While the context of “strategy” may cause you to immediately think of strategy maps, SWOT analysis, strategic workshops etc., this article is designed to broaden your mind on what it means to be a strategic leader. The challenge here is that being a strategic leader is as much a question of mind-set as it is a question of techniques and skill. It is about thinking and acting strategically every day. Does that mean it can be developed? Yes, but it is not necessarily easy.
In 2013, Management Research Group (MRG) completed a large scale global study addressing this question. They evaluated the leadership practices and effectiveness of 60,000 managers and executives in 140+ countries and over 26 industries. MRG found that a strategic approach to leadership was, on average, ten times more important to the perception of effectiveness than other behaviours. It was twice as important as communication (the second most important behaviour) and almost 50 times more important than hands-on tactical behaviours. In their study, the leaders who scored well on those strategic skills were six times more likely to be seen as effective as the leaders that were low on them, independent of any of their other behaviours. They were also four times more likely to be seen as individuals with significant future potential within their organizations.
Thinking and acting in a strategic context
Inspired by research from organizations such as MRG, and our work with various global corporations on developing more strategic leaders, we have created a framework to develop strategic leaders that we call the "Leadership Cube". It supports managers in their development of strategic acumen by framing their daily work in a strategic context – simply and efficiently. It allows them to observe their entire working environment through the lens of strategy and encourages them to do this in cooperation with their team. By making them more strategic, it makes them more effective in the eyes of others and seen as individuals with significant future potential.
The following is a brief description of the way the Leadership Cube works.
The cube starts out by exploring who you are as a person and a LEADER. Through this perspective you analyse the talents you bring to the table along with your desires, values and fears. It allows you to be strategic about the use of your true strengths, such as how you use them to compensate for your weaknesses. Once you have a deeper understanding of yourself and the talents you bring to the game, you start asking yourself where you are headed and why. This second perspective of the Cube deals with what is your VISION and the deeper purpose that drives this vision. Once you know your answers, these questions are easily adapted to your team as well as to the organization you work for as a whole. By answering them, this perspective of the Cube allows you to be strategic about aligning the visions of all key stakeholders in your environment to where the organization is headed.
Now that you understand yourself and where you and your team are headed, this third perspective is about understanding and connecting with each team member, designing an agreement on how to work together as a TEAM and supporting each team members on their individual growth path. This perspective allows you to be strategic about the people you pick for your team and/or about who you pair together for projects or even who you promote. In reality this perceptive is often viewed during or after the next perspective on strategy. Ideally though, we have had time to recruit, connect to and develop our team for some time before engaging in a strategy process with them.
After laying the foundation of self-awareness, alignment of visions and purpose and team building, we finally get to STRATEGY. The reason is that in order for strategy to be well thought out and executed with unwavering commitment, it needs to be a team effort – one with a shared vision and purpose. The strategy design phase as well as the execution phase are not only a leadership test, but a test of the team’s true functionality. This perspective thus allows you to be strategic about re-visiting your own effectiveness as a leader, the validity of the vision and purpose that the strategy should achieve as well as the team’s composition and functionality. In short, you become strategic about the level to which the previous elements support your business strategy.
An all too common mistake in leadership is to allow organizational STRUCTURE to be adjusted to accommodate the perceived needs and/or desires of individuals. The challenge here is to keep the structure purely focused on supporting the execution of the business strategy, so that the vision can be achieved. But not only structure needs to be designed to support strategy. Processes play a key role, too. Just imagine an organization that wants to be faster and more agile globally, while all decision-making processes depend on approval from central functions located in the headquarters and far away from the action. This perspective allows you to be strategic about designing solid structure and processes that can be seen as the scaffolding that enables you and your people to build a tall and beautiful building.
Last but not least strategic leaders keep a close eye on all relevant measuring criteria. When we say relevant we of course mean strategically relevant. This means that a suite of selected KEY PERFORMANCE INDICATORS that measure progress in strategy execution are prioritized above more stand-alone and/or short term KPIs. An example is: An organization with the strategic goal of increasing the actual number of customers in a certain industry, does not accept an overall EBITDA target achievement that was achieved through a contract with a single large customer. The number of customers had equal or even more importance than the financial target. This KPI perspective allows you to be strategic about the selection, portrayal and discussion of KPIs that really matter for the strategic success of your organization.
Finally a strategic leader – or as we call it: a cube leader – takes a look at themselves, the vision, the team, the strategy, the structure and processes and key performance indicators from various time perspectives, i.e. short, medium and long term. Being an alert and aware cube leader creates various opportunities to discuss these time perspectives with relevant stakeholders in order to optimize ways of working. Staying in a strategic context at all times also allows the anticipation of changes in the market and the interpretation of what those changes mean to the organization, challenge the organization to find ways to stay a step ahead of the market. Armes with this information, a cube leader then challenges the organization to find ways to maintain competitive advantage.
In simple terms: Keeping the six perspectives of the Leadership Cube in mind in your every day leadership work makes you a more strategic leader.