Leading and Managing in Organisations - Essay Example

The theory, exchanged the follower and the leader to take place in achieving the normal performance goals. This form of theoretical exchange involves the following dimensions, contingent rewards, active management through exception, passive management via an exception, and Laissez-faire. According to the contingent rewards, transactional leaders connect the goal of the workers to their rewards, clarify the expectations, and offer the necessary resources (Wood 1992). Inactive management by exception, the transactional theory actively monitors the subordinate's work and watches for deviation standards. Another dimension is passive management by exception. Here the theory interferes when the standards of leadership are not met.

Consequently, in Laisses-faire, the leadership theory offers an environment where the subordinate will get various opportunities in making the decision. The leaders themselves abdicate the roles and avoid carrying out decisions and the group tends to lack the decision. Some of the assumptions underlying the transactional leadership theory include; the workers are motivated by the punishment and rewards, the subordinates need to obey the guidelines from the superior, and the subordinates are not motivated (Valle 1975). They need to be controlled and monitored closely so that their work can be carried out. The implication of the transactional theory is that the leaders tend to overemphasize the short-term and detailed goals and the standard procedures and goals. They fail to make efforts in enhancing the generation and creativity of new ideas (Petri 1991). This form of leadership technique tends to work well where the problems of the organization are clearly defined and simple. The leaders believe in not rewarding or ignoring the ideas that do not confine the existing goals and plans. In this theory, transactional leaders are effective in directing effective decisions, which are meant to improve productivity, and cutting costs. These leaders are highly action-oriented and highly directive and their follower’s relationships with the followers are transitory and are based on emotional bonds. The theory assumes that subordinates need to be motivated with simple rewards. The only link between the followers and the leaders is money which the followers receive the efforts and the compliance (Sullivan 2000).  The transactional leadership theory is taken to be insufficient, but not that worse when developing the maximum potential of leadership. If forms as the foundation for interactions but care need to be underlined by the leadership style not to carry out the practice exclusively, otherwise it will result in the creation of a permeated environment by politics, perks, position, and power.

Conversely, the transformational leadership theory assumes that when the employees get to know their tasks, they get motivated. Additionally, the focus of the organization or the team tends to produce perfect and better work. The transformational leadership theory defines leadership based on how the leaders of a company affect the followers. The respective followers are meant to admire, respect, and trust the transformational leaders. The theory defines the theory in three ways based on how the leaders affect the transformers. First by raising their task value and task importance awareness, getting the employees to focus on the goals of an organization rather than focusing on their vested interest. Thirdly, by activating the needs of the higher needs. In this theory, charisma is regarded to be necessary but insufficient. For instance, the mechanism in which the charismatic actors may fail to make a leader. Some of the crucial effects that the leaders tend to achieve in evoking strong emotions and causing identification for the leaders and the followers. This is mainly through appeal. This may also happen through mentoring and coaching. Recently, the theory noted that legitimate transformational leadership is based on the grounded foundation, which is based on four dimensions. These dimensions include idealized influence, intellectual stimulation, individualized consideration, and intellectual stimulation. The three moral aspects of this theory are the leader’s characters, the ethical values that are embedded in the vision, program, and vision of a leader. Consequently, the morality of the ethical choice and action that the followers and leaders engage and collectively pursue their desires. This is in contrast to the transactional leadership theory where the in and out groups are used in bonding the followers to the leaders. This is because they are linked with higher value orders, which are originally termed amoral and attributed to transformational skills.

                        In table form, the difference between transactional leadership theory and transformational leadership theory is as shown below:

Transactional Leadership Theory

Transformational Leadership Theory

Leadership is characterized as responsive

Leadership is characterized as proactive

The theory works within the culture of an organization

 The theory works to change the culture of an organization through the implementation of new ideas

Transactional leaders make the workers attain the objective of an organization through punishment and rewards

Transformational leaders empower and motivate the workers to attain the objective of the company by appealing to moral values and higher ideals

The theory motivates the followers by appealing to their self-interest

The theory motivates the followers by encouraging   the employees to transcend their interest in the unit