Transactional v. Transformational Leadership on the Small Scale

With just one additional week working at Boxcar under my belt, I have already learned so much more about the company and what it means to work for a small startup. While I knew that I would be working with a lot of young people this summer and the office culture would maybe be more laid back than I was accustomed to, I predicted that the overall leadership style would be more transactional than transformational. The company is still so small, so I assumed that everyone would have their nose to the grindstone and the interns would be incentivized to work harder with the hopes of the app really taking off. One of the hallmarks of transactional leadership is for the leader to have a very straightforward and surface level relationship with its followers/employees. However, the culture at Boxcar is incredibly different from this description. Our CEO really makes an effort to get to know all of the interns. He asks about our families, friendships, and career aspirations. Not only does he want to foster an efficient working environment for his company, but he also wants an environment where the employees get to know and connect with one another, which aligns much more with the characteristics of a transformational leader than a transactional one. For instance, one of the interns has been working at Boxcar for three summers, and has really gotten to know the CEO better than the newer employees. When the intern told our CEO that over the weekend he was planning on visiting his girlfriend, our CEO exclaimed “Wow I didn’t know you had a girlfriend! That’s so wonderful, congratulations.”

We learned in our Theories and Models classes that transactional and transformational leaders have both strengths and drawbacks depending on the situations they are in. Transactional leaders perform best in high stress and low stress situations while transformational leaders perform best in situations with moderate intensity. This theory is successful when applied to Boxcar’s leadership style. While our day to day work is not entirely stressful and dire, there is a sense of urgency in that the company is only a small startup, and there needs to be constant growth in order for success. This theory also helps to surmount challenges that Boxcar may face. Having a leader that carries such an interest in his employees in such a small and contained setting definitely helps to make the company culture more relaxed and gives the employees more confidence and security when working there. I look forward to seeing what other theories from my Jepson classes can be applied to my internship this summer.

One thought on “Transactional v. Transformational Leadership on the Small Scale

  • Great to hear that you were pleasantly surprised to find a more transformational environment despite the age and size of the company. For the paper you’ll write this fall, you’ll need to take a deep dive into one theory. Should you choose to explore transformational leadership in the context of your site, you’ll need to speak more specifically about the four factors – idealized influence, inspirational motivation, individualized consideration, and intellectual stimulation – and provide examples from your site that illustrate (or do not illustrate) these. So as you continue, you may want to observe and reflect on the way these four factors are embodied (or not) by the CEO or other leaders at the organization.

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