Strategic Leadership and the Governance of Public Institutions

Abstract

This article delves into the multifaceted realm of strategic leadership and its intricate relationship with the governance of public institutions. It not only advocates for the transformation of public sector organizations through strategic management but also elucidates the pivotal role that strategic leadership plays in this intricate process. 

By outlining the theoretical foundations and procedural intricacies of both strategic management and strategic leadership, the article puts forth propositions that specifically address the nuanced challenges and opportunities posed by the governance of public institutions.

These propositions not only take into account the distinctive needs inherent in the public sector but also delve into the intricate dynamics of implementing transformative change within these institutions. Special attention is given to the requisite strategies for executing radical changes, emphasizing their tailored application to the unique structure and functions of public institutions. 

Introduction

In an era defined by complex challenges and rapid societal evolution, the role of strategic leadership in shaping the governance of public institutions has garnered increasing attention from scholars and practitioners alike. Historically, discussions surrounding the implications of strategic management and leadership have predominantly centered around the private sector (Lane and Wallis, 2009; Kerlinová and Tomášková, 2014; Höglund and Svärdsten, 2015). This focus on the private sector may have contributed to the persistent challenges faced by the public sector in effectively implementing and harnessing the full potential of strategic management and leadership practices. 

Peter Drucker (1999), a pioneer in management theory, revealed that “Management is doing things right; leadership is doing the right things.” This distinction becomes particularly salient within the context of public institutions, where the ‘right things’ encompass not only efficient administration but also a keen understanding of governance structures and societal needs.

In the realm of public administration, the works of John W. Bryson 2011, author of “Strategic Planning for Public and Nonprofit Organizations,” provide a foundational understanding of how strategic leadership can be harnessed to drive transformative change. Bryson emphasizes the significance of strategic thinking and planning in the public sector, underscoring the need for leaders to navigate the intricate landscape of public governance with foresight and agility.

This article aims to unravel the complexities that define effective leadership within the intricate tapestry of public institutions.

 Strategic Leadership

 Strategic leadership is rather loosely defined, with no universally accepted definition. Instead of being a distinct leadership style or category, it can be viewed as the strategic component within the overarching leadership framework. 

Adair (2005) defined strategic leadership as an expansion of the original, for in Greek ‘strategy’ is made up of two words: Stratos, a large body of people; and the -egy ending, which means leadership”.  His basic definition of “Strategy is the art of leading a large body of people”. Moreover, Naidoo (2009) defined strategic leadership as “strategic leadership is the ability to influence others to voluntarily make day-to-day decisions that enhance the long-term viability of the organization” (p. 48, as cited in Rowe, 2001). Since strategic leaders have strong, optimistic expectations, they exploit and exchange tacit and explicit knowledge and they believe in strategic choice. Thus, strategic leaders synergistically combine the two types of leadership; managerial and transformational leadership and need to understand both to utilize and skills (Naidoo, 2009).

Organizational leadership thought can be organized into four fundamental approaches, as articulated by Pietersen in 2000. Visionary leader (type I): Visionary leaders are corporate architects and strategic thinkers who possess an overarching vision for the organization. Their primary focus is on defining and communicating a compelling vision that guides the entire organization.

Public organizations operate within a political context, responding to the needs and priorities of elected officials and constituents. This political environment can introduce instability and uncertainty, affecting leadership continuity and decision-making processes.

• Systems leader (type II): Systems leaders adopt a holistic perspective, emphasizing the technical and economic effectiveness of organizational operations. Their primary focus is on optimizing the internal workings of the organization, ensuring efficiency and effectiveness.
• Relationships leader (type III): Relationships leaders are adept at building trust, cooperation, and influence among various stakeholders. They prioritize fostering positive relationships both within the organization and with external partners.
• Transformational leader (type IV): Transformational leaders are charismatic figures who inspire change and seek a grand ideal of well-being and success. Their primary focus is on initiating and leading significant organizational transformations. 

Pietersen’s framework provides a comprehensive understanding of the diverse leadership paradigms that leaders may adopt. These four approaches offer insights into the varying philosophies and priorities that shape leadership styles in organizational contexts. Leaders may draw from these paradigms based on organizational needs, challenges, and strategic objectives.

Strategic Leadership in Public Institution

The onset of the new millennium marked the ascendancy of leadership in the public sector, gaining significant attention as a ‘hot topic,’ as noted by the OECD in 2001. This heightened interest in leadership coincided with a new wave of transformative changes occurring in the public sector across various nations. The shift, initiated in the 1980s, steered the public sector away from a culture centered on “administrators” and “policy” toward one emphasizing “management” and “efficiency.”

The distinct natures of public and private organizations necessitate different leadership approaches. In public institutions, leaders face the added challenge of navigating fluctuating political landscapes, as noted by Schall (1997). This dynamic environment demands adaptability and responsiveness from public sector leaders, as they must navigate the complexities of competing interests and stakeholders.

In public institutions, leadership is often subject to external factors and limitations that differ from those in private institutions. For instance, the government of a nation undergo regular changes in leadership due to election cycles, leading to potential disruptions and shifts in direction.

Schall (1997) highlights that public sector leaders may face constraints imposed by these frequent changes, limiting their ability to implement long-term strategies. 

Similarly, Lemay (2009) emphasizes the reduced control that public sector leaders often have compared to their private sector counterparts. This distinction in leadership dynamics stems from the inherent differences between public and private organizations. Public organizations operate within a political context, responding to the needs and priorities of elected officials and constituents. This political environment can introduce instability and uncertainty, affecting leadership continuity and decision-making processes.

As Joyce (2004) expresses, strategic leaders retain organizational progress in the direction of the strategic vision. In public organizations, strategic leaders usually give decision-making power and authority to managers and employees. The differences between leaders in public organizations and private organizations must not be ignored. The differentiation between these two sectors’ organizational structures must be considered as well. 

Burgon (2009) discusses how managers in public institutions face more challenges than managers in the private sector. The biggest challenge is public institutions deal with more complicated problems. He argues that dividing the problems into small pieces is not a way of solving complex problems; instead, he suggests that with a systematic method, the overall system must be considered to find solutions to complex problems. According to Taylor (2009), retention of skilled human resources is a challenge for strategic leaders during the execution of change. Subsequently, because of changes in every area, leaders need to gain new skills and methods for effective leadership. 

In Taylor’s (2009) perspective, contemporary public service grapples with six significant transformative trends, encompassing: (1) swiftly evolving citizen consumer profiles, preferences, and value propositions; (2) advancements in systems and technology-driven products, services, and competencies; (3) escalating interconnectedness among governments and organizations; (4) a growing necessity for public sector consolidations and accountabilities; (5) heightened competition in both international and domestic markets; and (6) an upsurge in regulatory, supervisory, and government policy interventions. These trends necessitate a novel approach to management, business, and leadership progression.

Leading a Public Institution 

Strategic leadership cannot be performed without strategic management. First, public officials must recognize the need for change. They must then exercise strategic management and develop strategic leaders. 

Finally, they must deploy strategic leaders. According to Nutt and Backoff (1993; 320), the purpose of strategic leaders is to restructure the company by incorporating all stakeholders. This sort of objective necessitates a long-term commitment, and while making changes, the entire business and its surroundings must be addressed. Thus, strategic leadership serves as a guiding approach for public institutions undergoing transition.

 First, public leaders have to see a need for change. They must then practice strategic management and train leaders to become strategic leaders. Finally, they must put strategic leaders into action. According to Nutt and Backoff (1993; 320), the strategic leaders’ goal is to transform the organization by involving all of the shareholders in the process. This type of goal requires a long-term commitment, and the entire organization and its environment must be considered when changes to be made. Thus, strategic leadership is providing a guidance process for public organizations in the case of transformation. 

Conclusion

In the face of rapid societal evolution and unprecedented change, this article encourages a paradigm shift in the governance of public institutions, envisioning a future where strategic leadership becomes a potent force in reshaping organizational landscapes.

In an era of rapid change, the article envisions a future where strategic leadership reshapes public governance. Insights from past and contemporary thought leaders provide a roadmap for public officials, guiding them in strategically managing and deploying leaders to meet the challenges of recent times.

The Author

Dr Toyin Sanni is the Vice Chairman of Emerging Africa Group, an Environmental, Social & Governance (ESG) focused group established by collaboration between institutional and private domestic and international investors with the aim of addressing Africa’s huge financial access gap and advancing Africa’s Sustainable Development Goals

References

1. Nutt, P. C., & Backoff, R. W. (1992). Strategic management of public and third-sector organisations
2. OECD (2001) Public Sector Leadership for the 21st Century. Paris: OECD Publications.
3. ADAIR, J. (2005), Developing tomorrow’s leaders, CBI Guide to Leadership 
4. Peter Drucker (1999), Management Challenges for the 21st Century
5. John W. Bryson (2011), Strategic Planning for Public and Nonprofit Organizations
6. JOYCE, P., (2004) Public sector strategic management: The changes required, Strategic Change, 13: 107–110
7. SCHALL, E., (1997), Public-Sector succession: a strategic approach to sustaining innovation, Public Administration Review, Vol. 57, No. 1, pp.4-10
8. BOURGON, J., (2009), Understanding the public leadership environment.