Strategic Leadership:

Creating a Learning Organization and an Ethical Organization

Chapter Eleven

McGraw-Hill/Irwin

Copyright 2010 by The McGraw-Hill Companies, Inc. All rights reserved.

Three Interdependent Activities of Leadership

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Setting a Direction
Scan environment to develop
Knowledge of all stakeholders Knowledge of salient environmental trends and events

Integrate that knowledge into a vision of what the organization could become

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Designing the Organization

Designing the organization
A strategic leadership activity of building structures, teams, systems, and organizational processes that facilitate the implementation of the leaders vision and strategies.

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Designing the Organization

Difficulties in implementing the leaders vision and strategies
Lack of understanding of responsibility and accountability among managers Reward systems that do not motivate individuals and groups toward desired organizational goals Inadequate or inappropriate budgeting and control systems Insufficient mechanisms to coordinate and integrate activities across the organization

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Nurturing an Excellent and Ethical Culture

Excellent and ethical organizational culture
an organizational culture focused on core competencies and high ethical standards

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Overcoming Barriers to Change

Reasons why organizations are prone to inertia and slow to change
Vested interests in the status quo Systemic barriers Behavioral barriers Political barriers Personal time constraints

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The Effective Use of Power

Power
a leaders ability to get things done in a way he or she wants them to be done.

Organizational bases of power

A formal management position that is the basis of a leaders power.

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Inspiring and Motivating People with a Mission or Purpose

A Learning environment involves:
Organization-wide commitment to change An action orientation Applicable tools and methods Guiding philosophy Inspired and motivated people with a purpose

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QUESTION
The "top down" perspective of empowerment A. Encourages intelligent risk-taking B. Trusts people to perform C. Encourages cooperative behavior D. Delegates responsibility

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Empowering Employees at All Levels

Top-down perspective
Start at the top. Clarify the organizations mission, vision, and values. Clearly specify the tasks, roles, and rewards for employees. Delegate responsibility. Hold people accountable for results.

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Empowering Employees at All Levels

Bottom-up View
Start at the bottom by understanding needs of employees Teach employees skills of self-management Build teams to encourage cooperative behavior Encourage intelligent risk taking Trust people to perform

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Challenging the Status Quo and Enabling Creativity

Create a sense of urgency Establish a culture of dissent Foster a culture that encourages risk taking Cultivate culture of experimentation and curiosity

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Best Practices: Learning from Failures

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Creating An Ethical Organization

Ethical orientation
the practices that firms use to promote an ethical business culture, Includes ethical role models, corporate credos and codes of conduct, ethically-based reward and evaluation systems, and consistently enforced ethical policies and procedures.

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Creating An Ethical Organization

Ethical values
Shape the search for opportunities Shape the design organizational systems Shape the decision-making process used by individuals and groups Provide a common frame of reference that serves as a unifying force

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Integrity-Based versus ComplianceBased Approaches

Compliance-based ethics programs
programs for building ethical organizations that have the goal of preventing, detecting, and punishing legal violations.

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Integrity-Based versus ComplianceBased Approaches

Integrity-based ethics programs
programs for building ethical organizations that combine a concern for law with an emphasis on managerial responsibility for ethical behavior,

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Integrity-based Ethics Programs

Integrity-based Ethics Programs include: 1. enabling ethical conduct; 2. examining the organizations and members core guiding values, thoughts, and actions; and 3. defining the responsibilities and aspirations that constitute an organizations ethical compass.
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Key Elements of Highly Ethical Organizations

Role models Corporate credos and codes of conduct Reward and evaluation systems Policies and procedures

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