It seems uncontroversial to say that a company’s leadership team is responsible for formulating and executing its Strategy – that is, how the company intends to advance toward its mission. But many leadership teams under-utilize their strategy to enhance their leadership capabilities and followership. There is potential for a powerful synergy between Strategy and Leadership, but it is not automatic and requires intentional effort as leadership teams and businesses grow.
Strategy provides much of the substance of leadership. Explicitly or implicitly, strategy includes core strategic concepts such as:
- Value proposition, brand positioning, and differentiation
- Organizational values and culture
- Enterprise-level performance, goal setting, and incentivization
- Context setting and forward-looking change initiatives
Especially as leadership teams grow and evolve in terms of new roles and leaders coming from outside the organization, the exercise of packaging and publishing the business strategy becomes a tremendous leadership opportunity and, just as importantly, a declaration of unity in the voice of leadership. Yes, there will be differences in style among the leadership team. These differences should be celebrated and appreciated. But the core leadership messages, rooted in strategy, should be consistent and persistent.
In this way, strategy forms the basis for Quarterly Business Reviews with management; for town hall meetings and other enterprise-wide leadership communications; for cascading information into functional areas and middle management; and for defining goals and managing performance throughout the organization. And, of course, for collaborating with the Board of Directors. Altogether, it has the potential to form a tightly integrated, highly effective system of engagement with all stakeholders.
So why doesn’t it happen? There are several places where strategy can get disconnected from leadership.
- There is no current, formal expression of strategy – the most important people “get it” and everyone else can follow along as best they can. Strategy is apparently disconnected from day-to-day operations.
- The business strategy is a technical document to be hidden from as many people as possible, so it is not compromised in any way.
- There is no singular, consistent messaging across the leadership team, so they are left to advance their own interests and often send conflicting messages within the business.
- Goal-setting and performance management are based on factors that are at best indirectly connected to strategy.
I am not suggesting that leaders simply publish the “core strategy” within an organization. There are always sensitivities to be managed and risks of leaks to the competition, etc. Indeed, the “core strategy” documentation may be seen by a small circle of leaders. However, the core strategy can be refined into a leadership communications initiative that accelerates the company’s progress toward its next set of major milestones. That is when strategy becomes leadership.
A few weeks ago I wrote that “Strategy Informs; Narrative Engages. Leaders Need Both.” The intentional and ongoing engagement of stakeholders based on the strategy elevates strategists into leaders and increases followership within organizations. This investment by leaders brings returns in the form of greater unity of purpose, improved understanding of context, and better decisions in the fray of daily execution — all accelerating the business towards its medium-term goals and aligned with its mission.
How would you describe the relationship between Strategy and Leadership in your business?
Strategy, Creativity, and Leadership 