Section Two: Leadership Styles (Between 300 – 400 words) (E.R. 3.2)

b. Compare and contrast two different leadership styles

- Bring out the differences in the attributes and skills that are required for each leadership style

- Elaborate on any four differences

- Explain their significance for effective leadership in organizations

Transactional Leadership

These exchanges involve four dimensions:
|[pic] |Contingent Rewards: Transactional leaders link the goal to rewards, clarify expectations, provide necessary resources, set mutually agreed |
| |upon goals, and provide various kinds of rewards for successful performance. They set SMART (specific, measurable, attainable, realistic, |
| |and timely) goals for their subordinates. |
|[pic] |Active Management by Exception: Transactional leaders actively monitor the work of their subordinates, watch for deviations from rules and |
| |standards and taking corrective action to prevent mistakes. |
|[pic] |Passive Management by Exception: Transactional leaders intervene only when standards are not met or when the performance is not as per the |
| |expectations. They may even use punishment as a response to unacceptable performance. |
|[pic] |Laissez-faire: The leader provides an environment where the subordinates get many opportunities to make decisions. The leader himself |
| |abdicates responsibilities and avoids making decisions and therefore the group often lacks direction. |

Transformational leadership is the use of high energy, enthusiasm and passion to inspire and motivate employees. While