Strategic Management and Leadership

Topic 1
Learning outcomes
LO-1. Understand the relationship between strategic management and
leadership

Assessment Criteria
1.1. Leaner’s need to explain the link between strategic management and
leadership
 Introduction
• Strategic management provides better guidelines to the entire
organisation on the crucial point of “what is it we are trying to do and to
achieve”?

• It makes managers more alert to the winds of change, new opportunities

and threatening developments.

• Thus, among the entire things managers do, few affect a company’s
performance more. This is where strategic management becomes a
disposable factor.
 What is Strategy?

• Steiner and Miner (1977), define strategy to mean the formulation of basic
organisation missions, purposes and objectives, polices and program
strategies to achieve them, and the methods needed to ensure that
strategies are implemented.

• Quinn and Mintzberg (1991) state that there is no single universally

accepted definition of strategy and there is no one best way to create
strategy, nor is there any one best form of organisation.
 Levels of Strategy

• Corporate strategy... defines the scope of the business in terms of the

industries and markets in which it competes.
– includes decisions about diversification, vertical integration,
acquisitions, new ventures, divestments,

• Business strategy... is concerned with how the firm competes within a

particular industry or market... to win a business unit must adopt a
strategy that establishes a competitive advantage over its rivals.

• Functional strategy... the detailed deployment of resources at the

operational level
 Strategic Management Techniques

• Strategic management techniques can be viewed in two major ways.

• The first is the bottom-up or collaborative processes.

– The employees initiate a proposal which they subsequently submit to
their managers or superiors, who put the idea further up in the
establishment.

• The second is the top-down approach

– It is more common. The chief executive officer and his team decide on
the overall direction which the organisation should go.
The Role of Leadership in Implementing Change

Implementing Change

• Organizational change is an alteration in an organization’s alignment with

its external environment

• Organizations spend millions of dollars on change efforts

• Change can be transformational or incremental

• Organizational change is any transition that requires a change in human

performance
 The Need for Change

• Rapid environmental changes are causing fundamental transformations

that are having a dramatic impact on organizations and presenting new
opportunities and threats for leadership
 The Need for Change (Cont.)

• Every type of organization is facing an external environment

characterized by:
– New technology
– Global economy
– Changing market requirements
– Intense domestic and international competition
• The need for change is more likely when a long-time CEO retires a new
CEO is brought in
The Role of Leadership in Implementing Change

• Resistance to change and the absence of effective leadership are major

reasons for why most transformation efforts fail

• Effective change agents must:

– Make every effort to eliminate policies, procedures, and behaviors
that undermine the change efforts
– Be willing to alter his or her own behavior if it will minimize
resistance
– Be good listeners
 Role of Leadership in Strategic Management

• A strategy manager has different leadership roles to play such as chief

entrepreneur, chief administrator, crises solver, taskmaster, adviser, policy
maker, consensus builder and role model.

• Sometimes, a leader should be authoritarian and at other times be a

perceptive listener and a compromising decision maker.

• In some occasions, the leader plays a highly visible role with extensive
time commitment.

• At other times, there should just be a brief ceremonial performance with

most details delegated to subordinates.
 Who is a leader?

• Leaders are persons others want to follow.

• Leaders are the ones who command the trust and loyalty of followers.
 Strategic Leadership

• Strategic Leadership Requires the managerial ability to:

– Anticipate and envision

– Maintain flexibility
– Empower others to create strategic change as necessary

• Strategic leadership is:

– Multi-functional work that involves working through others

– Consideration of the entire enterprise rather than just a sub-unit
 Strategic Leadership (Cont.)

• Effective strategic leaders:

– Manage the firm operations effectively

– Sustain a high performance over time

– Make better decisions than their competitors

– Understand how their decisions affect the internal systems in use by

the firm

– feedback from peers, superiors and employees about their decisions

and visions
 Strategic Leadership (Cont.)
• Effective strategic leaders are skilled at:

– Building a highly effective, efficient, and motivated team of

employees

– Selecting, developing, and mentoring a talented team of leaders

– Deciding on appropriate goals and priorities for achieving them

– Being an effective communicator

 Role of Managers

• In order to stay on top of how well strategy implementation is going, a

manager must develop a broad network of controls and sources of
information both formal and informal.
• The regular channels could in
– talking with key subordinates,
– reading written reports,
– getting feedbacks from customers,
– watching competitive rival firms’ reactions,
– listening to the first hand observations.
 Manager Roles

1. Informational Role

 Monitor : Seek and receive information, scan periodicals and reports,

maintain personal contacts.

 Disseminator: Forward information to other organization members

 Spokesperson : Transmit information to outsiders through speeches,

reports,.
 Manager Roles
2. Interpersonal Role

 Figurehead: Perform ceremonial and symbolic duties such as greeting

visitors, signing legal documents.

 Leader: Direct and motivate subordinates; train, counsel, and

communicate with subordinates.

 Liaison: Maintain information links both inside and outside organization.

 Manager Roles
3. Decisional Role

 Entrepreneur: Initiate improvement projects; identify new ideas, delegate

idea to others.

 Disturbance handler: Take corrective action; resolve conflicts among

subordinates;

 Resource allocator: Decide who gets resources; schedule, budget, set

priorities.

 Negotiator: Represent department during negotiation of union contacts,

sales, purchases, budgets.
 Discussion Question

Comment on this statement: “Google is so successful it

does not need to change anything in its strategic
framework.”
 Followership
• Effective leadership requires good followers.

• A leader can’t lead without followers.

• A good leader knows how to identify and get the best out of followers.

• Followers are considered less important, as intelligent or successful as the

person in the leadership position.

• Those who ends up as leaders initially serve in followership.

 Followership

• Therefore, followers are just as fundamental to leadership equation as

leaders, they just serve a different purpose.

• Without effective followership, a leader can fail to achieve the

organizational goals.
 Definition of Followership

• Followers are the people who act with intelligence, independence,

courage, and a strong sense of ethics. (Kelley 1992)

• Followership defines as reaching a specific goal while exercising respect

for authority, a positive attitude, integrity, and self-discipline.
 Reason to follow

• Fear of retribution
• Blind hope
• Faith in leader
• Intellectual agreement
• Buying the vision
 Essential qualities of good followers
• Maintain a positive attitude

• Work effectively as a team member.

• Exhibit loyalty to leader and organization.

• Volunteer to handle tasks

• Willingly accept assignments

• Offer suggestions

• Respectfully voice differences of opinions

• Support group decisions

 Types of followers

• Alienated followers –are independent and critical thinker.

• Conformist followers – are the “yes people” of the organizations but lack
independent

• Passive followers – rely on leaders and they require constant direction.

• Exemplary followers - are independent, innovative, and willing to

question leadership. This type of follower is critical to organizational
success.
Link between Strategic Management and Leadership
 Key Strategic Leadership Actions: Determining
Strategic Direction

• Determining a long-term vision of the firm

– Five to ten years into the future

 Key Strategic Leadership Actions:
Managing the Firm’s Resource Portfolio
• Core competencies
– Resources and capabilities of a firm that serve as a source of
competitive advantage over its rivals.
– Leadership must verify that the firm’s competencies are emphasized in
strategy implementation efforts.
– Firms must continuously develop or change their core competencies
to stay ahead of competitors.
 Key Strategic Leadership Actions:
Sustaining an Effective Organizational Culture

• Organizational Culture
– The complex set of ideologies, symbols and core values shared
through the firm, that influences the way business is conducted.

• Changing a firm’s organizational culture is more difficult than maintaining

it.
– Effective strategic leaders recognize when change in culture is needed.
 Key Strategic Leadership Actions: Emphasizing
Ethical Practices

• Effectiveness of processes used to implement the firm’s strategies

increases when based on ethical practices.
• Ethical practices create social capital and goodwill for the firm.
 Key Strategic Leadership Actions:
Establishing Organizational Controls
• Controls
– Formal, information-based procedures used by managers to maintain
or alter patterns in organizational activities.
• Controls help strategic leaders to:
– Demonstrate the value of strategies to the firm’s stakeholders
– Promote and support strategic change
Developing Strategic Management and
Leadership Skills

Topic-2
Learning Outcomes
LO-1. Understand the relationship between strategic management and
Leadership

Assessment criteria
1.2. Analyze the impact of management and leadership styles on
strategic decisions
1.3. Evaluate how leadership styles can be adapted to different
situations
 Management and Leadership Style

• A wide variety of leadership styles focus on the relationship between the

leader and the follower.

• Leadership style is
– the way in which the functions of leadership are carried out,
– the way in which the manager typically behaves towards members of
the group

• Leadership style is based on the assumption that

– subordinates are more likely to work effectively for managers who
adopt a certain style of leadership.
• The four leadership styles consist of Telling, Selling, Participating, and
Delegating. [Hersey and Blanchard (Hersey, 1984):]
• Telling should be used in situations in which followers lack the training,
confidence, or desire to complete a task. The theory recommends that
task-oriented leader behaviors should predominate in this case. Leaders
need to direct followers down the right path by giving them detailed
directions and monitoring their performance.
• Selling is the style to use with followers who are confident and willing, but
who are not able to complete the task. High levels of both task- and
relationship-oriented behaviors are recommended in this situation.
Leaders can guide follower behavior by clarifying decisions and giving
followers the chance to ask questions.
 Four Leadership Styles

• Participating should be used to boost the motivation of followers who

have the capabilities to achieve goals, but who lack confidence in
themselves. Relationship-oriented leadership predominates in this case.
Leaders encourage followers to participate in decisions and support their
efforts.

• Delegating is the style to use when followers are able, confident, and
motivated. Only low levels of relationship- and task-oriented behaviors are
called for in this case as the follower is so self-directed. The leader can
turn over responsibility to the follower in terms of what to do and how to
do it.
Four Leadership Style
Integrated model of followership and leadership
styles
Behaviors recommended
 The importance of collaboration

• It is important that the leader and followers work together to achieve

organizational goals.

• The success of any organization depends heavily on the followers more so

than its leaders when considering that 80% of the work that is
accomplished is completed by the followers.
 Different Leadership Styles

1. The authoritarian or autocratic style

– It is where the focus of power is with the manager and all interactions
within the group move towards the manager.

– The manager alone exercises decision-making and authority for

determining policy, procedures for achieving goals, work tasks and
relationships, control of rewards or punishments
• One of the primary advantages of an autocratic approach to leadership is
decisions generally get made much more quickly.

• An ability to make quick decisions is more likely to a problem will be

overlooked because the leader is unlikely to have as much information as
the entire group.

 An autocratic leadership style works best in situations where rapid

decisions are often essential, such as in the military or law enforcement.
2. The democratic style

• It is where the focus of power is more with the group as a whole and
there is greater interaction within the group.

• The leadership functions are shared with members of the group and
the manager is more part of a team.

• The group members have a greater say in decision-making,

determination of policy, implementation of systems and procedures.
 Democratic leadership styles tend to result in a happier work environment
they will feel more a part of the company.

 In a democratic process, consultations and reviews often slow down the

momentum required to make rapid choices and arrive at a solution.

 Democratic is usually appreciated by the people, especially if they have

been used to autocratic decisions with which they disagreed.

 It can be problematic when there are a wide range of opinions and there
is no clear way of reaching an equitable final decision.
3. A laissez-faire style

– It is where the manager observes that members of the group are

working well on their own. The manager consciously makes a decision
to pass the focus of power to members, to allow them freedom of
action to do as they think best, and not to interfere, but is readily
available if help is needed.

– The laissez-faire style is to minimize the leader's involvement in

decision-making, and hence allowing people to make their own
decisions, although they may still be responsible for the outcome.

– Laissez-faire works best when people are capable and motivated in

making their own decisions.
4. Participative leadership style

 In which the leader participates with and involves others in the decision-
making process.

 The participative leader is a person who realizes the importance of getting

opinions from others.

 A little-known example of a participative leader is Brian Ashton, the coach

of the English World Cup rugby team. According to the UK Times Online,
Ashton used a participative leadership style with his team in the rugby
World Cup. This leadership style allowed the players to come up with a
game plan, with the assistance from Ashton, that allowed them to have a
successful World Cup.
• Direct Leadership style

– It involves letting subordinates know exactly what is expected of them

and giving specific directions. Subordinates are expected to follow
rules and regulations. (Mullins, 2005).

– It has been described as autocratic, task-oriented, and persuasive and

manipulative (Bass 1981).

– Though it can be effective in communicating a clear and concise vision

of the organization’s strategic goals, directive leadership is
transformational only by coercion.

– Because of the authoritative nature of directive leadership employees

may be less likely to adopt management’s vision or values if they are
excluded from the decision-making process.
 Influences on Leadership Style

• Leadership style has been influenced by such factors as:

– Increasing business competitiveness and recognition of efficient use of

HR
– Changes in the value system of society
– Broader standards of education and training
– Advances in scientific and technical knowledge
– Changes in the nature of work organizations
 Influences on Leadership Style (Cont.)

– Pressure for a greater social responsibility towards employees, for

example through schemes of participation in decision-making and
work/life balance and

– Government legislation, for example in the area of employment

protection, and the influence of the EU.

• All of these factors have combined to create resistance against purely

autocratic styles of leadership
 Impact of Leadership Styles on Strategic Decisions

• Essentially, leadership has influence over organizations via strategic decision-

making, determining organizational structure and managing the organizational
process.

• Effective leadership in an organization is evident in direct action, decisions and

behaviors .

• A leader oversees and regulates the overall functioning of an organization.

• In order for their organizations to perform well, leaders should have an

innovative vision that will move the organization in the right perspective and
direction (Dessler, 1994).

• Therefore, an ideal leader should have strong perceptional resources such as

intelligence and knowledge.
• These are problems of the economic structure such as the problem of
weak competitiveness and inefficiency.

• In fact, some established firms with good managerial practices were able
to survive and to sustain growth.

• On the other hand, firms having inappropriate strategic decision-making

and faulty practices such as selecting unsuitable strategy, poor leadership
style and misinterpreting environments were destined to collapse.
• A strategy is a plan for interacting with the competitive environment to
achieve organizational goals .

• A business strategy focuses on improving the competitive position of a

firm’s products or services within the specific industry or market segment
in which the firm exists.

• Miles and Snow (1978) described strategic types, emphasizing an

organization’s orientation toward product-market development.

• They suggested four strategic types: defenders, prospectors, analyzers and

reactors.

• The first three types of typology had similar degrees of success, while the
last was a strategic failure.
 Impact of Leadership Styles on Strategic Decisions

• 1. Prospector Strategy refers to the firms that have very broad product-
market domains, a focus on innovation and change, and a flexible
administrative structure.

• They tend to have complex coordination and communication

mechanisms, rely on participative and decentralized decision- making.

• They monitor a wide range of environmental condition. Technological

flexibility is a crucial aspect of this strategy .

• These firms are frequently first-to market with new products or service
concepts.
2. Defender strategy refers to the firms, which have narrow product market
domains, a focus on production efficiency, and a stable administrative
structure.

• They devote a lot of attention to controlling operating cost since

efficiency is an important prerequisite for their success.

• Their technology choices favour inflexible but cost-efficient methods,

often involving substantial levels of vertical integration to control costs.

• They rely on centralized decision-making.

3. Analyzer strategy is hybrid strategy that firms exhibit some features of the
prospector and defender strategies .

• They have multiple products; in some product markets they resemble

prospectors, while in others they more closely resemble defenders.

• They adopt dual core technologies that have both stable and flexible
components.

• They are usually administered through matrix structures, which include

the benefits of centralized control and functional specialization which
providing the flexibility normally associate with product-oriented
structures .

• This organization uses analyzer strategy and the CEO has a democratic
leadership style, participative style and autocratic style.
4. Reactor strategy refers to the firms have no consistent strategy or pattern
in responding to pressures of the marketplace or environment.

• These firms focus the activities or business functions, which most need
attention given the opportunities or problems that they currently
confront.

• They identify the best possible solutions to those problems or challenges

even through they may possess only moderate potential, which require
immediate attention.

• The organization uses defender strategy and the CEO has an autocratic
leadership style
 Leadership Style in Different Situations

• A potential danger with the contingency approach is that the manager

may appear to lack consistency in leadership style.

• Subordinates would expect a different style of managerial leadership

according to the contingencies of the situation.

• This is not to say that different types of problems should be approached in

the same manner.

• Therefore, different leadership styles are needed to cope with different

situations.
 Leadership Style in Different Situations (Cont.)

• For example-

• Autocratic style makes sense when an organization is in deep trouble and

needs to achieve a rapid turn-around.

• That style would be counter-productive when the organization is in a

growth situation.

• Different types of leadership styles may also be most appropriate at

different stages in he development of a business organizations.

• Leadership can also vary between public and private sectors and depend
upon the size of the organization.
 Leadership Style in Different Situations (Cont.)

• For example-

• Recognize and develop appropriate leadership for the different stages of

the innovation process.

• Transformational leadership skills may be more useful in early-stage

innovation activity such as R &D and product development, but
transactional leadership skills are also essential to the smooth functioning
of commercialization.
• Another major variable influencing choice of leadership style may be
national culture.
• It is clear that people living in different parts of the world have different
expectations from those in a leadership position.
• For example
– European managers tend to be more people-oriented than American
or Japanese managers.
– Japanese culture is very collective oriented, while American focuses
more on profitability.
– Time horizons also are affected by cultures.
• U.S. firms often focus on short-run efforts.
• Japanese firms take a longer-term outlook.
• McGregor concluded that the social, economic and political environment
affected the leadership relationship, together with the attitudes and
needs of followers.

• The way in which employees perceive their leaders, as employee-oriented

or task oriented, appears to vary from culture to culture.
Developing Strategic Management
and Leadership Skills

Topic 3
Learning outcomes

LO-2. Be able to apply management and leadership theory to support

organizational direction

Assessment Criteria
2.1. Learner need to review the impact that selected theories of management
and leadership have on organizational strategy
2.2. Learner need to create a leadership strategy that supports organizational
direction
 Introduction

• Every organisation is setup with some objectives in mind. Whatever the

objective it reflects in the policies of an organisation.

• Leadership sets the direction for an organisation and management

ensures to implement policies that lead organisations to achieve set goals.

• Keeping in mind aims of organisation different management theories can

be adapted to support core objectives that set the style of management in
an organization.
 Trait Theories

• Traits Theories of Leadership

Leadership Traits:
• Theories that consider
personality, social, physical, or • Ambition and energy
intellectual traits to
differentiate leaders from • The desire to lead
nonleaders. • Honest and integrity
• Self-confidence
• Intelligence
• High self-monitoring
• Job-relevant knowledge
 Trait Theories

Limitations:
• No universal traits found that predict leadership in all situations.
• Traits predict behavior better in “weak” than “strong” situations.
• Unclear evidence of the cause and effect of relationship of leadership and
traits.
• Better predictor of the appearance of leadership than distinguishing
effective and ineffective leaders.
 Behavioral Theories

• Behavioral Theories of Leadership

• Theories proposing that specific behaviors differentiate leaders from
nonleaders.

• Trait theory:
Leaders are born, not made.
• Behavioral theory:
Leadership traits can be taught.
 Ohio State Studies
Initiating Structure
• The extent to which a leader is likely to define and structure his or her role
and those of sub-ordinates in the search for goal attainment.
Consideration
• The extent to which a leader is likely to have job relationships
characterized by mutual trust, respect for subordinate’s ideas, and regard
for their feelings.
 University of Michigan Studies

Employee-Oriented Leader
• Emphasizing interpersonal relations; taking a personal interest in the
needs of employees and accepting individual differences among members.

Production-Oriented Leader
• One who emphasizes technical or task aspects of the job.
 Transactional vs. Transformational Leaders

Transactional Leadership

• Emphasizes getting things done within the umbrella of the status quo

• In opposition to transformational leadership

• “By the book" approach - the person works within the rules

• Commonly seen in large, bureaucratic

 Transformational Leaders
• Creates and sustains a context that maximizes human and organizational
capabilities;
• Facilitate multiple levels of transformation; and
• Align them with core values and a unified purpose to respond to a dynamic
environment
• Make change happen in:
• Self,
• Others,
• Groups, and
• Organizations
• Charisma a special leadership style commonly associated with
transformational leadership; extremely powerful, extremely hard to teach.
Elements of Transformational Leadership
 Transformational Leaders…
 Do not accept the status quo

 Create a graphic and compelling vision of the future

 Act as role models

 Are often referred to as “tough”

 Energise and inspire others

 Are said to be “charismatic”

 Are very instrumental in times of turbulence / crises

 Provide sense of individual consideration

 Provide stimulation (intellectual and emotional)

(James MacGregor Burns, 1978)
 Transformational Leadership

• How Transformational Leadership Works: Transformational leaders are

more effective because they are more creative but also they encourage
those who follow them to be creative, too.

• Evaluation of Transformational Leadership: Impressively supported at

various job levels and in disparate occupations.
 Charismatic Leadership

• Charismatic leadership
– Charisma is a strong form of referent power
– Influence is based on individual inspirational qualities rather than
formal power
– Followers or subordinates identify with charismatic leaders because of
these exceptional qualities
 Charismatic Leadership
Attributes of Charismatic Leaders
• Need for power
• Impression management
• Self-sacrifice toward organization
• Innovative or unorthodox actions
• Ideals, values, lofty goals
• High expectations for followers
• Models desired behaviors
• Inspires followers
• Strong belief in own ideas
• High level of self-confidence
 Charismatic Leadership

• Are Charismatic leaders Born or Made? Yes and Yes- Individuals are born
with traits that make them charismatic.

• How Charismatic Leaders influence Followers?”

- Articulating an appealing vision
- Vision statement
- Set an example for followers to imitate
- Engages in emotion-inducting and non- convention behavior to
demonstrate courage and conviction about the vision.

• Many charismatic leaders use their power to remake companies in their

own image and allowed their own interest and personal goals to override
the goals of the organization.
 Contingency Theories
Fiedler’s Contingency Model
• The theory that effective groups depend on a proper match between a
leader’s style of interacting with subordinates and the degree to which the
situation gives control and influence to the leader.
Least Preferred Co-Worker (LPC) Questionnaire
• An instrument that purports to measure whether a person is task- or
relationship-oriented.
Contingency Approaches
 Contingency Theory (Fiedler 1978)

• Leadership effectiveness is determined by the interaction between the

leader's personal characteristics and the characteristics of the situation
• Leaders are classified as person-oriented or task-oriented (which type will
be more effective depends on the leader's degree of situational control)
• Control depends on relationship between leader/followers, the degree of
task structure, and the leader's authority (position power)
 Fiedler’s Model: Defining the Situation
Leader-Member Relations
• The degree of confidence, trust, and respect subordinates have in their
leader.

Task Structure
• The degree to which the job assignments are procedurized.

Position Power
• Influence derived from one’s formal structural position in the organization;
includes power to hire, fire, discipline, promote, and give salary increases.
 Contingency Theory (Fiedler 1978)

• The task-oriented leader will be effective in extremely favorable or

extremely unfavorable situations

• The person-oriented leader will be more effective in moderately favorable

situations

• Criticisms include most of research was in the lab

 The LPC Scale
• Least Preferred Coworker Scale, or LPC scale.

• “Think of the person whom you least like to work with”

•LPC score measures attitudes of the leader

• it is rating given by leaders about the person with whom they could work least well.
 LPC Scale
• He or she may be someone you work with now or someone you knew in
the past. This coworker does not have to be the person you like least but
should be the person with whom you had the most difficulty in getting a
job done.

• High LPC score – Interpersonal relationship orientation

• Low LPC score – task- oriented leader

LPC Scale
 Situational Theory - Hersey and Blanchard
(1978)
• Hersey and Blanchard’s extension of the Leadership Grid focusing on the
characteristics of followers as the important element of the situation, and
consequently, of determining effective leader behavior.
• Hersey and Blanchard suggest that groups benefit from leadership that
meshes with the developmental stage of the group.
• Situational leadership based on the readiness level of people.
• Readiness means followers have the ability and willingness to accomplish
a specific task and how ready the individual is to perform a particular task.
Hersey and Blanchard’s Situational Theory of
Leadership
 Hersey and Blanchard’s Situational Leadership
Theory
• Situational Leadership Theory (SLT)
• A contingency theory that focuses on followers’ readiness.
Leadership Styles and Follower Readiness
(Hersey and Blanchard)
 Leader-Participation Model

• Leader-Participation Model (Vroom and Yetton)

• A leadership theory that provides a set of rules to determine the form and
amount of participative decision making in different situations.
 Contingency Theories (Cont’d)

• Leader Participation Model (Vroom and Yetton)

– Posits that leader behavior must be adjusted to reflect the task

structure—whether it is routine, non-routine, or in between—based
on a sequential set of rules (contingencies) for determining the form
and amount of follower participation in decision making in a given
situation.
– Base their analysis on two main aspects of a leader’s decision.
– Decision quality or rationality is the effect that the decision has on
group performance.
– Decision acceptance refers to the motivation and commitment of
group members in implementing the decision.
– A third consideration is the amount of time required to make the
decision.
 Contingency Theories (Cont’d)

• The Vroom and Yetton model suggests five main management decision
styles:
• Autocratic
• AI: Leader solves the problem or makes the decision alone using
information available at the time.
• A II: Leader obtains information from subordinates but then decides on
solution alone
• Consultative
• C I: The problem is shared with relevant subordinates. The leader then
makes the decision.
• C II: The problem is shared with subordinates as a group. The leader then
makes the decision to reach on a solution.
 Contingency Theories (Cont’d)

• Group
• G II: the problem is shared with subordinates as a group. The leader acts
as chairperson. Together the leader and subordinates to reach on a
solution.
 Tri-dimensional Leadership Theory

• Yukl’s tri-dimensional theory suggests that there is no set course of action

which will be successful in all the circumstances. It is management and
leadership who decide what action to take at a particular time. It heavily
relies on effectiveness and efficiency, human resource relations and
innovation & adaptation.
• If management’s focus is effectiveness and efficiency, its strategy will be
task-oriented. To improved efficiency first step is that everyone should
know his roles and responsibilities, what is expected of him / her. This
clear cut job assignment will help an employee concentrate on his job and
facilitate managers to evaluate employee’s performance. This will improve
sense of responsibility and employees will be more focused on their job
roles which will improve their effectiveness and efficiency.
 Tri-dimensional Leadership Theory

• In case of human resource relations, strategy will be relations-oriented.

Management will try to build good relations with employees in order to
come closer with them, understand their views and negotiate with them.
This helps management obtain 1st hand knowledge of employees
problems and come up with solutions that will win the hearts of
employees.

• This involvement of employees and their participation in decision making

will help them do their tasks with more motivation and achieve
organisational goals and objectives.
 Tri-dimensional Leadership Theory

• Innovative and adaptation style is required when an organization is in

need of change. Management will sort out new ways of doing things.

• Change is the only constant thing in nature, internal & external factors
both influence an organisation to change its strategies to survive and
thrive in business. This needs strong thinking and analysis followed by
careful decision making.

• This theory suggests that leaders should be able to analyse the situations
and they should be flexible enough to meld their strategies accordingly
Developing Strategic Management and
Leadership Skills

Topic-4
Learning Outcomes
LO-2. Understand the relationship between strategic management and
Leadership

Assessment criteria
2.1. Review the impact that selected theories of management and leadership
have on organizational strategy
 Emotional Intelligence

What is Emotional Intelligence?

“The capacity for recognising our own feelings and those of others, for
motivating ourselves, for managing emotions well in ourselves and in our
relationships.”
(Goleman, 1995)
 What is Emotional Intelligence?

 The ability to perceive emotions

 The ability to access and generate emotions so as it assist thought
 The ability to understand complex emotions and emotional knowledge
 The ability to reflectively regulate emotions so as to promote emotional
and intellectual growth
Four Basic Components of EI
 So Why is EI Important?
High EI individuals compared to those low on EI are:

 Less aggressive

 More empathic

 Happier

 Less depressed

 Less stressed

 Higher self-esteem

 Less lonely

 Better quality friendships relationships

 EI influences on Leadership Effectiveness

• EI contributes to people’s capacity to work effectively in teams, manage

stress, and/or lead others (Ashkanasy & Trevor-Roberts, 2000; Mayer,
Salovey, & Caruso, 2004; George, 2000; Goleman, 1998; Goleman,
Boyatzis, & Mckee, 2002; Prati, Douglas, Ferris, Ammeter, & Buckley,
2003).

• For example, leaders who are poor at managing emotions may allow their
emotions to interfere with effective action.

• For instance, when they feel anxious, they may avoid giving an important
speech, or when they feel angry, they may inappropriately lash out at a co-
worker.
 Studies on Emotional Quotient (EQ)

• Goleman developed the following model of competencies:

• Personal competence: these competencies determine how we manage

ourselves.

– Self-awareness: knowing one’s internal states, preferences, resources

and intuitions.
– Emotional self-awareness: recognising one’s emotions and their
effects.
– Accurate self-assessment: knowing one’s strengths and limits.
– Self-confidence: a strong sense of one’s self-worth and capabilities.
– Self-management: managing one’s internal states, impulses and
resources.
Studies on Emotional Quotient (EQ) (Cont.)

– Self-control: keeping disruptive emotions and impulses in check.

– Trustworthiness: maintaining standards of honesty and integrity.

– Conscientiousness: taking responsibility for personal performance.

– Adaptability: flexibility in handling change.

– Achievement-orientation: striving to improve or meeting a standard

of excellence.

– Initiative: readiness to act on opportunities.

 Studies on EI (Cont.)

• Social competence: these competencies determine how we handle

relationships.

– Social awareness: awareness of others’ feelings, needs and concerns.

– Empathy: sensing others’ feelings and perspectives, and taking an
active interest in their concerns.
– Organizational awareness: reading a group’s emotional currents and
power relationships.
– Service orientation: anticipating, recognizing and meeting customers’
needs.
– Social skills: adaptness at inducing desirable responses in others.
– Developing others: sensing others’ developmental needs and
bolstering their abilities.
 Studies on EI (Cont.)
– Leadership: inspiring and guiding individuals and groups

– Influence: wielding effective tactics for persuasion.

– Communication: listening openly and sending convincing messages.

– Change catalyst: initiating or managing change.

– Conflict management: negotiating and resolving disagreements.

– Building bonds: nurturing instrumental relationships.

– Teamwork and collaboration: working with others toward shared

goals. Creating group synergy in pursuing collective goals.
 Studies on EI (Cont.)

• Higgs and Dulewicz

These two British authors from Henley Management College identified seven
elements of emotional intelligence in their book Making sense of emotional
intelligence. These elements are broken down into the following three areas:
• Drivers: motivation and decisiveness, traits that energies people and drive
them towards achieving goals.

• Constrainers: conscientiousness, integrity and emotional resilience, factors

that control and curb the excesses of the drivers.

• Enablers: sensitivity, influence and self-awareness, traits that facilitate

performance and help individuals to succeed.
Developing Strategic Management and
Leadership Skills

Topic-5
Learning Outcomes
LO-2. Understand the relationship between strategic management and
Leadership

Assessment criteria
2.1. Review the impact that selected theories of management and leadership
have on organizational strategy
2.2. Create a leadership strategy that supports organizational direction
 Applicability to Support Organizational
Direction
Leadership and Efficiency

• To increase workplace efficiency by controlling elementary problems in

workplace, workplace learning opportunity finds efficient ways to get jobs
done.

• Visionary Leadership increases efficiency by moving decision-making

responsibility to the frontline. Efficiency is achieved with limited
supervision. To make frontline responsibility effective, leadership must
give workers opportunity to develop decision-making skills and learn to
trust them.

• Wal-Mart stores use visionary leadership.

 Leadership and Reliability

• The leadership trait is reliability. When it is needed to think of reliable

people, people who are dependable and have a high degree of integrity.

• This includes communicating clearly what they will do and when, then
meeting that commitment.

• And, because reliability involves building trust, everything they say and do
will impact other people’s perception of how reliable they are.

• They build or tear down trust with everything that they do and every
commitment that they keep or break. To be reliable, other people must
be willing to count on them.
 Leadership and Innovation

• Leaders also affect innovation through organizational design and must

create appropriate organizational environments to suit the different
innovation processes.

• The primary challenges for organizational leaders in promoting innovation

are to:

• Recognize and develop appropriate leadership for the different stages of

the innovation process and

• Create organizational contexts that support complete innovation

processes of different degrees of novelty.
 Leadership, Adaption and Human Resources in
Sectors
• The natural environment of most organizations is evolving dynamic and
competitive. To battle such dynamic and turbulent times, associations
require persons who are oriented in the direction of discovering, and
development.

• In the global competitive market of today, Human Resources are playing a

vital role in almost all aspects of life and in organizational development.

• As more and more organizations are making progress, by making the use
of human resources, they need some means to increase the performance
in human resource by increasing the efficiency of leaders and their
followers.
• Leadership behaviors that is considered is related to the directive and
inspirational side of leadership.

• To accomplish their organizational endeavors, leaders communicate and

implement their vision, effectively, control task processes and reward
people.

• When successful in displaying these behaviors at work, individuals are

described as achieving results, providing leadership, communicating a
vision and motivating and influencing others.
 Leadership, Organizations and Sub-units

• The new environment is typified by an increased level of complexity and

interconnectedness. Managers were facing the difficulty when leading
teams spread across

• the globe. Because the global economy has become interconnected,

managers felt they could no longer afford to focus solely on events in their
local economies; instead they were constantly forced to adjust their
strategies and tactics to events that were happening in different parts of
the world.

• This challenge was compounded by the fact that these managers were
leading team members of different nationalities, with different cultural
values, who all operated in vastly different time zones – all of this before
addressing the complexity of the task itself.
• Whatever style is best suited for the CEO of an organization, a variety of
leadership styles may be required to lead different groups such as
manufacturing operations, marketing, finance, and creative services
within a company.

• One of the main reasons for the high failure rate of new CEOs is poor
organizational fit. Ability can take leaders only so far if they are not
compatible with the company culture.

• EI affects teamwork and interpersonal relationships at work.

Understanding and regulating one’s emotion as well as those of others
enable one to work cooperatively and share positive feelings with work
colleagues, thus promoting a bond between individuals at work.
 Leadership, Size and Stage of Development of
Organization
• Leadership Performance has a high impact on leadership followers which
leads to the Organizational Development.

• Supporting leaders and their teams can really help businesses achieve
their ambitions.
Leadership and Business Start-up versus Established
Business
• Whether it is developing a high growth start-up or steering an established
business, there comes a point when every leader needs to grow their
knowledge and expertise.

• Grow businesses
• High-performing companies spend on average 36% more on management and
leadership development than low performing organizations.

• Make the most of teams

• The way leader lead teams defines how they will respond during periods of
growth and expansion.

• Take business to the next level

• Organization needs to provide leadership support at any stage; even to
employee-owned companies or those with different business models.
 Turnaround Leadership

• Turnaround leadership is essential during the periods of greatest risk .

• The turnaround leader is the hope, the magic potion, the superman.
Because the expectations are so great, the criteria for success are
especially demanding.

• Different companies need different kinds of leaders. The CEO that

managed the company while it got into trouble probably doesn’t have the
skills to manage long-term, day-to-day operations.

• Leadership requirements differ between those for healthy, growing

companies and for those in a troubled situation. Compare the differences
in the following Table.
Turnaround Leadership (Cont.)
 Leadership and Cultural Issues

• Today's businesses are complex entities. As workforces become

increasingly multicultural and businesses continue to expand overseas, the
homogenous workforce has become a thing of the past.
• The cultural diversity of businesses necessitates that internal
communication now takes note of the intercultural element if it is to be
truly effective.
• Management today have to ensure that they are understanding and being
understood across cultural boundaries.
 Leadership and Cultural Issues (Cont.)

• Leadership style is another area where cultural intelligence is necessary to

lead across different cultures.
• Just as individuals possess varying views and beliefs about preferred
styles of leadership, cultures as a whole have varying preferences for
certain leadership approaches.
• A participative leadership style, where the hierarchical pyramid is flat,
where managers involve others in decision making was viewed as an
essential way of working among most Dutch leaders and organizations.
• However, this same style was viewed as a weakness among many firms
and leaders from Romania, where authoritative leadership was perceived
as a strength.
• It’s impossible to master all the norms and values of each culture, but
effective leadership does require some adaptation in approach and
strategy.
• The most pressing issues executives identify are to understand diverse
customers, manage diverse teams, recruit and develop cross-cultural
talent, adapt leadership style and demonstrate respect/empathy to the
local culture.
Developing Strategic Management and
Leadership Skills

Topic-6
Learning outcomes
LO-3. Be able to assess leadership requirements

Assessment Criteria
3.1. Leaner need to use appropriate methods to review current leadership
requirements
3.2. Leaner need to plan for development of future situations requiring
leadership
 Access Leadership Requirements

• The changing nature of society

• Significant changes are:
• Political
• Economic
• Social
• Technological
• Environmental
• Legal
 The Changing Face of Leadership

• In this climate of change, leadership is viewed as the key to organizational

success.

• Although the core qualities of leaders may remain constant, the manner
and mix in which they are exhibited needs to become more fluid and
matched to the context.

• The leader needs to become increasingly adaptable – making sense of

uncertainty and managing complexity.

• The qualities of openness, empathy, integrity and self-awareness are

coming to the fore
 The changing face of leadership

• Demand a more participative leadership style, not only involves colleagues

but listens is responsive to feedback and delegates responsibility

• Need to win the right to lead

• Lead from front

• Lead by example

• Need to create and communicate a shared long-term vision

 The Changing Face of Leadership

• As the need for good strategic leadership becomes critical, it is proposed

that further steps need to be taken to identify, develop and support
potential future leaders from an early stage.

• Changes in society are turning towards the moral, social and ethical
responsibilities of leaders.

• In response to these challenges , many organizations are beginning to

reevaluate their perception of leadership. Therefore, the quality of
leadership will remain of central importance to organizations in all sectors.
 Leadership Requirements in Diversity
• Despite the significant interest in the benefits of diversity, many managers
frequently face discriminations of stereotyping on grounds of their gender,
race or ethnic background, disability

• Another key variation is the skills and qualifications of the workforce.

Increasingly, work is knowledge-based and often requires the employment
of professionally qualified staff.

• Similarly, managers who work in global settings need to understand how

local cultures inform the values and behaviors of the workforce.
 Leadership Requirements in Diversity

• Diversity must become a strategic issue, and managers must have a vital
role in leading progress and changing practices.

• Diversity of behavior and values becomes very apparent when managers

work in a multinational company (MNC) or global organizations, and
leaders and mangers will need to learn to work in and with different
cultural contexts.
Leadership Requirements in Globalization

• Managers need to interact with staff, customers and suppliers across

international borders, whether face to face or other communications, and
consider the behavior of competitors from around the world, they face a
complex and dynamic set of factors which together represent the force of
globalization.

• There are different meanings or variations in the idea of global managers

and what they need to learn. For example- a manger who is assigned to
work in an MNC subsidiary which is located in another country will have to
understand particular ways of working and interacting with others in that
context. These managers are called international or expatriate managers.
 Leadership Requirements in Globalization

• Leaders or managers who have responsibility for integration across

different subsidiaries in different locations.

• These managers are called global managers.

• Turnbull-James and Collins (2010) suggest that global managers need

different capabilities that enable them to look and think beyond their local
environment, although research has tended to show that many
organizations promote managers on technical and organization skills
rather than their abilities to work globally.
 Leadership Requirements in Globalization

• Culture intelligence as suggested by Earley and Mosakowski (2004) is

concerned with a person’s capability to notice and understand different
facets of cultural behavior across different cultures or in multicultural
settings.

• Differences in cultural behavior can occur within and between

organizations as well as between countries and sub-regions within
countries. In all cases, such differences will be the result of traditions and
history.
 Leadership Requirements in Globalization

• Measurement and assessment of such intelligences for leaders can be

incorporated into an organization's global competences framework can be
derived from and linked to an organizations’ global strategy.

• Kets de Vries and Florent – Treacy (1999) suggested that 12 dimensions of

global leadership including envisioning, energizing, team-building, outside
orientation, emotional intelligence and global mindset.
 Leadership Requirements in Globalization

• The idea of global mindset has been further developed by others such as
Bowen and Inkpen (2009) and consists of three kinds of characteristics of
individuals:

– Intellectual (global business savvy, cosmopolitan outlook, cognitive

complexity)
– Social (intercultural empathy, interpersonal impact and diplomacy)
– Psychological (passion for diversity, quest for adventure and self-
assurance)

• Development of such characteristics can enable leaders to influence

others in cross-cultural situations.
 Leadership Requirements in Globalization

• Many multinational companies would consider cross-border assignments

the most effective way to develop global managers, as do managers
themselves.
• To provide support for learning from assignments , it would need to add
the availability of a mentor, especially since assignments that require
significant travel and residence abroad is likely to involve a
reconsideration of career and identity.
• In addition, action learning provides another source of support with
challenge when managers face inevitable issues of difficulty.
• Action learning can also be used by global team leaders to bring together
a culturally diverse and dispersed team.
 Leadership and Ethics

• Ethics seeks to establish principles of right behavior that may serve as

action guides for individuals and groups. It investigates which values and
virtues are paramount to the worthwhile life or society. (white, 1993:1-5)

• Ethical principles such as honesty, truthfulness, integrity or transparency

• Leadership and ethics are directly related. Effective leaders try to establish
a coherent truth, live by it, and encourage others to do the same. Effective
leadership is intrinsically ethical leadership and effective leaders
understand the importance of being ethical.
 Leadership and Ethics

• Many leadership theories do not tie leadership and ethics together. Under
those theories people are often considered effective leaders because they
have achieved some goal or have influenced their followers in a particular way.
Whether they were ethical or not in achieving their goals is considered an
aside.

• From a practical perspective this requires self-awareness and self-reflection.

• Through communication and collaboration leaders invite others to participate

in confronting the truth. They accept and acknowledge the fact that they do
not have all the answers and encourage others to help define suitable
solutions.

Reference: Annabel Beerel (2009); “Leadership and change management”, 1st ed,
SAGE Publications Ltd.
 Leadership and Ethics

• “Visionary” and “Moral” leadership is characterized by a more active

stance on CSR. Both require an idea/vision of where the organisation
should be in the future. Moral leaders derive their legitimacy in particular
from ethical principles on which their vision is based. Both types of
leadership focus on communicating their vision to stakeholders inside as
well as outside the firm. Moral and visionary leaders are strongly goal
oriented, but regularly lack the practical orientation to link goals and
vision to implementation.
 Leadership and CSR

• Transformational leadership is the most outward oriented type of

leadership and directed at formulating and implementing a new
organizational vision that is embedded in a broader vision of society and
the active involvement of external stakeholders. The key to real
transformational leadership lies in the effectiveness of their action.

Reference : Rob van Tulder; “ Leadership and CSR”; April 2006

 E-leadership

• E-leadership is no different from any other form of effective leadership.

• Leadership needs to recognize that the borderless, nationless force of the

internet creates global customers in a truly globalised market place the
interconnected world has created.

• The leadership challenge therefore is in dealing with the human lag, or

the social lag, to the technology spiral and the consequences of this.
 E-leadership

• How do you integrate leadership system and technology system?

• More than ever this requires having a 360% relationship with customer,
leaders and team. Feedback and exposure have become critical success
factors in the e-age. Information itself is not the critical component.

• The critical component is the unified support the organization offer the
customer for all products and services.

• Due to the e-world is a collaborative system, the leadership style needed

is one of total collaboration.
 E-leadership

• This very much depends on leadership style. It requires a high level of

transformational leadership because of the highly participative nature of the
e-world between e-organizations and e-customers and the
interconnectedness between leader and follower with the ever-increasing
reality of the blurred lines between the two.

• This has become the major management and leadership challenge because of
the power customers have in interacting through IT and in fostering demand
for goods and services.

• Transformational leadership is gained from a multiple of sources such as those

have acquired experientially, by programmed learning (school, university, etc).

• In the e-world, the key to a successful outcome depends on the level of

transformational leadership that exists in the organisation.
 Leadership requirements in mergers and takeovers

• Mergers and acquisitions almost always involve some level of

transformational change and disruption, successful post-merger
integration demands significant change on the part of both the acquiring
and the acquired organization.

• The acquirer creates changes in stated goals, strategies, ways of doing

things and customs. The acquirer also must deploy control mechanisms to
manage transformational change and achieve the strategic goals.

• The acquired organization must overcome any anxieties about being

“absorbed” and learn to integrate itself into new corporate procedures
and values.

• In short, a process of mutual adjustments must take place for post-merger

integration to succeed.
 Leadership requirements in mergers and takeovers

• Leaders set the priorities and create the positive business momentum and
discipline required during M&As. They instill in employees the necessary
level of commitment, engagement, confidence and comfort to work
through difficult transitions.

• Leaders, who by their statements and actions inspire a shared sense of

purpose, coherence, community and trust, enable employees to focus and
to remain highly engaged during M&As and post-merger integration.
 Leadership requirements in mergers and
takeovers
• During periods of transition and disruption, employees look first to
leaders for guidance about how to react and behave, for
motivation, and for focus.

• Mergers and acquisitions has a significant impact on how

employees of both organizations react and promote a sense of
community and purpose. Positive employee perception of leaders is
crucial to successful change.

• Employees want to believe that leadership cares about them and

they become more open and willing to make necessary transitions.
• M&As are more successful than in the past in part because of greater
attention being paid to leadership’s role in organizational culture creation
rather than destroying shareholder value.

• Companies can increase the success of M&A deals by focusing on aligning

leadership “fit” and actions with organizational cultures and business
strategy.

• The examples of GE’s acquisition of Marquette Medical Systems and

Prudential Financial acquiring CIGNA Corporation’s retirement business
show two highly successful M&As in which the active involvement and
visibility of leadership created the conditions for measurable business
success.

Reference: Richard M.Able; “ the importance of leadership and culture to

M&A Success”; Jan 16, 2007, Human Capital Institute
 Leadership Requirements in Restructuring

• Symptoms indicating the need for organizational restructuring.

• New skills and capabilities are needed to meet current or expected
operational requirements.
• Accountability for results are not clearly communicated and measurable
resulting in subjective and biased performance appraisals.
• Parts of the organization are significantly over or under staffed.
• Technology and/or innovation are creating changes in workflow and
production processes.
• Personnel retention and turnover is a significant problem.
• Workforce productivity is stagnant or deteriorating.
• Morale is deteriorating.
 Leadership Requirements in Restructuring

Expected results

• Improved productivity and morale.

• Reduced personnel turnover.

• Increased organizational effectiveness and efficiency.

• Creating a truly new entity from existing organizations is a

difficult proposition. Public and private companies in all sectors clearly
identify the needs and qualities of the organization they seek to create,
and build the right leadership team to get there.
 Integrity Leadership

• Trust is an inherit part of leadership. Team members have to trust that

leadership is serving everyone’s best interest and leadership has to trust
that team members are fulfilling their responsibilities.

• It is imperative that leaders lead with integrity, honesty and values. By

taking on this role, leaders invoke trust and respect from their team.

• Integrity is a quality that encompasses truthfulness, credibility and

sincerity. In a leadership position, integrity manifests itself in the way a
leader speaks to, guides and reacts to group members.

• Learning to lead with integrity requires developing self-awareness,

adhering to a strict moral code and communicating truthfully with group
members, regardless of the complexity of the situation or the possibility of
negative consequences.
 Leadership Requirements in Diverse Teams

• Today’s changes are just too complicated and dynamic to put the burden
solely on leaders to succeed.

• The combination of increasing globalization and widespread

developments in information communications and technology has given
greater emphasis to the opportunities for, and need of , virtual teams.

• Cultural diversity, which will be increasingly common, adds to the

complexity of managing virtual teams because different values, customs,
and traditions require more leadership under conditions that reduce the
ability to use direct leadership.
 Regulatory Compliance

• Environmental & Regulatory Leadership

• Why is environmental & regulatory performance important to business

organizations?

• Moral Imperative – it’s the right thing to do

• Compliance – it’s the law

• Business Drivers – reliable operations

 Partnerships and Alliances

• Building partnerships and alliances is more important not only in relationships

within departments of the organization; it has become more important for
relationships across the organization.

• As the work environment has become more complex, it has become necessary
to coordinate activities with crossfunctional teams and not just rely on the
traditional hierarchy.

• Alliances have the potential to create value, but most are difficult to manage.
When this happens, the alliance is not delivering its full potential value.

• Partnerships and alliances work best when all parties agree on and work
together to implement a common strategy to achieve business objectives. If
the organization wants the partnership to be successful, it has to plan for it.
 Partnerships and Alliances

Creating Successful Partnership

1. Strategic development
-clearly defined priorities
-ability to articulate goals
2. Partner assessment
-same goals?, same value?, past history?, alliance experiences?
-respect?, expectations?
3. Contract negotiation
-success measures
-rights, responsibilities, maximize strengths
4. Control/Implementation
-structure, process
 Partnerships and Alliances

• Requirements for leadership

• In-depth understanding of organization’s mission and operation
• Extensive, positive working relationship within organization
• Long-term perspective
• Open-minded
• Place high value on information sharing and is effective in communicating
at all levels
• Good mediator
• Seeks shared commitment and recognition for the contribution all
• Involve people who are concerned for partnership welfare
• Resolve conflicts promptly
• Hold regular reviews of partnership health
 Regulatory Compliance

Leadership Characteristics
• Credibility
• Collaboration
• Communication
• Vision
• Action Orientation
• Feedback & Recognition
• Accountability
• Establishing relationships with stakeholders
• Effective processes to assess impacts
• Apply environmental standards
• Effective regulatory approval strategies
• Foster reputation for delivering on
 Changes in Reporting and Control

• Command and control is by far the most common change leadership style.

• Most of today’s leaders were mentored themselves by command and

control managers, and the culture of most organizations is still based on
command and control norms

• Leadership style destroys virtually any chance of success in nine out of ten
transformational change efforts.
• A number of usually unspoken assumptions drive the use of command and
control.

• Leaders know best

• Leaders should know where they are going (goals, outcomes) and must
predetermine the plan for how to get there (process)

• Controlling human behavior and action during implementation

 Changes in Reporting and Control

• If leaders encounter unplanned variables, they must quickly control the

negative impacts on the change effort through problem solving and then
return to the implementation of their current plan

• Employees won’t naturally contribute positively to the change effort, so

leaders must “help” them by commanding and controlling their behavior
and involvement. Leaders must force people’s cooperation.
 New Technology

• Leaders should be wary of adopting the latest technology simply because

it’s state of the art.
• It’s important to adapt to the changing tides of technology, but it’s also
crucial to strike a balance between what you think you want versus what
your business actually needs.
• “What you really have to recognize that what moves people is not state-
of-the-art technology, it is state-of-the-heart technology
• Unless it moves something, unless it renders a benefit … unless it offers a
deeper meaning into your heart, into your soul, a deeper purposefulness.
 Interim Leadership

• Interim leaders are unencumbered by career goals, long-term bonds or

political affiliations within the organization. They have the detachment to
step back, observe what’s going on, and take in conflicting input as
valuable information without feeling compelled to act prematurely.

• They provide a neutral perspective that can reframe intractable problems,

defuse charged situations, and make difficult decisions.

• Interim leaders are perceived differently from incumbent leaders. Their

temporary presence and neutrality free them and the people within the
organization to establish a uniquely candid relationship.

• When an interim leader creates an open, nonjudgmental atmosphere,

employees feel safe sharing stories that have been suppressed out of fear
of retribution.
 Interim Leadership
• An interim leader can help employees understand what the incoming leader will
be looking for and how they will be evaluated, then help them set priorities and
accurately frame their value to the new leader.

• As a coach, the interim leader can help people unlock their untapped capabilities
and potential, and position themselves accordingly.

• As a mentor, the interim leader can share the benefits of experience and help
people sharpen their sense of how they add value to the organization.

• In the process of coaching and mentoring, people often develop a greater sense of
self-awareness. They see how they can position themselves based on a better
understanding of what the organization really needs to move forward.

• They also see what they need in order to move forward in their own lives and
careers.
Developing Strategic Management and
Leadership Skills

Topic-7
Learning Outcomes
LO-4. Be able to plan the development of leadership skills

Assessment criteria
4.1. Learner needs to plan the development of leadership skills for a specific
requirement
4.2. Learner needs to report on the usefulness of method used to plan the
development of leadership skills
 Introduction
• According to Investors in People, leadership development is not just a
corporate issue: The ability to create and communicate a clear vision, and
motivate people to deliver it, is as important to the small entrepreneur as
to the leader of 1,000 people.

• All organizations should be identifying the managers they will need in a

few years’ time and developing them.

• All top managers should be planning their succession and supporting the
people who will step into their shoes when it’s time to move on.

• Education and training in management needs to emphasize not only

interpersonal skills but also a flexibility of approach, diagnostic ability and
the realization that the most effective form of leadership behavior is a
product of the total leadership situation.
 Seven Principles for Developing Leaders

• Adair identifies seven key principles of leadership development that can

be applied successfully in different kinds of organizations in both the
public and private sectors

1. Development of a strategy for leadership development for each of the

three levels of leadership- operational, strategic and team
2. Selection of those with high potential for becoming effective leaders.
3. Training for leadership- Identifying business training needs in the
leadership context and assign them priorities
4. Career development through giving a person the right job at the right
time. People grow as leaders through the actual practice of leading
 Seven Principles for Developing Leaders

5. Line manages as leadership developers by developing the individual’s

potential and sharing their knowledge of leadership

6. Corporate culture that is valued at all levels and should encourage a

climate of self development in leadership

7. The chief executive who should be leading from the front and who owns
the problem of growing leaders.

• The seven principles are complementary and are likely to have a

synergetic effect if applied as whole
 Leaders as Architects of Collectives

• According to Hill, world – class companies in the 21st century will be ever-
evolving collectives of talented, passionate and diverse individuals.
Leaders will be the architects of these collectives.

• The strategic management of talent has become the key to competitive

advantage.
 New Skills and Competencies

• Bannis suggests that the leaders of the future will have to cast off the
heavy burden of command and control, hierarchically based leadership.

• Leaders will have to learn an entirely new set of skills and that four
competencies will determine the success of new leadership.

1. The new leader understands and practices the power of appreciation

2. The new leader keeps reminding people of what is important
3. The new leader generates and sustains trust
4. The new leader and the led are intimate allies
 Development of Leadership Skills

• Different methods of developing leaders through

• Formal learning,
• Self- help
• Developmental activities eg training courses, job rotation, seminars,
executive coaching, mentoring, companies 'own universities,
developmental assessment centers, action learning, self – directed
learning, reading articles, partnership with key academics
 Development of Leadership Skills
• Burnes (2003) suggests most organizations tend to leadership
development as a distinct subject, whereas the leadership development
plans often to fail.
• One reason is that manager's needs are not in accord to organization's
needs, and organization has less emphasis on experimental learning
(Shanley, 2007).
• It was thought that leadership development is created by training
individual skills and abilities. There are some reasons for leadership
development within organization:
• to increase benefits by right leadership;
• to save time and cost;
• to permit employees’ promotion and advancement by develop new
talents;
• to make stimulus to persuade individual development (Addison &
Cunningham, 2009).
 Development of Leadership Skills

• Some surveys present following processes regarding leadership

development:
• 1. To identify organizational challenges: the required leadership
competencies should define to confront organization present and future
challenges in organization. These questions may be raised: What is your
organization vision? Which are the performance goals? What are doing to
attain this vision?
 Development of Leadership Skills

• 2. To identify and prioritize leadership needs: the required leadership

resources should summarize to confront organization mission challenges.
To consider leadership needs, it is necessary to focus on these questions
for develop leaders’ traits: How leader’ behavior could be an obstacle to
introduce organization needs? How the leadership development could
help organization to describe its own goals? What changes may need
within system to support development plan?

• 3. To adjust leadership competencies with organization goals: The

leadership needs should adjust to leaders’ competencies when they are
attained. A useful tool is the database base on leaders’ competencies.
 Development of Leadership Skills

• 4. To specify selected persons and to determine competency level for per

leader: Competency level for per leader should determine, that it attains
by leadership development activities.

• 5. To realize presented format: A required format should plan to attain

outcomes. What learning events are needed to help leaders’
competencies? (Hammett, 2008).

To raise leadership development, it is necessary to study specific activities for

leadership development. To choose any activity, it depends to goals and
strategies of the organization.
 Development of Leadership Skills

• Surveys shows the successful organizations focuses on building the

comprehensive set of leadership development activities, as they support
large extent of talents through organization (Amagoh, 2009).

• Choosing activities such as coaching, development centers, and feedback

360 are correlated to development (McDowall & Mabey, 2008).

• In addition to above methods, Gerstberger & Snyder (2006) present the

following leadership development processes:
 Development of Leadership Skills

• Leadership valuation: using analysis tool for leadership effectiveness and

feedback 360 system that prepare comprehensive data of managers and
supervisors about leadership traits;

• Leadership training workshops: a leadership training workshop in two

days presents leadership principles;

• Two types of chief leadership development activities in the successful

organizations, coaching and feedback 360.
 Development of Leadership Skills

• Coaching: Coaching emerges as a significant tool for training and

development and it emphasizes on specific issues correlated to real life
(Jones et al., 2006).

• Coaching usually consists on series of sessions between a coach and a

trainee (Palmer & Whybrow, 2004).

• Coaching is different compare with training. Training is usually a one-way

relation. Managers can train your employees to do tasks, but employees
may not realize or accomplish their managers’ expectations.

• Coaching is a two-way relation. When trainees realize consequences, the

trainers present feedback and permit trainees to justify their activities
again.
 Development of Leadership Skills

• This process is continuum until they achieve the expected results

(Champathes, 2006).

• Therefore it provides the practical learning opportunities for trainees

(Toit, 2007).

• The coaching success depends on partnership between organization and

trainer (Stewart & Palmer, 2009). Meanwhile, the main aim of coaching is
facilitation of performance, learning, and individual development
(Downey, 2003).
 Development of Leadership Skills

• Feedback 360: Performance appraisal or valuation aimed at development

is a vital element in HRM (Dierendonck et al., 2007).

• For the first time, Lawler (1967) mentioned appraisal based on one source
could not provide enough information to performance appraisal.

• The performance difficulties could be possible by multiple-information.

Feedback 360 or multiple-appraisal is the process of collecting useful
information of multiple-source relevant to an individual.
 Development of Leadership Skills

• Individuals usually receive feedback from multiple internal and external

sources, such as supervisor, managers, subordinates, and sometimes
customers.

• Any source provides specific feedback (Rensburg, 2006). In fact, feedback

from multiple-source can be a valuable source for performance
(Dierendonck et al., 2007).

• This tool is used to evaluate the competencies and behaviors which relate
to individual’s job performance (Korotov, 2006).
 Development of Leadership Skills

Mentoring
• Following evaluation and feedback, the mentoring scheme will be rolled out
more widely to provide support and expertise for continued professional
growth and expand mentees professional networks and support
transformational thinking and experimentation.

• Mentoring training will be provided by some professional organization.

• Mentoring means you take someone under your wing and teach her one-on-
one over a period of time. It includes teaching people as you lead, as
described above, but it is a bigger and more significant process.

• When you mentor someone, you make a commitment to her. You help her
become a leader by teaching her what you've learned and by encouraging her
as she takes on new challenges.
 Development of Leadership Skills

• For example, you might sit down and listen to someone you are mentoring
after he tries to lead a focus group for the first time. Listening can really
help him think through his experiences so he is ready for the next
challenge.

• Your confidence in another person and commitment to her as a developing

leader is one of the most effective ways to help her become a leader. It is
also an important contribution, because you are helping to develop a
person who has the potential to be leading for years to come.
 Development of Leadership Skills

Exchange programs

• Sometimes it helps to do a leadership exchange with another group or

organization. You can trade staff or volunteers for a period of time, so each
group gets to learn how another group works.

• People can learn skills that aren't available in their own organization. Even
a visit to another organization can give people a picture of new
possibilities.
 Development of Leadership Skills

Orientations

• Whenever a new person becomes part of your organization, whether as a

staff person, volunteer, or member, an orientation is important to help
him get on-board quickly.

• People want to feel that they are doing a good job, and they need the
information and training in order to do their jobs well.

• Giving people the help they need early on is a worthwhile investment of

your group or organization's time. If people are left on their own when
they first begin, they can often feel left-out or resentful.
 Development of Leadership Skills

• Make sure the new person gets:

- The training he needs to get the job done

- A history of the organization
- A chance to learn about the mission, policies, and procedures of the
organization
- An understanding of what help is available and how to get it
- A chance to meet people in the organization
- A warm welcome
 Development of Leadership Skills

Workshops and training sessions

• Workshops can help your whole group move forward on key issues.
Perhaps your group needs a workshop on decision-making, fundraising, or
creating an action plan.

• Having a workshop that addresses key issues can set the organization on
the right track. If the workshop solves a long-term problem, it also has the
potential of lifting morale and renewing commitment.
 Development of Leadership Skills

Retreats

• Retreats can be excellent for revitalizing or refocusing groups or

organizations. A retreat can help a group identify new goals or plan new
strategies. A retreat can also be used when the organization is poised to
take a new direction and when everyone must understand the coming
changes in order to make the change successful.

• Retreats can help people recommit to the mission of the organization.

They can also help people remember the importance of their relationships
to each other as they work together.
 Development of Leadership Skills
• To insure the success of a retreat you should:
– Check with the group to verify that this is something they want to do
– Get a commitment from members to attend
– Set the date well in advance, so that people will be able to come
– Find a comfortable and accessible retreat location--preferably away
from your regular workplace
– Have clear goals
– Be realistic about what can be accomplished in the period of time
allotted
– As much as possible, get input in planning the retreat from
participants
– Make sure there is active participation
– Make sure people have enough time to connect
– Make sure the facilitators are competent
 Development of Leadership Skills

Leadership groups

• Leaders need ongoing development too. Leaders need relationships with

other leaders to help them keep growing and get through the difficulties
they face. As leaders, we sometimes feel isolated in our jobs; we need
others to listen to our thinking, and we need to listen to others' ideas.

• To do this, you can set up a peer leadership group. Invite leaders from
other organizations to meet every other week or once a month. In these
meetings you can talk about your experiences of being a leader, both the
rewards and the difficulties.
 Development of Leadership Skills

Leadership groups

• Leadership groups can also be valuable for a group of leaders inside your
organization. If you regularly convene a group in which people can
support one another's individual leadership, that can help them focus on
their work and keep growing.

• Now that we've examined some different leadership development

activities, lets see how to develop a leadership plan for individuals in your
group or organization.
 Development of Leadership Skills

Recruiting new people to lead

• Recruiting new members and volunteers is a key element of leadership

development. It should be part of your leadership development plan.
Why? Here are a few reasons.

• First, new members are your next generation of leaders. People always
leave groups or organizations for a variety of reasons. They move to
another city, or take a demanding new job, or their interests simply
change.

• Therefore, you need new people who are ready and willing to take the
lead. Otherwise, the loss of one or two active leaders can seriously hurt a
group or organization.
 Development of Leadership Skills

• Second, bringing new people into an organization keeps new ideas coming
in and keeps your group vital. New people will test your assumptions and
challenge you to think about your ideas afresh.

• Third, bringing new people into your organization is the foundation of

community building. The more people you have working for your cause,
the more powerful you will be.

• When you recruit a new member or volunteer, give him a job that brings
him into the center of the organization as soon as possible. That way he
will feel welcome and needed. Ask him what he thinks about
organizational issues.
 Development of Leadership Skills

Develop yourself as a leader

• Remember, you are in this picture, too. You will need leadership
development in order to continue to grow. The more you succeed at
leading, the more difficult challenges will come your way. People will see
you as a resource and they will bring you harder and harder problems to
solve.

• So, draw up a leadership development plan for yourself. Get additional

training when you need it; go to conferences that address issues that
concern you; and form relationships with other leaders who can give you a
hand when you need it. Paying attention to your own leadership
development will not only make you a better leader, but will also make
your organization a better organization, as well.
 Development of Leadership Skills
• In addition to developing a leadership plan for your organization as a
whole, it is useful to develop a leadership plan for each person in your
organization. But first, let's look at how your view of leadership can affect
how people grow as leaders.

Expecting people to act like leaders

• If you expect people to act like leaders, they are much more likely to do so.
• Leadership is an activity in which everyone can participate at some level.
Everyone has a point of view that is valuable. Everyone has talents to
share. When we think about whom to train for leadership, it's easy to
overlook people who don't fit our stereotypical image of a leader.
 Development of Leadership Skills
• For example, we often don't consider quiet or shy individuals to be potential
leaders. Many of us also make inaccurate assumptions about an individual's
leadership potential based on the cultural, racial, gender, or income groups that a
person belongs to.

• Of course, in reality, potential leaders come in every imaginable size, shape, and
background. There are leadership riches all around us. Your expectations can go a
long way in helping people stretch their perceptions of themselves and what they
can accomplish.

• In the words of John Gardner in his book On Leadership: "Most men and women
go through their lives using no more than a fraction -- usually a rather small
fraction -- of the potentialities within them. The reservoir of unused human talent
and energy is vast, and learning to tap that reservoir more effectively is one of the
exciting tasks ahead for humankind".

• Set leadership development goals for individuals

 Leadership Development

• Kettley and Strebler (1997) note that ‘formal business education and
training for senior managers is increasingly context specific, delivered in
partnership with external experts and focused on new business concepts
and strategic learning.

• Many are experimenting with more individually focused approaches to

learning including coaching, counselling and personal feedback.’
 Leadership Development

• Many companies have defined generic and/or senior management

competencies, although they vary in the extent to which these really
underpin management development.

• Holbeche (1998) identifies many companies using competency

approaches, 360 degree feedback, personal development plans and
assessment centres to help link their succession planning processes with
corporate and management development strategies.

• Many companies have also determined a set of generic leadership

competencies warns against ‘the limited shelf life of success profiles
when business requirements change’.
 Action Learning

• Action learning was developed after the Second World War by Reg Revans
(Revans 1998) in order to provide management development which would
be relevant to the workplace and to the real life problems faced by
managers.

• The method draws upon the shared learning which happens within the
group as members work towards finding solutions.

• Members are working on actual problems arising from their jobs rather
than on artificially produced case studies or simulations.

• This means that the topics reflect the real life situations in which
managers find themselves. Such situations are often complex,
contextualized and unique.
 Creating Learning Climate

• Learning should be constant, and supervisors can create the culture for
making it happen through encouraging staff learning independently or in
small groups.

• Group meetings in an agency can be structured in a way that puts a focus

on learning.

• Participatory learning including teaching, role play practice, and problem

solving are often the best ways for adults to acquire new knowledge and
skills.
 Model for Assessing Future Leadership
Requirements
• Council for excellence in Leadership and Management diagnostic tools

• Leadership competencies eg- thinking and acting strategically

• Emotional intelligence

• Social intelligences

• Ability to learn

• Systems thinking
 Organization-level Diagnostic Tools

• Investors in People is one example – particularly now that the ‘core’

National Standard has been augmented with the Management and
Leadership Model, but a range of quality-related tools also fall into this
category.

• Using tools like these may well indicate the need for leadership and
management development initiatives to be undertaken, and give
important indications of relevant priorities and outcomes to aim for.
 Organization-level Diagnostic Tools

• Training needs analyses may point to the need for some form of
leadership/ management development from the perspective of the
organisation as a whole, but will not normally support self-diagnosis at
the level of the individual owner or manager.

• Organisation-specific tools: Particularly in larger organizations, much

management and leadership development activity is triggered through
internal appraisal/ review procedures, and techniques.

• These can clearly align well with self-diagnostic approaches, but gather
data from a very different perspective – drawing primarily on the
perceptions of colleagues and performance against previously-agreed
objectives.
 Competencies
• It is important to establish a competency model that reflects the attributes and
skills of successful leaders as defined by the company culture.

• For example, the skills needed to succeed in retail sales differ from those needed
to successfully sell a technology product.

• In a retail environment, key skills include knowledge of customer service, security,

the store’s policies and procedures, and point-of-sale system operation.

• Some retail environments require depth of technical knowledge. For example,

salespersons who sell automobiles need to be able to explain the features of
various models, the manufacturers’ specifications, the types of options and
financing available, and the details of associated warranties.
 Conclusion

• No one is a Born Leader

• Everyone can develop leadership skills
• Everyone can benefit from using them.
 Honestly Analyze Yourself

• Very beginning point is to “Learn to understand yourself”

•It’s the first step to understanding others
1. What kind of leader am I? One who helps solve problems? A leader who
helps people get along? How do others see me as a leader?
2. What are my goals, purposes, and expectations in working with this
particular group?
 Identify areas for Improvement

1. Do I try to be aware of how others think and feel?

2. Do I try to help others perform to the best of their abilities?
3. Am I willing to accept responsibility?
4. Am I willing to try new ideas and new ways of doing things?
5. Am I able to communicate with others effectively?
6. Am I a good problem solver?
7. Do I accept and appreciate other perspectives and opinions?
8. Am I aware of current issues and concerns on campus or in my community?
After analyzing your strengths and weaknesses-take
action
1) Communicate effectively.
• Effective communication is dialogue.
• Barriers are created by speaking down to people, asking closed questions
that elicit yes or no answers, using excessive authority, and promoting a
culture that depends on harmony.
• If your focus is winning the argument or if you react defensively to
criticism, you’ll create fear of openness and hinder the organization’s
growth.
2) Encourage enthusiasm and a sense of belonging. Show:
• Friendliness: others will be more willing to share ideas
• Understanding: everyone makes mistakes. Try to be constructive, tolerant
and tactful when offering criticism.
• Fairness: equal treatment and equal opportunity lead to an equally good
effort from all group members.
• Integrity: members will take tasks more seriously if you show that you’re
more interested in group goals than your own personal gain.
3) Keep everyone working toward agreed upon goals:
• Remind everyone of the group’s purposes from time to time.
• Provide encouragement and motivation, by showing your appreciation for
good ideas and extra effort.
• Harmonize differences and disagreements between group members by
stressing compromise and cooperation.
• Involve everyone in discussions and decisions, even if asking for opinions
and ideas means a longer discussion.
4) Get to know the people around you

• Everyone has different abilities, wants, needs, and purpose in life.

• To get along with others and get results, you need to get to know them.
• Interact with group members as often as possible.
• The only way to get to know someone is through direct personal contact.
• Become familiar with every member of your group.
• Take note of each person’s unique qualities and characteristics.
5) Treat others as individuals

•Put your knowledge and understanding of each group member to work!

•Be aware of expectations, recognition, a chance to learn, a chance to work
with other people, etc.
•Be creative: A successful leader thinks of new and better approaches to old
ways of doing things.
•Provide rewards: Recognition by the group is a source of personal
satisfaction and positive reinforcement for a job well done.
•Delegate responsibilities: if everyone shares the work, everyone can share
pride in the group’s accomplishments.
•Let each member know what’s expected of him/her, available resources,
deadlines, etc.
6) Accept responsibility for getting things done
•Take the initiative. Why stand around and wait for someone else to get
things started?
•Offer help and information: Your unique knowledge and skills may be just
what’s needed.
•Seek help and information: Ask for advice if you need it.
•This will encourage group involvement and help
•Make things happen: By being decisive, energetic, and enthusiastic, you can
and will help get things done!
•Know when and how to say “no.” If your time and resources are already
committed, turn down extra tasks, but do it nicely.
7) Problem solve in a step-by-step way
•Whether you are faced with a decision to make or a conflict to resolve,
following a logical approach will help.
•1. State the problem as simply and clearly as possible.
•2. Gather all relevant information and available resources.
•3. Brainstorm as many ideas or solutions as you can think of (with others if
possible).
•4. Evaluate each idea or solution and choose the best one.
•5. Design a plan for using your idea or solution.
•6. Follow up on your plan by asking if your idea worked and why or why
not.
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