Executives Must Understand How Leadership Strategy Drives Business Results

Do you suffer from a gap between your strategy and its execution?

We studied the differences between under-performing and superior-performing organizations as they worked to translate strategy into desired business results, and found that executives in superior-performing organizations made a clear connection between their business strategy and a leadership strategy.

In top-performing organizations, the senior teams understood they needed to invest in a robust leadership strategy if they were to successfully execute and refine their business strategy.

This recognition raises decisions about leadership development to the strategic level. When executives set strategy, they also took a hard look at the organization’s ability to implement those strategies — and created parallel processes to develop the skills and behaviors they needed to live up to their performance goals.

4 Elements Needed for a Leadership Strategy Connected to Business Results

A leadership strategy goes much deeper than a generalized belief in developing leaders and organizational talent. There are 4 key elements of an effective leadership strategy — and none of them are simple, check-the-box steps. Executives in high-performing organizations will set a leadership strategy that:

  1. Identifies the critical drivers of organizational success. What’s absolutely essential for leaders of the organization to accomplish in order to successfully execute its business strategy?
  2. Shapes a culture that provides the conditions for individuals to perform. What type of culture is necessary for leaders to create that fosters organizational success?
  3. Creates a strong and sustainable talent pipeline. Are the organization’s current talent systems and leadership architecture aligned with desired organization competencies and leadership culture?
  4. Evolves the organizational design to best support execution on the business strategy. Do the organization’s structures, systems, and processes strengthen the ability for culture and leadership to evolve in support of business strategies?

You must focus first on understanding what drives your business and shaping the culture which enables you to execute the chosen strategy.

From there, almost all progress is made from selecting the best potential from the talent pool available and preparing that talent to respond to the demands placed upon them. Then craft the organizational structures and necessary measurement to make sure that desired outcomes are being achieved.

By making the leadership strategy explicit and staying the course, the organization begins to unlock the inherent performance potential of the organization — thus bridging the strategy/performance gap.

6 Things Executives Do at High-Performing Organizations to Connect Leadership Strategy with Business Strategy

A solid strategy doesn’t guarantee success. Plenty of organizations have a strategy that looks good on paper, but falls short or fails to deliver results.

The collective ability to lead strategically is a defining characteristic of executive teams in high-performing organizations. These executives:

  1. Invest significant time on questions related to strategic drivers coupled with powerful questions of leadership.
  2. Distinguish the periodic strategic planning process from leading strategically for ongoing organizational impact.
  3. Know that good strategic leadership at the organizational level is somewhat different from effective leadership by individuals scattered about the organization.
  4. Realize that when strategy lacks meaning for people, it’s unlikely that they will assimilate the essence of strategic directives and perform to their highest potential.
  5. Pay attention to leadership strategy along with the business strategy in order to reach their performance potential.
  6. Identify and focus on their most pressing leadership challenges and invest in developing the leadership capabilities to meet those challenges.

In summary, business strategy is the foundation of a leadership strategy. It provides the direction and the motivation for talent development. In turn, it is talent that will allow the business strategy to be realized, refined, and reinvented over the lifetime of the organization. By making explicit the leadership drivers, the culture, talent systems, and organizational design, the organization begins to unlock the inherent performance potential of the organization.

Download the full white paper to learn more about the challenges senior leaders face when growing their businesses and how leadership strategy can drive business results.

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