Creating Wealth in Organizations

W. Glenn Rowe was a professor who wrote this article for the Academy of Management Executive research publication. His research is in the area of strategic leadership and he has published several journal articles. Rowe is an active consultant and has facilitated strategic thinking sessions for several organizations.

This article written for the Academy of Management Executive introduces readers to a new definition of strategic leadership. In addition, it differentiates among the concepts of managerial leadership, visionary leadership, and strategic leadership and looks at wealth creation under each of these types of leaders. Finally, some constraints on strategic leadership are discussed.

Rowe defines strategic leadership as “the ability to influence others to voluntarily make day-to-day decisions that enhance the long-term viability of the organization, while at the same time maintaining its short-term financial stability. Given this definition of strategic leadership for the article, Rowe presumes that both visionary and managerial leadership can coexist and that strategic leadership synergistically combines the two of these leadership styles. Strategic leaders are concerned with the future of an organization and are able to make decisions that achieve above-average returns. They create a large amount of wealth for their organizations.

Next, Rowe examines the concepts of managerial and strategic leadership. Managerial leaders adopt passive attitudes toward goals. Their goals arise out of necessities rather than dreams. Managerial leaders are also characterized as relating to people according to their roles in the decision making process. Rowe states that managerial leaders will “at best maintain wealth that has been created, and may even be a source of wealth destruction in the long-term if they are the predominant type of leader in their organization.

On the contrary, visionary leaders are more proactive