Cornerstone College of International Studies (CCIS)
LINK BETWEEN STRATEGIC MANAGEMENT AND LEADERSHIP
The link between strategic management and leadership
Management and leadership must be intertwined to achieve the goals of the organization. Strategic management is the organized development of resources in all the functional areas of a company. The functional areas are financial and management manufacturing among others. Strategic management is a set of policies that the management of a firm or organization adopts and guides the direction of the entity. It takes into account the environment which the entity is operating in. In other words, strategic management aligns with the organizations mission and goals through effective utilization of the resources. Leadership, on the other hand, is the guiding of an organization towards the desired result. It also takes into account the desired mission and vision of the organization. It works on the precedence of strategic planning and management in order to achieve long-term success.
Strategic management and leadership are linked in that leadership is the bridge between strategic management and the desired results. Through leadership, a firm or an organization is able to achieve its set mission and goals. Strategic management is how the top managers formulate and implement the objectives of the company. Leadership, on the other hand, involves leaders influencing the subordinates to make their own decisions for the improvement of the organization. It is worth noting that neither of these two aspects is self-sufficient when it comes to the attainment of organizational goals. Apart from that, management and leadership should be effective for the success to be realized at the end. Ineffectiveness in the core components of the organization may result in failure of the business. The organization is productive when both management and leadership coordination are effective. While the managers come up with innovative ideas for the future prosperity of the organization, it is the duty of the leadership personnel to implement the ideas by influencing their minors positively and coaching them in order to actualize the ideas.
Leadership style refers to the way in which the leaders motivate employees, implement plans and also give guidelines on how duties and responsibilities should be carried out. There are various types of the leadership styles that can be adopted in different scenarios depending on the strategic decisions put in place by the top management. These leadership styles include transformational leadership, charismatic leadership, transactional leadership, situational leadership and laissez-faire leadership style. Leaders lead people while managers manage people. Leaders are the people that bring changes in an organization while managers sustain the changes in the organization.
Transformative leader constantly shares the vision of the organization with the employees. This kind of a leader usually delegates some of the responsibilities to the subordinates and gives them the authority to execute their decisions deemed necessary for the success. Another type of the leadership style is charismatic leadership. In this case, the leader influences the subordinates by use of enthusiasm. The presence of this leader symbolizes motivation to the workers and he/she is always in a position to encourage the employees to work toward the set goals. Unfortunately, a leader who is charismatic tends to believe more in himself/herself than he/she believes in others. This can be a major drawback to the strategic decisions. The subordinates may feel reluctant to go on with their duties when their leader is in absentia. It is, therefore, logical to say that decisions cannot be effectively made without the leader’s direct oversight. To avoid this, there is a need for a great deal of responsibility and commitment on the part of the leader in question for the success of the organization.
The other type of leadership style is transactional leadership. It is a two-way traffic where the leader expects obedience from the subordinates and in return the employees may have either rewards or punishments based on their obedience or disobedience respectively. This type of leadership is mainly applied in short term tasks as it can be very disastrous for strategic goals. Employees may develop unrests and demonstrations due to strict measures brought about by the transactional leader.
Nowadays, situational leadership style has become the most adopted one among the leadership styles. It stresses that there is no particular way of dealing with a situation. For a strategic decision to be made there must be consideration of some aspects such as the personality of the leader, the skills of the employees and the kind of work involved. The leader in most cases uses intuition to make decision, hence, resulting in high personal judgment in decision making.
Finally, strategic decisions can be affected by laissez-faire leadership style. The leader delegates all the authority to the subordinates. Consequently, employees have freedom to execute their own decisions without having to consult their leaders first. This can affect the strategic decisions in two ways. First, the employees may misuse the authority delegated and fail to implement the decisions. Second, highly self-motivated employees may appreciate the honor of being delegated the authority and put more efforts in accomplishments of the goals of the organization.
Adaption of leadership styles to different situations
Adoption of the leadership styles depends on the situation at hand. This means that a leader is supposed to apply different leadership styles depending on the situation at hand. Both transformational and transactional leadership can be applied in the organization that is involved in routine activities. Transformational leadership requires employees to be motivated in order to add value to the company. Charismatic leadership can be applied where the subordinates are less skilled or in a situation where there is a need for motivation to improve their performance. Also, for this kind of leadership to work, the leader himself/herself must be very skilled and committed to serving. Where subordinates are skilled and highly motivated, laissez-faire type of leadership can successfully fit the situation. The employees need little or no supervision in order to carry out their duties. Situational leadership is applicable in almost every situation. It is the best kind of leadership to adopt as the corporate world is now ever changing.
Application of management and leadership theory to support organization direction
The impact of selected theories of management and leadership on organizational strategy
Many behavioral scientists have come up with various theories of management and leadership. These theories include Hersey and Blanchards situational leadership theory, Vroom and Yetton leader participation model, and Tannenbaum and Schmidt theory of continuum of leader behavior. Situational leadership theory argues that the leader makes decisions depending on the readiness and acceptability of the workers. Organizational goals can take long before they are achieved. Complex strategies will put employees under pressure and they are likely to refuse the responsibility to execute them. In addition, the dynamics of the environment may disrupt the implementation of the strategies. This is because the expected progress of the strategies may not match with the actual progress while implementing this strategy. The theory of Leader participation suggests that the leader behavior should reflect the task structure. There must also be guidelines to indicate the degree in which his/her followers will be involved in decision making. These determinants of participation may include group expertise or leader expertise. If the leader is highly skilled, there is more need for him to participate in the implementation of the strategies. On the other hand, if the group has the necessary expertise to implement an organizational strategy, the leader will definitely have little participation. Other contingencies that may determine the leaders participation may include group support, decision significance or likelihood of commitment from the followers.
Vroom, a social scientist, came up with another version of leader participation in the achievement of the organizational goals. He argued that the leader formulates an idea with the assistance of his/her followers and then leaves it to his/her subordinates to actualize it. In other words, the leader presents the problem to the subordinates and acquires some suggestions before making a decision. This might be highly useful in the implementation of organization goals because everybody is involved in the decision-making process despite that they cannot make decisions themselves. Several ways can be used to get suggestions from the employees. The leader may consult the people individually or in a group where he/she can even be a facilitator. The continuum of leader behavior theory suggests that the authority of the leader decreases as the subordinates participation increases. Eventually, every member of the organization is involved in the strategy implementation. Success is realized quickly as much effort is put together for a common goal.
Leadership strategy that supports organizational direction
The leader spends a substantial amount of time on strategizing. The leader must come up with a strategy that will streamline with the goals of the organization. For instance, the leader may create an emotional intelligence management strategy. This is a forum where employees may recognize their feelings toward work, their own feelings and also understand what motivates them. This is crucial because it has a direct impact on the job performance, mental health and working relationship in the organization. Management of employees emotions facilitates their concentration on their duties, hence, results in high productivity and good performance. The relationship between the senior and the subordinate improves as the leader constantly motivates his/her followers through this strategy.