11. Strategic Leadership

Question 1

What does strategic leadership entail?

Answer 1

Empowering others to create strategic change.

Managing through others.

Question 2

Factors affecting top-level managers decision making are:

Answer 2

1) Environmental changes
2) Organisation characteristics
3) Manager’s characteristics

Question 3

1) What does a top-management team entail?

2) What is required?

Answer 3

1) Key managers that pick and implement strategy.

2)
- general knowledge of firm’s operations
- knowledge of external environment (general, industry, competitor)

Question 4

Is it better to have a homogeneous or heterogeneous team?

Answer 4

Heterogeneous

Question 5

1) What is the board of directors?
2) What do they represent?
3) How do they influence firm performance?

Answer 5

1) Governance mechanism
2) Stakeholders interests
3) Higher performance when directors are directly involved with strategy.

Question 6

What are the two types of managerial succession?

Answer 6

Internal managerial labor market: opportunities for managerial positions and qualified employees WITHIN firm

External managerial labor market: managerial career opportunities and qualified people EXTERNAL of firm

Question 7

What is a benefit of an outsider CEO?

Answer 7

More innovative ideas.

Question 8

What does strategic direction do?

Answer 8

Specifies image firm seeks over time.

Question 9

Define human capital.

Answer 9

Workforce’s knowledge and skills.

Employees are capital resource requiring investment.

Question 10

Define social capital.

Answer 10

Relationships inside and outside firms to complete tasks and create value.

Question 11

What is organisational culture? Is it difficult to change?

Answer 11

Complex beliefs.

Difficult to change so more incremental changes.

Question 12

What is the central task of strategic leaders?

Answer 12

Shaping organisational culture (context).

Question 13

What are the five types of entrepreneurial mindsets in organisational culture? What do they entail?

Answer 13

Autonomy: employees act without constraints (self-directed)

Innovatedness: employees think beyond existing knowledge/technologies

Risk Taking: accepting risks when pursuing entrepreneurial activities

Proactiveness: ability to be a market leader (not follower)

Competitive Aggressiveness: actions allowing firms to outperform rivals

Question 14

What type of firms have more effective strategy implementation?

Answer 14

Ethical firms

Question 15

What does ethical organisational culture require?

Answer 15

1) Code of conduct (ethical goals)
2) Updating code (from employee and other stakeholder input)
3) informing all stakeholders of the code
4) methods to achieve ethical goals (e.g. auditing)
5) reward systems
6) healthy work environment

Question 16

1) What does the Balance Scorecard do?

2) What is it most effective for?

Answer 16

1) Assesses if firms established strategic and financial controls.
2) Best for business level strategy (can be used for corporate though)

Question 17

What are the four parts of the balanced scoreboard?

Answer 17

Financial: growth, profitability and risk from SHAREHOLDER’s perspective

Customer: value from products

Internal business processes: business processes that satisfy customers and shareholders

Learning & growth: creating a workplace that supports change, innovation + growth