LEADERSHIP & ORGANISATIONAL

BEHAVIOUR
Lecture (unit) six:
LEADERSHIP and management
(groups, teams and interactions IN
ORGANISATIONS)
lecture OBJECTIVES

After completing this lecture, you should be able to:


discuss the meaning of, and distinction between
management and leadership.

assess the contribution of the theoretical approaches to
the study of leadership.

discuss the importance of leadership.

explain the meaning of management.

understand the principles and practices of management.

understand the contribution of strategic
leadership/management to understanding leadership and
management in organisations.
introduction

It has been suggested that to be an effective leader,

you must become one yourself. To know how people
behave takes intelligence, but to know yourself takes
wisdom.
Leadership is the art of accomplishing more than the
science of management says is possible.
Leadership matters. On a day-to-day basis,
organisational leaders profoundly affect where paid
work is performed, how it is performed, how people are
managed, how people experience their work, and how
managers and co-workers interact and respond to each
other.
WHAT ARE THE KEY ISSUES SURROUNDING LEADERSHIP
AND MANAGEMENT

1. What is the meaning of leadership?

2. Comparing leadership and management
3. Approaches to leadership
4. Importance of leadership
5. What is the meaning of management?
6. The role of strategic leadership/ management
in the management of organisation.
 KEY ISSUE 1: WHAT IS THE MEANING OF
Leadership
 There are many ways of looking at leadership and
many interpretation and its meaning. Thus, coming up
with a precise definition of leadership is difficult.
 Leadership might be interpreted in simple terms as
‘getting others to follow’ or ‘getting people to do
things willingly’ or interpreted more specifically, for
example as ‘the use of authority in decision-making’.
 Leadership involves influencing, motivating, and
enabling others to contribute to the effectiveness and
success of the organisations of which they are
members.
 THE MEANING OF LEADERSHIP

Leadership is “the process wherein

an individual member of a group or organisation influences
the interpretation of events, the choice of objectives and
strategies, the organisation of work activities, the motivation
of people to achieve objectives, the maintenance of
cooperative relationships, the development of skills and
confidence by members, and the enlistment of support
and cooperation from people outside
the group or organisation’
(Gary Yukl, 2002)
KEY ISSUE 2: comparing Leadership and management
 It would be usual, to describe a group of people
as having a manager unless the group is existing
in an organisational context.
 An informal friendship would not usually be
described as having a manager, yet we would
almost inevitably find a formal or informal
leader of such groups.
 The term leadership and management are
frequently used interchangeably, but are they the
same?
 Is a manager automatically a leader and do
leaders always manage?
LEADERSHIP VERSUS MANAGEMENT

Watson (1983) applied the differences

between leadership and management to the 7-S
organisational framework: strategy, structure,
systems, style, staff, skills and super-ordinate
(or shared goals).
According to Watson (1983) whereas
managers tend to rely on strategy, structure,
and systems (‘hard Ss’), leaders have the
tendency to use the ‘soft Ss’ of style, staff,
skills and shared goals.
Comparing LEADERSHIP and MANAGEMENT (figure 6.1)

Prominent
leadership
Theorist-
Kotter (1990)
compared
leadership
and
management.
LEADERSHIP VERSUS MANAGEMENT
Hollingsworth (1999) also suggested six fundamental
differences:
1. A manager administers – a leader innovates
2. A manager maintains – a leader develops
3. A manager focuses on systems and structure – a leader
focuses on people
4. A manager relies on control – a leader inspires trust
5. A manager keeps an eye on the bottom line – a leader
has an eye on the horizon
6. A manager does things right – a leader does the right
things
Key issue 3: LEADERSHIP in organisation –
theoretical approaches

There are a number of approaches to assessing

leadership and they include:
 Traits theories (traditional leadership
models);
 Behavioural theories;
 Situational and Contingency theories; and
 Other approaches to leadership
Traits theories

There are a number of trait theories and they

include:
 “Great man’ theory
 Traditional theories
 every situation, particularly in times of crisis,
Traits
“greattheories
men” (with the same characteristics
as successful leaders) would emerge to lead
through the difficulties (as at that time leaders were
predominantly men).
The Great Man theory is a 19th-century idea can be
largely explained by the impact of "great men", or heroes:
highly influential individuals who, due to either their
personal charisma, intelligence, wisdom, or political skill
utilized their power in a way that had a decisive historical
impact.
Trait theories

 The traditional theories assume that leadership

was a set of qualities or personal characteristics
and that distinguishes leaders from followers and
effective from ineffective leaders.
 For much of history, it was assumed that
leadership was a set of qualities or personal
characteristics (traits) that someone is born with.
These include:
 General cognitive capacity and skills (e.g.
intelligence, skills for solving complex problems)
 Internal locus of control
Trait theories cont’d

 Specific need structures (low need for affiliation,

moderately high need for achievement and need
for power)
 Integrity
 Emotional stability
 Self-awareness and confidence
 Interpersonal abilities and skills
 Physical attributes (particularly height, but also
perceived strength and attractiveness) (Stogdill,
1948,1974).
 High social status background
Trait theories cont’d

Other evidence suggest that four traits are shared by

most leaders.
 Intelligence – leaders tend to have higher
intelligence than their subordinate
 Maturity and breadth - leaders tend to be
emotionally mature and have a broad range of
interest.
 Inner motivation and drive – leaders want to
accomplish goals
 Employee centred – leaders are able to work
effectively with employees in a variety of
situations.
BEHAVIOURAL THEORIES

The behavioural approach to

leadership include:
The Ohio State University Studies
University of Michigan Studies
The Managerial Grid
Other behavioural dimensions
BEHAVIOURAL THEORIES

This behavioural approach shifted the focus away

from personal traits in leadership – the notion
that leaders are born – toward the investigation of
the behaviour of leaders, and the relationship
between leader behaviour and situational
factors.

This led to the Ohio State University and the

University of Michigan Programmes of research
(two leadership styles):
BEHAVIOURAL THEORIES cont’d

Two dimension emerged for the University

of Michigan University studies:
leader’s task –oriented behaviours such as
assigning work
and redesign activities
and people-oriented
behaviours such as
respect and support for followers).
BEHAVIOURAL THEORIES cont’d

Task behaviour (‘productive-centred’ and

‘task-centred’) focuses on the degree to which a
leader emphasises the importance of assigning
followers to tasks, and maintaining standards:
In order words ,’getting things done’
Relationship behaviour (‘employee-centred’
and ‘person-centred’) leadership styles describes
the extent the leader is concerned about his or
her followers as people: their needs,
development and problems, looks after
subordinates welfare and nurtures supportive
BEHAVIOURAL THEORIES cont’d

Similar studies - Ohio State University identified

two dimensions:
Initiating structures: describes the degree to which
a leader defined and structures his or her own role
and the roles of group members/followers toward
attainment of the group’s assigned goals.
The initiating structures leadership style is
essentially the same as the job-centred or task-
related leadership style – focuses on getting the task
done.
BEHAVIOURAL THEORIES cont’d

 Consideration: describes the degree to which a

leader’s behaviour is aimed at nurturing warm
relationships, work relationships, and
encouraging mutual trust and respect (friendly,
approachable and treats all group members as
equals) between the leader and followers.
 The consideration leadership style is essentially
the same as the employee centred or
relationship related leadership style – focuses
on meeting people’s needs and developing
relationships.
BEHAVIOURAL THEORIES cont’d

 Another leader behavioural dimension is

provided the basis for the well known
‘managerial grid’ model of leadership (Blake
and Mouton, 1964).
 This model is based on the idea that differences
in leadership approach are the function of two
factors which they named – concern for people
and concern for production.
 The 5 leadership styles are:
i. Impoverished management – low concern for both
people and production.
managerial grid

ii. Authority-compliance management – high

concern for production but low concern for people.
iii. Country-club management – very high concern
for people but with lower concerns for production.
iv. Middle of the road management – a medium
level of concern for both people and production.
v. Team management – very high concern for both
people and production
BEHAVIOURAL THEORIES cont’d

Other behavioural dimensions:

Autocratic style: describes a leader who
dictates work methods, made unilateral decisions,
and limited employee participation.
Democratic style: describes a leader who
involved employee in decision making,
delegated authority and used feedback as an
opportunity for coaching employees.
Laissez-faire style: described a leader who let
the group make decisions and complete the work
in whatever way it saw it fit.
Situation/contingency theories of leadership

 Situational and Contingency Leadership

theories (takes the view that the best style of
leadership depends upon the factors active in
the specific situation) include:
 Hersey and Blanchard’s situational (1982)
leadership theory
 Tannenebaum and Schmidt’’s (1973)
continuum
 Fieldler’s (1967) contingency model
 House’s path-goal leadership theory
Situation leadership:

 Hersey and Blanchard’s (1982) model employs two

dimensions: task behaviour and relationship
behaviour:
 Hersey and Blanchard(1982) also include: the degree
of followers maturity (or readiness), which refers to
followers’ ability and willingness to achieve a
particular task.
 Consideration of low or high in terms of relationship-
oriented behaviour or task-oriented behaviour is as a
result of the link or correlation between leader’s
behaviour and the maturity level of followers and an
adjustment of managerial occurs relative to the
development of the employees.
Hersey and Blanchard’s situation theory

Telling (high task-low relationship): the leader

defines roles and tells people what, how, when, and
where to do various jobs.
Selling (high task-high relationship): the leader
provides both directive and supportive behaviour
Participating (low task-high relationship): the leader
and followers share in decision making; the role of the
leader is facilitating and communicating.
Delegating (low task-low relationship): the leader
provides little direction and support.
situation theory

Which is further linked to follow readiness:

R1- People are both unable and unwilling to take
responsibility for doing something. Followers are not
competent or confident
R2- People are unable but willing to do what the leader
wants. Followers are motivated but lack the appropriate
skill.
R3- People are able but unwilling to take responsibility for
doing something. Followers are competent but don’t want
to do something.
R4- People are both able and willing to do what is asked
of them.
situation theory cont’d (Figure 6.2)
Tannenbaum and Schmidt’s situation and contingency theory

 Tannenbaum and Schmidt’s (1973) model utilise the

concepts of ‘boss-centred’ and ‘subordinate-centred’
leadership to represent a continuum of different
leadership styles.
 They express the power and influence of managers and
subordinates as factors determining the level of authority
and freedom for subordinates in any given context.
 The four styles usually described:
Tells: the leader identifies appropriate solutions to
problems and appropriate courses of action and thereafter
tells the subordinate what they are supposed to do.
Tannenbaum and Schmidt’s contingency theory
cont’d

Sells: the leader still decides upon the

appropriate course of action in any given
situation but attempts to overcome disagreements
and resistance among the workforce by selling
the decision to them.
Consults: the leader allows time for subordinates
to discuss the problem and present ideas and
solutions to the boss. These are then used by the
leader to make decisions which are then
announced to the subordinates.
Tannenbaum and Schmidt’s contingency theory

Joins: the leader defines the nature of the issue to be

decided along with the constraints and presents these
to the group. The leader then becomes part of the
group in finding and implementing acceptable
solutions.
Fiedler Model situation/CONTINGENCY
THEORIES:

The Fiedler Model assumes that leaders are whether

task oriented – focussed on accomplishing tasks, or
relationship-oriented – focussed on developing
good, comfortable interrelationships.
The effectiveness of both types of leaders depend
on leader’s position, the structure of the team task,
and leader-follower relationship (i.e. effective
group performance depended on properly matching
the leader’s style and the amount of control and
influence in the situation).
Fiedler Model

 Leader – member relations – the degree to which

the leader is trusted and liked by group
members, and their willingness to follow the
leader’s guidance.
 The task structure – the degree to which the task
is clearly defined for the group.
 Position power – the power of the leader by
virtue of position in the organisation and the
degree to which the leader can exercise
authority to influence reward and punishment,
or promotion and demotion.
 Fiedler Model

The situation will determine the leadership style that will be

effective. e.g. when the situation is unfavourable (poor leader-
member relations, unstructured task, weak position power) then
a task-oriented leader (low LPC score) with a directive,
controlling style will be more effective.
Use the least-preferred co-worker (LPC) scale. The leader is
asked to think about the person with whom he or she can work
least well ((the LPC) and describe the person adjective like
pleasant versus unpleasant and efficient versus inefficient.
Leader who describe LPC in positive terms (cheerful, pleasant
etc.) are high LPC or relationship oriented and those in negative
terms (unpleasant, gloomy etc.) are low-LPC or task oriented.
Fiedler Model (Figure 6.3)
 CONTINGENCY THEORIES: house PATH-GOAL THEORY

Has roots in the expectancy theory of motivation

(links between effort and performance, and
performance and value rewards).
This links leadership style with the work and
personal goals of employees as well as group and
organisational goals.
The leader uses the appropriate of four
leadership behavioural to help followers clarify
the paths that lead to work and personal goals.
CONTINGENCY THEORIES: house PATH-GOAL
THEORY

The four styles in the are:

Directive – used when the leader must
communicate expectations, schedule work and
maintain performance standards
 Supportive – used when the leader needs to
express concern for followers and create a
climate that demonstrate support.
The four styles in the are:

 Participative – used when the leader

wants to share decision-making authority
with others.
 Achievement-oriented- used when the
leader must set challenging goals for
followers , expect very high levels of
performance, and show strong confidence
in the followers.
Other approaches to leadership

The other approaches to leadership include:

Transformational and transactional leadership
Charismatic leadership
Value-based leadership
(a) Steward Leadership
(b) Servant Leadership
(c) Ethical Leadership
(d) Distributed/Shared Leadership
Leader/follower relationship
(a) Vertical Dyadic Linkage (VDL) Theory
(b) Leader-member exchange theory
Other VIEWS: Transformational leadership/transactional leadership

Transformational leadership – occurs when a

leader transforms, or changes his or her followers in
three important ways that together enable followers
to trust the leader and performing behaviours that
contribute to the achievement of organisational goals.
1. Transformational leaders increase subordinates
awareness of the importance of their tasks and
performing well in them.
Transformational leadership

2. Transformational leaders make

subordinates aware of their needs for
personal growth, development and
accomplishments.
3. Transformational leaders motivate their
subordinates to work for the good of the
organisation rather than exclusively for their
own personal gain or benefit.
Other VIEWS: transformation/transactional leadership

Transactional leadership occurs when a leader

motivates followers purely on exchanging rewards
for good performance and noticing and
reprimanding subordinates for mistakes and
standard performance.
This type of leadership is based on some sort of
contractual exchange (often implicit) between
leader and follower.
 Transactional activities include allocation of
work, making routine decisions, monitoring
performance and interacting with other functions
 The relation
Leadership between leadership styles and gender
and gender
has recently become an important topic of research.
Research indicate that:
 men tend to adopt transactional leadership
styles, and
 women tend to adopt the transformation
leadership style.
 Research further indicate women or feminine
leaders get unfavorable evaluations if they adopt
male-stereotypical leadership styles
Charismatic LEADERSHIP
Charismatic leaders – concern themselves with
developing a vision of what could be discovering or creating
opportunities, and increasing employees’ desire to control
their own behaviours.
Leaders rely on the power they obtain through followers’
identification with them. Leaders who are enthusiastic, self-
confident and whose personality influence people to
behave in certain ways.
Charismatic leadership could be a function of both leader
traits (e.g. self-confidence, skills in impression management
and social sensitivity) and situational variables (e.g. crisis
situation and high levels of subordinate dissatisfaction with
the current leadership).
 Value-based leadership/shared leadership

Value-based leadership is focused on expressing and

promoting particular pro-social values and they include:
 Stewardship leadership refer to the attitudes and
behaviours that place the long-term best interests of a
group ahead of personal goals that serve an
individual’s self interests
 Servant leadership is defined as leadership that has
service to others including followers as its main
motivator (trust, empathy, support, community
building, empowerment and follow development are
aspects particularly associated with such leadership).
Value-based leadership/shared leadership
 Ethical leadership is leadership that aligned
with a moral code that provides consistency
among the ends, means and consequences of the
behaviour that leaders themselves exhibit and
induce in followers.
 Distributed and shared leadership - refers to
situations in which the function of leadership is
jointly exercised by a number of highly
interdependent, intensely collaborating and
closely interacting individuals.
Leader/follower relationship leadership
 The leader/follower relationship focuses on the
unique association between a leader and a follower is
called dyad
 For the purpose of this lecture, dyadic refers to “the
individualized relationship between a leader and each
of follower in a work unit.”
(Lussier and Achua, 2007:210)
 The dyadic theory is an approach to leadership that
attempts to explain why leaders vary their behavior
with different followers.
 Some of the theories that explain leader/follower
relations include:
Leader/follower relationship leadership
 Vertical Dyadic Linkage (VDL) Theory
 The vertical dyadic linkage theory describes the
situation whereby a leader forms dyadic in-
group relationships with some followers and
dyadic out-group relationship with other
followers.
 Therefore the theory examines how leaders
form one-on-one relationships with followers,
and how these often create in-groups and out-
groups within the leader’s work unit.
Vertical Dyadic Linkage (VDL) Theory
 For example, a leader may provide closer attention,
guidance, feedback, and consideration to a follower
and the follower in turn provides exceptional
performance and willing to go the extra mile for the
leader.
 The in-group includes followers with strong social
ties to their leader in a supportive relationship
characterised by high mutual trust, respect, loyalty
and influence.
 Members of the in-group are invited to participate in
important decision making, are given added
responsibility, and have greater access to the leader.
Vertical Dyadic Linkage (VDL) Theory
 The out-group includes followers with few or no
ties to their leader, in a strictly task-centered
relationship characterized by low exchange and
top-down influence.
 Members of the out-group are managed according
to the requirements of the employment contract.
 The in-group versus out-group status reveals an
element of reciprocity or exchange in the
relationship.
 Relationships developed in these dyads may
occur at a formal or informal level.
Vertical Dyadic Linkage (VDL) Theory
 For example, a leader may provide closer attention,
guidance, feedback, and consideration to a follower
and the follower in turn provides exceptional
performance and willing to go the extra mile for the
leader.
 The in-group includes followers with strong social
ties to their leader in a supportive relationship
characterised by high mutual trust, respect, loyalty
and influence.
 Members of the in-group are invited to participate in
important decision making, are given added
responsibility, and have greater access to the leader.
Leader/follower relations
 Leader-Member Exchange (LMX) Theory has
the underlying assumption that leaders or
superiors have limited amounts of social,
personal and organizational resources (e.g. time,
attention, energy) and as a result tend to
distribute them among followers selectively.
 Therefore, leader-member exchange is defined as
the quality of the exchange relationship between
an employee and his or her superior.
(Lussier and Achua, 2007:214)
 Leader-Member Exchange (LMX) Theory

 Consequently, high-quality exchange

relationships (in-group) reveal a high degree of
mutual positive effect, loyalty and respect, while
low-quality relationships (out-group) reveals the
opposite.
 This means that this dyadic relationship would be
more predictive of the positive follower and
organisational outcomes than traits or behavior of
superiors.
 The quality of these relationships (LMX) affect
employees perceptions, work ethics, productivity
and satisfaction.
 Leader-Member Exchange (LMX) Theory

 This means that employees who perceive

themselves in a supportive relationship
with their supervisors tend to have higher
performance, satisfaction among others.
 Others have also argued that the quality of
LMX is central to influencing followers’
behavioural experiences, roles and fate in
organisations.
 It further assumes that leaders do not
interact with all followers equally.
 followership

 Many theorists agree that leadership is a

relationship that is jointly produced by leaders
and followers, and therefore important the role of
followers in explaining organizational success.
 Followership refers to the behavior of followers
that results from the leader-follower relationship.
(Lussier and Achua, 2007:225)
 A follower is a person who is being influenced by
a leader.
(Lussier and Achua, 2007:226)
 followership

 The five categories of followers are:

 The alienated follower – is passive yet independent,
critical thinker
 The conformist – is an active but unassertive,
noncritical thinker
 The passive follower – exhibits neither critical,
independent thinking nor active participation.
 The effective follower – is both an independent,
critical thinker and a very active member of the group
 The pragmatic follower – exhibits a little of all four
styles – depending on which style fits the prevailing
situation.
 Key issue 4: Importance of leadership

 Good leadership involves the effective

process delegation and empowerment
because the leader-follower
relationship is reciprocal and effective
leadership is a two-way process which
influences both individual and
organisational performance.
 Leadership is important at all levels
within the organisation
 Importance of leadership
 Leadership is the moral and intellectual ability to
visualise and work for what is best for the
organisation and employees... and therefore the
most vital thing a leader does is to create team
spirit around and near him.
 Good management leadership helps to develop
teamwork and the integration individual and
organisational goal. It aids intrinsic motivation
by emphasising the importance of the work
people do.
 Good leaders are sensitive to the impact of the
change process on people and must be able to
operate under complex, uncertain circumstances.
MANAGEMENT IN
ORGANISATIONS
 Management in organisations
 Organisations can only achieve their goals and
objectives by the coordinated efforts of their
members and it is the task of management to
get the work done through other people.
 Management is essentially an integrating
activity which permeates every facet of the
operations of an organisation. It is therefore the
responsibility of leaders to manage, and to
achieve results through the utilisation of
human resources and the efforts of other
people (Mullin 2006: 55).
THE MEANING OF MANAGEMENT

 There are different approaches to studying

management.
 The meaning of Management can be derived
from the Italian word ‘maneggiare’ meaning
to handle or train horses.
- To ‘manage’ and ‘manager’ therefore suggest
taking care of, leading and arranging etc.
- Management can be is viewed ‘as getting
things done through other people in order to
achieve the stated organisational objectives.
 THE MEANING OF MANAGEMENT
Management is regarded ‘as relating to people
working within a structured organisation and with
prescribed roles’.
Management is conceptualised as ‘a process
designed to coordinate and control productive
activities’.
Management involves ‘coordinating and
overseeing the work activities of others so that
their activities are completed effectively and
efficiently’.
 THE MEANING OF MANAGEMENT

“Management is a process that involves the

major functions of planning, organising, leading
(or deploying) and controlling resources in
order to achieve goals”.
(Martin and Fellenz, 2010: 12)
THE MEANING OF MANAGEMENT cont’d (Figure 6.4)
Mainstream management perspectives

Classical Perspectives
 Scientific management: concerned with
the systematic evaluation of work and the
search for higher productivity
 Administrative: a forerunner of the
systems theory, attempting to identify
ways of managing the whole organisation.
Mainstream management perspectives

Behavioural Perspectives
 Human relations: an approach of
management based upon the importance of
groups and the social context.
 Organisational behaviour: A holistic
approach to managing organisations
incorporating individuals, group and
organisational processes.
 Mainstream management perspectives
Integrating perspectives
 Systems theory: a range of approaches to the
study of organisations and management that
attempt to cast these issues as an interrelated
set of elements which are able to function as a
whole.
 Contingency: An approach which views the
behaviour of any given context as a function
of a wide set of contingent factors acting upon
that situation.
Mainstream management perspectives

 Management is active. It is about changing

behaviour and making things happen. It is
about developing people, working with
them, reaching objectives and achieving
results.
 Management is task. Management is a
discipline. Management is also people.
Every achievement of management is the
achievement of a manager. Every failure is a
failure of a manager.
 Primary functions of management

 Fayol (1916) proposed that management have

five primary function:
 Planning and forecasting: deciding on the
organisational goals and allocate and use
resources to achieve those goals.
 Organising: establish the rules and reporting
relationships that allow people to achieve
organisational goals.
 Commanding: the exercise of authority
ensuring that the right things are done.
Primary functions of management

Coordinating: encourage and coordinate

individuals and groups so that they work
toward organisational goals.
Controlling: evaluate how well the
organisation is achieving its goals and take
action to maintain and improve performance or
take corrective action.
These activities produce degree of
consistency, order and efficiency.
Management roles

Mintzberg (1973) described 10 different roles

that he grouped under three headings:
1. Interpersonal roles – these roles reflect the
form that the interaction with other people
takes as a consequence of the status and type
of managerial job held by a particular
manager – figurehead, leader and liason.
2. Informational roles – those roles that reflect
the nature of the way that information is
used in the job of the manager – monitor,
disseminator and spokesperson.
 Management roles cont’d
3. Decisional roles – those roles reflect the nature
of decision making requirements within a
particular managerial job – entrepreneur,
disturbance handler, resource allocator and
negotiator.
Quinn et al. (2003) also described other
managerial roles to include:
1. Facilitator –
Building teams; Using participative decision
making; Managing.
Management roles cont’d

2. Mentor: Understanding self and others;

Communicating effectively; Developing
employees.
3. Innovator: Living with change; Thinking
creatively; Managing change.
4. Broker: Building and maintaining power
base; Negotiating agreement and
commitment; Presenting ideas.
Management roles cont’d

5. Producer: Working productively;

Fostering a productive work
environment; Managing time and
stress.
6. Director: Developing and
communicating a vision; setting
goals and objectives; designing and
organising.
Management roles cont’d

7. Co-ordinator: Managing projects;

designing work; managing across
function
8. Monitor: Monitoring individual
performance; managing
collective performance and
processes; analysing information
with critical thinking.
KEY ISSUE 6: The role of strategic leadership/ management

 In recent times are organisations operating in

increasingly complex environment, in which
the adaptation to environmental changes is an
imperative.
 Research evidence shows that the effectiveness
of organisations is influenced by the degree of
fit between organisations and their
environment.
 Interpretation of environmental changes play a
large part in the future actions that strategic
leaders employ to remain competitive.
WHAT IS THE MEANING OF strategic leadership
Although many authors have provided varying
definitions of the concept, they all seem to revolve
around the same themes:
‘strategic leadership theory refers to the
study of people at the top of the organisation’.
(Dusya and Crossan, 2004)
‘strategic leadership is defined as a person's ability
to anticipate, envision, maintain flexibility, think
strategically, and work with others to initiate
changes that will create a viable future for the
organisation’ (Ireland and Hitt, 1989)
THE MEANING OF strategic leadership

‘strategic leadership is the ability to

influence others to voluntarily make day-
to-day decisions that enhance the long
term viability of the organisation, while
at the same time maintaining its short-
term financial stability’.
(Rowe, 2001)
The definitions suggest that:
Leaders, managers and employees make
decisions every day as they interact with each
other and stakeholders, especially customers,
suppliers, and the communities in which they
operate (and the question is - are these
decisions in accord with the strategic direction
of the organisation? Will they enhance the
future viability of the organisation as well as
short-term financial stability?)
The definitions suggest that:

 Leaders, managers and employees are

relied upon to voluntarily make decisions
that benefit the organisation and will
have the capacity to examine what the
organization needs to do in both the short
and long terms.
 Leaders have the ability to influence
subordinates, peers, and superiors.
The definitions suggest that:

 The leader understands the emergent

strategy process including the intended
strategic planning process for
organisational performance.
 The decisions voluntarily made and the
actions voluntarily taken by managers and
employees on a day-to-day basis
eventually determine what strategy
emerges.
The definitions suggest that:
 ‘Strategic leadership presumes a shared
vision of what an organization is to be, so
that the day-today decision-making, is
consistent with this vision.
 It presumes agreement among corporate and
divisional senior managers on the
opportunities that can be taken advantage of,
and the threats that can be neutralized, given
the resources and capabilities of the
organisation. (Rowe, 2001)
The definitions suggest that:

 Strategic leaders operate at a boundary

between their organisation and the
external environment. They gather
information from the outside and they
convey information to the outside. They
alert insiders about external news and
developments.
 They ensure that the strategic management
process is successfully carried out.
The definitions suggest that:
Effective strategic leaders are said to perform the
strategic management functions:
1. Conceptualise the organisation’s vision,
mission and core values;
2. Oversee the formulation of objectives, policies
and structures that translate the vision, mission
and core values into business decisions;
3. Create an environment and culture for
organisational learning and mutual exchange
between individuals and groups; and
4. Serve as steward and role for the rest.
WHAT IS THE MEANING OF strategic management

Strategic management is the set of decisions

and actions used to formulate and implement
specific strategies that will achieve a
competitive superior fit between the
organisation and its environment, so as to
achieve organisational goals.
(Lusser and Achua, 2007:393)
 strategic management framework
In order to help achieve this objective, the strategic
management framework could be adopted.
Vision/mission/core values

Analyse internal environment Analyse external environment

Formulate strategy

Implement strategy

Evaluate strategy
strategic planning
 This strategic management framework is
similar to strategic planning.
 strategic planning ‘is that set of managerial
decisions and actions that determines the
long-term performance of an organisation’.
It includes defining the mission, vision and
core values, environmental scanning, (both
internal and external), strategy formulation,
strategy implementation and evaluation and
control”
(Wheelen and Hunger, 1998).
 MISSION, VISION, AND VALUES
Mission
The basic purpose of the organisation as well as its
scope of operations (‘describes what the organisation
is now’)
Vision
A statement about where the company is going and
what it can become in the future; clarifies the long-
term direction of the company and its strategic intent
(‘describes what the organisation would like to
become’)
Core Values
The strong and enduring beliefs and principles that
the company uses as a foundation for its decisions
SCANNING THE EXTERNAL ENVIRONMENT

Environmental Scanning
Is the systematic monitoring of the major
external forces influencing the organisation.
There are a variety of external issues, however,
the some of the most significant issues are as
follows:
Political factors, including political changes.
Economic activity and development
information, including district, metropolitan,
regional, and global conditions, interest rate and
inflation.
SCANNING THE EXTERNAL ENVIRONMENT
cont’d
Technological changes, including information
technology and automation
Government and legislative issues, including laws
and administrative rulings
Composition of workforce including values, age
and working approaches, demographic changes in
the population, national and regional economics,
education level of the workforce, demand for
specific employee skills, population mobility, and
governmental policies.
SCANNING THE EXTERNAL ENVIRONMENT cont’d

Culture and traditional practices, including

collectivism, extended families and funerals.
Social concerns and socio-cultural
practices including customs, time
management issues and educational
priorities.
Industry and competitive trends, including
new processes, services, and innovations
 INDUSTRY/COMPETITIVE ENVIRONMENT

A firm's industry and competitive envi­ronment is

central to strategic planning because it can affect its
strategic decisions. As a result, organisations are
usually most concerned with the intensity of
competition within its industry. The competitive
environment proposed by Porter (1990) includes:

the firm's customers,

rival firms,

new entrants,

substitutes and

suppliers.
Porter’s Five Forces Model
 INTERNAL ANALYSIS
The Three Cs:
 Culture (auditing values, beliefs and
attitudes).
 Capabilities (bundles of people, processes,
and systems that distinguish an organisation
with people as a strategic resource –
 Composition (the human capital
architecture)
Strategy formulation, implementation & evaluation

 Strategy formulation: (the swot analysis- a

comparison of strengths, weaknesses,
opportunities and threats) involves 3 levels.
(1) Corporate strategy; e.g growth and
diversification – focus on geographic, volume
and product expansion
(2) Business strategy; e.g. low cost strategy,
differentiation strategy
 Strategy formulation, implementation & evaluation

 (3) Functional strategy – ‘translate’ strategic

priorities into functional areas (ensuring
clear alignment between HR and the
requirement of an organisation’s strategy)
 Strategy implementation – making sure that
the new plans are implemented.
 Evaluation and assessment – the
establishment of set parameters that focus on
desired outcome.
Linkage Strategic management framework and Human Resources management
Process
 The relationship between strategic leadership, leadership
and management

 Leadership/strategic leadership however, is

concerned more with attention to
communicating with, motivating,
encouraging and involving people.
 This is because leaders/strategic leaders in
complex work organisations must establish
direction, align people with that vision, and
motivate and inspire them to make it happen
despite the barriers.
 Some quotes

Best quotes from the late Nelson Mandela’s leadership

“A good head and a good heart are always a
formidable combination.”
“After climbing a great hill, one only finds that there
are many more hills to climb.”
“If you talk to a man in a language he understands, that
goes to his head. If you talk to him in his language, that
goes to his heart.”
“It is better to lead from behind and to put others in
front, especially when you celebrate victory, when nice
things occur. You take the front line when there is
danger. Then people will appreciate your leadership.”
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 REFERENCES AND FURTHER READING
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