Academic journal article Journal of Managerial Issues

CEO Perceptions of Strategic Leadership

Academic journal article Journal of Managerial Issues

CEO Perceptions of Strategic Leadership

Article excerpt

By their nature strategic decisions deal with the long-term health and vitality of the total organization. They are the most important decisions that executives make and, therefore, normally fall within the purview of top management. Because of their overriding significance, strategic decisions tend to be closely linked to form a consistent pattern for unifying and directing the organization (Harrison, 1995). Strategic decisions constitute the essence of strategic leadership. By definition a strategic leader is one who makes strategic decisions that commit the total organization to a given course of action. The principal research question to be addressed in this study is whether the chief executive officer (CEO) should unilaterally exercise strategic leadership on behalf of the total organization or whether such leadership should be shared by one or more other groups in the hierarchy of management.

The attainment of the strategic objectives underlying strategic decisions is accomplished through the effective practice of strategic leadership (van der Merwe and van der Merwe, 1985). The perceptions of executives constitute an integral part of their cognitive limitations in making strategic choices (Anderson and Paine, 1975). In this context, perception is a psychological function which enables strategic leaders to receive and process information obtained from the external environment within the strategic management process (Tregoe and Tobia, 1990). In one sense, a strategy is a set of decisions or choices made by a leader that is filtered by his/her perceptions and limited by his/her cognitive capacity (Ibrahim and Kelly, 1986). In fact, executives vary greatly in their perceptions of effective leadership in making and successfully implementing strategic choices (Harrison, 1992). Such differences may be attributable to unavoidable cognitive biases below the executive's threshold of awareness or they may reflect a conscious preference for or a predisposition toward a particular outcome inherent in the decision (Waller et al., 1995). For purposes of this article, a successful strategic choice is one that results in the attainment of the objective that gave rise to the decision within the constraints that must be observed to bring about such attainment. In essence, strategic decision success signifies intended ends accomplished within designated means.

In spite of the axiomatic perceptual inaccuracies and cognitive limitations of strategic leaders, their impressions of the factors contributing to or detracting from successful outcomes of strategic choices are highly significant for the long-term viability of the organization (Harrison, 1992). This significance is reflected in numerous studies in which the perceptions of the strategic leaders constitute the central focus of the study (Shore et al., 1995). For example, in a classic study of strategy in three industries, Lawrence and Lorsch (1967) focused extensively on the perceptions of the top executives. The research of Anderson and Paine (1975) noted that numerous subjective factors influence the perceptions of strategic leaders and, subsequently, strategic choices. Hambrick and Mason (1984) highlighted the importance of the perceptions of upper managerial echelons in making and implementing strategic decisions. And, finally, the comprehensive survey by MacCrimmon and Wehrung (1986) of 509 high-level executives in the United States and Canada revealed a plethora of variances in perceptions involved in strategic decision making at the highest levels of the corporation.

The study underlying this article was directed toward ascertaining the truly significant leadership factors that contribute to the success of implemented strategic decisions as seen through the eyes of the chief executive officer (CEO). The specific focus is on strategic leadership at the level of the CEO. In-depth studies confined exclusively to CEOs are not as common in the literature of strategic management as one might suppose. …

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