The relationship between strategic leadership and strategic alignment in high-performance companies in South Africa

Abstract

In the global economy of the 21st century, competition is complex, challenging and fraught with competitive opportunities and threats. Strategic leadership is increasingly becoming the main focus for business and academics alike and is the key issue facing contemporary organisations. Without effective strategic leadership, the capability of a company to achieve or sustain a competitive advantage is greatly constrained. More than 30 years of Harvard Business School research have shown that aligned and integrated companies outperform their nearest competitors by every major financial measure. The organisational effectiveness emanating from alignment is a significant competitive advantage. Alignment is that optimal state in which strategy, employees, customers and key processes work in concert to propel growth and profits. Aligned organisations enjoy greater customer and employee satisfaction and produce superior results. Can leadership make a difference? Some leaders do, some do not - and many more could. Effective strategic leadership can thus help organisations enhance performance while competing in turbulent and unpredictable environments. However, there has been little empirical evidence of the effects of strategic level leadership on organisational processes that have distinctive strategic significance. A greater understanding of the criteria that influence success in organisations will enable organisations to take positive action to become more successful. iv This study examines the importance of critical leadership criteria and the degree of alignment in high-performing organisations. A quantitative research design was used in this study to assess the impact of strategic leadership on strategic alignment of business organisations in South Africa. The research instruments to test the research questions comprised two questionnaires. The first was used to establish the value top leadership place on selected critical leadership criteria, and the second to establish the level of alignment in the organisations under investigation. The population selected for this study consisted of the companies included in the 200 top-performing organisations which appeared in the 2007 Financial Mail. Six companies participated in the research. The data was electronically collated into a database and the results were then analysed using the statistical inferential techniques of correlation and linear regression analysis. The study proposes that strategic leadership will positively influence strategic alignment which, in turn, will have a beneficial effect on organisational performance.