Transactional Leadership
This leadership style starts with the idea that team members agree to obey their leader when they accept a job. 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.
Transactional leadership is present in many business leadership situations, and it does offer some benefits. For example, it 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.
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.
As a result, team members can often do little to improve their job satisfaction.