Dr. Wael Shadid

29 July 2023

Abstract

Being at an advanced level is not an easy task. Leading organizations strive to reach this level. However, it isn't easy to maintain at an advanced level if governance cannot ensure that qualified leaders are in the correct phase of the organization's life cycle. The paper investigates the factors that make an organization at an advanced strategic level larger than others, and the crucial challenge that large organizations face at the maturity phase.

Introduction

Organizations in the same field of specialty differ in their sizes and abilities depending on many factors including, but not limited to, their age in the market, qualifications of the employees, their market share, their life cycle stage, strategic position, degree of loyalty, production size, clients services, public support, the financial position, and their capabilities and abilities. Organizations dealing with social and political issues are the same regarding the size and their influence. Indeed, profit organizations focus more on material profits; however, social and political organizations have the same goal but focus on their impact on society as a profit instead of materialistic profits.

Strategic traits of large or dominant organizations

It is a very long and challenging path for an organization to secure a leading position in the market.

Being one of the largest organizations as a leader requires gaining numerous factors, such as:

1. Sustaining this position for years
2. Having a sufficient number of followers to maintain momentum
3. Ability to defend this position against serious challenges and demonstrate resilience to counter adversity.
4. Mobilizing public support during challenging times and enduring the resulting hardships. In other words, obtaining the loyalty of the majority.
5. Ability to compensate for the loss of cadres and leaders due to death and assassinations.
6. Having wise leadership that can navigate through complexity and turbulence
7. Demonstrating creativity in work methods, mechanisms, approaches, and political initiatives under challenging circumstances
8. Maintaining financial resources to sustain operations
9. Having the right leaders for each stage of its life cycle

Dominant strategy (pioneer strategy)

To maintain its strategic position, large organizations need to adopt a leading strategy (pioneer strategy). The leading strategy in complexity and turmoil is usually a compounded strategy that consists of more than one strategic fit, such as (for example):

• Horizontal integration strategy
• Vertical integration strategy
• Innovation strategy
• Joint venture strategy

This combination of strategic fits, if adopted, will help the large dominant organization to:

• To attract the public’s admiration and obtain their loyalty
• Assimilate different social institutions and ingredients seamlessly
• Be aggressive, introduce future visions, and adopt strategic projects
• Be cost-effective and realistic in achieving goals
• Sustainable and resilient to stand in front of major challenges
• Add values for the public
• Preserve uniqueness and foster innovation

Such multiple or compound strategy fits enable the leading organization to maintain its leading position. For example, adopting the horizontal integration strategy will broaden its public base, control the diversity in activities and specialties, and strengthen its position by controlling the chain of various fields. Meanwhile, adopting the vertical integration strategy will facilitate the management of the vertical chain, maintain unity in directing along the vertical chain, obtain more advantages, reduce the dependency on others, be free from suppliers’ control, and benefit from the outcomes of different entities in the chain.

Similarly, adopting an innovative strategic fit will maintain the leadership position, and create initiatives. On the other hand, the joint venture strategy will share risks, coordinate competition, and provide collective efforts to achieve the goals. However, adopting a joint venture strategy requires clear governance to avoid internal disputes.

Adopting more than one strategy fit requires an ability to coordinate, control, understand and manage. It also requires leadership skills and a great deal of responsibility to implement these strategic fits. Additionally, it necessitates a high ability to integrate the different components.

Leadership style and the life cycle phases

Leadership style has an important relationship with the life cycle of an organization and may considered as one of the success factors. In the starting phase, organizations need aggressive leaders, multi-tasks, and a bold leadership approach that is reasonably adventurous and capable of quick wins to build a successful model. While in the maturity phase, the organization needs low-risk taker leaders, conservative to some extent, able to manage complexity, wise enough to tackle internal and external politics, able to accumulate successes to build the glory of the organization, and able to keep the leading position through strategic projects.

If the leadership style of the maturity phase is the same as the starting phase, it will be difficult for the organization to grow quickly and may stagnate. Conversely, if the leadership style in the maturity phase is reckless, adventurous, focuses on tactical wins instead of strategic ones, and lacks wisdom, then the organization will shift into a declining phase and enter an inertia mode until it eventually fails. The matter is similar in the case of leaders in the stage of maturity who are very conservative, walk slowly, and are unable to keep pace with the developments, as they will push the organization into a state of inertia as well.

In inertia mode, middle management governs and has a real effect on conducting organizations, which means the leader is no longer able to influence the strategic course of the organization. This might lead to the apex functioning as a group of board of directors rather than real leadership of the organization. Accordingly, a great deal of attention has to be paid to the strategic course, and the apex has to ensure that middle managers are well qualified and grasping the strategic vision and dimensions.

The most problematic case is when the leadership style in the maturity phase is characterized by individuals who are adventurous, reckless, focus only on action and reaction, and lack strategic vision. Such unprofessional amateur leaders will:

• Isolate competencies and strategic leaders
• Focus on limited wins
• Ignore the strategic projects for the sake of limited wins
• Rush through stages to focus solely on tactical issues and lose the patience needed to achieve strategic gains.
• Avoid accountability as much as they can
• Losing the strategic course and focus on show-off works
• Try to compensate for their lack of wisdom by attacking others
• Enlarge their humble achievements to build their glory
• Indirectly, the extremism will grow sharply in this context.
• Freedom and democracy will shrink, and people who want to preserve their dignity and continue to express their opinions will be removed from leadership positions or eliminated.

Such unprofessional and amateur leaders will push the organization to be strategically blind, losing integration and losing control over all levels. The organization will be far away from all strategic activities overall life cycle stages and will be unable to apply standardization to unify understanding and criteria. Moreover, the organization will lose the ability to identify and predict real risks, which will lead to internal disputes and conflicts.

Conclusion

Large organizations are very sensitive to leadership styles during their life cycle phases. The most crucial phase is when amateur leaders at the organization's maturity level lead the organization. Such leaders will expedite the decline and reach the point of no return faster. The glory of the organization and its successes can be distorted for the sake of temporary personal glory. Governance and transparency are among the most critical issues in the maturity phase to maintain the strategic position and the leading stance. In addition, such leaders will cause the organization to lose its loyal supporters and gradually lose the momentum to face serious challenges. Cadres and professional leaders will leave, and consequently, the organization will lose wisdom, professionalism, and creativity, leading to being strategically blind in the end.