Strategic Direction

Abstract

In this chapter, the focus is on a strategic direction which is the starting point of strategy and the foothold of strategic leaders. Strategic direction determines the space available for organisational action and major business decisions; it is a guide of sorts for interaction with the future environment. It is especially important when innovative and visionary actions require a special kind of leadership and managerial skills. Mission and vision are argued to be mutually connected and inseparable constructs that are both comprised in the category of strategic direction. Mission creates a context in which vision is shaped, strategic objectives defined, and strategic activities developed while vision gives a purpose of action and it can be viewed as both a rationale of the organisation and a foundation for building commitment and inspiring stronger engagement of the organisation’s members.

Strategy as a Transnarrative

The domain of strategic leadership is primarily connected with strategic direction, which could be recognised as that which the organisation is trying to do and what it wishes to eventually become.

The basic determinant of strategic leadership is the creation of a meaning structure and sensemaking with respect to common action and its purpose, relational networks between key actors, and activities that need to be taken. Construction of a reality and sensemaking on the organisation’s path from the past towards the desired future are important elements of strategic leadership.

Our relationship with the passage of time can be best explained by comparing it to walking backwards: as we walk, our eyes are fixed on the past and our back is turned to the future, which is therefore always beyond our gaze—unknown, unclear, untouched, and uncertain.

An organisation is defined by the purposefulness of its members’ actions. “Who are we, where are we going, and what are we supposed to become?” are the fundamental questions towards a definition that the leaders need to adequately answer in order to eliminate disputes, uncertainty, and lack of understanding within the organisation.

Strategy is about focusing on what is relevant in time: it necessitates construction and, consequently, an interpretation of the future based on the understanding of the present. Present time, on the other hand, is a remnant of the past that we create and interpret retroactively in order to construct the future.

There is no clear rule here: sometimes the past is created and interpreted from the viewpoint of a desired and shaped future, and other times the construction of the future results from existing images that we have of the past. The sense of organisational existence is constituted at the same time as the past, present, and expected future are constructed and interpreted.

Strategy is a deliberate effort to “delve into” and actually see the future while making those precarious steps with our backs turned to it; as noted by Cummings and Wilson (2003, p. 1), an organisation’s strategy can be described as its ‘course’, its onward movement in space in time, where it goes and where it does not go. At the same time, it is an interpretation of reality: the way the collective members see and explain the organisation in the context of time.

Strategy relates to organisational destiny and important decisions and actions; it subliminates the alchemical magic of acting or thinking upon the essential questions that affect the collective. It connects the discovered and created meanings, gives them sense and congruence, and provides support in the attempt to make sense of the world so shaped.

Differences in opinion and doubts regarding the essence and content of strategy have not yet been resolved and are still as debated as ever, probably with even greater degree of frustration. In this context, some renowned scholars, having surrendered to scepticism and almost completely discouraged, concluded that: We simply do not know what a good strategy is or how to develop a good one (Markides, 2000, p. vii), and that the idea and practice of strategy has so many meanings that now it has none (Franklin, 1998, p. 320).

It is interesting that, about forty years ago, somebody noticed that the Japanese have no word or phrase for “something” that could be broadly defined as “company strategy” (Pascale, 1982; as cited in Whittington, 2001, p. 28).

Borges (2001, p. 99) wrote: After all, what are words? Words are symbols for shared memories. If I use a word, then you should have some experience of what the word stands for. If not, the word means nothing to you.

Strategy is, on the one hand, a construct created to explain the behaviour and intentions behind such behaviour of people, organisations and other social entities in their interaction with the environment. It exists in the minds of those who attempt to explain the world around them, give it meaning and sense, recognise and define purpose, and create a framework wherein one can influence action in the world so explained.

Strategy is shaped by those who create it through social interactions, interpretations, and meanings ascribed to it. According to Weick (1987, p. 231), strategy is a form of discovery of meaning that arises from actions that have been taken. As in other situations, its content and meaning depend on the degree to which they have been arranged into sensible, coherent configurations. Weick (1995) also asked: “How can we know what we mean until we see what we build?”¹

According to Stacey (2011, p. xviii), strategy is the emergence of organisational and individual identities, so that the concern is with how organisations come to be what they are and how those identities will continue to evolve.

It is not possible, or necessary, to arrive at a singular definition of strategy. It is important, however, to identify the outline of its definition and to clearly determine the content associated with it. We could cleverly remark that strategy was not first perceived in the real world and then defined, but rather that it was the other way around: first it was defined and postulated, and only then was it “actually seen” in the reality of social ambience.

Strategy, like any other concept, is the “residue of metaphor” (Nietzsche, 1999, p. 13), but what happened to the metaphor?

As already emphasised in the second chapter, strategy is a transnarrative with clusters of variable meanings grouped around it: its sense and content vary depending on the situation and on the time, locality, and field in which it is implemented.

Transnarrative is a neologism inspired by (but nevertheless completely different from) the familiar post-modernist concept of meta-narrative (or meta-narration), introduced by philosopher Jean-François Lyotard. Meta-narrative can be summarised as the overall (“grand”) scheme that explains knowledge and experience (like a narrative about smaller narratives which, by arranging them into conceptual models, pieces together an overall picture).²

Transnarratives are concepts that are ubiquitous across various segments of human activity and the understanding of which cannot be singularly defined. This inability to arrive at a precise definition is not the result of insufficient or underdeveloped knowledge, nor is it the result of lack of (complete) insight into the matter. Transnarratives are beyond definition, but they nevertheless lie within the scope of hermeneutics. The meanings of these concepts draw closer and, at the same time, move further apart from one another; they exchange common “clues” and “constituents”, but never actually converge or overlap completely; they create all kinds of different types of autonomous contexts which mirror side meanings.

Strategy can never achieve self-identity, nor can its scope of meaning be uniformly determined. Meanings of strategy converge and diverge at the same time; myriads of existing definitions never fully overlap; some of them are contradictory and divisible, some are too broad, encompassing the extensive scope of determination, while others are too narrow, accentuating only one, insufficiently comprehensive dimension of definition.

Strategy is a plurality of social constructs about distinctive aspects of human existence; there is no invariable substance that it transcends. It is omnipresent, widespread and often inevitable; its sense and contents do not coincide in every situation as they are dependent on time, locality, and field in which it is being implemented.

The reality of strategy becomes part of the big picture, and the chaotic relations between the multitude of unexplained elements of an elusive reality that is beyond comprehension become irrelevant in the world of actuality.

It is also a structure that establishes order in networks of meaning. Strategy is important because people only perceive selected pieces of reality (Lacan, 2008, p. 56), due to their own cognitive limitations and the complexity of everything that surrounds them. Strategy complements the incomplete, inconsistent and bare-boned human reality by filling it with important metaphors, and provides a reason for action not only after the fact but also before (Fig. 5.1).

Fig. 5.1

Strategy between construction and interpretation

The creation of a simpler, more comprehensible world in which one can navigate more easily, without cognitive gaps and mental mess, requires undoubting decision regarding the determination of organisational existence.

Strategy gradually emerges through collective understanding of the world and creates a foothold and guidance that encircle the collective with clusters of imprinted and interconnected meanings that justify their actions and mirror the sense behind them (Fig. 5.2).

Fig. 5.2

Strategy as a structure for establishing order in networks of meaning

Strategic direction arises in most cases based on the organisation’s historical context and previous development path, its accepted guidelines and principles of action, available and newly-created resource combinations, as well as existing and expected impacts of environmental factors.

Strategy needs to provide a glimpse of the organisation’s tomorrow; or, to be more precise, its tomorrow has to be explained and interpreted by strategy—by an imaginary picture of a desirable future, basic strategic directions, and other strategic actions that make such tomorrow possible.

Understanding the organisation’s environment cannot be complete or meaningful without exploration of the future, just like it is impossible to even begin thinking about strategy without making certain assumptions about what tomorrow will bring. Strategic leaders need to analyse the prerequisites for the organisation’s continued existence in the future; they ought to take note of both the sudden and the slowly-occurring changes, and analyse the effects of individual factors on the environment that the organisation will find itself in.

In other words, strategic leaders attempt to monitor the organisational destiny and direct its main activities, moves and decisions toward the desired future, or toward an attainable picture of the organisation in a time that is yet to come. This kind of definition derives from human nature: the intention to create the future is inherent in human existence and action, both individual and collective.

What is important in this context is sensemaking and sensegiving, recognising and orchestrating meaning, and in particular, creating convincing narratives and symbols within the organisation, which will add to the plausibility of its strategic direction.

The sensemaking process involves three components: cues, frames, and ways in which cues and frames are connected. Frames are knowledge structures created in one’s past, through socialisation, whereas cues appear in the present moment as it is being experienced. In and of itself, neither of them has any meaning. They contain rules and values and serve as a guide to facilitate understanding. Meaning is only created when people form a relation between frames and cues. In other words, connecting past experiences in the form of categories and frames with cues being perceived at the present moment, is what creates meaning.

Weick (1995) identifies six types of frames: ideologies as vocabularies of society, categories, which classify organisational practices (vocabularies of organizing), paradigms as vocabularies of work, theories of action (vocabularies of coping), tradition (vocabularies of predecessors), and stories (vocabularies of sequence and experience).

Formation of strategic direction needs to be differentiated from planning as a classic managerial function, although those two activities are complementary and mutually connected.

Planning is focused on deduction, it brings order into the system, and does not rely on major changes. Formation of direction, on the other hand, is an inductive process in which leaders explore and find patterns, relations, and connections between things that can be used as building blocks in the creation of a desired future. Outcomes and results of planning are plans, whereas the results of creating direction are visions and strategies (Kotter, 1990).

An organisation’s Purpose and Mission

In an organisation, purpose acts as a kind of social glue: a logical and substantiated justification for its continued existence in the complex social fabric.

It is recognised in the basic principles of organisational action, its “higher ideals” so to speak, which serve as a motivational integrator for stakeholders and even more so as an inspiration for the management and the collective.

Purpose draws from organisational beliefs, the members’ shared assumptions about the nature and character of the organisation’s environment, and about what it should do to be successful.

Where key individuals and groups within the organisation do not share the same fundamental beliefs, the structure of the environment will be perceived and interpreted divergently; threats and opportunities will be assessed differently, and this in turn will result in strategic management and decision-making becoming sluggish, obstructed, and relatively ineffective. Perception, recognition and harmonisation of purpose is a prerequisite for existence and development of strategic direction.

On the other hand, purpose provides the power of leverage in the construction of collective identity and the core around which the ideological layers of the organisation are wrapped. It is possible for its integrating character to serve as a kind of a cloak concealing the intention of upholding existing social constellations and maintain the balance of power within the organisation.

Some authors even believe that the category of organisational purpose is a mythical construct that helps ideology-dependent organisations build a complex illusion that masks the existing exploitative reality and helps indoctrinate or “brainwash” members of the collective (Levy et al., 2003).

Organisational mission is the concept that is superordinate to organisational purpose.

Etymologically speaking, the word mission comes from the Latin word mittere, which means “to send.” It is about “sending somebody somewhere”, about sending them on a mission to do a task or fulfil an obligation.

Firstly, mission mirrors the fundamental purpose of existence which is unique and specific to each individual organisational and deeply rooted in its history, specificities and relations between key stakeholders. It is a kind of self-definition of an organisation and it helps to identify its social task.

It should unequivocally define the sense, the reasons for existence, and the identity of the organisation. The beliefs and aspirations of the leaders, managers, and important stakeholders need to be manifested in it.

Secondly, mission provides guidelines about how the organisation is to cope with the passage of time: it can be understood as a general statement in which one should identify the present strategic position, principles of action, and other factors that move and direct the collective from the present towards the desired future.

A more comprehensive understanding of mission can be gained if answers to the following four questions are given: (1) Why does the organisation exist?, (2) What does it do?, (3) Whose interests and demands does it satisfy?, and (4) What are the core values on which it bases its existence?

Conventional wisdom places mission in the centre of strategy process. Mission creates context in which vision is shaped, strategic objectives defined, and strategic activities developed. It determines the activity, the markets and the technologies that are of particular importance to the organisation, and recognises the important elements of the organisation’s history and the ways it interacts with actors in its environment. In the other words, a good mission provides a consistent framework for organisational action: it needs to be the basis for the development of the organisation’s direction in the future. It defines the boundaries within which strategic choices and actions are made and implemented, and an appropriate ambience for organisational development created.

A mission should also address core values and main priorities: it needs to give answers to questions about what the organisation really is like and what the desired and welcome directions of its further development actually are. It has to reflect the interests, demands, and needs of key stakeholders. The mission is a reflection of the way the collective is woven into the ambience.

Organisations strive to having only a few core values that truly reflect their deepest essence. Values are beliefs and opinions that are easily recognised in day-to-day activities of the collective. In some organisations, core values originate in strong personal beliefs of the founders or charismatic leaders, whereas in others they slowly form over time—for various reasons—eventually becoming a set of timeless value principles deeply rooted in the behaviour of people inside and outside the organisation.

The role of mission is also connected with the development of a desirable culture and creation of organisational identity.

Mission has the function of ensuring cultural cohesion that enables the organisation to operate as a uniform collective. It comprises strict standards and values that influence people’s behaviour, their joint work, and the manner of keeping up with organisational objectives (Campbell & Yeung, 1991, pp. 10–11).

Creation of shared mental models and common values can help leaders, other managers and employees understand and interpret events the same way, and encourage them in the creation of the same, distinct language used by the organisation that they can all understand.

Organisational identity is closely connected with important aspects of organisational mission: it represents the organisation’s members’ collective understanding of the crucial aspects of that which sets them apart from others in their environment. It includes a set of objects and symbols that members perceive to be central, distinctive, and enduring to their organization (Albert & Whetten, 1985) and provides members with an essential lens for their interpretation and sensemaking about different events that occur during organizational life (Dutton & Dukerich, 1991).

It can also be described as a set of narratives that give sense to the organisation’s continuity and that are intended to answer the question “Who are we as an organisation?” (Fiol, 1998). As Gioia (1998) stated, organisational identity actually determines the organisation by indicating what kind of organization it is and what makes it different from other entities in the environment. At the same time, it must not be forgotten that organisational identity has a dual nature: in addition to difference, it also points to similarity (Whetten, 2006; Ravasi, 2016).

Organisational identity is socially constructed: its continuity is maintained through conversations within the organisation (Narayanan et al., 2011). Conversation as a term involves language and rhetoric, narratives and stories.

Apart from that, mission gives legitimacy to organisational conduct.

It connects key actors in creating values that are in common interest and thus increases chances that the most important groups or members will trust the leadership, and also accept and support the organisation’s strategic action.

Mission can inspire individuals to work together in a specific way. Development of fundamental principles that drive organisational action is accompanied by emergence of the esprit de corps with great potential to motivate people in the long-term (De Wit & Meyer, 2010, p. 600).

Creating a sense of togetherness and focus on interests of the organisation as a whole can have a stimulating effect when it comes to overcoming or reducing inherent conflicts between groups with contradictory objectives.

A mission may be well defined and enduring, widely accepted, and sufficient for achieving organisational aspirations. Moreover, even when desirable, a change of mission is not the least simple: it takes much effort and time to change, more or less successfully, the usages that the organisation’s mission is based on.

Visioning

Mission and vision are mutually connected and inseparable constructs that are both comprised in the category of strategic direction. Unlike mission, which primarily focuses on principles of action (by recognising purpose or the raison d’être of an organisation, its values and business philosophy, describing how one should act, and outlining the activities, management and desirable future direction), vision on the other hand represents a mental image of the desired future situation: a realistic, credible, and attractive future of the organisation (Stacey, 1997, p. 328).

Mission is the concrete cornerstone of the strategic process and the most important foundation for designing a strategic vision. Vision provides a glimpse of what the organisation could become in the near future (Grant, 2002, p. 60).

Vision is not a mystical, inexplicable or unattainable construct; it is supposed to paint a picture of the organisation’s future and act as a symbol that facilitates development of a structure of meaning within the organisation. Vision indicates a transition from the present state to a desired future one within the framework outlined by the mission, and refers to a concentration of efforts of strategic leadership in the intention to develop and implement strategy.

Mintzberg et al. (1998) maintain that vision designates inspiration and the sense behind that which needs to be done; it is a general signpost that cannot be formulated in great detail, specifically or clearly. This makes vision flexible, which allows strategic leaders to change it based on their experiences.

Vision gives purpose of action and it can be viewed as a rationale of the organisation, but also as a foundation for building commitment and inspiring stronger engagement of the organisation’s members. A clear, stimulating, and plausible vision shows that there are no conflicts within the organisation or any great doubts when it comes to questions such as “Where are we heading?” or “What do we want to become in the future?” It is the starting point of the process of strategic thinking and helps guide the organisation in the desired direction.

Vision can be shaped by entrepreneurs, leaders, managers, organisations, and groups of organisations.

Complexity, unpredictability, and ambiguity of future ambience make the need for a powerful vision even greater, in terms of it serving as an important lever in recognising and utilising the opportunities and challenges in the construction of organisational future.

Through creation and communication of vision, strategic leadership builds the bridge between the present and the future (Bennis & Nanus, 1985).

A good strategic vision needs to provide significant detachment from the present situation. It should be more than a mere following of the trends or an uninspired facsimile of the present. It should be a supporting structure within which one recognises the distinctive principles of action and organisational aspirations. When, back in early 1900s, Henry Ford conceived his challenging vision of “a car for every family,” most people saw it as only an incredible fantasy. And yet, this fantastical vision changed everything, and made the world what it is today.

Vision needs to inspire the creation of clusters of attractive meanings and expectations for actors, by setting (relatively hard to reach) challenges to be overcome in the creation of a desired future and strengthening of organisational integrity. It should be strongly impressed upon the members in order to create commitment and increase motivation in them; moreover, flexibility and openness are also required, as are attractiveness and even magnetism; in short, it has to be at the heart of organisational action.

Despite the fact that it should be challenging and ambitious, vision must not be the point of setting off on a journey to the unreachable and imaginary; it has to focus on a future that is sufficiently distant but at the same time achievable through planning and acting in the present, and coherent enough to show an overall, comprehensive picture of an attainable future.

A vision has to be unique, distinct, and singular: it should be the element that distinguishes the organisation from others (Fig. 5.3).

Fig. 5.3

Strategic direction

It is interesting to consider the crucial role of integrity in intermediation and balancing out of the tension between strategic planning and organisational vision; in this context, integrity enables strategic leadership to function as a “coherent entity” (Worden, 2003, p. 38).

There are at least three important roles that vision plays in an organisation.

Firstly, together with the mission, vision constitutes strategic direction and defines the space for organisational action. It serves as a framework for developing priorities, main objectives, and policies. It is the basis for implementation of all changes that are required. Moreover, it acts as a prerequisite for consistency in organisational conduct, considering that strategic decisions and actions have to be aligned with the vision. As insightfully pointed out by Grant, vision demotivates optimisation of each individual business decision by considering every permutation of possible versions of decisions (Grant, 2002, p. 28).

Secondly, vision strengthens motivation among members by giving a clear perspective of organisational development and creating important determinants in the construction of common mental models. It encourages them to efficiently channel their activities in the strategic leaders’ desired direction. The objective of visioning is not only to provide clear guidance for shaping strategy but also to articulate organisational aspirations that can create motivation for ultimate effectiveness (Grant, 2002, pp. 29–30).

Thirdly, vision serves as an important means of communication aimed at important stakeholders. Vision statements and slogans create new and reinforce existing connections between important individuals and groups within the organisation and outside it.

In conclusion, a powerful and plausible vision can be an important element in helping members of the organisation accept necessary changes required to ensure future survival. The very possibility of change is actually frightening and people need more than just a reason to move on from the present; they also need an idea of a better future.

Strategic Direction as a Symbolic Illusion

Things can be observed completely differently, though. Mission and vision can be viewed as narratives that need not be in touch with organisational reality. They don’t have to give answers to questions about self-definition, core values, or targeted organisational future, nor do they have to be the big, ambitious action plans like strategic intent is.

Their role need not be one of placement in the process of strategy creation and implementation, nor does strategy itself have to be formalised the way it is usually understood in the processes of strategic management. This kind of rationalisation of strategic direction is only one of the possible options.

In fact, the purposefulness of organisational action has to have an anchoring point that may only be symbolic in nature. Strategic direction helps tie down bundles and strings of meanings around images, metaphors, pictures and stories that may not directly interpret the present or future organisational existence, but that nevertheless justify and legitimise organisation action.

It is an illusion, but one that does not obscure the subject-matter of organisational purposefulness. It envelops and permeates into decisions and activities of strategic leaders, justifying them in whatever form they may take. It does not attempt to explain the reason for acting or give a distinct picture of the future, but rather it generates memorable and unmistakable symbols that can be used as an encouragement to strategic leadership in all kinds of (often variable) organisational intents.

The illusion is broad and elastic enough to allow the narration of rationality of performance ex post, but still sufficiently plausible for a motivational web to be woven around it, in which members of the collective will be caught ex ante.

Therefore, there has to be a support of some kind on which the choices made by strategic leaders will be based, regardless of how realistic such support is or what it comprises.

Moreover, no matter how we understand strategy and creation thereof, it always paints a picture of stability in organisational conduct. On the other hand, shaping strategy is generally connected with rapid and often discontinuous change (Mintzberg, 1994, p. 240) and consequently there is greater need for a broad symbolic umbrella that will provide space for strategic leaders’ action.

Strategy is an addition to the reality created in that space. It is inseparable from problem solving and social interaction within the organisation. The goal is to construct an ambience in which leadership will be given sense through rhetoric, symbols and values, and which will be conducive to organisational cohesion, identification, socialisation, and indoctrination of members.

From this perspective, strategic direction is a cloak without any clearly visible content underneath. It is a broad identifier where that which is identified changes depending on the aspirations of strategic leaders, and helps with integration and external adaptation of the collective. The idea that things exist independently from perception and that the key task is to recognise and describe them, is not easily accepted. If something really does exist beyond our mental capacities, then such a thing is unfathomable and beyond comprehension. Strategic direction, within the meaning used in recent “strategy lingo,” is certainly not one of those things.

Indeed, that which strategic direction determines or refers to often may be found missing, but that’s not really too big of an issue: strategic leaders and other organisational actors create, or rather reveal reality by giving it meaning and enriching it; they experience and internalise it, and live within their own ideas about it. They function in an illusion of a global reality explained by reason, oblivious of the fact that they are actually the makers of it.

Enactment of reality attenuates a chaotic and uncertain ambience: interactions between members and their exchanges of their take on reality create a common language, and when it comes to language, everything is possible. Thus, through listening and telling stories, creating and sharing meanings, games, enactments, and ceremonies, things can eventuate inside the organisation which we usually refer to as mission, vision, purpose, strategy, or alike.

One must not forget that language is not a means of describing the human condition—in fact, language creates the human condition. The world we live in, which we perceive through experiences, is the product of language and, as a result, language not only describes an object, it creates it as well.

We do not live in reality; instead, we live inside our own ideas of what reality is—and these ideas are constructed in language. There can be no strategy without stories and myths, without acting and enacting, the paradoxical and the absurd, or without magic, imagination and illusion: in other words, without the things we have decided to refer to as strategy and which we communicate in different ways.

Metaphors and metonymies, as well as other figures of speech, are places where we can find sparks, shadows, and other traces of strategy. Language is an important part of the story of strategy, and interpretation of meaning can play an important role in the creation of new knowledge.

Enactment of strategic leadership is often accompanied by the imprinting of symbols and stories that turn to narratives we can sometimes call “strategic direction” or by some other, similar name.

The illusion of such constructed “common values,” “organisational purpose,” or “clear vision” can integrate the collective, reduce the use of control mechanisms, and enable the strategic leader to develop numerous interpretations that can be used to justify action planning and implementation, as well as some other of the leader’s actions in the light of all possible circumstances that may occur. These constructs have to be distinctive and plausible, and they need to communicate powerful messages in order for their place in the organisational reality to be recognised and strategic leadership rationalised.

Finally, strategic direction has to be simple in expression. Cummings and Wilson (2003, p. 4) maintain that a good strategy (whether explicit or implicit) animates the organisation; they underline the importance of images in the simplification of a complex world, and argue that the art of strategy lies both in the combination of framework, images or maps and choice of their focus (e.g., the big picture versus certain detail), toward mapping an organization’s particular course. They indirectly emphasise the importance of semiotics in creating strategic discourse, concluding that further postmodern paradox is that simple strategic images have never been useful than they are in these increasingly complex times (p. 26).

Ownership of Strategic Direction

Strategy always has to be oriented towards the future: towards discovering, exploring and exploiting new potentials, resources and capacities, including opportunities and challenges that can contribute to survival in the long run.

Strategic direction is the starting point of strategy and the foothold of strategic leaders. It determines the space available for organisational action and major business decisions; it is a guide of sorts for interaction with the future environment. Its domain is broader than the strategic objectives; it includes distinctive principles of action and organisational aspirations, a vision of what the organisation’s position should be at a future point in time. It is especially important in situations when the “rules of the game” are changing, or in other words, when innovative and visionary actions require a special kind of leadership and managerial skills.

It also helps members of the collective to make decisions and act with minimum formal monitoring or control mechanisms. This way, strategic leaders can focus on other matters, such as adapting the vision to suit the circumstances, or other (Rowe & Nejad, 2009). Besides that, strategic direction can help organisational leaders avoid the trap of dispersion of resources into too many directions or other pitfalls such as uncertainty or lack of clarity of planned objectives (Ansoff, 1965, pp. 105–8).

Continuation and instrumentalization of strategic direction open up the interesting question of “ownership,” or control of mission and vision of the organisation, whether these constructs are merely a symbolic illusion or an important part carved out of the strategic process.

This question may be posed like this: is the role of strategic leadership decisive when it comes to organisational sensemaking and determining the direction of action, or is strategic direction the result of collective intentionality, where it emerges as a consequence of the organisation’s history, interactions of its members, and successful attempts at action that eventually turn out to be desired behavioural patterns?

Strategic direction can be created in several ways, with two extremes being identifiable. Strategic leaders can be (1) visionaries, so-called free-riders who use the organisation as an instrument for achieving their own intentions and ambitions, or (2) team players, organisational actors who merely embrace the existing mission and vision, and accept the obligation of fitting them into organisational action.

In the former case, there is high probability of identification of collective with the leader, whereas in the latter there is great change of leader’s identification with the collective.

It is widely understood that strategic leaders need to develop and/or raise awareness of the mission and vision that mirror organisational uniqueness, imprint them into organisational day-to-day activities, create adequate narratives and clusters of meaning, bring them closer to members of the collective and stakeholders, and use them as a guidance and inspiration in organisational action.

According to this view, the role of strategic leaders is key because one has to bridge the gap between the situation “as is” and the desired situation. Identification, discovery or formulation of mission, just like the creation of a strong and credible vision, help create a context in which strategic objectives are defined, versions of strategy shaped and evaluated, and strategic decisions made and implemented. In other words, strategic direction has to mirror the principles, the boundaries and the directions of action, while at the same time strengthening the organisation’s members’ commitment to performing their tasks and duties.

Some authors find that the definition of strategic leadership implies an ability to project vision, believing that the key prerequisite for taking on the role of strategic leader is conceptual capacity necessary for good-quality visioning (Waldman et al., 2006, p. 360) or simply identifying strategic leadership with the leaders’ capabilities, wisdom and experience in creating vision and making important decisions in a complex and uncertain environment (Guillot, 2003). This perspective is based on the idea that visioning is the primary task of strategic leadership (e.g., Lear, 2012) together with creating the preconditions for making vision, the desired future of the organisation, a reality.

“Ownership” of strategic direction requires distinctive transformation, integration and communication skills. Successful strategic leaders see the big picture and understand their environment; they know how to set the bar high and act accordingly over time; they are capable of motivating the members of the organisation and obtaining their consent for ambitious plans, and they know how to integrate their combined efforts and aspirations in the organisation’s strategic action.

Leaders capable of articulating good visions are not magicians; they are strategic thinkers willing to take risks and depart from commonality and mediocrity (Kotter, 1990).

Imaginativeness and talent to see the world differently are key qualities that strategic leaders should have when it comes to creating vision. The magic of good vision lies in the imagination of the upper echelons, which is fuelled by purposeful gathering and creative analysis of important information, clever identification of key trends in the environment, and a business-minded attempt to define new rules in the game of competition. They not only accept, reveal and/or construct organisational vision, but also incorporate social reality of the environment into which the organisation is inextricably woven (Worden, 2003).

On the other hand, some think that strategic leadership does not play a crucial role in shaping strategic direction, and that it may be created and developed in countless ways.

“Ownership” of strategic direction in such situations is not acquired through creative power and imagination of the leader through an in-depth reformulation of purpose and direction of action, but rather it is the result of socio-political relations, power structures and other intraorganizational relationships (Fig. 5.4).

Fig. 5.4

Two types of “ownership” of strategic direction

Strategic leaders strive to strengthen their position of power, primarily with a view of maintaining “ownership” of strategy and expanding their discretionary space in unforeseen situations, especially when business results are not at satisfactory levels (Tipurić, 2011, p. 357).

Strategy can be observed as a power lever in relationships between stakeholders, where its “usability” is not measured in business results but in the potential for stronger and deeper entrenchment) of top managers (Tipurić, 2011, p. 12).³ Its content alone (in terms of a formalised statement used to communicate strategy between organisational actors) is not of crucial importance; much more important is its role as one of the “sources of power” of strategic leaders vis-à-vis other members within the organisation and outside it.

Furthermore, vision can also emerge elsewhere in the organisation, or even somewhere in its environment. It can be inherited, original, or transferred. It can result from mimicry or transposition from another context. It can occur accidentally or under the influence of institutional pressures.

Strategic leaders can also have limits imposed on them in the form of managerial discretion, contextual limitations or through overpowering support of the current direction on the part of important constituents.

They have to own the mission and vision, recognise purpose, create plausible interpretations, and give sense to organisational existence. Their role is primarily to integrate direction into day-to-day organisational conduct, establish the mission and vision as beacons that will guide and coordinate the activities of all members individually and of the collective as a whole, and create a climate that will support the required change in strategic guidelines. In this context, they need to accept fundamental organisational values that are explicitly or implicitly comprised in the organisational mission.⁴

It is the task of strategic leaders to embody the distinctiveness of the vision, to legitimise it, and to align it with the organisational ambience (Nutt & Backoff, 1993, p. 330) or to efficiently connect strategy with organisational action in order to achieve the outcomes that promise an adaptive advantage and survival in the long term.

They must wisely and efficiently communicate the vision and mission, frame the way organisational aspirations are perceived, and give sense to important patterns of organisational conduct. Moreover, they have to invest time and effort in establishing and maintaining a common perspective of the world by strengthening organisational culture and identity.

Strategic leaders have to position strategic direction, irrespective of the method it was created, as the pivotal point of their work, and in doing so they have to take into consideration an idea aptly pointed out by Rumelt (2011, p. 5): Strategy cannot be a useful concept if it is a synonym for success. In the same text, he also added: Strategy is at least as much about what an organization does not do as it is about what it does (Rumelt, 2011, p. 20).

This way of thinking about the role of strategic leadership additionally accentuates the meaning of strategy as a phenomenon of focus: a cognitive and behavioural effort in the selection of the important from the unimportant in the context of time.

Strategic leaders need to think about the future and analyse patterns of past successes and failures by comparing them with others. The focus should always be on organisational change and on the setting of challenging determinants of development. In interaction with other members of the collective, strategic leaders need to construct the environment, develop strategic infrastructure, and orchestrate organisational meanings (Narayanan et al., 2011).