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What is Strategic Leadership? A Balance of Contradictions

Updated: Sep 4, 2022


"If everyone thinks you have a good idea, you´re too late."

- Paul Hawken


One of my favorite quotes, these words by Paul Hawken demonstrate the challenge strategic leaders face: they refuse to be late to the game and when they make bold decisions, not everyone likes them (it often gets personal) or their ideas.


Strategic leaders are frequently met with harsh skepticism because of the uncomfortable change they introduce. Darwin Smith, the legendary CEO of Kimberly Clark who led their spectacular turnaround and outperformed competitor and S&P 500 growth considerably, was initially challenged as unqualified by his own directors.


I’ve read ample articles on defining strategic leadership that outline the skills and traits required…


But there’s something missing.


The key to understanding strategic leadership is through the recognition of a contradiction - the tension between transformational vision and balanced pragmatism.


We’ll look at the nature of this tension with examples from Tesla and Amazon, a list of strategic leaders, and discuss how you can portray strategic leadership in your role.


Strategic Leadership vs. Leadership and Strategy


Let’s start by getting definitions out of the way…


You may not realize it, but strategy and leadership exist separately all the time. Becoming a strategic leader is harder than one might expect; not all leaders are strategic and not all strategists are leaders.


Leadership: My favorite definition of leadership is “empowering others to do great things.”


There is no necessity for bold strategy here, as you can certainly be a strong leader who manages day-to-day operational needs and interlocks with strategy without setting it yourself.


Strategy: My definition of strategy is posed as a question: “what are the critical factors of the situation, and what actions do I choose and connect in order to win?”


You can find plenty of consultants that may excel at strategy formulation yet lack leadership ability.


Rather than combining these definitions together, I propose giving strategic leadership a fresh definition, in the form of a simple equation.


Defining strategic leadership



Strategic Leadership = Transformational Vision + Balanced Pragmatism



This visual breaks down the components of strategic leadership.  You can see the tension between transformational vision and balanced pragmatism.  This tension characterizes the pendulum swing of strategic leadership.

Transformational Vision: Leans toward individual actions and choices

  • Futuristic Thinking: Anticipate and act on signals of change when others are skeptical, even with limited data

  • Risk: Willingness to take large risks, allocating resources away from proven channels and into uncharted, higher reward territories

  • Inspirational: Your vision becomes the vision of your employees through your commitment and passion

  • Mental toughness: Many people will doubt and challenge your ability, but you remain focused and unwavering


Balanced Pragmatism: Group minded actions and choices

  • Action Oriented: You find ways to make things happen using the data available to you, and recognize even transformational projects may need a staged approach

  • Business as Usual: Current operations and profit drivers are not forgotten or dismissed and reinforcing systems to support your vision are identified

  • Simple Clarity: You create visibility of your vision to everyone at all levels of the business, and find ways to reinforce current systems

  • Culture: You create a team culture of caring by leading through example, exhibiting a humble nature because although this may be your vision, it’s not about you


Tesla Got the Balance Right


Elon Musk had the transformational vision to help the world stop relying on fossil fuels with an all-electric vehicle brand. He went up against some of the largest companies and biggest brands in the world with unproven technology. He even launched the first Tesla knowing that defects and recalls were inevitable because there was so much to learn about the new technology.


This improbable dream would not have been achievable without an equalizing force; he balanced his vision with a pragmatic strategy. Tesla’s market entry in 2008 didn’t happen with a full line of cars and there was no extensive, capital intensive dealership network.


He launched just one vehicle.


Sure, the launch vehicle was a $100k sports car.


But despite the high cost, this focused strategy was pragmatic. Tesla was not operationally prepared for high volume sales yet, and needed to test and fail fast. This made a high-priced sports car the perfect choice. Tesla could appeal to early adopters who would love the technology and spread the word like wildfire. They would even be more accepting of product and issues recalls, because they likely had another car, with Tesla as their high-tech toy.


Initial success led to a gradual expansion: the Model S sedan, Model X Cross-over, and a down market play with the economical and affordable (sort of) Model 3.


It’s not just about creating a reality distortion field with an outlandish vision. Elon’s practical go to market strategy, that balanced the audacity of his vision, had at least as much to do with success in market.


Amazon got the balance wrong: the strategic leadership failure of the Fire Phone


Amazon usually wins, but Jeff Bezos failed in Strategic leadership with the launch of his Amazon Fire Phone.  It was heavy of transformational vision, but light on balanced pragmatism, a key tenet of strategic leadership.

On the other hand, Amazon launched their Fire Phone in 2014 without a scintilla of pragmatism, only operating in transformational vision mode. Jeff Bezos was doing iPhone like presentations, clamoring about the grand future of the phone. All of it’s amazing capabilities and integrations with Amazon Prime were being praised. The phone launched everywhere on all carriers with a massive marketing budget. I’m sure you remember hearing about the phone, but did you even for a second consider purchasing it vs. your Apple or Android phone?


Pragmatism was sorely lacking


Its $199 price point, with contract, was the same as the iPhone. People buy phones because of style, apps, and price. The Fire Phone was especially weak in apps and style, but high on price.


It turns out that a main thrust of creating an Amazon phone was to alleviate the competitive disadvantage of paying royalties to Apple and Android for purchases made through the Amazon App. Amazon wanted to avoid paying royalties more than it wanted to understand their consumer’s willingness to pay; this lack of pragmatism led to a $170MM loss on their balance sheet.


Strategic leaders to follow


The role of the strategic leader exists in this tension between his or her transformational vision and the need for pragmatism. It’s no easy feat for the mind to co-exist in these separate spheres simultaneously. When seen in action by great leader, this pendulum swing is a sight to behold.


These people have mastered the pendulum swing of strategic leadership


Julie Sweet, CEO of Accenture


Fortune listed her as one of the "Most Powerful Women" in 2016 through 2019. She has a bold “Let there be change” strategy to Accenture in the post COVID environment, possessing a keen sense of how technology will shape the future.


A.G. Lafley


Former chairman and CEO of P&G, he’s made countless big bets with billion-dollar brands like Olay and Tide. He took the stodgy Oil of Olay brand and created the new “masstige” category of beauty products, competing with departments stores in mass retail. His book, Playing to Win, is one of my top five books on strategy.



Martha Stewart, Martha Stewart Living Omnimedia


Martha Stewart went from running her small catering company to becoming a cooking and home décor magnate. She combined incredible vision with a demand for pragmatic action across multiple business and brands. She’s crafted an incredible personal brand of poise, while also being a panelist for the roast of Justin Bieber. She was able to turn around her declining businesses from prison. She’s sees things no one else does, and takes a lot of risk. But she’s not a perfect leader - it’s said she has a dark side and does not handle criticism well.


Lee Iacocca, Former Chrysler and For Executive


A classic example of a charismatic, larger than life leader, he was also very strategic. The Ford vs. Ferrari movie paints the picture of Iacocca as an amazing communicator both internally and externally, putting aside old-fashioned pomp in favor of clear communication. He was the transformative visionary of the Ford Pinto (a major innovatin for American cars in the 1970’s) and the now ubiquitous minivan.



Peter Drucker


The godfather of strategy, he is to business what Da Vinci was to art. He brought a new level of integrated thinking and rigor to how businesses are run, and many of his principles are taken for granted today. He was intensely interested in innovation and execution to accompany his business philosophies. He foreshadowed the importance of new technologies and the acceleration of innovation. A prolific author. A humble genius. He’s even the inventor of SMART goals. Yeah, that was him.


Sara Riles, Online Business Mentor


Sara Riles is an entrepreneur I’ve seen pop up a lot lately. If you check out here website here, you’ll notice it exudes strategic leadership, with Sara at the forefront of the brand. Sara focuses on empowering women to bring the work life balance they’re looking for, with a full suite of programs, including a virtual assistant starter kit. She takes her transformational vision, and brings it down to earth, coming off as an approachable friend as well as a business maven.


Conclusion


Strategic leadership is defined by contradiction and duality; the careful balance of outlandish vision for what others cannot see and the pragmatism to drive results in the appropriate way.


Elon Musk knows this pendulum swing, tempering his bold new vision for Tesla by launching with just one vehicle to a narrow audience of early adopters.


The missteps of strategic leadership are characterized by an inability to manage this precarious pendulum. Jeff Bezos’ launch of the Amazon Fire Phone was transformational vision top-heavy, going full bore on a product that didn’t even have a value proposition that made sense; pragmatism was sorely lacking and the pendulum only swung one way.


If you can balance futuristic thinking with action, take big risks while maintaining day-to-day operations, combine mental toughness with a kind culture, and inspire people while offering crisp clarity on what needs to be done, you’re embodying the qualities of strategic leadership.


To help internalize strategic leadership, be observant and watch other leaders, especially individuals in your own organization, deftly swing the strategic leadership pendulum or, in contrast, merely focus on either strategy or leadership separately. Emulate people from the list I provided, like Peter Drucker and Sara Riles. Give yourself stretch projects that force you to confront the dualities so you can harness and use your strategic leadership abilities. It’s one of the lesser talked about business skills, yet markedly separates the good from the great.


About this author: Adam Fischer leads content development for Strategy Kiln. As a marketing strategist, he’s held positions at Fortune 500 companies as well as start-ups. He holds a B.S. in philosophy from Northeastern University and an M.B.A. from Thunderbird School of Global Management at Arizona State University. He enjoys the enigmatic nature of business strategy and finding ways to grow an understanding of it for both himself and others.





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