What is the Link between strategic management and leadership? Link Between Strategic Management & Leadership
“Since change is the function of leadership, being able to generate highly energized behavior is important for coping with the inevitable barriers to change. Just as direction setting identifies an appropriate path for movement and just as effective alignment gets people moving down the path, successful motivation ensures that they will have the energy to overcome obstacle.”
The basic difference between managers and leaders is that managers don’t accept any change rather they believe in stability but leaders are supposed to bring changes. A leader has strategy and vision while a manager has plans and he executes his plans.(Kotter, 1990). As it is obvious from the given scenario that Dan J. was not able to handle challenges which his Printing Company encountered due to rapid change in technologies, competitive market, increasing expenses and pressure of pricing. He was working more like a manager, specifically store manager, than a leader. (Griffin , R. W. 1999). As John P. Kotter suggested that the change is the function of leadership and strategic decisions means decisions leading to substantial changes in management processes. Hence, Strategic Management and Leadership are closely related or in other words, inseparable. In fact, the terms leadership and strategic management are interchangeable because a leader performs key function like initiating, planning, supporting, controlling, evaluating, etc. Their other responsibilities include building, developing maintaining a team and achieving a common goal by keeping the individual member of the team motivated. (Griffin , R. W. 1999).
“As strategic leaders, top level managers must guide the firm in a ways that result in formation of strategic intent and strategic mission. This guidance may lead to goals that stretch everyone in the organization to improve their performance.” - Griffin , R. W. 1999
Strategic management is a process of coordinating technological, financial, material andhuman resources of an organization for enabling it and its stakeholders in achieving stipulated target efficiently and effectively. Strategic management is a wide term in comparison to leadership as far as scopes are concerned because leadership is mainly limited to organizing, directing and supporting individuals or the human resource in order to achieve the stipulated goal whereas strategic management refers to all resources within an organization.
Strategic leadership plays key role in responding to the challenges which businesses have to face due to rapid changes in technology, growing competition and globalization. Dan J. was facing the same problems and the business was declining tremendously. The stock prices were very high due to rise in the market. (John Adair, 2010)
Impact of leadership styles and management on strategic decisions There are different types of leadership styles like Autocratic, Bureaucratic, Charismatic, Democratic, Laissez- faire, etc. (Richard L.H. and Katherine C. B. 2005) 1. Autocratic leadership style: when the leaders use absolute powers in making decisions. This is more prevalent in military and Adolf Hitler is a good example of it. In corporate world, United Aviation Services (Dubai) is known for autocratic leadership. 2. Bureaucratic leadership: when the leader follows the strict theories of leadership defined in books. This style is followed where safety measures are prominent specially working on machines. 3. Charismatic leadership: When the followers are highly inspired by the leader and believe blindly in their leader. Mahatma Gandhi was a Charismatic leader.. 4. Democratic leadership: When team members are included in decision making by the leader. This helps in building team spirit and motivating all by increasing trust, skill and confidence. 5. Laissez-faire leadership: When the leader leaves the team members to take...