This paper tests the degree of overlap between operational definitions of transformational and transactional leadership, the nature of the relationships between the constructs of transformational and transactional leadership, and specified outcomes in an empirically derived data set by the application of two forms of analysis. Based on Bass's (1985) model, canonical analysis and partial least-squares analysis are applied to derive two path models. The data set was obtained from 1991 Canadian survey data that measured British Columbian school personnel's perceptions about the Primary Program, a mandated school reform policy. Findings indicate that transformational leadership influences school, teacher, and program/instruction outcomes directly and strongly. Evidence is presented for the positive, correlational nature of the relationship between the two kinds of leadership. The findings cast strong doubts on the usefulness of analyses that assume an orthogonal relationship between transformational and transactional leadership as independent variables. They also support the correlational view of the nature of the relationship between the two types of leadership. This was achieved by examining the structure of the two leadership concepts, the assumptions and procedures underlying the two modes of analysis, and the relationship between leadership and school improvement outcomes as presented in the two path models. Three tables are included. (Contains 44 references.) (LMI)