Leadership is generally defined as a dynamic relationship based on the mutual interest and common target between leaders and actually people whom they are motivating- workers, in which both are moved to the higher level of motivation and development of different essence as they affect change. (Scholl,2002) And in more simple words, leadership is an interpersonal influence that is directed towards achievement mutually agreeable objectives. The main word in this definition is said to be influence, as actually it, as a power to affect others, reveals the general idea of the proposed subject and is the basis and the platform for all the further discussions.

There are several types of leadership that leaders use in these or that their activities, but let me stop and discuss more thoroughly two of them- Charismatic and Transactional styles of leadership.

Charismatic style of leadership starts with the definition of charisma, which has been studied as a trait and even a set of behaviors. (McGraw-Hill, 1999) A dictionary gives us the definition that says that charisma is a divinely conferred power or talent. The other Merriam-Webster Dictionary says that it is “a personal quality of leadership arousing popular loyalty or enthusiasm.” (Merriam-Webster’s collegiate dictionary, 1993)

A person or a leader that uses a trait approach to charisma possesses such personal qualities as being visionary, energetic, unconventional and exemplary; having a rhetorical ability is also a distinguishing feature of a charismatic leader.

They are also self-confident, purposeful and dominant, articulate and a bit idealistic, influential and very expressive.

It is on the most recent styles of leadership defined. It was founded out that a charismatic leader gathers people around, and followers as well through dint of personality and charm, rather that using some external power of authority. In other words a leader emphasizes on some inner, personal traits rather that on using of some gained abilities and acquired features.

Charismatic leadership can be called a personal style as well, a such leaders pay enough attention to all group members equally and provide a subordinate with an idea about his/her importance. Such leaders pay very much attention to studying their environment and trying to adjust to its changes; scanning the moods of both individuals and groups of people is also a great concern.

A range of methods is used by such leaders to manage their image in case skills are not natural- they can be easily developed. (Potts,2002)

In such cases people start a kind of showing off suiting to the desirable reaction of the audience. They are very much concerned with the communication skills, such as verbal and body language, and are very good psychologists as well, as they need feel perfectly the audience in order to present just what is expected, or by knowing the sense of the audience persuade it to do what was planned.

While building a team, charismatic leaders are very much anxious about definitely separating of it from the other groupings. That is all for the perfect image of the group, in minds of the followers basically, for being far superior than others.

All previously mentioned is more about the moral side of the style, but there are also five behavioral attributes of Charismatic Leaders that indicate more transformational point of view: vision and articulation, sensitivity to the environment and to member needs, personal risk taking and performing unconventional behavior.

It is very important to note that charismatic leaders are controversial a bit in their beliefs as they seek both commitment to the ideological goals and also are very devoted to themselves. And only after the determination of which one of the two goals is dominant, the motivation and needs of the leader can be differentiated.

As to the basic focus of the Charismatic leadership, it entirely depends on the values of the leader. He/she may not want to keep up with changes and therefore the company can be static for all its life; but at the same time if the principle values are well-intentioned toward others, he/she can elevate and transform the entire company. That solely depends on whether the motives of the leader are ethical or not. (Johnson, 2000)

Mahatma Gandhi, Winston Churchill, Franklin D. Roosevelt and Mother Teresa what have in common? They all are usually called charismatic. Why? For their passion for a cause, commitment, vision, energy and courage; they all have dramatic stage-effect. They all were bright and revolutionary; they all inspired masses and were able to influence them greatly.

There is an opinion that the ideal environment for the charismatic leader is a crisis situation, as only in this way he/she would be able to develop a salvage plan and use all his/her best qualities.

So, summarizing all that was previously said there are four stages in development of a charismatic leadership:

  • Sensing opportunity and formulating a vision;
  • Articulating that vision( in other words having a global and strategic thinking and ability to deliver it to wide auditory);
  • Building trust in the vision( contains personal risk-taking and self-sacrifice for the trust and adequate motivation of the followers);
  • Achieving the vision (use of personal example for demonstration of different tasks). (Gibson, Hannon, & Blackwell, 1998)

Charismatic style of leadership is usually associated with Max Weber, who although had more trait approach to the leadership, defined charisma as a certain quality of an individual personality, by virtue of which she/he is set apart from common people and treated as endowed with supernatural, superhuman, or at least specifically exceptional powers or qualities. He also wrote that it can be achieved by an ordinary person and those traits are of the divine origin, and on the basis of them the individual concerned is treated as a real leader. (Weber,1947)

He distinguished four types of charisma: hereditary monarchy, patriarchal authority, religious charismatic and military hero. He believed that charismatic leaders choose members not for technical training but on the basis of social privilege and charismatic authority, and that authority is radically opposed to both rational and especially bureaucratic authority. He also considered that to be, in pure form of course, an absolutely anti- economic force and at the same time clearly stated revolutionary one.

Charisma can be defined as one of the ideal types of authority. (Sellers, 1996) The other two are- bureaucratic and feudal.

There is also a dark side of charismatic style. It refers to the leaders that demanded blind obedience without any questions and remarks, and emphasized their absolute power and privilege. That is about Hitler and Mussolini; and religious manipulation and emergence of many cults and sects.

Another type of leadership is transactional one. The main thing about this type of leadership is that its main focus is on the performance outcomes; such leaders basically pay attention to real results that were achieved.

Transactional leaders usually motivate followers by appealing to their own self-interest. They guide individual contributors/followers in the direction of the stated objectives and different task requirements.

The major elements of this type of leadership are:

  • Measurement;
  • Control;
  • Performance;
  • Administration.

So, it becomes obvious that the essence of this leadership is more practical and mechanical one and actually mechanics range from controlling ideas such as values, specific objectives and goals and to more distinct systems defined as policy, process and procedure.

Transactional leaders often manage performance by helping people to interpret vision, values and strategy in the direction of a successful performance of an organization. Those additional helping interpretations push followers towards right actions and tactics that stimulate gains towards achievement of organizational targets. In many cases, those tactics and actions are documentary formulated like particular procedures or a kind of business plan towards some goal.

Some researchers believe that today’s transactional leader behavior can encompass four different types of it: Contingent reward ( clarifying of the work that needs to be done; use of different incentives to achieve goals when expectations are met); passive management by exception( use of correction and punishment when the performance goes not the expected way); active management by exception( active monitoring of the work performed and slight corrections to ensure the work is taking needed direction); laissez-faire leadership( the leader is indifferent to everything that is going on around him in the organization and let the performance go how it goes).( Pillai, Rajnandini, Schriesheim, Chester & Williams, 1999).

So, generally speaking transactional leadership style is used at some extent by many leaders, and leaders do not usually choose only one leadership type to influence others.

The key ideas of this leadership style are the following: clear boundaries (distinct differentiation between function and role, technical process, span of control, decision rights and domains of influence allow leaders effectively achieve desirable objectives); order (the idea is that for a leader everything has its own time, place and usefulness; by maintaining to highly ordered system of interaction leaders can predict outcomes); compliance (need to comply with mutually defined operational guidelines and methodologies in every aspect and question in an organization); willfulness ( need to impose order and control on all the chaotic and uncontrollable environment is the main force of the style). ( Conger,1999)

This style of leadership is the most effective one to achieve long-term objectives and improve performance by building a strategy for that.

Transactional leaders usually influence others by exchanging work for wages, but this type of stimulation is not very effective as it doesn’t build a creative sense in worker’s mind and doesn’t develop his/her need for meaningful performance.( Syque, 2002)

So, the basic idea of the transactional leadership style is built on exchange of something, whether it is pay or reward, such as performance rating, recognition or praise. From the side of a leader all previously mentioned can be achieved by using following behavior: clarify goals and objectives to obtain accurate and when necessary immediate results; create structures and processes for further control; solve problems themselves; maintain and work for improvement of the current situation; plan, organize and control; guard and defend culture; power comes from the position and authority in an organization. (Bass, B. M., & Avolio, B. J. (1990). The multifactor leadership manual. Palo Alto, CA: Consulting Psychologists Press. Bass, B. M., & Avolio, B. J. (Eds.). (1994). Improving organizational effectiveness through transformational leadership. Thousand Oaks, CA: Sage. )

Both styles of leadership have their advantages and disadvantages that make them applicable and suitable in different situations. Charismatic style seems to be more mystical one and dual in the sense that it is magnetic and can be dangerous when the person who’s using it do not have very good intentions. (Freiberg and Freiberg, 1996)

It is very important that everything towards what skills can be applied is not in vacuum and is very relative and what can be said to be charismatic in one situation or country cannot be in another.

There are four types of leaders I would like to discuss and point out to what types out leadership styles more refer to. So, they are HR leaders, structural leaders, political and symbolic ones. Charismatic leaders are more HR leaders, political and symbolic because HR leaders believe in people and effectively deliver that belief. They are visible and accessible; they empower, increase support and participation, share information and are very attentive. Political leaders clarify what they want and what they can get from the particular situation, they are very persuasive and have power to inspire and make people/followers do what they need. Symbolic leaders view an organization and the whole their performance as a theatrical scene and that is very actual to charismatic leaders also; those leaders use symbols and bright speeches to capture and hold attention; they play certain roles and are very impressive while acting. (Waldman & Yammarino, 1999)

From the other hand transactional leaders tend to show features of structural ones. They focus on structure, strategy, and environment; they focus on implementation, adaptation and realization. They are very accurate and strategic. (Bass, Avolio & Berson, 2002)

In the conclusion I would like to state that there is no one only right and appropriate style of leadership to follow. The true leader should always thoroughly explore the type of the organization or the particular situation and then apply one the styles.

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