June 21, 2024

Transactional and Transformational Leadership Styles

Transactional & Transformational leadership styles

Transformational and Transactional leadership styles are among the other popular styles which attracted researchers and this post is to share some details of both leadership styles as leadership is one of the important skills for construction project leaders.

For years, many researchers spend their time studying different leadership styles. However, still, it appears as a complex topic. According to Walker, leadership is also a skill that is connected with a person’s cognitive & psychological development (Walker, 2017). But, Vroom & Jago suggests leadership as a process. According to them, leadership is a process that helps in motivating the team members to achieve any goal by enhancing collaboration ( Vroom & Jago, 2007).

Transformational and Transactional leadership styles are among the other popular styles which attracted researchers. Some believe both of these leadership styles are the same, but others believe it is not. This discussion is about Transformational and Transactional leadership styles (Odumeru & Ifeanyi, 2013).

Transactional and Transformational leadership styles

There is an authoritative leader in transactional leadership, who sets specific parameters, rules and guidelines that employees need to follow. job performance is more vital than treating the employees, for transactional leaders, (Russell, 2011). Further, Transactional leaders tend to reward or punish their subordinates according to their job performance (Odumeru & Ifeanyi, 2013). Therefore, this leadership style is most suitable for a structured environment where there are defined roles and established processes set in order to achieve a specific task (Pratt, n.d.). This leadership style is suitable for leaders to achieve short term goals quickly. However, it doesn’t inspire the subordinates nor improve their creativity which is a disadvantage (Pratt, n.d.).  

In the Transformational leadership style, Employee wellbeing is the most important thing for the transformational leaders. They believe that if they treat their employees well and take care of them, then they will feel like a part of the team. As a result, the organization can achieve increased productivity (Russell, 2011). In general, transformational leaders are mostly energetic and enthusiastic (Odumeru & Ifeanyi, 2013).There are four components of transformational leadership which are intellectual stimulation, individualized consideration, inspirational motivation and idealized influence (Cherry, 2020).  

Is it possible for a leader being both?  

When comparing both leadership styles, it is obvious that both of these leadership styles have their features. Both pros and cons of each style define when to use the specific leadership style. From my experience, I believe this depends on the situation and task. Therefore, a leader can follow both styles depending on the nature of the task they are involved in.

In a construction company I worked for before, I remember a director who always assigns targets for project teams to achieve. If they achieve the specified target, for example, save some amount of money from the allowed budget, the project team received a percentage of the savings. Here it is transactional leadership. At the same time, he used transformational leadership for the employees who work under his direction which involved in the preparation of contract documents and cost details for the projects. Therefore, I believe a leader can utilize the advantages of both these leadership styles depending on the task and goal to achieve.


Transactional & transformational leadership styles are two different styles that have both pros and cons. Individual leadership style may bring benefits for business situations depending on its nature. A leader needs to understand how to strategically use these leadership styles to achieve benefits for their organizations.


Cherry, K. (2020). Transformational Leadership. Verywell Mind.  https://www.verywellmind.com/what-is-transformational-leadership-2795313

Odumeru, J. & Ifeanyi, G. (2013, June). Transformational vs. transactional leadership theories: Evidence in literature. International Review of Management and Business Research (2)2. http://www.irmbrjournal.com/papers/1371451049.pdf

Pratt, M.K. (n.d.). transactional leadership. Techtarget.https://www.techtarget.com/searchcio/definition/transactional-leadership

Russell, E. (2011, September 8). Leadership theories and style: A transitional approach. Military Leadership Writing Competition.

Vroom, V. H., & Jago, A. G. (2007, January). The role of the situation in leadership. American Psychologist, 62(1), 17 – 24.  http://web.mit.edu/curhan/www/docs/Articles/15341_Readings/Leadership/Vroom_Jago_2007_The_role_of_the_situtation_in_leadership.pdf

Walker, S. (2017). What Makes a Leader, is it Skills, Traits or Behavior?.  PennState. https://sites.psu.edu/leadership/2017/05/28/what-makes-a-leader-is-it-skills-traits-or-behavior/

Also read: Leadership Theories for Construction Project Leaders

Amila Gamage

Amila Gamage is the founder of Sihela Consultants and Builtlogy digital magazine. Her experience in the construction industry is over 17 years specializing in contract management. She is also an ACLP certified trainer in Singapore and conducts workshops and training sessions on related topics.

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