Leadership, Transactional

Conceptual Overview

While the roots of transaction leadership theory can be traced back to earlier motivational exchange theories, Burns's 1978 work on political leadership is recognized as a seminal piece in regard to the theory's development. Burns illustrated that the process of leadership was political in nature and that leaders achieved compliance from followers not only through emotional or charismatic forms of influence but also through transactional exchanges between themselves and their followers. These exchanges involve leaders offering tangible rewards to their followers in return for the achievement of performance criteria. In short, Burns argued that leaders could shape the behavior of their followers by appealing to the self-interests and expectations of these followers.

In 1985, Bass applied Burns's ideas to management contexts and explained that the study of leadership as an exchange process in organizations emphasizes a transactional relationship in which followers' needs can be met if their performance measures up to contracts with their leaders. He added that transactional leadership includes “supervisory and subordinate relations in which leaders: (1) recognize and obtain resources that followers need for effective performance; (2) exchange rewards for effort; and (3) are responsive to their followers' immediate self-interests if these interests are related to the completion of work” (p. 11).

Much of the literature on transactional leadership discusses the concept in relation to transformational leadership. The comparison invariably presents transactional and transformational leadership as occupying opposite ends of a perceived leadership spectrum: Transactional leadership would occupy the rational end of the spectrum, because it grounds the influence of leaders in concrete rational exchange processes; transformational leadership would occupy the irrational end of the spectrum, because it grounds the influence of leaders over followers to the intangible, [Page 791]irrational, and, in most cases, charismatic qualities of leaders. In general, this comparative approach is aimed at ascertaining the organizational context in which either transactional or transformational leadership, or a certain mix of the two, is appropriate. These studies also focus on how to recognize and train transactional and transformational leaders. Some contributors to these studies include Kuhnert and Lewis in 1987, Howell and Avolio in 1993, and Wofford, Goodwin, and Whittington in 1998.

Critical Commentary and Future Directions

Reflection on the broader debates that were occurring in organization studies when Burns first published his work suggests that what he had to say about the transactional nature of leadership correlated with the attempt by organizational theorists to distinguish between leadership and management (see Yukl's 1989 study). Burns's work, however, subtly illustrates that these debates may have been somewhat misguided, because the transactional nature of leadership suggested that leadership necessarily has a management dimension. Further, his discussion of the need to recognize the role that exchange processes played in the politically oriented nature of leadership also suggests that, at the time, the literature had a preoccupation with the irrational side of leadership.

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