Transactional Leadership Law and Legal Definition

Transactional leadership is a leadership approach that uses a system of rewards and disciplinary measures to motivate employees. Transactional leadership seeks to motivate followers by appealing to their own self-interest. Its principles are to motivate workers by the exchange of status and wages for the work effort of the employee.

Transactional behavior focuses on the accomplishment of tasks and good worker relationships in exchange for desirable rewards. Transactional leadership may encourage the leader to adapt their style and behavior to meet the perceived expectations of the followers. Critics of transactonal leadership claim that intrinsic motivators, such as pride in one's work are necessary for effective leadership, as opposed to the extrinsic factors emphasized in transactional leadership.