1 Chapter Thirteen Strategic Leadership and Knowledge Management © 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

2 Learning Objectives  Describe the nature of strategic leadership.  Explain how to use the SWOT model to assist in strategic planning.  Identify a number of current business strategies.  Describe how leaders contribute to the management of knowledge and the learning organization.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 3 The Nature of Strategic Leadership Strategic leadership is the process of providing the direction and inspiration necessary to create or sustain an organization

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 4 Figure 13-1 Components of Strategic Leadership

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 5 Five Components of Strategic Management 1.Thinking at a cognitively high level 2.Gathering multiple inputs from many sources 3.Anticipating and creating a future; setting the direction towards that future 4.Adopting a revolutionary or contrarian outlook 5.Ultimately, creating a VISION

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 6 SWOT Analysis  Examines the interaction between the organization or group and its external marketplace  Strategic planning often takes the form of a SWOT analysis, a method of considering Strengths, Weaknesses, Opportunities, and Threats in a particular situation

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 7 Examples of SWOT Elements  Strengths: Favorable location, talented workers, state-of-the-art equipment  Weaknesses: Unfavorable location, outdated equipment, limited capital  Opportunities: Culturally diverse customer base, changes in technology, deregulation  Threats: E-commerce, declining market, new competitors

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 8 Business Strategy Levels  Corporate-level strategy asks, “What business are we in?”  Business-level strategy asks, “How do we compete?”  Functional-level strategy asks, “How do we support the business- level strategy?”

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 9 Sample Strategies  Differentiation  Cost leadership  Focus or niche  High quality  Imitation  Strategic alliances  Growth through acquisition

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 10 Sample Strategies (cont’d)  High speed and first-mover strategy  Product and global diversification  Sticking to core competencies  Brand leadership  Creating demand by solving problems  Competitive advantage through hiring talented people

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 11 Knowledge Management and the Learning Organization  Knowledge management (KM) is a concerted effort to improve how knowledge is created, delivered, and applied  Knowledge management helps create a learning organization. A learning organization is skilled at creating, acquiring, and transferring knowledge, and at modifying behavior to reflect new knowledge and insights

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 12 Knowledge Management Three Components 1.Knowledge creation spurs innovation, e.g., training, seminars, professional development, degree completion 2.Knowledge dissemination allows workers access to key information and support, e.g., intranets, web portals, databases 3.Knowledge application helps workers apply learning to their jobs, e.g. mentoring, shadowing, on-the-job training, workshops

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 13 Figure 13-2 Where Corporate Knowledge Lives

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 14 General Format of KM Programs  Sophisticated computer-based systems  Interactive technology  Videoconferencing technology  Sharing anecdotes through these systems and channels

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 15 Pitfalls of KM Programs  There is a human tendency to hoard information  Workers prefer face-to-face sharing versus entering data into a computer  Data entry can undermine the intuitive spark often created through interpersonal interactions  It is difficult to decipher what information is truly useful

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 16 Initiatives to Enhance Organizational Learning  Create a strategic intent to learn  Create a shared vision  Empower employees to make decisions and seek continuous improvement  Develop systems thinking  Encourage personal mastery of the job

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 17 Initiatives to Enhance Organizational Learning (cont’d)  Encourage action learning  Learn from failure  Encourage continuous experimentation  Develop political skills to make connections with and influence others  Encourage creative thinking

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 18 Summary  Strategic leadership deals with the major purposes of an organization or organizational unit  Five important components of strategic leadership include high-level cognitive ability, multiple inputs to strategy formulation, anticipating and creating a future, revolutionary thinking, and creation of a vision

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part. 19 Summary (cont’d)  Strategic planning often takes the form of a SWOT analysis  Strategic leaders use many different types of business strategies  Leaders must help their organizations adapt to the environment by taking initiatives to create a learning organization