In the increasingly complex business environments, today more people recognise the role of leadership in a company’s success. Scholars have long argued what makes an individual an exceptional leader and proposed several approaches to leadership.
There are certain well-recognised attributes of leadership that if applied effectively will help me be a better leader. Leaders are often described as authoritative, passionate, charismatic, and have a certain vision of how things should be done. These qualities are connected with their role, which is to manage people and inspire them. There are several approaches to leadership, most notably, transformational and transactional approaches. Some of the famous politicians and business executives are described as transformational leaders.
A great example of an exceptional transformational leader is the former CEO of Apple, Inc., Steve Jobs. Steve Jobs’ leadership might be seen as transformational since he inspired his employees and followers to achieve extraordinary goals (Lowe, Kroeck & Sivasubramaniam 1996). Steve Jobs was known for his creative abilities and is often described as a visionary, or someone who had a certain vision for his company, and managed to articulate it in such a way that it inspired his followers and ultimately helped him achieve his goals. Steve Jobs expected high performance from his employees by transforming work into a vision of the future and stimulating people to do their best.
Transactional leadership is another approach to leadership. Unlike transformational leaders, transactional leaders do not want a radical change and do not use their vision of the future as the main motivational point. Rather, transactional leaders focus on current performance and aim to enhance it by utilising a system of rewards and punishments. A notable example of a transactional leader was the former president of France, Charles de Gaulle.
Charles de Gaulle managed to establish order through a chain of command and helped stabilise the political situation during the 1958 crisis by applying a system of rewards and punishments. Although transactional leaders do not inspire radical changes, sometimes, it is not necessary. In certain situations, such as emergency or crises, the focus of transactional leaders on organisation and group performance is more valuable. However, once the crisis is over, people are less likely to support punishing leaders, and Charles de Gaulle ultimately had to resign to let France change its political and economic course.
The difference between the two leaders was not only in their approach but their working environment. Competition is the business environments prompts companies to find a competitive advantage, a product or an idea that will be revolutionary and will help the company get ahead of the competition. As such, Jobs was looking to change the future because it was the only way for his company to survive and be profitable amid competition. At the same time, de Gaulle was not pursuing any business goals; he was not looking for a transformational product. Rather, he was trying to establish order and gradually improve what was already built for greatest stability.
Different approaches to leadership are most useful in different circumstances. In the case of coaching a sports team, a transactional style can be more effective. On the other hand, as a business leader, I will apply the knowledge of transformational leadership to help make the company’s grand strategic visions a reality, thereby radically changing the rules of the game.
References
Lowe, K, Kroeckm G & Sivasubramaniam 1996, ‘Effectiveness Correlates of Transformational and Transactional Leadership: A Meta-Analytic Review of The MLQ Literature’, The Leadership Quarterly, vol. 7, no. 3, 385-415.