Management

The relationship between Strategic Management and Leadership

  • August 26, 2018

Strategic Management can be explained as a set of managerial decisions and actions that controls the long-term performance of an organisation. Strategic Management performs in an organisation as to its mission statement and creates methodologies to gain goals through the appropriate utilisation of its resources.

The organisations that apply Strategic Management in their decision-making process are higher performing organisations than those who do not apply.

Strategic Management leads to a competitive advantage for an organisation as it helps the organisation to spot its goals and the methodologies to achieve the goals. Strategic management helps organisations to anticipate the changes and build strategic methodologies in step with the dynamical environment and market demands. Strategic management involves long-running organisational planning that concentrates on its goals and objectives. In the long-running plan, the organisation cannot take intuitive decisions; thus, Strategic management could be a logical manner of decision making that becomes a competitive edge for an organisation. It helps organisations to spot the threats from the environment and then developing strategical methodologies to convert those threats into opportunities.

Strategic Management defines the organisation’s vision and mission statement that guides the staff regarding the long-term organisation strategies and plans for every business unit. It then makes all the business units to achieve the mission of its organisation. The execution of any strategy completes whereas keeping in mind the present market setting, competitors as well as the business resources. The quick the company observes the dynamic demand pattern of customers and consequently build strategic decisions to cater to those changing demands can lead the organisation towards profit maximisation and improve growth prospects. To improve these developed strategies more active, they are then evaluated to make changes if necessary.

Strategic Management balance out the organisation’s resources and the dynamic demands of customers by creating strategies which will be profitable for the business unit itself likewise it can satisfy the dynamic demands of its customers.

Leadership is the ability to make decisions and inspire others to perform well to achieve a challenging goal. Many effective leaders always take decisive actions to outperform their competition and persist in the face of failure. To make it more simplify leadership provides the vision and the direction for the growth as well as the success of an organisation.

In the past, Leadership was considered a natural human characteristic and concentrated only on the leaders. Unlike in the past, currently, Leadership is not concentrated on the leaders alone, however on the workforce and followers as well. Luthan and Avolio came up with the conception of authentic leadership which suggests that the leader ought to encourage his/her workforce by considering their opinions in the decision-making process. The leader can influence his/her workforce to improve their performance so that they can accomplish the organisation’s goals and objectives.

Developing leadership at each level of the organisation helps to sustain its semi-permanent success. The organisation ought to develop leadership skills in their staff through appropriate training programmes and guide them the way to use those leadership skills in several situations.

An active leader is the one who is a practical influencer and a role model for the staff so that the staff can trust them blindly. The leader increases the morale of his/her staff, increase their self-esteem, confidence about themselves by letting them join in the decision-making process which ends up in more committed staff and ensures the success of the organisation. A good leader uses a leadership style which suits best in the situation.

The characteristics of leadership assume the importance during this age of cut-throat competition as effective leadership paves the approach by which an organisation achieves its varied objectives. In this regard, the roles of a leader are vital as they look to exhort the employees to improve their participation in the management and practical evaluation of strategies or methodologies concerning the organisational goals.

Leadership is the bridge between strategic management and its target. It is because of the leadership that the organisation gets their desired tasks and targets. Management is responsible for people and resources in a unit according to rules or values that have already been set while the leadership set a direction to the people in the group.

Excellent leadership and effective management are the success in any organisation. Both are the skills which performing side by side. Without active management, ethical leadership cannot achieve long-term goals.

The tasks of management are usually planning, organising, controlling while giving incentives and taking corrective actions and produce solutions to problems while the tasks of leadership are creating a vision, explain the big picture, setting up goals and motivate, energise and inspire people. As per Bennis and Zaleznik, leadership is presuming the acceptance of a set of values where management is not, leadership strains in performing the correct things whereas management believes in performing things correctly.

For the success of organisation leadership and management are vital. Both leadership and management are seen to have likenesses. As an example, both involve working with others and have goals or objectives that must be achieved. At times these two roles overlap, and sometimes these two roles are symbolised in one person.

However, there are often separate people in organisations explicitly fulfilling these roles, and there are apparent differences between the two.

Leadership and management are two overlapping functions

Leadership and management are two overlapping functions.

Management and leadership complement one another and an individual who may be a manager ought to be a leader committed to the buyers, employees, suppliers and the community.

In order to remain ahead in these competitive surroundings, it is vital for any organisation to require necessary steps to face each domestic and foreign competition effectively. Organisations ought to focus on an international framework for strategic planning, promoting, and operations. Recent development in varied aspects such as global marketing, communications, finance and management, resources planning and development have improved the potential of organisations to perform globally in these aggressive surroundings. In order to sustain in this environment, every organisation must need to have a proper global vision and understanding of different cultures, customs and ways whereby they to perform and also, they should have a clear understanding on the regulatory, legal and aspects of nations in which they will operate their organisation.

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