Integrating Leadership and Strategic Management in Organizational Theory

Recent leadership theories have focused on top managers of organizations and their role in orchestrating change and influencing organizational culture (Bass, 1985a; Bennis, 1983; Tichy & Devanna, 1986; Tichy & Ulrich, 1984). Such a focus has moved leadership research beyond consideration of the influence of leadership on the performance and satisfaction of individuals and small groups, and has begun to bridge the gap between the micro and macro levels of analysis. However, the two research foci remain separate and much further integration is needed (Gupta, 1988; Hambrick, 1988). This paper proposes such an integration by linking leader's style to environmental perception, organizational culture, strategy, and structure. It does this by proposing moderators for such a relationship, and by outlining the processes through which the leader can influence organizational elements. IMPORTANCE OF LEADERS To some, organizations are driven by factors other than their management (Cyert & March, 1963; Hannan & Freeman, 1977; Lieberson & O'Connor; 1972; Salancik & Pfeffer, 1977). To others, management, in the form of a team or an individual, plays a role in the strategy and performance of organizations (Channon, 1979; Hambrick & Mason, 1984; Michel & Hambrick, 1987; Mott, 1972; Selznick; 1957; Weiner & Mahoney, 1981; Yukl, 1989). In spite of many past disagreements over the extent to which leadership influences various aspects of organizational functioning, recent interpretations of previous studies and current research findings suggest that leadership indeed has an impact on organizational elements and performance (Day Lord, 1988; Thomas, 1988; Weiner & Mahoney, 1981). However, the roots of much of the debate over the importance and impact of leadership lies in organization theory's (OT) and strategic management's (SM) philosophical assumptions. PHILOSOPHICAL ASSUMPTIONS: OBJECTIVE APPROACH The philosophical and methodological roots of OT and SM fall within the objective dimension or social scientific thought as defined by Burrell and Morgan(1979). In much of the OT and SM research, organizations and their environments are seen as existing outside of the individual's cognition. Such a realistic view is particularly evident in the research on organizational and environmental determinism (for a review see Jauch & Kraft, 1989). Classifications of environments are presented and various aspects of the environment and their effects on organizational decision making are studied (e.g., Keats & Hitt, 1988). Additionally, environmental and organizational factors are assumed to determine managerial decision making (Hannan & Freeman, 1977; McKelvey, 1975) and the leader is relegated to a symbolic position (Pfeffer, 1983). In accordance with the realistic, deterministic view of organizational functioning, many researchers in OT and SM take a positivist and nomothetic approach to leadership research. Attempts are made at measuring and establishing causal and regular patterns by use of formal and systematic methods (Burrell & Morgan, 1979). The objective approach to leadership research in OT and SM does not leave much room for consideration of the impact of leadership. In order to allow for consideration of the role of leaders in organizational functioning, assumptions of determinism and realism have to be reexamined and elements of the subjective approach (Burrell & Morgan, 1979) to the study of organizations have to be introduced. Use of nominalist rather than realist assumptions will allow acknowledging that reality is, at least partly, constructed through an individual's--in this case the leader's--cognition. Therefore, the environment and the organization can be influenced by the leader's characteristics. Further, pure determinism has to be combined with some degree of voluntarism to allow for consideration of the role of the leader in influencing organizational events. …