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What is a Strategic Leader?

Question:

Discuss about the Role of a Strategic Leader in High Firm Performance.

A strategic leader is described as a person who provides direction and vision for purposes of success and growth of an organization. Firm performance is the ability of an organization to demonstrate its success using high-level strategies to meet beat the market competition. The strategic leader conceptualizes a vision and wisely converts all other members to achieving set objectives. Through strategic leaders, interests and momentum of employees is sustained by driving positive energy towards accomplishing long-run objectives. Firms that are steered by such leaders have become successful operations at a group and individual level. However, to become a strategic leader, there are a lot more traits that should be possessed both visionary and administrative. To have a strategic leader means that an organization has a strong-willed leader who can stand out even when everything is falling apart. This leader always comes up with discoveries for his employees in efforts to improve an organization's productivity. Strategic leaders are made and not born as was early suggested. This is because these are the normal individual trained through their work experience and understanding of diverse market needs then bridging the identified gaps with quality services and products. The paper will critically analyze the role of a strategic leader in ensuring the success of firms.

In the contemporary world, there is sophisticated competition, threats and challenging opportunities for organizations. To thrive in such uncharted business, a firm requires a strategic leader who has all the qualities of making sound decisions to keep the firm's performance on the top level. To meet the competing business demands, strategic leadership is emerging as the primary area of focus for both academics and businesses (Cameron, 2014).  Lack of strategic leadership in a firm, it becomes difficult to sustain the required market competition efficiently. It is therefore clear that superior businesses do not evolve from sheer luck; the choice of leaders mostly determines their performance. Organizational pressure is increasing, and the call to deliver positive results is building up in every firm. Businesses are also willing to work with less and expecting quality outcomes. Such a scenario becomes difficult for any leader, and only strategic leadership can drive positive changes of an organization into a better future (Zhexembayeva, 2014).

The chairman is one of the top leaders for an organization. The chairperson heads the organization board, involves in setting the company’s agenda and ensuring the group works through effective and timely communication (Cameron, 2014). He or she acts as a link between the non-executive and executive members through ensuring a great working relationship for discussing strategic issues.

Importance of Strategic Leadership

On the other side, the Chief executive Officer (CEO) focuses on effecting policies and decisions from the board. The CEO sets the company’s vision, manages resources and overall operations. Some companies may opt to combine the position of the board chairman with that of the CEO. For instance, Marks and Spencer company combined the roles and handed responsibility to the then CEO, in 2008.

Tremendous increase in business conducted online has given rise for the need of Chief Technology Officer (CTO), who focuses on strategies on technology advancement and information in a company (Kvint, 2009). Change management is a critical tool that every strategic leader should have in order move the firm forward. Change management involved being able to develop analyze the market needs and respond promptly with a feasible solution (Beatty, 2010). For instance, in the case where a bank is wholly dealing with manual transactions, a strategic leader should be able to analyze the fast-changing technology and be able to suggest a swift change towards embracing the new technology. In this case, a decisive leader can propose new techniques of transactions such a use of mobile apps and wireless money deposits and transfers to make transactions fast, easy and economical (Laszlo, 2011).

Further, a strategic leader should be able to identify the peak seasons for business and ensure during such periods, there is maximized sales and profits. Besides, a strategic leader should be able to understand changing processes and skills in the market and efficiently transfer the knowledge to the employees. This may include offering on-the-job training and refresher courses that will help workers adjust and conform to the modern procedures of production to keep organizations on the move. Strategic leaders can only perform such roles because they have futuristic thinking (Handler, 2010).

The non –executive directors (NED) are part of the strategic leaders in an organization. The NED involves in the scrutiny of management systems and performance visa vie the set objectives and goals. Also, the NED assists in the development of strategic proposals, oversight of remuneration packages, appointment and succession of executive directors (Cameron, 2014).

Organizational structure is a significant element that helps in building strategic leaders and at the same time improves firm's productivity. An organizational structure provides a breakdown of the manner in which different individuals work. It begins with the leading management down to the lower level workers. For a well-performing organization, an organizational structure is an indispensable tool. The top-most executive officer should be a strategic individual and the one who serves as an example to others. When the top management is well trained and competent, the lower workers automatically adopts to hard work and positive drive towards achieving the best (Kvint, 2009). Further, by having a strategic leadership it does not mean to operate in a dictatorial manner, it means being dynamic, inclusive and one who seeks opinions of the low-ranked workers to understand their thoughts and then make the final decisions about the way forward. However, there arises an issue with finance when there is a problem or misunderstanding between the principals and agents. This brings about the agency theory that brings into a limelight what can cause conflicts among top leaders and firms' principals. For instance, the agents may have their work plan and future expectation that the principals are not aware. The plan can include expanding an organization to outside markets. This means that the expenditure will increase and the amount intended for the shareholders will reduce tremendously. In this situation, it becomes difficult for any leader to operate, as any move will affect the financiers of the firm that cannot be entertained. Therefore, a strategic leader will be able to rise above such situations through making reasonable changes to the company through consultations with all shareholders to reduce operation challenges (Nag, 2011).

Qualities of a Strategic Leader


To build high performing organization, it is important to have strategic leaders who can make the forecast of the market performance. This involves having information about changes before things happen. For instance, a strategic leader should be able to know issues to do with inflation, changes in stock markets, political instabilities, and technology in a timely manner. Having such information is a great milestone and can ensure adequate changes are made before the firms are affected (Heskett, 2009). For instance, in 2008/2009 financial crisis, many organizations such as General Motors were affected to the point of filing for bankruptcy relief. It took the efforts of governments to bail them. In such times, strategic leaders should have prior information to be able to change the organizational approaches and beat the storms. For instance, a decisive leader can know of a looming financial crisis in the near future. A strategic leader could respond to this by laying off some employees or reducing by all possible means, the firm's expenditure budget to cater for future losses (Tichy, 2016) 

Motivation is an essential aspect toward developing high performing firms. A strategic leader to make people work for a common good can use this move. In instances, where the manager or a leader is not interested in motivating the employees, then there is a decrease in productivity as workers only force their way to work for getting basic needs. In such cases, only a strategic leader can break this kind of notion and drive positive change and energy to the workers (Mintzberg, 2011). As the most critical resource in the firm, a strategic leader should motivate the employees to work hard through offering attractive rewards, leaves, holidays and regular meeting with employees. This invokes the stewardship theory that observes that employees are in most cases motivated by their work. The theory argues that workers get intrinsically motivated by working for organizations through accomplishing responsibilities and tasks they are given. It creates an impression that workers are pro-organization, collective-minded, and not individualistic. This motive makes them work aimed at attaining societal, the group and organizational goals as doing so makes them feel satisfied. It is however through positive motivation by a strategic leader that makes employees adopt the stewardship theory (Quong, 2010).

Firms are part of managerial functions. Throughout the world, leading companies such as Apple, Microsoft, HP, Kodak and General Electric are defined through their founders. Leaders in these organizations maintained their grounds and developed competitive brands. Consequently, they survived through global competitions to emerge the best (Wack, 2010). Through the lens of such organization, the aspect of strategic leadership can be felt. This is because; these firms have gone through much pressure concerning quality, pricing, and ethics to emerge the best through efforts of managers.  This is because in every organization the organization performance reflects the work of top leaders, hence the development of Upper Echelons theory. It is a theory that explores traits held by senior managers and concludes that performance levels and strategic outcomes are predicted efficiently by looking at managers. This theory explains the reason firms are more than ever concerned about strategic leadership than anything else (Hill, 2011).

Impact of Strategic Leadership on Organizational Productivity

Power is a critical element in the performance of any organization. Understanding the diverse abilities of an organization reports are provided on weekly or monthly bases regarding the way a firm is performing.  This invokes the theory of board power, which is said to have the huge influence over strategic leadership. Board meetings are the ultimate decisions making bodies in any organization. However, the differentials in power reflect on the outcomes and processes an organization applies. For instance, when boards make their sittings they develop a framework for ensuring things work well for a firm. However, the outcomes and actual practices may be different bringing out a huge gap. Board directors have a duty of making decisions for an organization disciplining, crisis meeting, and offering advice but are not there during implementation. This brings about the role of a strategic leader in the board (Mulcaster, 2010). A leader, who will be able to close this gap and balance the expectations of the board and the realities of implementing their decision. This approach is similar to that of top managerial teams that evaluate the exploitation and exploration of strategic board decisions and spearhead organizational ambidexterity. This is a critical perspective that aims at identifying changes in the behavior of the board members towards the organization. This process can only succeed in the case where a firm has a strategic leader to oversee the different functions. Therefore, the top-level management has an essential role in influencing organizational performance and developing culture, structure, policies and reward systems in organizations. To create superior firms, it is critical to have top with excellent skills. This is what is referred to as discretion and which is influential to an organizational performance (Beatty, 2010).


These perspectives state that performance of an organization is a result of hard work and cooperation between employees and their managers. Strategic leaders are a crucial party as they ensure hard work through making workers build high levels of commitment together with creating a culture of empowerment. To achieve these objectives, a strategic leader should be able to articulate his or her views simply to make all shareholders understand (Kemp, 2013). It is of a higher significance for any strategic leader to explain to the employees about choices made and then build a capable team to undertake the work. Nonetheless, a strategic leader should be above all smart and able to instill the bigger picture in employees to achieve positive performance. In addition, a firm will compete locally and globally in an efficient manner when a strategic leader is creative and one able to survive in ever changing the business environment (Rowe, 2014).

Conclusion

The strategic leader has a crucial role in contributing positively towards high firm performance due to own discretions. Strategic leaders form special force in today's organizations. This kind of a leader makes essential decisions coupled with shareholders to come up with a winning idea about capitalizing on profits. A strategic leader has been termed as a person who can predict the future of a firm and make strategic moves in attempts to avoid any future impacts. A strategic leader has also been termed as the ultimate driver in any fir and who bears the burden of a good or bad name of a company. Most importantly, a strategic leader has abilities to motivate his or her employees to work hard towards achieving organizational objectives. A strong message is therefore directed towards contemporary firms, that to have high performance in the market, the role of a strategic leader is vital.

References

Beatty, Q, 2010. The Strategic Commands for taking the Long Views for an Organizational Success. Leadership Action, Vol. 30(1), pp. 3-7

Cameron, T, 2014. Using responsive evaluation on Strategic Management. The Strategic Leadership Review, vol. 4 (2), pp. 22-27

Handler, A, 2010. Strategy and Structure: Chapters in the history of industrial enterprise, Doubleday, New York,

Heskett, M. 2009. Managing in the Service Economy, Harvard Business School Press, Boston,

Hill, J, 2011.  Strategic Management Theory: An Integrated Approach, Cengage Learning

Kemp, R, 2013. Strategic Planning of the Local Government: A Handbook for Officials and Citizens, McFarland

Kvint, V, 2009. Global Emerging Markets, the Strategic Management &Economics Excerpt, London

Laszlo, N, 2011. Embedded in Sustainability: the approach of the market leader. European Financial Review

Mintzberg, R 2011. The Nature of Managerial Work, Harper & Roe, New York, page 38

Mulcaster, W., 2010. Three Strategic Frameworks," Business Strategy Series, Vol. 10, No 1, pp. 68–75

Nag, H, 2011. Strategic management that works, an Inductive derivation of consensus Strategic Management Journal.vol.28 (9): 935 to 955

Quong, W, 2010. Seven Principles of Strategic Leadership International Studies Education Administration (ISEA) Vol38,

Rowe, W. G. 2014. Creating Wealth in Organizations -Role of Strategic Leadership, Academy of Management Executive, 81-94

Tichy, N, 2016. Managing Strategic Change: Technical, political, and cultural dynamics, John Wiley and Sons, New York,

Wack, P, 2010. Scenarios: Uncharted Waters Ahead", Harvard Business Review, New York

Zhexembayeva, N. 2014. Overfished Ocean Strategy, Powering Innovation for a Resource-Depleted World. San Francisco, Koehler Publishers

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