Strategic Leadership:
The Function and Contribution of CEOs to Success in
Modern Business Practice

by Mohammed Miah,
Linda K. Gaughan Ph.D. and
Jeffrey Wallmann, Ph.D.

Although the duties of Chief Executive Officers are manifold, and their job descriptions are specified in every way imaginable, the bottom line is that their underlying responsibility is to cultivate and develop value for their companies. They may be "the captain of the ship," but unless they keep ship and crew paramount in mind, above the fact that they are captains, they are likely to sink the ship and send the crew jettisoning for safety. In other words, no matter how inspiring a vision CEOs may have for their companies, such visions can only be translated into reality by the actions of their employees. Hence, in order to function effectively, CEOs need to be aware of the impact that their creative powers have on current and future corporate success.

This sounds obvious, a given. As evidenced by the high rate of business failures, however, far too many CEOs have forgotten if they have ever learned this fundamental point. For example, rivalry within management, mis- or no communication between departments, and similar areas of friction among employees are blatant hindrances to implementing corporate visions, and CEOs strive to eliminate them. Yet the historical remedy has been to impose a hierarchical top-down pattern of management, which, due to extensive evidence garnered over the past four decades, has shown to be ill conceived and counter-productive. It is therefore distressing to realize that even today, with global competition as fierce as it is, a great many American corporations are still locked into, and suffering from, this authoritarian and micro-managing style of leadership. Many variations, such as appointing administrators or managers as "instructional leaders" to promote teamwork and company loyalty, tend in practice to produce teams of subordinates who simply follow administrative or management commands. While challenging to implement, more effective teaming models truly allow collaboration and shared leadership and responsibility (Elder, 2000).

CEOs discarding discredited hierarchical systems instead desire to maximize employee support and cooperation in pro-active ways, so that together they all can help ensure the corporation achieves its perceived future. They require, of course, a methodology that is pragmatic, efficient, and suitable throughout a corporate structure. A number of methods have been tried and proven flawed, if not outright backfired and failed. So far, though, one strategy has shown remarkably consistent and successful results. It is rooted in the hypothesis that from top managers to file clerks, all employees need to know more than simply their own particular duties; they also need to participate in activities engineered to translate a corporate vision into reality. These activities include developing skills in problem-solving, decision-making, collaboration, continuous planning, strategy development, and critical thinking - training, in essence, in becoming "strategic leaders" (Julius, Baldridge, and Pfeffer, 1999; Stark, Briggs, and Rowland-Poplawski 2000).

The strategies of "strategic leadership"

The strategies of "strategic leadership" -- or "transformational leadership" as termed by Leithwood (1992) -- involve generating trust and collective action that empower participants, and through them others, by facilitating their mission and vision, renewing their commitment, and restructuring systems for goal accomplishment (Opatz and Hutchinson, 1998). Additionally, strategic leaders must be educated and informed, because only those literate in appropriate theoretical knowledge can apply theory in a practical manner. Hence, strategic leadership should be regarded as interactive leadership, demonstrated by employees who are team players willing and able to create change, keep the corporation on target, and produce the desired results (Miah, 2002). When measured for effectiveness, strategic leadership consistently shows that it works, with the greatest improvements tending to occur when practitioners - such as counselors, supervisors, trainers, and other influential personnel -- assume responsibility for collaborative efforts in the development, revision, refinement of corporate vision, and implementation of effective management processes to translate the vision to reality.

However, two challenges need to be addressed when implementing strategic leadership. One challenge is common to all but the most dictatorial forms of leadership - the need for a free-flowing conduit of information throughout the levels and divisions of the organization, which will provide constant, relevant, and relatively simple data for ready analysis. This problem is more acute, naturally, in a system such as strategic leadership, which relies so heavily on employee involvement and cooperation. A second problem tends to arise when CEOs adopt leadership styles closely related to their own personalities, rather than styles best suited to the needs of the corporation. As rational and beneficial as they may think their leadership is, by mismatching styles, CEOs are likely to neutralize strategies and prevent changes necessary for successful transformations of the company. Thus, their best of intentions prove ineffectual, which no doubt is a major contributing factor to the fact that, as found by Farkas and Wetlaufer (1996), as many as 50% of CEOs are replaced within 5 years. Thus, studies and real-world experience tend to confirm the obvious: that for successful strategic leadership in today's highly competitive business climate, it is imperative that CEOs review frequently and objectively their own attitudes, activities, and interactions with their employees. Then, based on their self-assessments, they must accordingly continue or change their thinking and doing to meet both current circumstances and long-range visions.

CEOs who adopt the strategic leadership approach, and are serious about assessing bottom-to-top (and vice-versa) information and undergoing rigorous self-examination, generally choose one of five distinct styles as their predominant method of leadership (Farkas and Wetlaufer, 1996). These are:

  • The strategy approach
  • The human-assets approach
  • The expertise approach
  • The box approach
  • The change approach

The strategic approach

In the strategic approach, CEOs focus on the factors outside the corporation. They gather and analyze data to understand market conditions, economic trends, customers' purchasing habits, new competitions, and the role of substitutes. They also study their own corporations to find out their strengths and weaknesses. The CEOs in this case are very objective in finding out where the market is heading and how the corporation can be repositioned to take advantage of market movement. They are ritualistic about swot (strength, weakness, opportunity, and threat) analysis. The CEOs those who adopt such a strategy often make decisions that have significant consequences for the corporation.

The human-assets approach

In the human-assets approach, executives believe that the success of their organization depends on the way the member companies perform, i.e., interact with customers, roll out new products, and design programs to defeat competition. The executives in this case hire individuals who can act decisively, swiftly, and appropriately without direct supervision. The CEOs in this case are mainly focused on hiring. They are always looking for few good people to do the jobs that need to be done. These CEOs value employees who display predictable characteristics such as honesty, loyalty, and hard work. These CEOs usually grant powers to individuals to act freely on behalf of the company.

The expertise approach

In the expertise approach, CEOs believe that they must create specific expertise within the organization so that the organization can differentiate itself from its competitors and can maintain the leading position in the market. In day-to-day activities, expertise CEOs do not get involved in the operational details of the organization. They are focused on corporate policies that will strengthen their organizations. They value employees who demonstrate expertise and share their expertise with others. Intuitively, these CEOs are likely to be short lived for one simple reason: with changing market conditions, today's expertise may be obsolete tomorrow.

The box approach

The box approach is similar to the human-assets approach. In this case, like the human-assets approach, the CEO tries to build the organization in such a way that under any circumstances each individual in the organization will act just as the CEO would. This is achieved by enforcing standard operating procedures (SOP) and the employees are encouraged to think and act independently within the framework of the SOPs. In this strategy, the CEO's main focus is communication. The box approach could be stifling; however, it can bring clarity to everyone involved in day-to-day activities.

The change approach

In the change approach, the CEO's role is to oversee change (overhaul) in every aspect of the organization. Change CEOs believe that change is the best way to deliver consistently extraordinary results. Their idea is to improve their organization through continuous renewal. Executives and employees for different reasons, sometimes, misunderstand change. Sometimes executives tend to believe in the slogan, "change is good." This slogan has demonstrated its demerits, especially when CEOs are not educated in the field of change. Change is almost always controversial and is often met with daunting resistance. For some people it may not be easy to understand that change for the sake of change does not add value to an organization. If the change is not aligned with the underlying strategic vision, then change will bring controversy and resentment. The most challenging among the five leadership approaches is the change approach: it is the most demanding and one a leader needs to be versatile and knowledgeable enough about to still be successful. Many hi-tech CEOs follow the change approach; in this approach, the CEO must have the vision and technical excellence to guide his or her organization to meaningful changes.

Summary

In conclusion, the most valuable asset of corporate leaders is their capacity to empower others. To empower others, they must understand that there are positives in every situation. Leaders with such an orientation know the importance of attending to emotional gridlock, stepping back, and seeing from the perspective of others. When they do that, CEOs know it can produce absolutely amazing results in efficiency, self-esteem, and success while strengthening alignment to the organization's vision and mission. To empower others, the authors suggest that leaders need to be internally happy, clear and confident about the mission of the organization, and willing to allow the development of others. With these core attributes, leaders can overcome adversity, build the human capital, and simultaneously experience the joy of leading an effective organization.

The positive consequences of empowerment in leadership cannot be underestimated (Spreitzer, 1996). However, to identify leader behaviors associated with employee empowerment and human resource development, measures need to be devised that can be used in the context of leadership in the development of human capital. The comptroller General of the U.S. (2000), for example, has created just such a self-assessment designed to enable agency leaders to assess their human capital building efforts.

To effectively empower others, leaders must know and act on the belief that people are the most valuable asset of an organization. All the success of an organization depends on its people. This is not just a theory; it is a reality (Miah, 2002).

References

Comptroller General of the U.S. (2000). Human Capital: A self-assessment checklist for agency leaders. Version 1. (ERIC Document Reproduction Number ED455429).

Farkas, C. M. & Wetlaufer, S. (1996). The Ways Chief Executive Officers Lead. Harvard Business Review, 74, 110.

Julius, D. J., Baldridge, J. V., & Pfeffer, J. (1999). Determinants of Administrative Effectiveness: Why some academic leaders are more influential and effective than others. Canadian Society for the Study of Higher Education.

Leithwood, K. (1992). The Move Toward Transformational Leadership. Educational Leadership, 49(5), 8-12.

Miah, M. J. (2002). Strategic Leadership: A Strategy to Encounter Change, Presented in the GEN/480 Course Lecture, University of Phoenix, Las Vegas, NV.

Opatz, P. & Hutchinson, K. (1998). Building Trust Through Strategic Planning. Planning for Higher Education, 27 (2), 21-27.

Spreitzer, G. M. (1996). Social Structural Characteristics of Psychological Empowerment. Academy of Management Journal, 39, 483-504.

Stark, J. S., Briggs, C. L., & Rowland-Poplawski, J. (2000). Curriculum Leadership Roles of Chairs in "Continuous Planning" Departments. AIR Annual Forum Paper. (ERIC Document Reproduction Number ED445648).


Mohammed Miah is the College Chair for General and Professional Studies of the Nevada Campus, University of Phoenix. A faculty member since 1995, Mohammed has been teaching undergraduate mathematics and graduate/undergraduate business statistics, as well as directing class scheduling, monitoring class performance, managing student grievances, and consulting faculty on academic and UofP policy issues. Prior, for 10 years he was a senior scientist at Lockheed, designing surveys, using statistical models, conducting research and statistical tests, evaluating data uncertainty and data quality, and constructing models to mathematically represent the inherent behavior of processes under study. Before Lockheed, Mohammed was a consultant to the World Bank, and for the Institute of Training and Organizational Development, Graduate School of Public and International Affairs, University of Pittsburgh. Contact Mohammed at the Nevada Campus, UofP, mmiah@email.uophx.edu.

Dr. Linda K. Gaughan currently coordinates the assessment department in the School District of Hillsborough County, the nation's 11th largest. She assists nearly 200 public and charter school sites responsible for approximately 170,000 students' academic success. Her daily concerns include instructional validity, accountability, academic standards, high-stakes testing in general, and accommodations and modifications. As well, Linda serves as adjunct professor, mentor, and adviser at Nova Southeastern University in such graduate programs as School Psychology, the Graduate Teacher Education Program, and, since its inception, the doctoral program in Organizational Leadership. Contact Linda at LindaGaughan@cs.com.

Dr. Jeffrey M. Wallmann is a Practitioner Faculty member and the Campus Chair of General Studies at the Nevada Campus of the University of Phoenix. His degree is in English, specializing in Rhetoric and Composition; and for over 15 years he's been teaching writing, literature, and communication with an emphasis on Distance and Continuing Education courses, not only at UofP, but as adjunct instructor at the University of Nevada, Reno, and the University of Nevada, Las Vegas. In addition, since 1981 he has been the president/owner of Marketeer/Marketing Services International, Inc., a consulting firm for businesses seeking improvement in writing and oral communication skills; the president/owner of Student Media Institute, a campus organization for university students seeking practical experience in media and communications; and the president/owner of Distance Learning Network, a company dedicated to creating and distributing video programming of and about distance and continuing education courses. Contact Jeff at the Nevada Campus, UoP, drjmw@email.uophx.edu. or privately at drjmw@sbcglobal.net.

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Copyright 2002 by M. Miah, L. K. Gaughan & J. M. Wallmann. All rights reserved.

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