Summary Phase 1: transactional leader

PHASE 1: TRANSACTIONAL LEADER
1. THE TRANSACTIONAL LEADERSHIP STYLE
Competitive value framework: internal process model – rule culture (internal focus and
stability and control)

 Strong influence of Max Weber and Henri Fayol
 Leaders need to pursue stability and continuity
 Organisation operated according to three top-down and hierarchical principles of
the professional bureaucracy
 Leaders had to be technical competent and reliable and were experts in designing,
coordinating and monitoring work
 Leaders strived for optimal planning and division of labour by threatening their
employees fairly and equitably

McDonaldization: the process by which principles of fast food restaurant are coming to
dominate more and more sectors of society as well as the rest of the world.

 Efficiency: perform a task in the fastest way
 Calculability: the emphasis is on the quantitative by expressing everything in
figures
 Predictability: uniformity and standards for service and production
 Control: technology and machines control the simple and routine work of
employees
 Danger: red tape: too much focus on rules and procedures, which blocks the
employees from working and innovating




Example of a typical transactional leader: Bill Gates (provides structure and communicate
clear expectations)

2. MECHANISM OF JUSTICE
The transactional leader can have an impact/effect on wellbeing and performance of
employees through mechanisms of justice.

Research shows that

 Justice/fairness is linked to happiness (i.e. wages versus meaningful jobs)
 Low fairness -> lower efficiency and productivity
 Perception of fairness is also important (3 types of perceived fairness)

, o Procedural justice: The fairness of the processes that lead to outcome
(i.e. the way in which decisions are made).
o Distributive justice: The fairness associated with decision outcomes and
distribution of resources. The outcomes or resources distributed may be
tangible (e.g., pay) or intangible (e.g., praise).
 Equity Theory of Adams: input-output ratio
 input-output ratio (balans input energy/efforts and the result)
 Employees compare themselves with their colleagues in
function of compensation/benefits and input balance
(example salary)
 If the ratio is considered as unfair, they take conclusions and
action (working less, asking for increase in salary, or leaving
the organization)

o Interactional justice: The treatment that an individual receives as
decisions are made and can be promoted by providing explanations for
decisions and delivering the news with sensitivity and respect.
 Informational justice: explain regulations and systems to
employees, need for information, availability of information
concerning rules and procedures
 Interrelational/interpersonal justice: treat people respectful, equal,...
 The Golden Rule: Treat others how you want to be treated
 Procedural justice has strongest link with job performance.
 Distributive and procedural justice have an average to strong link with job
satisfaction, commitment, and performance.
 Interactional justice is linked with satisfaction with leader
o Employees are less satisfied if their job expectations are high compared to
those of their manager
 Fair process effect: relevant to look at the interaction of the three forms of justice
o Unpopular outcomes (distributive) have advantage of a fair process
(procedural and interactional)
o Important that you communicate

3. RELEVANCE CLASSICAL BOSS IN 21STE CENTURY?

3.1. ATTENTION TO DIVERSITY
Study McKinsey & Co:

 Top 25% companies on racial and ethnic diversity have 30% more chance to have
better financial results than the national average of their industry
 More innovation, higher chance of attracting talented people (<-> war for talent)

Case: James Damore at Google

Gender gap:

 Today: 32.0% average gender gap that remains to be closed
 Political leadership: 18% of ministers and 24% of parliamentarians globally
are women.
 Economic leadership: women hold just 34% of managerial positions.