Corporate business managers need to rely on their skills and expertise in the business world to creatively solve the challenge of managing large groups of people while still ensuring company success. Often, large companies will have many departments each with their own agendas that must work alone and in sync with other departments. Projects are often long term engagements, and people of many different temperaments and skill sets must get along with one another and their leader in order for jobs to be done well. Leadership is the single most important tool that the business manager has in his arsenal to manage and motivate their employees. In business, the optimal business leadership approach is a transformational leadership model. This model of leadership represents a marriage of many leadership approaches and is characterized by flexibility and adaptiveness. A close look at its parts can give a better sense of how transactional leadership can be achieved.
In the business world, the simplest common denominator for any relationship a manager has with their team is the relationship between employee and employer. A transactional style of leadership uses this foundation as the basis for all management. The relationship is fairly straightforward. Employees agree to to follow their leader when they accept a job because they are given pay in exchange. This is the transaction. In this leadership role, the business manager possesses the right to punish as well as to reward. The advantage to this leadership approach is its simplicity. Roles and responsibilities are quite clearly defined, and everyone is judged on their performance. Employees who enjoy the motivation of rewards thrive in this kind of environment, and the business manager can mete out punishment as well for poor performance. However, the downside to this kind of leadership style is that job dissatisfaction can build up fairly quickly and workers can feel stuck in their roles. This kind of style is great for short term projects, but creative work can suffer.
Autocratic leadership styles are also fairly easy to understand. They are, in a sense, a severe form of the transactional leadership style, except that a team member can make no input. One individual has absolute authority in every part of the decision making process. When there is a crisis or a quickly approaching deadline, autocratic leadership can be very effective, but it is also has a habit of breeding resentment in team members. Autocratic leadership styles are also very effective when the skill level for a job is fairly low and the tasks are routine.
A slightly more complex evolvement of the transactional leadership style is the bureaucratic leadership style. Bureaucratic leaders are effective for their ability to follow every procedure by the book. Rules are clearly defined and everyone follows the rules and routines to a letter. Work in factories and nuclear facilities are necessary places for bureaucratic leadership styles since safety is a major concern of the leader for their employees.
Although these initial approaches to transformational leadership may not seem as soft or forgiving or accepting of creativity, many operations in the business world involve rote, repetitive tasks that require some aspect of these leadership positions. The crises and deadlines that are regular part of the business world also require more decisive modes of leadership that a business manager can include in his leadership toolbox.