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
11-2
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
11-3
Designing the Organization
• Designing the organization
 A strategic leadership activity of building
structures, teams, systems, and
organizational processes that facilitate the
implementation of the leader’s vision and
strategies.
11-4
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
11-5
Nurturing an Excellent and
Ethical Culture
• Excellent and ethical organizational
culture
 an organizational culture focused on core
competencies and high ethical standards
11-6
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
11-7
The Effective Use of Power
• Power
 a leader’s 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 leader’s
power.
11-8
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
11-9
QUESTION
The "top down" perspective of
empowerment
A. Encourages intelligent risk-taking
B. Trusts people to perform
C. Encourages cooperative behavior
D. Delegates responsibility
11-10
Empowering Employees
at All Levels
Top-down perspective
• Start at the top.
• Clarify the organization’s mission, vision, and
values.
• Clearly specify the tasks, roles, and rewards for
employees.
• Delegate responsibility.
• Hold people accountable for results.
11-11
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
11-12
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
11-13
Best Practices: Learning from Failures
11-14
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.
11-15
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
11-16
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.
11-17
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,
11-18
Integrity-based Ethics Programs
Integrity-based Ethics Programs include:
1. enabling ethical conduct;
2. examining the organization’s and
members’ core guiding values, thoughts,
and actions; and
3. defining the responsibilities and
aspirations that constitute an
organization’s ethical compass.
11-19
Key Elements of Highly
Ethical Organizations
•
•
•
•
Role models
Corporate credos and codes of conduct
Reward and evaluation systems
Policies and procedures
11-20