Strategic leadership is widely used but needs to be understood. Strategic leadership is a set of behaviors rather than a position or a person.
Arguably, the primary responsibility for strategic leadership lies at the organization’s top. Nevertheless, C-suite leaders must be strategic Leaders for some time for their communities to reach and maintain a competitive benefit.
However, what exactly is a strategic leader supposed to do, or in other words, what are the elements of strategic leadership? In an era characterized by fleeting competitive advantages, deep uncertainty, rampant corruption, and a deteriorating natural environment, strategic leadership must have the following elements.
Setting the strategic direction
Determining strategic direction is the most important strategic management task, especially in today’s volatile and uncertain business environment.
Determining strategy starts with defining the business area. In this industry, a company is, and more importantly. In this industry, the company is not (Lafley, 2009) because this definition provides a framework for all business decisions, e.g., what kind of organization it needs to business.
To build, what kind of innovation should it pursue, and what kind of mergers and acquisitions should it engage in?
Defining a company is more complex because other stakeholders own diverse views and attractions, and it is overly attractive to keep the gate open without dictating what the party should not do.
When choosing a strategy, strategic Leadership, in reserve to offset the interests of stakeholders, must also consider the company’s external environment so that the system can be adjusted in reaction to important environmental differences.
Building adaptable and flexible organizations
Organizations must learn to adapt to change, and strategic Leadership must therefore focus on learning environments that support learning (where workers feel psychologically safe to express opposing views, take risks, and make mistakes),
specific learning processes and practices (for experimenting, gathering and sharing information, coaching) and leadership behaviors (active listening, seeking other perspectives, and asking probing questions) that contribute to a culture of learning (Garvin et al., 2008).
Experimentation is a form of understanding and feeling fortune. Therefore, the ability to experiment frequently, cheaply, and quickly with products and services processes, business models, and strategies can be considered an essential organizational capability contributing to rapid adaptation (Reeves & Deimler, 2011).
Strategic solid relationships with suppliers, distributors, customers, and even, where possible, competitors are an essential intangible resource (called colonial money for communities by Hitt et al., 2010) in explosive and insecure conditions because such associations do not deliver corporate ticket-only necessary information regarding forthcoming differences in technology, developments, strategies, and trade models,
while even helps in joint experimentation and development of new products, services, and technologies, thereby providing significant strategic flexibility. Strategic Leadership must maintain such relationships at both the organizational and individual levels.
Leading for present and future business growth
No matter how robust, competitive advantage will eventually wither, which can happen quickly and suddenly in a volatile environment. Thus, strategic Leadership must show the constant innovation of outcomes, operations, and enterprise standards in their communities.
Founded on a recent innovation study, Pisano (2015) ranked creations along two measurements (technology and industry standard) into four kinds: systematic creation (living technology and living industry ideal), disruptive invention (living technology and unique company instance), and extreme.
Innovation (new technologies and existing business models) and architectural innovation (new technologies and new business models).
While routine innovations improve existing products or services (e.g., a new iPhone model) and strengthen an existing strategic Leadership position, the additional three kinds of creation develop unique market prospects (e.g., Apple iTunes).
The researchers found that incumbents do well in sustaining/routine innovation but do not do well in disruptive innovation for two reasons.
incumbents tend to focus more on existing customers and thus support/routinely innovate as existing customers evaluate, and the operating internal processes of companies and the decision rules that have made them successful until now prevent them from directing their investments toward disruptive innovations (Christensen et al., 2015).
The first reason is echoed by Kim and Mauborgne (2015), who state that market creation strategies as a customer-centric approach are seen as one of the six red sea traps and suggest that organizations should focus on non-customers to enter new markets create sea).
The challenge for strategic Leadership is to create harmony between inventions that support the existing call work and new demand options and create an administrative civilization that sustains both kinds of creation.
In his book Unrelenting Innovation, Gerard J. Tellis (cited by Hayashi, 2013) suggested that culture is the most critical driver of innovation in any organization and identified three characteristics of an innovation culture: willingness to cannibalize existing products and risk.
Attitude and ability to focus on the future. However, strategic Leadership must ensure that this culture (especially risk-taking attitudes) does not lead to unethical behavior.
Ethical leadership
Ethics begins where the law ends and addresses questions of right and wrong from the perspective of social mores and moral norms that still need to be codified as law (Crane & Matten, 2010).
The problem with social mores and ethical standards still need to be reflected in the law is that there is no consensus on them. Hence, business ethics is in a gray area, and there is no definitive correct answer to many ethical problems (Crane & Matten, 2010).
Globalization has also confused this difficult case because ethical matters brought forth in one society may be asked in another. Although moral problems are concerned, strategic leaders must determine corporate matters and moral norms.
As Peter Drucker said, “CEOs define the organization’s values, norms, and ethos. Either they lead or they lead astray.” (cited in Lafley, 2009, p. 61).
Among the individual and contextual factors that influence ethical decision-making in organizations, contextual factors should attract the attention of Strategic Leadership, as they are “to at least as important and possibly more important in shaping our ethical decision-making” (Crane & Matten, 2010 p. 160).
Among the contextual factors, the reward system, authority behavior, and organizational culture significantly impacted ethical decision-making (Crane & Matten, 2010).
Therefore, strategic Leadership should ensure that reward systems and corporate culture promote ethical decision-making and that those in positions of power, including themselves, should be led by example.
Zhu et al. (2016) discovered in their investigation that authorities who regularly pay awareness to moral problems are sensed as honorable heads by their supporters, and more significantly, managers’ moral understanding has a favorable impact on supporters’ moral awareness.
Accountable administration
Company managers increasingly know that companies have social, environmental, and economic responsibility.
For example, nine thousand of companies have joined the UN Global Compact since its beginning in 2000, and 75% of the planet’s biggest businesses now utilize the Global Reporting Initiative to monitor and write about their sustainability performance (Kiron et al., 2017).
However, for-profit strategic Leadership faces two challenges: on the one hand, how to approach the organizations’ economic responsibilities in solving these problems, and on the other hand, how to approach them when social and environmental responsibilities collide with economic ones. Related.
In the first case, strategic managers must transform relevant social and environmental problems into business opportunities and pursue both goals (Porter & Kramer, 2011), “Creating Shared Value (CSV)” paradigm.
Porter and Kramer (2011) suggested three methods for co-creating weight:
- Rethinking products and markets (developing products and services to meet social needs).
- We are redefining productivity in the value chain to reduce resource consumption.
- Enabling local cluster development (to address the weaknesses) of communities). which limits own productivity and business growth).
Turning social and environmental problems into business opportunities is also challenging, so such efforts are still limited to a few large companies.
In this case, the role of strategic Leadership is vital to redefine corporate identity through top-down commitment and multi-stakeholder engagement, then codify the new identity through employee engagement and develop sustainable strategy implementation (Eccles et al., 2012).
However, there is no simple answer to the second challenge. Solving such social and environmental problems requires initiatives led by business and government. For example, financing research and developing a low-carbon solution is burdensome for companies.
In that case, several companies can cooperate to finance the project, and the government can encourage participating companies through fiscal policies. Strategic Leadership must be actively involved in driving these initiatives forward.
Strategic leadership is about making decisions on behalf of an organization and its stakeholders that significantly impact the organization’s present and future, but sometimes also on society’s current and future.
Therefore, strategic Leadership must approach issues from a long-term perspective and look at problems holistically. Strategic managers must also get the buy-in of critical stakeholders to ensure that their decisions translate into practical actions.
Success depends mainly on how strategic Leaders relate their organizations to the ever-changing external environment. Only strategic managers can do this.