Strategic Leadership

The management of an enterprise includes a team of managers, that is, people who manage the work of others within an established structure of employee teams, and they take the responsibility also for the work performed by other people and not by them personally. The management in enterprises is diverse not only in terms of the quality of resources they carry but also in terms of the position held in the organization or the management level. Top management, which includes CEOs, presidents, vice presidents, and members of management boards in capital groups of owners in smaller organizations, is responsible for strategic choices. Further deliberations and studies will focus on this group of managers, in line with the upper echelon trend (Hambrick & Mason, 1984; Hambrick, 2007). Top managers determine the strategic objectives of the company and are responsible for achieving them. At this point it should be stressed that these objectives are often set in agreement with lower level managers or emerge as a result of experimentation and undertaking activities at lower management level, especially with an emergent approach to strategy.

Strategic management staff have many tasks. They include primarily the following: establishing a strategic direction of the company in order to drive commitment, making strategic choices, managing a resource portfolio, managing and leading organizational culture that supports the enterprise’s strategy, promoting ethical behaviors, building balanced control systems, establishing an organizational structure, leading the process of strategy implementation, and organization performance management (Dyduch &C Bratnicki, 2017). Therefore, top managers play specific roles. It is indicated that they should be visionaries, promote change and propagate novelties, but they should be new-generation managers, who initiate the process of changing the organization’s boundaries (Cyfert, 2013) and operating in new conditions oriented at flexibility, adhocracy, and heterarchy (Lachiewicz, 2013) or handling strategic paradoxes (De Wit & Meyer, 2010).

The selection and implementation of the ambidextrous strategy, based on the exploration and exploitation paradox, therefore requires from top management particular abilities, which will help them reconcile the conflict of these actions and perform the function of ambidextrous managers. Mom, Van den Bosch, and Volberda (2009) indicate three key characteristics in this respect. First, ambidextrous managers must manage conflicts, which means that they are motivated and able to understand and implement a series of opportunities, needs, and objectives that are seemingly conflicting, which requires paradoxical thinking. Second, ambidextrous managers are multi-taskers, which means that they perform various roles and implement various tasks in a specific time limit. They are to a greater extent generalists rather than specialists, which requires from them both creativity and routine activities. Third, ambidextrous managers must excel and refresh their competences, which are related to the need to acquire new skills and knowledge and to use the current skills and knowledge, based on up-to-date and constantly expanded experience. In the meantime, they engage in a learning process, exploring and exploiting their explicit and implicit knowledge (Lubatkin et ah, 2006) and searching for information in contact networks (Subramaniam & Youndt, 2005). Chang and Hughes (2012) draw attention to risk-taking ability and adaptability as key skills of ambidextrous managers in organizations. They argue that if top managers demonstrate an inclination to take risks and accept the costs of potential failures, then the employees will be more prone to propose and introduce new products in response to emerging market opportunities. On the other hand, if top management manifests risk aversion, then employees will be less oriented toward innovation and more concentrated on improvement of existing products and boosting performance and efficiency of processes. Similarly, high adaptability of top management to new circumstances in the context of the current operations and activities of the company induces the same need in employees. Therefore, managers who often stress the importance of adaptability to market trends, responsiveness to actions of competitors, and the need to act now to meet the needs of customers in future, may count on ambidextrous behaviors of their employees. In other words, the capacity of top managers to engage in both types of activities informs employees which actions are desired in an organization. Probst, Raisch, and Tush- man (2011) reached similar conclusions, indicating that top managers must be able to achieve short-term goals while simultaneously engaging in refreshing products or processes in the company that demonstrate the exploration of their activities.

The capacity of management to demonstrate ambidextrous behaviors and attitudes is directly connected with leadership ambidexterity. However, it should stress that in the literature on the topic, leadership has a number of definitions. In a general approach, leadership means making an impact on others without applying coercive measures (Northouse, 2018). They may be connected with the leader, perceived through the results and outcomes of activities, referred to an official position, treated as a process (Kouzes & Posner, 2006), or taken into account from the microfoundations perspective (Piorkowska, 2017). Particular significance is attributed to strategic leadership understood as leading the entire organization, taking into consideration its evolution, changing objectives, and dynamic relations with the environment; its essence being the ability to predict, visionary imagination, maintaining flexibility, and positive support of others to build strategic change (Davies & Davies, 2004; Samimi et ah, 2020).

Strategic leadership is close to transformational leadership, which is juxtaposed with transactional leadership (Bass, 1985). The first is based on a vision that takes into consideration the interests of the members of organizations, stimulates the learning process, and inspires new ways of thinking, driving people to achieve more in their pursuit of high efficiency (Bass & Riggio, 2006). The latter, on the other hand, pertains to everyday, routine duties performed by the leader, consisting of managing the efforts of other through tasks, rewards, and structures (McCleskey, 2014). Transactional leaders concentrate on day-to-day operation and profit, and change the world so that it better fits their values and ideas; on the other hand, transformational leaders operate in a manner that is charismatic, inspiring, and intellectually stimulating for individual employees (Judge & Piccolo, 2004). Therefore, ambidextrous leaders should concentrate on transformational leadership, but they should also use elements of transactional leadership.

This stream of research is quite widespread in the literature, and the leadership processes were studied, on the one hand, as an independence antecedent to the concept of ambidexterity (Lubatkin et al., 2006), and on the other hand, as a variable moderating the ambidexterity of an organization (Smith & Tushman, 2005). It was proven, inter alia, that transformational leadership is closely connected with exploration of innovation, whereas transactional leadership with exploitation of innovation (Jansen, Vera, & Crossan, 2009). However, transformational leadership is closer to the idea of ambidexterity because it stimulates not only exploration, but as research has proven, also exploitation (Nemanich & Vera, 2009) and helps reconcile conflicting objectives, in particular at group level (Jansen et al., 2008). Sarros, Cooper, and Santora (2008) explain that, besides promoting creativity and changes related to exploration, transformational leaders also define high expectations and provide their subordinates with a clear plan for the future. Meeting clearly defined expectations and following an established plan should be regarded as a dimension of exploitation. Similarly, Keller and Weibler (2015), based on the study of 179 managers in German companies from various industries, demonstrated that transformational leadership helps balance between exploration and exploitation and also helps balance these activities in an enterprise. In addition, researchers have shown that the ambidexterity level of managers depends on their cognitive effort, and this dependence is moderated by the level of their diligence and scrupulousness and openness to new experiences. On the other hand, Li, Lin, and Tien (2015), assuming the perspective of strategic leadership and conducting research on a sample of 388 top managers from 88 small- and medium-sized manufacturing enterprises from Taiwan, demonstrated a positive relationship between transformational leadership and ambidexterity of top management staff, and they defined the key elements of this leadership, which include senior team behavioral integration, decentralization of responsibilities, longterm compensation, and individual manager risk propensity.

The study of the link between leadership and ambidexterity was also subject to meta-analysis. Rosing, Frese, and Bausch (2011), in their meta-analysis covering 77 articles published between 1992 and 2009 in leading English-language journals, confirmed that this relationship is characterized by high heterogeneity. The meta-analytical integration of results demonstrated positive and weighted mean correlations for the following leadership styles: transformational leadership, initiating structure leadership, LMX (Leader-Member-Exchange), and supervisor support, which is not a specific style but a set of leader behaviors supporting ambidextrous behaviors of subordinates. However, researchers indicate that most correlations are at a low or moderate level, and in some cases the same leadership behavior did not demonstrate correlation with innovation, and sometimes it was even negative. Therefore, they concluded that there are many various paths for leadership, leading to the same effects, and leadership behaviors may have a wide scope of possible consequences, depending on moderating variables. Based on the obtained results, the researchers proposed an ambidextrous leadership style, focused on open behaviors of leaders, which stimulates exploration; closed behaviors of leaders stimulating exploitation and executive flexibility allowing the balance between them. Open behaviors include leadership attitudes and behaviors that encourage subordinates to experiment and complete tasks using various methods, motivate them to take risks and allow them to make mistakes, treating them as a training ground, as well as create opportunities for independent thinking and action, while propagating values of openness and tolerance (Rosing, Frese, & Bausch, 2011). On the other hand, closed leadership behaviors include the establishment of task completion procedures, undertaking corrective measures based on control of adherence to rules and procedures, and monitoring the achievement of established goals through sanctioning mistakes and propagating high performance and efficiency (Rosing, Frese, &C Bausch, 2011). Both types of behaviors are necessary for effective implementation of the ambiguity strategy, and at the same time the higher the interaction between them (i.e., the higher the level of both open and closed behaviors), the more ambidexterity the leadership demonstrates. Studies of 33 team managers and 90 employees from 27 Australian architectural firms and six enterprises dealing with interior design confirm that a high level of open interactions and closed leadership behaviors contributes to high innovation of the team (Zacher & Rosing, 2015).

Other research raising the leadership problem in the context of ambidexterity (e.g., Carmeli & Halevi, 2009; Alexiev et al., 2010; O’Reilly & Tushman, 2011) concentrated on the identification of individual management practices determining the success of exploration and exploitation activities. For instance, Havermans et al. (2015) identified the practices of achieving ambidexterity by managers in the context of dynamics of management efforts aimed at achieving high exploration and exploitation levels at the same time. Based on the analysis of two case studies of design organizations, they noticed that these practices may be divided into two groups: (1) reflecting the complexity of beliefs (e.g., building commitment, stimulation of discussion, encouraging to go beyond borders, availability to subordinates and listening to them, which are dedicated to exploration; and caution, absence of discussion or keeping to agreements, which stimulate exploitation) and (2) reflecting the complexity of activities (e.g., freedom, team work and acceptance of mistakes for exploration and specific decisions, rules and meeting of requirements assured for exploitation). Concurrently, researchers stressed the role of human resources management specialists who, through coaching, mentoring, training, career path building, etc., may create an adequate context for ambidextrous leadership practices.

Finally, the third stream of research in the area of management antecedents pertains to attitudes and behaviors of the top management team (TMT), because ambidexterity may be perceived as their specific capacity to reconfigure, in a repeatable manner, the existing resources and competences to adapt to the changing conditions (O’Reilly &C Tushman, 2008). If organizational units are structurally separated, then the TMT is responsible for their coordination and the implementation of the ambidextrous strategy (Turner, Swart, & Maylor, 2013). At this point it should be noted that if the members of this team are characterized by various attitudes and management perspectives, then conflict between the members is more likely, which may hinder coordination and cooperation and thus prevent the strategy from being implemented (Li, 2014). Therefore, it is necessary to introduce integrating mechanisms that will help the TMT members to act in a consistent and coherent manner to achieve the established goals, in terms of both exploration and exploitation. Such key mechanisms regulating the uniformity of TMT activities include shared vision, social integration, and situational rewards (Jansen et al., 2008).

Shared vision reflects the collective goals and aspirations of the TMT members, which express the organization’s development path. Common goals and a clearly defined vision of the company, with which TMT are in agreement, assure their enthusiastic approach and commitment to the implementation of strategic goals of the enterprise (Tsai & Ghoshal, 1998). Recent studies have confirmed the impact of shared vision of top management on achieving ambidexterity by the company (Jansen et al., 2008; Yigit, 2013) and on higher openness to the adoption and implementation of various strategic options.

Social integration reflects social interaction among members of the TMT team and satisfaction from mutual cooperation, and is directly related to affective and social factors. It is manifested by good understanding in the team, co-deciding on key issues for the company, readiness for mutual assistance, or absence of competitive behaviors among team members (O’Reilly, Caldwell, &t Barnett, 1989; Smith et al., 1994). Similarly, also in this case, high social integration increases the chances to reconcile conflicting objectives related to exploration and exploitation, and therefore it provides an opportunity to implement the ambidextrous strategy (Jansen et al., 2008). Lubatkin et al. (2006) reached a similar conclusion: having researched 139 small- and medium-sized Australian enterprises, they proved that social integration of TMT had a positive impact on ambidexterity, which in turn has a positive influence on the company’s results. Researchers argued at this point that cooperation and exchange of information, which are elements of social integration, decrease conflict caused by the desire to reconcile strategic disagreements. On the other hand, Carmeli and Halevi (2009) indicated that social integration of the TMT affects the behavioral complexity of the team, which in turn helps balance between strategic exploration and exploitation.

Situational rewards, as the third mechanism integrating the team behavior of TMT, affect primarily the cooperation in the TMT, as well as the motivation to achieve shared goals (Bloom, 1999). They reflect various encouragements in the form of prizes, share in profits, rewards, and bonuses, often of variable nature, which make team members codependent in simultaneous achievement of exploration and exploitation objectives (Smith & Tushman, 2005). Owing to such remuneration systems, an enterprise may gain benefits from limiting interpersonal competition and increasing mutual adjustment of undertaken measures, directing them most of all on collaboration and not on single operations (Shaw, Gupta, & Delery, 2002; Collins &C Clark, 2003). Therefore, the situational system of remunerating the TMT may encourage its members to implement the ambidextrous strategy.

Surely, the TMT plays a key role in effective implementation of exploration and exploitation activities, and its capabilities and nature of leadership and team behaviors are an important group of antecedents to choosing the ambidextrous strategy. Having taken them into account as a set of management conditions of choosing the ambidextrous strategy, another hypothesis was put forward:

H7. Strategic leadership is positively linked to the selection of the ambidextrous strategy in the sense that: (a) the more the top management is involved in exploration and exploitation activities, (b) the higher the level of interaction between open and closed leadership behaviors, and the stronger (c) the shared vision, (d) social integration, and (e) situational remuneration of top managers, then the higher the company’s inclination to select the ambidextrous strategy.

Both management antecedents and other intraorganizational factors, as well as external conditions resulting from environmental uncertainty, determine through mutual interactions the selection of the ambidextrous strategy of the enterprise. However, this choice should always be considered in the context of efficiency achieved, which is a result not only of the effectiveness of strategic activities, but also financial and market results, thus determining the strategic path of the enterprise’s development.

 
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