An Analysis of Transformational Leadership vs. Leader-Member Exchange

This essay provides a comprehensive comparison of transformational and leader-member exchange (LMX) leadership theories. It begins with an introduction to the concept of leadership and its importance in achieving organizational goals. The essay then delves into the specifics of each theory, defining transformational leadership as a style that emphasizes influencing, motivating, and empowering followers, while LMX theory focuses on the quality of the relationship between leaders and their members. The advantages and disadvantages of each theory are thoroughly examined, including the potential for positive change and clear direction in transformational leadership versus the potential for discrimination in LMX. The essay highlights the similarities and differences between the two theories, culminating in a conclusion that favors transformational leadership due to its emphasis on recognizing all participants and fostering leadership qualities among followers, ultimately promoting fairness and equal access to resources within an organization. The essay concludes by referencing several sources to support its arguments and findings.

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 1
Comparing and contrasting Transformational and Leader-member exchange Leadership theories
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COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 2
Table of content
Contents
Introduction.................................................................................................................................................3
Transformational leadership theory.............................................................................................................3
Advantages of transformational leadership theory.......................................................................................3
Disadvantages of transformational leadership theory..................................................................................4
Leader-member exchange Leadership theory..............................................................................................5
Advantages of leader- member Leadership theory......................................................................................5
Disadvantages of leader-member leadership theory....................................................................................5
Similarity between Transformational and Leader-member exchange Leadership theories..........................6
Conclusion...................................................................................................................................................6
References List............................................................................................................................................7

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 3
Introduction
Leadership is the act of providing guidance and influencing individuals to actively work
in an effective and efficient way in order to achieve a mutual set goal. It also involves controlling
and coordinating activities in an organization to realize an objective. Over the past years, various
approaches have been developed to address leadership in organizations. In response to this,
various theories have been developed to enable the success of any kind of leadership in an
organization (Şahin, Gürbüz, and Şeşen, 2017 p.105-125). In this essay two leadership theories
will be discussed, compared and contrasted to define the best theory that has the highest
capability of enabling an organization to achieve their best set objective. The selected leadership
theories in this assignment include: Transformational and leader member exchange leadership
theories. The advantages and disadvantages of the mentioned theories will also be assessed to
determine the theory that will outdo the other theory. The assignment will also make a
conclusion on the best leadership theory among the selected two theories depending on the facts
from the essay.
Transformational leadership theory
This theory was introduced in 1978 by MacGregor Burns. The theory argues that
organizational achievements are well met when leaders have strong integrated capabilities of
influencing, motivating and empowering their junior followers towards the set organization goals
(Lorinkova, and Perry, 2017 p.163). For the transformational leadership theory to occur, there
must be a leader and a group of individuals who have the zeal of being transformed from one
stage to another by using the same resources that are available in an organization. Leader’s
morals and values at work are also validated and emphasized in this theory to ensure its
effectiveness towards the organizational objectives The theory can be applied in different
departments, divisions or even teams of a particular organization. In as much as the
transformational leadership theory is praised to be the best theory that organizations embrace, the
theory has various advantages and disadvantages as outlined below.
Advantages of transformational leadership theory
Although change is inevitable in most organization, transformational leadership theory
emphasizes on leaders taking risks that in turn contributes to major positive changes to an
organization. This theory is characterized with a clear definitions concerning the direction of an
organization which enables the leaders to highly influence their followers towards a clears set

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 4
vision of the organization. According to an organization (Jyoti, J. and Bhau, S., 2015 p.21) an
organization is able to create a significant balance between the long and short term goals that an
organization intends to work towards them. In preparation to the long and short term goals,
leaders are able to device strategies that are necessary for capturing the attention of its workforce
towards the organizational visions. They can achieve this through awareness and motivating their
teams towards the visions easily (Imran, Ilyas, and Aslam, 2016.p.232-248). They can also
prepare their teams through training and development programs.
Through transformational leadership, the productivity of an organization is very high due
to the commitment of each employee in that particular organization. The application of this
theory ensures that all employees are well motivated when the leaders provide clear and well
defined goals concerning the organization’s future expectations. Transformational leadership
also plays a major role of encouraging its followers to have leadership qualities that are crucial in
the management of the organization. Individuals are able to have some degree of freedom in an
organization since their weakness are used as a pillar for encouraging them unlike in other
leadership theories whereby an individual’s weakness is used as an evidence for punishment or
low remunerations (Mullen, J., Kelloway, and Teed, 2017 p.405-412). Transformational
leadership style also enables the managers to have a high rate of retaining the organization
workforce and its potential customers.
Disadvantages of transformational leadership theory
Some of the disadvantages of this theory are that, the leaders may have their own self-
interest purposes such that they influence their fellows to adopt the changes in the organization
which may in turn affect the organization in a negative way rather than a positive way (Wang,
Kim, and Lee, 2016 p.329). This is mostly possible due to the strong trust that followers have in
their leaders.
Through this theory, the believed leaders may manipulate their followers in an effort of
trying to work with them. They may use strategies that are in a high position of violating the
rights of their followers thus affecting the followers’ morale of working towards the set
objectives of an organization. The so called followers are not self-motivated, they require their
leaders to closely monitor them so as to perform their assigned duties. In this kind of leadership,
leaders are prone to losing their power if their followers refuse to adopt to the transformational

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 5
changes. When this happens, some leaders may lose their ability of convincing their followers
and also lose their power in the process. Finally, transformational leadership theory is made up
of different leadership theories thus making it hard to be trained among leaders. It is very tricky
to train leaders to have the required aspects for managing other junior workers.
Leader-member exchange Leadership theory
This theory was developed by George B. Graen together with Mary Uhl-Bien in the late
1970s. The theory argues that for an organization to be successful in its operations, both the
leaders who are managers and workers should have better interactions and relationships
(Gutermann et al., 2017 p.299). The theory emphasizes that there must be a mutual
understanding between leaders and the employees for the benefit of the organization. In this
theory, subordinate staffs are given an opportunity of believing in themselves in such a way that
they get empowered to always improve their performance for their specified roles thus enabling
the organization to achieve their goals in an easy manner (Chen, and Wu, 2017 p. 1914). This
theory can also be applied among teams, departments or divisions. The effectiveness of this
theory depends on the level of respect, trust loyalty among other qualities. In this kind of
leadership theory, the leaders have the power of grouping their followers into different groups
(in-groups and out-group) depending on their own criteria. All the groups work together to
ensure that the objectives of the organization are always achieved as required.
Advantages of leader- member Leadership theory
Leader-member exchange Leadership theory is believed to have various advantages in an
organization. It denotes the importance of communication in an organization. Availability of
information from the top leaders fosters effective and efficient productivity of the organization
since all individuals are aware of their requirements in order to fulfil a mutual goal. This theory
is also valid and applicable in most organization since it plays a key role in appreciating the
contributions of all participants in the success of the organization (Bernerth, Walker, and Harris,
2016 p.661).
Disadvantages of leader-member leadership theory
Discrimination exists in the so called groups that are formed by the leaders (Little,
Gooty, and Williams, 2016 p.85-97). It is indicated that the in-group individuals have better
benefits of receiving much attention from their leaders and they are also not able to access

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 6
resources from the organization while the out-group individuals are discriminated in a way that
they do not receive any favors from their leaders and they receive few or no resources from their
leaders in of the organization (Herdman, Yang, and Arthur, 2017 p.1498). This kind of
discrimination may affect the profitability of an organization since the discriminated individual
may not contribute fully towards the organizational goals. Failure to involve out-groups in
decision making prevents useful ideas that could have transformed the organization to another
level (Breevaart, Bakker, Demerouti, van den Heuvel, 2015 p. 754). The theory has also received
critics because it has failed to explain the criteria that is used in selecting individuals and putting
them in either in-group or out group.
Conclusion
From the discussion above, it is clear that transformational leadership theory is more
significant than the Leader-member exchange Leadership theory. This is because,
transformational leadership theory is able to recognize all participants towards the organization
success in equal measures as compared to the leader-member exchange leadership theory which
is so selective and discriminative on its participants. In a working environment, all employees are
supposed to be treated equally so that they are motivated to contribute their efforts fully towards
the organizational objectives. Transformational leadership is able to instill leadership qualities
among their followers through training and development forums which in turn enables the
trained followers to be able to make sound decision when they face difficulties in line with their
work. This has given it the uniqueness against the leaders-member exchange theory which only
rely on the skills and competencies that their followers have. This poses a greater risk to an
organization that have a leader-member exchange leadership because they may not be able to
adopt to new innovations that require new kills and competencies.
Transformational leadership theory advocates for fairness in resource allocation. All
followers are accessible to the required resources that are required to transform an organization
rather than restricting accessibility to resources like in the leader-member exchange theory.
Accessibility to key resources enables an organization to easily achieve the intended outcomes as
compared to availing resources to the few selected who are believed to be better than the others.
All these inferences give transformational leadership the chance of being ahead and being the

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 7
best theory to be applied in many organizations due to the benefits that the theory is associated
with them.
References List
Bernerth, J.B., Walker, H.J. and Harris, S.G., 2016. Rethinking the benefits and pitfalls of
leader–member exchange theory: A reciprocity versus self-protection perspective. Human
Relations, 69(3), pp.661.
Breevaart, K., Bakker, A.B., Demerouti, E. and van den Heuvel, M., 2015. Leader-member
exchange, work engagement, and job performance. Journal of Managerial Psychology, 30(7),
pp.754.
Chen, T.J. and Wu, C.M., 2017. Improving the turnover intention of tourist hotel employees:
Transformational leadership, leader-member exchange, and psychological contract
breach. International Journal of Contemporary Hospitality Management, 29(7), pp.1914.
Gutermann, D., Lehmann‐Willenbrock, N., Boer, D., Born, M. and Voelpel, S.C., 2017. How
leaders affect followers’ work engagement and performance: Integrating leader− member
exchange and crossover theory. British Journal of Management, 28(2), pp.299.
Herdman, A.O., Yang, J. and Arthur, J.B., 2017. How does leader-member exchange disparity
affect teamwork behavior and effectiveness in work groups? The moderating role of leader-
leader exchange. Journal of Management, 43(5), pp.1498.
Imran, M.K., Ilyas, M. and Aslam, U., 2016. Organizational learning through transformational
leadership. The learning organization, 23(4), pp.232-248.
Jyoti, J. and Bhau, S., 2015. Impact of transformational leadership on job performance:
Mediating role of leader–member exchange and relational identification. SAGE Open, 5(4), p.21.
Little, L.M., Gooty, J. and Williams, M., 2016. The role of leader emotion management in
leader–member exchange and follower outcomes. The Leadership Quarterly, 27(1), pp.85-97.
Lorinkova, N.M. and Perry, S.J., 2017. When is empowerment effective? The role of leader-
leader exchange in empowering leadership, cynicism, and time theft. Journal of
Management, 43(5), pp.163.

COMPARING AND CONTRASTING TRANSFORMATIONAL AND LEADER-MEMBER LEADERHIP THEORY 8
Mullen, J., Kelloway, E.K. and Teed, M., 2017. Employer safety obligations, transformational
leadership and their interactive effects on employee safety performance. Safety science, 91,
pp.405-412.
Şahin, F., Gürbüz, S. and Şeşen, H., 2017. Leaders’ managerial assumptions and
transformational leadership: the moderating role of gender. Leadership & Organization
Development Journal, 38(1), pp.105-125.
Wang, X.H.F., Kim, T.Y. and Lee, D.R., 2016. Cognitive diversity and team creativity: Effects
of team intrinsic motivation and transformational leadership. Journal of Business
Research, 69(9), pp.329.