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What Really Motivates Employees?

Learn the pros and cons of transactional leadership

For centuries, businesses have tried to motivate their employees with rewards and punishments. On the surface, it seems these would be the easiest way to get employees to do a good job. This process is known as transactional leadership. It can be effective, but isn’t the only way to reach your employees.

There are also limitations with using transactional leadership as the only means of motivation. Employees want monetary rewards, better positions and nicer offices when they do well. They also want to do a good job so they don’t get fired or given meaningless work.

On the other hand, employees are human beings. They are too complex to be motivated solely by rewards and fear. Here are some limitations of transactional leadership styles:

This is not to say that transactional leadership does not work. Rewards and punishments are great tools to motivate. However, they may be far more effective when combined with other leadership styles and motivation tools. Making employees feel included can provide greater motivation and overall satisfaction.

The transactional style has always been effective. It has also been overused by many companies. Employees can be more productive when they feel appreciated and included. Transactional leadership styles can be much more effective when combined with other tools that provide motivation and encouragement.