Strategic Leadership: Creating a Learning Organization and an Ethical Organization Chapter Eleven Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin

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

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

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 Compliance- Based Approaches Compliance-based ethics programs  programs for building ethical organizations that have the goal of preventing, detecting, and punishing legal violations

Integrity-Based versus Compliance- Based 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

Key Elements of Highly Ethical Organizations Role models Corporate credos and codes of conduct Reward and evaluation systems Policies and procedures 11-20