Concept of Strategic Leadership
One of the key strategic roles of any manager, whether general or functional, is to provide strategic leadership for subordinates. Strategic leadership refers to the ability to articulate a strategic vision for the company and to motivate others to buy into that vision. Strategic leaders meet six criteria.
- Strategic leaders have a vision of where the organization should go, are eloquent enough to communicate this vision to others within the organization in terms that energize people, and consistently articulate their vision until it becomes part of the culture of the organization.
- Strategic leaders demonstrate their commitment to their vision by actions and words, and they often lead by example.
- Strategic leaders are well informed, developing a network of formal and informal sources of information that keep them well apprised of what is going on within their company. They develop “backchannel” ways of finding out what is going on within the organization so that they do not have to rely on formal information channels.
- Strategic leaders are skilled delegators. They recognize that, unless they delegate, they can quickly become overloaded with responsibilities. Besides, they recognize that empowering subordinates to make decisions is an effective motivational tool. Empowerment also makes sense when it results in shifting decisions to those who must implement them.
- Strategic leaders are politically astute. They play the power game with skill, preferring to build consensus for their ideas rather than use their authority to force ideas through. They act as members or leaders of a coalition rather than as dictators. Recognizing the uncertain nature of their forecasts, they commit to a vision rather than to specific projects or deadlines. They also realize that a big change may be more easily implemented in small, piecemeal steps.
- Strategic leaders exhibit emotional intelligence, which includes self-awareness, self-regulation, motivation, empathy, and social skills. Leaders who exhibit a high degree of emotional intelligence tend to be more effective.
Strategic Leadership Levels
Strategic leaders manage the strategic management process that is designed to help the organisation achieve its objectives.
Among the strategic leaders, we have managers operating at different levels of an organisation: corporate-level, business-level, functional-level and operational-level. At these four key levels, strategic leadership provides the scope and direction to help drive success for the organization.
- Corporate-level managers include the chief executive officer (CEO), senior executives and the corporate staff. The corporate-level managers manage the strategic management process for the whole organisation. These managers may carry designations such as CEO, managing director, executive director or president.
- Business-level managers are the strategic leaders at the business, division or SBU levels. These managers manage the strategic management process at the business-level. These may carry designations such as general manager or vice-president.
- Functional-level managers are the strategic leaders of specific functions such as marketing or operations. They are called marketing managers or operations managers. The functional managers manage the strategic management process at the functional level.
- At the operational-level, there are managers who are responsible for the implementation of strategies within their assigned functional areas. They occupy positions such as deputy manager of marketing or assistant manager of operations.
The Tasks of Strategic Leaders
- Determining Strategic Direction: One of the more crucial tasks of a strategic leader is to provide a sense of direction to the organisation. The strategic direction is concerned with the future shape of the organisation.
- Effectively Managing the Organisational Resources Portfolio: Strategic leaders are called upon to manage effectively, the portfolio of organizational resources. Such a portfolio includes financial capital, human capital, social capital and organizational capital.
- Sustaining an Effective Organisational Culture: Strategic leaders try to build and sustain an effective organizational culture.
- Emphasizing Ethical Practices: Strategic leaders emphasize on ethical practices in word and deed when the strategies are being implemented.
- Establishing Balanced Organisational Controls: Strategic leaders use a combination of financial and non-financial controls to help the organisation achieve its objectives.
The Roles of Strategic Leaders
- Role of Chief Executive Officer: The role of the CEO is evident through all the phases of the process of strategic management. A CEO performs the strategic tasks: actions which are necessary to provide a direction to the organisation so that it achieves its purpose. He plays a pivotal role in setting the mission of the organizations, deciding the objectives and goals, formulating and implementing the strategy and, in general, seeing to it that the organisation does not deviate from its pre-determined path, designed to move it from the position it is in to where it wants to be.
- Role of Senior Managers: The senior (or top) management consists of managers at the highest level of the managerial hierarchy. Senior managers perform a variety of roles by assigning the board and the chief executive in the formulation, implementation and evaluation of strategy. Organisationally, they come together in the form of different types of committees, task forces, work groups, think tanks, management teams and the like, to play a very important role in strategic management.
- Role of Business-Level Executives: The rationale for organizing structure according to the strategic business units (SBUs) is to manage a diversified company as a portfolio of businesses – each business having a clearly defined product-market segment and a unique strategy. The business-level executives, also known as either profit center or divisional heads are considered as chief executives of a special business unit. The business-level strategy formulation and implementation are the primary responsibilities of the business-level executives.
- Role of Functional and Operational Managers: The major role of functional and operational managers, also called the middle-level managers to relate to functional and operational matters and therefore they rarely play an active role in higher-level strategic management. They may, at best, be involved as ‘sounding boards’ for departmental and operational plans, as implementers of the decision taken by the corporate- and business-level managers, followers of policy guidelines and passive receivers of communication of functional strategic plans.
- Strategic Leadership: Short-term Stability and Long-term Viability (Ivey Business Journal)