Question

Study Case

Henny Fang is the founder and owner of the CDC Control Corp (M) Sdn Bhd, based in Malaysia, Henny prides on knowing everything about her employees; both at work and at home. If they have marital problems or personal problems, she wants to know.

And she thinks nothing of using that information if she thinks he can help. “There are no secret here,” she says.

No subject is too delicate for her ears. And her justification is that she is merely doing what any good friend might do. Also, she believes the more she knows about her workers, the more she can help them to stay focus at work and happy at home.

But out of this “great boss” behaviour, Henny instructs her employees to do the way she tells them to do it. She uses authority to make rules and dish out punishments. One of her basic rules is “I will only tell you something once.” Break one of her rules twice and she will fire you.

She believes in openness, integrity and honesty. But she expect as much as she gives. It’s not an option. On top of all these inconsistency, in an industry known for high turnover, her managers stay about 10 years compared with average of less than two.

Is Henny a transactional or transfomational leader? explain your answer in details (1000 words)

Answer 1

A transactional leader is a leader who focusses more on rule and regulations and is not concerned about anything else. There are leaders who want their employees to follow the process and be in line with the organisational policies. Transactional leaders are very committed towards improving the employee performance based on the certain rules which have been tried and tested before. In this kind of leadership style, there is no scope for employees who would want to be innovative and do something different. Transactional leaders are dominant and want their employees to follow what they say. They believe in a reward and penalty system where the employee is rewarded for their good performances and punished for their mistakes.

A transformational leader on the other hand is a leader who believes in keeping his or her team motivated. These leaders encourage their employees to think out of the box and bring in ideas which helps to look at the world in a different way. Transformational leaders as the name suggests, focus on transforming the routine working style into a new and unique working style, thereby encouraging inventions and innovative techniques.

In the above case, Henny who is the owner of CDC Control Corp believes that by being empathetic she becomes a good leader. On the other hand, she wants her employees to listen to what she says and follow the same without committing any mistakes. Therefore, she is being empathetic by advising them to deal with their personal professional problems and on the other hand dominating them to follow her rules rather than the employees putting their own minds and getting themselves out of trouble.

It shows that Henny is more of a transactional leader as she wants her employees to follow what she says and if somebody does not follow her she punishes them by firing them for their second mistake. As an employee, this is a tricky situation, because considering myself, I would never want to work under a leader like who does not give the freedom to think. It is also mentioned in the case that her managers have been with her for a period of ten years which is far more than the average tenure of any employee in the same industry. This must be because these managers are used to leading their professional life by their leader who dictates them what to do and they would have lost their ways of thinking on their own. This could be challenging for them if they move to another organisation where they might not get people who would tell them what to do overtime.

Therefore, Henny in my view is a transactional leader and not a transformational leader.