International Journal of Information Technology and Business Management

29th March 2016. Vol.47 No.1

2012-2016 JITBM & ARF. All rights reserved

ISSN 2304-0777

www.jitbm.com

A CONTEMPORARY APPROACH TO STRATEGIC LEADERSHIP

Cenk Lain ARIKAN1, Didem ENGNOLU2
1

Asst. Prof., Department of Business Administration, Gediz University, Izmir, Turkey

Lecturer (PhD.), Program of Business Administration, Gediz University, Izmir, Turkey
E-mail: [email protected], [email protected]

Abstract
Different leadership styles have been thoroughly studied in various situations over the past three decades. All
this accumulated knowledge seems not to mask the growing interest in strategic leadership. Leadership style of
organizations forms and impacts the strategies at both individual and organizational levels. Effective leadership
has positive impacts on both firm performance and competitiveness. Integrating strategy and leadership is a
critical factor for the future of firms. Strategic leadership is regarded as an effective and crucial management
tool which helps firms in operating successfully in highly competitive market conditions. With this study we dwell
into the research that has aggregated in terms of strategic leadership styles. Literature on strategic leadership
highlights certain findings that point toward a common understanding, but nevertheless there are many areas
which are left less than clear. An in-depth discussion of the major approaches and a review of contemporary
challenges facing strategic leaders of today are presented and directions for future research are presented.

Keywords: Strategy, strategic leadership, strategic decision making, organizational

performance, competitiveness.
conditions strategic leadership is expected to be
more of a critical issue within both leadership and
organizational studies.
This paper looks into the major
contributions made by the researchers in strategic
leadership arena and compiles together a modern
understanding which can further be utilized in
model building and finally hypothesis testing.
Therefore this is an initial effort to combine and
make sense out of the relevant approaches and
significant findings researchers have accumulated
in time.

INTRODUCTION
Over the past three decades leadership
studies have focused on several common
categorizations [6]. One of these main
categorizations
is
the
transactional
/
transformational / charismatic leadership styles.
Despite an overwhelming emphasis on these more
classic approaches [2], more recent studies have
considered a wider span of areas within leadership
and have included authentic, responsible, and
servant leadership styles as well.
Interestingly enough, in the very wellstudied leadership concepts and styles in particular,
strategic leadership stands out to be one of the most
seldom researched topics. We claim that in the near
future there will be more emphasis on this topic due
to the need to understand the real dynamics behind
strategic changes taking place inside organizations
and the real creators of such changes.
Top managements strategic interventions
are critical in determining success in strategic
execution [26]. Strategic decisions and actions
cover competitiveness issues, financial choices, and
resource allocation. Thus, strategic leadership is
directly related with corporate sustainability [24]
and organizational performance [22]. In this regard,
in todays increasingly competitive business

STRATEGIC LEADERSHIP
Strategic leadership has been defined in
many different ways. Almost all definitions
consider the top managements characteristics, their
way of doing things, and the way they affect
organizational performance [9]. The boards,
executives, and top management teams naturally
play significant roles in determining the strategic
direction and how the strategy gets translated into
everyday execution. In this regard, strategic
leadership also encompasses how the methods
preferred by top management gets translated into

International Journal of Information Technology and Business Management

29th March 2016. Vol.47 No.1
2012-2016 JITBM & ARF. All rights reserved

ISSN 2304-0777

www.jitbm.com

action through organizational communication

schemes.
Strategic leadership concept can be traced
back to the work of Hambrick and Mason [11] and
Bass [1] where the transformational leadership
concept was introduced. All strategic leadership
approaches owe greatly to these initial steps in the
sense that major and more modern understandings
like envisioning the future, articulating the path,
and accompanying on the implementation phases
have risen from these contributions [17]. More
classic views on leadership have focused on
transactional leaders that get things done no matter
what, whereas with the introduction of this new
perspective leadership has gained a fresh
understanding which values supporting the
subordinates and leading with them instead of
despite of them.
There are several different perspectives as
to the nature and the level of analysis of strategic
leadership which have evolved in the literature so
far. Boal [4] claims that there is a link between
strategic leadership and organizations past, present,
and future. According to him strategic leadership
focuses on strengths and weaknesses of
organizations and opportunities and threats of the
external environment. Ireland and Hitt [14] define
strategic leadership as a competency to envision
proactively, think strategically, and struggle for the
organizations future at the individual level.
According to Elenkov et al. [8] strategic leadership
is a process of creating a vision, motivating
employees, forming strategies at both individual
and organizational levels.
Burgelman and Grove [5] identify strategic
leadership as a strategizing process which provides
better corporate sustainability and longevity.
According to Narayan and Zane [16] strategic
leadership is influenced by two major elements,
namely internal and external elements. Internal
elements are the organizations structure, vision,
values, goals, strategies, and management style. On
the other hand, external elements are composed of
customers, suppliers, partners, competitors,
investors, and government.
In an attempt to uncover the dynamics
taking place in strategic leadership issues, Ozer and
Tinaztepe [19] have conducted a quantitative study
covering 215 executive respondents. Their findings
suggest that among transformational, transactional,
and paternalistic leadership styles relationshiporiented strategic leaders are most common in
business environments.
The distinction between leadership and
strategic leadership is critical in understanding the
role of strategic leadership concept in modern

business settings. According to Hambrick and

Pettigrew [12] leadership theory is more general in
essence. There are leaders at every level of
hierarchy in the organization and leadership focuses
on the relationship between leaders and their
followers. On the other hand, strategic leadership
focuses on strategies and the organizations future
[25] and therefore is solely focused on top
management and the effect it exerts on the overall
organization. Norburn [18] emphasizes the kind of
different roles middle managers and top managers
play.
Strategic actions taken through the
strategic leadership function of top management
and executives reflect themselves mainly in three
categories [3]. These categories are 1)
competitiveness issues, 2) financial choices, and 3)
resource allocation decisions. Competitiveness
issues cover acquisitions and the kind of strategic
alliances companies may engage in. Financial
choices include the kind of cash management and
investment strategies executives prefer. Resource
allocation decisions have both more day to day
operational consequences as well as more structural
fixed asset related results.

CHARACTERISTICS

OF

STRATEGIC LEADERS
Schoemaker and Krupp [21] identify six
distinct abilities of strategic leaders. These abilities
are as follows:
1) Anticipating Ability: This ability refers to
evaluating and responding to signals from
the organizations business environment
for struggling against the rivals.
2) Challenging Ability: This ability refers to
thinking creatively and finding creative
solutions for problem solving.
3) Interpreting Ability: This ability refers to
developing hypotheses about dynamic
environmental conditions.
4) Deciding Ability: This ability refers to
generating and evaluating excess options
for forming organizations strategies and
designing its future.
5) Aligning Ability: This ability refers to
motivating employees around the strategic
vision and values.
6) Learning Ability: This ability refers to
knowledge acquisition from the external
instead of the internal environment.

International Journal of Information Technology and Business Management

29th March 2016. Vol.47 No.1
2012-2016 JITBM & ARF. All rights reserved

ISSN 2304-0777

www.jitbm.com

Utilizing and sustaining core competencies

and turning them into performance measures
require leaders of organizations in todays world to
be more engaged in developing human capital. As
the abilities and the knowledge of the workforce get
more advanced employees way of being led and
motivated naturally is expected to evolve as well.
Strategic leadership, thus, can be viewed to fill this
gap in modern organizations. Long-term success
can be achieved through more employee
involvement as practiced in participative
management techniques.
Transformational leaders resemble a lot of
the qualities of inspirational, charismatic, and
visionary leaders [25]. According to Rowe [20] the
most important part of strategic leadership is
influencing employees in the whole organization.
He determines the characteristic of strategic leaders
as follows:
- Integration of managerial and visionary
leadership
- Emphasis on ethical conduct and ethical
decision making
- Management of daily operations and longterm strategic responsibilities
- Development and the execution of
strategies to enhance organizational
competitiveness
- Having a strong foresight for future
performance of organization
- Usage of strategic and financial tools for
strategic control
- Share of explicit and implicit knowledge
on individual and organizational levels
- Utilization of linear and nonlinear thinking
and management tools

Figure I. Strategic Leadership within and amongst

three levels
Source: Crossan et al. [7], pp. 570

Ireland and Hitt [14] explain the components of

strategic leadership as 1) determining of
organizations vision and goals, 2) exploiting and
sustaining organizations core competencies, 3)
developing human capital, 4) maintaining an
effective corporate culture, 5) emphasizing ethical
behaviors, and 6) designing a balanced control
system. They further claim that especially in the
21st century organizations depend more heavily on
the positive effect strategic leadership has on
creating and sustaining competitiveness. According
to them highly competitive nature of the global
economy combined with the requirements of the
modern competitive landscape make it a necessity
for the organizations that top executives be more
insightful in determining and executing the
corporate strategies. Their views can be widened to
include organizations in general.

STRATEGIC

MAKING

PROCESS
Harrison [13] emphasizes that strategic
decisions are related to organizational assessments
and environmental assessments. He identifies the
elements of organizational assessments as
management style, technology, policies, and
resources. According to him environmental
assessments consist of opportunities, threats,
strengths,
weaknesses,
requirements,
and
responsibilities. Therefore, strategic decisions must
define the relationships between organization and
its business environment, must analyze all
departments and lead to both operational and
managerial activities of the organization

Crossan et al. [7] define strategic leadership as the

integration of three dimensions. These dimensions
are leadership of self, leadership of others, and
leadership of organization.

Leadership of Self

Strategic
Leadership

Leadership of
Others

DECISION

Leadership of
Organization

International Journal of Information Technology and Business Management

29th March 2016. Vol.47 No.1
2012-2016 JITBM & ARF. All rights reserved

ISSN 2304-0777

www.jitbm.com

Figure II. Strategic Decision Making Process

Possibilities
Opportunities
Threats

Environment

Environment
Assessments

Search for
Alternatives

Evaluate Alternatives

Information
Strategic Gap

Gap Analysis

Set / Reset Objectives

Correction
Action

Make Choice

Positive Gap
Negative Gap
Organizational
Assessments

Assess Choice

Implement Choice

Strengths
Weaknesses
Feedbacks
Primary Flow

Corollary Flow

Outputs

Information Flow

Source: Harrison [13], pp.50.

According to Mador [15] in the literature strategic

decision making has created three main concepts as
the key characteristics. These characteristics are
comprehensiveness, extensiveness, and speed.
Comprehensiveness refers to short term decision
horizons and rationality of management.
Extensiveness refers to long term planning and
decision horizons. Speed refers to fast decision
making in very dynamic environments. Strategic
leaders can make their decisions and create
differences by choosing varying degrees of these
three characteristics.

Evaluating the results of the strategic

decision and controlling whether or not the
desired targets are achieved.

Steptoe-Warren et al. [23] define the role of

strategic leaders as strategic thinkers who
understand both the internal and external factors
which impact the organizations future. They
explain strategic thinking as two distinct processes.
These processes are planning and thinking.
Planning comprises of analysis, systems, and
policies whereas thinking is made up of strategies,
innovation, and creativity. Therefore, the
integration of strategic thinking and the decision
making process can be regarded as the new and
contemporary way of dealing with the rivals.
Struggling in the modern competitive environments
are no longer enough to sustain strategic success
over time. Strategic leaders act as strategic thinkers
and in this way they provide a competitive edge to
their organizations.

Strategic leaders behaviors affect organizational

decision making process. Strategic leaders have to
focus on organizations external environment.
According to Friday-Stroud and Sutterfield [10]
strategic leaders should consider the following
criteria in their strategic decision making process;
- Setting the organizational goals, mission
and vision clearly;
- Performing analyses such as SWOT
analysis, pest analysis, gap analysis, and
statistical
analyses
using
relevant
management tools;
- Determining standardized performance
measures;
- Attaining and allocating appropriate
financial and nonfinancial resources to
perform the decision;

CONCLUSION
As competition intensifies in almost all
industries there is a growing necessity for firms to
create and sustain more effective leadership.
Leadership theory is concerned with every
hierarchical level of leaders whereas strategic

International Journal of Information Technology and Business Management

29th March 2016. Vol.47 No.1
2012-2016 JITBM & ARF. All rights reserved

ISSN 2304-0777

www.jitbm.com
[6]

leadership focuses on only top management and its

effects. Since strategic leadership is unique for each
company, basing competitiveness on such an
almost impossible attribute to imitate stands out to
be a great path. Strategic leadership not only creates
a competitive advantage for the company, but it
also generates a climate within the organizational
culture that permeates all employees.
Not all strategic leadership practices fall
under the good practice category. Sometimes, as
research
has
shown,
strategic
leaders
characteristics
intervene
negatively
and
unfortunately in the face of effectiveness the
company and the employees suffer. Thus, the vision
and the ethical codes of the strategic leaders
determine the quality of the practice. In general,
literature shows that strategic leaders are better at
being process focused rather than being only
outcome focused. In this sense, strategic leadership
is not only directing the behavior of the employees
but also accompanying them on the way.
Strategic leadership concept lacks sound
models. Therefore we assert that, as a next step,
model building can benefit the accumulated
knowledge in many ways. Due to the unique
characteristics of strategic leaders we recommend
that more qualitative research be focused on rich
intra-organizational facts. Each strategic leader has
certain features that differentiate him/her from the
rest. As researchers create more models the
construct will eventually reveal more critical
underpinnings that widen our perspectives
regarding organizations and the management
practice.

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[9]

[10]

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2012-2016 JITBM & ARF. All rights reserved

ISSN 2304-0777

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