The impact of business strategy on leadership

Abstract

Purpose

The purpose of this paper is to test the proposition that business strategy affects leadership functions, skills, traits, and styles, and to assess the implications of these effects for the practice of both leadership and strategic planning.

Design/methodology/approach

This is an empirical study based on over 450 responses to an online survey. Continuous rating scales allowed the use of regression analysis to test the impacts of different strategies on leadership.

Findings

The results provide strong empirical evidence that Product (Differentiation vs Low Cost strategies), Best Value, and Blue Ocean strategies have significant effects on leadership. Market strategies (Broad vs Niche strategies) have limited impacts. The greater complexity of Product, Best Value, and Blue Ocean strategies underlie these findings.

Research limitations/implications

This study explores the effects of strategy on leadership. Future studies need to explore if these effects are moderated by external, competitive conditions, and if strategy mediates the impacts of leadership on organizational performance.

Practical implications

The practical implications of these findings are that leaders must adjust their behavior and leadership styles to effectively implement alternative strategies, and planners must assess their organization’s leadership capabilities when formulating strategy.

Originality/value

There have been numerous studies of the impacts of external/internal conditions on leadership, but this is one of the first studies of the critical impacts of strategy on leadership.

Citation

Marx, T.G. (2015), "The impact of business strategy on leadership", Journal of Strategy and Management, Vol. 8 No. 2, pp. 110-126. https://doi.org/10.1108/JSMA-06-2014-0042