INTRODUCTION:

Table of Contents

01.Introduction1

02.Leadership Theories2-4

03.Comparison of Effectiveness of different leadership styles in different organizations5-8

04.Leadership Competencies9-11

05.Implementing and Leading change12-15

06.Change Management process16

07.Game theory17-22

08.Types of strategy22-24

09.Implications25

10.Conclusion26

11.Reference27-28

INTRODUCTION: "Leadership depends on an ability to call forth authentic action in response to the issues it identifies."-Bob Terry

Strategic leadership refers to a managers potentiality to express, anticipate vision for an organization and to motivate and persuade employees who have been working for the organization to acquire that vision. In order to know the meaning of actual Strategic leadership, we have to know the actual meaning of Strategic and Leadership. Strategic is very much related to the word Strategy, Which means a plan of action implementing a plan. The word Strategy can be used in both broad and narrow sense. But for Todays strategy we use the word for strategic planning, decision making, Bombing etc. We can know come forward to word Leadership. Leader is the person who lead his or her follower in such a way that will help them to achieve their desired goal.

In a recent survey of 400 executives from all over the world, approximately forty- percent believed that business leaders from emerging countries will be most influencing and dominating in the world economy for the next five years (Accenture, 2010). They have come forward to this point due to the huge change in the economic power rankings in recent years. Emerging countries such as Brazil, Russia, India and China have emerged as potential superpowers in the last two decades and will continue to degrade USA and Japan from the ranking in the near future (World Economic Forum, 2009; Accenture, 2009).

Leadership Theories:Interest in leadership actually emerged during the twentieth century. From several types of theories we can notify or give importance to eight type of theories. They are explained below:

"Great Man" Theory:

Great Man theory assumes that the ability for leadership is inbred. It also added that great leaders are born, not made. These theories often portray great leaders as heroic, mythic and destined to rise to leadership when needed. The term "Great Man" was used because, at the time, leadership was thought of firstly as a male quality, especially in terms of military leadership.Trait Theories:

Trait theory assumes that people inbred certain qualities and traits that makes them better adapted to leadership. It identify certain personality and behavioral characteristics of the leader.

Situational Theories:

Situational theories infer that the people who leads generally choose the best situation for the best course of action. Different styles of leadership may be more appropriate for certain types of decision-making.Contingency Theories:

Contingency theories of leadership focus on such variables related to the environment that might determine which specific style of leadership is most appropriate and adaptable for the situation. According to this theory, no leadership style is best in every situation. Eventually success depends upon a number of variables, including the leadership style, theory and qualities of the followers and aspects of the situation.

Behavioral theories:

Basically Behavioral theories of leadership are based upon the belief that great leaders are made, not born. This leadership theory focuses on the actions of leaders, Eventually not on mental qualities or internal factors. According to this theory, people can learn to become leaders through teaching and observation.Functional Theories:

Functional leadership theory (Hackman & Walton, 1986; McGrath, 1962; Adair, 1988; Kouzes & Posner, 1995) is a particularly influential theory for addressing specific leader behaviors expected to contribute to organizational or unit effectiveness. This theory argues that the leader's main job is to checkout and watch out whatever is necessary to group needs is taken care of, thus, a leader can be said to have done their job well when they have contributed to group effectiveness and cohesion (Fleishman et al., 1991; Hackman & Wageman, 2005; Hackman & Walton, 1986).

Management Theories:

Management theories focus on the role of supervision, organization and group performance. It is also known as transactional theories.Relationship Theories:

Relationship theory focus on the relation between the Leader and Followers. It is also known as Transformational theory.

1.1 Comparison of Effectiveness of different leadership styles in different organizations

Leadership styles, from the very classical autocratic approach to very modern participative approach, all have effectiveness depending on organizational structure and different situations (Kaith Davis, 2007). The leaders should be conscious about different leadership style as different leadership styles are needed for different situation, and they should adopt some leadership strategies focusing on organizations goals and objectives.

1.1.1 Autocratic Leadership Style

Autocratic leadership style is the classical approach and most old dated approach where managers hold maximum power and decision making authority, and employees have little or no right in decision making and they are expected to obey rules and regulations, and order attributed from higher authority. This leadership style relies on employee punishment and threats, and staffs are seemed to be untrusting. Though this leadership style is not so much effective in todays organizations, its not bad at all.In some countries it is very much applicable. Autocratic leadership style is more effective for the organizations that are new in their business operations because, at the beginning of any new business the future of the company remains uncertain (GA YUKL, 2006); any wrong decision may cause serious harmness for that organization. If we think from organizational perspective, autocratic leadership style is more effective for public sector organizations, and less effective for private sector and non-profit organizations like charity.

Graph:1

1.1.2 Democratic or Participative Leadership Style

Democratic leaders release the ultimate decision of anything, but gather information from staff level and share every higher to lower level decisions with all employees, and also keep employees informed of everything that affect their business. The most effective practice of democratic leadership style is shown in service sector organizations as the success of this kind of organizations directly rely on quality of services (BA Hayward, 2006).

Graph: 2

1.1.3 Free Rein Leadership Style

The free rein leader hold less authority and power to take any decision of an organization, and a high degree of independence is given to subordinates. The free rein leadership style is more effective for non-profit organizations.

Graph: 3Analysis with other Leadership Style :In 1960s, The University of Michigan Studies lead by Dr. Rensis Likert looked for leadership style for high performance teams. Likert came up with two dimensions of leadership behavior. Employee Oriented Style and Production Oriented Style are the two dimension for them.Likert constructed a scale with four different leadership styles called system 14.

System 1 is a very task oriented style with a very negative view of the subordinates. Leaders use threats and punishment to get subordinates to perform their work.

System 2 leaders have some confidence in their subordinates but all decisions are still made by the leaders.

System 3 leaders have much more trust and confidence in their subordinates and delegate some decisions.

System 4 is a very people oriented style with complete trust and confidence in the subordinates. This includes group decisions and building supporting relationship with the subordinates.

Likert stated that the highest performing teams who follow the employee oriented style are eligible for system 4 (Kleim, 2004).

Who have searched for Globe and Hofstede studies in the Power Distance dimension in India; in 67% situations, leaders are initially responsible for an outcome; whereas 11% situations describe shared responsibility of leaders and team, according to the studies of Ljungberg & Johansson (2010); Power distance has an effective effect on decision making in an organization. It is seen in a survey that only 56% leaders decided after consultative input from their employees, whereas 22% leaders did not take any input from others (Ljungberg & Johansson, 2010). This helps us to understand that there is a huge power distance in India and leaders are solely responsible for decision making in India.

From the above statements it can be derived that presently autocratic style of University of Iowa studies and system 1 & 2 of Likerts theory is prevailing in India, because employees in India need clear and distinct directions.

Although all of the studies state that Democratic style, High-high leadership structure, Team management style and System 4 are most beneficial styles for high performance of an organization in the long run. Also Globe and Hofstedes studies in the Power Distance show that a low power distance is the best option to improve productivity in the long run.

Leadership Competencies:A competence can be defined as the ability of as individual to activate, use and connect the acquired knowledge in the complex, diverse and unpredictable situations(Perrenoud,1997,in Svetlik,2005).According to Bennies(1987,citied in Thach et al.,2007) for effective leadership there are few leadership competencies that have been proven time and showed that they are very much compulsory. There are some common competencies which have been referred include: technical competence, honesty, integrity, diversity consciousness, change management, result orientation, problem solving, decision making, customer focus, business skill, team leadership, influential skill, conflict management and more importantly emotional intelligence, social and environmental responsibility, depending on the culture of the organization even humor and innovation(Trinka,2004;cited in thach et al,2007;spencer and spencer ,1993;Employers organisation,2004;Guggenheimer and Szule,1998;Breckenride Consulting Group,2004;OPM,1992;Laszlo,2003;Goleman,2003;Mckee and Boyatzis,2002;Thompson,1985)Basically we can aggregate those competencies and divide those elements into three parts.They are:

Cognitive Competencies:

This dimension of competencies includes control of general principles, laws, theories and concepts. Particularly it includes: Divergent thinking, Critical thinking, Creativity, strategic thinking, Problem solving, Analytical skills.Functional competence:Significant functional competencies include: Language and communication skill, technological skill(IT), career planning skill, Managerial skill and Decisional skill, International environment skill, Globalization skill(Manning,2003;May,1997;Suutari,2002.Harris,2001;)Personal and Social competence:The third dimension consists of competencies, which enable an individual to establish and maintain relationship with others: Self direction, Interpersonal skill, Teamwork skill, Integrity, Mobilizing skills, Personal and Social values, Character, Creativity and Compassion(Allio,2005)Leadership Qualities:There are Ten leadership qualities which helps a person to built himself as a leader. A good leader must have the discipline to work toward his or her vision single-mindedly, as well as to direct his or her actions and those of the team toward the goal.

Analysis:Integrity is the co-ordination of outward actions and inner values. A person having integrity is the same on the outside and on the inside. Such an individual can be trusted because he or she never changes from inner values, even when it might be adept to do so. A leader must have the trust of followers and therefore must display integrity..

Dedication means spending whatever time or energy is necessary to accomplish the task. A leader inspires dedication by example, doing whatever it takes to complete the next step toward the vision and goal. By approaching through dedication, one can build a better future for himself and others.Magnanimity means giving credit where it should be. A magnanimous leader ensures that credit for successes spread as widely as possible throughout the company. Conversely, a good leader takes personal responsibility for failures. This sort of reverse magnanimity helps other people feel good about them and draws the team closer together.

Humility recognizes that their will be equal right and evaluation for all. A humble leader is not self-effacing but rather tries to elevate everyone. Leader with humility will evaluate others with equal mentality. Leaders with humility also understand that their status does not make them a god. Mahatma Gandhi is a role model for Indian leaders, and he pursued a "follower-centric" leadership role.Openness means being able to listen to new ideas and share his views with others even if they do not conform to the usual way of thinking. Good leaders are able to suspend judgment while listening to others' ideas, as well as accept new ways of doing things that someone else thought of.Creativity is the ability to think differently, to apprehend differently, to get outside of the box that hinders solutions. Creativity gives leaders the ability to see things that others have not seen and thus lead followers in new directions. Fairness means dealing with others consistently and judicially. A leader must check all the facts and hear everyone out before passing judgment. He should have the mind to judge all equally that means no biasness will take place. He or she must avoid leaping to conclusions based on incomplete evidence. When people feel that they treated fairly, they reward a leader with loyalty, dedication and integrity.Assertiveness is not the same as aggressiveness. Rather, it is the ability to clear state what one expects so that there will be no misunderstandings. A leader must be assertive to get the desired results. Am assertive leader will lead him and others the right way to achieve or approach.A sense of humor is important to relieve tension and boredom, because it creates enthusiasm and Effective leaders know how to use humor to energize followers. Humor is a form of power that provides some control over the work environment. In addition, simply put, humor fosters good camaraderie. It helps employees to work with interest and eventually it brings out great result for both him and his organization.Implementing and Leading change:Heraclitus the Greek Philosopher said Change is the only constant. Actually everything is changing, changing with its views and with all other things. In this world the word change has become a meaningful word and eventually everyone need this sort of change. So change is needed for Leading. John Kotter, a professor at Harvard Business School and world renowned change expert introduced his eight step change process in his 1995 book "Leading Change. Now we are going to have a look on it:Step 1: Create Urgency

If the whole company really wants, it helps for change to happen,. Develop a sense of urgency around the need for change. This may help you spark the initial motivation to get things moving.

This is not simply a matter of showing people poor sales statistics or talking about increased competition. Open an honest and convincing dialogue about what is happening in the marketplace and with your competition. If many people start talking about the change you propose, the urgency can build and feed on itself. Therefore, it is an urgent position or time to make change for an organization.Step 2: Form a Powerful Coalition

Convince people that change is necessary. This will not be possible without strong leadership value. This often takes strong leadership and visible support from key people within your organization. Managing change is not enough one has to lead it.

One can find effective change leaders throughout our organization they do not necessarily follow the traditional company hierarchy. To lead change, one needs to bring a coalition or team of influential people, whose power comes from a variety of sources, including job title, status, expertise, and political importance.

Step 3: Create a Vision for ChangeWhen one first start thinking about change, there will probably many great ideas and solutions floating around. Link these concepts to an overall vision that people can grasp easily and remember.

A clear vision can help everyone understand why everyone asking him or her to do something. When people see for themselves what one is trying to achieve, then the directives they are given tend to make more sense.

Step 4: Communicate the Vision

What one does with his or her vision after he or she creates it will determine his or her success. His message will probably have strong competition from other day-to-day communications within the company, so he needs to communicate it frequently and powerfully, and embed it within everything that he or she does.

Do not just call special meetings to communicate ones vision. We should use the vision daily to make decisions and solve problems. When one keeps it fresh on his minds, he will remember it and respond to it.

Step 5: Remove Obstacles

If one follows these steps and reaches this point in the change process, one has been talking about his or her vision and building buy-in from all levels of the organization. Hopefully, ones staff wants to get busy and achieve the benefits that he or she has been promoting.

Put in place the structure for change, one should continually check for barriers to it. Removing obstacles can empower the people one needs to execute his or her vision, and it can help the change move forward.

Step 6: Create Short-term Wins

Nothing motivates more than success. Therefore, success is mandatory for motivating oneself. Give ones company a taste of victory early in the change process. Within a short time frame, (this could be a month or a year, depending on the type of change), he or she will want to have results that his or her staff can see. Without this, critics and negative thinkers might hurt ones progress.

Create short-term targets not just one long-term goal. One wants each smaller target to be achievable, with little room for failure. Ones change team may have to work very hard to come up with these targets, but each "win" that ones produce can further motivate the entire staff.

Step 7: Build on the Change

Kotter argues that many change projects fail because victory declares too early. Real change runs deep. To achieve long-term change, early victory is not needed. Only patience needed to achieve the long-term goal.Launching one new product using a new system is great. But if one can launch 10 products, that means the new system is working. To reach that 10th success, one needs to keep looking for improvements.

Each success provides an opportunity to build on what went right and identify what one can improve.

Step 8: Anchor the Changes in Corporate Culture

Finally, to make any change stick, it should become part of the core of ones organization. Ones corporate culture often determines what gets done, so the values behind ones vision must show in day-to-day work.

Make continuous efforts to ensure that the change has come in every aspect of ones organization. This will help give that change a solid place in his or her organization's culture.

It's also important that ones company's leaders continue to support the change. This includes existing staff and new leaders who are brought in. If you lose the support of these people, you might end up back where you started.

We have already gone through the eight step of Kotters Change theory. For the strategic implementation, only an authentic leader can implement the mandatory issues for developing an organization strategic hierarchy. Implementing corporate strategy requires a team effort headed by organizations leadership team. Each person involved in change management has his or her responsibilities, and it is important for the entire organization to understand the role of leadership in strategic implementation to make delegating responsibility more effective.Change Management process:

Involvement

Strategic implementation of any company that needs the proper way to do it should involve all the employees of the Company. Company needs to identify what those departments are and create an implementation team that consists of representatives from each affected group. Management needs to create and notify a structure that identifies various group leaders, after selecting them they have to be known about the responsibilities of those groups and an accountability system that insures that the implementation team meets its timetable for getting the new program or policy in place.

Interest

Sometimes organization feels the need of change and implementing those changes. Implementing change or any new strategy within a company requires a feeling of urgency on the part of the entire company. It is the job of management to create that urgency by explaining to the staff why the implementation is necessary. Leadership needs to help the employees understand how the company benefits from the new implementation. With changing those old dated things only leaders can create a new work environment.Monitoring

Strategic implementation within a company is not an exact and sloth process. It is a dynamic procedure. It needs monitoring by management and altering to meet implementation goals. It is the responsibility of leadership to put a monitoring system in place, analyze the data that is being generated during the implementation and make any necessary changes to make the implementation more efficient and competent.Next Step:Corporations implement the strategy in phases and in regular steps. The company leadership needs to be able to identify when each phase of a strategic implementation is accomplished and be ready to transition the company to the next phase. For example, if the company is bringing in a new software program for customer management, then the first phase of the program may be to implement it in the sales department. Then after setting on their sales department, they will start counting their total sales. By doing so they can come to the point that what they should do to increase total sales or productivity, whether they need any type of new strategy or not.Game theory:

Game theory has been a sufferer of its own successes. Now it is widely entrenched as a method of analysis as an important tool in economics, political science, law, social psychology and other disciplines. In mid nineteenth century with the publication in 1838 of augustin cournots researches into the mathematical principle of the theory of wealth ,in which he tried to explain the underlying behavior of duopolists. In 1944, John von Neumann and Oskar Morgenstern's The Theory of Games and Economic Behavior were published and with that the principle of game theory constructed. The Game theory has been widely used to the behavior of producers with a few competitor. The Game Theory refers that one has opponents who are conforming their strategies according to what they believe everybody else is doing and the opponents should be the part of ones strategy. In order to analyze such a game one put oneself at the place of other players stage. He recognizes that his opponents is as clever as he is and doing just the same thing as he is doing. Elements of a Game: Players: The decision makers in the game.

Actions: Choices available to a player.

Information: Knowledge that a player has when making a decision.

Strategies: Rules that tell a player which action to take at each point of the game.

Outcomes: The results that unfold, such as a price war, world peace, etc.

Payoffs: The utilities (or happiness) that each player realizes for a particular outcome.

Equilibria: An equilibrium is a stable result. Equilibria are not necessarily good outcomes, a fact that is illustrated by the prisoner's dilemma.

With a view to applying game theory to the behavior of firms, it faces a number of strategic choices, which lead their ability to grasp a desired pay-off. So,game theory is very much applicable and comparable with todays world.These are the decisions on price and output, such as:

Raise() Lower() Hold()These are the decisions on products, such as :

Keep existing products

Develop new productThese are the decisions on promoting products, such as :

More spending on advertising

Less spending on advertising Keep spending constant

Firms could originate a range of possible pay-offs from their strategy choices, including:

More profits for shareholders

Larger market share

Make better chances of survival

Getting rid of a rival

Here we have introduced Prisoners dilemma as a game theory.The Prisoner's Dilemma is a simple game. It demonstrates the choices facing oligopolies. As one read the scenarios, one can play the part of one of the prisoners. Here is the scenario:The scenario:Robin and Tom are prisoners. They are being arrested and accused for a petty crime. There is good evidence of their guilt they will receive Two-year sentence if they proved as guilty.During the interview, the police officer becomes suspicious about the two prisoners of being guilty of a serious crime, but is not sure he has any evidence.

Robin and Tom placed in separate rooms. There they cannot communicate with each other. The police officer tries to get them to confess to the serious crime by offering and showing them some options, with possible pay-offs.

The options:They are told that they will receive a sentence of three years if they both confess to the serious crime. However, they also told that if one of them confesses the serious crime then he will get a light sentence of one year, and the other will get ten years. So, It has become a dilemma for them. They know that if they both reject or deny the serious offence they are certain to be found guilty of the lesser offence, and will get a two years sentence.

The pay-off matrix:

This chart is showing the whole picture transparently. Here we can come to a conclusion which will be the better decision.

The dilemma is that their own pay-off is very dependent on the behaviour of the prisoners. However, there is a way of getting things at a better way. To avoid the worsen scenario (10 years), the safest and the better option is to confess and get three years sentence. If collusion is possible they can both come to the decision to deny (and get Two years), but there is a very strong possibility to betray because, if one denies and the other confesses, the best consequence of all is possible - that is one year. The best option is to confess if any possibility of cheating there.Types of strategy:Maximax: Where the player attempts to earn the maximum possible benefit available is called the maxima strategy. This means they will like to have the alternative. It includes the probability of achieving the best possible outcome even if a highly adverse outcome is possible.

This strategy, often referred to as the best of the best is often seen as naive or unaffected and overly optimistic strategy, however it assumes a highly auspicious environment for taking decision.The best pay-off will be for Robin from confessing is one year. But in that case Tom has to deny and the best pay-off from denying is two years (with Tom denying) - so the best of the best is to confess (one year).

Maximin:Where a player chooses the best of the worst pay-off is called the Maximain strategy. This is generally chosen when a player cannot depend on the other party to keep any agreement that has been made - for example, to accept. In the Prisoner's Dilemma, the worst pay-off to Robin will be confessing and getting three years (with Tom confessing), and the worst pay-off from denying is ten years (with Tom confessing) - therefore the best of the worst is to confess.

In this case, both the maximin and maximax strategies are referring to the same result, that will be Confessing .When this things happen, it is said to be the dominant strategy.

Dominant strategy:A dominant strategy is the best outcome regardless of what the other player selects. Now for that case it is for each player to confess - both the optimistic maximax and pessimistic maximin lead to the same decision being taken.

We have got the better outcome and worse outcome about Robin and Tom. Now we are going to find out how does this relate to a firm's behavior. Game theory gives opinion that firms are unlikely to trust each other, even if they collude and come to an agreement such as raising price or decline together.

Consider the hypothetical example of two Airlines and return ticket prices to New York.

In this case, for both Airline A and B, the aggressive maximax strategy is 140m from a low price and 120m from a high price. So we can come to the point that low price gives the maximax pay-off.

On the other hand, the pessimistic maximin strategy, the worst outcome from a low price is 100m, and from a high price is 70m - hence a low price provides the best of the worst outcomes.

Lowering price is the dominant strategy, and the only way to enhance the pay-off would be to collude and increase price together. Definitely, this requires an agreement, and collusion, and this creates two further risks - one of the airlines reneges on the agreement and 'rats', and the competition authorities investigate the airlines, and impose a penalty.

Nash equilibrium, which is named after famous Nobel winning economist John Nash, is a solution to a game relating two or more players who want the best outcome for themselves and must take the actions of others into account. After The Nash equilibrium is reached, players cannot make better their payoff by independently changing their strategy. This means that it is the best strategy thinking the other has chosen a strategy and will not change it. For example, in the Prisoner's Dilemma game, confessing is a Nash equilibrium because it is the best result, taking into account the likely actions of others.

Implications:Game Theory provides many information like capacity of getting or solving many problem into the behavior of oligopolists. For example, it shows that generating rules for behavior may take some of the risks out of competition, such as:

1. Using a simple cost-plus pricing method which is shared by all participants. This would work better in situations where oligopolists share similar or identical costs, such as with petrol retailing.

2. Without any type of confusion, agreeing a 'price leader' with other firms as followers. In the Airline example, firm A may lead and raise price, with B will be following suit. In this case, both would generate revenues of 120.

3. Supermarkets are completely agreeing with some lines where price-cutting will take place, such as bread or baked beans, but keeping price constant for most lines.

4. Generally keeping prices stable to avoid price retaliation.

Conclusion: Effective strategic leadership is a prerequisite to gain or achieve success in every organizational activities. Different types of Leadership theory can influence our both practical and institutional work success. Besides, Game theory helps one to develop optimal strategies. In an environment in which many outcomes and consequence are pre-determined when sophisticated players follow their best strategies, the way to improve one's payoff is to change the actual structure of the strategic interactions and strategies before the game is even played. This game theory has large implication in our practical life also.

"It is better to lead from behind and to put others in front, especially when you celebrate victory when nice things occur. You take the front line when there is danger. Then people will appreciate your leadership."-Nelson Mendela

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