Situations to use Transactional Leadership in Team

Transactional leadership occurs when the leader rewards the team member, depending on the adequacy of the team member’s performance. Transactional leadership depends on contingent reinforcement, either positive contingent reward (CR) or the more negative active or passive forms of management-by-exception (MBE-A or MBE-P). [1]

Here are some situations I can think of.

* Use CR – when you found team member is motivated with some kind of reward & you can arrive a mutual agreement with your team member on reward he is getting after the work done is expected fashion.

* Use MBE-A – when you don’t want a mistake/error done by your team member propagates further that may jeopardize the project. You actively get the statuses, problems, challenges, develop processes, ensure adherence of project processes, conduct reviews, etc so that no error goes beyond certain time period. This really required when you manages a critical project & have time to do micro management. This is used when team member is having less experience in the work area. MBE-A may be required and effective in some situations, such as when safety is paramount in importance[2].

* Use MBE-P – when you don’t really care much about the errors or deviance as soon as it occurred. You have some time to correct them & they are not critical. This is followed when team member is having good experience in the area of working.
Leaders sometimes must practice passive MBE when required to supervise a large number of subordinates who report directly to the leaders[2]


1. Significant Behaviors of Transactional Leadership –
2. Transformational Leadership (Second Edition) BY Bernard M. Bass, Ronald E. Riggio, Lawrence Erlbaum Associates, Inc.,2006

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