Choosing a Leadership Style: Transactional or Transformational?

It’s easy to see when something right in front of you is on its way out: The “s” button on your keyboard gets stuck, your phone keeps redialing voicemail even though you have no messages, or the button on your favorite blazer is hanging by a thread.

But when it’s something more personal, like your leadership style, it can take a little more time to notice that something that was once tried and true may need a little revamp.

In a recent Inc. article, “10 Leadership Practices to Stop Today,”  (opens in a new tab) writer Paul Spiegelman, the CEO of patient-management firm BerylHealth, espouses the benefits of adopting a transformational style of leadership versus a transactional one. Micromanaging is out, he says, and while empowering your employees may lead to mistakes, it also builds a better relationship. In other words: Stop pretending you know everything, and ask questions of your employees, who bring their own skill sets to the table.

More thoughts on leadership styles below:

Why switch sides? Ultimately, transformational leadership styles lead to greater employee retention and fast adoption of new initiatives  (opens in a new tab), according to Malinda Zellman, writing for The Houston Chronicle. Meanwhile, Inc.‘s Spiegelman says that the approach will positively influence the company as a whole. “[Y]ou can see increasing evidence that by creating a company with a clear purpose and values, you’ll find your employees connect themselves to something bigger, and that increases productivity,” he writes. “In other words, a culture of engagement leads to greater customer loyalty and better financial success.”

But results matter, too: Spiegelman may be right, but one should consider the other side. Transactional leadership has its perks  (opens in a new tab), too. This style of leadership is mostly seen in sales-driven jobs, where the early bird gets the worm, or in this case, the best commission. Steve Jobs’ famous example of pushing the Apple team to accomplish what was seemingly impossible resulted in numerous innovations, all because he refused to fail.

In the end: Competition is healthy in the workplace, but balancing competition with a holistic understanding of a company’s values and motivations is a clear-cut winner for both leader and follower.

So what’s your leadership style? Could it use a tune-up? Tell us in the comments about how you’re balancing transactional and transformational leadership styles in your workplace.

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