Transcript CHAPTER NINE UPPER ECHELON VIEW: STRATEGIC LEADERSHIP

CHAPTER NINE
UPPER ECHELON VIEW:
STRATEGIC LEADERSHIP
Learning Objectives
1. Differentiate between micro and
upper-echelon leadership.
2. Describe the domain and roles of strategic
leaders in the management of an
organization.
3. Identify the external and internal factors
that impact strategic leaders’ discretion.
4. List the individual characteristics of
strategic leaders and their impact on their
style.
Learning Objectives (cont’d)
5. Contrast the four strategic leadership
types and discuss the role of culture and
gender in strategic leadership.
6. Explain the processes through which
strategic leaders manage their
organization.
7. Review issues of executive
compensation and accountability.
Strategic Forces
Strategy
Culture
Structure
Technology
Leadership
Environment
ORGANIZATIONS
Differences Between Lower Level
and Upper Echelon Leaders
 Who the leader is
 Scope of responsibility
 Focus
 Effectiveness criteria
Dual Role Of Upper Echelon Leaders
Moderating
Factors
Leadership
Characteristics
Strategy
Formulation
Strategy
Implementation
Performance
External Moderators Of
Executive Discretion
 Environmental
uncertainty
 Type of industry
 Market growth
 Legal constraints
Internal Moderators Of
Executive Discretion
 Stability
 Size and structure
 Organizational culture
 Stage of organizational growth
 Presence, power, and makeup of TMT
Themes In Upper Echelon Style
Challenge Seeking
Need for Control
 Risk taking
 Delegation
 Openness to
 Centralization
change
 Willingness to
innovate
 Future orientation
 Uniformity of
practices
 Focus on process
Strategic Leadership Dimensions
High
challengeseeking
CHALLENGESEEKING
Low
challengeseeking
HIGH-CONTROL
INNOVATOR (HCI)
Challenge-seeker who
maintains tight control
over organization
PARTICIPATIVE
INNOVATOR (PI)
Challenge-seeker who
delegates control
of organization
STATUS QUO
GUARDIAN (SQG)
Challenge-averse who
maintains tight control
over organization
PROCESS
MANAGER (PM)
Challenge-averse who
delegates control
of organization
High control
Low control
NEED FOR CONTROL
Processes Leaders Use To Impact
Their Organization
Environment
LEADER
• Direct decisions
Strategy
• Allocation of resources
• Reward system
Culture
• Selection of other leaders
Structure
• Promotions
• Role-modeling
Leadership
Technology
Direct Decisions
• Vision
• Mission
• Strategy
• Structure
• Organizational culture
• Selection of other leaders
Allocation of Resources
and Reward System
• Decisions regarding funding and
budgets
• Allocation of resources to support
goals
• Formal rewards, such as salary and
bonuses
• Informal rewards such as
recognition
• Promotion of other leaders and
managers
Setting the Norms and Role
Modeling
• Setting decision criteria
and rules by which
others make decisions
• Active or subtle role
modeling of behaviors
and styles
Responsibility Of Upper Echelon
Leaders
 Organizational performance
 Accountability to various
internal and external
constituents
 Ethical behavior and rolemodeling
Factors that Affect Executive
Salaries
 Firm size
 Industry competition
 C.E.O. power and discretion
 Internationalization
 High stress and instability
Leading Change:
Sari Baldauf of Nokia
• Extensive experience in the industry
• Recognizes need for flexibility and
change
• Focus on using teams
• Partnerships with universities
Leadership In Action:
Fernando Capellàn
 President of largest private employer in
Dominican Republic
 Focus on employees and community first
and profit second
 Extensive programs to educate and
support employees and their families
 Participation from employees
The Leadership Challenge
• C.E.O. involvement in nomination of board
members helps assure that members with the
right skills and expertise are selected
• Those nominated by C.E.O. may have a conflict
of interest and a positive bias towards the
C.E.O.
• Creation of a balance of members nominated
by different stakeholders is essential