Why do businesses still employ/hire Transactional Leaders even though they only achieve an expected result or less?
Although the Transformational leaders scientifically and undoubtedly show great results that is sustainable...
Because the business is interested in short term and immediate results. May be it is in the need to do so and may be the top guys talk sales only? And it is very clear that the road will come to an end very quickly. It is not sustainable.
Because far too many hiring managers and recruiters are intent on recruiting specific technical skills rather than functional expertise - the infamous and business debilitating pigeon-holing. Many are young, they may well be graduates and conditioned to think in certain "transactional" ways and that conditioning may well give them insight but only real live experience gives foresight and the ability to accurately apply transformation that gives competitive advantage - examine any business life-cycle model and the need to innovate is always at the very top of business survival. Transformation should always be embraced and doing things differently should be at the top of every board room agenda.
There is ample evidence that being better is no longer enough in business, businesses need to be both better and different and that is where transformational leaders will always lead the field and bring class leading performance to business.
There is also considerable discussion about hiring managers being reluctant to employ high-flyers; seasoned experts or major change agents as they fear being over shadowed by the new appointee and their tenure being put at possible risk so rather than manage a business upwards; they adopt a policy of managing a business onwards and produce more of the same.
Only the adventurous and entrepreneurial companies will ever really appreciate the value of transformation and not fear the skills; expertise and vision of transformational leaders; those leaders who have little left to prove but vast amounts to achieve, so hiring managers that may be in fear of superior talent, do not be, business transformation is essential in modern business.
Sometimes ya gotta get from here to there. A transactional leader is there to pragmatically baton down the business, they're more of a mechanic. My buddy related an interesting story over the holidays - he's kind of a draftsman-trouble shooter for big projects. He readily admits there are better draftsman than he. And yet there is a huge gap between a big picture objectives and the daily grind which had created a huge impasse. He goes in, sees the problems clearly and cleans them up. His job is not to lead so much as to right the ship.
Businesses hire Transactional Leaders to maximize profits/production, while accomplishing a specific goal. The Transactional Leader by definition excels at a given task, while focusing on the roles of supervision, organization and group performance. The managerial style of this type of leader fits the needs or perceived needs of the business that hires them. They're hired to achieve an expected result, and succeed or fail their tenure with the business is usually short-lived.
This is a great question that seeks to tease out the difference in leaders, particularly in this instance - Transactional Leaders. I believe that Transactional leaders, even if it is that they only acheive an expected result or less, is important, depending where you put them within the organisation and is not all leaders and CEOS, but they can still be very effective within as team.
A lot of other reasons why businesses still employ/hire transactional leaders is because of the lack of availability of others in the marketplace.
Finally, a number of business still employ/hire transactional leaders because they are unaware that they generally underperform and it is a reason why businesses and executive teams need to look to different types of personalities and leaders, other than simply transactional ones.
Probably because Transactional leadership has been around for so long that it is probably considered the norm, while a more entrepreneurial type of organization would hire leader who can think "Out of the box" - a Transformational leader.
I am not sure that transaction and leader or compatible descriptors.
Transactional leadership differs from the transformational leadership because this person does not have to worry about people individualize needs and/or would not need to focus on an employee’s personal development process. Also, this person is more focused on the exchange of value through task output rather than relationship transactions. An example of this a contingent reward process in which the employer will spell out in performance appraisal with an employee about the quantity and quality of productivity that must be met for this person to be a value part of the company objectives or goals.
I believe that to many managers are not informed about the new leaders that is needed in a modern company, and that some of them are afraid of the transformational leaders as they have real leadership skills. And they often don't, as they often come from a specialist background with no or little leadership skills.
Please look at this video clip from Gary Hamel that explain this in a good way;
They hire Transactional Leaders even though they cannot achieve an expected result or less. The idea is doing something toward a gain or increase is better than doing nothing. Looking for some result is better than non. Getting an idea of what scientifically by hypothesis works and aiming toward that success.