Understanding the role of leadership in shaping business strategies

Everyone in business knows that a solid business strategy is essential for an organisation’s success, and most people understand that a strategy requires a few key ingredients – a vision, certainly, as well as a thorough understanding of the business’s strengths, weaknesses, opportunities, and threats, to name a few.

But when considering the creation of a new business strategy, the most important aspect isn’t about ‘what’ or ‘how’ or even ‘why’ – it’s about who is shaping the document: Who is influencing the strategy? Who is embedding it? And who is ultimately responsible for its success?

The answer, of course, is the organisation’s leadership.

Business strategies: the basics

Business strategies are comprehensive plans that are designed to achieve specific business goals and objectives. A key area of strategic management, they are the blueprint for guiding a company’s direction, its decisions, and the allocations of its resources:

• In an ever-changing business environment, strategies provide the framework for organisations to adapt and thrive. 
• With a good strategy in place, businesses can better anticipate market trends, address customer needs, efficiently manage resources, and ultimately, maintain a competitive edge.
• The strategy should align the company’s operations with its vision, and outline measurable goals that contribute to the organisation’s long-term profitability and growth.

The stages of a business strategy

There are three key stages within a business strategy’s lifecycle, and strategic business leaders – particularly transformational leaders – play a pivotal role in all three.

Developing the strategy

Strategic leaders do a lot of heavy lifting during the development stage of a business strategy. They’ll leverage their vision, their knowledge, and their experience to identify opportunities and threats within the business landscape, and set a clear direction for the future.

Effective leaders will also engage other stakeholders and colleagues in the strategic planning process early on, ensuring that objectives are aligned with organisational values and competencies, but also that the rest of the business is invested in the strategy from the start. 

Implementing the strategy

To successfully embed a strategy, leadership teams need to set an example. The first step is sharing the vision, but this is followed by leaders mobilising their teams and acting as a driving force for strategic initiatives to ensure that everyone can see the strategy in action.

At this stage, it’s important that leaders effectively and actively communicate with team members across the organisation so that everyone understands their roles and are equipped with the necessary information and resources to execute the plan. 

During this stage, transformational leaders will also work to create an empowering work environment, one that encourages and inspires employee engagement and a commitment to the company’s goals.

Evaluating the strategy

The work doesn’t end once a strategy has been launched and embedded – it needs to be continually monitored and evaluated, and leaders play a crucial role in this process. They agree on the metrics and benchmarks that are used to measure the success of the strategy, and this means that the organisation can assess its performance and make any necessary adjustments based on the results.

Transformational leaders will also foster a culture of feedback and accountability within the organisation, ensuring that team members can share insights and challenges openly, whether this is with management directly or through human resources channels. This process aids assessment of the current strategy’s effectiveness, but it also informs future strategic planning.

The importance of organisational culture in executing business strategies

The importance of leadership in shaping business strategies is clear, but leaders also have an important role to play in strengthening their organisational culture – the values, beliefs, and behaviours that characterise how work is done within an organisation. This is the foundation upon which business strategies are executed.

How leaders help shape organisational culture and behaviour

Leaders influence company culture through their actions, their communications, and their decision-making processes. By embodying the organisational values of the business, they set the tone for behaviour and expectations within the company.

The best leaders – the ones who go for a transformational leadership approach, rather than simply a transactional leadership style – will go even further and promote an open culture of empowerment, adaptability, and continuous improvement. These leaders recognise the importance of employee well-being and engagement, creating a positive work environment that motivates team members to contribute their best. And this alignment between leadership, culture, and strategy elevates the organisation’s ability to execute its business strategy and meet its strategic objectives.

Tips for developing transformational strategic leadership skills

It’s clear that transformational strategic leadership skills can help with the shaping, embedding, and assessing of business strategies, and while some leaders are naturally gifted in this area, the skills can also be learned. For example, leaders can:

• Embrace continuous learning. Make a point of keeping on top of industry trends and advancements as well as debates in leadership and strategic management. With a growth mindset, leaders are better able to tackle challenges and changes with both insight and foresight.
• Champion adaptability. Being flexible in thinking and decision-making means that leaders are better able to navigate the uncertainties and innovations of the business environment. It’s easier said than done, but try to embrace change by seeing it as an opportunity for growth.
• Never stop working on effective communication. Clear, concise, and open communication builds trust and clarifies expectations. Even if you’re confident in your communication skills, keep working on them.
• Practice fostering empowerment. Encourage autonomy and initiative among team members. Empowerment boosts morale, creativity, and ownership, all of which are often essential for successfully executing strategies. An empowered employee base is also likely to improve recruitment and retention rates, with more people wanting to join the organisation and more employees who want to stay on.
• Invest in leadership development. Participate in leadership development programmes and training. These can provide valuable insights into effective leadership practices and offer strategies for creating a more supportive and high-performing organisational culture.

Take your leadership skills to the next level

Forge your future in leadership with the 100% online MBA Leadership from Lincoln International Business School at the University of Lincoln. This flexible MBA is ideally suited to:

• individuals currently in or aspiring to management and leadership roles.
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You’ll develop skills in areas such as leading and developing people, workforce planning, strategic decision-making, stakeholder management, and change management.