Finding Your Leadership Style: Transformational, Transactional or Laissez-Faire

ITA Group

Coworkers discussing leadership style in office setting

There are as many approaches to leadership as there are leaders, from Lewin’s Leadership Styles framework of the 1930s to the more recent ideas about transformational leadership. Building awareness of frameworks and styles can help you to develop your approach and to be a more effective leader. Take a look at these three leadership styles and reflect on which might best describe you.

Transformational Leadership

Transformational leadership focuses on the leader as the follower’s source of inspiration to exceed expectations. They have a charming personality and magnetism that draws followers to them, and they provide encouragement and support that inspires followers to want to meet their goals. This is a cooperative, process-focused style where the leader motivates their followers to create, inspire and influences changes in them.

Transformational leaders have integrity and high emotional intelligence. They motivate people with a shared vision of the future, and they communicate well. They're also typically self-aware, authentic, empathetic and humble. They expect the best from everyone, and they hold themselves accountable for their actions. They set clear goals, and they have good conflict-resolution skills. This leads to high productivity and engagement.

Style Benefits +

Transformational leaders are more likely to create more efficient communication avenues and an environment of trust and approval. This style can strengthen interpersonal relationships between leaders and those they manage, and can help future followers grow into leaders by being agents of change.

Potential Negatives –

The downside of this style is that, on its own, it can be chilling and amoral, and it can lead to high staff turnover. It also has serious limitations for knowledge-based or creative work.

Transactional Leadership

Transactional leadership focuses strictly on the interchange between leaders and followers, specifically what is the benefit to each party to complete the goal. Transactional leaders expect followers to be compliant, and ensure this by way of rewards and punishments. In this approach, the leader is not looking forward to transforming or improving the future, but just wants things to remain the same. Transactional leadership is ideal to carry out projects that need to be done in a systematic and structured manner.

Their goal is to encourage their followers to perform to their full capacity and meet the expectations. Based on reward and punishment, this leadership style can be effective in motivating employees in becoming productive and efficient members of the team. The "transaction" usually involves the organization paying team members in return for their effort and compliance on a short-term task. The leader has a right to "punish" team members if their work doesn't meet an appropriate standard.

Style Benefits +

Transactional leadership clarifies everyone's roles and responsibilities. And, because transactional leadership judges team members on performance, people who are ambitious or who are motivated by external rewards—including compensation—often thrive.

Potential Negatives –

It may prevent both leaders and followers from achieving their full potential. Unlike transformational leaders who tend to be forward-looking, transactional leaders are interested in merely maintaining the status quo.

Laissez-faire Leadership

Laissez-faire leaders give their team members a lot of freedom in how they do their work, and how they set their deadlines. They provide support with resources and advice if needed, but otherwise they don't get involved. This approach to leadership requires a great deal of trust. Leaders need to feel confident that the members of their group possess the skills, knowledge, and follow through to complete a project without being micromanaged.

Style Benefits +

This autonomy can lead to high job satisfaction. Use the laissez-faire style when dealing with highly skilled, trustworthy employees who have a clear understanding of a project’s overall goal.

Potential Negatives –

Lack of clear vision and direction for the organization lead the followers to adopt different goals and objective, increase the stress level among the followers and decrease the productivity and the quality. In such situations, projects can go off-track and deadlines can be missed when team members do not get enough guidance or feedback from leaders.

Leadership styles are not one-size-fits-all. There are a number of different types of leaders, all with different strengths and weaknesses. And while there are many leadership styles, the real question isn’t about what type of leader you are, but about what type of leader you want to be.

Know Yourself to Know Your Leadership Style

To determine your unique leadership style, you must start by knowing yourself.  Here are three questions to ask yourself right now:

  • What are your values? The best leaders lead from their most deeply held values. As the foundation of your personal leadership style, leading from your values means that your behaviors, choices and actions will be guided by those values.
  • What makes you, you? Your natural style will grow from your personality traits. Introverts can be leaders, as well as extroverts. Action oriented people can lead, as can disciplined planners and researchers. These natural tendencies (and many more) are an important foundation for your style.
  • Do you know your strengths? Can you recognize your weaknesses? Take your personality preferences and tendencies and put that together with past experiences and learning and you are moving towards your strengths and weaknesses.  It is important that you know both strengths and weaknesses, as collectively they help inform your style. 

Mix and Match and Motivate

The great thing about leadership styles is that you don’t have to choose just one; once you’re familiar with the risks and benefits of each of them, you can choose the one that’s most suited to motivate your team and address your needs at any given time. We love talking motivation! Be sure to check out our latest ebook for actionable tips and how you can effectively motivate even the largest, most complex group of people.

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