There are two types of organisational leaders – the transactional and the transformational.

Transactional Leadership: Transactional leaders are the ones who work with the safety of the status quo. Transactional leadership is based more on “exchanges” between the leader and follower, in which followers are rewarded for meeting specific goals or performance criteria.
A transactional leadership style is appropriate in many settings and may support adherence to practice standards but not necessarily openness to innovation. A transformational leadership style creates a vision and inspires subordinates to strive beyond required expectations, whereas transactional leadership focuses more on extrinsic motivation for the performance of job tasks.

Transformational Leadership: Transformational leaders strive with all their might to change the existing order of things. They are the ones who bring about major, positive change for a group, organization or society. According to Sullivan & Decker (1997), the transformational leader is not concerned with the status quo, rather with “effecting revolutionary change in organizations and human service” (as cited in Trott & Windsor, 1999). Bass (1996) defined transformational leadership as the ability of a leader to motivate employees to surpass their own individual aspirations for the greater good of the organization. Burns (1978) depicted the transformational leader as a morally responsible manager who focuses on developing the moral maturity, values, and standards of his or her subordinates and strengthening their devotion to serve the well-being of others, their organization, and society beyond self-interest (as cited in Olsen & Johnsen, 2006).

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