Strategic Leadership and Management
- Strategic Leadership
Evans and Lindsay define strategic leadership as the ability to envision, anticipate, reason strategically, and maintain flexibility. It also entails coordinating with others in initiating change geared at increasing an organization’s competitive advantage and creating a viable future (Lindsay, 2014).Strategic leadership is divided into three levels. Senior leaders formulate visions and strategies, middle-level management develop action plans while keeping in mind resource availability’ Lastly, supervisory leaders initiate and ensure that the action plans are executed. Glen Rowe articulates that without effective strategic leadership, it is hard for an enterprise to achieve satisfactory performance given the global economic challenges(Rowe, 2001). Strategic leadership thus critical to a firm’s success and should be inculcated in all levels of management.
The first role of strategic leadership is creating and communicating the company’s vision for the future. This is the work of senior leaders in the organization (Lindsay, 2014). In the study on the key competencies required for effective leadership, a tangible vision, values, and strategy was cited as the top-most. In the case of Good Samaritan Hospital, The vision was providing exceptional patient experience in a way that would elicit superior outcomes (Lindsay, 2014). A vision dictates where the enterprise is headed. The vision is then promoted throughout the organization via email, newsletters, seminars, videos, talks and personal interactions. Strategic leadership ensures that the employees are aware of where the company should be. It presumes that there is a shared vision of that organization, so that any emergent strategy process and the day-to-day activities are consistent with that vision(Rowe, 2001).
Strategic leadership ensures the alignment of attitude towards the vision by picking teams wisely and motivating those teams towards achieving the vision. Rowe pinpoints that the most important work of a strategic leader is influencing employees to make decisions that enhance the organization voluntarily. Good Samaritan ensures that all leaders know what is expected of them and that both patients and stakeholders are at the core of the leadership system. (Lindsay, 2014).When employees and managers are aware of the company’s vision and direction, they may inadvertently make decisions that are detrimental to the achievement of that vision (Rowe, 2001). Strategic leadership ensures that teams with the right competencies and goals are chosen to drive the company towards the goals. It also ensures that a motivating environment in which the employees can work meaningfully and productively is provided(Lindsay, 2014).
Wealth creation is also a major role of strategic leadership. The primary goal of most organizations is wealth maximization. Strategic leaders make decisions that affect the financial stability and future viability of organizations positively. They achieve above average returns. (Rowe, 2001).Through its leadership model, for example, Good Samaritan has increased revenues such that the uninsured population can access diagnostic tests and treatment without charge. Strategic leaders invest strategically in research and development, advertising, capital equipment and employees. All these combined lead to increased revenues.
Bureaucracy in creativity and innovation, communication, and leadership stifle growth. Strategic leadership eliminates all these drawbacks to growth. Effective leaders create and maintain adaptive capacity and absorptive capacity essential for navigating today’s hyper-turbulent environments. (Lindsay, 2014). They also promote learning and innovation by creating a rationale for intelligent failure. These leaders design communication infrastructure and structures for individuals to share ideas, experiences and practices (Crossan, 2004). In Good Samaritan, bureaucracy is reduced by establishing stretch goals in the SPP,which prompt associates to innovate, improve and learn through the Performance Improvement System. Communication systems are also used to inspire employees and raise the bar. (Lindsay, 2014).
Besides reducing bureaucracy strategic leadershipinculcates a learning culture in the organization and ensuring the sustenance of this culture. (Lindsay, 2014) (Crossan, 2004). Strategic leaders build on the values of transparency, accountability, continuous learning, issue orientation and business ethics. Such values assure that performance excellence is continuously pursued. Leaders infuse ethical value systems into an organization and demonstrate integrity through action. Their ethical behavior dictates how others perceive the organization. The impacts of ethics mindfulness are quite profound. When strategic leaders act as role models for others, those values become a part of the corporation’s traditions. Adhering to ethics improves not only the organization’s status but also reduces the costs of oversight, regulation, and ethical failure. (Terry Thomas, 2004). The case of Alcoa best highlights the effects of strategic leadership on business ethics and profitability. In the 1980s, the company was facing five years of unprofitability and an employee injury rate of 12.8% per year. The causes of the problems were an apparent lack of accountability, low employee morale, inadequate leadership and poor quality control. The company changed management, but poor company culture, ethics, and accountability led to the closure of the company in 2001 (Lindsay, 2014).
Corporate Social Responsibility (CSR) is another important role of strategic leadership. Strategic leaders add value not only to the organization, but for customers and other stakeholders as well. CSR is embodied in the Emotional Intelligence Theory of leadership where empathy and social skills are emphasized. CSR has become a competitive necessity and a strategic imperative especially in the wake of increasing corporate scandals. Studies evince a positive relationship between business performance and CSR (Lindsay, 2014). Good Samaritan Hospital recognizes the need for CSR. It reduces the environmental effect of its activitiesby multiple energy conservation and material recycling measures. The hospital also provides healthcare for those who are not able to pay in a bid to improve societal well-being.
Crossan, D. V. (2004, April 1). Strategic Leadership and Organizational Learning. Academy of Management Review, 29(2), 222-240. url: http://amr.aom.org/content/29/2/222.full. doi:10.5465/AMR.2004.12736080
Lindsay, J. R. (2014). Managing for Quality and Performance Excellence. Mason, Ohio: Thomas-Southwestern.
Rowe, W. G. (2001, February 1). Creating wealth in organizations: The role of strategic leadership. Academy of Management Perspectives, 81-94. url: http://amp.aom.org/content/15/1/81.full.pdf+html. doi:10.5465/AME.2001.4251395
Terry Thomas, J. R. (2004, May 1). Strategic leadership of ethical behavior in business. Academy ol Management Executive., 18(2), 56-66. url: http://amp.aom.org/content/18/2/56.full.pdf+html. doi:10.5465/AME.2004.13837425
In The Parable of the Green Lawn, MR. Fast N. Furious exhibits some behaviors consistent with the business world. Mr. Fast does buys the most expensive seed that he then scatters around. Mr. Fast relies too much on quality. Total Quality Management does not always work because in as much as quality is an essential part of business, many companies focus too much on it that it overshadows the real reason the company is in business (Harari, 1997). An enterprise should balance between quality and its core objectives.
Mr. Fast n. Furious also fails to remove the weeds in his plot of land that makes the grass grow un-proportionately and inconsistently. His behavior can be attributed to the failure of companies in streamlining processes before effecting change. Alignment and integration of processes are critical to performance excellence. Integration harmonizes resource decisions, processes and plans to the achievement of organization-wide goals. Well-aligned organizations have processes that accomplish goals through sound strategy and efficient deployment (Lindsay, 2014). The failure to remove weeds leads to the inadvertent failure of the lawn to grow evenly and consistently.
When Mr. Fast notices that Ms. Steady’s lawn is growing uniformly, he attributes this to Steady’s lawn being watered every evening. He thus instructs her children to water his lawn, albeit in the afternoon. Most companies fail to decipher the reason for their failure accurately. They also copy other companies without gauging whether the new measure is compatible with their business. Competitive intelligence is aimed at gaining competitive advantage through planning and focus, collection, analysis and communication of intelligence. The requisite processes and structures have to be in place for it to work well. The failureof these processes leads to the acquisition of intelligence that may be detrimental to one’s company (Pienaar, 2008).
When things do not work out well, Mr. Fast blames everything else around him but himself. He blames his children for failing adequately to water the lawn, poor soil, and insufficient sunlight. He fails in self-assessment. In self-assessment, one should prepare to be humbled. It is hard to believe that the performance levels are as low as they appear, but this should not be a cause to blame others (Lindsay, 2014). Managers should recognize their contribution to the organization’s failure and rectify it. Mr. Fast instructed his children on how to water the lawn and should thus not blame them.
Ms. Slo N. Steady excels in maintaining her lawn. She does all the necessary things, and this can be attributed to her having grown up in the country. She exhibits what many companies bank on, a healthy organizational culture. Barney opines that firms that do not have the required cultures cannot engage in activities that generate sustained superior financial performance. He cites good corporate culture as one of the main contributors of sustained competitive advantage for most firms(Barney, 1986).
Ms. Slo does her work slowly and finishes several days after her neighbor. She, however, adheres to all the processes required for lawn maintenance. One of the main reasons for corporate failure is the impulsion for short-term rather than long-term profits. Ms. Slow designs her processes such that even though they do not achieve short-term results, the long-term results are vivid and long-lasting. Performance is a recurring theme in most branches of management. Evidence suggests that companies that go for long-term profitability can sustain their growth and sustainability better than companies going for short-term profitability (Ramanujam, 1986).
Ms. Slo also instructs her children to water the lawn during the evening. She recognizes the role that mid-level management and other employees play in the attainment of the organization’s goals. Employees and middle-level managers are critical to the achievement of a firm’s objectives. They implement all the policy decisions of the top level managers and oversee the day-to-day working of the company. The relationship that top-level management has with the employees dictates how employees carry out their duties. Motivation and reward are necessary for increased productivity. Of equal importance is a review and monitoring of employee duties (Organ, 1983).
Lastly, after Ms. Slo wins the wager, she does not relax. With the added time arising from her lawn requiring minimal maintenance, she concentrates on landscaping. The combination of the lawn and maintenance wins her additional accolades and awards. It is evident from the above that growth is a continuing process. The achievement of one goal should not curtail the realization of the others. In order to sustain competitive advantage, companies need to innovation and create new avenues on which to compete. Vorhies and Morgan posit that sustainable competitive advantage is often curtailed by the tendency of markets to dwell too much on past achievements rather than focusing on the future growth of the company(Morgan, 2005).
Harari, O. (1997, January 1). Ten Reasons TQM Doesn’t Work. Management Review, 86(1). Retrieved March 04, 2015, from https://www.questia.com/magazine/1G1-19037501/ten-reasons-tqm-doesn-t-work
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Pienaar, A. S. (2008). Competitive intelligence: construct exploration, validation and equivalence. Aslib Proceedings, 60(4), 383 – 411. url: http://www.emeraldinsight.com/doi/full/10.1108/00012530810888006. doi:http://dx.doi.org/10.1108/00012530810888006
Ramanujam, N. V. (1986, October 1). Measurement of Business Performance in Strategy Research: A Comparison of Approaches. Academy of Management Review, 801-814. url: http://amr.aom.org/content/11/4/801.full. doi:10.5465/AMR.1986.4283976