In an effort to grasp the knowledge of executives throughout North America in a post-COVID-19 world, I recently questioned leaders from large corporations operating in a wide range of industries. Many executives agree that leadership development has become a focal point of the executive span of control but has not been associated with organizational internal resources enough to make it an integral part of business success.
In the post-pandemic world, a critical question remains: How do a company’s characteristics impact leadership development? Jay Barney, a presidential professor of strategic management at The University of Utah, best known for his contributions to the resource-based theory of competitive advantage, presented executives with a slew of internal resources that provide a direct vision for the organization. However, the business literature, to date, has failed to provide a comprehensive framework that incorporates all of these internal resources that may simultaneously impact leadership development.
Exploring these internal resources and the impacts they may have provides practical implications for CEOs to develop leadership and meet their business objectives. Although prior studies provide evidence of the overlap between organizational internal resources and leadership development in organizations, there is a gap in the business literature in examining the implications of structure, culture, strategy, intercompany social networks and stakeholder orientation for leadership development.
Here are some of the ideas that I gathered from my conversations with executive colleagues leading in the post-pandemic world.
Corporate structure
The colleagues I spoke with mentioned that leaders inspire followers to generate new solutions and a better environment. They expressed that a highly centralized structure has a negative impact on leadership, while decentralization positively contributes to leaders in developing a more innovative climate. They argued that this can be enhanced by the crucial role of decentralized structures in facilitating the exchange of ideas and the implementation of more innovative solutions based on stipulating the power of decision-making at all levels of the organization.
Highly formalized structures are more bureaucratic, and this negatively contributes to the development of leadership in changing the existing situations and creating a better environment. Thus, leadership is more effective in more informal structures compared with bureaucratic structures. Hence, a formalized and centralized structure is negatively related to the development of leadership.
Corporate culture
When I asked executive colleagues how corporate culture can work best for them, they argued that trust is an important component of a collaborative culture that could positively contribute to developing and maintaining organizational communications. Both cultural aspects of collaboration and trust can be critical for leadership development, which is strongly based on developing relationships with subordinates. They expressed that a leader’s ability to build a more innovative environment is also highly dependent on the extent to which their reports trust them. Therefore, corporate culture that instills trust among the workforce enables leaders through mobilizing their followers’ support toward the leadership vision for changing current situations, whereas distrust will impair leadership development. Therefore, both cultural aspects of collaboration and trust can positively contribute to leadership.
Corporate strategy
Another factor that executive colleagues expressed was corporate strategy. Executives are aware that corporate strategy mainly encompasses four aspects: analysis, proactiveness, defensiveness and futurity. Analysis strategy aims to find the best solution for solving strategic problems or implementing strategic objectives using the problematic search of various options. Executive colleagues argued that leadership vision is affected by the problematic search of various alternatives and patterns to solve organizational problems. Futurity strategy also contributes to a leader’s ability to develop a more future-oriented vision for their organization.
We asked executive colleagues how they felt about these two strategies. They responded that both strategic aspects of analysis and futurity may have a positive impact on leadership development. In fact, these strategies help executives develop a shared long-term vision for the future. Moreover, analysis strategy creates more knowledge, and this can improve leadership effectiveness through generating more innovative solutions for both organizational problems and strategic development. Furthermore, every single executive colleague mentioned that leadership effectiveness can be improved through taking a proactive approach that searches for better strategic initiatives in the business environment. Thus, corporate strategy is positively related to leadership development.
Intercompany social networks
Executive colleagues expressed that intercompany social networks improve leadership effectiveness in developing a more innovative climate. They argued that intercompany social networks positively impact leaders’ views and motivate them in expanding relationships with their subordinates. Intercompany social networks, as noted by executive colleagues, can enable leaders in developing relationships with subordinates. They also expressed that these social networks can help leaders to effectively empower their followers. This could be justified by stressing the fact that firms linked together by using intercompany social networks are more capable in the effectiveness of learning. Thus, these social networks can have a positive relationship with the development of leadership.
Stakeholder orientation
Stakeholder orientation is another important aspect of leadership development in the post-COVID-19 world. Stakeholder orientation, as noted by executive colleagues, can improve leadership development through developing a better vision that incorporates stakeholder attitudes. The executive colleagues I contacted told me that leaders facilitate knowledge sharing and innovation and this could be positively affected by stakeholder orientation, which propels knowledge exchange with stakeholders. They also argued that a higher degree of innovation is also dependent on exchanging more knowledge with various resources such as stakeholders. And the exchange of knowledge can have a strong influence on learning within organizations.
Moreover, every single executive colleague I asked felt that the amount of knowledge exchanged with various stakeholders may be more likely to contribute to the development of leadership in identifying better opportunities in the business environment. Thus, leadership is more effective in organizations that have a high stakeholder orientation.
In conclusion
This article aims to help companies in developing leadership and sustaining the impact of the COVID-19 pandemic. In doing this, it provides elaborative insights for executives and senior managers by modeling how leadership development can be affected by company characteristics. The evidence from this study suggests that these company characteristics include structure, culture, strategy, intercompany social networks and stakeholder orientation.
