What Makes a Leader Strategic?
Aaron K. Olson and B. Keith Simerson, Authors, Leading with Strategic Thinking
Disruptive forces are sweeping through nearly every industry, placing heightened importance on both strategy and leadership. Strategy is critical to ensure that businesses navigate a changing competitive landscape. Leadership is necessary to rally teams and seize these opportunities.
We have devoted our careers to the intersection of strategy and leadership. We summarize this experience and a new research study in our recently published book Leading with Strategic Thinking (Wiley, 2015).
What “Being Strategic” Means
Strategy consists of three core activities: recognizing patterns, making decisions and managing risk. To do these activities well requires strategic thinking. From our experience, three disciplines can help leaders think more strategically:
- Cognitive psychology – helps uncover biases and blind spots which might limit us and help us ask questions likely to improve our understanding of the world around us.
- Systems thinking – helps us recognize connections, sensitizing us to how a change in one area might impact other interconnected areas.
- Game theory – sensitizes us to the reality that our decisions and actions rarely occur in isolation; actions typically impact others and their reaction is seldom neutral…their response may in turn impact us.
Leaders who think and act strategically are also highly self-aware. They consider both what their strategy is and how they choose to drive that strategy. This involves reflecting on two important questions:
- Where will our strategy come from? In short, will it be “Planned” – focused on a set course and determined through a well defined process — or “Emergent” – focused on unfolding and evolving discovery through less structured process?
- How will we drive strategic change? In essence, will our influence be “Directive” – top/down and rather unidirectional – or “Participative” – involving the contribution of others invited to participate meaningfully in decision making?
By reflecting on these questions, a leader can be more effective in applying one of four distinct types of strategic leadership:
- Visionary Leadership involves driving strategy through personal vision. Visionary leaders consider strategy formation to be emergent by design and they then drive change based on their personal experience and evolving vision of the future.
- Directive Leadership involves driving strategy through structure and process. Directive leaders define strategy using a well structured process and they drive change in a top-down manner.
- Incubating Leadership involves driving strategy by empowering others. Incubating leaders focus on enabling other leaders to both define and drive strategy, providing support and backing ideas that demonstrate potential.
- Collaborative Leadership involves driving strategy through co-creation. Collaborative leaders define and execute strategy in a structured manner but they involve others in decision making rather than driving strategy themselves.
These four types of strategic leadership represent very different ways to lead. The best leaders apply the right approach at the right time.
Becoming More “Strategic”
To understand what strategic leaders do, we examined over 300 individuals from around the world. From that study we identified best practices specific to each type of leadership:
To apply Visionary Leadership, consider how the founders of Indiegogo disrupted the financial industry by creating the industry’s first crowdfunding platform. To drive change they had to monitor trends, develop insight, design a solution, refine that solution, and enroll others into supporting their vision.
To apply Directive Leadership, consider the CIO of P&G in Latin America who transformed IT following the merger of P&G and Gillette. He lead through a focus on seting direction, establishing governance, and creating an environment to motivate his colleagues. He also monitored performance and intervened when it was necessary to make adjustments.
To apply Incubating Leadership, you follow the example of the founder of Design for America whose challenge was to empower students to solve real world problems using design thinking. She lead her students by building her network, assessing opportunities she could invest in, diversifying her bets on a wide range of students, lending resources to meet their needs, and creating support ecosystems that helped them succeed.
To apply Collaborative Leadership, consider the engineer we identified at Google who lead a movement to help users gain greater control of their own data across all Google products. To make this change happen he invested time and energy to build relationships, he listened to the input of others, he built on mutual interests, he shared power, and he demonstrated trust.
Choose the type of leadership that is most appropriate to your situation. You can do this by understanding the context that you operate within, the expectations and responsibilities of your role, and the ultimate goal that you are trying to achieve.
[Image courtesy of Stuart Miles at FreeDigitalPhotos.net]
About the Author
Aaron K. Olson is Chief Talent Officer at Aon plc, a global firm specializing in risk management and human resources. He is the co-author of the book Leading with Strategic Thinking and teaches graduate courses in the MSLOC program at Northwestern University.
B. Keith Simerson, Ed.D. provides consultation, executive coaching and leadership development in the areas of strategy formulation and execution. He is the co-author of Leading with Strategic Thinking and four additional books including Strategic Planning: A Practical Guide. He teaches graduate courses in the MSLOC program at Northwestern University.