through this
 This leadership style has high emotional
intelligence

CRITICAL ANALYSIS
 Both Transactional and Transformational styles of administration have their
own arrangement for usage in any associations.
 Transactional style of leadership is discovered most appropriate for multi-
national concentrated on stringent timetables; strict consistence to methodology
and procedures in Mesaieed Petrochemical.
 Such style of authority from time to time neither bolsters activity, advancement
and innovativeness nor is known to center around the expert improvement of
groups or connections (Birasnav 2014).
 This leadership is, generally, is centered on an exchange based relationship
where administrations offered are properly remunerated through money related
advantages. According to McCleskey (2014), transformational leaders are
known to impact their groups through individual impacts and customized regard
for representatives.

CRITICAL ANALYSIS (CONTD…)
 Transformational leaders can plan to rouse their groups with to match up hierarchical objectives
with the individual objectives of each colleague.
 They advance development, inventiveness and adaptability among the groups and bolster colleagues
through positive input in Mesaieed Petrochemical.
 Rather, absence of checking may bring about wellbeing related episode conveying genuine
repercussions for life safety and business coherence.
 Similarly, appropriation of Transactional authority style in energetic and quick paced situations will
be unable to deliver wanted outcomes inferable from the business necessity requesting greater
adaptability, decentralization and control. (John 2017)
 Mesaieed Petrochemical follows mainly transactional leadership where the goals are set by the
leaders.

CRITICAL ANALYSIS, EXERTION OF POWETR
Unforeseen reward administration negatively affects the execution of the employees.
Moreover, look into. The level of unforeseen reward leadership is subject to
authoritative setting and workplace (Strom et al. 2014).
The punishments, granted in such an arrangement of overseeing by special case,
negatively affect execution and fulfillment in Mesaieed Petrochemical if the leaders
take this strategy. This stems from the reality the pioneer latently anticipates issues
before making any move.
By following this technique, the pioneer guarantees that remedial move is made when
required and in doing as such he strengthens the parts and desires for the adherents.
Thus, this conduct speaks to a vital part of transactional leadership (Dvir et al.
2016).
In Mesaieed Petrochemical, transactional leaders make use of the coercive power and
rewards and if the organisation is going to use the transformational power, they can
use referent power. In this organisation, the employees are given rewards, the
employees are taking extra initiative to make the organisation successful.

CRITICAL ANALYSIS, EXERTION OF POWER
(CONTD…)
The transformational style of initiative has a positive connection with group execution.
Execution of failing to meet expectations units can, in this way, be enhanced by giving the
correct type of initiative preparing to the directors of these units.
The degree of transformational administration characteristics showed by a pioneer has
coordinate effect on hierarchical working. (John 2015) One of the angles in which a
transformational pioneer impacts an association's rationalities, incorporates fulfillment of
subordinates with their leaders in Mesaieed Petrochemical.
The transformational leadership can not just bring about changing the impression of
administrators, according to their subordinates, however it can likewise help enhance the
subordinates' own sense of duty regarding the association while enhancing execution
(Breevaart et al. 2014).
Target’s perception is the matter that can be taken into account in order to describe the coercive
power. If the employees in Mesaieed Petrochemical face fear of losing the job and feel
demotivated, they can become unproductive.

CONCLUSION
Leaders use different types of leadership styles within a workplace to build the
work environment. Leaders’ behaviour helps to build morale within the
workplace.
In addition, numerous representatives working in these quick paced conditions
are inspired with the level of achievement and acknowledgment and not the
money related advantages alone.
Mesaieed Petrochemical can shift their leadership to transformational leadership
as it is an excellent medium to communicate the ideas. It is good to balance the
short-term vision.
Mesaieed Petrochemical will have the emotional intelligence and integrity
through transformational leadership.
Transactional leaders are receptive; transformational pioneers are proactive.
Transactional leaders’ bids to the self-enthusiasm of people, while the
transformational style organizes gather advance.
Once the structure and the prerequisites are found out, it is simple for laborers to
finish undertakings effectively. This works on the grounds that transactional
leader is easy to learn and does not require broad preparing.

REFERENCE LIST
 Antonakis, J. and House, R.J., 2014. ‘Instrumental leadership: Measurement and extension of transformational–transactional
leadership theory.’ The Leadership Quarterly, 25(4), pp.746-771.
 Banks, G.C., McCauley, K.D., Gardner, W.L. and Guler, C.E., 2016. ‘A meta-analytic review of authentic and
transformational leadership: A test for redundancy.’ The Leadership Quarterly, 27(4), pp.634-652.
 Birasnav, M., 2014. ‘Knowledge management and organizational performance in the service industry: The role of
transformational leadership beyond the effects of transactional leadership’. Journal of Business Research, 67(8), pp.1622-
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CONTD…
 Mphc.com.qa. 2018. Board of Directors | MPHC. [online] Available at:
https://www.mphc.com.qa/en/about-mphc/board-directors [Accessed 27 Feb. 2018].
 Nguyen, T.T., Mia, L., Winata, L. and Chong, V.K., 2017. ‘Effect of transformational-leadership style
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