1. Copyright © 2014 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education. Strategic Leadership: Creating a Learning Organization and an Ethical Organization chapter 11

2. Strategic Leadership  Leadership is the process of transforming organizations from what they are to what the leader would have them become.  Successful leaders are Proactive – dissatisfied with the status quo Goal oriented – visualizing successful futures Focused on the creation & implementation of a creative vision – understanding the process 11-2

3. Exhibit 11.1 Three Interdependent Leadership Activities Strategic Leadership 11-3

4. Strategic Leadership  Setting a direction requires the ability to scan the environment for knowledge about All stakeholders Salient environmental trends & events  Then integrate that knowledge into a strategic vision of what the organization could become A clear future direction A framework for the firm’s mission & goals Leading to enhanced employee communication, participation, & commitment 11-4

5. Strategic Leadership  Designing the organization requires building mechanisms to implement the leader’s vision and strategies through Structures & teams Systems & processes  Lack of appropriate design could cause problems Managers who don’t understand their responsibilities Reward systems that are not motivating Inappropriate financial systems Insufficient integrating mechanisms 11-5

6. Strategic Leadership  Nurturing an excellent and ethical organizational culture is a key leadership activity, requiring that managers & leaders Accept personal responsibility for developing & strengthening ethical behavior Consistently demonstrate that such behavior is central to the mission & vision of the firm Develop & reinforce Role models Corporate credos & codes of conduct Reward & evaluation systems, policies & procedures 11-6

7. Strategic Leadership: Overcoming Barriers to Change  Leaders must overcome barriers to change  Organizations are prone to inertia, slow to learn, adapt, & change because of Vested interests in the status quo Systemic barriers Behavioral barriers Political barriers Personal time constraints 11-7

8. Strategic Leadership: Effective Use of Power  Leaders must make effective use of power Influence other people’s behavior Persuade them to do things they otherwise would not do Overcome resistance & opposition  Sources of power Organizational bases of power Legitimate, reward, coercive, information Personal bases of power Referent, expert 11-8

9. Strategic Leadership: Effective Use of Power 11-9 Exhibit 11.2 A Leader’s Bases of Power

10. Strategic Leadership: Emotional Intelligence  The valuable traits of successful leaders: Technical skills – like accounting, operations research Cognitive abilities – like analytical reasoning, quantitative analysis Emotional intelligence – like self- management, managing relationships with others Self-awareness, self regulation, motivation, empathy, social skills 11-10

11. Strategic Leadership: Emotional Intelligence 11-11 Exhibit 11.3 The Five Components of Emotional Intelligence at Work Source: Reprinted by permission of Harvard Business Review. Exhibit from “What Makes a Leader,” by D. Goleman, January 2004. Copyright © 2004 by the Harvard Business School Publishing Corporation; all rights reserved.

12. Strategic Leadership: A Learning Organization  Successful learning organizations Create a proactive, creative approach to the unknown Actively solicit the involvement of employees at all levels Enable all employees to use their intelligence & apply their imagination  A learning environment involves An organization-wide commitment to change An action orientation, applicable tools & methods 11-12

13. Strategic Leadership: Creating an Ethical Organization  Ethics deals with right and wrong Ethical beliefs come from religion, ethnic heritage, family practices, community standards, educational experiences, friends & neighbors  Organizational ethics promote an operating culture & determine acceptable behavior Ethical beliefs come from the values, attitudes, & behavioral patterns of leadership Unethical business practices involve the tacit, if not explicit, cooperation of others 11-13

14. Strategic Leadership: Creating an Ethical Organization  The ethical orientation of the leader is a key factor in promoting ethical behavior  Integrity & ethical values Shape behaviors Provide a common frame of reference Act as a unifying force Have a positive effect on employee commitment & motivation to excel Can create value & a competitive advantage 11-14

15. Strategic Leadership: Creating an Ethical Organization  Ethical frameworks for integrity include:  The compliance-based ethics program Prevents, detects, & punishes legal violations  The integrity-based ethics program Enables ethical conduct Examines organizational members’ core guiding values, thoughts, & actions Defines responsibility & aspirations for ethical conduct 11-15