How to Coach Yourself and Others Essential Knowledge For Coaching | Page 495

mentioned, but they are also well-understood and formal systems of
discipline are usually in place.
The early stage of Transactional Leadership is in negotiating the
contract whereby the subordinate is given a salary and other benefits,
and the company (and by implication the subordinate's manager) gets
authority over the subordinate.
When the Transactional Leader allocates work to a subordinate, they
are considered to be fully responsible for it, whether or not they have
the resources or capability to carry it out. When things go wrong, then
the subordinate is considered to be personally at fault, and is punished
for their failure (just as they are rewarded for succeeding).
The transactional leader often uses management by exception, working
on the principle that if something is operating to defined (and hence
expected) performance then it does not need attention. Exceptions to
expectation require praise and reward for exceeding expectation, whilst
some kind of corrective action is applied for performance below
expectation.
Whereas Transformational Leadership has more of a 'selling' style,
Transactional Leadership, once the contract is in place, takes a 'telling'
style.
Discussion
Transactional leadership is based in contingency, in that reward or
punishment is contingent upon performance.
Despite much research that highlights its limitations, Transactional
Leadership is still a popular approach with many managers. Indeed, in
the Leadership vs. Management spectrum, it is very much towards the
management end of the scale.
The main limitation is the assumption of 'rational man', a person who is
largely motivated by money and simple reward, and hence whose
behavior is predictable. The underlying psychology is Behaviorism,
including the Classical Conditioning of Pavlov and Skinner's Operant
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