Transformational vs Transactional

Transformational vs Transactional

Transformational vs Transactional

When it comes to business relations, for better or worse, most of us think transactionally. This is true even on a broader scale, talking about interpersonal and cultural relations. We think of our interactions in terms of debt, of “owning” one another, and of how we’ll pay each other back. Just because this is common, however, does not mean that this is correct.

Arguably, a stronger and healthier way of relating ourselves to each other has little to do with transactions and more to do with transformation. Prioritizing the transaction puts us in a position to meet deadlines and quotas, but prioritizing the relationship puts us in a position to transform our relations to be stronger, healthier, and more fulfilling. This is just as true in the interpersonal as it is in business.


Relationships with Clients

When it comes to clients, or any third party, it’s incredibly easy to fall into the transactional mindset. When discussing a project, for example, the expectation might be to set the standards and expectations, and then commit to completing the project and waiting to finish before receiving feedback. Whether payment comes at the beginning, at the end, or throughout, this mindset of “what we give vs what we receive” can not only lead to adversarial relationships, but is also a suboptimal way of approaching any project.

Especially if you’re completing a project for a client, chances are your client is the expert on what results they need and why they need them. Further, neither time nor information are static. What you and your client know at the beginning of the project will not be the same at the end, and is bound to change throughout the process. If planning and completion are the only two times that there is real discussion happening, you might be throwing away all of this learned information in between.

Whether this framing is accurate or the roles are reversed, the only way to take advantage of the growing pool of information shared between the two parties is to move through the project collaboratively—not transactionally. Not only does this increased collaboration and communication work towards higher quality outcomes and more precise directions, it also helps take the relationship away from an adversarial one and more towards a team effort. This implies an increase in trust and familiarity that can easily result in better and more projects down the road, as well as referrals and other benefits.


Relationships with Workers

The same is true when we focus on the internal relations in the company. You shouldn’t just talk to clients at the end and at the beginning of a project, and you shouldn’t just talk to employees to pass on responsibilities and evaluate results. In both cases, everyone is better off in a more collaborative relationship.

In the case of employees, the transformational power of a non-transactional relationship is very literal. In a mentor manager sense, it’s very important to recognize that employees are much more than just cogs in the company machine. Workers have their own aspirations, their own values, and as a mentor manager, it’s important for you to help them towards these aspirations, even if they aren’t perfectly aligned with the business. This transformational relationship builds a healthier workplace environment and culture, which contributes to better performance and commitment on the clock. Invest in your workers, and they’ll invest back into the company.

Reimagining relationships this way helps us reach new heights in many different ways. We recognize each other as important points of a community, and a community rises together—not transactionally. Thinking less about exchanging services and more about extending a helping hand can help us grow as individuals, as a community, and as a people—inside and outside of business. 

Living Pono is dedicated to communicating business management concepts with Hawaiian values. Founded by Kevin May,  an established and successful leader and mentor, Living Pono is your destination to learn about how to live your life righteously and how that can have positive effects in your career. If you have any questions, please leave a comment below or contact us here. Also, join our mailing list below, so you can be alerted when a new article is released.

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