Professional Documents
Culture Documents
Table of Contents
Ansoff and McDonnell (1990), “on the subject of strategic management, provided the following
definition”: “…strategic management is a systematic approach for managing strategic change,
which consists of the following:
As Ansoff and McDonell (1990) noted that, this definition “favors an adaptive approach to
strategic management, where it is important to watch the process in operation and make
appropriate changes as soon as possible. Thus, initiating short-term responses are an integral part
of strategic management as well as preparing for the future”.
According to Majella (2008), “a leader guides the organization to achieve the vision and goals
that the entire team has agreed to”. “Although, leadership is considered to be a facet of a
successful manager”. Majella stresses that “leadership mostly often than not works on
precedence for strategic planning and management and long-term success. Leadership is a skill
that a person develops through experience and strategic management through learning and
trainings”.
Leadership in past was considered as an innate human characteristic and focused only on those
leaders who were known to have this characteristic. However, unlike past, the focus on
leadership today is not only on the leaders alone, but on the employees and followers as well.
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Luthans & Avolio (2003) introduced the concept of “authentic leadership”, which suggests that a
leader should motivate employees by listening to their opinions and considering their ideas in
decision-making process. A leader can influence his employees and improve their performance
so that they can achieve organizational goals and objectives.
Employees should go through proper leadership training programs so gain knowledge on how to
use those skills in various different situations that occur in the business world, while, the frm
should stress on these development-training programs. Development of leadership skills at every
level of organization insures long-term sustainable growth and success for an organization
Effective leaders are those have influence and are considered as role model by their followers,
and those who use leadership styles that best fits the situation at hand. They increases the morale
in the organization by making their followers feel self-worthy and confident and by giving them
chances to participate in the decision making processes, which results in more committed
employee behaviour and ensures organizational success.
Leadership aligns strategic management and the set goals and targets in an organization and
helps in achieving those goals and objectives. On the contrary management is responsible for
resources, tangible and non-tangible, in a division according to the rules or values that have
already been set out while the leadership sets a direction for people in that organization.
Organizations are able to set direction and allocate resources when there is synergy between
effective leadership and effective management. Not only that, an organization is able to achieve
their goals the way they have envisioned and the way they have desired to achieve.
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“The organizations that implement strategic business management perform better than firms who
do not” (Wheelen & Hunger 2005). Strategic management leads to a competitive advantage for a
company by helping in the identification of a firm’s goals and the strategies used to achieve the
goals. It helps integrate all business units to, ultimately, achieve that common goal. Strategic
management helps organization in anticipating the changes, and making strategies according to
the changing environment and changing market demands. The implementation of any strategy is
done while keeping in mind the turbulent environment, competitors, and the business’s
resources. “It is beneficial that the company observes the changing demand pattern of consumers
and accordingly make strategic decisions to accommodate those changing demands, thus, leading
an organisation towards profit maximization and increase growth prospects” (Baum & Wally
2003). The strategies are, therefore, evaluated, after they have been implemented, to make
changes where required
Kotter (1990) suggested, “That management develops plans and strategies that focus on
execution of the organizational strategy, while a leader maintains human resource; it directs the
employees, control, coordinate and motivates them to execute that strategy with their best
performance in order to accomplish the missions of the business”. The leadership and
management styles applied can significantly affect the strategic decisions, thus, a right leadership
and management style is needed while making a strategic decision. For example, a directive
management style is applied where employees need to be controlled and monitored closely.
Affiliative management style is applied where the focus needs to be on employees. This style
puts harmony, teamwork among employees, and puts them over tasks. A right leadership style is
a requirement for an organisation to be successful. If the right leadership styles are not followed,
when needed, the organisation would not be able to achieve its business objectives and it will
lead to failure of strategic decisions. Therefore, organizations should know which leadership
style should be used for different kinds of strategic decisions. The business environment is at its
most competitive stage now; as a result, it is essential for organizations to use best leadership and
management practices to stay on top of the game.
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For example, democratic leaders trust their subordinates and urge them to participate in the
decision-making processes. This style requires good top-bottom and bottom-top communication
flow in the organization and it emphasizes that managers should be willing to encourage
leadership capabilities among the employees. Democratic managers and leaders, who adopt this
management style, delegate authority to their subordinates and listen to their subordinates’
opinions on organizational matters. The ultimate democratic system occurs when actual
decisions are made based on the views of considerable number of employees. .
Many different situations occur in organizations on a daily basis and these situations require to
be handled professionally, applying the right leadership or management style to get the desired
outcome.
“Leading from the front is a style in which leader is on top because his performance is the one
which makes difference. This is an illustration of transformational leadership style where people
follow the person who inspires them the most” (Cossin & Caballero). Transformational leader
has the ability to be intellectually stimulating by encouraging creativity and innovation among
his followers while formulating potential solutions to organizational problems. “By allowing
subordinates to participate in an unrestricted fashion, a transformational leader is able to stir their
imagination in a way that promotes the swift identification of problems and development of
high-quality solutions that are implemented with the full commitment of followers. Given that
much of the transformational leader's time is spent trying to convince followers to transcend their
personal interests for the sake of the larger organization, idealized influence, charisma,
individualized consideration and intellectual stimulation are essential” (Cossin & Caballero
2015).
The level and type of employee participation may vary in business environments. A form of
participatory leadership is representative participation where groups of employees are involved
in organizational decision-making. “This form of participatory leadership is practiced
dominantly in Europe, where employees may serve on labour councils or even on the board of
directors. Another form, more common in the US, is participatory management where employees
share a degree of joint decision making with their immediate supervisors” (Grimsley 2015). For
example, a self-managed work team would be responsible for a specific product, having the
authority to make decisions relating to the product scheduling, purchasing materials, and
recruitment.
Bass and Avolio (1994) noted that, “Transformational leadership is a type of leadership that must
accompany good management”. In contrast to other leadership models, transformational
leadership goes beyond the process of exchange between a leader and followers. “It not only
aligns and emphasizes the needs and values of followers, but also provides intellectual
stimulation and increased follower confidence”. Bass and Avolio (1994) identified the “four ‘I’s’
that need to be employed by transformational leaders to achieve superior results”. These are:
i. “Idealized Influence: Transformational leaders must act in ways that result in admiration,
respect and trust from followers, and ultimately becoming a role model. A
transformational leader exhibits high standards of ethical and moral conduct” (Bass &
Avolio 1994).
ii. “Inspirational Motivation: A transformational leader can actively promote team spirit by
demonstrating enthusiasm and optimism. He motivates and inspires followers to share in
and work towards a common goal” (Bass & Avolio 1994).
and creative side, by being supportive, reframing problems and questioning long-standing
assumptions” (Bass & Avolio 1994).
“Transformational leadership theory can have great affect organizational strategy. If a firm is
following a cost leader-ship or a differentiation strategy, then it cannot afford high turnover rate
because it is costly to train employee, similarly with the differentiation strategy; human resource
is an asset to the organisation and therefore, it cannot afford to lose its asset. Thus, a leader
motivates employees to perform well and in doing so becomes a figure of inspiration and
motivation for the employees, which decreases the turnover rate in a firm” (Jiang 2002).
“Purely charismatic leaders may be limited in their ability to achieve such successful outcomes,
due to their need to instill their personal beliefs in others, which may prevent individual growth
of the followers. However, transformational leaders are more than charismatic because they
generate awareness of the mission and vision of the team and of the organization, and then
motivate colleagues and followers towards outcomes that will benefit the team rather than simply
serving individual interests” (Hoye et al 2015).
2. Contingency Leadership:
Some leaders put in effort to get to know their employees, whereas, others focus only on getting
the job done. “Fiedler's contingency theory can help explain why some leaders can behave so
differently than others can. Fiedler's contingency theory states that there is no one single
leadership style that works for all employees. He emphasized that there are situational-contingent
factors that affects a leader's ability to lead his followers” (Daft 2014). “The effectiveness of
employees depends on how great a match exists between the leadership style of the leader and
the demands of the situation. This result in two factors: leadership style and situation
favorableness (or situational control)” (Manktelow & Edwards 2015).
“The Fiedler Contingency Model questions us about our natural leadership style, and the
situations in which that style will be most effective” (Daft 2014). The model states that leaders
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are either task-oriented, or relationship-oriented. Once they understand their style then they can
match it to situations in which that style is most effective.
Thus, “there is no one best way or approach in management or doing things, different situation
calls for different approach to handle, manage, and solve the rising issues concerned.
Management and organization are an open system, which welcomes anomalies or challenges
every now and then, which requires adaptable and situational solution in order to overcome or
solve the problem and issue. Other situational or contingency factors involve changes in
customer demand for goods and services, changes in government policy, change in environment
or climate change, and so on” (Hai, Ibrahim & Nawi 2012)
3. Transactional Leadership:
Transactional leadership operates on the assumption that employees will better perform if it is
related to their self-interest. Therefore, this leadership style is based on a theory of reward and
punishment. This theory can be used to achieve organizational strategies by giving the directions
or task to the employees and on the basis of their performance they should be rewarded or
punished. This leadership style can be used in situations where problems are clearly defined, so
the employees can be asked to find out solution of the given task. The employees, in this case,
are not allowed to give their opinion and find alternative ways of problem solving other than
directed by the leader (Bass 1985).
This leadership style can achieve organizational strategy of companies that require less creative
ideas from their employees and their work environment is standardized and stable. They have
proper procedures or standardized rules and regulations, which does not promote employee
participation in decision making for example manufacturing companies, pharmaceutical firms
etc.
and interfere only when an employee is not meeting the desired expectations, often resulting in a
punishment. On the other hand, a transactional leader who uses active management by exception
will monitor employee performance closely, note slight deviations and quickly interfere to take
corrective measures to prevent any further mistakes” (Hartzell 2015).
“Top organizations around the world state that there is a direct relationship between their
leadership strategy and their business strategy” (Bersin 2015). Regardless of who the chief
executive may be, the operational executions takes place at the mid-level and supervisory level
in an organization. “When these employees are mentored, trained, and well aligned, the business
thrives. Successful companies understand this phenomenon, therefore, they build leadership
development programs, which exclusively trains, supports, and picks people who drive their
business’s strategy. By doing so, they instill execution into their organizational culture. A great
example of this is UPS. It is a company that has outperformed other express companies for many
years and it has continued to transform itself from its origin as a delivery company run by a horse
and a buggy. The company promotes from within and continues to promote a leadership culture
of customer service, safety, and entrepreneurship” (Bersin 2015). If chief executive UPS were to
be replaced, the newly hired one would come into a company with a deep-seated leadership
culture. At times, the deep-seated culture may need to change when a new leader is required to
bring in different types of innovation and creativity to the organization’s management team.
Superior companies understand that application of strategy takes place at the grass roots level.
Those who get things done are the front line managers, supervisors, and middle managers who
make things happen. If the leader does not push his or her leadership strategy towards the
employees effectively, it will not take hold. Research shows that the best companies develop
leaders from the bottom up. Like a reverse pyramid, senior managers serve the needs of line
managers.
leadership development programs than their peer companies. In addition, these programs are
uniquely multi-faceted and stimulating.
(Leithwood 1992). Transformational leaders should take the following steps to avoid issues and
complications during restructuring:
It is a leader’s duty to align structure and strategy to avoid all future misunderstanding. All
restructures must align to strategy. Although this may appear obvious thing to do, yet a
remarkable number of organizations fail to do so. For example, if local conditions are a major
factor then stress local sales and marketing functions rather than a centralized organization,
which then tries to organize with local elements.
It is important to focus on core activity by removing noise (inefficiencies) and enhancing core
activities before restructuring roles. This means the leader will need to know what his followers
are doing by obtaining a detailed understanding of their duties of roles. This ensures that no
significant activities are discarded when removing a role. Similarly, there should be removal of
redundant activities during the time of restructure.
There should be creation of feasible roles. Organizational restructures commonly leaves fewer
people to do the same amount of work. Subsequent workload on the remaining employees should
be understood while reducing the number of employees during a restructure. This helps to ensure
that roles are designed neither too heavily burdened nor too light. Furthermore, role should be
designed taking realistic combination of skills into account. Packing a role with too many
individual skill sets reduces the pool of suitable candidates.
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Finally, it is important not to cut resources too fine and maintain flexibility. If the organizational
change is quantifiable, resource flexibility is needed in the first few months, so even as a leader it
is important to strive to operate more efficiently, by leaving some room in staffing. Flexibility
applies both to staff members and staff capability. A leader should leave himself and his
leadership team some room to respond to capability gaps following a restructure.
It is well known that the current business environment is turbulent; therefore, the best leadership
style is the one that is the most adaptable to changing situations, involving a leader who is
willing to display a flexible style that best fits into any situation. In business, ultimately it is the
results matter.
When an organization is going through good times, a leader should be democratic, visionary and
a coach. When things are going well, and there are several different potential paths to achieve
goals and objectives, it is important to have one on one with employees to talk things out and to
assess who has the most to contribute in different areas. Being a visionary requires that the leader
has a plan and he has to sell everyone else on it. He has to be the one who is already doing price
and sales projections. If a leader can articulate a clear plan for the future of the firm, it influences
everyone around. By being a coach, the leader has to simply stay on the course and resist the
temptation of implementing new plans just to be doing something, and wait for the best time to
arrive to make any further plans. Until then, it is time for performance reviews, group
discussions, reorganizations, and other attempts to get employees and organization’s efficiency
up further. Focus should be on the human level by maintaining person-to-person connections to
keep the team focused.
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Formal training is crucial in improvement of leadership skills that involves the needs of
recruitment. Although leaders learn mostly through practical experience, however, there are the
certain things that improves the capability of leaders and improve their skills. A good leader
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needs to have the capability to analyze the future needs of his organization and take effective
actions while keeping those future needs in mind. Leadership is developed through formal
training, development activities and self-help activities.
Formal training is also used, where there is a situation to develop for a specific period for
example some organizations introduce workshops at training centers and universities to present
the courses that develop leadership skills. In training programs it is required to design effective
training courses containing clear learning objectives and helpful in development of self-
confidence of each individual. There should be activities that go along with the development of
these skills. “Most of the skills that are essential for effective leadership are learned from
experience rather than formal training programs” (Davies 1984). Special assignments provide an
opportunity for individuals to develop and polish leadership skills during the performance of
regular job duties.
Development activities involve special assignments, rotation of jobs, coaching and mentoring,
and personal growth programs. These activities are useful to both leaders and employees of an
organization. Implementing coaching and mentoring programs helps managers interpret their
experiences and learn new skills. Assessment methods include interviews, personality tests and
communicating exercises for the purpose of development. Job rotation programs tests the skills
of an individual employee by putting him in different departments for a specific period. In
addition, corporations apply self-help techniques to develop the skills of individuals. “Evidence
from a study shows that consideration for leadership skills development results in better
performance for the organization”. (Yukl 2010)
Superior business performance and development of leadership capability are directly connected.
Organizations that capitalize in training their people as effective leaders and managers create a
sustainable competitive advantage in this increasingly turbulent and competitive business
environment. Training and coaching enhance global and sustainable perspectives, which directly
affects the bottom line managers and increases performance. It positively affects leadership
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growth and firm’s performance, and impacts organizational change and characteristics of
leadership effectiveness. Development of leadership skills is useful in the promotion of a leader’s
self-awareness and problem solving skills.
V. References
Bass, B 2010, The Bass handbook of leadership: Theory, research, and managerial applications.
Simon & Schuster, New York.
Bass, BM 1985, Leadership and performance beyond expectations, Free Press, New York.
Baum, JR & Wally, S 2003, ‘Strategic decision speed and firm performance’, Strategic
Management Journal, vol. 24, no.11, pp.1107-1129.
Bennis, WG & Nanus, B 2007, Leaders: The strategies for taking charge. HarperCollins, New
York.
Bersin, J 2015, It's Not The CEO, It's The Leadership Strategy That Matters,Available
at: http://www.forbes.com/sites/joshbersin/2012/07/30/its-not-the-ceo-its-the-leadership-
strategy-that-matters/#2cd62835a3e7 (Accessed: 26 January 2016).
Davies, B 2003, ‘Rethinking strategy and strategic leadership’, Education Management &
Administration, vol. 31, pp. 295–312.
Grimsley, S 2015, Participative Leadership Style: Definition, Theory & Examples, Available
at: http://study.com/academy/lesson/participative-leadership-style-definition-theory-
examples.html (Accessed: 26 January 2016).
Hai, JC, Ibrahim, A & Nawi, NF 2012, Principles of Public Administration: Malaysian
Perspectives. Pearson, Kuala Lumpur.
Hoye, R, Smith, AC, Nicholson, M & Stewart, B 2015, Sport Management: Principles and
Applications, 4th edn., Routledge, New York.
Kotter, JP 1990. A force for change: How leadership differs from management. Free Press, New
York.
Schoenlaub, N 2015, It's not the CEO, it's the leadership strategy that matters!,Available
at: https://www.linkedin.com/pulse/its-ceo-leadership-strategy-matters-nicolas-schoenlaub?
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Wheelen, LT & Hunger DJ 2005, Management and business policy toward global sustainability,
Pearson, Delhi.