Transformational vs. Transactional Leadership: A Detailed Comparison

This report provides a detailed comparison of transformational and transactional leadership styles. It begins by defining each style, with transformational leadership focusing on inspiring followers to achieve extraordinary outcomes and transactional leadership emphasizing compliance through rewards and punishments. The report then contrasts the leadership styles, examining their proactive versus reactive approaches, and their respective characteristics, such as charisma in transformational leaders versus practicality in transactional leaders. It explores their applicability to different needs (higher-order vs. lower-level), management styles, and focuses (follower development versus task performance). The report also analyzes their working methods, orientation, critical thinking approaches, planning strategies, and motivational techniques. Furthermore, it considers the commitment of staff, affective situations, limitations, and similarities to other leadership theories like Theory X and Theory Y. Finally, it references relevant studies and provides a structured APA-formatted comparison table, offering a comprehensive overview of these two important leadership paradigms.

Running head: COMPARISON
COMPARISON
Name of the Student
Name of the University
Author note

1COMPARISON
Definition
A leader who is responsible for stimulating and inspiring the followers to transform
themselves and achieve the sequel as extra-ordinary is said to be a transformational leader.
On the other hand, a transactional leader is the one who is responsible for promoting
compliance with the followers that belong to him using both the techniques of rewards and
punishments (Baškarada, Watson & Cromarty, 2017).
Type of leadership
The leadership style used by the transformational leader is proactive in nature, which
means taking or planning preventive measures of the problem beforehand. This helps in
improving the works that a team does and puts measures that are required in place.
On the contrary, transactional leaders use a responsive or reactive leadership style,
which means responding to the situations after their occurrence. There may be a chance to
fail in this kind of leadership style.
Characteristics
The transformational leaders have an extreme charismatic power and are more
focused on the fulfillment of the job. They motivate their followers by motivating and
inspiring them to achieve the desired goal.
Transactional leaders are practical and hence believe in practicality. They motivate
their followers by extrinsic type of motivation, which means that the behavior is mostly
driven by factors such as monetary rewards and praises. These leaders are mostly directive
and do not accept change very quickly and also have a thinking that is constraint.
Applicability

2COMPARISON
The transformational leadership applies to the needs of the higher-order needs that include
the self-actualization and self-esteem needs.
However, transactional leadership focus on the needs that of the lower level and that include
needs like physiological and safety needs.
Management by
The transformational leaders are responsible for inspiring the followers and works as
a role model in order to make the followers feel interested in achieving the goal that is
desired.
On the other hand, transactional leaders are responsible for finding faults and
deviations in the work by the follower by continually paying attention to them.
Focus
A transformational leader is more focused on understanding the strengths and
weaknesses of the followers and then aligning these accordingly to enhance the performance
of the followers.
Transactional leaders are more focused on supervising, organizing, and the
performance of the group.
Working
The working of a transformational leader is based on changing the future of the
organization and also making changes in the goals of the long-term.
Unnecessary risks are avoided, and things are kept the same by the transactional
leaders, and everything is followed up by the short-term goals.
Orientation

3COMPARISON
Transformational leaders are focused more on the followers they have and are mostly
people-oriented. Therefore, most of the time of these leaders is spent on the development and
coaching of the followers present.
Transactional leaders are mostly focused on the tasks given to them, which means
they are more task-oriented, and their main focus is on completion of the KPIs given to the
followers and measurement of the goals. Most of the time of these leaders is spent on the
meetings that take place (Obeidat & Tarhini, 2016).
Critical thinking and problem solving
Whenever a problem arises, the transformational leaders find out ways that are
creative by thinking out of the box always.
On the contrary, transactional leaders use the traditional ways of thinking ways inside
the box without bringing any creativity to their ideas.
Planning
The planning done by the transformational leaders includes two steps in which first is
the creation of a system that works for attaining the goals set by the organization. The second
step is about making a strategic guidance for an organization to hold a leader’s position in the
market.
There is a two-step planning for the transactional leaders as well. The first step is
about working in the system that is already existing and then negotiating for the attainment of
the goals for the organization. The second step is to make sure that whatever is planned
happens smoothly.
Motivation and inspiration

4COMPARISON
Transformational leaders inspire their followers by motivating them to put an extra
effort that is required for bringing a positive change in the organization. All these are done
through insight motivation.
On the contrary, transactional leaders believe in inspiring the followers by using the
outsight motivation techniques that include rewarding and punishing the employees based on
the job done and the fulfillment of self-interest. If any worker does a good job s/he is
rewarded, whereas punishments are generated for the negative consequences (Den Hartog,
Van Muijen & Koopman, 1997).
Commitment of the staffs
The staff or followers under the transformational leaders are highly engaged with the
work and are promotable.
On the other hand, the followers under the transactional leaders are mostly stuck at a
point and do not know of getting ahead and are pretty unsure. These staffs are generally not
promotable due to the lack of following.
Affective situation
The transformational leader is responsible for the implementation of new and creative
ideas as the accreditation and is also responsible for changing the culture of the organization.
However, the transactional leaders are applied to the situation that is facing a crisis
and is in an emergency as the application of CPR and ED (Cho et al., 2019).
Limitations
There are several limitations to transformational leadership. There is an ambiguity in
the processes and influences of these leaders. Besides, the specification of the variables that
are situational is insufficient in this kind of leadership. There is also an omission of many

5COMPARISON
behaviors in the theory of transformational leadership that is relevant. This theory assumes
the heroic leadership stereotype.
On the contrary, the limitation for the transactional leadership includes the elimination
of individuality in the process of production. The amount of innovation that can be achieved
is limited here. Besides, more emphasis is given on efficiency, and more focus is on the
consequences rather than the rewards.
Similar theory
The transformational theory is similar to Theory Y, as both theories focus on
encouraging the employees and support the ideas generated by trusting them. The required
tool is supplied to the followers for enhancing their performance.
Theory X and transactional leadership are similar as in both the cases manager rule
the employees by fear and consequences. The motivation factor is incentives in both cases.
Studies
Studies state that there is a strong correlation between the work of the employees and
the outcomes generated that includes creativity, attainment of the goals, and others in
transformational leadership.
Studies state that there is a strong relationship between the effectiveness and
transactional leadership in some of the other settings.

6COMPARISON
References
Baškarada, S., Watson, J., & Cromarty, J. (2017). Balancing transactional and
transformational leadership. International Journal of Organizational Analysis.
Cho, Y., Shin, M., Billing, T. K., & Bhagat, R. S. (2019). Transformational leadership,
transactional leadership, and affective organizational commitment: a closer look at
their relationships in two distinct national contexts. Asian Business &
Management, 18(3), 187-210.
Den Hartog, D. N., Van Muijen, J. J., & Koopman, P. L. (1997). Transactional versus
transformational leadership: An analysis of the MLQ. Journal of occupational and
organizational psychology, 70(1), 19-34.
Obeidat, B. Y., & Tarhini, A. (2016). A Jordanian empirical study of the associations among
transformational leadership, transactional leadership, knowledge sharing, job
performance, and firm performance. Journal of Management Development.

7COMPARISON
APA schedule
CRITERIA TRANSFORMATIONAL
LEADERSHIP
TRANSACTIONAL
LEADERSHIP
Definition
A leader who is responsible
for stimulating and inspiring
the followers to transform
themselves and achieve the
sequel as extra-ordinary is
said to be a transformational
leader.
On the other hand, a
transactional leader is the
one who is responsible for
promoting compliance with
the followers that belong to
him using both the
techniques of rewards and
punishments (Baškarada,
Watson & Cromarty, 2017).
Management By
The transformational leaders
are responsible for inspiring
the followers and works as a
role model in order to make
the followers feel interested
in achieving the goal that is
desired.
On the other hand,
transactional leaders are
responsible for finding faults
and deviations in the work
by the follower by
continually paying attention
to them.
Working The working of a
transformational leader is
based on changing the future
Unnecessary risks are
avoided, and things are kept
the same by the transactional

8COMPARISON
of the organization and also
making changes in the goals
of the long-term.
leaders, and everything is
followed up by the short-
term goals.
Type of leadership
The leadership style used by
the transformational leader
is proactive in nature, which
means taking or planning
preventive measures of the
problem beforehand. This
helps in improving the
works that a team does and
puts measures that are
required in place.
On the contrary,
transactional leaders use a
responsive or reactive
leadership style, which
means responding to the
situations after their
occurrence. There may be a
chance to fail in this kind of
leadership style.
Characteristics
The transformational leaders
have an extreme charismatic
power and are more focused
on the fulfillment of the job.
They motivate their
followers by motivating and
inspiring them to achieve the
desired goal.
Transactional leaders are
practical and hence believe
in practicality. They
motivate their followers by
extrinsic type of motivation,
which means that the
behavior is mostly driven by
factors such as monetary
rewards and praises. These
leaders are mostly directive

9COMPARISON
and do not accept change
very quickly and also have a
thinking that is constraint.
Applicability
The transformational
leadership applies to the
needs of the higher-order
needs that include the self-
actualization and self-esteem
needs.
However, transactional
leadership focus on the
needs that of the lower level
and that include needs like
physiological and safety
needs.
Orientation
Transformational leaders are
focused more on the
followers they have and are
mostly people-oriented.
Therefore, most of the time
of these leaders is spent on
the development and
coaching of the followers
present.
Transactional leaders are
mostly focused on the tasks
given to them, which means
they are more task-oriented,
and their main focus is on
completion of the KPIs
given to the followers and
measurement of the goals.
Most of the time of these
leaders is spent on the
meetings that take place
(Obeidat & Tarhini, 2016).
Whenever a problem arises, On the contrary,

10COMPARISON
Critical thinking and
problem solving
the transformational leaders
find out ways that are
creative by thinking out of
the box always.
transactional leaders use the
traditional ways of thinking
ways inside the box without
bringing any creativity to
their ideas.
Planning
The planning done by the
transformational leaders
includes two steps in which
first is the creation of a
system that works for
attaining the goals set by the
organization. The second
step is about making a
strategic guidance for an
organization to hold a
leader’s position in the
market.
There is a two-step
planning for the
transactional leaders as well.
The first step is about
working in the system that is
already existing and then
negotiating for the
attainment of the goals for
the organization. The second
step is to make sure that
whatever is planned happens
smoothly.
Motivation and inspiration Transformational leaders
inspire their followers by
motivating them to put an
extra effort that is required
for bringing a positive
On the contrary,
transactional leaders believe
in inspiring the followers by
using the outsight
motivation techniques that

11COMPARISON
change in the organization.
All these are done through
insight motivation.
include rewarding and
punishing the employees
based on the job done and
the fulfillment of self-
interest. If any worker does
a good job s/he is rewarded,
whereas punishments are
generated for the negative
consequences (Den Hartog,
Van Muijen & Koopman,
1997).
Commitment of the staffs The staff or followers under
the transformational leaders
are highly engaged with the
work and are promotable.
On the other hand,
the followers under the
transactional leaders are
mostly stuck at a point and
do not know of getting
ahead and are pretty unsure.
These staffs are generally
not promotable due to the
lack of following.
Affective situation
The transformational leader
is responsible for the
implementation of new and
However, the transactional
leaders are applied to the
situation that is facing a