Leadership in business and especially in the corporate world is a crucial element to consider when initiating strategic change in an organization or enterprise. It is thought that with proper guidance and direction from leaders, then the process of change can run smoothly and significantly benefit an organization (Balogun 2016). Strategic leadership is therefore considered to be an essential element in the process of change implementation. Strategic transformation can come in various forms and can also have different reasons for its application. Two main types of change are, the one that aims to transform an unfavorable situation and to rebuild a failed system while another seeks to prevent a detrimental circumstance from ever happening and thus giving an organization or business a competitive advantage over its rivals (Balogun 2016). These two approaches both focus on benefiting a business and require astute leadership skills to enable successful change (Balogun 2016). Two articles, one Lessons from Turnaround Leaders by David Boyd and another Strategy, Organization and Leadership in a New Transient Advantage World by Brian Leavy approach the subject of strategic change differently. Whereas Boyds article focuses on the successful recovery process of an organization from a regressed developmental state, Leavys article delves into the matter of how to take advantage of the current transient advantage world. Both pieces present unique points of view that can be perceived to contrast sharply but both aim to bring development to an organization through effective leadership.
Transient Advantage Strategic Change
Since every business opportunity is usually accompanied by a risk that could cause a downward spiral in the progress of an organization, the Leavy approach to strategic change can be complemented by the Boyd approach that will help to build the business in case anything causes it to fall. Leavy discusses the various opportunities that are available in the contemporary world of transient advantage opportunities that organizations and companies can take hold and benefit tremendously. He describes the modern business world as one that has experienced many dynamic changes that have instigated the need for different approaches to operations and processes in the current business environment. According to Leavy (2014), the modern-day business setting is a restructuring of administration style in the current millennia. The author states that the current generation is the one faced with the challenging, yet opportunistic inflection point of the change experienced in the world. Some of these changes include dynamic technological developments and the adverse climatic changes experienced in the world among other transformations. Apart from these changes that are described as some of the main reasons for the dynamic transformations undergone in the business environment, there is also a significant rise in competition among organizations. Leavy (2014) suggests that these factors are described as some of the elements that urgently prompt various organizations to find more innovative ways of adapting to these changes. These methods applied with the aim of adapting can enable an organization to survive longer while still in business and have a significant competitive advantage over its rivals.
Numerous challenges could face a business in the contemporary transient world that is associated with the unexpected dynamic changes in the business environment and world at large. Leavy (2014) states that there are three main challenges first being the finding of an efficient way of establishing an organization or business that can match the dynamic transformations experienced in the world. The second one is promoting an innovative culture in the organization and among all members which will ensure that they all contribute towards continuous development. Another challenge that relates to the previous is the establishment of an organization that can inspire people to work towards a common goal with the contribution of their abilities that collectively help to develop the business.
Leavy describes McGraths The End of Competitive Advantage as stating the five main phases that the lifecycle of competitive advantage undergoes. He mentions the Launch phase where a likely prospect is recognized within a market and cultivated by assigning utilities that can be used to initiate development within an organization. There is also the Ramp Up phase which Leavy describes as having a notion propelled by a business motivation that can benefit business. The third stage is the Exploitation Phase that is made up of an opening that allows for the establishment of a robust strategic placement which enables the wholesome cultivation of the available competitive advantage (Leavy 2014),. This opportunity is made up of a particular proposition of value and a well-structured system to deliver the envisioned goal. There is also the Reconfiguration Phase that involves the management of available sources of competitive advantage and maintaining their dominance and keeping them up to date (Leavy 2014),. This is especially important with more organizations entering the market and creating more competition within the existing market. This will enable the organization to stay on top of all its competition and any potential ones that might emerge. The last phase is the Disengagement and Replacement Phase that involves the movement of operations and activities geared towards competitive advantage in a well-strategized manner that allows for utilization of possible opportunities before they are depleted.
Leavy describes strong competitive advantage as a long cycle that can have an exploitation phase that takes as long as a decade or longer and is often managed by specialists who have exceptional skills. Leavy explains that in the modern world, organizations must develop better tools that will enable them to manage the competitive advantage cycle to gain optimum benefits properly. Leavy (2014) states that in the modern business environment, there is emerging more competition of organizations within the same industry whereby more companies are entering the market, and there is an availability of more product and service substitutes. This means that there will have to be more innovative strategic approaches to gain competitive advantage.
Turnaround Strategic Change
David Boyd approaches strategic change in a different way compared to that of Brain Leavy. He describes ways in which companies that have fallen due to lack of proper adjustment to the changing times can be revived and rebuilt to their former glory. Boyd (2011) mentions that when the fall is very significant and hard to manage, then specialists are employed to handle such situations. These specialists are skilled in the management of the process of rebuilding and restructuring failed systems that have not adequately adjusted to the dynamic changes experienced in the world (Boyd, 2011). They apply their unique skill set and try to find out what steps should be taken towards reviving a fallen organization system. Leaders are advised to learn from these turnaround specialists by finding out what makes them successful in their work. Boyd uses the examples of five turnaround leaders to explain in more detail. According to Boyd (2011), the perceptions of these turnaround leaders is immensely beneficial to the better understanding of the steps that can be taken towards repairing a failing organization.
The leaders provide five major steps to be taken that when accompanied by other elements will support the strategic change management. The first step is Solidifying a Personal Leverage where there is an emphasis on the leaders learning specialist skills of recovery to manage the top levels before seeking to engage in lower level change management (Boyd 2011). The high most level for these leaders to learn from is the Board of Directors who can provide useful information that will guide the recovery process. There should be proper communication with the highest management which will enable them to understand the details of how strategic management is initiated. Boyd (2011) suggests that the main aim of this step is to garner the Boards support which will be crucial for effective and successful long-term strategic change.
The second step is Setting the Stage whereby objectives and goals of the business are expressed. These elements will be crucial in the decision-making process and provide a conducive environment for strategic change (Boyd 2011). The leaders should communicate to the employees what is required of them regarding their performance by defining the core values that drive employee behaviors. There should also be clear communication of impending danger to the organization primarily if the employees will be affected (Boyd 2011). They should also be made to understand what they could gain after the company recovers from its current milestone. Boyd (2011) suggests that there should be a consideration of each employee to mitigate any possible resistance to the turnaround change. This is necessary since most of the resisting parties may feel like only the leaders interests are factored in when initiating change. Boyd (2011) adds that it is important for the leaders to make the employees understand that their means of living is at stake as this will be motivation for them to accept the proposed change and adapt accordingly. Leaders should also establishment an external challenge that will be used as a benchmark for the state of the company (Boyd 2011). These external challenges in the relevant market will be compared against the internal challenges and help in the decision-making of what practices can best revive the company.
The third step in the recovery process is the generation of open dialogue where leaders create a conducive environment for communication of employee wants and need to their leaders. The leaders should also participate in the open communication and avoid limiting the employees freedom to voice their opinions and grievances (Boyd 2011)). The conducive environment sustained by the open communication will foster healthy interaction between employees and leaders which will encourage the development of innovative ideas. It is crucial for the leaders initiating the strategic change to lead by example.
The fourth step is to Stabilize the Situation by first controlling the main problem that led to the current problematic situation and failing of the company. Each business unit should be managed individually to assess which of them were most affected. This will make it easier for the leaders to mitigate the problem faster by figuring out which units should be dismantled or restructured towards realizing the desired change. The leaders should ensure that additional processes are stopped, and more effort is placed on rebuilding and maintaining the crucial processes that contribute to the desired change. Boyd (2011) also suggest reducing operating costs and instead investing more money in essential activities. When reducing operating costs, it is also sometimes necessary to reduce the workforce or make pay cuts among other options that may assist in reducing the payload.
Boyd (2011) suggests that there is need to acquire some talent from employees or outside sources whose specific skills can help to revive the company. In different turnaround circumstances, different skills may be required to enable effective strategic turnaround. These talents should be spread throughout the various functional units of the target organization to allow maximum utilization (Boyd 2011). The leaders should always be considerate of the individuals engaged in the process of change and motivate their efforts throughout the process. Bo...
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