Strategic leadership involves determining a firm's strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing controls. Effective strategic leadership is required to successfully implement strategic management and has five major components: determining strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing balanced organizational controls such as financial and strategic controls.
Strategic leadership involves determining a firm's strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing controls. Effective strategic leadership is required to successfully implement strategic management and has five major components: determining strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing balanced organizational controls such as financial and strategic controls.
Strategic leadership involves determining a firm's strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing controls. Effective strategic leadership is required to successfully implement strategic management and has five major components: determining strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing balanced organizational controls such as financial and strategic controls.
Strategic leadership involves determining a firm's strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing controls. Effective strategic leadership is required to successfully implement strategic management and has five major components: determining strategic direction, managing resources, sustaining culture, emphasizing ethics, and establishing balanced organizational controls such as financial and strategic controls.
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CHAPTER 7: STRATEGIC LEADERSHIP Top management team - composed of the key individuals
who are responsible for selecting and implementing the
Strategic leadership- the ability to anticipate, envision, firm’s strategies. maintain flexibility, and empower others to create strategic Heterogeneous top management team - composed of change as necessary. individuals with different functional backgrounds, Effective strategic leadership - a prerequisite to successfully experience, and education. use the strategic management process. Figure 12.2 Factors Affecting Managerial Discretion Effective strategic leadership has five major components: 1) Determining the firm’s strategic direction 2) Effectively managing the firm’s resource portfolio 3) Sustaining an effective organizational culture 4) Emphasizing ethical practices 5) Establishing balanced organizational controls. Figure 12.1 Strategic Leadership and the Strategic Management Process
Internal managerial labor market - consists of a firm’s
opportunities for managerial positions and the qualified employees within that firm. External managerial labor market - the collection of managerial career opportunities and the qualified people who are external to the organization in which the opportunities exist. Figure 12.3 Effects of CEO Succession and Top Management Team Composition on Strategy
Top-level management decisions influence the culture of
firms as well as how organizations are structured and how goals are set and achieved. Top-level managers - an important resource for firms to develop and exploit competitive advantages The primary factors that determine the amount of decision- making discretion held by a manager are: 1) external environmental sources such as the industry structure, the rate of market growth in the firm’s primary industry, and the degree to which products can be differentiated; 2) characteristics of the organization, including its size, Determining strategic direction - involves specifying the age, resources, and culture image and character the firm seeks to develop over time 3) characteristics of the manager, including Core competencies - capabilities that serve as a source of commitment to the firm and its strategic outcomes, competitive advantage for a firm over its rivals. tolerance for ambiguity, skills in working with - Relate to an organization’s functional skills, such as different people, and aspiration levels manufacturing, finance, marketing, and research and development. Competitive agility - an ability to act in a variety of disseminating the code of conduct to all competitively relevant ways stakeholders to inform them of the firm’s ethical Competitive speed - an ability to act quickly when facing standards and practices environmental and competitive pressures developing and implementing methods and Figure 12.4 Exercise of Effective Strategic Leadership procedures to use in achieving the firm’s ethical standards creating and using explicit reward systems that recognize acts of courage creating a work environment in which all people are treated with dignity. Organizational controls - formal, information based procedures used by managers to maintain or alter patterns in organizational activities. Two organizational controls: 1) Financial control - focuses on short-term financial outcomes Training and development programs can provide the 2) Strategic control - focuses on the content of means by which new strategic leaders are cultivated within strategic actions rather than their outcomes. an organization. Balanced scorecard - a framework firms can use to verify that they have established both strategic and financial controls to Human capital - refers to the knowledge and skills of a firm’s assess their performance entire workforce. - A tool that helps strategic leaders assess the Social capital - involves relationships inside and outside the effectiveness of the controls. firm that help the firm accomplish tasks and create value for Four perspectives are integrated to form the balanced customers and shareholders. scorecard framework: Organizational culture - consists of a complex set of 1. Financial - concerned with growth, profitability, and ideologies, symbols, and core values that are shared risk from the shareholders’ perspective throughout the firm and influence the way business 2. Customer - concerned with the amount of value is conducted. customers perceive was created by the firm’s Five dimensions characterize a firm’s entrepreneurial products mind-set: 3. Internal business processes - with a focus on the 1) Autonomy – allows employees to take actions that priorities for various business processes that create are free of organizational constraints and permits customer and shareholder satisfaction individuals 4. Learning and growth - concerned with the firm’s 2) Innovativeness –reflects a firm’s tendency to engage effort to create a climate that supports change, in and support new ideas, novelty, experimentation, innovation, and growth and creative processes that may result in new Figure 12.5 Strategic Controls and Financial Controls in a Balanced products, services, or technological processes. Scorecard Framework 3) Risk taking –reflects a willingness by employees and their firm to accept risks when pursuing entrepreneurial opportunities. 4) Proactiveness –describes a firm’s ability to be a market leader rather than a follower. 5) Competitive aggressiveness – a firm’s propensity to take actions that allow it to consistently and substantially outperform its rivals. Strategic leaders can take several actions to develop an ethical organizational culture. Examples of these actions include: establishing and communicating specific goals to describe the firm’s ethical standards continuously revising and updating the code of conduct, based on inputs from people throughout the firm and from other stakeholders