TRANSACTIONAL, CHARISMATIC AND TRANSFORMATIONAL LEADERSHIP:Visionary Leadership

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Leadership & Team Management MGMT 623

Lesson 11

TRANSACTIONAL, CHARISMATIC AND TRANSFORMATIONAL LEADERSHIP

Effective leaders don't use a single style; they use many different styles and make adjustments based on

the situation. An important but often overlooked contingency variables is national culture

New Approaches of Leadership: following are the new approaches of leadership;

1. Transactional

2. Charismatic

3. Transformational

First of all we need to understand the difference between Transactional and Transformational

leadership. After this, we will be discussing the Charismatic leadership.

1. Transactional Leadership:

These types of leaders focus on rewards in exchange for motivation, productivity and effective task

accomplishment.

2. Transformational:

These types of leaders focus on influencing attitudes and assumptions of staff. Building commitment to

the mission and always try to achieve the objective of the organisation.

Transactional leaders differ from transformational leaders

Most of the leadership theories presented in this chapter address the issue of transactional leaders.

· These leaders guide or motivate their followers in the direction of established goals by

clarifying role and task requirements.

· Transformational leaders inspire followers to transcend their own self-interests for the good of the

organization and are capable of having a profound and extraordinary effect on his or her followers.

· Transformational leaders pay attention to the concerns and developmental needs of individual

followers; they change followers' awareness of issues by helping those followers to look at old

problems in new ways; and they are able to excite, arouse, and inspire followers to put out extra

effort to achieve group goals.

· Transactional and transformational leadership are not opposing approaches.

· Transformational leadership is built on transactional leadership.

· Transformational leadership produces higher levels of employee effort and performance.

· It is more than charisma.

· The transformational leader will attempt to instill in followers the ability to question not only

established views but eventually those established by the leader.

· The evidence supporting the superiority of transformational leadership over the transactional

variety is overwhelmingly impressive.

· In summary, the overall evidence indicates that transformational leadership is more strongly

correlated with lower turnover rates, higher productivity, and higher employee satisfaction.

Differences:

Categories

Transactional

Transformational

Rank, position

Character, competence

Leader's source of power

Compliance

Commitment

Follower reaction

Short term

Long term

Time frame

Pay, promotion, etc.

Pride, self-esteem, etc.

Rewards

Important

Less important

Supervision

Evaluation

Development

Counseling focus

Leadership & Team Management MGMT 623

Charismatic Leadership:

Charismatic leaders have a combination of charm and personal magnetism that contribute to a

remarkable ability to get other people to endorse to their vision and promote it passionately.

Charisma Defined: Charisma has been defined various ways. Charisma is a Greek word meaning

"divinely inspired gift". In leadership, charisma is a special quality of leaders whose purposes, powers,

and extraordinary determination differentiate them from others.

Charisma: A Relationship: Key to charismatic leadership is the interaction between leader and group

members. Charismatic qualities must be attributed to the leader by group members and Charismatic

leaders use impression management to cultivate their relationships with group members.

· Charismatic leadership theory is an extension of attribution theory.

· It says that followers make attributions of heroic or extraordinary leadership abilities when they

observe certain behaviors.

· Several authors have attempted to identify personal characteristics of the charismatic leader.

Robert House has identified three: extremely high confidence, dominance, and strong

convictions.

· Warren Bennis found that they had four common competencies: they had a compelling vision

or sense of purpose; they could communicate that vision in clear terms that their followers

could readily identify with; they demonstrated consistency and focus in the pursuit of their

vision; and they knew their own strengths and capitalized on them.

· Jay Conger and Rabindra Kanungo at McGill University--charismatic leaders have an

idealized goal that they want to achieve and a strong personal commitment to that goal; they are

perceived as unconventional; they are assertive and self-confident; and they are perceived as

agents of radical change rather than as managers of the status quo.

There is an increasing body of research that shows impressive correlations between charismatic

leadership and high performance and satisfaction among followers.

· Charismatic leadership may be most appropriate when the follower's task has an ideological

component.

· Second, charismatic leaders may be ideal for pulling an organization through a crisis but

become a liability to an organization once the crisis and the need for dramatic change subside.

Trait of a Charismatic Leader:

Self-confidence

A vision

Strong conviction in that vision

Out of the ordinary behavior

The image of a change agent

Followers feelings towards

Charismatic Leaders

High Trust

Obedience

Emotional involvement

Satisfaction

Self-esteem

Motivation

Belief in likeliness of success

Leadership & Team Management MGMT 623

Two Types of Charismatic Leaders:

Visionary Leadership:

Visionary leadership goes beyond charisma. Visionary leadership is the ability to create and

articulate a realistic, credible, attractive vision of the future for an organization or organizational

unit that grows out of and improves upon the present.

A vision differs from other forms of direction setting in several ways:

· "A vision has clear and compelling imagery that offers an innovative way to improve, which

recognizes and draws on traditions, and connects to actions that people can take to realize

change."

· Vision taps people's emotions and energy.

The key properties of a vision seem to be inspirational possibilities that are value centered,

realizable, with superior imagery and articulation.

· Visions should be able to create possibilities that are inspirational, unique, and offer a new

order that can produce organizational distinction.

· Desirable visions fit the times and circumstances and reflect the uniqueness of the organization.

· People in the organization must also believe that the vision is attainable.

Crisis-Based Charismatic Leaders:

The crisis-produced charismatic leader communicates clearly what actions need to be taken and what

their consequences will be in the crisis.

Transformational v. Charismatic Leaders: Some experts say yes, transformation and charismatic are

same but emerging view is that:

Charisma is distinct from transformational leadership

A personal trait that might help transform, or might just help the leader

Charismatic leadership might have opposite effect -- creates dependence, not empowerment

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