Transactional leadership is a leadership style that functions on agreements and rewards. Employees know from the get-go what is expected of them. They also know from the start what their pay or salary will be for following expected procedures.

Most of the time punishments for not adhering to instructions are not known outright with a leader that practices this style. However, transactional leaders are known for their strictness and discipline.

The decision on salary or income is decided early on once an employee decides to work for a transactional leader. Once the income is settled, the company basically obtains power over the employee.

Transactional leadership also requires the employee delegated to do a certain task to be accountable. There are no excuses allowed for not getting the job done. A transactional leader will not allow for additional resources to complete the task. Subordinates who follow through are rewarded, while those who fail are punished.

Transactional leaders are in the mindset that if things are running well and getting done, there is no problem that needs to be addressed. When a subordinate goes above and beyond what is expected, they are usually praised. On the other hand, if poor behavior is the case, then there will be some kind of method to fix the behavior.

Instead of being a leadership style that tries to sell subordinates, transactional leadership is bases on telling subordinates what to do.

Even though there has been a lot of research on the limitation of this leadership style, many managers and supervisors still choose this approach. This leadership style focuses more on management instead of leadership.

To have an ideal workplace, we can't assume that everyone is motivated by punishment and reward. The theory of behaviorism was established using animals, not humans to determine motive and human thought. I would venture to say that most people aren't as predictable as dogs.

Applying behaviorist methods to uphold transactional leadership is rather pratical for this style of leadership. In addition, it is verified through supply and demand in the workplace. On the contrary, when the supply of subordinates does no meet the demands, other leadership styles must come into the picture to be effective.

Situational Leadership

Leadership Theory

Leadership Theories