Transactional Management at Its Worst

Holistic Management by Dr. Greg Waddell

Photo from Clipart.com

A friend of mine received a memo from his supervisor.  The memo was type-written on one of Microsoft Word’s basic templates, with the word Memo in thick black font at the top of the paper. It read: “Based on your performance, the position you were offered will not be available.” It ended with, “I apologize for any inconvenience this may cause.” The memo was left in the employee’s mailbox to be discovered at the end of the work day.

I share this with you because it’s an example of transactional management at its worst. According to this theory of management, the company gives payment to the employee and employee reciprocates with the equivalence in service or goods. Transactional management doesn’t care about the employee as a person, only about whether their demands are met.

Transactional managers don’t view employees in their full dimension of body, soul, and spirit; it is a mechanistic form of management. People are treated as gears in the organizational machine, raw materials to be exploited for the profit of the organization. Don’t get me wrong; I’m not against profit. I do, however, believe we have a moral responsibility to treat people in a holistic manner. Not only that, but I believe this approach ultimately provides the best ROI for the company. Transactional leadership, on the other hand, often fails to discover the hidden potential in people and therefore wastes precious opportunities for the company.

Transactional managers don’t take the time or effort to understand the experience of the employee. The supervisor in my example above did not have enough consideration to communicate this news to the employee in a face-to-face meeting.

Transactional leaders only respond when things go wrong. They spend their time watching for failures. When these take place, they become engaged, otherwise the employees are on their own.

Transactional leaders make no attempt to encourage or develop their employees and show no consideration for them as individuals. They don’t try to understand the heart and aspirations of the employee.

Transformational leadership is an alternative to transactional management. The transformational leader considers each employee as a total person; they pay attention to differences among their employees; they serve as mentors to those who need help to grow and develop.

In the case I referenced above, the employee was not only new to the organization, but was also venturing into a whole new vocation. The failure of the supervisor to help her employee points more to the poor performance of the supervisor than to the poor performance of the employee.

I know this person very well and I know the organization lost a high-quality individual. Any time an organization loses a high quality person simply because they do not initially perform well shows a fault in the organization itself, a failure to develop the hidden potential of their employees.

Often organizations act this way because they perceive people in a one-dimensional framework that says: “If they don’t perform well in this task, then they are not useful to the organization.” The failure to see people as physical, emotional, and spiritual beings creates a blindness to other strategic convergences between the individual’s unique purpose and the purpose of the organization.

Again, the supervisor in my example demonstrated a static perspective on human nature by presuming the poor performance was a problem with no possibility for resolution. She provided no feedback; consequently, the employee left the organization with no knowledge of what she did wrong. The Supervisor made no attempt to mentor the employee, which is one of the trademarks of a caring organization. Mentoring helps new employees learn “how things work around here.” The belief that people can learn and grow is a fundamental characteristic of transformational organizations.

The supervisor mentioned above failed to perform for her organization. If she continues to treat her employees this way, she will end up costing the organization far more than it would cost to take the time and make the effort to comprehend the spirit of people, to discover their natural potential, and develop that potential through mentoring, honest feedback, and encouragement.

Questions for Reflection:

  • How does having an understanding of human spirituality impact your management style?
  • Where do supervisors acquire their attitudes toward their employees?
  • How might this situation have turned out differently if the supervisor had exercised a transformational style of leadership?
  • Why do we sometimes fail to release the full potential of our employees?

provides consulting services for churches and organizations. Contact Dr. Waddell today at gregwaddell[at]leadstrategic.com to discuss the needs of your organization.

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